Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
FIYTA Precision Technology Co., Ltd.
March 2026
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 1 Important Notes, Contents and Definitions
The Board of Directors, directors, and senior management of the Company
warrant that the contents of this Annual Report are true, accurate and complete,
and that there are no false records, misleading statements, or material omissions,
and they will bear individual and joint legal liability.
Zhou Jinqun, the person in charge of the Company, Song Yaoming, the
person in charge of accounting, and Jiang Haiming, the head of the accounting
department (chief accountant), declare to ensure the truthfulness, accuracy and
completeness of the financial reports in this Annual Report.
All directors have attended the board meeting to review this report.
The forward-looking statements in this Annual Report, such as future plans
and development strategies, do not constitute a substantial commitment by the
Company to investors. Investors are advised to be aware of investment risks.
This report describes the risk factors that the Company may face. Please
refer to the section on the Company's future development outlook in Section III
Management Discussion and Analysis.
The profit distribution plan approved by the Board of Directors is as follows:
based on the total share capital on the record date for the future implementation of
the profit distribution plan, a cash dividend of 1.20 yuan per 10 shares (tax
included) will be distributed to all shareholders, with no bonus shares (tax
included) and no conversion of capital reserve into share capital.
This report is prepared in both Chinese and English. In case of any
discrepancy in the interpretation of this report, the Chinese version shall prevail.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Contents
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
List of Reference Documents
I. Financial statements signed and sealed by the legal representative, chief financial officer, and head of the
accounting department.
II. Original audit reports sealed by the accounting firm and signed and sealed by the certified public accountants.
III. Originals of all company documents and the drafts of announcements publicly disclosed during the reporting
period.
IV. Full text of 2025 Annual Report signed by the legal representative.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Interpretations
Term refers to Description
The Company, Company, FIYTA refers to FIYTA Precision Technology Co., Ltd.
AVIC refers to Aviation Industry Corporation of China, LTD.
AVIC INNO refers to AVIC Innovation Holding Limited
Shentian Technology Holdings refers to Shentian Technology Holdings (Shenzhen) Co., Ltd.
AVIC Finance refers to AVIC Finance Co., Ltd.
Phase II restricted stock incentive
refers to 2018 A-Shares Restricted Stock Incentive Plan (Phase II)
plan
Current Reporting Period, Reporting
refers to From January 1, 2025 to December 31, 2025
Period
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 2 Company Profile and Key Financial Indicators
I. Company Profile
Abbreviation FIYTA, FIYTA B Stock Code 000026, 200026
Stock abbreviation before
None
change (if any)
Stock Exchange Shenzhen Stock Exchange
Chinese name 飞亚达精密科技股份有限公司
Chinese name for short 飞亚达公司
Company name in foreign
FIYTA Precision Technology Co., Ltd.
language (if any)
Short company name in
FIYTA
foreign language (if any)
Legal representative Zhou Jinqun
Registered address FIYTA Technology Building, Gaoxin South 1st Road, Nanshan District, Shenzhen
Postal code 518057
On January 30, 1997, the registered address was changed from "Building No. 6, CATIC
City, Shennan Middle Road, Shenzhen" to "Building No. 6, CATIC City, Shennan Middle
Historical changes of
Road, Futian District, Shenzhen"; on April 5, 2000, the registered address was changed
registered addresses of the
to "FIYTA Building, No. 163 Zhenhua Road, Futian District, Shenzhen"; on February 20,
Company
Office address 20/F, FIYTA Technology Building, Gaoxinnan 1st Road, Nanshan District, Shenzhen
Postal code 518057
Company website www.fiytagroup.com
Email investor@fiyta.com.cn
II. Contact Information
Secretary to the Board of Directors Securities Affairs Representative
Name Song Yaoming Xiong Yaojia
Address Gaoxinnan 1st Road, Nanshan Gaoxinnan 1st Road, Nanshan
District, Shenzhen District, Shenzhen
Tel 0755－86013669 0755－86013669
Fax 0755－83348369 0755－83348369
Email investor@fiyta.com.cn investor@fiyta.com.cn
III. Information Disclosure and Location of Document Preparation
Website of the stock exchange where
the Company discloses its annual http://www.szse.cn
report
Securities Times, Hong Kong Commercial Daily, and Cninfo
Name and website of the media
(www.cninfo.com.cn)
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
where the Company discloses its
annual report
Location where the Company's
Planning, Operation and Capital Department of the Company
annual report is prepared
IV. Registration Changes
Unified Social Credit Identifier 91440300192189783K
Changes in the main business since the listing of the
No changes
Company (if any)
Historical changes of controlling shareholders (if any) No changes
V. Other Relevant Information
Accounting firm engaged by the Company
Name of the accounting firm RSM CHINA
Office address of the accounting firm
Xicheng District, Beijing
Names of signing certified public
Cai Ruxiao, Ge Hua
accountants
Sponsor institution engaged by the Company to perform continuous supervisory duties during the reporting period
Not applicable
Financial advisor engaged by the Company to perform continuous supervisory duties during the reporting period
Not applicable
VI. Key Accounting Data and Financial Indicators
Whether the Company needs to retroactively adjust or restate its accounting data of previous years
No
Operating revenue
(yuan)
Net profit attributable to
shareholders of the listed 87,317,829.63 220,350,184.99 -60.37% 333,178,102.37
company (yuan)
Net profit attributable to
shareholders of the listed
company after deducting 83,179,863.25 208,728,288.68 -60.15% 316,806,208.13
non-recurring gains and
losses (yuan)
Net cash flow from
operating activities 541,872,287.53 536,730,960.29 0.96% 632,401,487.98
(yuan)
Basic earnings per share
(yuan/share)
Diluted earnings per
share (yuan/share)
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Weighted average return
on equity
Year-end-on-year-
End of 2025 End of 2024 End of 2023
end change
Total assets (yuan) 3,733,401,610.34 4,007,690,717.02 -6.84% 4,204,260,897.08
Net assets attributable to
shareholders of the listed 3,336,540,162.45 3,391,843,200.61 -1.63% 3,333,805,752.19
company (yuan)
The lower of the Company's net profit before and after deducting non-recurring gains and losses was negative for the
last three consecutive fiscal years, and the audit report for the most recent year indicates uncertainty about the
Company's ability for continuous operation
No
The lower of the Company's total profit, net profit, and net profit after deducting non-recurring gains and losses, as
audited for the reporting period, was negative
No
VII. Differences in Accounting Data under Domestic and Foreign Accounting
Standards
International Accounting Standards and Chinese Accounting Standards
Not applicable
foreign accounting standards and Chinese Accounting Standards
Not applicable
VIII. Key Financial Indicators by Quarter
Unit: yuan
First quarter Second quarter Third quarter Fourth quarter
Operating revenue 924,208,353.87 859,923,583.36 890,827,959.90 833,528,014.27
Net profit attributable
to shareholders of 45,306,381.34 37,139,118.69 42,572,778.28 -37,700,448.68
the listed company
Net profit attributable
to shareholders of
the listed company
after deducting non-
recurring gains and
losses
Net cash flow from
operating activities
Whether there are any material differences between the above financial indicators or their aggregates and the relevant
financial indicators in the Company's previously disclosed quarterly and semi-annual reports
No
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
IX. Non-recurring Gains and Losses Items and Amounts
Unit: yuan
Amount for Amount for
Item Amount for 2025 Notes
Mainly due to the
disposal of certain
Gains and losses on disposal of
properties in the
non-current assets (including the
-1,233,966.09 2,367,816.60 685,868.57 same period of the
write-off portion of asset
previous year; no
impairment provisions made)
such event occurred
this year.
Government grants recognized in
the profit or loss of the current
period (excluding those closely
related to the Company's normal
operating activities, compliant 3,071,440.46 5,480,540.76 8,665,506.85
with national policies, granted
based on established standards,
and having a continuous impact
on the Company's profit or loss)
Gains and losses from changes
in the fair value of financial
assets and financial liabilities
held by non-financial enterprises,
and gains and losses from the
disposal of financial assets and
financial liabilities, excluding
effective hedging activities
related to the Company's normal
operating activities
Reversal of impairment provision
for receivables that were 2,621,990.02 3,753,262.84 7,570,975.54
individually tested for impairment
Other non-operating income and
expenses other than the items 202,564.54 2,834,587.38 3,910,736.70
above
Less: Impact of income tax 961,852.20 3,338,626.84 4,461,193.42
Total 4,137,966.38 11,621,896.31 16,371,894.24 --
Specific details of other profit or loss items that meet the definition of non-recurring profit or loss:
Not applicable
Explanation of the circumstances where non-recurring profit or loss items listed in the Explanatory Announcement No.
as recurring profit or loss items
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 3 Management Discussion and Analysis
I. Main business operations during the reporting period
Rooted in aviation precision technology and material science, the Company was founded with the mission to
"carry forward the spirit of serving the nation through aviation and create a quality life." Over the years, it has deeply
cultivated the watchmaking industry, establishing a core business structure where its proprietary watch brands and
comprehensive services for renowned watches mutually reinforce each other. The Company is committed to becoming
a leader in China's watch industry, promoting aviation and Chinese culture, while also actively nurturing emerging
industries such as precision technology.
Leveraging its continuous accumulation in professional watchmaking capabilities and brand operation
management, the Company owns the proprietary watch brands "FIYTA", "Emile Chouriet," and the authorized
cooperative brand "Beijing," covering mid-to-high-end, mass-market, and fashion segments. Among them, the core
brand "FIYTA" is positioned as "a high-quality Chinese watch brand featuring aerospace watches." It continuously
strengthens its unique aerospace IP and product quality, increases R&D efforts in movements and key components,
and integrates aerospace elements, Chinese cultural characteristics, and technological and material applications to
create differentiation and drive the brand development towards being more "young-oriented, high-end and
mainstream."
To seize opportunities in the domestic market for renowned watches, the Company established "Harmony," a
comprehensive service channel for prestigious timepieces, specializing in the distribution and servicing of world-
renowned watch brands. It has built close partnerships with numerous high-end and mainstream international brands.
"Harmony" is dedicated to "becoming the most outstanding comprehensive service provider for renowned watches." It
consistently and solidly enhances its operational and customer service capabilities. With its leading experience in
operating international brands, Harmony has become one of the top professional high-end chain commercial brands
for renowned watches in China, which in turn helps to enhance the operation of the Company's proprietary brands.
In recent years, guided by the development principle of "shared technology, common industrial roots and aligned
values", the Company has leveraged its technical strength and industrial accumulation in precision technology to
extend and actively cultivate emerging businesses, including precision technology.
II. Industry landscape during the reporting period
Currently, the company faces an increasingly complex and severe external environment. While China's retail
market continues to expand, upgrade, and experience a marginal recovery in consumer confidence, there is notable
divergence in consumer product categories. The watch industry specifically is experiencing a downturn. According to
revenue of domestic timepiece enterprises above a designated size decreased by 9.70% year-on-year, and the value
of Swiss watch exports to Mainland China declined by 12.1% year-on-year. Conversely, the high-end manufacturing
industry benefits from demand driven by emerging sectors like embodied intelligence, and the low-altitude economy,
presenting a broader market prospect.In this context, the company will enhance the competitiveness and market share
of its watch business, thereby stabilizing its core watch segment. This will be achieved by strengthening customer
research and insights, deepening brand partnerships in the comprehensive watch service business, and fostering
product differentiation in its proprietary brand business. Simultaneously, the company will stay committed to the
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
transformation and upgrade of its precision technology sector, increasing investment in key talent and technology to
accelerate the development of its emerging industry business.
III. Core competitiveness analysis
(I) Brand operation and management capabilities across the entire industry chain
The Company possesses operational and management capabilities spanning the entire industry chain, including
R&D, design, manufacturing, sales, and service. Through resource integration and business synergy, it continuously
strengthens the differentiation and competitiveness of its core proprietary brand, "FIYTA." During the reporting period,
the "FIYTA" brand was list into the "2025 China Consumer Famous Brands List" and featured in the "White Paper on
Brand Development for the 45th Anniversary of the Shenzhen Special Economic Zone," continuously enhancing its
brand influence and recognition.
(II) Refined operational and management capabilities across all channels
The Company has refined channel operation and management capabilities. By developing high-quality offline
channels and steadily promoting the integration of online and offline channels, it has continuously optimized its
channel structure and steadily improved operational efficiency. It has now established a comprehensive channel
network that covers both online and offline platforms, spanning domestic and international markets.
(III) Core technological capabilities in precision technology
As a National Demonstration Enterprise for Technological Innovation, a National Enterprise Technology Center,
and a National Industrial Design Center, the Company possesses key core technologies and high-end watchmaking
craftsmanship, covering in-house watch movements, component manufacturing, and the development of aerospace
watches. Relying on its R&D and production platforms in Shenzhen and Switzerland, it focuses on tackling key
technical challenges and continuously promotes breakthroughs in movement technology and the application of
scientific research achievements. During the reporting period, the Company's wholly-owned subsidiary, Shenzhen
FIYTA Precision Technology Co., Ltd., was certified as a national-level "Little Giant" enterprise for its specialization,
refinement, uniqueness, and innovation, becoming the second subsidiary after Shenzhen FIYTA Technology
Development Co., Ltd. to receive this certification.
(IV) Efficiently empowering digital operation and management capabilities
The Company has a diversified digital retail system and digital management platform that empowers its business
and employees. By continuously deepening the application of digitalization in management, manufacturing, sales, and
service, it promotes synergy among various businesses and enhances operational efficiency. During the reporting
period, the Company continued to advance its digital transformation through initiatives such as optimizing its digital
retail system, upgrading its operational management system.
(V) Professional talent development capabilities
Based on the philosophy of "value creation," the Company continuously invests in talent development. It has a
sound system for talent selection, training, and promotion, as well as a professional and stable talent pool. By building
innovative incentive mechanisms and exploring diversified talent motivation methods, it has cultivated many
outstanding industry representatives in core areas such as design, R&D, and manufacturing. During the reporting
period, the Company was awarded the title of "Shenzhen Federation of Trade Unions Industrial Worker Training
Center" by the Shenzhen Federation of Trade Unions. Mr. Bei Jinghui, an employee of the Company, was honored as
a "National Model Worker of Light Industry" for his outstanding performance in the watchmaking industry.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
IV. Main business analysis
In 2025, the Company continued to deepen its presence in the watch business, consolidating its leading position
in the domestic watch market and enhancing its core competitiveness. It accelerated strategic transformation and
upgrading to strengthen its core functions. During the reporting period, amid a continuously challenging domestic
watch consumer market, the Company achieved an operating revenue of 3,508,487,911.40 yuan, a year-on-year
decrease of 10.96%. The total profit was 120,103,837.72 yuan, a year-on-year decrease of 58.02%. The Company
focused on refined management, quality improvement, and cost reduction, maintaining stable cash flow from operating
activities and keeping operational risks under control. Facing market challenges, the Company remains confident in its
development and values shareholder returns. It has now formulated the 2025 cash dividend plan, proposing to
distribute a cash dividend of 1.20 yuan (tax included) per 10 shares to all shareholders.
During the reporting period, the company’s key operational initiatives are as follows:
(I) Strengthening Brand Positioning and Enhancing Competitive Advantage through "Aviation Heritage +
Chinese Culture"
During the reporting period, adhering to its positioning as a "high-quality Chinese watch brand with aerospace-
themed timepieces as its hallmark," the "FIYTA" brand focused on its aviation heritage and delved deeper into its
brand essence. It launched aerospace-themed products such as the "Y-20" Fortune Edition, the "Small Spacecraft" 3D
Time Reading Edition, and the "J-10" Crossover Edition. Through innovations in craftsmanship and materials, the
brand integrated elements of Eastern aesthetics into product design, introducing new collections such as the "Little
Gold Watch" Butterfly Fortune Edition, the "Shishi Ruyi" Song Porcelain Edition, and the "Oriental Beauty" Su
Embroidery Edition. By deeply blending "Chinese design, Chinese storytelling, and Chinese craftsmanship," the brand
established differentiated product features. Collaborations with fashion brands at Shanghai and Paris Fashion Weeks,
as well as marketing campaigns around high-impact events such as the launches of "Shenzhou-20" and "Shenzhou-
build a brand communication matrix spanning fashion, technology, and culture, enhancing brand visibility and influence.
(II) Continuously Optimizing Channel Structure and Operating Systems to Promote Online-Offline Synergy
During the reporting period, the "FIYTA" brand further developed its offline proprietary channels. Through member
operations, new media engagement, and in-store livestreaming, its self-operated stores enhanced refined operational
capabilities. Online, leveraging the trend of women’s watches as fashion accessories, the brand strengthened its hit
product strategy, achieving growth against market trends during major promotional campaigns such as "618" and
"Double 11," with multiple products ranking high in sub-categories of major e-commerce platforms’ watch sections. By
building a distinctive livestreaming matrix and strengthening omni-channel marketing capabilities, the brand effectively
promoted synergy between online and offline channels, increasing its market share in the domestic watch segment.
"Harmony" continued to optimize its brand and channel structure, focusing on leading brands and core channels
while steadily advancing the integration of brand and channel resources and optimizing their layout. Through deep
cultivation of store operations and customer service, and the implementation of a refined "one store, one strategy"
operational approach, it gained high recognition from partner brands and strong customer satisfaction.
(III) Increasing Investment in Precision Technology Business to Accelerate Strategic Transformation and
Upgrading
During the reporting period, the company’s watch business increased R&D investment in the development of in-
house movements, key components, and the application of aerospace materials. Through the development of new
processes, equipment upgrades, and the recruitment of key talent, the company strengthened its technological
foundation, enhanced capabilities in product R&D, precision manufacturing, and customer service, and actively
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
expanded into new markets and client segments. The company plans to acquire a controlling stake in Shaanxi
Changkong Gear Co., Ltd. to enter the precision gear and precision reducer business sectors, thereby strengthening
the technological capabilities and industrial layout of its precision technology business and driving strategic
transformation and upgrading.
(IV) Advancing Digital Implementation and Strengthening the Application and Empowerment of Digital
Platforms
During the reporting period, the company focused on key areas such as digital retail and operational management,
promoting the integration and scenario-based application of technologies with platforms such as the digital retail
system, CRM system, and SAP system. It optimized management systems for manufacturing, finance, and operations,
and launched tools such as the Excellent Digital Assistant to enhance operational efficiency.
Year-on-Year Changes in Key Financial Data
Balance Sheet Items
Unit: yuan
Item Closing Balance Opening Balance Change (%) Reason for Change
Notes Mainly due to the maturity and
receivable endorsement of notes.
Other current Mainly due to a decrease in time deposit
assets business.
Mainly due to an increase in
Other non-
current assets
purchases.
Short-term Mainly due to the repayment of bank
borrowings loans.
Mainly due to the unlocking of restricted
Treasury stock 0.00 12,815,556.81 -100.00%
stocks.
Income Statement Items from the Beginning of the Year to the End of the Reporting Period
Unit: yuan
Amount for the Current Amount for the
Item Change (%) Reason for Change
Period Previous Period
Mainly due to a decrease in interest
Financial
expenses
losses.
Investment Mainly due to an increase in losses from
-3,886,480.19 -431,254.89 -801.20%
income associate enterprises.
Credit Mainly due to an increase in bad debt
-3,062,496.54 266,485.96 -1249.21%
impairment loss provisions for accounts receivable.
Asset Mainly due to an increase in inventory
-53,936,941.10 -19,289,865.31 -179.61%
impairment loss impairment provisions.
Gains on Mainly due to the disposal of certain
disposal of -1,233,966.09 2,367,816.60 -152.11% properties in the same period of the
assets previous year.
Cash Flow Statement Items from the Beginning of the Year to the End of the Reporting Period
Unit: yuan
Amount for the Amount for the Change
Item Reason for Change
Current Period Previous Period (%)
Net cash received from the
Mainly due to the disposal of
disposal of fixed assets,
intangible assets, and other
period of the previous year.
long-term assets
Cash paid for other investing Mainly due to a decrease in
activities time deposit business.
Mainly due to a decrease in
Cash received from borrowings 140,000,000.00 323,957,187.86 -56.78%
bank borrowings.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Cash paid for repayment of Mainly due to a decrease in
debts bank borrowings.
(1) Operating revenue breakdown
Unit: yuan
Percentage of Percentage of Year-on-year
Amount operating Amount operating change
revenue revenue
Total
operating 3,508,487,911.40 100% 3,940,530,934.07 100% -10.96%
revenue
By industry
Watch
business
Precision
technology 143,992,442.15 4.11% 134,469,811.50 3.41% 7.08%
business
Leasing
business
Others 18,167,601.23 0.52% 11,685,876.44 0.30% 55.47%
By product
Watch brand
business
Comprehensiv
e services for
renowned
watches
Precision
technology 143,992,442.15 4.10% 134,469,811.50 3.41% 7.08%
business
Leasing
business
Others 18,167,601.23 0.52% 11,685,876.44 0.30% 55.47%
By region
South China 1,603,321,919.78 45.70% 1,857,820,951.58 47.15% -13.70%
Northwest
China
North China 109,629,862.19 3.12% 122,281,678.29 3.10% -10.35%
East China 451,602,612.98 12.87% 492,238,757.53 12.49% -8.26%
Northeast
China
Southwest
China
By sales model
Direct sales 3,414,048,530.25 97.31% 3,794,632,582.06 96.30% -10.03%
Distribution 94,439,381.15 2.69% 145,898,352.01 3.70% -35.27%
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
(2) Industries, products, regions or sales models accounting for more than 10% of the Company's operating
revenue or operating profit
Unit: yuan
Year-on-year Year-on-year
Gross Year-on-year
change in change in
Operating revenue Operating cost profit change in
operating gross profit
margin operating cost
revenue margin
By industry
Watch 35.39
business %
Leasing 63.08
business %
By product
Watch brand 67.22
business %
Comprehensi
ve services 28.57
for renowned %
watches
Leasing 63.08
business %
By region
South China 1,603,321,919.78 1,007,528,134.01 -13.70% -12.39% -0.94%
%
Northwest 34.77
China %
North China 109,629,862.19 69,063,080.14 -10.35% 1.76% -7.50%
%
East China 451,602,612.98 296,821,853.65 -8.26% -7.53% -0.52%
%
Northeast 30.48
China %
Southwest 34.98
China %
By sales model
Direct sales 3,414,048,530.25 2,214,686,992.39 -10.03% -7.98% -1.45%
%
Distribution 94,439,381.15 47,444,041.37 -35.27% -31.81% -2.55%
%
In the event that the statistical basis for the Company's main business data was adjusted during the reporting period,
the Company's main business data for the most recent year, adjusted according to the basis at the end of the reporting
period
Not applicable
(3) Whether the Company's revenue from the sales of goods is greater than its revenue from rendering
services
Yes
Industry Year-on-year
Item Unit 2025 2024
classification change
Branded Sales volume Pcs 658,385 978,021 -32.68%
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
watches Production
Pcs 428,722 972,522 -55.92%
volume
Inventory Pcs 547,352 777,015 -29.56%
Explanation of the reasons for any year-on-year change of more than 30% in the relevant data
During the reporting period, the sales and production volume of branded watches declined, primarily due to relatively
weak demand in the watch consumer market. The company strengthened inventory management, accelerated
inventory turnover, and implemented strategic adjustments to certain business operations, including a reduction in
production volume.
(4) Performance of major sales contracts and major purchase contracts signed by the Company as of the end
of this reporting period
Not applicable
(5) Operating cost breakdown
By industry and product
Unit: yuan
As a As a
Industry Year-on-
percentage of percentage
classificati Item year
Amount operating Amount of operating
on change
costs costs
Percentage Percentage
Cost of goods
Watch purchased
business Raw
materials
Unit: yuan
As a As a
Year-on-
Product percentage of percentage
Item year
category Amount operating Amount of operating
change
costs costs
Percentage Percentage
Comprehe
nsive
services Cost of goods
for purchased
renowned
watches
Watch
brand Raw materials 166,625,918.83 7.37% 214,145,376.12 8.65% -22.19%
business
Notes
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
(6) Whether the scope of consolidation changed during the reporting period
No
(7) Information on major changes or adjustments to the Company's business, products, or services during the
reporting period
Not applicable
(8) Information on major customers and suppliers
Information on the Company's major customers
Total sales to the top five customers (yuan) 845,711,560.86
Total sales to the top five customers as a percentage of
total annual sales
Sales to related parties among the top five customers as
a percentage of total annual sales
Information on the Company's top 5 customers
As a percentage of total
No. Customer name Sales amount (yuan)
annual sales
Total -- 845,711,560.86 24.11%
Other information on major customers
Not applicable
Information on the Company's major suppliers
Total purchases from the top five suppliers (yuan) 1,638,332,375.31
Total purchases from the top five suppliers as a
percentage of total annual purchases
Purchases from related parties among the top five
suppliers as a percentage of total annual purchases
Information on the Company's top 5 suppliers
As a percentage of total
No. Supplier name Purchase amount (yuan)
annual purchases
Total -- 1,638,332,375.31 80.50%
Other information on major suppliers
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
During the reporting period, the Company's trading business revenue accounted for more than 10% of its operating
revenue
Not applicable
Unit: yuan
Year-on-
year change
Selling expenses 781,062,383.74 882,777,806.63 -11.52% Not applicable
Administrative
expenses
Mainly due to a decrease in
Financial expenses 11,395,885.23 17,924,871.34 -36.42%
interest expenses.
R&D expenses 69,206,682.36 56,000,000.18 23.58% Not applicable
Expected impact on
Name of major R&D Project
Project objective Intended goal the Company's future
project progress
development
Develop watch products
To provide the
incorporating aerospace
market with
design elements centered
innovative products
A new series of Completed on the aerospace theme;
featuring aerospace- Provide innovative
products with FIYTA the tasks for develop a series of women's
themed brand watch products
brand characteristics the year watch products with the
elements and
qualities of fashionable
fashionable
accessories and promote
accessory qualities
their launch and sales
To meet the development
needs for the aerospace
series and decorative ladies'
watches, carry out
Enhance the Enhance the
Develop innovative innovative structural design,
performance and Completed performance and
structures, materials, strengthen research on the
market the tasks for market
and processes for application of new
competitiveness of the year competitiveness of
new products materials, and promote
new products new products
process innovation to
enhance overall product
performance and enrich
their functions
In response to the needs for
brand differentiation and
Develop mechanical Enhance the innovative products, Enhance the
watch movements performance and Completed develop mechanical watch performance and
with brand- market the tasks for movements and key market
differentiated competitiveness of the year components with special competitiveness of
features new products functions and indication new products
methods, and apply them in
new watch products
Develop special- Provide special- Completed Develop and deliver special- Provide special-
purpose watches for purpose equipment the tasks for purpose equipment watches purpose equipment
manned spaceflight watches for the the year according to the watches for the
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
manned spaceflight requirements of manned manned spaceflight
sector spaceflight missions sector
Develop an integrated
human performance
Enhance the
enhancement platform that
Build a capabilities of
Key technologies for integrates data collection,
comprehensive and integrated solutions,
upgrading from a status assessment, and
fully functional Completed enabling the
single device to an cognitive training functions,
integrated system the tasks for Company to enter
integrated solution of as well as research,
platform for human the year higher value-added
"hardware + software develop, and validate
performance markets and expand
+ data + services" related smart terminal
enhancement its business
product series, evolving
boundaries
from a single product to a
platform + solution model
Company's R&D personnel
Number of R&D personnel
(persons)
Percentage of R&D
personnel
Educational background of R&D personnel
Bachelor's degree 108 73 47.95%
Master's degree 17 20 -15.00%
Doctoral degree 3 1 200.00%
Junior college degree or
below
Age structure of R&D personnel
Under 30 49 34 44.12%
Over 40 54 42 28.57%
Company's R&D investment
R&D investment amount (yuan) 69,206,682.36 56,000,000.18 23.58%
R&D investment as a percentage of
operating revenue
Amount of capitalized R&D
investment (yuan)
Capitalized R&D investment as a
percentage of total R&D investment
Reasons for and impact of major changes in the composition of the Company's R&D personnel
Not applicable
Reasons for the significant year-on-year change in the ratio of total R&D investment to operating revenue
Not applicable
Reasons for the significant change in the R&D investment capitalization rate and an explanation of its reasonableness
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Unit: yuan
Item 2025 2024 Year-on-year change
Subtotal of cash inflows from
operating activities
Subtotal of cash outflows from
operating activities
Net cash flow from operating
activities
Subtotal of cash inflows from
investing activities
Subtotal of cash outflows from
investing activities
Net cash flow from investing
-39,798,121.53 -110,891,500.82 64.11%
activities
Subtotal of cash inflows from
financing activities
Subtotal of cash outflows from
financing activities
Net cash flow from financing
-390,370,553.83 -411,345,519.74 5.10%
activities
Net increase in cash and cash
equivalents
Explanation of the main factors affecting major year-on-year changes in relevant data
The net cash flow from investing activities increased by 64.11% year-on-year, mainly due to a decrease in expenditure
on time deposits and the construction of fixed assets.
The amount of cash inflows from financing activities decreased by 56.78% year-on-year, mainly due to a decrease in
bank borrowings.
Explanation of the reasons for the significant discrepancy between the net cash flow from operating activities and the
net profit for the year during the reporting period
Mainly due to the Company's reduction in inventory procurement based on the actual conditions of the watch
consumer market during the reporting period, which ensured the relative stability of cash flow from operating activities.
V. Analysis of non-main business
Not applicable
VI. Analysis of assets and liabilities
Unit: yuan
End of 2025 Beginning of 2025
Explanation of
As a As a Change in
major
Amount percentag Amount percenta proportion
changes
e of total ge of
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
assets total
Proportion assets
Proportio
n
Cash and cash
equivalents
Accounts
receivable
Contract assets 0.00 0.00% 0.00 0.00% 0.00% Not applicable
Inventories 1,727,982,404.66 46.28% 1,984,486,969.74 49.52% -3.24% Not applicable
Investment
properties
Long-term
equity 46,436,556.86 1.24% 50,907,036.84 1.27% -0.03% Not applicable
investments
Fixed assets 343,353,998.15 9.20% 377,568,144.41 9.42% -0.22% Not applicable
Construction in
progress
Right-of-use
assets
Short-term
borrowings
Contract
liabilities
Long-term
borrowings
Lease liabilities 17,892,390.31 0.48% 35,065,292.04 0.87% -0.39% Not applicable
High proportion of overseas assets
Not applicable
Not applicable
Not applicable
VII. Analysis of investment status
Not applicable
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Not applicable
(1) Securities investments
Not applicable
(2) Derivative investments
Not applicable
VIII. Disposal of major assets and equity
Not applicable
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
IX. Analysis of major holding and shareholding companies
Information on major subsidiaries and shareholding companies that contributed 10% or more to the Company's net
profit
Unit: yuan
Com Register
Company Main Operating Operating
pany ed Total assets Net assets Net profit
name business revenue profit
type capital
Sales of
Shenzhen
watches
Harmony
and
World Subsi 600,000, 1,752,589,8 1,077,557,0 2,586,332,5 176,927,5 133,345,1
compone
Watch diary 000 45.00 33.09 20.01 23.93 60.76
nts, and
Center
repair
Co., Ltd.
services.
Manufact
Shenzhen
uring of
FIYTA
Subsi watches 180,000, 320,854,65 221,955,90 295,683,33 5,849,413. 10,975,38
Precision
diary and 000 1.38 5.49 4.23 75 0.92
Technolog
compone
y Co., Ltd.
nts.
Shenzhen Productio
FIYTA n and
Technolog processin
Subsi 50,000,0 196,097,04 168,252,91 150,750,78 149,730.9 1,328,082.
y g of
diary 00 7.42 5.79 4.90 6 32
Developm precision
ent Co., compone
Ltd. nts.
Acquisition and disposal of subsidiaries during the reporting period
Not applicable
Information on major holding and shareholding companies
increase in gross profit margin.
decrease in gross profit margin and a reduction in government grants.
X. Structured entities controlled by the Company
Not applicable
XI. Outlook for the Company's future development
(I) Future development strategy
In 2026, guided by the principle of value creation, the company will enhance management quality, organizational
capabilities, and optimize its brand-channel structure to consolidate the foundation of its watch business. It will
increase investment in key areas, strengthen precision manufacturing capabilities, and develop emerging industry
businesses, steadfastly advancing the following tasks:
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
The FIYTA brand will adhere to its positioning as "a high-quality Chinese watch brand featuring aerospace
timepieces." Centered on the customer and led by the brand, it will optimize product design and the product matrix.
The company will establish a GTM management system to foster efficient collaboration across the entire industry
chain — from R&D and design to production and sales — promoting deep integration of product success and
commercial success.
The watch business will focus on core premium brands and channels, continuously refining its business structure.
It will strengthen refined operational management, enhance inventory turnover efficiency, and improve asset
quality. By deepening customer service and implementing precision marketing, the company aims to elevate
customer satisfaction and loyalty.
The company will concentrate on core watch technologies and emerging industry sectors, increasing investment in
key talent and R&D. It will advance breakthroughs in proprietary movement technology and strengthen supply
chain collaboration. Anchored in precision manufacturing product solutions, efforts will focus on securing key
clients and achieving technological breakthroughs. Concurrently, the company will accelerate the acquisition of a
controlling stake in Changkong Gear to deepen business integration and empowerment.
The company will deepen talent development, introducing and cultivating key personnel in core technologies and
emerging strategic areas. It will refine differentiated incentive mechanisms to fully motivate the team. By building a
closed-loop strategic operation management system, the company will promote business-finance integration and
process optimization, fostering agile and efficient organizational capabilities.
(II) Potential Risks and Response Measures
Currently, the company faces market risks due to subdued demand in the domestic traditional watch consumption
sector. The company will firmly adhere to its brand positioning, continuously develop differentiated products, and
enhance product strength and brand power to promote market share growth. It will persistently optimize its channel
structure, promote the synergistic development of online and offline channels, and actively expand into overseas,
duty-free, and other channels. Customer-oriented operations will be strengthened through refined management
and precision marketing to improve consumer perception and brand recognition. Furthermore, the company will
increase resource allocation and capacity building for emerging industry businesses, continuously driving strategic
transformation, upgrading, and business growth.
The company currently faces technological challenges across multiple domains, including the traditional watch
business, emerging industry businesses, and digital applications. In response, the company will increase
investment in talent and R&D related to core technologies, introduce key personnel, refine talent incentive
mechanisms, and advance breakthroughs and capability enhancement in core areas. These areas include the R&D
of proprietary movements and key components, establishment of specialized precision manufacturing product lines,
development and integration of smart terminal systems, and application of cutting-edge technologies like AI,
thereby enabling high-quality business development.
The company is currently advancing the work related to acquiring a controlling stake in Changkong Gear. The final
transaction plan has not yet been determined, and uncertainties exist.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
XII. Reception of research, communication, interviews, and other activities during
the reporting period
Type
Index of
of Main topics
basic
Reception Reception Reception recepti Reception discussed
information
time location method on counterpart and data
on the
counte provided
research
rpart
The
Investors
Company's https://irm.cni
Online participating
https://eseb.c operating nfo.com.cn/ir
March 27, communicatio remotely in the
n/1mA8hfz6A Others conditions, cs/search?ke
platform annual results
plans, and 6
online briefing
other topics.
Shenzhen Qianhai
Juntong Tianxia
Asset Management
Co., Ltd., CIB
Securities Co., Ltd.,
Shenzhen
Yunzhong
Chuangrong
Investment Co.,
Ltd., China Galaxy
Securities Co., Ltd.,
The
Shenzhen Qianhai
Company's https://irm.cni
Conference Yujin Investment
operating nfo.com.cn/ir
March 28, room, FIYTA On-site Instituti Management Co.,
conditions, cs/search?ke
development yword=00002
Building Minfeng Private
plans, and 6
Equity Fund
other topics.
Management Co.,
Ltd., Beijing
Fangyuan Jinding
Investment
Management Co.,
Ltd., Asia Pacific
Huijin Fund
Management
(Shenzhen) Co.,
Ltd., Jingcheng
Capital
Shenzhen Qianhai
Hengjiang United
Investment
The
Management Co.,
Company's https://irm.cni
Conference Ltd., Factorial
operating nfo.com.cn/ir
room, FIYTA On-site Instituti Happiness (Hong
April 3, 2025 conditions, cs/search?ke
Technology research on Kong) Fund
development yword=00002
Building Limited, Shenzhen
plans, and 6
Chuanghua
other topics.
Investment
Consulting Co.,
Ltd., Shenzhen
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Guocheng
Investment
Consulting Co.,
Ltd., Guangdong
Listed Companies
Research
Association,
Shenzhen Dexun
Securities
Consultant Co.,
Ltd., Hunan Aiying
Securities
Investment Advisor
Co., Ltd., Shenzhen
Desheng Financial
Holding Group Co.,
Ltd., Far East
Horizon Limited,
Fullgoal Fund
Management Co.,
Ltd.
Bosera Asset
Management Co.,
Ltd., Beijing
Zhishun Investment
Management Co.,
Ltd., Dajia Asset
Management Co.,
Ltd., Guangdong
Zhengyuan Private
Equity Fund
Management Co.,
Ltd., China Life
AMC Company
Limited, Guotai
Haitong Securities The
Co., Ltd., HFT Company's
Investment business https://irm.cni
Telephone Telephone Management Co., operations, nfo.com.cn/ir
Instituti
June 6, 2025 and online communicatio Ltd., HETAI Life development cs/search?ke
on
conference n Insurance Co., Ltd., plans, yword=00002
Hengyue Fund proposed 6
Management Co., acquisition
Ltd., Hongtu projects, etc.
Innovation Fund
Management Co.,
Ltd., HSBC Jintrust
Fund Management
Co., Ltd., CCB
Fund Management
Co., Ltd., China
Southern Asset
Management Co.,
Ltd., Lion Fund
Management Co.,
Ltd., Penghua Fund
Management Co.,
Ltd., Ping An Fund
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Management Co.,
Ltd., Ping An
Wealth
Management Co.,
Ltd., Ruirui
Investment
Management
(Shanghai) Co.,
Ltd., Shanghai
Haoxiang Asset
Management Co.,
Ltd., Shanghai
Chaos Investment
(Group) Co., Ltd.,
Shanghai Mingyu
Asset Management
Co., Ltd., Shanghai
Panwen Investment
Management Co.,
Ltd., Shanghai
Ruijun Asset
Management Co.,
Ltd., Shanghai
Ruisheng Private
Equity Fund
Management
Center (Limited
Partnership),
Shanghai Tuling
Asset Management
Co., Ltd., Shanghai
Chongyang
Investment
Management Co.,
Ltd., SAIC Qizhen
(Shanghai) Asset
Management Co.,
Ltd., SWS MU
Asset Management
Co., Ltd., Shenzhen
Jufeng Capital
Management Co.,
Ltd., Pacific Asset
Management Co.,
Ltd., Taishan
Property & Casualty
Insurance Co., Ltd.,
Tongtai Fund
Management Co.,
Ltd., Tibet YinFan
Investment
Management Co.,
Ltd., Xinjiang
Qianhai United
Fund Management
Co., Ltd.,
Xingzheng Global
Fund Management
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Co., Ltd., Xun Yuan
Asset Management
(Shanghai) Co.,
Ltd., Yinhua Fund
Management Co.,
Ltd., China
International Capital
Corporation
Limited, Zhong Ou
Asset Management
Co., Ltd., Zhuhai
Hengqin Wanfang
Private Equity Fund
Management
Partnership (Limited
Partnership),
Fidelity
Investments,
KITMC
Guotai Haitong
Securities Co., Ltd.,
Shenwan Hongyuan
Securities Co., Ltd.,
Gao Yi Asset
Management, LLP,
Qianhai United
Fund Management
Co., Ltd.,
Southwest
Securities Co., Ltd.,
Ping An Fund
Management Co.,
Ltd., Hongtu
Innovation Fund
Management Co., The
Ltd., China Fortune Company's
Securities Co., Ltd., business https://irm.cni
Telephone Telephone Western Securities operations, nfo.com.cn/ir
June 13, Instituti
and online communicatio Co., Ltd., Baoying development cs/search?ke
conference n Fund Management plans, yword=00002
Co., Ltd., Shanghai proposed 6
Ruisheng acquisition
Investment projects, etc.
Management Co.,
Ltd., Shanghai
Haoxiang Asset
Management Co.,
Ltd., Lion Fund
Management Co.,
Ltd., Northeast
Securities Co., Ltd.,
CITIC-Prudential
Fund Management
Company Limited,
Qiming Weichuang
Venture Capital
Management
(Shanghai) Co.,
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Ltd., Ping An
Securities Co., Ltd.,
Huitianfu Fund
Management Co.,
Ltd., Shanghai Yiye
Investment Co.,
Ltd., Zhejiang
Weixing Asset
Management Co.,
Ltd., Ping An Asset
Management Co.,
Ltd.
The
Company's
business https://irm.cni
Conference
HuaAn Securities operations, nfo.com.cn/ir
September 1, room, FIYTA On-site Instituti
Co., Ltd., Caitong development cs/search?ke
Securities Co., Ltd. plans, yword=00002
Building
proposed 6
acquisition
projects, etc.
The
Company's
Guotai Haitong business https://irm.cni
Conference
Securities Co., Ltd., operations, nfo.com.cn/ir
September 9, room, FIYTA On-site Instituti
CCB Fund development cs/search?ke
Management Co., plans, yword=00002
Building
Ltd. proposed 6
acquisition
projects, etc.
Investors who The
participated Company's
FIYTA Hi-
remotely in the business https://irm.cni
tech Building
Company's 2025 operations, nfo.com.cn/ir
November conference
Others Others Online Collective development cs/search?ke
Reception Day for plans, yword=00002
Q&A with
Listed Companies proposed 6
investors
in the Shenzhen acquisition
Jurisdiction projects, etc.
XIII. Formulation and implementation of the market value management system
and valuation enhancement plan
Whether the Company has established a market value management system.
Yes
Whether the Company has disclosed plans for valuation boost.
No
The Company's Proposal on Formulating the Company's "Market Value Management System" was reviewed
and approved at the 13th meeting of the 11th Board of Directors held on January 29, 2026. To strengthen the
Company's market value management, promote the enhancement of its investment value, and increase investor
returns, the Company has formulated the "Market Value Management System" in accordance with relevant
regulations such as the Regulatory Guidelines for Listed Companies No. 10 - Market Value Management. For
details, please refer to the Company's "Market Value Management System" disclosed on Cninfo on January 31,
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
XIV. Implementation of the action plan of "Dual Enhancement of Quality and
Returns"
Whether the company has disclosed the announcement of the action plan of "double improvement of quality and
returns".
No
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 4 Corporate Governance, Environment and Society
I. Basic status of corporate governance
The company has established a corporate governance structure comprising the Shareholders’ General Meeting,
the Board of Directors, and the management in strict accordance with laws and regulations including the Company
Law, the Securities Law, and the Corporate Governance Guidelines for Listed Companies. This structure operates
in accordance with the responsibilities defined in the Company’s Articles of Association, with clear delineation of
authority and coordinated functioning. During the reporting period, the company actively promoted the proper
performance of duties by the Shareholders’ General Meeting, the Board of Directors, and the management in
compliance with relevant laws, regulations, and the Company’s Articles of Association. All operational matters were
decided in accordance with statutory procedures to mitigate operational risks and continuously enhance
governance standards. The company’s governance status complies with the provisions of the Company Law and
relevant regulations of the China Securities Regulatory Commission.
The Shareholders’ General Meeting is the highest authority of the company. In accordance with the Company’s
Articles of Association, it makes resolutions on matters such as the election and replacement of directors, director
remuneration, the Board of Directors’ report, profit distribution plans, forecasted related-party transactions,
forecasted guarantees, amendments to the Articles of Association, the selection of accounting firms, and
acquisitions.
The Board of Directors plays a role in “setting strategy, making decisions, and preventing risks.” It is responsible
for implementing resolutions of the Shareholders’ General Meeting, convening the Shareholders’ General Meeting
and reporting to it, and making resolutions on matters such as the company’s medium- and long-term development
plans, business plans and investment proposals, the appointment and replacement of senior management, senior
management compensation, information disclosure, and internal audits, in accordance with the Company’s Articles
of Association. The Board of Directors consists of nine directors, including three independent directors. It has
established three committees: the Strategy and ESG Committee, the Audit Committee, and the Nomination,
Remuneration, and Appraisal Committee. These committees provide scientific and professional recommendations
to support the Board’s decision-making, with the Audit Committee exercising the functions and powers of a
Supervisory Board as stipulated in the Company Law.
Under the leadership and authorization of the Board of Directors, the management is responsible for presiding over
the company’s production, operation, and management activities, organizing the implementation of Board
resolutions, and reporting to the Board.
Whether there were any material discrepancies between the actual state of the Company's governance and the
provisions concerning the governance of listed companies as stipulated in laws, administrative regulations, and
rules issued by the China Securities Regulatory Commission?
No
II. The Company's Independence from the Controlling Shareholder and Actual
Controller in Terms of Assets, Personnel, Finances, Organization, and Business
The Company has strictly maintained the "Five Separations" from its controlling shareholder in terms of
business, personnel, assets, organization, and finance, and possesses independent and complete business
operations and autonomous management capabilities.
Business: The Company's main business is the watch industry, with independent production, auxiliary
production, supporting facilities, and procurement and sales systems. There is no horizontal competition between
the Company and its controlling shareholder.
Personnel: The Company has independent organizations and sound systems for labor, human resources, and
salary management. Except for Directors Deng Jianghu and Guo Gaohang, who hold positions in the shareholder's
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
entity, no other directors or senior management personnel hold dual positions in the shareholder's entity. No
financial personnel hold concurrent positions in affiliated companies.
Assets: The Company has clear property rights separate from its controlling shareholder and enjoys
independent legal person property rights over its assets. The Company's assets are completely independent of the
controlling shareholder, and the Company independently owns trademarks such as "FIYTA" and "Harmony."
Organization: The Company's Board of Directors and other internal organizations are well-established and
operate independently. There is no subordinate relationship with or co-location of offices with the functional
departments of the controlling shareholder. The controlling shareholder exercises its rights and assumes
corresponding obligations in accordance with the law, and there have been no instances of directly or indirectly
intervening in the Company's business activities by bypassing the Shareholders' Meeting.
Finance: The Company has established an independent finance department, a sound and independent
financial accounting system, and financial management regulations. It maintains its own independent bank
accounts, and the controlling shareholder does not interfere in the Company's financial and accounting activities.
III. Horizontal Competition
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
IV. Directors and Senior Management
Increase Decreas
Shares in e in Other
Shares
Held at Sharehol Shareho Changes
Held at Reason for
Gen Ag Statu Beginnin ding lding in
Name Position Start Date of Term End Date of Term End of Change in
der e s g of During During Sharehol
Period Shareholding
Period the the ding
(shares)
(shares) Period Period (shares)
(shares) (shares)
Zhou Chairman of Pres September 5,
Male 53 November 25, 2025 0 0 0 0 0
Jinqun the Board ent 2027
Deng
Pres September 5,
Jiangh Male 42 Director September 8, 2021 0 0 0 0 0
ent 2027
u
Guo
Pres September 5,
Gaoha Male 39 Director December 28, 2023 0 0 0 0 0
ent 2027
ng
Pres September 5,
Director February 24, 2021
Pan ent 2027
Male 50 230,050 0 0 0 230,050
Bo General Pres September 5,
January 15, 2021
Manager ent 2027
Shares were
Employee reduced before
Cao Fem Pres September 5,
Ping ale ent 2027
ive Director role of Employee
Director.
Wang
Independen Pres September 5,
Sushe Male 57 September 6, 2024 0 0 0 0 0
t Director ent 2027
ng
Wang
Independen Pres September 5,
Wenb Male 44 September 6, 2024 0 0 0 0 0
t Director ent 2027
o
Cao
Independen Pres September 5,
Guang Male 58 September 6, 2024 0 0 0 0 0
t Director ent 2027
zhong
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Lu
General Pres September 5,
Wanju Male 59 October 25, 2021 160,050 0 0 0 160,050
Counsel ent 2027
n
Liu Deputy
Pres September 5,
Xiaomi Male 55 General October 17, 2016 160,050 0 0 0 160,050
ent 2027
ng Manager
Deputy
Li Pres September 5,
Male 53 General October 17, 2016 160,090 0 0 0 160,090
Ming ent 2027
Manager
Chief
Pres September 5,
Financial February 6, 2022
Song ent 2027
Officer
Yaomi Male 59 0 0 0 0 0
Secretary to
ng Pres September 5,
the Board April 21, 2022
ent 2027
of Directors
Tang Deputy
Pres September 5,
Haiyu Male 53 General September 29, 2019 107,550 0 0 0 107,550
ent 2027
an Manager
Zhang Chairman of Resi
Male 49 July 1, 2021 October 28, 2025 0 0 0 0 0
Xuhua the Board gned
Li Resi
Male 40 Director February 24, 2021 March 12, 2026 0 0 0 0 0
Peiyin gned
Wang Resi September 22,
Male 47 Director September 6, 2024 0 0 0 0 0
Bo gned 2025
Chairman of
the Board Resi September 10,
January 4, 2024
Hu Fem of gned 2025
Min ale Supervisors
Resi September 10,
Supervisor December 28, 2023
gned 2025
Yuan Resi September 10,
Male 46 Supervisor December 28, 2023 0 0 0 0 0
Tianbo gned 2025
Employee
Hu Fem Representat Resi September 10,
Jing ale ive gned 2025
Supervisor
Total -- -- -- -- -- -- 853,510 0 26,720 0 826,790 --
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Whether there were any cases of directors and senior management leaving their posts during their term of office in
the reporting period.
In September 2025, the Company received a written resignation report from Director Mr. Wang Bo. Due to a
work adjustment, Mr. Wang Bo applied to resign from his positions as a director of the 11th Board of Directors and
a member of the Nomination, Remuneration, and Appraisal Committee. After his resignation, he no longer holds
any position in the Company.
The Company's first extraordinary general meeting of 2025, held in September 2025, reviewed and approved
the Proposal on Amending the Articles of Association. In accordance with relevant laws and regulations, the
powers and functions of the original Board of Supervisors were adjusted to be exercised by the Audit Committee of
the Board of Directors. Ms. Hu Min, Mr. Yuan Tianbo, and Ms. Hu Jing ceased to serve as supervisors of the
Company from the date of approval by the Shareholders' Meeting.
In October 2025, the Company received a written resignation report from Chairman Zhang Xuhua. Due to a
work adjustment, Mr. Zhang Xuhua resigned from his positions as a director, Chairman of the 11th Board of
Directors, and Chairman of the Strategy and ESG Committee. After his resignation, he no longer holds any position
in the Company.
In March 2026, the Company received a written resignation report from Director Li Peiyin. Due to a work
adjustment, Mr. Li Peiyin resigned from his positions as a director of the 11th Board of Directors and a member of
the Audit Committee. After his resignation, he no longer holds any position in the Company.
Changes in the Company's directors and senior management
Name Position held Type Date Reason
Elected as a non-independent director of the 11th
November 25,
Director Elected Board of Directors of the Company at the second
Zhou extraordinary general meeting of 2025.
Jinqun Elected as the Chairman of the Board at the 12th
Chairman of November 25,
Elected meeting of the 11th Board of Directors of the
the Board 2025
Company.
Employee Elected as an employee representative director of
Cao September 22,
Representativ Elected the 11th Board of Directors of the Company at the
Ping 2025
e Director first employee representatives' congress of 2025.
Zhang Chairman of Resigne
October 28, 2025 Work transfer
Xuhua the Board d
Wang Resigne September 22,
Director Work transfer
Bo d 2025
Li Resigne
Director March 12, 2026 Work transfer
Peiyin d
Professional background, main work experience, and current primary responsibilities of the Company's current
directors and senior management
Mr. Zhou Jinqun, born in March 1973, is of Chinese nationality with no right of permanent residence abroad.
He holds a bachelor's degree and an EMBA from China Europe International Business School. He currently serves
as the Chairman of the Board of the Company. He has served as Managing Director, Deputy General Manager,
Assistant to the General Manager, Manager of the Manager Department, Assistant to the Chief Engineer, and
Production Process Engineer at Shennan Circuits Co., Ltd.; Executive Director and General Manager at Wuxi
Shennan Circuits Co., Ltd.; Executive Director and General Manager at Nantong Shennan Circuits Co., Ltd.; and
Director at Shanghai Heying Industrial Co., Ltd.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Mr. Deng Jianghu, born in July 1984, holds a Master's degree in Business Administration from Northeast
Normal University. He is currently a Director of the Company, Head of the Business Management Department of
AVIC INNO, a Director of Tianma Microelectronics Co., Ltd., a Director of Shennan Circuits Company Limited, a
Director of AVIC Huadong Photoelectric Co., Ltd., and Chairman of Shenzhen ZONFA Machinery Co., Ltd. He
previously served as Manager and Deputy Manager of the Planning and Operation Department of the Company,
Director of the Modern Service Industry Office of AVIC Shenzhen Company Limited, and Senior Project Manager of
Strategic Operation Management in the Strategic Development Department of Shennan Circuits Co., Ltd.
Mr. Guo Gaohang, born in March 1987, holds a Master's degree in Materials Physics and Chemistry from
Harbin Institute of Technology. He is currently a Director of the Company, Head of the Planning and Development
Department of AVIC INNO, a Director of AVIC International Supply Chain Technology Ltd., a Director of Tianma
Microelectronics Co., Ltd., a Director of Shennan Circuits Company Limited, and a Director of Rainbow Digital
Commercial Co., Ltd. He previously served as Project Manager of Strategic Operation Management in the Planning
and Business Department of AVIC Shenzhen Company Limited, Senior Semiconductor Industry Analyst and
Semiconductor Industry Analyst at TrendForce Corp. (Shenzhen), and Packaging and Testing Process Design
Engineer at Shenzhen STS Microelectronics Co., Ltd.
Mr. Pan Bo, born in March 1976, is an engineer and holds a Bachelor's degree in Mechatronic Engineering
from Beihang University and an EMBA from China Europe International Business School. He is currently the
Director and General Manager of the Company. He previously served as Deputy General Manager, Secretary to
the Board of Directors, and Assistant to the General Manager of the Company, and as General Manager, Deputy
General Manager, Assistant to the General Manager, Sales Department Manager, and Logistics Department
Manager of FIYTA Sales Co., Ltd.
Ms. Cao Ping, born in December 1981, holds a Bachelor's degree in Journalism from Hubei University. She is
currently an Employee Representative Director of the Company, Head of the Party Building and Publicity
Department, Head of the Human Resources Department, and Vice Chairman of the Labor Union. She previously
served as Editor of the internal publication and Party Affairs Supervisor of Shenzhen CATIC Group, and as
Assistant to the Head, Deputy Head, and Head of the General Administration Department of the Company.
Mr. Wang Susheng, born in March 1969, is a Certified Public Accountant and holds a Doctor of Law degree
from Peking University and an MBA from the University of Chicago. He is currently an Independent Director of the
Company, a professor at Southern University of Science and Technology, and an Independent Director of
Changyuan Technology Group Ltd., Dowell Service Group Co., Limited (02352.HK), and CALB Group Co., Ltd.
(03931.HK). He previously served as Head of the Economics and Management Department and a professor at the
Harbin Institute of Technology (Shenzhen Graduate School), and as a principal at China Development Bank Sino-
Swiss Venture Capital Fund Management Co., Ltd.
Mr. Wang Wenbo, born in December 1982, holds a Doctoral degree in Marketing from New York University.
He is currently an Independent Director of the Company, an Associate Professor, a tenured professor, and a
doctoral supervisor at the School of Business of The Hong Kong University of Science and Technology, an
Independent Director of Haoxiangni Health Food Co., Ltd., an Executive Director of Zhuhai Ruixing Management
Consulting Co., Ltd., and Chief Scientific Advisor of Guangdong Huanxun Information Co., Ltd. He previously
served as a professor on the scientific committee of the WeBank x HKUST Joint Lab and as a technical expert
consultant for several leading companies in the industry.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Mr. Cao Guangzhong, born in May 1968, holds a Doctoral degree in Mechatronic Engineering from Xi'an
Jiaotong University. He is currently an Independent Director of the Company, a professor at Shenzhen University,
and an Independent Director of Shenzhen Xinghe Automation Co., Ltd. He also serves as a standing committee
member of the Microcomputer Application Society of the China Instrument and Control Society, a standing director
of the Guangdong Association of Automation, a director of the Guangdong Association for Artificial Intelligence and
Robotics, Vice Chairman of the Shenzhen Robotics Association, and a review expert for the National Natural
Science Foundation of China, the Ministry of Science and Technology, the Ministry of Industry and Information
Technology, and the Guangdong Provincial Department of Science and Technology. He previously served as an
associate professor in Mechatronics at Xi'an Jiaotong University, a postdoctoral researcher at the Korea Advanced
Institute of Science and Technology (KAIST), and an Independent Director of Shenzhen KORAD Technology Co.,
Ltd.
Mr. Lu Wanjun, born in February 1967, is an accountant and holds an EMBA from China Europe International
Business School. He is currently the General Counsel of the Company. He previously served as Deputy General
Manager and Assistant to the General Manager of the Company, and as Executive Deputy General Manager,
Deputy General Manager, and Assistant to the General Manager and Finance Department Manager of Shenzhen
Harmony World Watch Center Co., Ltd.
Mr. Liu Xiaoming, born in July 1971, is an engineer and economist, and holds a Bachelor's degree in
Manufacturing Engineering from Beihang University and an EMBA from China Europe International Business
School. He is currently a Deputy General Manager of the Company. He previously served as Assistant to the
General Manager of the Company, and as Deputy General Manager and Assistant to the General Manager of
Shenzhen Harmony World Watch Center Co., Ltd.
Mr. Li Ming, born in September 1973, holds a Bachelor's degree in Marketing from Zhongnan University of
Economics and Law and an EMBA from China Europe International Business School. He is currently a Deputy
General Manager of the Company. He previously served as Assistant to the General Manager and Human
Resources Director of the Company, and as Deputy General Manager and Assistant to the General Manager and
Human Resources Department Manager of Shenzhen Harmony World Watch Center Co., Ltd.; human Resources
Director and General Manager of the Marketing Center at China Netcom Shenzhen Branch; key Account Manager
and Marketing Planning Manager at China Telecom Shenzhen Branch.
Mr. Song Yaoming, born in July 1967, is a senior accountant and holds a Master's degree in Economics from
Shaanxi Institute of Finance and Economics and an EMBA from China Europe International Business School. He is
currently the Chief Financial Officer and Secretary to the Board of Directors of the Company. He previously served
as Deputy General Manager and Chief Financial Officer of Rainbow Digital Commercial Co., Ltd., a Director of
Shenzhen Aoxuan Investment Co., Ltd., a Director of Shenzhen Aoer Investment Development Co., Ltd., and
Deputy Manager and Accountant of the Finance Department of Shenyang Jinbei Automotive Company Limited.
Mr. Tang Haiyuan, born in February 1973, is a professor-level senior engineer and holds a Bachelor's degree
in Plastic Forming Process and Equipment from Hefei University of Technology and an EMBA from China Europe
International Business School. He is currently a Deputy General Manager of the Company. He previously served
as General Manager, Deputy General Manager, Assistant to the General Manager, Quality Department Manager,
Engineering Technology Department Manager, and Deputy Manager of Shenzhen FIYTA Precision Timing
Manufacturing Co., Ltd., and as Assistant to the Technical General Manager and Technical Department Manager
of Shenzhen FIYTA Technology Development Co., Ltd.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Cases where the controlling shareholder or actual controller concurrently serves as both Chairman and General
Manager of the listed company
Not applicable
Positions held in the shareholder's entity
Whether
remuneration or
Name Position held in
Name of the allowances are
of the the
shareholder's Start Date of Term End Date of Term received from
appoint shareholder's
entity the
ee entity
shareholder's
entity
Head of the
Deng AVIC Innovation Business
January 8, 2025 Yes
Jianghu Holding Limited Management
Department
Head of the
Guo
AVIC Innovation Planning and
Gaohan October 27, 2025 Yes
Holding Limited Development
g
Department
Explan
ation of
position
s held
Not applicable
in the
shareh
older's
entity
Positions held in other entities
Whether
remuner
ation and
Name Position
allowanc
of the held in
Name of the other entity Start Date of Term End Date of Term es are
appoint the other
received
ee entity
from
other
entities
Tianma Microelectronics Co., November 29,
Director No
Ltd. 2021
Shennan Circuits Co., Ltd. Director April 7, 2022 No
Deng
AVIC Huadong Photoelectric November 27,
Jiangh Director No
Co., Ltd. 2023
u
Chairman
CASTIC SMP Machinery Corp., December 30,
of the No
Ltd. 2024
Board
AVIC International Supply November 27,
Director No
Chain Technology Co., Ltd. 2023
Guo
Tianma Microelectronics Co.,
Gaoha Director March 6, 2024 No
Ltd.
ng
Shennan Circuits Co., Ltd. Director April 18, 2024 No
Rainbow Digital Commercial Director October 15, 2024 No
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Co., Ltd.
Southern University of Science
Professor April 1, 2017 Yes
and Technology
Independ
Dowell Service Group Co., December 13,
ent Yes
Limited (02352.HK) 2020
Wang Director
Sushen Independ
Changyuan Technology Group
g ent August 9, 2021 Yes
Ltd.
Director
Independ
CALB Group Co., Ltd.
ent October 6, 2022 Yes
(03931.HK)
Director
Associate
Professor
School of Business, The Hong , tenured
Kong University of Science and professor, July 2, 2018 Yes
Technology doctoral
superviso
r
Wang
Independ
Wenbo Haoxiangni Health Food Co.,
ent October 15, 2025 Yes
Ltd.
Director
Chief
Guangdong Huanxun
Scientific November 1, 2025 Yes
Information Co., Ltd.
Advisor
Zhuhai Ruixing Management Executive
March 26, 2024 No
Consulting Co., Ltd. Director
Shenzhen University Professor February 29, 2000 Yes
Cao
Independ
Guang Shenzhen Xinghe Automation
ent October 16, 2020 Yes
zhong Co., Ltd.
Director
Explan
ation of
positio
Not applicable
ns held
in other
entities
Penalties imposed by securities regulatory authorities on the Company's current and departed directors and senior
management in the last three years
Not applicable
Decision-making procedures, basis for determination, and actual payment of remuneration for directors and senior
management
The remuneration for the Company's internal directors and the allowances for independent directors are
implemented upon approval by the general meeting of shareholders. Other external directors do not receive
remuneration from the Company. The remuneration for senior management is implemented upon approval by the
Board of Directors.
Remuneration of directors and senior management during the reporting period
Unit: CNY 10000
Name Gende Ag Position Status Annual Social Total pre- Whether
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
r e Remuneratio Insurance, tax remuneratio
n Enterprise remuneratio n is
(Note 1) Annuity, n received received
Housing from the from the
Provident Company Company's
Fund, and related
Other parties
Employer
Contributio
ns
(Deposits)
Zhou Chairman of Yes (Note
Male 53 Present 14.88 3.07 17.95
Jinqun the Board 2)
Deng
Male 42 Director Present 0 0 0 Yes
Jianghu
Guo
Male 39 Director Present 0 0 0 Yes
Gaohang
Managing
Pan Bo Male 50 Present 133.33 15.33 148.66 No
Director
Employee
Femal
Cao Ping 45 Representati Present 79.70 13.58 93.28 No
e
ve Director
Wang Independent
Male 57 Present 9 0 9 No
Susheng Director
Wang Independent
Male 44 Present 9 0 9 No
Wenbo Director
Cao
Independent
Guangzhon Male 58 Present 9 0 9 No
Director
g
General
Lu Wanjun Male 59 Present 135.80 15.33 151.13 No
Counsel
Deputy
Liu
Male 55 General Present 171.80 15.33 187.13 No
Xiaoming
Manager
Deputy
Li Ming Male 53 General Present 131.30 15.23 146.53 No
Manager
Chief
Financial
Song Officer and
Male 59 Present 138.30 15.33 153.63 No
Yaoming Secretary to
the Board of
Directors
Deputy
Tang
Male 53 General Present 132.30 13.66 145.96 No
Haiyuan
Manager
Zhang Chairman of Resigne Yes (Note
Male 49 135.84 13.33 149.17
Xuhua the Board d 3)
Resigne
Li Peiyin Male 40 Director 0 0 0 Yes
d
Resigne
Wang Bo Male 47 Director 0 0 0 Yes
d
Chairman of
Femal Resigne
Hu Min 41 the Board of 0 0 0 Yes
e d
Supervisors
Yuan Resigne
Male 46 Supervisor 0 0 0 Yes
Tianbo d
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Employee
Femal Resigne
Hu Jing 55 Representati 31.95 10.13 42.08 No
e d
ve Supervisor
Total -- -- -- -- 1,132.20 130.32 1,262.52 --
Note 1: The annual remuneration includes the 2025 basic annual salary and a portion of the performance-based
annual salary, as well as the deferred portion of the 2024 performance-based annual salary determined based on
the operating results.
Note 2:From January to October 2025, Mr. Zhou Jinqun served and received remuneration from Shennan Circuits
Company Limited, a related party of the Company.
Note 3: From November to December 2025, Mr. Zhang Xuhua served and received remuneration from AVIC INNO,
a related party of the Company.
It is determined in accordance with the Company ’ s
Basis for assessing the actual remuneration received Administrative Measures on Remuneration for
by all directors and senior management at the end of Management Members, Measures on Employee
the reporting period Remuneration Administration, and other relevant
regulations.
Completion of the assessment for the actual
remuneration received by all directors and senior The assessment has been completed.
management at the end of the reporting period
for non-independent directors (excluding employee
directors) and senior management is determined and
Deferred payment arrangements for the actual paid according to the results of their business
remuneration received by all directors and senior performance assessment.
management at the end of the reporting period 2. A certain proportion of the annual remuneration of
the Company ’ s Chairman and General Manager is
deferred as a risk reserve, to be paid based on the
results of the term audit.
Clawback status of the actual remuneration received by
all directors and senior management at the end of the Not applicable
reporting period
Other notes
Not applicable
V. Performance of duties by directors during the reporting period
Attendance of directors at Board and Shareholders' Meetings
Number of
Number of Whether
Board
Number of Board Number of Number of absent Number of
Meetings
Board Meetings Board Board from two Sharehold
required to
Name of director Meetings attended Meetings Meetings consecutiv ers'
attend
attended by attended unattende e Board Meetings
during the
in person telecomm by proxy d Meetings attended
reporting
unication in person
period
Zhou Jinqun 1 0 1 0 0 No 0
Deng Jianghu 8 3 5 0 0 No 0
Guo Gaohang 8 4 4 0 0 No 0
Pan Bo 8 4 4 0 0 No 1
Cao Ping 4 0 4 0 0 No 0
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Wang Susheng 8 4 4 0 0 No 2
Wang Wenbo 8 4 4 0 0 No 1
Cao Guangzhong 8 4 4 0 0 No 1
Zhang Xuhua
(Resigned)
Li Peiyin
(Resigned)
Wang Bo
(Resigned)
Explanation for not attending two consecutive Board Meetings in person
Not applicable
Whether directors raised objections to company matters
No
Whether suggestions from directors on company matters were adopted
Yes
Explanation on whether suggestions from directors on company matters were adopted
During the reporting period, the Board of Directors fully leveraged its role in "setting strategy, making decisions
and preventing risks." The Company's directors strictly adhered to laws and regulations such as the Company Law
and the Code of Corporate Governance for Listed Companies, as well as the provisions of the Articles of
Association. They attended Board Meetings on time, diligently fulfilled their duties and rights as directors, fully
deliberated on matters for resolution by the Board, provided advice and suggestions, and voted conscientiously.
The Company has fully considered and adopted the constructive suggestions put forward by the directors
regarding its development strategy, business management and other aspects.
VI. Activities of the special committees under the Board of Directors during the
reporting period
Key
Number Details of
opinions Other
Committee of Date of Meeting dissenting
Members and duties
name meeting meeting content matters (if
suggestion performed
s held any)
s
The
committee
Reviewed
Chairman members
and
(Note): Zhang engaged in
approved
Xuhua a full
the 2024
(Resigned) discussion
Strategy Annual
Members: March 12, on the
and ESG 2 Board of
Deng Jianghu, 2025 Company's
Committee Directors'
Guo developme
Work
Gaohang, Pan nt plan and
Report and
Bo, Wang other
the ESG
Wenbo matters,
Report.
suggesting
that the
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Company
should
continue to
strengthen
market
analysis,
accelerate
strategic
transformat
ion and
upgrading,
and
enhance its
level of
technologic
al
innovation.
The
committee
members
Reviewed agreed for
and the
approved Company
the to sign the
proposal on equity
the acquisition
intended intention
June 4, signing of agreement
acquisition continue
intention advancing
agreement the project
and to acquire
related- a
party controlling
transaction. stake in
Changkong
Gear
Company.
The The
following committee
were members
reviewed discussed
Chairman: and matters
Wang approved: such as the
Susheng 2024 Company's
Members: Li Annual internal
Peiyin Report, and
Audit March 12,
(resigned), 5 2024 external
Committee 2025
Guo Annual audit work
Gaohang, Financial and
Wang Wenbo, Final internal
Cao Accounts control
Guangzhong Report, manageme
Annual suggesting
Profit that the
Distribution Company
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Plan, 2025 should
Forecast of strengthen
Routine risk
Related- manageme
Party nt.
Transaction
s, 2025
Forecast of
Total Bank
Credit and
Loan
Quota,
Forecast of
Guarantee
Quota for
Subsidiarie
s, 2024
Annual
Internal
Control
Self-
Evaluation
Report,
Internal
Audit Work
Report,
Annual
Internal
Audit Work
Report, and
Annual
Performanc
e
Evaluation
Report of
the
Accounting
Firm and
Audit
Committee
Report on
Supervising
the
Performanc
e of the
Accounting
Firm.
The
following
were
April 23,
reviewed
and
approved:
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Report and
Internal
Audit Work
Report.
The
following
were
reviewed
and
approved:
August 22,
Annual
Report and
Internal
Audit Work
Report.
The
following
were
reviewed
and
October 23, approved:
Report and
Internal
Audit Work
Report.
Re-
appointmen
t of the
November accounting
reviewed
and
approved.
The
proposal on
the
remunerati
on of
Chairman: directors
March 12,
Cao and senior
Nomination Guangzhong manageme
, Members: nt for 2024
Remunerati Deng Jianghu, was
on and Guo reviewed
Appraisal Gaohang, and
Committee Wang Wenbo, approved.
Wang The
Susheng proposal on
the by-
October 23,
election of
members
to the
Nomination
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
,
Remunerati
on and
Appraisal
Committee
was
reviewed
and
approved.
The
proposal on
the
proposed
October 28, change of
was
reviewed
and
approved.
The
proposal on
the election
of the
Chairman
and the
election of
November members
Strategy
and ESG
Committee
was
reviewed
and
approved.
Note: At the 12th meeting of the 11th Board of Directors held on November 25, 2025, the Company elected Mr.
Zhou Jinqun as the Chairman of the Strategy and ESG Committee of the Board of Directors.
VII. Work of the Audit Committee
Whether the Audit Committee identified any risks to the Company during its supervisory activities in the reporting
period
No
VIII. Company Employees
Number of active employees at the parent company at
the end of the reporting period (persons)
Number of active employees at major subsidiaries at
the end of the reporting period (persons)
Total number of active employees at the end of the
reporting period (persons)
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Total number of employees receiving remuneration
during the period (persons)
Number of retired employees for whom the parent
company and major subsidiaries are responsible for 0
expenses (persons)
Discipline structure
Category of discipline structure Number of employees by discipline (persons)
Production personnel 291
Sales personnel 2,072
Technical personnel 321
Financial personnel 96
Administrative personnel 376
Total 3,156
Education background
Category of education background Number (persons)
Master's degree or above 80
Bachelor's degree 681
Junior college degree 949
Below junior college degree 1,446
Total 3,156
In line with its business development plan and management practices, the Company adheres to the core
philosophy of value creation and has formulated its remuneration policy based on the principles of hierarchical
management, budgetary control, performance orientation, efficiency priority with due consideration to fairness,
positive incentives, and a long-term focus. We will continue to establish and improve a remuneration system that
includes an annual salary system for middle and senior management, a performance-based salary system for
employees, and a productivity-linked compensation system for production workers, and implement the following
management measures:
Total payroll management: We conduct annual remuneration budgeting in conjunction with the annual
business plan, and regulate the total remuneration by comprehensively considering factors such as market salary
levels, organizational efficiency improvements, and talent team adjustments, to achieve the management goals of
being benefit-oriented, providing positive incentives, implementing classified management, and regulating
distribution;
Classified and hierarchical management: We establish a differentiated position and rank system based on job
characteristics, and on this basis, we establish a matching and standardized remuneration framework in line with
market conditions;
Value-oriented, co-creation and sharing: The Company designs its incentive system in a closed loop of value
creation, evaluation, and distribution. By establishing a value evaluation system and a real-time incentive system
consistent with its strategic development goals, it has formed an incentive mechanism where remuneration rises
and falls with the Company's performance and individual performance, and incremental remuneration is tilted
towards core key positions and high-performing talents.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Talent is the primary productive force for the Company's development. The Company attaches great
importance to the development and training of talent. To cultivate a high-quality talent team, support the
implementation of the Company's strategy, and create an organizational learning atmosphere, the Company has
formulated the "Employee Training Management System," established a comprehensive and systematic employee
learning and growth system, and built an online learning platform and offline training centers to provide employees
with continuous growth opportunities.
For details, please refer to Chapter 7 on employee training and development in the "2025 Environmental,
Social and Governance (ESG) Report" disclosed by the Company on Cninfo on March 14, 2026.
Not applicable
IX. Company's profit distribution and conversion of capital reserve into share
capital
Formulation, implementation, or adjustment of the profit distribution policy, especially the cash dividend policy,
during the reporting period
The Company's 2024 profit distribution plan was approved at the fifth meeting of the 11th Board of Directors
held on March 12, 2025, and the 2024 Annual Shareholders' Meeting held on April 10, 2025. It was resolved that,
based on the total share capital on the record date for the future implementation of the profit distribution plan, a
cash dividend of 4.00 yuan (tax included) per 10 shares will be distributed to all shareholders, with 0 bonus shares
and no conversion of capital reserve into share capital.
The Company's total share capital did not change during the period from the disclosure of the distribution plan
to its implementation. Based on a total share capital of 405,764,007 shares, the Company distributed a cash
dividend of 4.00 yuan (tax included) per 10 shares to all shareholders, with a total cash dividend amount of
This profit distribution plan was fully implemented on May 30, 2025. For details, please refer to the
"Announcement on the Implementation of the 2024 Equity Distribution 2025-016" disclosed by the Company on
Cninfo.
Special explanation of the cash dividend policy
Whether it complies with the provisions of the Articles of Association or the resolutions of the
Yes
Shareholders' Meeting:
Whether the dividend standard and ratio are clear and explicit: Yes
Whether the relevant decision-making procedures and mechanisms are complete: Yes
Whether the independent directors have fulfilled their duties and played their due role: Yes
If the Company did not distribute cash dividends, the specific reasons and the measures to be
Not applicable
taken to enhance investor returns should be disclosed:
Whether minority shareholders have sufficient opportunities to express their opinions and
Yes
demands, and whether their legitimate rights and interests have been fully protected:
In case the cash dividend policy is adjusted or changed, whether the conditions and
Not applicable
procedures are compliant and transparent:
The Company was profitable during the reporting period and the parent company's distributable profit to
shareholders was positive, but no cash dividend distribution plan was proposed
Not applicable
Profit distribution and conversion of capital reserve into share capital during this reporting period
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Bonus shares per 10 shares (shares) 0
Cash dividend per 10 shares (yuan) (tax included) 1.20
Shares converted from capital reserve per 10 shares
(shares)
Total share capital on the record date for the future
Share capital base for the distribution plan (shares)
implementation of the profit distribution plan
Cash dividend amount (yuan) (tax included) 48,691,680.84
Cash dividend amount by other means (e.g., share
repurchase) (yuan)
Total cash dividends (including other means) 48,691,680.84
Distributable profit (yuan) 1,692,530,114.77
Proportion of total cash dividends (including other
means) to total profit distribution
Cash dividend distribution for this period
Others
Detailed explanation of the profit distribution or capital reserve conversion plan
The Company's 2025 profit distribution plan was approved at the14th meeting of the 11th Board of Directors
held on March 12, 2026. It is proposed that, based on the total share capital on the record date for the future
implementation of the profit distribution plan, a cash dividend of 1.20 yuan (tax included) per 10 shares will be
distributed to all shareholders, with 0 bonus shares and no conversion of capital reserve into share capital.
If the Company's total share capital changes after the disclosure of this profit distribution plan and before its
implementation, the Company intends to adjust the total distribution amount according to the principle of a fixed
distribution ratio.
This profit distribution plan is subject to approval at the Shareholders' Meeting before implementation.
X. Implementation of the Company's equity incentive plans, employee stock
ownership plans, or other employee incentive measures
(1) 2018 A-share restricted stock incentive plan (Phase II)
The Company decided to launch the Phase II restricted stock incentive plan at the 23rd meeting of the 9th
Board of Directors held on December 4, 2020, and the first extraordinary general meeting of 2021 held on January
The Company ultimately granted 7.66 million A-share restricted stocks to 135 incentive participants at a grant price
of 7.60 yuan per share. This portion of restricted stocks was granted, registered, and listed on January 29, 2021.
For details, please refer to the relevant announcements disclosed on Cninfo on January 16, 2021. The specific
implementation during the reporting period is as follows:
As approved at the fourth meeting of the 11th Board of Directors, the conditions for the third vesting period of
the Company's Phase II restricted stock incentive plan have been met. The 2,047,420 A-share restricted stocks
subject to vesting were listed and became tradable on February 5, 2025. For details, please refer to the relevant
announcements disclosed by the Company on Cninfo on January 2 and January 23, 2025.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Equity incentives granted to directors and senior management
Unit: share
Numbe Number
r of Exercise Numb Number of Number
Number Number Number Market Number
stock price of er of of restricte of
of stock of of price at of Grant
options shares stock restricte d restricte
options exercisab shares the end of unlocke price of
newly exercised option d stocks stocks d
held at le shares exercise the d restricted
Name Position granted during the s held held at newly stocks
the during d during reporting shares stocks
during reporting at the the granted held at
beginnin the the period during (yuan/shar
the period end of beginnin during the end
g of the reporting reportin (yuan/shar the e)
reportin (yuan/shar the g of the the of the
year period g period e) period
g e) period period reportin period
period g period
Zhou Chairman of
Jinqun the Board
Deng
Director 0 0 0 0 0 0 0 0 0 0 0
Jianghu
Guo
Director 0 0 0 0 0 0 0 0 0 0 0
Gaohang
Managing
Pan Bo 0 0 0 0 0 0 0 50,100 50,100 0 0
Director
Employee
Cao Ping Representati 0 0 0 0 0 0 0 26,720 26,720 0 0
ve Director
Wang Independent
Susheng Director
Wang Independent
Wenbo Director
Cao
Independent
Guangzho 0 0 0 0 0 0 0 0 0 0 0
Director
ng
General
Lu Wanjun 0 0 0 0 0 0 0 50,100 50,100 0 0
Counsel
Deputy
Liu
General 0 0 0 0 0 0 0 50,100 50,100 0 0
Xiaoming
Manager
Deputy
Li Ming 0 0 0 0 0 0 0 50,100 50,100 0 0
General
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Manager
Chief
Financial
Song Officer and
Yaoming Secretary to
the Board of
Directors
Deputy
Tang
General 0 0 0 0 0 0 0 50,100 50,100 0 0
Haiyuan
Manager
Zhang
Chairman of
Xuhua 0 0 0 0 0 0 0 0 0 0 0
the Board
(Resigned)
Li Peiyin
Director 0 0 0 0 0 0 0 0 0 0 0
(Resigned)
Wang Bo
Director 0 0 0 0 0 0 0 0 0 0 0
(Resigned)
Total -- 0 0 0 0 -- 0 -- 277,220 0 -- 0
Appraisal mechanism and incentive plan for senior management
To establish and improve the incentive and restraint mechanisms for its senior management, fully motivate their enthusiasm, enhance the Company's operational
capabilities and economic benefits, and ensure the achievement of its strategic goals, the Company continuously refines its term-of-office and contract-based
management for senior management. It conducts performance evaluations based on annual/term-based business objectives and rigorously implements rewards and
punishments based on assessment results. This approach highlights strong incentives and strict constraints in remuneration, adheres to a performance-oriented
principle, and reinforces effective incentives through precise assessments.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Not applicable
Not applicable
XI. Establishment and implementation of the internal control system during the
reporting period
To strengthen its internal control, promote standardized operations and healthy development, and protect the
legitimate rights and interests of shareholders, the Company has established and improved its internal control
system in accordance with the Company Law, the Securities Law, and other laws and regulations, and this system
has been effectively implemented. During the reporting period, the Company had no material or significant
deficiencies in its internal control.
No
XII. Management and control of subsidiaries during the reporting period
Not applicable
Anomalies in the management and control of subsidiaries
No
XIII. Internal control evaluation report or internal control audit report
Full text disclosure date of the
March 14, 2026
internal control evaluation report
Full text disclosure index of the
www.cninfo.com.cn
internal control evaluation report
Proportion of total assets of entities
included in the evaluation scope to
the total assets in the Company's
consolidated financial statements
Proportion of operating revenue of
entities included in the evaluation
scope to the operating revenue in 100.00%
the Company's consolidated
financial statements
Deficiency identification standards
Category Financial reporting Non-financial reporting
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
(1) Serious violation of national
laws, administrative regulations, and
normative documents;
(1) The deficiency involves fraud (2) "Triple-Major and One-Large"
by directors or senior matters are not decided through
management; collective decision-making
(2) Correction of previously procedures;
disclosed financial statements; (3) Severe loss of key management
(3) The certified public accountant and technical personnel;
discovers a material misstatement (4) Lack of institutional control or
in the current financial statements systemic failure of institutions for
Qualitative standards
that was not detected by the important business activities related
internal control during its to the Company's production and
operation; operation;
(4) The supervision of internal (5) Failure of internal control over
control by the Company's Audit information disclosure, leading to
Committee and the Discipline public censure by regulatory
Inspection Department/Audit and authorities;
Legal Department is ineffective. (6) The results of the internal control
evaluation, especially material or
significant deficiencies, are not
rectified.
(1) Material deficiency: (1) Material deficiency:
Misstatement ≥ 5% of profit before Misstatement ≥ 5% of profit before
tax tax
(2) Significant deficiency: 1% of (2) Significant deficiency: 1% of
Quantitative standards profit before tax ≤ Misstatement < profit before tax ≤ Misstatement <
(3) General deficiencies: (3) General deficiencies:
Misstatement < 1% of profit before Misstatement < 1% of profit before
tax tax
Number of material weaknesses in
financial reporting (Nos)
Number of material weaknesses in
non-financial reporting (Nos)
Number of significant deficiencies
in financial reporting (Nos)
Number of significant deficiencies
in non-financial reporting (Nos)
Opinion paragraph in the internal control audit report
In our opinion, FIYTA has maintained, in all material respects, effective internal control over financial reporting
as of December 31, 2025, in accordance with the Basic Standard for Enterprise Internal Control and related
regulations.
Disclosure of the internal control audit report Disclosed
Full text disclosure date of the internal control audit
March 14, 2026
report
Full text disclosure index of the internal control audit
www.cninfo.com.cn
report
Type of opinion in the internal control audit report Standard unqualified opinion
Whether there are material weaknesses in non- No
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
financial reporting
Whether the accounting firm has issued a non-standard opinion on the internal control audit report
No
Whether the opinion in the internal control audit report issued by the accounting firm is consistent with that in the
Board of Directors' self-evaluation report
Yes
Whether a non-standard internal control audit opinion was issued for the reporting period or the previous year
No
XIV. Rectification of issues identified in the self-inspection of the special action
on corporate governance of listed companies
The Company has completed its self-inspection in accordance with the requirements of the CSRC's
Announcement on Launching a Special Action on the Governance of Listed Companies and has rectified the
issues identified during the self-inspection. The Company's corporate governance complies with the requirements
of laws and regulations such as the Company Law, the Securities Law, and the Code of Corporate Governance for
Listed Companies in China. The governance structure is relatively complete and its operations are standardized.
XV. Environmental information disclosure
Whether the listed company and its major subsidiaries are included in the list of enterprises required to disclose
environmental information by law
No
XVI. Social responsibility
For details, please refer to the "2025 Environmental, Social and Governance (ESG) Report" disclosed by the
Company on Cninfo (www.cninfo.com.cn) on March 14, 2026.
XVII. Consolidating and expanding the achievements of poverty alleviation and
rural revitalization
In collaboration with the Shanghai True Dream Public Welfare Foundation, the company has systematically
built and continues to operate standardized "Dream Centers" classrooms across multiple provinces in China. By
providing quality hardware facilities, supporting curriculum resources, and teacher training, the company aims to
establish a sustainable platform for competency-based education in schools located in regions with relatively
limited educational resources. Since the launch of the first Dream Center in Guizhou in 2012, a total of 37 Dream
Centers have been established across 12 provinces, benefiting 51,674 students cumulatively.
During the reporting period, in partnership with the China Foundation for Rural Development and the Shanghai
True Dream Public Welfare Foundation, the company constructed two new Dream Center classrooms in Puding
County, Anshun City, Guizhou Province. These classrooms are equipped with interactive facilities such as tablet
computers and modular desks and chairs, designed to support collaborative inquiry-based learning and integrate
digital learning through optimized hardware. The initiative has been praised by school teachers and students as
"the most colorful, relaxed, and joyful classrooms in the school."
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 5 Important Matters
I. Fulfillment of commitments
acquirers, and the Company itself that were fulfilled during the reporting period or remained
unfulfilled at the end of the reporting period
Not applicable
period was still within the profit forecast period, the Company's explanation for whether the
assets or projects met the original profit forecast and the reasons
Not applicable
Not applicable
II. Non-operating fund occupation by the controlling shareholder and other
related parties of the listed company
Not applicable
III. Irregular external guarantees
Not applicable
IV. Explanation by the Board of Directors on the matters related to the "non-
standard audit report" for the latest period
Not applicable
V. Explanation by the Board of Directors and independent directors (if any) on
the "non-standard audit report" for the current reporting period issued by the
accounting firm
Not applicable
VI. Explanation of changes in accounting policies, accounting estimates, or
correction of major accounting errors compared to the financial report of the
previous year
In December 2024, the Ministry of Finance issued the Interpretation No. 18 of the Accounting Standards for
Business Enterprises (CK [2024] No. 24), which stipulates that provisions arising from assurance-type warranties
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
that are not separate performance obligations should be recorded in accounts such as "Cost of main business
operations" and "Cost of other operations" based on the determined amount. This interpretation is effective from
the date of issuance, and enterprises are allowed to adopt it early in the year of issuance. In accordance with the
aforementioned relevant standards and notices from the Ministry of Finance, the Company has made
corresponding changes to its accounting policies. For details, please refer to the "Announcement on the Change of
Accounting Policies 2025-012" disclosed by the Company on Cninfo on March 14, 2025.
VII. Explanation of changes in the scope of consolidation compared to the
financial report of the previous year
Not applicable
VIII. Appointment and dismissal of the accounting firm
Currently appointed accounting firm
Name of the domestic accounting firm RSM CHINA
Remuneration of the domestic accounting firm 144 (including 1.14 million yuan for annual report audit
(CNY 10000) fees and 300,000 yuan for internal control audit fees)
Consecutive years of audit service by the domestic
accounting firm
Names of certified public accountants from the
Cai Ruxiao, Ge Hua
domestic accounting firm
Consecutive years of audit service by the certified
public accountants from the domestic accounting 2
firm
Whether the accounting firm was changed during the current period
No
Engagement of an accounting firm for internal control audit, financial advisor, or sponsor
As reviewed and approved at the second extraordinary general meeting of 2025 held on November 25, 2025,
the Company re-engaged RSM CHINA as its internal control audit firm for the year 2025, with an internal control
audit fee of 300,000 yuan.
IX. Delisting risk after the disclosure of the annual report
Not applicable
X. Matters related to bankruptcy and reorganization
Not applicable
XI. Major litigation and arbitration matters
Not applicable
XII. Penalties and rectifications
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
XIII. Integrity of the Company, its controlling shareholder, and actual controller
Not applicable
XIV. Major related-party transactions
Not applicable
As reviewed and approved at the seventh meeting of the 11th Board of Directors, the Company signed an
"Equity Acquisition Intention Agreement" with Hanzhong Hanhang Electromechanical Co., Ltd. on June 4, 2025.
The Company intends to acquire all or part of the controlling stake in Changkong Gear in cash. This acquisition
constitutes a related-party transaction, and based on preliminary estimates, it is not expected to constitute a major
asset restructuring. For details, please refer to the "Announcement on Signing an Equity Acquisition Intention
Agreement and Related-Party Transaction 2025-018," "Progress Announcement on the Proposed Acquisition of
Equity in Shaanxi Changkong Gear Co., Ltd. and Related-Party Transaction 2025-022," and "Progress
Announcement on the Proposed Acquisition of Equity in Shaanxi Changkong Gear Co., Ltd. and Related-Party
Transaction 2026-005," disclosed by the Company on Cninfo on June 5, 2025, July 12, 2025, and February 26,
valuation, and state-owned asset valuation filing related to this acquisition. The final transaction plan has not yet
been determined and is still subject to the necessary decision-making and approval procedures by all parties.
There remains uncertainty as to whether this acquisition can be ultimately completed.
Not applicable
Not applicable
Deposit services
Amount for the Current
Period
Maximum
Opening Total Total Closing
daily Deposit
Related Relationshi balance deposits withdrawals balance
deposit interest
party p (CNY during the during the (CNY
limit (CNY rate range
(CNY (CNY
Controlled
by the
AVIC 0.15%-
same 100,000 49,861 583,593 578,199 55,255
Finance 1.25%
ultimate
party
Loan services
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Amount for the Current
Period
Opening Total Closing
Loan limit Loan Total loans
Related Relationshi balance repayments balance
(CNY interest during the
party p (CNY during the (CNY
(CNY
(CNY
Controlled
by the Not higher
AVIC
same 80,000 than the 1- 0 0 0 0
Finance
ultimate year LPR
party
Credit or other financial services
During the reporting period, the maximum daily balance of related-party deposits and loans with AVIC Finance
did not exceed the limits specified in the financial services agreement, and no credit or other financial services
have been provided to date. Meanwhile, the Company issues a "Risk Assessment Report on Related-Party
Deposits and Loans with AVIC Finance Co., Ltd." semi-annually for the aforementioned matters.
Not applicable
The "Proposal on the Forecast of Routine Related-Party Transactions for 2025" was reviewed and approved at
the fifth meeting of the 11th Board of Directors and the 2024 Annual Shareholders' Meeting. During the reporting
period, the cumulative transaction amount of the Company's various related-party transactions connected with
ordinary business operations was within the annual forecast range. For details, please refer to the "Resolutions of
the Fifth Meeting of the 11th Board of Directors 2025-005," "2005 Announcement on the Forecast of Routine
Related-Party Transactions 2025-009," and "Resolutions of 2024 Annual Shareholders' Meeting 2025-014,"
disclosed by the Company on Cninfo on March 14 and April 10, 2025 respectively.
Website for inquiries regarding interim reports on major related-party transactions
Interim
Interim announcement disclosure
Interim announcement name announcement
website
disclosure date
Resolutions of the Fifth Meeting of the 11th
March 14, 2025 http://www.cninfo.com.cn/
Board of Directors 2025-005
Announcement on the Forecast of Routine
March 14, 2025 http://www.cninfo.com.cn/
Related-Party Transactions for 2025 2025-009
Resolutions of the 2024 Annual Shareholders'
April 10, 2025 http://www.cninfo.com.cn/
Meeting 2025-014
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
XV. Major contracts and their performance
(1) Custodianship
Not applicable
(2) Contracting
Not applicable
(3) Leasing
Not applicable
Unit: CNY 10000
External guarantees of the Company and its subsidiaries (excluding guarantees for subsidiaries)
Disclos
Whethe
Name ure Counte
Actual Actual r it is a
of date of Guaran Collater r- Guaran Whethe
Guaran occurre guarant guarant
guarant guarant tee al (if guarant tee r
tee limit nce ee ee for a
eed ee limit type any) ee (if period fulfilled
date amount related
party announ any)
party
cement
Not applicable
Total actual
Total external
external
guarantee limit
guarantees
approved during 0 0
incurred during
the reporting
the reporting
period (A1)
period (A2)
Total outstanding
Total approved
external
external
guarantee
guarantee limit at
the end of the
end of the
reporting period
reporting period
(A3)
(A4)
Guarantees provided by the Company for its subsidiaries
Disclos
Whethe
Name ure Counte
Actual Actual r it is a
of date of Guaran Collater r- Guaran Whethe
Guaran occurre guarant guarant
guarant guarant tee al (if guarant tee r
tee limit nce ee ee for a
eed ee limit type any) ee (if period fulfilled
date amount related
party announ any)
party
cement
Shenzh March Decem Joint Counte
One
en 14, 15,000 ber 30, 9,000 and r- No No
year
Harmo 2025 2025 several guarant
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
ny liability ee
World guarant provide
Watch ee d by
Center the
Co., guarant
Ltd. eed
party
Total guarantee Total actual
limit for guarantees for
subsidiaries subsidiaries
approved during incurred during
the reporting the reporting
period (B1) period (B2)
Total outstanding
Total approved
guarantee
guarantee limit for
balance for
subsidiaries at the
end of the
end of the
reporting period
reporting period
(B3)
(B4)
Guarantees between subsidiaries
Disclos
Whethe
Name ure Counte
Actual Actual r it is a
of date of Guaran Collater r- Guaran Whethe
Guaran occurre guarant guarant
guarant guarant tee al (if guarant tee r
tee limit nce ee ee for a
eed ee limit type any) ee (if period fulfilled
date amount related
party announ any)
party
cement
Not applicable
Total guarantee Total actual
limit for guarantees for
subsidiaries subsidiaries
approved during incurred during
the reporting the reporting
period (C1) period (C2)
Total outstanding
Total approved
guarantee
guarantee limit for
balance for
subsidiaries at the
end of the
end of the
reporting period
reporting period
(C3)
(C4)
Total guarantees of the Company (i.e., the sum of the above three items)
Total actual
Total guarantee
guarantees
limit approved
incurred during
during the 30,000 9,000
the reporting
reporting period
period
(A1+B1+C1)
(A2+B2+C2)
Total approved Total outstanding
guarantee limit at guarantee
the end of the 30,000 balance at the 9,000
reporting period end of the
(A3+B3+C3) reporting period
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
(A4+B4+C4)
Proportion of total outstanding
guarantee balance (i.e., A4+B4+C4) to 2.70%
the Company's net assets
Including:
Outstanding guarantees for
shareholders, actual controllers, and 0
their related parties (D)
Outstanding debt guarantees directly
or indirectly provided for guaranteed
parties with an asset-liability ratio
exceeding 70% (E)
Amount of total guarantees exceeding
Total of the above three guarantee
amounts (D+E+F)
Description of any guarantee liabilities
incurred or evidence indicating the
possibility of assuming joint and
Not applicable
several repayment liabilities for
unexpired guarantee contracts during
the reporting period (if any)
Description of external guarantees
provided in violation of specified Not applicable
procedures (if any)
Specific description of composite guarantees
Not applicable
(1) Entrusted wealth management
Not applicable
(2) Entrusted loans
Not applicable
Not applicable
XVI. Use of raised funds
Not applicable
XVII. Explanation of other major matters
(I) Revision of the Articles of Association and other regulations
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
As reviewed and approved at the eighth meeting of the 11th Board of Directors and the first extraordinary
general meeting of 2025, the Company has revised certain clauses of the Articles of Association, the Rules of
Procedure for Shareholders' Meetings, and the Rules of Procedure for the Board of Directors. These revisions
were made in accordance with relevant regulations, including the Company Law, the Arrangements for the
Transitional Period for the Implementation of Supporting Systems and Rules for the New Company Law, the
Guidelines for the Articles of Association of Listed Companies, and the Rules Governing the Listing of Stocks on
the Shenzhen Stock Exchange, and were based on the Company's actual situation. For details, please refer to the
relevant announcements disclosed by the Company on Cninfo on August 23, 2025, and September 10, 2025,
respectively.
XVIII. Major matters concerning Company's subsidiaries
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 6 Changes in Shares and Shareholders
I. Changes in shareholding
Unit: share
Before the change Increase/decrease from the change (+, -) After the change
Shar
es
Issu Bo
conv
anc nu
erted
Proporti e of s Proporti
Quantity from Others Subtotal Quantity
on new sh on
capit
shar are
al
es s
reser
ve
I.
Restricte 2,475,720 0.61% 0 0 0 -1,853,380 -1,853,380 622,340 0.15%
d shares
State-
owned
shares
State-
owned
legal
person
shares
Other
domesti
c shares
Incl
uding:
Domesti
c legal
person
shares
Do
mestic
natural 2,475,720 0.61% 0 0 0 -1,853,380 -1,853,380 622,340 0.15%
person
shares
Foreign 0 0.00% 0 0 0 0 0 0 0.00%
shares
Incl
uding: 0 0.00% 0 0 0 0 0 0 0.00%
Foreign
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
legal
person
shares
For
eign
natural 0 0.00% 0 0 0 0 0 0 0.00%
person
shares
II. Non-
restricte 403,288,287 99.39% 0 0 0 1,853,380 1,853,380 99.85%
d shares
Ordinary 364,560,73
shares 3
(CNY)
Domesti
cally-
listed
foreign
shares
Oversea
s-listed 0 0.00% 0 0 0 0 0 0 0.00%
foreign
shares
Others
III. Total 100.00 405,764,00 100.00
shares % 7 %
Reasons for changes in shareholding
an increase of 252,750 restricted shares (with a corresponding decrease in non-restricted shares, while the total
share capital remained unchanged);
Company's Phase II restricted stock incentive plan were vested and became tradable, resulting in a decrease of
decrease of 58,710 restricted shares. The aforementioned factors resulted in a total decrease of 2,106,130
restricted shares (with a corresponding increase in non-restricted shares, while the total share capital remained
unchanged).
For the reasons above, at the end of the reporting period, the Company's total restricted shares decreased by
unchanged.
Approval of changes in shareholding
As approved at the fourth meeting of the 11th Board of Directors, the conditions for the third vesting period of
the Company's Phase II restricted stock incentive plan have been met. The 2,047,420 A-share restricted stocks
subject to vesting were listed and became tradable on February 5, 2025.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Transfer of shares involved in the changes
Not applicable
Impact of the changes in shareholding on financial indicators such as basic and diluted earnings per share, and net
assets per share attributable to ordinary shareholders of the Company for the last year and the latest period
Not applicable
Other information that the Company deems necessary to disclose or that is required by securities regulatory
authorities
Not applicable
Unit: share
Number of Increase in Number of
Vested during
restricted restricted restricted
Sharehol the period Reason for Date of release
shares at the shares during shares at the
der name (shares) (Note restriction from restriction
beginning of the period end of the
the period (Note 1) period
To be unlocked
in accordance
with the
Executive lock-
Pan Bo 172,537 50,100 50,100 172,537 relevant laws
up shares
and regulations
for executive
lock-up shares.
To be unlocked
in accordance
with the
Executive lock-
Li Ming 120,067 50,100 50,100 120,067 relevant laws
up shares
and regulations
for executive
lock-up shares.
To be unlocked
in accordance
with the
Lu Executive lock-
Wanjun up shares
and regulations
for executive
lock-up shares.
To be unlocked
in accordance
with the
Liu Executive lock-
Xiaoming up shares
and regulations
for executive
lock-up shares.
To be unlocked
in accordance
Tang Executive lock- with the
Haiyuan up shares relevant laws
and regulations
for executive
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
lock-up shares.
To be unlocked
in accordance
Lock-up shares with the
Hu Jing 6,750 2,250 0 9,000 for departed relevant laws
supervisors and regulations
for supervisor
lock-up shares.
Bao
Xianyong
Sun Lei 40,080 0 40,080 0 Not applicable Not applicable
Sheng Li 40,080 0 40,080 0 Not applicable Not applicable
Other
sharehol 1,735,390 0 1,735,390 0 Not applicable Not applicable
ders
Total 2,475,720 252,750 2,106,130 622,340 -- --
Note: 1. The increase in restricted shares during this period was due to the adjustment of transferable quotas
for executives and departed supervisors.
vesting period of the Phase II restricted stock incentive plan and the adjustment of transferable quotas for departed
executives.
II. Securities issuance and listing
Not applicable
and the company's asset and liability structure
Same as the description in the section of "Reason for Change in Shareholding".
Not applicable
III. Shareholders and actual controller
Unit: share
Total Total
Total number of
numbe number of
Total number preferred shareholders
r of preferred
of common with restored voting
comm shareholde
shareholders rights at the end of the
at the end of month prior to the
shareh restored
the reporting disclosure of the annual
olders voting
period report (if any) (see
at the rights at
Note 8)
end of the end of
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
the the
month reporting
prior period (if
to the any) (see
disclos Note 8)
ure of
the
annual
report
Shareholding of shareholders with more than 5% of shares or the top 10 shareholders (excluding shares lent
through securities refinancing)
Numbe Pledge, mark,
r of or freeze status
Share Number of Number of
Changes shares
holdin shares held shares held
Shareholder Shareholde during the held
g at the end of without
name r nature reporting with Share Quan
percen the reporting restrictions
period restricti status tity
tage period on sale
ons on
sale
Shentian
State-
Technology Not
owned 40.17
Holdings 162,977,327 0 0 162,977,327 applica 0
legal %
(Shenzhen) ble
person
Co., Ltd.
Domestic Not
#Wu Jilin natural 4.15% 16,851,926 -1,120,515 0 16,851,926 applica 0
person ble
Qianhai Life
Insurance
Not
Co., Ltd. -
Others 3.99% 16,186,370 16,186,370 0 16,186,370 applica 0
Participating
ble
Insurance
Product
Domestic Not
#Zhu Rui natural 0.52% 2,096,600 -52,800 0 2,096,600 applica 0
person ble
China
Merchants
Bank Co.,
Ltd. - Orient Not
Red Vision Others 0.45% 1,838,100 1,838,100 0 1,838,100 applica 0
Value Hybrid ble
Securities
Investment
Fund
Domestic Not
#Wang Xing natural 0.45% 1,820,300 432,500 0 1,820,300 applica 0
person ble
Hong Kong
Securities Overseas Not
Clearing legal 0.39% 1,563,501 1,563,501 0 1,563,501 applica 0
Company person ble
Limited
Bank of
Not
Communicati
Others 0.34% 1,374,700 1,374,700 0 1,374,700 applica 0
ons - Hua An
ble
Innovation
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Securities
Investment
Fund
Domestic Not
Chen Fang natural 0.32% 1,290,500 1,290,500 0 1,290,500 applica 0
person ble
Bank of
China Limited
- Huashang
Not
Selected
Others 0.31% 1,264,300 1,264,300 0 1,264,300 applica 0
Return Hybrid
ble
Securities
Investment
Fund
Strategic investors or
general legal persons
who became top 10
Not applicable
shareholders due to new
share placements (if
any) (see Note 3)
Explanation of related
party relationships or The Company is not aware of any related party relationships or concerted action
concerted action among among the top 10 shareholders mentioned above.
the above shareholders
The shareholder Shentian Technology Holdings authorized a representative to
Explanation of
exercise voting rights on its behalf at the Company's 2024 annual shareholders'
entrusted/entrusting
meeting, the first extraordinary general meeting of 2025, and the second
voting rights or waiver of
extraordinary general meeting of 2025. The number of shares represented was
voting rights involving
the above shareholders
published by the Company on Cninfo.
Special explanation on
the existence of a
repurchase special
Not applicable
account among the top
(see Note 10)
Shareholdings of the top 10 non-restricted shareholders (excluding shares lent through securities refinancing
and shares locked up for senior management)
Number of non-restricted shares held at Type of shares
Shareholder name
the end of the reporting period Type of shares Quantity
Shentian Technology Holdings Ordinary
(Shenzhen) Co., Ltd. shares (CNY)
Ordinary
#Wu Jilin 16,851,926 16,851,926
shares (CNY)
Qianhai Life Insurance Co., Ltd. - Ordinary
Participating Insurance Product shares (CNY)
Ordinary
#Zhu Rui 2,096,600 2,096,600
shares (CNY)
China Merchants Bank Co., Ltd.
Ordinary
- Orient Red Vision Value Hybrid 1,838,100 1,838,100
shares (CNY)
Securities Investment Fund
Ordinary
#Wang Xing 1,820,300 1,820,300
shares (CNY)
Hong Kong Securities Clearing Ordinary
Company Limited shares (CNY)
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Bank of Communications - Hua
Ordinary
An Innovation Securities 1,374,700 1,374,700
shares (CNY)
Investment Fund
Ordinary
Chen Fang 1,290,500 1,290,500
shares (CNY)
Bank of China Limited -
Huashang Selected Return Ordinary
Hybrid Securities Investment shares (CNY)
Fund
Explanation of related
party relationships or
concerted action among
the top 10 non-restricted
The Company is not aware of any related party relationships or concerted action
shareholders, and
among the top 10 shareholders mentioned above.
between the top 10 non-
restricted shareholders
and the top 10
shareholders
Company's shareholder Wu Jilin also holds 12,721,422 shares through a client credit
trading collateral securities account with China CICC Wealth Management Securities
Explanation of the top
Company Limited, holding a total of 16,851,926 shares;
shareholders'
Company's shareholder Zhu Rui also holds 2,094,000 shares through a client credit
participation in margin
trading collateral securities account with First Capital Securities Co., Ltd., holding a
financing and securities
total of 2,096,600 shares;
lending business (if any)
(see Note 4)
Company's shareholder Wang Xing also holds 490,000 shares through a client credit
trading collateral securities account with China Merchants Securities Co., Ltd.,
holding a total of 1,820,300 shares.
Share lending through securities refinancing by shareholders holding over 5% of shares, the top 10 shareholders,
and the top 10 non-restricted shareholders
Not applicable
Changes in the top 10 shareholders and the top 10 non-restricted shareholders compared to the previous period
due to lending/return of shares through securities refinancing
Not applicable
Whether the Company's top 10 ordinary shareholders and top 10 non-restricted ordinary shareholders conducted
agreed-repurchase transactions during the reporting period
No
Nature of controlling shareholder: Centrally-controlled state-owned
Type of controlling shareholder: Legal person
Legal
Name of controlling Date of Main business
representative/Pers Organization code
shareholder establishment operations
on in charge
Investing in and
Shentian
establishing
Technology
Holdings Li Bin June 20, 1997
(Shenzhen) Co.,
projects to be
Ltd.
declared
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
separately);
domestic
commerce, material
supply and
marketing
(excluding
commodities under
exclusive state
control, special
control, or
monopoly);
engaging in import
and export business
(except for projects
prohibited by laws,
administrative
regulations, or State
Council decisions;
restricted projects
require a license
before operation).
Equity interests of
the controlling
shareholder in other
domestic and Shentian Technology Holdings holds an 11.86% equity stake in Tianma Microelectronics
foreign listed Co., Ltd. (Tianma A 000050.SZ) and a 63.97% equity stake in Shennan Circuits
companies it Company Limited (SCC 002916.SZ).
controlled or held
stakes in during the
reporting period
Change of controlling shareholder during the reporting period
Not applicable
Nature of actual controller: Central state-owned assets management authority
Type of actual controller: Legal person
Legal
Name of
representati Date of
actual Organization code Main business operations
ve/Person in establishment
controller
charge
Managing state-owned assets within
the scope authorized by the State
Council; research, design,
development, testing, production,
sales, maintenance, support, and
Aviation
services for military aircraft and
Industry
Corporation Cheng Fubo November 6, 2008
of China,
systems and products; investment
LTD.
and management in industries such
as finance, leasing, general aviation
services, transportation, healthcare,
engineering survey and design,
engineering contracting and
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
construction, and real estate
development; design, research,
development, testing, production,
sales, and maintenance services for
civil aircraft and engines, airborne
equipment and systems, gas
turbines, automobiles and
motorcycles and their engines
(including parts), refrigeration
equipment, electronic products,
environmental protection equipment,
and new energy equipment;
equipment leasing; engineering
survey and design; engineering
contracting and construction; real
estate development and operation;
technology transfer and technical
services related to the above
businesses; import and export
business; technology development
and sales of ships; technology
development of engineering
equipment; technology development
of new energy products. (The
enterprise independently chooses
business items and carries out
business activities in accordance with
the law; for items subject to approval
by law, business activities shall be
carried out according to the approved
content after approval by relevant
departments; it shall not engage in
business activities of projects
prohibited and restricted by the
industrial policies of this city.)
Equity
interests of
the actual
controller in
other
Aviation Industry Corporation of China also holds equity in multiple A-share listed companies,
domestic
such as Shennan Circuits Co., Ltd. (002916.SZ), Tianhong Co., Ltd. (002419.SZ), and Guizhou
and foreign
Guihang Automotive Components Co., Ltd. (600523.SH), as well as in overseas listed companies
listed
including Nexteer Automotive Group Limited (1316.HK).
companies
it controlled
during the
reporting
period
Changes in the actual controller during the reporting period
Not applicable
Block diagram of the ownership and control relationship between the Company and the actual controller
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
The actual controller controls the Company through trusts or other asset management arrangements
Not applicable
largest shareholder and their concerted parties reaches 80% of their total shareholding in
the Company
Not applicable
Not applicable
party, and other committing parties
Not applicable
IV. Specific implementation of share repurchases during the reporting period
Progress in the implementation of share repurchases
Not applicable
Progress in the implementation of reducing holdings of repurchased shares through centralized bidding
transactions
Not applicable
V. Information on preferred shares
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 7 Bond-related Information
Not applicable
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Section 8 Financial Reporting
Auditor’s Report
FIYTA Precision Technology Co., Ltd.
RSMSZ[2026]NO.350Z0003
RSM CHINA CPA LLP
CHINA·BEIJING
If there is any conflict of meaning between the Chinese and English versions, the Chinese version will
prevail
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Contents
Page
Statement of Profit or Loss and Other Comprehensive Income of Parent
Company
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
(English Translation for Reference Only)
Auditor’s Report
RSMSZ[2026]NO.350Z0003
To the Shareholders of FIYTA Precision Technology Co., Ltd.，
Opinion
We have audited the financial statements of FIYTA Precision Technology Co., Ltd. (hereafter
referred to as “the Company”), which comprises the consolidated and the parent company’s
statement of financial position as at 31 December 2025, the consolidated and the parent
company’s statement of profit or loss and other comprehensive income, the consolidated and
the parent company’s statement of cash flows, the consolidated and the parent company’s
statement of changes in equity for the year then ended, and the notes to the financial statements.
In our opinion, the accompanying the Company’s financial statements present fairly, in all
material respects, the consolidated and the company’s financial position as at 31 December
with Accounting Standards for Business Enterprises.
Basis for Opinion
We conducted our audit in accordance with Chinese Standards on Auditing (CSAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Financial Statements section of our report. In accordance with the Code of
Ethics for Professional Accountants and the Code of Independence for Professional Accountants
of the Chinese Institute of Certified Public Accountants, we are independent of the Company,
have complied with the provisions of the independence standards applicable to audits of
financial statements of public interest entities, and have fulfilled our other ethical
responsibilities. We believe that the audit evidence we obtained is sufficient and appropriate to
provide a basis for our opinion.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of the most
significance in our 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) Existence and Net Realizable Value of Inventory
For the details, please refer to Note 3.13 and Note 5.6 of the financial statements.
As stated in Note 5.6, as of 31 December 2025, the carrying amount of the Company's
inventory was RMB 1,830.9665 million, with an inventory write-down provision of RMB
and other agency-branded watches, with year-end inventory primarily consisting of finished
watches and watch components. Given the small size and high unit value of branded watches
and the widely dispersed inventory across central warehouses, regional warehouses, and retail
stores, there is a heightened risk related to inventory existence and impairment.
As of the balance sheet date, the Company's management is required to determine the net
realizable value (NRV) of inventory, and any excess of cost over NRV should be written down
accordingly. The determination of NRV involves significant management estimates regarding
selling prices, costs to completion, selling expenses, and relevant taxes. Due to the materiality
of the inventory balance and the significant accounting estimates and judgments involved in the
impairment provision, we have identified the existence of inventory and the determination of its
NRV as a key audit matter.
The audit procedures we performed in relation to existence and net realizable value of inventory:
(1) Understanding, evaluating, and testing the design and operating effectiveness of internal
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
controls related to procurement and payment, production and warehousing, and inventory write-
down provisions;
(2) Utilizing expert work to conduct IT audits on the information system to evaluate the
authenticity and accuracy of business data related to financial reporting;
(3) Performing inventory counts at selected warehouses and retail stores to verify the existence
and condition of year-end inventory;
(4) Selecting samples of significant purchases during the reporting period and tracing them to
purchase contracts, invoices, purchase requisitions, and warehouse receipts;
(5) Sending confirmation requests to selected suppliers to verify transaction amounts and
balances to confirm procurement details;
(6) Reviewing the Company’s inventory impairment policy and methodology to assess its
reasonableness, obtaining management’s inventory impairment calculation, and evaluating key
assumptions such as estimated selling prices, costs to completion, selling expenses, and related
taxes, along with performing recalculations;
(II) Revenue Recognition
For the details, please refer to Note 3.27 and Note 5.33 of the financial statements.
As stated in Note 5.33 to the financial statements, the main operating revenue of the Company
for the current year was RMB 3490.3203 million, representing a 11.16% decrease compared to
the previous year. The Company's main operating revenue is primarily derived from the sales of
self-owned and agency-brand watches.
Since revenue is one of the Company's key performance indicators, there is an inherent risk that
revenue may be recognized in the incorrect period or manipulated to meet specific targets or
expectations. Therefore, we have identified the revenue recognition of the Company as a key
audit matter.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
The audit procedures we performed in relation to revenue recognition:
(1) Understanding, evaluating, and testing the design and operating effectiveness of internal
controls related to revenue recognition;
(2) Utilizing expert work to conduct IT audits on the information system, evaluating the
authenticity and accuracy of business data related to financial reporting;
(3) Obtaining and reviewing accounting policies related to revenue recognition, and assessing
whether the timing of control transfer, transaction price measurement, and special transaction
accounting treatment comply with the requirements of accounting standards;
(4) Selecting samples to examine supporting documents related to revenue recognition,
including sales contracts, sales invoices, mall reconciliation statements, customer receipt
records, and logistics documents;
(5) Performing audit procedures on accounts receivable by selecting samples for confirmation
of transaction amounts and balances with customers, as well as verifying subsequent collections;
(6) Selecting samples of sales revenue recognized before and after the balance sheet date to
review sales contracts, sales invoices, mall reconciliation statements, customer receipt records,
and logistics documents to evaluate whether revenue is recognized in the appropriate
accounting period.
Other information
Management of the Company is responsible for the other information. The other information
comprises the information included in the Annual Report of the Company for the year of 2025,
but does not include 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
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
materially misstated.
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.
Responsibilities of Management and Those Charged with Governance for the Financial
Statements
Management of the Company is responsible for the preparation and fair presentation of the
financial statements in accordance with Accounting Standards of Business Enterprises, and for
the design, implementation and maintenance of such internal control as 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, management is responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless 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.
Auditor’s Responsibilities for the Audit of the 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 CSAs 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 CSAs, we exercise professional judgment and maintain
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
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 management.
iv) Conclude on the appropriateness of 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 to draw attention in our auditor’s report to the related disclosures in the financial
statements or, if such 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 group
audit. We remain solely responsible for our audit opinion.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
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 significant
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 to 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.
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
(This is seal page for Auditor’s Report of RSMSZ[2026]No.350Z0001 for FIYTA Precision
Technology Co., Ltd..)
RSM China CPA LLP
Cai Ruxiao
China Certified Public Accountant
(Engagement Partner)
China·Beijing
Ge Hua
China Certified Public Accountant
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Consolidated Statement of Financial Position
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Item Note 2025/12/31 2024/12/31 Item Note 2025/12/31 2024/12/31
Current assets: Current liabilities:
Monetary funds 5.1 631,239,039.65 518,954,177.49 Short-term borrowings 5.16 124,087,754.51
Financial assets held-for-trading Financial liabilities held-for-trading
Derivative financial assets Derivative financial liabilities
Notes receivable 5.2 13,617,187.55 29,611,600.60 Notes payable
Accounts receivable 5.3 249,868,540.94 260,152,834.43 Accounts payable 5.17 94,791,440.02 115,532,921.57
Accounts receivable financing Receipts in advance 5.18 11,368,005.63 11,783,796.49
Advances to suppliers 5.4 4,912,759.05 3,858,053.60 Contract liabilities 5.19 16,450,934.50 12,605,722.95
Other receivables 5.5 51,040,153.19 56,982,351.27 Employee benefits payable 5.20 80,059,217.82 92,260,153.14
Including: Interests receivable Taxes payable 5.21 40,198,014.04 49,815,151.35
Dividend receivable Other payables 5.22 75,141,232.27 104,638,483.81
Inventories 5.6 1,727,982,404.66 1,984,486,969.74 Including: Interests payables
Including: Data resources Dividend payables 5.22 2,785,293.14
Contract assets Liabilities classified as held for sale
Assets classified as held for sale Non-current liabilities maturing within one year 5.23 57,044,492.54 63,538,231.06
Non-current assets maturing within one year Other current liabilities 5.24 2,392,725.11 1,529,468.07
Other current assets 5.7 66,510,872.63 98,007,925.22 Total current liabilities 377,446,061.93 575,791,682.95
Total current assets 2,745,170,957.67 2,952,053,912.35 Non-current liabilities:
Non-current assets: Long-term borrowings
Debt investments Bonds payable
Other debt investments Including: Preference share
Long-term receivables Perpetual debt
Long-term equity investments 5.8 46,436,556.86 50,907,036.84 Lease liabilities 5.25 17,892,390.31 35,065,292.04
Other equity instrument investment Long-term payables
Other non-current financial assets Long-term employee benefits payable
Investment properties 5.9 308,270,580.37 301,002,364.41 Estimated liabilities
Fixed assets 5.10 343,353,998.15 377,568,144.41 Deferred income
Construction in progress Deferred tax liabilities 5.14 1,522,995.65 4,990,541.42
Productive biological assets Other non-current liabilities
Oil and gas assets Total non-current liabilities 19,415,385.96 40,055,833.46
Right-of-use assets 5.11 72,791,092.06 98,437,976.41 Total liabilities 396,861,447.89 615,847,516.41
Intangible assets 5.12 31,720,744.04 31,567,927.16 Owners’ equity
Including: Data resources Share capital 5.26 405,764,007.00 405,764,007.00
Development expenditures Other equity instruments
Including: Data resources Including: Preference shares
Goodwill Perpetual debt
Long-term deferred expenses 5.13 89,174,269.50 110,205,323.29 Capital reserves 5.27 935,609,251.94 936,339,503.60
Deferred tax assets 5.14 90,726,063.88 82,155,778.31 Less: Treasury stock 5.28 12,815,556.81
Other non-current assets 5.15 5,757,347.81 3,792,253.84 Other comprehensive income 5.29 23,665,217.37 15,686,794.62
Total non-current assets 988,230,652.67 1,055,636,804.67 Special reserves 5.30 3,961,169.87 4,340,162.76
Surplus reserves 5.31 275,010,401.50 275,010,401.50
Retained earnings 5.32 1,692,530,114.77 1,767,517,887.94
Total owner’s equity attributable to parent company 3,336,540,162.45 3,391,843,200.61
Non-controlling interests
Total owners’ equity 3,336,540,162.45 3,391,843,200.61
Total assets 3,733,401,610.34 4,007,690,717.02 Total liabilities and owners' equity 3,733,401,610.34 4,007,690,717.02
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the year ended 31 December 2025
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Item Note 2025 2024
I. Revenue 5.33 3,508,487,911.40 3,940,530,934.07
Including: operating revenue 3,508,487,911.40 3,940,530,934.07
II. Cost of sales 3,332,189,652.38 3,647,655,677.55
Including: operating cost 5.33 2,262,131,033.76 2,476,197,934.43
Taxes and surcharges 5.34 31,035,870.78 31,477,134.80
Selling and distribution expenses 5.35 781,062,383.74 882,777,806.63
General and administrative expenses 5.36 177,357,796.51 183,277,930.17
Research and development expenses 5.37 69,206,682.36 56,000,000.18
Finance costs 5.38 11,395,885.23 17,924,871.34
Including: Interest expense 5.39 4,883,063.98 10,697,706.12
Interest income 5.39 4,192,623.18 4,925,264.78
Add: Other income 5.39 5,722,898.08 7,492,642.33
Investment income/(losses) 5.40 -3,886,480.19 -431,254.89
Including: Investment income from associates and joint ventures 5.41 -4,324,269.84 -955,570.46
Gains /(losses) from derecognition of financial assets measured at amortised cost
Income /(losses) from net exposure hedging
Gains/(losses) from changes in fair values
Credit impairment losses 5.41 -3,062,496.54 266,485.96
Asset impairment losses 5.42 -53,936,941.10 -19,289,865.31
Gains/(losses) from disposal of assets 5.43 -1,233,966.09 2,367,816.60
III. Profit/(loss) from operations 119,901,273.18 283,281,081.21
Add: Non-operating income 5.44 2,122,706.22 3,623,505.31
Less: Non-operating expenses 5.45 1,920,141.68 788,917.93
IV. Profit/(loss) before tax 120,103,837.72 286,115,668.59
Less: Income tax expenses 5.46 32,786,008.09 65,765,483.60
V. Net profit/(loss) for the year 87,317,829.63 220,350,184.99
(I) Net profit/(loss) by continuity
Net profit/(loss) from continuing operation 87,317,829.63 220,350,184.99
Net profit/(loss) from discontinued operation
(II) Net profit/(loss) by ownership attribution
Attributable to owners of the parent 87,317,829.63 220,350,184.99
Attributable to non-controlling interests
VI. Other comprehensive income for the year, after tax 7,978,422.75 -3,638,541.31
(a) Attributable to owners of the parent 7,978,422.75 -3,638,541.31
(i) Other comprehensive income that will not be reclassified subsequently to profit or loss
(ii) Other comprehensive income to be reclassified subsequently to profit or loss 7,978,422.75 -3,638,541.31
(b) Attributable to non-controlling interests
VII. Total comprehensive income for the year 95,296,252.38 216,711,643.68
Attributable to owners of the parent 95,296,252.38 216,711,643.68
Attributable to non-controlling interests
VIII. Earnings per share:
Basic earnings per share 0.2153 0.5385
Diluted earnings per share 0.2152 0.5378
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Consolidated Statement of Cash Flows
For the year ended 31 December 2025
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Item Note 2025 2024
I. Cash flows from operating activities
Cash received from the sale of goods and the rendering of services 3,872,832,475.43 4,337,357,146.69
Cash received from tax refund 1,194,802.61 2,096,237.99
Other cash received relating to operating activities 5.48 37,255,612.03 49,625,091.94
Subtotal of cash inflows from operating activities 3,911,282,890.07 4,389,078,476.62
Cash payments for goods purchased and services received 2,284,465,593.95 2,664,684,979.78
Cash payments to and on behalf of employees 530,491,374.12 596,768,402.64
Payments for taxes 243,848,359.87 260,501,102.47
Other cash payments relating to operating activities 5.48 310,605,274.60 330,393,031.44
Subtotal of cash outflows from operating activities 3,369,410,602.54 3,852,347,516.33
Net cash flows from operating activities 541,872,287.53 536,730,960.29
II. Cash flows from investing activities
Cash received from disposal and redemption of investments
Cash received from returns on investments 527,807.98 418,515.82
Net cash received from disposals of fixed assets, intangible assets and other long-term assets 188,317.51 4,848,874.32
Net cash received from disposals of subsidiaries and other business units
Other cash received relating to investing activities 5.48 185,690,609.60 201,839,677.57
Subtotal of cash inflows from investing activities 186,406,735.09 207,107,067.71
Cash payments to acquire fixed, intangible and other long-term assets 69,824,736.52 86,818,686.04
Cash payments to acquire investments
Net cash payments to acquire subsidiaries and other business units
Other cash payments relating to investing activities 5.48 156,380,120.10 231,179,882.49
Subtotal of cash outflows from investing activities 226,204,856.62 317,998,568.53
Net cash flows from investing activities -39,798,121.53 -110,891,500.82
III. Cash flows from financing activities
Cash received from capital contributions
Including: Cash receipts from capital contributions form non-controlling interests of subsidiaries
Cash received from borrowings 140,000,000.00 323,957,187.86
Other cash received relating to financing activities
Subtotal of cash inflows from financing activities 140,000,000.00 323,957,187.86
Cash repayments of debts 260,000,000.00 450,000,000.00
Cash payments for dividends, distribution of profit and interest expenses 166,409,775.66 168,545,613.69
Including: Dividends, distribution of profit paid to non-controlling shareholders of subsidiaries
Other cash payments relating to financing activities 5.48 103,960,778.17 116,757,093.91
Subtotal of cash outflows from financing activities 530,370,553.83 735,302,707.60
Net cash flows from financing activities -390,370,553.83 -411,345,519.74
IV. Effect of foreign exchange rate changes on cash and cash equivalents 581,249.99 -168,915.95
V. Net increase / (decrease) in cash and cash equivalents 112,284,862.16 14,325,023.78
Plus: Cash and cash equivalents at the beginning of the period 518,954,177.49 504,629,153.71
VI. Cash and cash equivalents at the end of the period 631,239,039.65 518,954,177.49
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Consolidated Statement of Changes in Owners' Equity
For the year ended 31 December 2025
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Owners’ equity attributable to the parent company
Other equity instruments
Non-
Item Pref controlli Total owners’
Other
eren Perpetua Capital Less: Treasury Special Surplus Retained ng equity
Share capital Other comprehensiv Subtotal
ce l capital reserves stock reserves reserves earnings interests
s e income
shar securities
es
I. Balance at 31 December 2024 405,764,007.00 12,815,556.81 15,686,794.62 4,340,162.76 275,010,401.5 3,391,843,200.61 3,391,843,200.61
Add：Changes in accounting policies
Correction of prior period errors
Others
II. Balance at 1 January 2025 405,764,007.00 12,815,556.81 15,686,794.62 4,340,162.76 275,010,401.5 3,391,843,200.61 3,391,843,200.61
III. Changes in equity during the
-730,251.66 -12,815,556.81 7,978,422.75 -378,992.89 -74,987,773.17 -55,303,038.16 -55,303,038.16
reporting period
(i) Total comprehensive income 7,978,422.75 87,317,829.63 95,296,252.38 95,296,252.38
(ii) Capital contributions or withdrawals by
-730,251.66 -12,815,556.81 12,085,305.15 12,085,305.15
owners
shareholders
other equity instruments
-730,251.66 -12,815,556.81 12,085,305.15 12,085,305.15
owners’ equity
(iii) Profit distribution -162,305,602.80 -162,305,602.80 -162,305,602.80
-162,305,602.80 -162,305,602.80 -162,305,602.80
shareholders)
(iv) Transfer within owners' equity
capital
capital
transferred to retained earnings
to retained earnings
(v) Special reserves -378,992.89 -378,992.89 -378,992.89
(vi) Others
IV. Balance at 31 December 2025 405,764,007.00 23,665,217.37 3,961,169.87 275,010,401.5 3,336,540,162.45 3,336,540,162.45
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Consolidated Statement of Changes in Owners' Equity
For the year ended 31 December 2025
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Owners’ equity attributable to the parent company
Non-
Item Other equity instruments
Other controlli
Prefere Perpetual Less: Treasury Special Total owners’ equity
Share capital Capital reserves comprehensive Surplus reserves Retained earnings Subtotal ng
nce capital Others stock reserves interests
income
shares securities
I. Balance at 31
December 2023 415,219,970.00
Add：Changes in
accounting policies
Correction of prior
period errors
Others
II. Balance at 1 January
III. Changes in equity
during the reporting -9,455,963.00 -53,819,529.57 -65,829,975.42 -3,638,541.31 1,117,004.70 58,004,502.18 58,037,448.42 58,037,448.42
period
(i) Total comprehensive
-3,638,541.31 220,350,184.99 216,711,643.68 216,711,643.68
income
(ii) Capital contributions
-9,455,963.00 -53,819,529.57 -65,829,975.42 2,554,482.85 2,554,482.85
or withdrawals by owners
contributed by -9,355,763.00 -54,984,906.42 -64,340,669.42
shareholders
holders of
other equity instruments
recognised in owners’ -100,200.00 1,165,376.85 -1,489,306.00 2,554,482.85 2,554,482.85
equity
(iii) Profit distribution -162,345,682.81 -162,345,682.81 -162,345,682.81
reserves
-162,345,682.81 -162,345,682.81 -162,345,682.81
owners (or shareholders)
(iv) Transfer within
owners' equity
converted to share capital
converted to share capital
surplus reserves
defined benefit plan
transferred to retained
earnings
income transferred to
retained earnings
(v) Special reserves 1,117,004.70 1,117,004.70 1,117,004.70
reporting period
-404,108.10 -404,108.10 -404,108.10
reporting period
(vi) Others
IV. Balance at 31
December 2024 405,764,007.00
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Statement of Financial Position of Parent Company
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Item Note 2025/12/31 2024 年 12 月 31 日 Item Note 2025/12/31 2024/12/31
Current assets: Current liabilities:
Monetary funds 457,084,217.33 390,160,466.41 Short-term borrowings 120,130,566.65
Financial assets held-for-trading Financial liabilities held-for-trading
Derivative financial assets Derivative financial liabilities
Notes receivable Notes payable
Accounts receivable 16.1 9,983,210.72 4,631,990.38 Accounts payable 111,122,030.74 1,928,876.85
Accounts receivable financing Receipts in advance 11,369,857.62 11,783,796.49
Advances to suppliers Contract liabilities
Other receivables 16.2 545,751,274.33 659,565,868.48 Employee benefits payable 17,665,486.91 23,190,240.79
Including: Interests receivable Taxes payable 790,242.76 779,783.47
Dividend receivable Other payables 297,160,359.41 252,129,600.19
Inventories 35,526,848.62 45,565.43 Including: Interests payables
Including: Data resources Dividend payables 2,785,293.14
Contract assets Liabilities classified as held for sale
Non-current liabilities maturing within one
Assets classified as held for sale
year
Non-current assets maturing within one year Other current liabilities
Other current assets 25,674,166.66 16,189,136.04 Total current liabilities 438,107,977.44 409,942,864.44
Total current assets 1,074,019,717.66 1,070,593,026.74 Non-current liabilities:
Non-current assets: Long-term borrowings
Debt investments Bonds payable
Other debt investments Including: Preference share
Long-term receivables Perpetual debt
Long-term equity investments 16.3 1,638,980,442.77 1,643,450,922.75 Lease liabilities
Other equity instrument investment Long-term payables
Other non-current financial assets Long-term employee benefits payable
Investment properties 218,384,208.08 237,185,496.11 Estimated liabilities
Fixed assets 242,887,333.30 241,791,004.56 Deferred income
Construction in progress Deferred tax liabilities
Productive biological assets Other non-current liabilities
Oil and gas assets Total non-current liabilities
Right-of-use assets Total liabilities 438,107,977.44 409,942,864.44
Intangible assets 24,260,033.91 24,189,360.11 Owners’ equity
Including: Data resources Share capital 405,764,007.00 405,764,007.00
Development expenditures Other equity instruments
Including: Data resources Including: Preference shares
Goodwill Perpetual debt
Long-term deferred expenses 12,299,699.77 3,692,497.29 Capital reserves 938,999,713.64 939,217,999.41
Deferred tax assets 20,283,973.50 931,572.58 Less: Treasury stock 12,815,556.81
Other non-current assets 1,989,858.55 1,358,052.54 Other comprehensive income
Total non-current assets 2,159,085,549.88 2,152,598,905.94 Special reserves
Surplus reserves 275,010,401.50 275,010,401.50
Retained earnings 1,175,223,167.96 1,206,072,217.14
Total owners’ equity 2,794,997,290.10 2,813,249,068.24
Total non-current assets 3,233,105,267.54 3,223,191,932.68 Total liabilities and owners' equity 3,233,105,267.54 3,223,191,932.68
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Statement of Profit or Loss and Other Comprehensive Income of Parent Company
For the year ended 31 December 2025
Unit：Yuan Currency:
Prepared by: FIYTA Precision Technology Co., Ltd. RMB
Item Note 2025 2024
I. Revenue 16.4 158,754,204.71 184,540,282.60
Less: Costs of sales 16.4 70,244,357.69 56,887,861.74
Taxes and surcharges 7,627,694.72 7,760,550.74
Selling and distribution expenses 51,630,556.48 36,615,636.74
Administrative expenses 52,565,506.43 50,131,039.57
Research and development expenses 13,555,662.81 13,813,526.33
Finance costs -3,175,932.67 -2,116,792.12
Including: Interest expense -53,879.69 1,342,394.82
Interest income 2,987,536.92 3,871,354.75
Add: Other income 918,743.58 1,163,695.74
Investment income/(losses) 16.5 190,147,313.45 287,322,662.30
Including: Investment income from associates and joint ventures 16.5 -4,470,479.98 -955,570.46
Gains /(losses) from derecognition of financial assets measured at amortised cost
Income /(losses) from net exposure hedging
Gains/(losses) from changes in fair values
Credit impairment losses -258,425.46 -1,785,286.03
Asset impairment losses -45,075,410.47
Gains/(losses) from disposal of assets -3,396.34 2,917,069.98
II. Profit/(loss) from operations 112,035,184.01 311,066,601.59
Add: Non-operating income 219,045.86 1,273.45
Less: Non-operating expenses 150,077.17 360,776.94
III. Profit/(loss) before tax 112,104,152.70 310,707,098.10
Less: Income tax expenses -19,352,400.92 5,918,681.51
IV. Net profit/(loss) for the year 131,456,553.62 304,788,416.59
Net profit/(loss) from continuing operation 131,456,553.62 304,788,416.59
Net profit/(loss) from discontinued operation
V. Other comprehensive income for the year, after tax
(i) Other comprehensive income that will not be reclassified subsequently to profit or loss
(ii) Other comprehensive income to be reclassified subsequently to profit or loss
VI. Total comprehensive income for the year 131,456,553.62 304,788,416.59
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Statement of Cash Flows of Parent Company
For the year ended 31 December 2025
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Item Note 2025 2024
I. Cash flows from operating activities
Cash received from the sale of goods and the rendering of services 165,237,815.79 195,929,990.98
Cash received from tax refund 47,921.04
Other cash received relating to operating activities 3,397,771,175.74 3,946,025,896.49
Subtotal of cash inflows from operating activities 3,563,008,991.53 4,142,003,808.51
Cash payments for goods purchased and services received 14,155,992.80 20,605,249.00
Cash payments to and on behalf of employees 69,750,918.29 74,801,849.07
Payments for taxes 14,902,865.59 24,754,181.25
Other cash payments relating to operating activities 3,291,243,842.91 3,917,630,232.90
Subtotal of cash outflows from operating activities 3,390,053,619.59 4,037,791,512.22
Net cash flows from operating activities 172,955,371.94 104,212,296.29
II. Cash flows from investing activities
Cash received from disposal and redemption of investments
Cash received from returns on investments 194,617,793.43 288,278,232.76
Net cash received from disposals of fixed assets, intangible assets and other
long-term assets
Net cash received from disposals of subsidiaries and other business units
Other cash received relating to investing activities
Subtotal of cash inflows from investing activities 194,622,881.43 293,020,378.23
Cash payments to acquire fixed, intangible and other long-term assets 14,201,019.25 5,993,530.21
Cash payments to acquire investments 10,000,000.00
Net cash payments to acquire subsidiaries and other business units
Other cash payments relating to investing activities
Subtotal of cash outflows from investing activities 14,201,019.25 15,993,530.21
Net cash flows from investing activities 180,421,862.18 277,026,848.02
III. Cash flows from financing activities
Cash received from capital contributions
Cash received from borrowings 140,000,000.00 320,000,000.00
Other cash received relating to financing activities
Subtotal of cash inflows from financing activities 140,000,000.00 320,000,000.00
Cash repayments of debts 260,000,000.00 450,000,000.00
Cash payments for dividends, distribution of profit and interest expenses 166,409,775.66 168,545,613.69
Other cash payments relating to financing activities 794,690.45
Subtotal of cash outflows from financing activities 426,409,775.66 619,340,304.14
Net cash flows from financing activities -286,409,775.66 -299,340,304.14
IV. Effect of foreign exchange rate changes on cash and cash equivalents -43,707.54 31,370.89
V. Net increase / (decrease) in cash and cash equivalents 66,923,750.92 81,930,211.06
Plus: Cash and cash equivalents at the beginning of the period 390,160,466.41 308,230,255.35
VI. Cash and cash equivalents at the end of the period 457,084,217.33 390,160,466.41
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Statement of Changes in Owners' Equity of Parent Company
For the year ended 31 December 2025
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Other equity instruments
Pr
Perp
efe
etual Other
Item re Capital Less: Special Retained Total owners’
Share capital capit comprehensive Surplus reserves
nc reserves Treasury stock reserves earnings equity
al Others income
e
secu
sh
ritie
are
s
s
I. Balance at 31 December 2024 405,764,007.00 939,217,999.41 12,815,556.81 275,010,401.50 2,813,249,068.24
Add：Changes in accounting policies
Correction of prior period errors
Others
II. Balance at 1 January 2025 405,764,007.00 939,217,999.41 12,815,556.81 275,010,401.50 2,813,249,068.24
III. Changes in equity during the
-218,285.77 -12,815,556.81 -30,849,049.18 -18,251,778.14
reporting period
(i) Total comprehensive income 131,456,553.62 131,456,553.62
(ii) Capital contributions or withdrawals by
-218,285.77 -12,815,556.81 12,597,271.04
owners
shareholders
other equity instruments
-218,285.77 -12,815,556.81 12,597,271.04
owners’ equity
(iii) Profit distribution -162,305,602.80 -162,305,602.80
-162,305,602.80 -162,305,602.80
shareholders)
(iv) Transfer within owners' equity
capital
capital
transferred to retained earnings
to retained earnings
(v) Special reserves
(vi) Others
IV. Balance at 31 December 2025 405,764,007.00 938,999,713.64 275,010,401.50 1,175,223,167.96 2,794,997,290.10
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
Full Text of 2025 Annual Report of FIYTA Precision Technology Co., Ltd.
Statement of Changes in Owners' Equity of Parent Company
For the year ended 31 December 2025
Prepared by: FIYTA Precision Technology Co., Ltd. Unit：Yuan Currency: RMB
Other equity instruments Speci
Item Other
Share Perpetual Less: Treasury al Surplus Retained Total owners’
Preference Capital reserves comprehens
capital capital Others stock reser reserves earnings equity
shares ive income
securities ves
I. Balance at 31 December 2023 415,219,970.00 993,037,528.98 78,645,532.23 275,010,401.50 1,063,629,483.35 2,668,251,851.60
Add：Changes in accounting policies
Correction of prior period errors
Others
II. Balance at 1 January 2024 415,219,970.00 993,037,528.98 78,645,532.23 275,010,401.50 1,063,629,483.35 2,668,251,851.60
III. Changes in equity during the -9,455,963.00 -53,819,529.57 -65,829,975.42 142,442,733.79 144,997,216.64
reporting period
(i) Total comprehensive income 304,788,416.59 304,788,416.59
(ii) Capital contributions or withdrawals -9,455,963.00 -53,819,529.57 -65,829,975.42 2,554,482.85
by owners
shareholders
other equity instruments
owners’ equity
(iii) Profit distribution -162,345,682.80 -162,345,682.80
shareholders)
(iv) Transfer within owners' equity
capital
capital
transferred to retained earnings
transferred to retained earnings
(v) Special reserves
period
(vi) Others
IV. Balance at 31 December 2024 405,764,007.00 939,217,999.41 12,815,556.81 275,010,401.50 1,206,072,217.14 2,813,249,068.24
Legal Representative: Zhou Jinqun Chief Financial Officer：Song Yaoming Finance Manager： Jiang Haiming
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
FIYTA Precision Technology Co., Ltd.
Notes to the Financial Statements
For the year ended 31 December 2025
（All amounts are expressed in Renminbi Yuan(“RMB”)unless otherwise stated）
FIYTA Precision Technology Co., Ltd. (hereinafter referred to as “the Company”) was established,
under the approval of Shen Fu Ban Fu (1992) 1259 issued by the General Office of Shenzhen
Municipal Government, through the restructuring of former Shenzhen FIYTA Time Industrial
Company by the promoter of China National Aero-Technology Import and Export Shenzhen Industry
& Trade Center (name changed to “China National Aero-Technology Shenzhen Co., Ltd” lately) on
The Company holds business license with the Unified Social Credit Code of 91440300192189783K.
As at 31 December 2025, the outstanding shares issued by the Company was 405.764007 million
shares and the registered capital was 405.764007 million after a series of share dividends, rights
offering, capitalization of reserves, and issuing of new shares. The Company’s registered address is
FIYTA Hi-Tech Building, Gao Xin Nan Yi Dao, Nanshan District, Shenzhen, Guangdong Province,
where the Company’s headquarters locates. The parent company of the Company is CATIC
Shenzhen Holdings Limited (CATIC Shenzhen) and the ultimate controlling party of the Company is
Aviation Industry Corporation of China, Ltd. (AVIC) .
The business nature and main operating activities of the Company and its subsidiaries mainly include:
Watch and Clock Sales; Watch and Timing Instrument Manufacturing; Watch and Timing Instrument
Sales; Jewelry Wholesale; Jewelry Retail; Wearable Intelligent Devices Manufacturing; Wearable
Intelligent Devices Sales; Non-residential Real Estate Leasing; Professional Design Services; Sales
of Household Electrical Appliances; Sales of Satellite Mobile Communication Terminals. (Except for
projects that require approval by law, business activities may be conducted independently based on
the business license in accordance with the law.)
The Company included a total of 12 subsidiaries in the consolidation scope for the current period.
For details, refer to Note 7, Interests in Other Entities. There were no changes in the entities included
in the consolidated financial statements compared to the previous period.
The financial statements were approved and authorized for issue, upon the resolution of the
Company’s Board of Directors meeting on 12 March 2026.
Based on going concern, according to actually occurred transactions and events, the Company
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
prepares its financial statements in accordance with the Accounting Standards for Business
Enterprises – Basic standards and concrete accounting standards, Accounting Standards for Business
Enterprises – Application Guidelines, Accounting Standards for Business Enterprises –
Interpretations and other relevant provisions (collectively known as “Accounting Standards for
Business Enterprises, issued by Ministry of Finance of PRC”). In addition, the Company discloses
the relevant financial information in accordance with "Rules No.15 for the Information Disclosure
and Reporting of Companies Offering Securities to the Public - General Requirements for Financial
Reporting (2023 Revision)" issued by CSRC.
The Company has assessed its ability to continually operate for the next twelve months from the end
of the reporting period, and no any matters that may result in doubt on its ability as a going concern
were noted. Therefore, it is reasonable for the Company to prepare financial statements on the going
concern basis.
The following significant accounting policies and accounting estimates of the Company are
formulated in accordance with the Accounting Standards for Business Enterprises. Businesses not
mentioned are complied with relevant accounting policies of the Accounting Standards for Business
Enterprises.
The Company prepares its financial statements in accordance with the requirements of the
Accounting Standards for Business Enterprises, truly and completely reflecting the Company’s
financial position as at 31 December 2025, and its operating results, changes in shareholders' equity,
cash flows and other related information for the year then ended.
The accounting year of the Company is from 1 January to 31 December in calendar year.
The normal operating cycle of the Company is twelve months.
The Company and its domestic subsidiaries use RMB as the functional currency. The Company’s
overseas subsidiary, FIYTA (Hong Kong) Limited (“FIYTA Hong Kong”) , has determined HKD
as its functional currency based on the primary economic environment in which it operates. Montres
Chouriet SA, a subsidiary of FIYTA Hong Kong, has determined CHF as its functional currency
based on its operating environment. When preparing financial statements, their amounts are
translated into RMB. The Company prepares its financial statements in RMB.
Item Factor and basis of materiality
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Item Factor and basis of materiality
Accounts receivable with significant reversal or
The amount of an individual item for year-end balance
recovery of provision for bad debts recognized during
is more than RMB 1,000,000
the current period
The amount of an individual item for year-end balance
Significant other payables aged more than one year
is more than RMB 1,000,000
(a) Business combinations under common control
The assets and liabilities that the Company obtains in a business combination under common control
shall be measured at their carrying amount of the acquired entity at the combination date. If the
accounting policy and accounting period adopted by the acquired entity is different from that adopted
by the acquiring entity, the acquiring entity shall, according to accounting policy and accounting
period it adopts, adjust the relevant items in the financial statements of the acquired party based on
the principal of materiality. As for the difference between the carrying amount of the net assets
obtained by the acquiring entity and the carrying amount of the consideration paid by it, the capital
reserve (capital premium or share premium) shall be adjusted. If the capital reserve (capital premium
or share premium) is not sufficient to absorb the difference, any excess shall be adjusted against
retained earnings.
(b) Business combinations not under common control
The assets and liabilities that the Company obtains in a business combination not under common
control shall be measured at their fair value at the acquisition date. If the accounting policy and
accounting period adopted by the acquired entity is different from that adopted by the acquiring
entity, the acquiring entity shall, according to accounting policy and accounting period it adopts,
adjust the relevant items in the financial statements of the acquired entity based on the principal of
materiality. The acquiring entity shall recognise the positive balance between the combination costs
and the fair value of the identifiable net assets it obtains from the acquired entity as goodwill. The
acquiring entity shall, pursuant to the following provisions, treat the negative balance between the
combination costs and the fair value of the identifiable net assets it obtains from the acquired entity:
(i) It shall review the measurement of the fair values of the identifiable assets, liabilities and
contingent liabilities it obtains from the acquired entity as well as the combination costs;
(ii) If, after the review, the combination costs are still less than the fair value of the identifiable net
assets it obtains from the acquired entity, the balance shall be recognised in profit or loss of the
reporting period.
(c) Treatment of business combination related costs
The intermediary costs such as audit, legal services and valuation consulting and other related
management costs that are directly attributable to the business combination shall be charged in profit
or loss in the period in which they are incurred. The costs to issue equity or debt securities for the
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
consideration of business combination shall be recorded as a part of the value of the respect equity or
debt securities upon initial recognition.
(a) Judgment of control and consolidation decision
Control exists when the Company has power over the investee, exposure, or rights, to variable
returns from its involvement with the investee and the ability to use its power over the investee to
affect the amount of the returns. The definition of control contains there elements: - power over the
investee; exposure, or rights to variable returns from the Company’s involvement with the investee;
and the ability to use its power over the investee to affect the amount of the investor’s returns. The
Company controls an investee if and only if the Company has all the above three elements.
The scope of consolidated financial statements shall be determined on the basis of control. It not only
includes subsidiaries determined based on voting rights (or similar) or together with other
arrangement, but also structured entities under one or more contractual arrangements.
Subsidiaries are the entities that controlled by the Company (including enterprise, a divisible part of
the investee, and structured entity controlled by the enterprise). A structured entity (sometimes called
a Special Purpose Entity) is an entity that has been designed so that voting or similar rights are not
the dominant factor in deciding who controls the entity.
(b) Method of preparing the consolidated financial statements
The consolidated financial statements shall be prepared by the Company based on the financial
statements of the Company and its subsidiaries, and using other related information.
When preparing consolidated financial statements, the Company shall consider the entire group as an
accounting entity, adopt uniform accounting policies and apply the requirements of Accounting
Standard for Business Enterprises related to recognition, measurement and presentation. The
consolidated financial statements shall reflect the overall financial position, operating results and
cash flows of the group.
(i) Like items of assets, liabilities, equity, income, expenses and cash flows of the parent are
combined with those of the subsidiaries.
(ii) The carrying amount of the parent’s investment in each subsidiary is eliminated (off-set) against
the parent’s portion of equity of each subsidiary.
(iii) Eliminate the impact of intragroup transactions between the Company and the subsidiaries or
between subsidiaries, and when intragroup transactions indicate an impairment of related assets, the
losses shall be recognised in full.
(iv) Make adjustments to special transactions from the perspective of the group.
(c) Special consideration in consolidation elimination
(i) Long-term equity investment held by the subsidiaries to the Company shall be recognised as
treasury stock of the Company, which is offset with the owner’s equity, represented as “treasury
stock” under “owner’s equity” in the consolidated statement of financial position.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Long-term equity investment held by subsidiaries between each other is accounted for taking long-
term equity investment held by the Company to its subsidiaries as reference. That is, the long-term
equity investment is eliminated (off-set) against the portion of the corresponding subsidiary’s equity.
(ii) Due to not belonging to paid-in capital (or share capital) and capital reserve, and being different
from retained earnings and undistributed profit, “Specific reserves” and “General risk provision”
shall be recovered based on the proportion attributable to owners of the parent company after long-
term equity investment to the subsidiaries is eliminated with the subsidiaries’ equity.
(iii) If temporary timing difference between the book value of the assets and liabilities in the
consolidated statement of financial position and their tax basis is generated as a result of elimination
of unrealized inter-company transaction profit or loss, deferred tax assets of deferred tax liabilities
shall be recognised, and income tax expense in the consolidated statement of profit or loss shall be
adjusted simultaneously, excluding deferred taxes related to transactions or events directly
recognised in owner’s equity or business combination.
(iv) Unrealised inter-company transactions profit or loss generated from the Company selling assets
to its subsidiaries shall be eliminated against “net profit attributed to the owners of the parent
company” in full. Unrealized inter-company transactions profit or loss generated from the
subsidiaries selling assets to the Company shall be eliminated between “net profit attributed to the
owners of the parent company” and “non-controlling interests” pursuant to the proportion of the
Company in the related subsidiaries. Unrealized inter-company transactions profit or loss generated
from the assets sales between the subsidiaries shall be eliminated between “net profit attributed to the
owners of the parent company” and “non-controlling interests” pursuant to the proportion of the
Company in the selling subsidiaries.
(v) If loss attributed to the minority shareholders of a subsidiary in current period is more than the
proportion of non-controlling interest in this subsidiary at the beginning of the period, non-
controlling interest is still to be written down.
A joint arrangement is an arrangement of which two or more parties have joint control. Joint
arrangement of the Company is classified as either a joint operation or a joint venture.
(a) Joint operation
A joint operation is a joint arrangement whereby the parties that have joint control of the
arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement.
The Company shall recognise the following items in relation to shared interest in a joint operation,
and account for them in accordance with relevant accounting standards of the Accounting Standards
for Business Enterprises:
(i) its assets, including its share of any assets held jointly;
(ii) its liabilities, including its share of any liabilities incurred jointly;
(iii) its revenue from the sale of its share of the output arising from the joint operation;
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(iv) its share of the revenue from the sale of the output by the joint operation; and
(v) its expenses, including its share of any expenses incurred jointly.
(b) Joint venture
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement
have rights to the net assets of the arrangement.
The Company accounts for its investment in the joint venture by applying the equity method of long-
term equity investment.
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cash
equivalents include short-term (generally within three months of maturity at acquisition), highly
liquid investments that are readily convertible into known amounts of cash and which are subject to
an insignificant risk of changes in value.
Statements
(a) Determination of the exchange rate for foreign currency transactions
At the time of initial recognition of a foreign currency transaction, the amount in the foreign
currency shall be translated into the amount in the functional currency at the spot exchange rate of
the transaction date, or at an exchange rate which is determined through a systematic and reasonable
method and is approximate to the spot exchange rate of the transaction date (hereinafter referred to as
the approximate exchange rate).
(b) Translation of monetary items denominated in foreign currency on the balance sheet date
The foreign currency monetary items shall be translated at the spot exchange rate on the balance
sheet date. The balance of exchange arising from the difference between the spot exchange rate on
the balance sheet date and the spot exchange rate at the time of initial recognition or prior to the
balance sheet date shall be recorded into the profits and losses at the current period. The foreign
currency non-monetary items measured at the historical cost shall still be translated at the spot
exchange rate on the transaction date; for the foreign currency non-monetary items restated to a fair
value measurement, shall be translated into the at the spot exchange rate at the date when the fair
value was determined, for the Fair Value Through Profit or Loss,the difference between the restated
functional currency amount and the original functional currency amount shall be recorded into the
profits and losses at the current period.
(c) Translation of foreign currency financial statements
Before translating the financial statements of foreign operations, the accounting period and
accounting policy shall be adjusted so as to conform to the Company. The adjusted foreign operation
financial statements denominated in foreign currency (other than functional currency) shall be
translated in accordance with the following method:
(i) The asset and liability items in the statement of financial position shall be translated at the spot
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
exchange rates at the date of that statement of financial position. The owners’ equity items except
undistributed profit shall be translated at the spot exchange rates when they are incurred.
(ii) The income and expense items in the statement of profit and other comprehensive income shall
be translated at the spot exchange rates or approximate exchange rate at the date of transaction.
(iii) Foreign currency cash flows and cash flows of foreign subsidiaries shall be translated at the spot
exchange rate or approximate exchange rate when the cash flows are incurred. The effect of
exchange rate changes on cash is presented separately in the statement of cash flows as an
adjustment item.
(iv) The differences arising from the translation of foreign currency financial statements shall be
presented separately as “other comprehensive income” under the owners’ equity items of the
consolidated statement of financial position.
When disposing a foreign operation involving loss of control, the cumulative amount of the exchange
differences relating to that foreign operation recognised under other comprehensive income in the
statement of financial position, shall be reclassified into current profit or loss according to the
proportion disposed.
Financial instrument is any contract which gives rise to both a financial asset of one entity and a
financial liability or equity instrument of another entity.
(a) Recognition and derecognition of financial instrument
A financial asset or a financial liability should be recognised in the statement of financial position
when, and only when, an entity becomes party to the contractual provisions of the instrument.
A financial asset can only be derecognised when meets one of the following conditions:
(i) The rights to the contractual cash flows from a financial asset expire
(ii) The financial asset has been transferred and meets one of the following derecognition conditions:
Financial liabilities (or part thereof) are derecognised only when the liability is extinguished—i.e.,
when the obligation specified in the contract is discharged or cancelled or expires. An exchange of
the Company (borrower) and lender of debt instruments that carry significantly different terms or a
substantial modification of the terms of an existing liability are both accounted for as an
extinguishment of the original financial liability and the recognition of a new financial liability.
Purchase or sale of financial assets in a regular-way shall be recognised and derecognised using trade
date accounting. A regular-way purchase or sale of financial assets is a transaction under a contract
whose terms require delivery of the asset within the time frame established generally by regulations
or convention in the market place concerned. Trade date is the date at which the entity commits itself
to purchase or sell an asset.
(b) Classification and measurement of financial assets
At initial recognition, the Company classified its financial asset based on both the business model for
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
managing the financial asset and the contractual cash flow characteristics of the financial asset:
financial asset at amortised cost, financial asset at fair value through profit or loss (FVTPL) and
financial asset at fair value through other comprehensive income (FVTOCI). Reclassification of
financial assets is permitted if, and only if, the objective of the entity’s business model for managing
those financial assets changes. In this circumstance, all affected financial assets shall be reclassified
on the first day of the first reporting period after the changes in business model; otherwise the
financial assets cannot be reclassified after initial recognition.
Financial assets shall be measured at initial recognition at fair value. For financial assets measured at
FVTPL, transaction costs are recognised in current profit or loss. For financial assets not measured at
FVTPL, transaction costs should be included in the initial measurement. Notes receivable or
accounts receivable that arise from sales of goods or rendering of services are initially measured at
the transaction price defined in the accounting standard of revenue where the transaction does not
include a significant financing component.
Subsequent measurement of financial assets will be based on their categories:
(i)Financial asset at amortised cost
The financial asset at amortised cost category of classification applies when both the following
conditions are met: the financial asset is held within the business model whose objective is to hold
financial assets in order to collect contractual cash flows, and the contractual term of the financial
asset gives rise on specified dates to cash flows that are solely payment of principal and interest on
the principal amount outstanding. These financial assets are subsequently measured at amortised cost
by adopting the effective interest rate method. Any gain or loss arising from derecognition according
to the amortization under effective interest rate method or impairment are recognised in current profit
or loss.
(ii)Financial asset at fair value through other comprehensive income (FVTOCI)
The financial asset at FVTOCI category of classification applies when both the following conditions
are met: the financial asset is held within the business model whose objective is achieved by both
collecting contractual cash flows and selling financial assets, and the contractual term of the financial
asset gives rise on specified dates to cash flows that are solely payment of principle and interest on
the principal amount outstanding. All changes in fair value are recognised in other comprehensive
income except for gain or loss arising from impairment or exchange differences, which should be
recognised in current profit or loss. At derecognition, cumulative gain or loss previously recognised
under OCI is reclassified to current profit or loss. However, interest income calculated based on the
effective interest rate is included in current profit or loss.
The Company make an irrevocable decision to designate part of non-trading equity instrument
investments as measured through FVTOCI. All changes in fair value are recognised in other
comprehensive income except for dividend income recognised in current profit or loss. At
derecognition, cumulative gain or loss are reclassified to retained earnings.
(iii)Financial asset at fair value through profit or loss (FVTPL)
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Financial asset except for above mentioned financial asset at amortised cost or financial asset at fair
value through other comprehensive income (FVTOCI), should be classified as financial asset at fair
value through profit or loss (FVTPL). These financial assets should be subsequently measured at fair
value. All the changes in fair value are included in current profit or loss.
(c) Classification and measurement of financial liabilities
The Company classified the financial liabilities as financial liabilities at fair value through profit or
loss (FVTPL), loan commitments at a below-market interest rate and financial guarantee contracts
and financial asset at amortised cost.
Subsequent measurement of financial assets will be based on the classification:
(i)Financial liabilities at fair value through profit or loss (FVTPL)
Held-for-trading financial liabilities (including derivatives that are financial liabilities) and financial
liabilities designated at FVTPL are classified as financial liabilities at FVTP. After initial recognition,
any gain or loss (including interest expense) are recognised in current profit or loss except for those
hedge accounting is applied. For financial liability that is designated as at FVTPL, changes in the fair
value of the financial liability that is attributable to changes in the own credit risk of the issuer shall
be presented in other comprehensive income. At derecognition, cumulative gain or loss previously
recognised under OCI is reclassified to retained earnings.
(ii)Loan commitments and financial guarantee contracts
Loan commitment is a commitment by the Company to provide a loan to customer under specified
contract terms. The provision of impairment losses of loan commitments shall be recognised based
on expected credit losses model.
Financial guarantee contract is a contract that requires the Company to make specified payments to
reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due
in accordance with the original or modified terms of a debt instrument. Financial guarantee contracts
liability shall be subsequently measured at the higher of: The amount of the loss allowance
recognised according to the impairment principles of financial instruments; and the amount initially
recognised less the cumulative amount of income recognised in accordance with the revenue
principles.
(iii) Financial liabilities at amortised cost
After initial recognition, the Company measured other financial liabilities at amortised cost using the
effective interest method.
Except for special situation, financial liabilities and equity instrument should be classified in
accordance with the following principles:
(i) If the Company has no unconditional right to avoid delivering cash or another financial
instrument to fulfill a contractual obligation, this contractual obligation meet the definition of
financial liabilities. Some financial instruments do not comprise terms and conditions related to
obligations of delivering cash or another financial instrument explicitly, they may include contractual
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
obligation indirectly through other terms and conditions.
(ii) If a financial instrument must or may be settled in the Company's own equity instruments, it
should be considered that the Company’s own equity instruments are alternatives of cash or another
financial instrument, or to entitle the holder of the equity instruments to sharing the remaining rights
over the net assets of the issuer. If the former is the case, the instrument is a liability of the issuer;
otherwise, it is an equity instrument of the issuer. Under some circumstances, it is regulated in the
contract that the financial instrument must or may be settled in the Company's own equity
instruments, where, amount of contractual rights and obligations are calculated by multiplying the
number of the equity instruments to be available or delivered by its fair value upon settlement. Such
contracts shall be classified as financial liabilities, regardless that the amount of contractual rights
and liabilities is fixed, or fluctuate totally or partially with variables other than market price of the
entity’s own equity instruments (such as interest rate, price of some kind of goods or some kind of
financial instrument).
(d) Derivatives and embedded derivatives
At initial recognition, derivatives shall be measured at fair value at the date of derivative contracts
are signed and subsequently measured at fair value. The derivative with a positive fair value shall be
recognized as an asset, and with a negative fair value shall be recognised as a liability.
Gains or losses arising from the changes in fair value of derivatives shall be recognised directly into
current profit or loss except for the effective portion of cash flow hedges which shall be recognised
in other comprehensive income and reclassified into current profit or loss when the hedged items
affect profit or loss.
An embedded derivative is a component of a hybrid contract with a financial asset as a host, the
Company shall apply the requirements of financial asset classification to the entire hybrid contract. If
a host that is not a financial asset and the hybrid contract is not measured at fair value with changes in
fair value recognised in profit or loss, and the economic characteristics and risks of the embedded
derivative are not closely related to the economic characteristics and risks of the host, and a separate
instrument with the same terms as the embedded derivative would meet the definition of a derivative,
the embedded derivative shall be separated from the hybrid instrument and accounted for as a
separate derivative instrument. If the Company is unable to measure the fair value of the embedded
derivative at the acquisition date or subsequently at the balance sheet date, the entire hybrid contract
is designated as financial assets or financial liabilities at fair value through profit or loss.
(e) Impairment of financial instrument
The Company shall recognise a loss allowance based on expected credit losses on a financial asset
that is measured at amortised cost, a debt investment at fair value through other comprehensive
income, a contract asset, a lease receivable, a loan commitment and a financial guarantee contract.
(i) Measurement of expected credit losses
Expected credit losses are the weighted average of credit losses of the financial instruments with the
respective risks of a default occurring as the weights. Credit loss is the difference between all
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
contractual cash flows that are due to the Company in accordance with the contract and all the cash
flows that the Company expects to receive (ie all cash shortfalls), discounted at the original effective
interest rate or credit- adjusted effective interest rate for purchased or originated credit-impaired
financial assets.
Lifetime expected credit losses are the expected credit losses that result from all possible default
events over the expected life of a financial instrument.
expected credit losses that result from default events on a financial instrument that are possible
within the 12 months after the reporting date (or the expected lifetime, if the expected life of a
financial instrument is less than 12 months).
At each reporting date, the Company classifies financial instruments into three stages and makes
provisions for expected credit losses accordingly. A financial instrument of which the credit risk has
not significantly increased since initial recognition is at stage 1. The Company shall measure the loss
allowance for that financial instrument at an amount equal to 12-month expected credit losses. A
financial instrument with a significant increase in credit risk since initial recognition but is not
considered to be credit-impaired is at stage 2. The Company shall measure the loss allowance for that
financial instrument at an amount equal to the lifetime expected credit losses. A financial instrument
is considered to be credit-impaired as at the end of the reporting period is at stage 3. The Company
shall measure the loss allowance for that financial instrument at an amount equal to the lifetime
expected credit losses.
The Company may assume that the credit risk on a financial instrument has not increased
significantly since initial recognition if the financial instrument is determined to have low credit risk
at the reporting date and measure the loss allowance for that financial instrument at an amount equal
to 12-month expected credit losses.
For financial instrument at stage 1, stage 2 and those have low credit risk, the interest revenue shall
be calculated by applying the effective interest rate to the gross carrying amount of a financial asset
(ie, impairment loss not been deducted). For financial instrument at stage 3, interest revenue shall be
calculated by applying the effective interest rate to the amortised cost after deducting of impairment
loss.
For notes receivable, accounts receivable and accounts receivable financing, no matter it contains a
significant financing component or not, the Company shall measure the loss allowance at an amount
equal to the lifetime expected credit losses.
Receivables
For the notes receivable, accounts receivable, other receivables, accounts receivable financing and
long-term receivables which are demonstrated to be impaired by any objective evidence, or
applicable for individual assessment, the Company shall individually assess for impairment and
recognise the loss allowance for expected credit losses. If the Company determines that no objective
evidence of impairment exists for notes receivable, accounts receivable, other receivables, accounts
receivable financing and long-term receivables, or the expected credit loss of a single financial asset
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
cannot be assessed at reasonable cost, such notes receivable, accounts receivable, other receivables,
accounts receivable financing and long-term receivables shall be divided into several groups with
similar credit risk characteristics and collectively calculated the expected credit loss. The
determination basis of groups is as following:
Determination basis of notes receivable is as following:
Group 1: Commercial acceptance bills
Group 2: Bank acceptance bills
For each group, the Company calculates expected credit losses through default exposure and the
lifetime expected credit losses rate, taking reference to historical experience for credit losses and
considering current condition and expectation for the future economic situation.
Determination basis of accounts receivable is as following:
Group 1: Accounts receivables due from customers
For each group, the Company calculates expected credit losses through preparing an aging analysis
schedule with the lifetime expected credit losses rate, taking reference to historical experience for
credit losses and considering current condition and expectation for the future economic situation.
Determination basis of other receivables is as following:
Group 1: Deposit and guarantee receivable
Group 2: Employee advance payments
Group 3: Others
For each group, the Company calculates expected credit losses through default exposure and the 12-
months or lifetime expected credit losses rate, taking reference to historical experience for credit
losses and considering current condition and expectation for the future economic situation.
The Company calculates the aging of receivables (notes receivable, accounts receivable, and other
receivables) based on the period from the transaction date to the balance sheet date to determine
credit risk characteristic groups.
Debt investment and other debt investment
For debt investment and other debt investment, the Company shall calculate the expected credit loss
through the default exposure and the 12-month or lifetime expected credit loss rate based on the
nature of the investment, counterparty and the type of risk exposure.
(ii) Low credit risk
If the financial instrument has a low risk of default, the borrower has a strong capacity to meet its
contractual cash flow obligations in the near term and adverse changes in economic and business
conditions in the longer term may, but will not necessarily, reduce the ability of the borrower to
fulfill its contractual cash flow obligations.
(iii) Significant increase in credit risk
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
The Company shall assess whether the credit risk on a financial instrument has increased
significantly since initial recognition, using the change in the risk of a default occurring over the
expected life of the financial instrument, through the comparison of the risk of a default occurring on
the financial instrument as at the reporting date with the risk of a default occurring on the financial
instrument as at the date of initial recognition.
To make that assessment, the Company shall consider reasonable and supportable information, that is
available without undue cost or effort, and that is indicative of significant increases in credit risk
since initial recognition, including forward-looking information. The information considered by the
Company are as following:
? Significant changes in internal price indicators of credit risk as a result of a change in credit risk
since inception
? Existing or forecast adverse change in the business, financial or economic conditions of the
borrower that results in a significant change in the borrower’s ability to meet its debt obligations；
? An actual or expected significant change in the operating results of the borrower; An actual or
expected significant adverse change in the regulatory, economic, or technological environment
of the borrower；
? Significant changes in the value of the collateral supporting the obligation or in the quality of
third-party guarantees or credit enhancements, which are expected to reduce the borrower’s
economic incentive to make scheduled contractual payments or to otherwise influence the
probability of a default occurring;
? Significant change that are expected to reduce the borrower’s economic incentive to make
scheduled contractual payments;
? Expected changes in the loan documentation including an expected breach of contract that may
lead to covenant waivers or amendments, interest payment holidays, interest rate step-ups,
requiring additional collateral or guarantees, or other changes to the contractual framework of
the instrument；
? Significant changes in the expected performance and behavior of the borrower；
? Contractual payments are more than 30 days past due.
Depending on the nature of the financial instruments, the Company shall assess whether the credit
risk has increased significantly since initial recognition on an individual financial instrument or a
group of financial instruments. When assessed based on a group of financial instruments, the
Company can group financial instruments on the basis of shared credit risk characteristics, for
example, past due information and credit risk rating.
Generally, the Company shall determine the credit risk on a financial asset has increased
significantly since initial recognition when contractual payments are more than 30 days past due. The
Company can only rebut this presumption if the Company has reasonable and supportable
information that is available without undue cost or effort, that demonstrates that the credit risk has
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
not increased significantly since initial recognition even though the contractual payments are more
than 30 days past due.
(iv) Credit-impaired financial asset
The Company shall assess at each reporting date whether the credit impairment has occurred for
financial asset at amortised cost and debt investment at fair value through other comprehensive
income. A financial asset is credit-impaired when one or more events that have a detrimental impact
on the estimated future cash flows of that financial asset have occurred. Evidences that a financial
asset is credit-impaired include observable data about the following events:
Significant financial difficulty of the issuer or the borrower；a breach of contract, such as a default
or past due event; the lender(s) of the borrower, for economic or contractual reasons relating to the
borrower’s financial difficulty, having granted to the borrower a concession(s) that the lender(s)
would not otherwise consider；it is becoming probable that the borrower will enter bankruptcy or
other financial reorganisation;the disappearance of an active market for that financial asset because
of financial difficulties ； the purchase or origination of a financial asset at a deep discount that
reflects the incurred credit losses.
(v) Presentation of impairment of expected credit loss
In order to reflect the changes of credit risk of financial instrument since initial recognition, the
Company shall at each reporting date remeasure the expected credit loss and recognise in profit or
loss, as an impairment gain or loss, the amount of expected credit losses addition (or reversal). For
financial asset at amortised cost, the loss allowance shall reduce the carrying amount of the financial
asset in the statement of financial position; for debt investment at fair value through other
comprehensive income, the loss allowance shall be recognised in other comprehensive income and
shall not reduce the carrying amount of the financial asset in the statement of financial position.
(vi) Write-off
The Company shall directly reduce the gross carrying amount of a financial asset when the Company
has no reasonable expectations of recovering the contractual cash flow of a financial asset in its
entirety or a portion thereof. Such write-off constitutes a derecognition of the financial asset. This
circumstance usually occurs when the Company determines that the debtor has no assets or sources
of income that could generate sufficient cash flow to repay the write-off amount.
Recovery of financial asset written off shall be recognised in profit or loss as reversal of impairment
loss.
(f) Transfer of financial assets
Transfer of financial assets refers to following two situations:
? Transfers the contractual rights to receive the cash flows of the financial asset;
? Transfers the entire or a part of a financial asset and retains the contractual rights to receive the
cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or
more recipients.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(i) Derecognition of transferred assets
If the Company transfers substantially all the risks and rewards of ownership of the financial asset, or
neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset
but has not retained control of the financial asset, the financial asset shall be derecognised.
Whether the Company has retained control of the transferred asset depends on the transferee’s ability
to sell the asset. If the transferee has the practical ability to sell the asset in its entirety to an unrelated
third party and is able to exercise that ability unilaterally and without needing to impose additional
restrictions on the transfer, the Company has not retained control.
The Company judges whether the transfer of financial asset qualifies for derecognition based on the
substance of the transfer.
If the transfer of financial asset qualifies for derecognition in its entirety, the difference between the
following shall be recognised in profit or loss:
? The carrying amount of transferred financial asset;
? The sum of consideration received and the part derecognised of the cumulative changes in fair
value previously recognised in other comprehensive income (The financial assets involved in the
transfer are classified as financial assets at fair value through other comprehensive income in
accordance with Article 18 of the Accounting Standards for Business Enterprises - Recognition
and Measurement of Financial Instruments).
If the transferred asset is a part of a larger financial asset and the part transferred qualifies for
derecognition, the previous carrying amount of the larger financial asset shall be allocated between
the part that continues to be recognised (For this purpose, a retained servicing asset shall be treated
as a part that continues to be recognised) and the part that is derecognised, based on the relative fair
values of those parts on the date of the transfer. The difference between following two amounts shall
be recognised in profit or loss:
? The carrying amount (measured at the date of derecognition) allocated to the part derecognised；
? The sum of the consideration received for the part derecognised and part derecognised of the
cumulative changes in fair value previously recognised in other comprehensive income (The
financial assets involved in the transfer are classified as financial assets at fair value through
other comprehensive income in accordance with Article 18 of the Accounting Standards for
Business Enterprises - Recognition and Measurement of Financial Instruments).
(ii) Continuing involvement in transferred assets
If the Company neither transfers nor retains substantially all the risks and rewards of ownership of a
transferred asset, and retains control of the transferred asset, the Company shall continue to recognise
the transferred asset to the extent of its continuing involvement and also recognise an associated
liability.
The extent of the Company’s continuing involvement in the transferred asset is the extent to which it
is exposed to changes in the value of the transferred asset
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(iii) Continue to recognise the transferred assets
If the Company retains substantially all the risks and rewards of ownership of the transferred
financial asset, the Company shall continue to recognise the transferred asset in its entirety and the
consideration received shall be recognised as a financial liability.
The financial asset and the associated financial liability shall not be offset. In subsequent accounting
period, the Company shall continuously recognise any income (gain) arising from the transferred
asset and any expense (loss) incurred on the associated liability.
(g) Offsetting financial assets and financial liabilities
Financial assets and financial liabilities shall be presented separately in the statement of financial
position and shall not be offset. When meets the following conditions, financial assets and financial
liabilities shall be offset and the net amount presented in the statement of financial position:
The Company currently has a legally enforceable right to set off the recognised amounts; The
Company intends either to settle on a net basis, or to realise the asset and settle the liability
simultaneously.
In accounting for a transfer of a financial asset that does not qualify for derecognition, the Company
shall not offset the transferred asset and the associated liability.
(h) Determination of fair value of financial instruments
Determination of fair value of financial assets and financial liabilities please refer to Note 3.12
Fair value refers to the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date.
The Company determines fair value of the related assets and liabilities based on market value in the
principal market, or in the absence of a principal market, in the most advantageous market price for
the related asset or liability. The fair value of an asset or a liability is measured using the
assumptions that market participants would use when pricing the asset or liability, assuming that
market participants act in their economic best interest.
The principal market is the market in which transactions for an asset or liability take place with the
greatest volume and frequency. The most advantageous market is the market which maximizes the
value that could be received from selling the asset and minimizes the value which is needed to be
paid in order to transfer a liability, considering the effect of transport costs and transaction costs both.
If the active market of the financial asset or financial liability exists, the Company shall measure the
fair value using the quoted price in the active market. If the active market of the financial instrument
is not available, the Company shall measure the fair value using valuation techniques.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to
generate economic benefits by using the asset in its highest and best use or by selling it to another
market participant that would use the asset in its highest and best use.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
? Valuation techniques
The Company uses valuation techniques that are appropriate in the circumstances and for which
sufficient data are available to measure fair value, including the market approach, the income
approach and the cost approach. The Company shall use valuation techniques consistent with one or
more of those approaches to measure fair value. If multiple valuation techniques are used to measure
fair value, the results shall be evaluated considering the reasonableness of the range of values
indicated by those results. A fair value measurement is the point within that range that is most
representative of fair value in the circumstances.
When using the valuation technique, the Company shall give the priority to relevant observable
inputs. The unobservable inputs can only be used when relevant observable inputs is not available or
practically would not be obtained. Observable inputs refer to the information which is available from
market and reflects the assumptions that market participants would use when pricing the asset or
liability. Unobservable Inputs refer to the information which is not available from market and it has
to be developed using the best information available in the circumstances from the assumptions that
market participants would use when pricing the asset or liability.
? Fair value hierarchy
To Company establishes a fair value hierarchy that categorises into three levels the inputs to
valuation techniques used to measure fair value. The fair value hierarchy gives the highest priority to
Level 1 inputs and second to the Level 2 inputs and the lowest priority to Level 3 inputs. Level 1
inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity
can access at the measurement date. Level 2 inputs are inputs other than quoted prices included
within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs
are unobservable inputs for the asset or liability.
(a) Classification of inventories
Inventories are finished goods or products held for sale in the ordinary course of business, in the
process of production for such sale, or in the form of materials or supplies to be consumed in the
production process or in the rendering of services, including raw materials, work in progress, and
goods in stock, etc.
(b) Measurement method of cost of inventories sold or used
The cost of raw materials and goods in stock (except the branded luxury watch inventory) used or
sold is determined on the weighted average basis, while the cost of the branded luxury watch
inventory used or sold is determined on individual valuation method basis.
(c) Inventory system
The perpetual inventory system is adopted. The inventories should be counted at least once a year,
and surplus or losses of inventory stocktaking shall be included in current profit and loss.
(d) Recognition Criteria and Provision for impairment of inventory
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Inventories are stated at the lower of cost and net realizable value. The excess of cost over net
realizable value of the inventories is recognised as provision for impairment of inventory, and
recognised in current profit or loss.
Net realizable value of the inventory should be determined on the basis of reliable evidence obtained,
and factors such as purpose of holding the inventory and impact of post balance sheet event shall be
considered.
(i) In normal operation process, finished goods, products and materials for direct sale, their net
realizable values are determined at estimated selling prices less estimated selling expenses and
relevant taxes and surcharges; for inventories held to execute sales contract or service contract, their
net realizable values are calculated on the basis of contract price. If the quantities of inventories
specified in sales contracts are less than the quantities held by the Company, the net realizable value
of the excess portion of inventories shall be based on general selling prices. Net realizable value of
materials held for sale shall be measured based on market price.
(ii) For materials in stock need to be processed, in the ordinary course of production and business,
net realisable value is determined at the estimated selling price less the estimated costs of completion,
the estimated selling expenses and relevant taxes. If the net realisable value of the finished products
produced by such materials is higher than the cost, the materials shall be measured at cost; if a
decline in the price of materials indicates that the cost of the finished products exceeds its net
realisable value, the materials are measured at net realisable value and differences shall be
recognised at the provision for impairment.
(iii) Provisions for inventory impairment are generally determined on an individual basis. For
inventories with large quantity and low unit price, the provisions for inventory impairment are
determined on group basis.
(iv) If any factor rendering write-downs of the inventories has been eliminated at the reporting date,
the amounts written down are recovered and reversed to the extent of the inventory impairment,
which has been provided for. The reversal shall be included in profit or loss.
The Company shall present contract assets or contract liabilities in the statement of financial position,
depending on the relationship between the Company’s satisfying a performance obligation and the
customer’s payment. A contract asset shall be presented if the Company has the right to
consideration in exchange for goods or services that the Company has transferred to a customer
when that right is conditioned on something other than the passage of time. A contract liability shall
be presented if the Company has the obligation to transfer goods or services to a customer for which
the Company has received consideration (or the amount is due) from the customer.
Method of determination and accounting for expected credit loss for contract assets please refer to
Note 3.11.
Contract assets and contract liabilities shall be presented separately in the statement of financial
position. The contract asset and contract liability for the same contract shall be presented on a net
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
basis. A net balance shall be listed in the item of "Contract assets" or "Other non-current assets"
according to its liquidity; a credit balance shall be listed in the item of "Contract liabilities" or "Other
non-current liabilities" according to its liquidity. Contract assets and contract liabilities for different
contracts cannot be offset.
Contract costs include costs to fulfill a contract and the costs to obtain a contract.
The Company shall recognise an asset from the costs incurred to fulfill a contract only if those costs
meet all of the following criteria:
(i) the costs relate directly to a contract or to an anticipated contract, including: direct labour,
direct materials, manufacturing costs (or similar costs), costs that are explicitly chargeable to
the customer under the contract and other costs that are incurred only because an entity
entered into the contract;
(ii) the costs enhance resources of the Company that will be used in satisfying performance
obligations in the future; and
(iii) the costs are expected to be recovered.
The incremental costs of obtaining a contract shall be recognised as an asset if the Company expects
to recover them.
An asset related to contract costs shall be amortised on a systematic basis that is consistent with the
revenue recognition of the goods or services to which the asset relates. The Company recognises the
contract acquisition costs as an expense when incurred if the amortisation period of the asset that the
Company otherwise would have recognised is one year or less.
The Company shall accrue the provision for impairment, recognise an impairment loss in profit or
loss to the extent that the carrying amount of an asset related to the contract cost exceeds the
difference of below two items, and further consider whether the estimated liability related to the
onerous contract needs to be accrued:
(i) the remaining amount of consideration that the Company expects to receive in exchange for
the goods or services to which the asset relates; less
(ii) the costs that relate directly to providing those goods or services and that have not been
recognised as expenses.
The Company shall recognise in profit or loss a reversal of some or all of an impairment loss
previously recognised when the impairment conditions no longer exist or have improved. The
increased carrying amount of the asset shall not exceed the amount that would have been determined
(net of amortisation) if no impairment loss had been recognised previously.
Providing that the costs to fulfil a contract satisfy the requirement to be recognised as an asset, the
Company shall present them in the account “Inventory” if the contract has an original expected
duration of one year (or a normal operating cycle) or less, or in the account “Other non-current assets”
if the contract has an original expected duration of more than one year (or a normal operating cycle).
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Providing that the costs to obtain a contract satisfy the requirement to be recgonised as an asset, the
Company shall present them in the account “Other current asset” if the contract has an original
expected duration of one year (or a normal operating cycle) or less, or in the account “Other non-
current assets” if the contract has an original expected duration of more than one year (or a normal
operating cycle).
Long-term equity investments refer to equity investments where an investor has control of, or
significant influence over, an investee, as well as equity investments in joint ventures. Associates of
the Company are those entities over which the Company has significant influence.
(a) Determination basis of joint control or significant influence over the investee
Joint control is the relevant agreed sharing of control over an arrangement, and the arranged relevant
activity must be decided under unanimous consent of the parties sharing control. In assessing
whether the Company has joint control of an arrangement, the Company shall assess first whether all
the parties, or a group of the parties, control the arrangement. When all the parties, or a group of the
parties, considered collectively, are able to direct the activities of the arrangement, the parties control
the arrangement collectively. Then the Company shall assess whether decisions about the relevant
activities require the unanimous consent of the parties that collectively control the arrangement. If
two or more groups of the parties could control the arrangement collectively, it shall not be assessed
as have joint control of the arrangement. When assessing the joint control, the protective rights are
not considered.
Significant influence is the power to participate in the financial and operating policy decisions of the
investee but is not control or joint control of those policies. In determination of significant influence
over an investee, the Company should consider not only the existing voting rights directly or
indirectly held but also the effect of potential voting rights held by the Company and other entities
that could be currently exercised or converted, including the effect of share warrants, share options
and convertible corporate bonds that issued by the investee and could be converted in current period.
If the Company holds, directly or indirectly 20% or more but less than 50% of the voting power of
the investee, it is presumed that the Company has significant influence of the investee, unless it can
be clearly demonstrated that in such circumstance, the Company cannot participate in the decision-
making in the production and operating of the investee.
(b) Determination of initial investment cost
(i) Long-term equity investments generated in business combinations
For a business combination involving enterprises under common control, if the Company makes
payment in cash, transfers non-cash assets or bears liabilities as the consideration for the business
combination, the share of carrying amount of the owners’ equity of the acquiree in the consolidated
financial statements of the ultimate controlling party is recognised as the initial cost of the long-term
equity investment on the combination date. The difference between the initial investment cost and
the carrying amount of cash paid, non-cash assets transferred and liabilities assumed shall be
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
adjusted against the capital reserve; if capital reserve is not enough to be offset, undistributed profit
shall be offset in turn.
For a business combination involving enterprises under common control, if the Company issues
equity securities as the consideration for the business combination, the share of carrying amount of
the owners’ equity of the acquiree in the consolidated financial statements of the ultimate controlling
party is recognised as the initial cost of the long-term equity investment on the combination date.
The total par value of the shares issued is recognised as the share capital. The difference between the
initial investment cost and the carrying amount of the total par value of the shares issued shall be
adjusted against the capital reserve; if capital reserve is not enough to be offset, undistributed profit
shall be offset in turn.
For business combination not under common control, the assets paid, liabilities incurred or assumed
and the fair value of equity securities issued to obtain the control of the acquiree at the acquisition
date shall be determined as the cost of the business combination and recognised as the initial cost of
the long-term equity investment. The audit, legal, valuation and advisory fees, other intermediary
fees, and other relevant general administrative costs incurred for the business combination, shall be
recognised in profit or loss as incurred.
(ii) Long-term equity investments acquired not through the business combination, the investment
cost shall be determined based on the following requirements:
For long-term equity investments acquired by payments in cash, the initial cost is the actually paid
purchase cost, including the expenses, taxes and other necessary expenditures directly related to the
acquisition of long-term equity investments.
For long-term equity investments acquired through issuance of equity securities, the initial cost is the
fair value of the issued equity securities.
For the long-term equity investments obtained through exchange of non-monetary assets, if the
exchange has commercial substance, and the fair values of assets traded out and traded in can be
measured reliably, the initial cost of long-term equity investment traded in with non-monetary assets
are determined based on the fair values of the assets traded out together with relevant taxes.
Difference between fair value and book value of the assets traded out is recorded in current profit or
loss. If the exchange of non-monetary assets does not meet the above criterion, the book value of the
assets traded out and relevant taxes are recognised as the initial investment cost.
For long-term equity investment acquired through debt restructuring, the initial cost is determined
based on the fair value of the equity obtained and the difference between initial investment cost and
carrying amount of debts shall be recorded in current profit or loss.
(c) Subsequent measurement and recognition of profit or loss
Long-term equity investment to an entity over which the Company has ability of control shall be
accounted for at cost method. Long-term equity investment to a joint venture or an associate shall be
accounted for at equity method.
(i) Cost method
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
For Long-term equity investment at cost method, cost of the long-term equity investment shall be
adjusted when additional amount is invested or a part of it is withdrawn. The Company recognises its
share of cash dividends or profits which have been declared to distribute by the investee as current
investment income.
(ii) Equity method
If the initial cost of the investment is in excess of the share of the fair value of the net identifiable
assets in the investee at the date of investment, the difference shall not be adjusted to the initial cost
of long-term equity investment; if the initial cost of the investment is in short of the share of the fair
value of the net identifiable assets in the investee at the date investment, the difference shall be
included in the current profit or loss and the initial cost of the long-term equity investment shall be
adjusted accordingly.
The Company recognises the share of the investee’s net profits or losses, as well as its share of the
investee’s other comprehensive income, as investment income or losses and other comprehensive
income respectively, and adjusts the carrying amount of the investment accordingly. The carrying
amount of the investment shall be reduced by the share of any profit or cash dividends declared to
distribute by the investee. The investor’s share of the investee’s owners’ equity changes, other than
those arising from the investee’s net profit or loss, other comprehensive income or profit distribution,
shall be recognised in the investor’s equity, and the carrying amount of the long-term equity
investment shall be adjusted accordingly. The Company recognises its share of the investee’s net
profits or losses after making appropriate adjustments of investee’s net profit based on the fair values
of the investee’s identifiable net assets at the investment date. If the accounting policy and
accounting period adopted by the investee is not in consistency with the Company, the financial
statements of the investee shall be adjusted according to the Company’s accounting policies and
accounting period, based on which, investment income or loss and other comprehensive income, etc.,
shall be adjusted. The unrealized profits or losses resulting from inter-company transactions between
the company and its associate or joint venture are eliminated in proportion to the company’s equity
interest in the investee, based on which investment income or losses shall be recognised. Any losses
resulting from inter-company transactions between the investor and the investee, which belong to
asset impairment, shall be recognised in full.
Where the Company obtains the power of joint control or significant influence, but not control, over
the investee, due to additional investment or other reason, the relevant long-term equity investment
shall be accounted for by using the equity method, initial cost of which shall be the fair value of the
original investment plus the additional investment. Where the original investment is classified as
other equity investment, difference between its fair value and the carrying value, in addition to the
cumulative changes in fair value previously recorded in other comprehensive income, shall be
recogised into retained earnings of the period of using equity method.
If the Company loses the joint control or significant influence of the investee for some reasons such
as disposal of equity investment, the retained interest shall be measured at fair value and the
difference between the carrying amount and the fair value at the date of loss the joint control or
significant influence shall be recognised in profit or loss. When the Company discontinues the use of
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
the equity method, the Company shall account for all amounts previously recognised in other
comprehensive income under equity method in relation to that investment on the same basis as
would have been required if the investee had directly disposed of the related assets or liabilities.
(d) Impairment testing and provision for impairment loss
For investment in subsidiaries, associates or a joint ventures, provision for impairment loss please
refer to Note 3.22.
(a) Classification of investment properties
Investment properties are properties to earn rentals or for capital appreciation or both, including:
(i)Land use right leased out
(ii)Land held for transfer upon appreciation
(iii)Buildings leased out
(b) The measurement model of investment property
The Company adopts the cost model for subsequent measurement of investment properties. For
provision for impairment please refer to Note 3.22.
The Company calculates the depreciation or amortization based on the net amount of investment
property cost less the accumulated impairment and the net residual value using straight-line method.
The estimated useful life and annual depreciation rates which are determined according to the
categories, estimated economic useful lives and estimated net residual rates are listed as followings:
Estimated useful Annual depreciation rates
Category Residual rates (%)
life (year) (%)
Buildings and constructions 20-35 5.00 2.71-4.85
Fixed assets refer to the tangible assets with higher unit price held for the purpose of producing
commodities, rendering services, renting or business management with useful lives exceeding one
year.
(a) Recognition criteria of fixed assets
Fixed assets will only be recognised at the actual cost paid when obtaining as all the following
criteria are satisfied:
(i) It is probable that the economic benefits relating to the fixed assets will flow into the Company;
(ii) The costs of the fixed assets can be measured reliably.
Subsequent expenditure for fixed assets shall be recorded in cost of fixed assets, if recognition
criteria of fixed assets are satisfied, otherwise the expenditure shall be recorded in current profit or
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
loss when incurred.
(b) Depreciation methods of fixed assets
The Company begins to depreciate the fixed asset from the next month after it is available for
intended use using the straight-line-method. The estimated useful life and annual depreciation rates
which are determined according to the categories, estimated economic useful lives and estimated net
residual rates of fixed assets are listed as followings:
Depreciation Estimated useful Residual rates Annual depreciation
Category
method life (year) (%) rates (%)
Buildings and straight-line-
constructions method
straight-line-
Machinery equipment 10 5.00-10.00 9.00-9.50
method
straight-line-
Electrical equipment 5 5.00 19.00
method
straight-line-
Vehicles 5 5.00 19.00
method
straight-line-
Other equipment 5 5.00 19.00
method
For the fixed assets with impairment provided, the impairment provision should be excluded from
the cost when calculating depreciation.
At the end of reporting period, the Company shall review the useful life, estimated net residual value
and depreciation method of the fixed assets. Estimated useful life of the fixed assets shall be adjusted
if it is changed compared to the original estimation.
(a) Classification of construction in progress
Construction in progress is measured on an individual project basis.
(b) Recognition criteria and timing of transfer from construction in progress to fixed assets
The initial book values of the fixed assets are stated at total expenditures incurred before they are
ready for their intended use, including construction costs, original price of machinery equipment,
other necessary expenses incurred to bring the construction in progress to get ready for its intended
use and borrowing costs of the specific loan for the construction or the proportion of the general loan
used for the constructions incurred before they are ready for their intended use. The construction in
progress shall be transferred to fixed asset when the installation or construction is ready for the
intended use. For construction in progress that has been ready for their intended use but relevant
budgets for the completion of projects have not been completed, the estimated values of project
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
budgets, prices, or actual costs should be included in the costs of relevant fixed assets, and
depreciation should be provided according to relevant policies of the Company when the fixed assets
are ready for intended use. After the completion of budgets needed for the completion of projects, the
estimated values should be substituted by actual costs, but depreciation already provided is not
adjusted.
(a) Recognition criteria and period for capitalization of borrowing costs
The Company shall capitalize the borrowing costs that are directly attributable to the acquisition,
construction or production of qualifying assets when meet the following conditions:
(i) Expenditures for the asset are being incurred;
(ii) Borrowing costs are being incurred, and;
(iii) Acquisition, construction or production activities that are necessary to prepare the assets for their
intended use or sale are in progress.
Other borrowing cost, discounts or premiums on borrowings and exchange differences on foreign
currency borrowings shall be recognized into current profit or loss when incurred.
Capitalization of borrowing costs is suspended during periods in which the acquisition, construction
or production of a qualifying asset is interrupted abnormally and the interruption is for a continuous
period of more than 3 months.
Capitalization of such borrowing costs ceases when the qualifying assets being acquired, constructed
or produced become ready for their intended use or sale. The expenditure incurred subsequently shall
be recognised as expenses when incurred.
(b) Capitalization rate and measurement of capitalized amounts of borrowing costs
When funds are borrowed specifically for purchase, construction or manufacturing of assets eligible
for capitalization, the Company shall determine the amount of borrowing costs eligible for
capitalisation as the actual borrowing costs incurred on that borrowing during the period less any
interest income on bank deposit or investment income on the temporary investment of those
borrowings.
Where funds allocated for purchase, construction or manufacturing of assets eligible for
capitalization are part of a general borrowing, the eligible amounts are determined by the weighted-
average of the cumulative capital expenditures in excess of the specific borrowing multiplied by the
general borrowing capitalization rate. The capitalisation rate will be the weighted average of the
borrowing costs applicable to the general borrowing.
(a) Measurement method of intangible assets
Intangible assets are recognised at actual cost at acquisition.
(b) The useful life and amortisation of intangible assets
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(i) The estimated useful lives of the intangible assets with finite useful lives are as follows:
Estimated useful
Category Basis
life
Land use right 50years Legal life
The service life is determined by reference to the
Software 5 years period that can bring economic benefits to the
Company
The service life is determined by reference to the
Right to use the trademark 5-10 years period that can bring economic benefits to the
Company
For intangible assets with finite useful life, the estimated useful life and amortisation method are
reviewed annually at the end of each reporting period and adjusted when necessary. No change has
incurred in current year in the estimated useful life and amortisation method upon review.
(ii) Assets of which the period to bring economic benefits to the Company are unforeseeable are
regarded as intangible assets with indefinite useful lives. The Company reassesses the useful lives of
those assets at every year end. If the useful lives of those assets are still indefinite, impairment test
should be performed on those assets at the balance sheet date.
(iii) Amortisation of the intangible assets
For intangible assets with finite useful lives, their useful lives should be determined upon their
acquisition and systematically amortised on a straight-line basis [units of production method] over
the useful life. The amortisation amount shall be recognised into current profit or loss or capitalized
as part of the cost of the related asset according to the beneficial items. The amount to be amortised
is cost deducting residual value. For intangible assets which has impaired, the cumulative
impairment provision shall be deducted as well. The residual value of an intangible asset with a finite
useful life shall be assumed to be zero unless: there is a commitment by a third party to purchase the
asset at the end of its useful life; or there is an active market for the asset and residual value can be
determined by reference to that market; and it is probable that such a market will exist at the end of
the asset’s useful life.
Intangible assets with indefinite useful lives shall not be amortised. The Company reassesses the
useful lives of those assets at every year end. If there is evidence to indicate that the useful lives of
those assets become finite, the useful lives shall be estimated and the intangible assets shall be
amortised systematically and reasonably within the estimated useful lives.
(c) Scope of Research and Development Expenditures
The Company classifies the expenses directly related to research and development activities as
research and development expenditures, including remuneration of research and development staff,
direct material, depreciation cost and long-term amortised expense, design fee, equipment
commissioning fee, intangible assets amortisation cost, outsourcing research and development cost,
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
and other expenses, etc.
(d) Criteria of classifying expenditures on internal research and development projects into
research phase and development phase
Preparation activities related to materials and other relevant aspects undertaken by the Company for
the purpose of further development shall be treated as research phase.
Expenditures incurred during the research phase of internal research and development projects shall
be recognised in profit or loss when incurred.
Development activities after the research phase of the Company shall be treated as development
phase.
(e) Criteria for capitalization of qualifying expenditures during the development phase
Expenditures arising from development phase on internal research and development projects shall be
recognised as intangible assets only if all of the following conditions have been met:
(i) Technical feasibility of completing the intangible assets so that they will be available for use or
sale;
(ii) Its intention to complete the intangible asset and use or sell it;
(iii) The method that the intangible assets generate economic benefits, including the Company can
demonstrate the existence of a market for the output of the intangible assets or the intangible assets
themselves or, if it is to be used internally, the usefulness of the intangible assets;
(iv) The availability of adequate technical, financial and other resources to complete the development
and to use or sell the intangible asset; and
(v) Its ability to measure reliably the expenditure attributable to the intangible asset.
Impairment loss of long-term equity investment in subsidiaries, associates and joint ventures,
investment properties subsequently measured at cost, fixed assets ,constructions in progress,
intangible assets, and right of use assets, shall be determined according to following method:
The Company shall assess at the end of each reporting period whether there is any indication that an
asset may be impaired. If any such indication exists, the Company shall estimate the recoverable
amount of the asset and test for impairment. Irrespective of whether there is any indication of
impairment, the Company shall test for impairment of goodwill acquired in a business combination,
intangible assets with an indefinite useful life or intangible assets not yet available for use annually.
The recoverable amounts of the long-term assets are the higher of their fair values less costs to
dispose and the present values of the estimated future cash flows of the long-term assets. The
Company estimate the recoverable amounts on an individual basis. If it is difficult to estimate the
recoverable amount of the individual asset, the Company estimates the recoverable amount of the
groups of assets that the individual asset belongs to. Identification of a group of asset is based on
whether the cash inflows from it are largely independent of the cash inflows from other assets or
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
groups of assets.
If, and only if, the recoverable amount of an asset or a group of assets is less than its carrying amount,
the carrying amount of the asset shall be reduced to its recoverable amount and the provision for
impairment loss shall be recognised accordingly.
When test for impairment, if there is an indication that relevant group of assets or combination of
asset groups may be impaired, impairment testing for group of assets or combination of asset groups
excluding goodwill shall be conducted first, and the recoverable amount shall be then calculated and
the impairment loss shall be recognised accordingly. Then the group of assets or combination of asset
groups including goodwill shall be tested for impairment, by comparing the carrying amount with its
recoverable amount. If the recoverable amount is less than the carrying amount, the Company shall
recognise the impairment loss.
The mentioned impairment loss will not be reversed in subsequent accounting period once it had
been recognised.
Long-term deferred expenses are various expenses already incurred, which shall be amortised over
current and subsequent periods with the amortisation period exceeding one year.Long-term deferred
expenses are evenly amortised over the beneficial period.
Employee benefits refer to all forms of consideration or compensation given by the Company in
exchange for service rendered by employees or for the termination of employment relationship.
Employee benefits include short-term employee benefits, post-employment benefits, termination
benefits and other long-term employee benefits. Benefits provided to an employee's spouse, children,
dependents, family members of decreased employees, or other beneficiaries are also employee
benefits.
According to liquidity, employee benefits are presented in the statement of financial position as
“Employee benefits payable” and “Long-term employee benefits payable”.
(a) Short-term employee benefits
(i) Employee basic salary (salary, bonus, allowance, subsidy)
The Company recognises, in the accounting period in which an employee provides service, actually
occurred short-term employee benefits as a liability, with a corresponding charge to current profit
except for those recognised as capital expenditure based on the requirement of accounting standards.
(ii) Employee welfare
The Company shall recognise the employee welfare based on actual amount when incurred into
current profit or loss or related capital expenditure. Employee welfare shall be measured at fair value
as it is a non-monetary benefits.
(iii) Social insurance such as medical insurance, work injury insurance and maternity insurance,
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
housing funds, labor union fund and employee education fund
Payments made by the Company of social insurance for employees, such as medical insurance, work
injury insurance and maternity insurance, payments of housing funds, and labor union fund and
employee education fund accrued in accordance with relevant requirements, in the accounting period
in which employees provide services, is calculated according to required accrual bases and accrual
ratio in determining the amount of employee benefits and the related liabilities, which shall be
recognised in current profit or loss or the cost of relevant asset.
(iv) Short-term paid absences
The company shall recognise the related employee benefits arising from accumulating paid absences
when the employees render service that increases their entitlement to future paid absences. The
additional payable amounts shall be measured at the expected additional payments as a result of the
unused entitlement that has accumulated. The Company shall recognise relevant employee benefit of
non-accumulating paid absences when the absences actually occurred.
(v)Short-term profit-sharing plan
The Company shall recognise the related employee benefits payable under a profit-sharing plan
when all of the following conditions are satisfied:
? The Company has a present legal or constructive obligation to make such payments as a
result of past events; and
? A reliable estimate of the amounts of employee benefits obligation arising from the profit-
sharing plan can be made.
(b) Post-employment benefits
(i) Defined contribution plans
The Company shall recognise, in the accounting period in which an employee provides service, the
contribution payable to a defined contribution plan as a liability, with a corresponding charge to the
current profit or loss or the cost of a relevant asset.
When contributions to a defined contribution plan are not expected to be settled wholly before
twelve months after the end of the annual reporting period in which the employees render the related
service, they shall be discounted using relevant discount rate (market yields at the end of the
reporting period on high quality corporate bonds in active market or government bonds with the
currency and term which shall be consistent with the currency and estimated term of the defined
contribution obligations) to measure employee benefits payable.
(ii) Defined benefit plan
The present value of defined benefit obligation and current service costs
Based on the expected accumulative welfare unit method, the Company shall make estimates about
demographic variables and financial variables in adopting the unbiased and consistent actuarial
assumptions and measure defined benefit obligation, and determine the obligation period. The
Company shall discount the obligation arising from defined benefit plan using relevant discount rate
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(market yields at the end of the reporting period on high quality corporate bonds in active market or
government bonds with the currency and term which shall be consistent with the currency and
estimated term of the defined benefit obligations) in order to determine the present value of the
defined benefit obligation and the current service cost.
The net defined benefit liability or asset
The net defined benefit liability (asset) is the deficit or surplus recognised as the present value of the
defined benefit obligation less the fair value of plan assets (if any).
When the Company has a surplus in a defined benefit plan, it shall measure the net defined benefit
asset at the lower of the surplus in the defined benefit plan and the asset ceiling.
The amount recognised in the cost of asset or current profit or loss
Service cost comprises current service cost, past service cost and any gain or loss on settlement.
Other service cost shall be recognised in profit or loss unless accounting standards require or allow
the inclusion of current service cost within the cost of assets.
Net interest on the net defined benefit liability (asset) comprising interest income on plan assets,
interest cost on the defined benefit obligation and interest on the effect of the asset ceiling, shall be
included in profit or loss.
The amount recognised in other comprehensive income
Changes in the net liability or asset of the defined benefit plan resulting from the remeasurements
including:
? Actuarial gains and losses, the changes in the present value of the defined benefit obligation
resulting from experience adjustments or the effects of changes in actuarial assumptions;
? Return on plan assets, excluding amounts included in net interest on the net defined benefit
liability or asset;
? Any change in the effect of the asset ceiling, excluding amounts included in net interest on
the net defined benefit liability (asset).
Remeasurements of the net defined benefit liability (asset) recognised in other comprehensive
income shall not be reclassified to profit or loss in a subsequent period. Upon termination of the
original defined benefit plan, the Company may, within equity, transfer the entire amount previously
recognized in other comprehensive income to retained earning.
(c) Termination benefits
The Company providing termination benefits to employees shall recognise an employee benefits
liability for termination benefits, with a corresponding charge to the profit or loss of the reporting
period, at the earlier of the following dates:
(i) When the Company cannot unilaterally withdraw the offer of termination benefits because of an
employment termination plan or a curtailment proposal.
(ii) When the Company recognises costs or expenses related to a restructuring that involves the
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
payment of termination benefits.
If the termination benefits are not expected to be settled wholly before twelve months after the end of
the annual reporting period, the Company shall discount the termination benefits using relevant
discount rate (market yields at the end of the reporting period on high quality corporate bonds in
active market or government bonds with the currency and term which shall be consistent with the
currency and estimated term of the defined benefit obligations) to measure the employee benefits.
(d) Other long-term employee benefits
(i) Meet the conditions of the defined contribution plan
When other long-term employee benefits provided by the Company to the employees satisfies the
conditions for classifying as a defined contribution plan, all those benefits payable shall be accounted
for as employee benefits payable at their discounted value.
(ii) Meet the conditions of the defined benefit plan
At the end of the reporting period, the Company recognised the cost of employee benefit from other
long-term employee benefits as the following components:
? Service costs;
? Net interest cost for net liability or asset of other long-term employee benefits
? Changes resulting from the remeasurements of the net liability or asset of other long-term
employee benefits
In order to simplify the accounting treatment, the net amount of above items shall be recognised in
profit or loss or relevant cost of assets.
(a) Recognition criteria of estimated liabilities
The Company recognises the estimated liabilities when obligations related to contingencies satisfy
all the following conditions:
(i) That obligation is a current obligation of the Company;
(ii) It is likely to cause any economic benefit to flow out of the Company as a result of performance
of the obligation; and
(iii) The amount of the obligation can be measured reliably.
(b) Measurement method of estimated liabilities
The estimated liabilities of the Company are initially measured at the best estimate of expenses
required for the performance of relevant present obligations. The Company, when determining the
best estimate, has had a comprehensive consideration of risks with respect to contingencies,
uncertainties and the time value of money. The carrying amount of the estimated liabilities shall be
reviewed at the end of every reporting period. If conclusive evidences indicate that the carrying
amount fails to be the best estimate of the estimated liabilities, the carrying amount shall be adjusted
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
based on the updated best estimate.
(a) Classification of share-based payments
Share-based payments of the Company include equity-settled share-based payments and cash-settled
share-based payments.
(b) Determining fair value of equity instruments
(i) The fair value of shares granted to the employees can be determined by reference to the quotations
in the active market, adjusted in accordance with the terms and conditions granted (excluding vesting
conditions other than market conditions).
(ii) For share option granted to the employees, it is usually difficult to obtain its market price. If the
share option with similar terms and conditions is not available, the Company estimates the fair value
of those options using an applicable option pricing model.
(c) Basis of best estimate of equity instruments expected to vest
Every balance sheet date during the vesting period, the Company makes best estimate according to
the most updated number of employees that are eligible to exercise their options and revises the
number of equity instruments expected to vest in order to make the best estimate of equity
instruments expected to vest.
(d) Accounting for implementation of share-based payment programs
Cash-settled share-based payment
(i) For cash-settled share-based payment vested immediately after granting, the Company shall
recognise relevant costs or expenses at the fair value of the liability borne at grant date and a
corresponding increase in liability. Until the liability is settled, the Company shall remeasure the fair
value of the liability at the end of each reporting period and at the date of settlement, with any
changes in fair value recognised in profit or loss.
(ii) If the share instrument do not vest until services during the vesting period are completed or
performance conditions are satisfied during the vesting period, at the end of each reporting period
during the vesting period, the Company shall recognise relevant costs or expenses and the
corresponding increase in liability for services received in the reporting period at the fair value of the
liability borne, based on the best available estimate of the number expected to vest.
Equity-settled share-based payment
(i) For equity-settled share-based payment transaction in which services are received, if the equity
instrument granted vest immediately, the Company shall recognise relevant costs or expenses at the
fair value of the equity instruments at grant date and the corresponding increase in capital reserve.
(ii) If the equity instrument do not vest until services during the vesting period are completed or
performance conditions are satisfied , at the end of each reporting period during the vesting period,
the Company shall recognise relevant costs or expenses and the corresponding increase in capital
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
reserve for services received in the reporting period at the fair value of the equity instruments at
grant date, based on the best available estimate of the number of equity instruments expected to vest.
(e) Accounting for modification of share-based payment programs
When the Company modifies terms and conditions of the share-based payment program, if the
modification increases the fair value of the equity instruments granted, the increased amount should
be recognised for service received accordingly; if the quantity granted of the equity instruments is
increased, the increased amount should be recgonised for service received accordingly as well. If the
modification reduces the total fair value of the share-based payment arrangement, or the terms are
changed in such a way that the arrangement is no longer for the benefit of the employee, the entity is
still required to account for the services received as consideration for the equity instruments granted
as if that modification had not occurred unless a part or all of the equity instruments are cancelled.
(f) Accounting for termination of share-based payment programs
If a grant of equity instruments is cancelled or settled during the vesting period (other than a grant
cancelled by forfeiture when the vesting conditions are not satisfied), the Company shall:
(i) Account for the cancellation or settlement as an acceleration of vesting, and therefore recognise
immediately the amount that otherwise would have been recognised for services received over the
remainder of the vesting period.
(ii)Account for any payment made to the employee on the cancellation or settlement of the grant as
the repurchase of an equity interest, and recognize any excess of the payment over the fair value of
the equity instruments measured at the repurchase date as an expense.
If the Company repurchases vested equity instruments, the payment made to the employee shall be
accounted for as a deduction from equity, and recognize any excess of the payment over the fair
value of the equity instruments measured at the repurchase date shall be recognised in current profit
or loss.
(a) General Principle
Revenue is defined as the gross inflow of economic benefits arising in the course of the ordinary
activities of the Company when those inflows result in the increases in shareholders’ equity, other
than increases relating to contributions from shareholders.
The Company shall recognise revenue when it satisfies a performance obligation in the contract as
the customer obtains control of a good or service. Control of a good or service refers to the ability to
direct the use of, and obtain substantially all of the remaining economic benefits from, the good or
service.
When the contract has two or more obligation performances, the Company shall allocate the
transaction price to each performance obligation in proportion to a relative stand-alone selling price
at contract inception of the promised good or service underlying each performance obligation in the
contract and recognize revenue based on the transaction price allocated to each performance
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
obligation.
The transaction price is the amount of consideration to which the Company expects to be entitled in
exchange for transferring promised goods or services to a customer, excluding amounts collected on
behalf of third parties. When determining the transaction price of the contract, if the contract includes
a variable consideration, the Company shall determine the best estimate of the variable consideration
based on the expected value or the most likely amount and include in the transaction price only to the
extent that it is highly probable that a significant reversal in the amount of cumulative revenue
recognised will not occur when the uncertainty associated with the variable consideration is
subsequently resolved. If the contract contains a significant financing component, the Company shall
determine the transaction price at an amount that reflects the price that a customer would have paid
for the promised goods or services if the customer had paid cash for those goods or services when (or
as) they transfer to the customer. The difference between the transaction price and the promised
consideration shall be amortised using the effective interest method within the contract period. The
Company need not consider the effects of a significant financing component if the period between
when the Company transfers control of a good or service to a customer and when the customer pays
for that good or service will be one year or less.
The Company satisfies a performance obligation over time, if one of the following criteria is met;
otherwise a performance obligation is satisfied at a point in time:
(i) the customer simultaneously receives and consumes the benefits provided by the Company’s
performance as the Company performs;
(ii) the Company’s performance creates or enhances an asset (for example, work in progress) that the
customer controls as the asset is created or enhanced;
(iii) the Company’s performance does not create an asset with an alternative use to the Company and
the Company has an enforceable right to payment for performance completed to date.
For each performance obligation satisfied over time, the Company shall recognise revenue over time
by measuring the progress towards complete satisfaction of that performance obligation, unless those
progress cannot be reasonably measured. The Company measures the progress of a performance
obligation for the service rendered using input methods (or output methods). In some circumstances,
the Company cannot be able to reasonably measure the progress of a performance obligation, but the
Company expects to recover the costs incurred in satisfying the performance obligation. In those
circumstances, the Company shall recognise revenue only to the extent of the costs incurred until
such time that it can reasonably measure the progress of the performance obligation.
The Company shall recognise revenue at the point in which a customer obtains control of a promised
good or service if a performance obligation is satisfied at a point in time. To determine the point in
time at which a customer obtains control of a promised good or service, the Company shall consider
indicators of the transfer of control, which include, but are not limited to, the followings:
(i) The Company has a present right to payment for the good or service – a customer is presently
obliged to pay for the good or service;
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(ii) The Company has transferred legal title of an asset to a customer - the customer has legal title to
the asset;
(iii) The Company has transferred physical possession of an asset to a customer - the customer has
physical possession of the asset;
(iv) The Company has transferred the significant risks and rewards of ownership of the asset to a
customer - the customer has the significant risks and rewards of ownership of the asset;
(v) The customer has accepted the asset.
Sale with a right of return
For sales with a right of return, when the customer obtains the control of a product, the Company
shall recognise revenue for the transferred products in the amount of consideration to which the
Company expects to be entitled and a refund liability at the amounts receivable for which the
Company does not expect to be entitled; meanwhile, an asset shall be recognised as receivables on
the cost of return measured at the former carrying amount of the product expected to be returned less
any expected costs to recover those products (including potential decreases in the value to the entity
of returned products), and the net amount of the former carrying amount of the product when
transferred to the customer less above mentioned cost shall be recorded into the cost of sales. At the
end of each reporting period, the Company shall re-assess the expectations about the sales return and
remeasure above mentioned assets and liabilities.
Warranties
In accordance with the contract, the law or other requirements, the Company provides a warranty in
connection with the sale of a product or construction of a project. For warranties which provide a
customer with assurance that the related product will function as the parties intended because it
complies with agreed-upon specifications, the Company shall treat it in accordance with "
Accounting Standards for Business Enterprise No. 13-Contingencies". If a warranty, or a part of a
warranty, provides a customer with a service in addition to the assurance that the product complies
with agreed-upon specifications, the Company shall treat it as a performance obligation, and allocate
the transaction price to the warranty based on the relative proportion to the stand-alone selling price
of the product and the service, and recognise revenue when the customer obtains the control of the
service. In assessing whether a warranty provides a customer with a service in addition to the
assurance that the product complies with agreed-upon specifications, the Company shall consider
factors such as: whether the warranty is required by law; the length of the warranty coverage period
and the nature of the tasks that the Company promises to perform.
Principal versus agent considerations
The Company determines whether it is a principal or an agent of the transaction on the basis of
whether it has control over the goods or services before they are transferred to customers. If the
Company obtains the control of the specified goods or services from another party and then transfers
the goods or services to the customer, the Company is therefore a principal, and recognises revenue
in the gross amount of consideration to which it expects to be entitled in exchange for the specified
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
goods or services transferred. Otherwise, the Company is an agent, and shall recognise revenue in the
amount of any fee or commission to which it expects to be entitled in exchange for arranging for the
specified goods or services to be provided by another party. The fee or commission might be the net
amount of received or receivable consideration that the Company retains after paying the other party
the consideration received in exchange for the goods or services to be provided by that party or
determined based on the specified commission amount or proportion.
Consideration payable to a customer
The Company shall account for consideration payable to a customer as a reduction of the transaction
price unless the payment to the customer is in exchange for a distinct good or service that the
customer transfers to the Company. The reduction of revenue shall be recognised when (or as) the
later of either of the following events occurs: the Company recognises revenue for the transfer of the
related goods or services to the customer; and the Company pays or promises to pay the
consideration.
Customers’ unexercised rights
Upon receipt of a prepayment for a good or service from a customer, the Company shall recognise a
contract liability in the amount of the prepayment and recognise revenue when it satisfies its
performance obligation. If the prepayment to the Company is non-refundable and the customer may
not exercise part or all of its contractual rights, and the Company expects to be entitled to a breakage
amount related to those unexercised rights of the customer, the Company shall recognise the
expected breakage amount as revenue in proportion to the pattern of rights exercised by the customer;
otherwise, the Company shall recognise the remaining balance of above mentioned liability as
revenue when the likelihood of the customer exercising its remaining rights becomes remote.
Contract modifications
When the construction contract modifications exist between the Company and the customer:
(i) The Company shall account for a contract modification as a separate contract if the
modification results in the addition of promised construction services that are distinct and increase of
the price of the contract, and the price of the contract increases by an amount of consideration that
reflects the Company’s stand-alone selling prices of the additional promised construction services;
(ii) If the contract modification is not accounted for as a separate contract in accordance with
above mentioned circumstance, and the remaining construction services are distinct from the
construction services transferred on or before the date of the contract modification, the Company
shall account for the contract modification as if it were a termination of the existing contract and the
creation of a new contract with the combination of the remaining performance obligations of the
existing contract and the contract modification.
(iii) If the contract modification is not accounted for as a separate contract in accordance with above
mentioned circumstance, and the remaining construction services cannot be distinct from the
construction services transferred on or before the date of the contract modification, the Company
shall account for the contract modification as if it were a part of the existing contract and the effect
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
that the contract modification has on the transaction price, and on the entity’s measure of progress
towards complete satisfaction of the performance obligation, is recognised as an adjustment to
revenue at the date of the contract modification.
(b) Specific Method
Revenue recognition methods of the Company are as follows:
(i) Sales of watch
Sale of watch belongs to fulfilling performance obligations at a point of time.
A. Online sales
Revenue shall be recognized at the point that the goods are dispatched, the customer confirmed
received the goods, and the platform has collected the payment
B. Offline sales
Revenue shall be recognized at the point when the goods are delivered and payment by customer is
collected.
Revenue shall be recognized at the point when the products are delivered to and accepted by the
customer, the payment has been received or the right to collect payment is obtained, and related
economic benefits are probable to flow into the entity
C. Consignment sale
Under consignment sales arrangements, revenue is recognized upon receiving the sales list from the
consignee, confirming that control of goods has been transferred to the customer.
D. Sale of consigned goods from others
Under sale arrangement of consigned goods from others, the Company recognizes revenue using the
net method when external consigned products are delivered to customers and control of the goods
has been transferred to the buyer
(ii) Precision manufacturing
Precision manufacturing business belongs to fulfilling performance obligations at a point of time.
Revenue from domestic sales shall be recognized when the goods are delivered and the economic
benefit associated with the goods is probable to flow into the Company. Revenue from export shall
be recognized when the following criteria is satisfied: the Company declared the good at custom;
obtained bill of lading; the right of collecting payment is obtained and its probable that the economic
benefit associated with the goods flows into the Company.
(iii) Property leasing
For the accounting treatment of the Company as a lessor, please refer to Note 3.30.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(a) Recognition of government grants
A government grant shall not be recgonised until there is reasonable assurance that:
(i) The Company will comply with the conditions attaching to them; and
(ii) The grants will be received.
(b) Measurement of government grants
Monetary grants from the government shall be measured at amount received or receivable, and non-
monetary grants from the government shall be measured at their fair value or at a nominal value of
RMB 1.00 when reliable fair value is not available.
(c) Accounting for government grants
(i) Government grants related to assets
Government grants pertinent to assets mean the government grants that are obtained by the Company
used for purchase or construction, or forming the long-term assets by other ways. Government grants
pertinent to assets shall be recognised as deferred income, and should be recognised in profit or loss
on a systematic basis over the useful lives of the relevant assets. Grants measured at their nominal
value shall be directly recognised in profit or loss of the period when the grants are received. When
the relevant assets are sold, transferred, written off or damaged before the assets are terminated, the
remaining deferred income shall be transferred into profit or loss of the period of disposing relevant
assets.
(ii) Government grants related to income
Government grants other than related to assets are classified as government grants related to income.
Government grants related to income are accounted for in accordance with the following principles:
If the government grants related to income are used to compensate the enterprise’s relevant expenses
or losses in future periods, such government grants shall be recognised as deferred income and
included into profit or loss in the same period as the relevant expenses or losses are recognised;
If the government grants related to income are used to compensate the enterprise’s relevant expenses
or losses incurred, such government grants are directly recognised into current profit or loss.
For government grants comprised of part related to assets as well as part related to income, each part
is accounted for separately; if it is difficult to identify different part, the government grants are
accounted for as government grants related to income as a whole.
Government grants related to daily operation activities are recognised in other income in accordance
with the nature of the activities, and government grants irrelevant to daily operation activities are
recognised in non-operating income.
(iii) Loan interest subsidy
When loan interest subsidy is allocated to the bank, and the bank provides a loan at lower-market
rate of interest to the Company, the loan is recognised at the actual received amount, and the interest
expense is calculated based on the principal of the loan and the lower-market rate of interest.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
When loan interest subsidy is directly allocated to the Company, the subsidy shall be recognised as
offsetting the relevant borrowing cost.
(iv) Repayment of the government grants
Repayment of the government grants shall be recorded by increasing the carrying amount of the asset
if the book value of the asset has been written down, or reducing the balance of relevant deferred
income if deferred income balance exists, any excess will be recognised into current profit or loss; or
directly recognised into current profit or loss for other circumstances.
Temporary differences are differences between the carrying amount of an asset or liability in the
statement of financial position and its tax base at the balance sheet date. The Company recognise and
measure the effect of taxable temporary differences and deductible temporary differences on income
tax as deferred tax liabilities or deferred tax assets using liability method. Deferred tax assets and
deferred tax liabilities shall not be discounted.
(a) Recognition of deferred tax assets
Deferred tax assets should be recognised for deductible temporary differences, the carryforward of
unused tax losses and the carryforward of unused tax credits to the extent that it is probable that
taxable profit will be available against which the deductible temporary differences, the carryforward
of unused tax losses and the carryforward of unused tax credits can be utilised at the tax rates that are
expected to apply to the period when the asset is realised, unless the deferred tax asset arises from
the initial recognition of an asset or liability in a transaction that:
(i) Is not a business combination; and
(ii) At the time of the transaction, affects neither accounting profit nor taxable profit (tax loss)
However, a single transaction that meets both of the above two conditions and where the initially
recognized assets and liabilities give rise to equal amounts of taxable temporary differences and
deductible temporary differences is not eligible for the exemption from the requirement to initially
recognize deferred tax liabilities and deferred tax assets under this provision. For the taxable
temporary differences and deductible temporary differences arising from the initial recognition of the
assets and liabilities of such a transaction, the Company recognizes the corresponding deferred tax
liabilities and deferred tax assets separately at the time of the transaction.
The Company shall recognise a deferred tax asset for all deductible temporary differences arising
from investments in subsidiaries, associates and joint ventures, only to the extent that, it is probable
that:
(i) The temporary difference will reverse in the foreseeable future; and
(ii) Taxable profit will be available against which the deductible temporary difference can be utilised.
At the end of each reporting period, if there is sufficient evidence that it is probable that taxable
profit will be available against which the deductible temporary difference can be utilized, the
Company recognises a previously unrecognised deferred tax asset.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
The carrying amount of a deferred tax asset shall be reviewed at the end of each reporting period.
The Company shall reduce the carrying amount of a deferred tax asset to the extent that it is no
longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that
deferred tax asset to be utilised. Any such reduction shall be reversed to the extent that it becomes
probable that sufficient taxable profit will be available.
(b) Recognition of deferred tax liabilities
A deferred tax liability shall be recognised for all taxable temporary differences at the tax rate that
are expected to apply to the period when the liability is settled.
(i) No deferred tax liability shall be recognised for taxable temporary differences arising from:
? The initial recognition of goodwill; or
? The initial recognition of an asset or liability in a transaction which: is not a business
combination; and at the time of the transaction, affects neither accounting profit nor taxable
profit (tax loss)
(ii) An entity shall recognise a deferred tax liability for all taxable temporary differences associated
with investments in subsidiaries, associates, and joint ventures, except to the extent that both of the
following conditions are satisfied:
? The Company is able to control the timing of the reversal of the temporary difference; and
? It is probable that the temporary difference will not reverse in the foreseeable future.
(c) Recognition of deferred tax liabilities or assets involved in special transactions or events
(i) Deferred tax liabilities or assets related to business combination
For the taxable temporary difference or deductible temporary difference arising from a business
combination not under common control, a deferred tax liability or a deferred tax asset shall be
recognised, and simultaneously, goodwill recognised in the business combination shall be adjusted
based on relevant deferred tax expense (income).
(ii) Items directly recognised in equity
Current tax and deferred tax related to items that are recognised directly in equity shall be recognised
in equity. Such items include: other comprehensive income generated from fair value fluctuation of
other debt investments; an adjustment to the opening balance of retained earnings resulting from
either a change in accounting policy that is applied retrospectively or the correction of a prior period
(significant) error; amounts arising on initial recognition of the equity component of a compound
financial instrument that contains both liability and equity component.
(iii) Unused tax losses and unused tax credits
Unused tax losses and unused tax credits generated from daily operation of the Company itself
Deductible loss refers to the loss calculated and permitted according to the requirement of tax law
that can be offset against taxable income in future periods. The criteria for recognising deferred tax
assets arising from the carryforward of unused tax losses and tax credits are the same as the criteria
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
for recognising deferred tax assets arising from deductible temporary differences. The Company
recognises a deferred tax asset arising from unused tax losses or tax credits only to the extent that
there is convincing other evidence that sufficient taxable profit will be available against which the
unused tax losses or unused tax credits can be utilised by the Company. Income taxes in current
profit or loss shall be deducted as well.
Unused tax losses and unused tax credits arising from a business combination
Under a business combination, the acquiree’s deductible temporary differences which do not satisfy
the criteria at the acquisition date for recognition of deferred tax asset shall not be recognised. Within
at the acquisition date and the economic benefit of the acquiree’s deductible temporary differences at
the acquisition is expected to be realised, the Company shall recognise acquired deferred tax benefits
and reduce the carrying amount of any goodwill related to this acquisition. If goodwill is reduced to
zero, any remaining deferred tax benefits shall be recognised in profit or loss. All other acquired
deferred tax benefits realised shall be recognised in profit or loss.
(iv) Temporary difference generated in consolidation elimination
When preparing consolidated financial statements, if temporary difference between carrying value of
the assets and liabilities in the consolidated financial statements and their taxable bases is generated
from elimination of inter-company unrealized profit or loss, deferred tax assets or deferred tax
liabilities shall be recognised in the consolidated financial statements, and income taxes expense in
current profit or loss shall be adjusted as well except for deferred tax related to transactions or events
recognised directly in equity and business combination.
(v) Share-based payment settled by equity
If tax authority permits tax deduction that relates to share-based payment, during the period in which
the expenses are recognised according to the accounting standards, the Company estimates the tax
base in accordance with available information at the end of the accounting period and the temporary
difference arising from it. Deferred tax shall be recognised when criteria of recognition are satisfied.
If the amount of estimated future tax deduction exceeds the amount of the cumulative expenses
related to share-based payment recognised according to the accounting standards, the tax effect of the
excess amount shall be recognised directly in equity.
(d) Basis for deferred income tax assets and deferred income tax liabilities presented on a net
basis
The Company shall offset deferred tax assets and deferred tax liabilities if, and only if: (i) the
Company has a legally enforceable right to set off current tax assets against current tax liabilities;
and
(ii) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same
taxation authority on either:
? the same taxable entity; or
? different taxable entities which intend either to settle current tax liabilities and assets on a net
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
basis, or to realise the assets and settle the liabilities simultaneously, in each future period in
which significant amounts of deferred tax liabilities or assets are expected to be settled or
recovered.
(a) Identifying a lease
At inception of a contract, the Company shall assess whether the contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right to control the use of one or more
identified assets for a period of time in exchange for consideration. To assess whether a contract
conveys the right to control the use of an identified asset for a period of time, the Company shall
assess whether, throughout the period of use, the customer has the right to obtain substantially all of
the economic benefits from use of the identified asset and to direct the use of the identified asset.
(b) Identifying a separate lease component
When a contract includes more than one separate lease components, the Company shall separate
components of the contract and account for each lease component separately. The right to use an
underlying asset is a separate lease component if both conditions have been satisfied: (i) the lessee
can benefit from use of the underlying asset either on its own or together with other resources that
are readily available to the lessee; (ii) the underlying asset is neither highly dependent on, nor highly
interrelated with, the other underlying assets in the contract.
(c) The Company as a lessee
At the commencement date, the Company identifies the lease that has a lease term of 12 months or
less and does not contain a purchase option as a short-term lease. A lease qualifies as a lease of a
low-value asset if the nature of the asset is such that, when new, the asset is typically of low value. If
the Company subleases an asset, or expects to sublease an asset, the head lease does not qualify as a
lease of a low-value asset.
For all the short-term leases or leases for which the underlying asset is of low value, the Company
shall recognise the lease payments associated with those leases as cost of relevant asset or expenses
in current profit or loss on a straight-line basis over the lease term.
Except for the election of simple treatment as short-term lease or lease of a low-value asset as
mentioned above, at the commencement date, the Company shall recognise a right-of-use asset and a
lease liability.
(i) Right-of-use asset
A right-of-use asset is an asset that represents a lessee’s right to use an underlying asset for the lease
term.
At the commencement date, the Company shall initially measure the right-of-use asset at cost. The
cost of the right-of-use asset shall comprise:
? the amount of the initial measurement of the lease liability；
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
? any lease payments made at or before the commencement date, less any lease incentives
received;
? any initial direct costs incurred by the lessee; and
? an estimate of costs to be incurred by the lessee in dismantling and removing the underlying
asset, restoring the site on which it is located or restoring the underlying asset to the condition
required by the terms and conditions of the lease. The Company recognises and measures the
cost in accordance with the recognition criteria and measurement method for estimated liabilities,
details please refer to Notes 3.25. Those costs incurred to produce inventories shall be included
in the cost of inventories.
The right-of-use asset shall be depreciated according to the categories using straight‐line method. If
it is reasonably certain that the ownership of the underlying asset shall be transferred to the lessee by
the end of the lease term, the depreciation rate shall be determined based on the classification of the
right-of- use asset and estimated residual value rate from the commencement date to the end of the
useful life of the underlying asset. Otherwise, the depreciation rate shall be determined based on the
classification of the right-of-use asset from the commencement date to the earlier of the end of the
useful life of the right-of-use asset or the end of the lease term.
After the commencement date, the Company shall remeasure the lease liability based on the revised
present value of the lease payments and adjust the carrying amount of the right-of-use asset if there is
a change in the in-substance fixed payments, or change in the amounts expected to be payable under
a residual value guarantee, or change in an index or a rate used to determine lease payments, or
change in the assessment or exercising of an option to purchase the underlying asset, or an option to
extend or terminate the lease.
(d) The Company as a lessor
At the commencement date, the Company shall classify a lease as a finance lease if it transfers
substantially all the risks and rewards incidental to ownership of an underlying asset, otherwise it
shall be classified as an operating lease.
(i) Operating leases
The Company shall recognise lease payments from operating leases as income on a straight-line
basis over the term of the relevant lease and the initial direct costs incurred in obtaining an operating
lease shall be capitalised and recognised as an expense over the lease term on the same basis as the
lease income. The Company shall recognise the variable lease payments relating to the operating
lease but not included in the measurement of the lease receivables into current profit or loss when
incurred.
(ii) Finance leases
At the commencement date, the Company shall recognise the lease receivables at an account equal to
the net investment in the lease (the sum of the present value of the unguaranteed residual values and
the lease payment that are not received at the commencement date discounted at the interest rate
implicit in the lease) and derecognise the asset relating to the finance lease. The Company shall
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
recognise interest income using the interest rate implicit in the lease over the lease term.
The Company shall recognise the variable lease payments relating to the finance lease but not
included in the measurement of the net investment in the lease into current profit or loss when
incurred.
(e) Lease modifications
(i) A lease modification accounted for as a separate lease
The Company shall account for a modification to a lease as a separate lease, if both:
? the modification increases the scope of the lease by adding the right to use one or more
underlying assets; and
? the consideration for the lease increases by an amount commensurate with the stand-alone price
for the increase in scope.
(ii) A lease modification not accounted for as a separate lease
The Company as a lessee
At the effective date of the lease modification, the Company shall redetermine the lease term of the
modified lease and remeasure the lease liability by discounting the revised lease payments using a
revised discount rate. The revised discount rate is determined as the interest rate implicit in the lease
for the remainder of the lease term, if that rate can be readily determined, or the incremental
borrowing rate at the effective date of the modification, if the interest rate implicit in the lease cannot
be readily determined.
The Company shall account for the remeasurement of the lease liability by:
? decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination
of the lease for lease modifications that decrease the scope of the lease or shorten the lease term.
The Company shall recognise in profit or loss any gain or loss relating to the partial or full
termination of the lease.
? Making a corresponding adjustment to the carrying amount of the right-of-use asset for all other
lease modifications.
The Company as a lessor
The Company shall account for a modification to an operating lease as a new lease from the effective
date of the modification, considering any prepaid or accrued lease payments relating to the original
lease as part of the lease payments for the new lease.
For a modification to a finance lease that is not accounted for as a separate lease, the Company shall
account for the modification as follows:
? if the lease would have been classified as an operating lease had the modification been in effect
at the inception date, the Company shall account for the lease modification as a new lease from
the effective date of the modification and measure the carrying amount of the underlying asset as
the net investment in the lease immediately before the effective date of the lease modification;
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
? if the lease would have been classified as a finance lease had the modification been in effect at
the inception date, the Company shall account for the lease modification according to the
requirements in the modification or renegotiation of the contract.
(f) Sale and leaseback
The Company shall determine whether the transfer of an asset under the sale and leaseback
transaction is a sale of that asset according to the policies in Note 3.27.
(i) The Company as a seller (lessee)
If the transfer of the asset is not a sale, the Company shall continue to recognise the transferred asset
and shall recognise a financial liability equal to the transfer proceeds. It shall account for the
financial liability according to Note 3.11. If the transfer of the asset is a sale, the Company shall
measure the right-of-use asset arising from the leaseback at the proportion of the previous carrying
amount of the asset that relates to the right of use retained by the Company. Accordingly, the
Company shall recognise only the amount of any gain or loss that relates to the rights transferred to
the buyer-lessor.
(ii) The Company as a buyer (lessor)
If the transfer of the asset is not a sale, the Company shall not recognise the transferred asset and
shall recognise a financial asset equal to the transfer proceeds. It shall account for the financial asset
according to Note 3.11. If the transfer of the asset is a sale, the Company shall account for the
purchase of the asset applying applicable Accounting Standards of Business Enterprises, and for the
lease applying the lessor accounting requirements.
According to the relevant regulations, the Company accrues the safety production costs.
The safety production costs shall be recognised in the cost of the relevant products or current profit
or loss when makes the accrual, and included in the “special reserve” account simultaneously.
When the accrued safety production costs are used within the scope of the regulations, it shall be
treated as expense and directly deducted from the special reserve; if the fixed assets are capitalized,
the expenditure incurred shall be firstly collectively recorded in “construction in progress” and
recognised as fixed asset when the safety project has been completed for its intended use. At the
same time, the cost that capitalized as the fixed assets shall be deducted from the special reserve and
the accumulated depreciation with the same amount shall be recognised. The fixed assets shall not be
depreciated in subsequent reporting period.
(a) If the Company reduces its registered capital through repurchase of the Company’s share
according to the approval required in relevant laws and regulations, the share capital shall be reduced
at the par value of the shares deregistered, the difference between the consideration paid for
repurchase (including the transaction cost) and the par value of the shares shall adjust the owner’s
equity. Any excess of the total par value shall offset the capital reserve (share premium), surplus
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
reserve and retained earnings in turn. If the consideration paid is less than the total par value, the
difference shall increase the capital reserve (share premium).
(b) Before being deregistered or transfered, shares repurchased by the Company shall be treated as
treasury stock and all expenditures of the repurchase shall be recognised as the cost of treasury stock.
(c) Any excess of the income generated from transferring the treasury stock over their cost shall
increase the capital reserve (share premium), and any less shall offset the capital reserve (share
premium), surplus reserve and retained earnings in turn.
In the equity incentive plan, the Company shall grant restricted shares to the motivated target, and
the motivated object first subscribes for the stock. If the subsequent unlocking conditions specified in
the equity incentive plan are not met, the Company repurchases the stock at the price agreed in
advance. If the restricted shares issued to employees are subject to the procedures for capital increase
such as registration in accordance with relevant regulations, at grant date, the Company shall
recognise the share capital and capital reserve (share premium) based on the received subscription
fees from the employees; treasury stocks and other payables shall be recognised based on the
repurchase obligation.
(a) Changes in accounting polices
The Company has no significant changes in accounting polices for the reporting period..
(b) Significant changes in accounting estimates
The Company has no significant changes in accounting estimates for the reporting period.
Categories of tax Basis of tax assessment Tax rate
Output tax is calculated at rates of 5%, 6%,
Value added tax (VAT) Taxable revenue
deducting input tax as per regulations, the
net tax payable is determined.
Taxable Price and Sales
Consumption tax Volume of High-End Watch 20%
Sales Revenue
Urban maintenance and
Turnover tax payable 5%, 7%
construction tax
Property tax 1.2%, 12%
cost of property
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Tax rates of income tax of different subsidiaries are stated as below:
Name of Taxpayer Rate of Income Tax
FIYTA Precision Technology Co., Ltd. 25%
Shenzhen HARMONY World Watch Center Co., Ltd. (i) 25%
FIYTA Sales Co., Ltd. (i) 25%
Shenzhen FIYTA Precision Technology Co., Ltd. (ii) 15%
Shenzhen FIYTA Technology Development Co., Ltd. (ii) 15%
HARMONY World Watch Center(Hainan) Co., Ltd. (v) 20%
Shenzhen Xunhang Precision Technology Co., Ltd. 25%
Emile Choureit Timing (Shenzhen) Ltd. 25%
Liaoning Hengdarui Commercial & Trade Co., Ltd. 25%
Temporal (Shenzhen) Co., Ltd. 25%
Shenzhen Harmony E-commerce Co., Ltd. (v) 20%
FIYTA Hong Kong (iii) 16.5%
Montres Chouriet SA (iv) 30%
Notes:
(i) According to the relevant provisions of the Notice of the State Administration of Taxation on
Issuing the Interim Measures for the Administration of Collection of Enterprise Income Tax on the
Basis of Consolidation of Trans-regional Business Operations, the head office of the Company and
its branches shall be governed by the administrative measures for enterprise income tax, namely
namely “centralized calculation, level-by-level administration, pre-payment at the locality,
consolidated settlement and payment, and transfer to treasury”. 50% of the prepayment shall be
apportioned among the branches and 50% shall be apportioned by the head office;
(ii) the companies enjoy the corporate income tax rate reduction for “key high-tech enterprises
supported by the state”;
(iii) the company is incorporated in Hong Kong and is subject to Hong Kong Profits Tax at a rate of
(iv) the company is incorporated in Switzerland and is subject to the local tax rate, which the
comprehensive tax rate for the current year is 30%;
(v) the companies qualify as small low-profit enterprises and are subject to corporate income tax at a
rate of 20%.
In accordance with the Corporate Income Tax Law of the People's Republic of China, high-tech
enterprises that are key areas of state support are subject to a reduced corporate income tax rate of
enterprise in 2024 with a certificate number of GR202444200965, valid for three years, and is
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
subject to a corporate income tax rate of 15% from 2024 to 2026. The subsidiary, Shenzhen FIYTA
Technology Development Co., Ltd., was certified as a high-tech enterprise in 2025 with a certificate
number of GR202544201002, valid for three years, and is subject to a corporate income tax rate of
In accordance with the relevant provisions of the Announcement of the Ministry of Finance and the
State Administration of Taxation on Preferential Income Tax Policies for Small and Micro
Enterprises and Individual Businesses (Cai Shui [2023] No. 6), small low-profit enterprises are
allowed to include only 25% of their income in the taxable income base and are then subject to a
In accordance with the Notice of the Ministry of Finance and the State Administration of Taxation on
Extending the Loss Carryforward Period for High-Tech Enterprises and Technology-Based Small
and Medium-Sized Enterprises (Cai Shui [2018] No. 76), effective from January 1, 2018, any
unutilized losses incurred during the five accounting years prior to obtaining high-tech enterprise
status may be carried forward to subsequent years. The maximum carryforward period has been
extended from five years to ten years.
In accordance with the Announcement of the Ministry of Finance and the State Administration of Taxation on
Further Improving the Pre-Tax Additional Deduction Policy for R&D Expenses (Cai Shui [2023] No. 7), for
R&D expenses actually incurred by enterprises that do not result in the creation of an intangible asset
(and are therefore recorded in the current profit or loss), an additional 100% deduction may be
claimed for tax purposes, on top of the statutory deduction, starting from January 1, 2023. If the
R&D activities result in the creation of an intangible asset, beginning January 1, 2023, 200% of the
intangible asset’s cost may be amortized for tax purposes.
Since 2019, Hong Kong has implemented a two-tiered profits tax regime. Under this system, the first
HKD 2 million of profits is taxed at a rate of 8.25%, and any profits exceeding that threshold
continue to be taxed at 16.5%.
Items 31 December 2025 31 December 2024
Cash on hand 34,041.22 76,344.01
Cash in bank 75,156,082.51 18,205,968.96
Other monetary funds 3,489,741.96 2,055,640.10
Funds in finance company 552,559,173.96 498,616,224.42
Total 631,239,039.65 518,954,177.49
Including：The total amount
deposited overseas
Notes:
(i) Funds in finance company primarily refer to amounts held at AVIC Finance Co., Ltd..
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(ii) As of 31 December 2025, the Company has no pledged or frozen funds, nor any amounts with
potential recovery risk.
(a) Notes receivable by category
Items Provision
Book Carrying Book Provision Carrying
for bad
Balance amount Balance for bad debt amount
debt
Bank acceptance bills 3,665,974.22 3,665,974.22 9,184,912.30 9,184,912.30
Commercial
acceptance bills
Total 14,140,935.62 523,748.07
(b) Notes receivable by bad debt provision method
Category Book balance Provision for bad debt
Provision Carrying amount
Amount Proportion (%) Amount
ratio (%)
Provision for bad debt
recognised individually
Provision for bad debt
recognised by groups
Including: Group 2 3,665,974.22 25.92 3,665,974.22
Group 1 10,474,961.40 74.08 523,748.07 5.00 9,951,213.33
Total 14,140,935.62 100.00 523,748.07 3.70 13,617,187.55
(Continued)
Book balance Provision for bad debt
Category Carrying
Provisio
Proportion amount
Amount Amount n ratio
(%)
(%)
Provision for bad debt recognised
individually
Provision for bad debt recognised
by groups
Including: Group 2 9,184,912.30 29.93 9,184,912.30
Group 1 21,501,777.16 70.07 1,075,088.86 5.00 20,426,688.30
Total 30,686,689.46 100.00 1,075,088.86 3.50 29,611,600.60
For details of recognition criteria and explanation for provision of bad debt by groups, please refer to
Notes 3.11.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(c) Changes of provision for bad debt during the reporting period
Changes during the reporting period 31
Category 31 December 2024 Recovery or Elimination or December
Provision others 2025
reversal write-off
Provision for bad debt
recognised individually
Provision for bad debt
recognised by groups
Including: Group 2 1,075,088.86 -551,340.79 523,748.07
Group 1 1,075,088.86 -551,340.79 523,748.07
Total 1,075,088.86 -551,340.79 523,748.07
(a) Accounts receivable by aging
Aging 31 December 2025 31 December 2024
Within one year 260,899,769.98 271,349,349.06
Over 3 years 9,567,138.57 20,138,406.23
Subtotal 274,556,500.34 293,662,774.44
Less: provision for bad debt 24,687,959.40 33,509,940.01
Total 249,868,540.94 260,152,834.43
(b) Accounts receivable by bad debt provision method
Category Book balance Provision for bad debt
Carrying
Proportion Provision amount
Amount Amount
(%) ratio (%)
Provision for bad debt
recognised individually 15,766,982.49 5.74 15,433,987.23 97.89 332,995.26
Provision for bad debt
recognised by groups 258,789,517.85 94.26 9,253,972.17 3.58 249,535,545.68
Including:Group1 258,789,517.85 94.26 9,253,972.17 3.58 249,535,545.68
Total 274,556,500.34 100.00 24,687,959.40 8.99 249,868,540.94
(Continued)
Category Book balance Provision for bad debt
Carrying
Proportion Provision ratio amount
Amount Amount
(%) (%)
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Category Book balance Provision for bad debt
Carrying
Proportion Provision ratio amount
Amount Amount
(%) (%)
Provision for bad debt
recognised individually 25,816,016.35 8.79 24,222,124.31 93.83 1,593,892.04
Provision for bad debt
recognised by groups 267,846,758.09 91.21 9,287,815.70 3.47 258,558,942.39
Including:Group1 267,846,758.09 91.21 9,287,815.70 3.47 258,558,942.39
Total 293,662,774.44 100.00 33,509,940.01 11.41 260,152,834.43
Detailed explanation of provision for bad debt:
(i) As at 31 December 2025, accounts receivable with bad debt provision recognised individually
Name Provision for Provision ratio
Book balance Reason for provision
bad debt (%)
Existence of disputes, poor
Other customers 15,766,982.49 15,433,987.23 97.89
management, ect
(ii) As at 31 December 2025, accounts receivable with bad debt provision recognised by group 1
Aging Accounts Provision for Provision Accounts Provision for Provision
receivable bad debt ratio (%) receivable bad debt ratio (%)
Within one year 257,859,630.24 8,916,306.48 3.46 266,494,339.01 8,150,327.80 3.06
Over 2 years 271,863.26 271,863.26 100.00 1,113,606.66 1,113,606.66 100.00
Total 258,789,517.85 9,253,972.17 3.58 267,846,758.09 9,287,815.70 3.47
(c) Changes of provision for bad debt during the reporting period
Changes during the reporting period
Category Recovery or Elimination
reversal or write-off
Provision for bad
debt recognised 23,148,792.25 4,728,732.75 3,699,262.84 43,862.15 24,222,124.31
individually
Provision for bad
debt recognised 11,242,194.21 -1,945,944.73 -8,433.78 9,287,815.70
by groups
Including:Group1 11,242,194.21 -1,945,944.73 -8,433.78 9,287,815.70
Total 34,390,986.46 2,782,788.02 3,699,262.84 35,428.37 33,509,940.01
(d) Details of accounts receivable written off during the current period
Items Amount
Accountsreceivablewrittenoff 9,701,377.67
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(e) Top five closing balances by entity
Percentage
of Total
Entity Balance as at 31 Age of Other
Nature of Amount Provision for Bad Debts
name December 2025 Amount Receivables
at Period
End (%)
Within
No. 1 Others 2,650,000.00 4.56 2,650,000.00
Deposit and guarantee Within
No. 2 1,998,936.00 3.44 99,946.79
receivable 1 year
Deposit and guarantee Within
No. 3 1,937,848.05 3.33 115,232.33
receivable 1 year
Deposit and guarantee Within
No. 4 1,859,688.00 3.20 92,984.40
receivable 1 year
Deposit and guarantee Within
No. 5 1,594,477.50 2.74 79,723.88
receivable 1 year
(a) Advances to suppliers by aging
Aging
Amount Proportion (%) Amount Proportion (%)
Within one year 4,912,759.05 100.00 3,858,053.60 100.00
(b) Top five closing balances by entity
Balance as at 31 Proportion of the balance to the
Entity name
December 2025 total advances to suppliers (%)
Total of the top five advances to suppliers
at the end of the period
(a) Other receivables by aging
Aging 31 December 2025 31 December 2024
Within one year 54,498,112.58 59,521,049.33
Over 3 years 1,446,064.90 1,278,954.90
Subtotal 58,106,697.07 61,321,812.40
Less: provision for bad debt 7,066,543.88 4,339,461.13
Total 51,040,153.19 56,982,351.27
(b) Other receivables by nature
Nature 31 December 2025 31 December 2024
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Nature 31 December 2025 31 December 2024
Deposit and guarantee receivable 49,507,243.06 52,384,967.00
Employee advance payments 941,768.76 1,282,327.49
Others 7,657,685.25 7,654,517.91
Subtotal 58,106,697.07 61,321,812.40
Less: provision for bad debt 7,066,543.88 4,339,461.13
Total 51,040,153.19 56,982,351.27
(c) Other receivables by bad debt provision method
A. As at 31 December 2025, provision for bad debt recognised based on three stages model
Stages Book balance Provision for bad debt Carrying amount
Stage 1 53,691,455.91 2,651,302.72 51,040,153.19
Stage 2
Stage 3 4,415,241.16 4,415,241.16
Total 58,106,697.07 7,066,543.88 51,040,153.19
As at 31 December 2025, provision for bad debt at stage 1:
Provision ratio Provision for Carrying
Category Book balance
(%) bad debt amount
Provision for bad debt
recognised individually
Provision for bad debt
recognised by groups
Including: Group 1 48,443,814.53 5.06 2,453,308.64 45,990,505.89
Group 2 908,012.96 908,012.96
Group 3 4,339,628.42 4.56 197,994.08 4,141,634.34
Total 53,691,455.91 4.94 2,651,302.72 51,040,153.19
As at 31 December 2025, provision for bad debt at stage 3:
Provision for Carrying
Category Book balance Provision ratio (%)
bad debt amount
Provision for bad debt
recognised individually
B. As at 31 December 2024, provision for bad debt recognised based on three stages model
Stages Book balance Provision for bad debt Carrying amount
Stage 1 59,786,824.63 2,872,168.83 56,914,655.80
Stage 2
Stage 3 1,534,987.77 1,467,292.30 67,695.47
Total 61,321,812.40 4,339,461.13 56,982,351.27
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
As at 31 December 2024, provision for bad debt at stage 1:
Provision ratio Provision for Carrying
Category Book balance
(%) bad debt amount
Provision for bad debt
recognised individually
Provision for bad debt
recognised by groups
Including: Group 1 51,515,791.06 5.10 2,629,814.29 48,885,976.77
Group 2 1,282,327.49 1,282,327.49
Group 3 6,988,706.08 3.47 242,354.54 6,746,351.54
Total 59,786,824.63 4.80 2,872,168.83 56,914,655.80
As at 31 December 2024, provision for bad debt at stage 3:
Provision for Carrying
Category Book balance Provision ratio (%)
bad debt amount
Provision for bad debt
recognised individually
Basis of provision for bad debt during the reporting period:
For details of recognition criteria and explanation for provision of bad debt by groups, please refer to
Notes 3.11
(d) Changes of provision for bad debt during the reporting period
Changes during the reporting period
Category Recovery Elimination
or reversal or write-off
Provision for bad
debt recognised 1,467,292.30 2,960,644.33 12,695.47 4,415,241.16
individually
Provision for bad
debt recognised by 2,872,168.83 -221,458.72 592.61 2,651,302.72
groups
Total 4,339,461.13 2,739,185.61 12,695.47 592.61 7,066,543.88
(e) Details of other receivables written off during the current period
Items Amount
Accounts receivable actually written off 9,701,377.67
(f) Top five closing balances by entity
Balance as at 31 Proportion of the balance to
Entity name Provision for bad debt
December 2025 the total other receivables (%)
Total of the top five
other receivables at the 10,040,949.55 17.28 3,037,887.40
end of the period.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(a) Inventories by category
Items Provision for Provision for
Book balance Carrying amount Book balance Carrying amount
impairment impairment
Raw
materials
Work in
process
Goods in
stock
Total 1,830,966,506.16 102,984,101.50 1,727,982,404.66 2,057,873,383.71 73,386,413.97 1,984,486,969.74
(b) Provision for impairment
Increase during the Decrease during the
Items
Provision Others Others
elimination
Raw
materials
Work in
process
Goods in
stock
Total 73,386,413.97 53,936,941.10 24,178,528.73 160,724.84 102,984,101.50
Items 31 December 2025 31 December 2024
Reclassification from debit side
balance of VAT payable
Term Deposit 29,408,855.46
Advance Tax Payment 5,517,052.75 4,402,072.04
Others 13,690,557.92 18,430,363.63
Total 66,510,872.63 98,007,925.22
Changes during the reporting period
Investment
Investees income/(losses) Changes
recognised in other
investme investme comprehensi
under equity equity
nt nt ve income
method
I. Associates
Shanghai Watch
Co., Ltd.
(Continued)
Investees Changes during the reporting period 31 December Provision for
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Declaration of cash
dividends or Provision for
Others
distribution of impairment
profit
II. Associates
Shanghai Watch
Co., Ltd.
(a) Investment properties accounted for using cost model
Items Building and plants
Initial cost:
Balance as at 31 December 2024 544,545,292.87
Increase during the reporting period 31,364,878.67
(i) Transfer from fixed assets 31,364,878.67
Decrease during the reporting period 20,051,952.11
(i) Transfer to fixed assets 20,051,952.11
Balance as at 31 December 2025 555,858,219.43
Accumulated depreciation and amortisation:
Balance as at 31 December 2024 243,542,928.46
Increase during the reporting period 15,299,764.79
(i) Provision 12,747,661.27
(ii) Transfer from fixed assets 2,552,103.52
Decrease during the reporting period 11,255,054.19
(i) Transfer to fixed assets 11,255,054.19
Balance as at 31 December 2025 247,587,639.06
Provision for impairment:
Carrying amount:
Balance as at 31 December 2025 308,270,580.37
Balance as at 31 December 2024 301,002,364.41
(a)Details of fixed assets
Buildings and Machinery Electrical Other
Items Vehicles Total
constructions equipment equipment equipment
Initialcost:
Balance as at 31 December 2024 515,518,210.64 131,660,591.28 12,031,744.02 51,743,615.12 43,815,743.01 754,769,904.07
Increase during the reporting period 25,735,214.41 9,976,509.89 6,095.44 5,123,507.07 1,819,719.87 42,661,046.68
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Buildings and Machinery Electrical Other
Items Vehicles Total
constructions equipment equipment equipment
(i)Acquisition 7,421,347.01 6,095.44 5,042,075.03 1,585,918.17 14,549,793.21
(ii)Transfer from investment properties 20,051,952.11 20,051,952.11
(iii)Exchange differences on translating foreign
operations
Decrease during the reporting period 31,439,555.87 662,604.92 2,690,812.87 3,977,462.46 3,915,311.32 42,685,747.44
(i) Disposal 631,760.47 2,690,812.87 3,977,139.78 3,915,311.32 11,215,024.44
(ii) Transfer to investment properties 31,364,878.67 31,364,878.67
(iii ) Exchange differences on translating
foreign operations
Balance as at 31 December 2025 509,813,869.18 140,974,496.25 9,347,026.59 52,889,659.73 41,720,151.56 754,745,203.31
Accumulated depreciation:
Balance as at 31 December 2024 195,960,430.03 90,553,556.06 11,195,032.63 40,399,800.29 39,092,940.65 377,201,759.66
Increase during the reporting period 31,272,155.78 9,484,929.29 565,561.39 3,434,613.56 1,286,779.15 46,044,039.17
(i) Provision 16,034,245.03 6,995,125.56 565,561.39 3,357,907.33 1,053,059.37 28,005,898.68
(ii)Transfer from investment properties 11,255,054.19 11,255,054.19
(iii) Exchange differences on translating foreign
operations
Decrease during the reporting period 2,620,144.63 608,340.70 2,550,307.45 2,803,574.54 3,272,226.35 11,854,593.67
(i) Disposal 579,038.47 2,550,307.45 2,803,267.99 3,272,226.35 9,204,840.26
(ii) Transfer to investment properties 2,552,103.52 2,552,103.52
(iii ) Exchange differences on translating
foreign operations
Balance as at 31 December 2025 224,612,441.18 99,430,144.65 9,210,286.57 41,030,839.31 37,107,493.45 411,391,205.16
Provision for impairment:
Carrying amount:
Balance as at 31 December 2025 285,201,428.00 41,544,351.60 136,740.02 11,858,820.42 4,612,658.11 343,353,998.15
Balance as at 31 December 2024 319,557,780.61 41,107,035.22 836,711.39 11,343,814.83 4,722,802.36 377,568,144.41
(b) Fixed assets without certificate of title
Items Carrying amount Reason
Buildings and constructions 158,506.40 Defective property rights
Items Buildings and constructions
Initial cost:
Balance as at 31 December 2024 216,731,879.49
Increase during the reporting period 84,382,199.14
(i) New leasing 84,382,199.14
Decrease during the reporting period 111,855,194.44
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items Buildings and constructions
(i) Disposal 111,855,194.44
Balance as at 31 December 2025 189,258,884.19
Accumulated depreciation:
Balance as at 31 December 2024 118,293,903.08
Increase during the reporting period 102,678,424.23
(i) Provision 102,674,310.42
(ii) Exchange differences on translating foreign
operations
Decrease during the reporting period 104,504,535.18
(i) Disposal 104,504,535.18
Balance as at 31 December 2025 116,467,792.13
Provision for impairment:
Carrying amount:
Balance as at 31 December 2025 72,791,092.06
Balance as at 31 December 2024 98,437,976.41
Right to use the
Items Land use rights Software Total
trademark
Initial cost:
Balance as at 31 December
Increase during the
reporting period
(i) Acquisition 3,159,520.88 3,159,520.88
(ii) Exchange differences on
translating foreign 24,661.22 24,661.22
operations
Decrease during the
reporting period
(i)Disposal
Balance as at 31 December
Accumulated depreciation:
Balance as at 31 December
Increase during the
reporting period
(i) Provision 733,553.29 2,278,135.68 19,676.25 3,031,365.22
Decrease during the
reporting period
Balance as at 31 December
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Right to use the
Items Land use rights Software Total
trademark
Provision for impairment:
Carrying amount:
Balance as at 31 December
Balance as at 31 December
Decrease during the reporting
Items 31 December 2025
Amortisation Other decrease
Renovation
expenses and
counter 107,493,262.36 35,661,123.29 64,812,808.67 2,109,876.49 76,231,700.49
fabrication
expenses
Others 2,712,060.93 16,612,375.45 6,381,867.37 12,942,569.01
Total 110,205,323.29 52,273,498.74 71,194,676.04 2,109,876.49 89,174,269.50
(a) Deferred tax assets before offsetting
Items Deductible
Deductible temporary Deferred tax
Deferred tax assets temporary
differences assets
differences
Provision for
impairment loss
Unrealised
intragroup profit
Deductible losses 203,464,885.90 45,249,255.22 150,789,689.25 35,315,775.40
Equity Incentive 7,958,442.71 1,839,229.47
Lease liabilities 74,789,934.31 18,697,483.59 98,553,370.15 24,638,342.52
Others 5,030,696.54 1,248,681.80 11,064,124.31 2,766,031.08
Total 480,361,046.21 111,439,499.18 442,817,247.92 105,879,079.87
(b) Deferred tax liabilities before offsetting
Items Taxable temporary Deferred tax Taxable temporary Deferred tax
difference liabilities difference liabilities
One-off deduction of
fixed asset before 27,169,935.68 4,075,490.34 27,444,135.67 4,116,620.35
Corporate income tax
Right-of-use asset 72,643,762.42 18,160,940.61 98,388,890.53 24,597,222.63
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items Taxable temporary Deferred tax Taxable temporary Deferred tax
difference liabilities difference liabilities
Total 99,813,698.10 22,236,430.95 125,833,026.20 28,713,842.98
(c) Net balance of deferred tax liabilities and deferred tax assets after offsetting
Net balance after Net balance after
Offset amount at 31 Offset amount at 31
Items offsetting at 31 offsetting at 31
December 2025 December 2024
December 2025 December 2024
Deferred tax
assets
Deferred tax
liabilities
(d) Unrecognized deferred tax assets
Items 31 December 2025 31 December 2024
Deductible temporary differences 11,868,777.70 3,466,155.48
Deductible losses 42,305,096.05
Total 11,868,777.70 45,771,251.53
(e) Deductible losses not recognised as deferred tax assets will expire in the following periods:
Year 31 December 2025 31 December 2024
Items Provision Provision
Book Book Carrying
for Carrying amount for
balance balance amount
impairment impairment
Prepayment
of long- 5,757,347.81 5,757,347.81 3,792,253.84 3,792,253.84
term assets
Items 31 December 2025 31 December 2024
Credit loans 120,000,000.00
Bill discounting 3,957,187.86
Accrued interest payable 130,566.65
Total 124,087,754.51
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items 31 December 2025 31 December 2024
Payables for goods 94,791,440.02 114,881,141.96
Payables for project 651,779.61
Total 94,791,440.02 115,532,921.57
Items 31 December 2025 31 December 2024
Rental received in advance 11,368,005.63 11,783,796.49
Items 31 December 2025 31 December 2024
Advances for goods 16,450,934.50 12,605,722.95
(a) Details of employee benefits payable
Items
Short-term employee
benefits
Post-employment benefits-
defined contribution plans
Termination benefits 5,040,229.42 19,323,749.66 19,516,006.50 4,847,972.58
Total 92,260,153.14 517,179,751.14 529,380,686.46 80,059,217.82
(b) Short-term employee benefits
Items
Salaries, bonuses,
allowances and subsidies
Employee benefits 74,715.46 8,000,962.96 8,070,016.54 5,661.88
Social insurance 240,049.63 20,588,686.72 20,479,063.60 349,672.75
Including: Health
insurance
Injury insurance 78.32 1,168,695.23 1,168,695.23 78.32
Birth insurance 848,035.56 848,035.56
Housing accumulation
fund
Labour union funds and
employee education 866,070.23 5,415,167.15 5,647,976.70 633,260.68
funds
Total 79,250,553.06 450,414,443.54 462,096,745.60 67,568,251.00
(c) Defined contribution plans
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items
Post-employment
benefits:
insurance
insurance
Total 7,969,370.66 47,441,557.94 47,767,934.36 7,642,994.24
Items 31 December 2025 31 December 2024
Value added tax (VAT) 24,404,139.24 33,699,458.80
Corporate income tax 12,878,070.87 11,535,771.24
Individual income tax 969,315.24 994,923.84
Urban maintenance and construction tax 453,029.07 1,359,840.26
Educational surcharge 316,181.96 972,536.24
Others 1,177,277.66 1,252,620.97
Total 40,198,014.04 49,815,151.35
(a) Other payables by category
Items 31 December 2025 31 December 2024
Dividend payable 2,785,293.14
Other payables 75,141,232.27 101,853,190.67
Total 75,141,232.27 104,638,483.81
(b) Dividends payable
Items 31 December 2025 31 December 2024
Dividends on ordinary shares 2,785,293.14
(c) Other payables
Items 31 December 2025 31 December 2024
Deposit, security deposit 28,070,048.35 31,563,500.48
Repurchase liability for restricted shares 12,815,556.81
Decoration expenses 3,524,465.97 3,978,759.28
Accrued expenses and others 43,546,717.95 53,495,374.10
Total 75,141,232.27 101,853,190.67
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items 31 December 2025 31 December 2024
Lease liabilities due within one year 57,044,492.54 63,538,231.06
Items 31 December 2025 31 December 2024
Tax payable-reclassification from credit
balance of VAT Payable
Items 31 December 2025 31 December 2024
Lease payments 76,851,971.25 101,263,377.23
Less: Unrealised finance expenses 1,915,088.40 2,659,854.13
Subtotal 74,936,882.85 98,603,523.10
Less: lease liabilities due within one year 57,044,492.54 63,538,231.06
Total 17,892,390.31 35,065,292.04
Changes during the reporting period (+,-)
Items New Bonus Capitalisation
issues issues of reserves
Number of total shares 405,764,007.00 405,764,007.00
Items
Share premium 912,742,221.49 8,861,512.48 921,603,733.97
Other capital reserves 23,597,282.11 9,591,764.14 14,005,517.97
Total 936,339,503.60 8,861,512.48 9,591,764.14 935,609,251.94
Notes:
(i) According to the resolution approved by the Company's Board of Directors and the General
Meeting of Shareholders on the Proposal for the Achievement of the Conditions for Lifting of
Restrictions in the Third Restriction Lifting Period under the 2018 A- Share Restricted Stock
Incentive Plan (Phase II), the Company completed the procedures for lifting restrictions on 20.4742
million A- share restricted shares that satisfied the conditions for lifting restrictions during the year
aforementioned incentive recipients was transferred from “Other capital reserves” to “Share
premium”.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(ii) The difference between the current year’s income tax pre- tax deduction amount and the relevant
costs and expenses recognized during the waiting period, arising from the difference between the fair
value at the time of unlocking the restricted shares and the grant price at the time of grant, resulted in
an income tax effect, which accordingly decreased “Other capital reserves” by RMB 730,251.66.
Increase during the Decrease during the 31 December
Items 31 December 2024
reporting period reporting period 2025
Share Repurchase for
Capital Reduction
Restricted Stock
Payment
Total 78,645,532.23 65,829,975.42 12,815,556.81
Note:
(i) As stated in Note 5.27.1 to these financial statements, for the restricted shares for which the
repurchase obligations are no longer required as the unlocking conditions have been met, the
corresponding repurchase obligations were derecognized, thereby reducing “Restricted Share
Payment” by RMB 12,815,556.81.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Changes during the reporting period
Less: Items
Less: Items
previously
previously
Items recognized in other Attributable to 31 December 2025
comprehensive owners of the
before tax comprehensive tax controlling
income being Company
income being expenses interest
reclassified to
reclassified to
current profit or loss
retained earnings
(a)Items will not be
reclassified to profit or loss
(b)Items will be
reclassified to profit or loss
Including: Exchange
differences on translating 15,686,794.62 7,978,422.75 7,978,422.75 23,665,217.37
foreign operations
Total 15,686,794.62 7,978,422.75 7,978,422.75 23,665,217.37
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items
Safety production costs 4,340,162.76 223,177.64 602,170.53 3,961,169.87
Items
Statutory surplus reserves 213,025,507.50 213,025,507.50
Others 61,984,894.00 61,984,894.00
Total 275,010,401.50 275,010,401.50
As of 31 December 2025, the Company's cumulative surplus reserve has reached 50% of its
registered capital, and therefore, no further extraction will be made during current period.
Items 2025 2024
Balance as at the end of last period before
adjustments
Adjustments for the opening balance (increase
/(decrease))
Balance as at the beginning of the reporting period
after adjustments
Add: net profit attributable to owners of the parent
company for the reporting period
Less: Declaration of ordinary share dividends 162,305,602.80 162,345,682.81
Balance as at the end of the reporting period 1,692,530,114.77 1,767,517,887.94
Items
Revenue Costs of sales Revenue Costs of sales
Principal activities 3,490,320,310.17 2,257,153,747.65 3,928,845,057.63 2,475,847,402.83
Other activities 18,167,601.23 4,977,286.11 11,685,876.44 350,531.60
Total 3,508,487,911.40 2,262,131,033.76 3,940,530,934.07 2,476,197,934.43
Principal activities by category
Items
Revenue Costs of sales Revenue Costs of sales
Watch Brand Business 570,402,572.45 186,950,718.29 721,623,074.27 236,520,324.15
Watch Retail Services 2,662,429,068.19 1,901,757,507.69 2,934,683,059.47 2,080,768,868.69
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items
Revenue Costs of sales Revenue Costs of sales
Precision Technology
Business
Leasing Business 113,496,227.38 41,900,699.32 138,069,112.39 43,245,383.91
Others 18,167,601.23 4,977,286.11 11,685,876.44 350,531.60
Total 3,508,487,911.40 2,262,131,033.76 3,940,530,934.07 2,476,197,934.43
Items 2025 2024
Urban maintenance and construction tax 10,668,474.38 10,496,860.12
Educational surcharge 7,526,202.94 7,450,711.80
Property tax 7,523,043.74 7,672,948.68
Stamp duty 2,302,823.44 2,638,753.37
Others 3,015,326.28 3,217,860.83
Total 31,035,870.78 31,477,134.80
Items 2025 2024
Employee Compensation 286,763,707.41 350,108,585.64
Department store expense and rental 143,592,007.22 141,659,138.17
Advertising, Exhibition, and
Marketing Expenses
Depreciation and amortization 168,982,088.02 187,804,323.98
Utilities and property management
expenses
Packaging expenses 6,429,475.59 8,732,106.49
Office Expenses 4,172,341.49 5,299,644.22
Transportation Expenses 4,133,136.45 5,326,216.64
Travel Expenses 3,261,011.00 6,511,503.28
Business Entertainment Expenses 1,379,425.70 3,354,425.04
Others 11,868,035.89 8,470,993.04
Total 781,062,383.74 882,777,806.63
Items 2025 2024
Employee Compensation 139,683,676.61 141,263,743.91
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items 2025 2024
Depreciation and amortization 20,859,869.65 21,858,646.45
Office Expenses 2,697,248.05 3,237,040.25
Intermediary Agents fees 2,043,134.60 2,072,802.52
Travel Expenses 1,551,295.98 3,444,726.00
Vehicle and Transportation Expenses 1,067,770.55 1,184,673.02
Utilities, Property Management, and
Rental Fees
Business Entertainment Expenses 401,441.02 854,422.68
Telecommunication expenses 206,918.14 329,077.20
Others 7,963,641.22 7,982,781.89
Total 177,357,796.51 183,277,930.17
Items 2025 2024
Employee Compensation 54,014,603.82 38,055,759.66
Sample and Material Costs 1,205,956.77 1,635,339.74
Depreciation and Amortization 5,099,464.51 4,783,178.84
Technical Cooperation Fees 2,836,648.30 3,704,971.76
Others 6,050,008.96 7,820,750.18
Total 69,206,682.36 56,000,000.18
Items 2025 2024
Interest expenses 4,883,063.98 10,697,706.12
Less: Interest income 4,192,623.18 4,925,264.78
Net interest expenses 690,440.80 5,772,441.34
Net foreign exchange losses -717,041.20 1,151,055.95
Bank charges and others 11,422,485.63 11,001,374.05
Total 11,395,885.23 17,924,871.34
Items 2025 2024
Including: Government grant related to deferred
income
Government grant directly recognised in current 3,071,440.45 4,527,755.07
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items 2025 2024
profit or loss
recognised in other income
Including: Charges of withholding individual
income tax
Additional Deduction for Input VAT 2,178,780.74 1,534,404.24
Total 5,722,898.08 7,492,642.33
Items 2025 2024
Investment income from long-term equity investments
-4,324,269.84 -955,570.46
under equity method
Interest income from term deposit 437,789.65 524,315.57
Total -3,886,480.19 -431,254.89
Items 2025 2024
Bad debt of notes receivable 551,340.79 -659,008.68
Bad debt of accounts receivable -887,347.19 916,474.82
Bad debt of other receivables -2,726,490.14 9,019.82
Total -3,062,496.54 266,485.96
Items 2025 2024
Impairment of inventories -53,936,941.10 -19,289,865.31
Items 2025 2024
Gains/(losses) from disposal of fixed
-279,011.13 2,795,633.25
assets
Gains/(losses) from disposal of
-954,954.96 -427,816.65
Right-of-use assets
Total -1,233,966.09 2,367,816.60
Recognised in current non-
Items 2025 2024
recurring profit or loss
No payables required 125,708.82 1,217,512.88 125,708.82
Compensation income 1,797,356.05 1,916,585.22 1,797,356.05
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Recognised in current non-
Items 2025 2024
recurring profit or loss
Others 199,641.35 489,407.21 199,641.35
Total 2,122,706.22 3,623,505.31 2,122,706.22
Recognised in current non-
Items 2025 2024
recurring profit or loss
Donations 115,080.00 243,626.35 115,080.00
Fine and penalty for late payment 1,330,662.34 143,706.74 1,330,662.34
Payment for breach of agreement 90,666.43 279,932.96 90,666.43
Others 383,732.91 121,651.88 383,732.91
Total 1,920,141.68 788,917.93 1,920,141.68
(a) Details of income tax expenses
Items 2025 2024
Current tax expenses 45,203,294.78 67,911,869.72
Deferred tax expenses -12,417,286.69 -2,146,386.12
Total 32,786,008.09 65,765,483.60
(b) Reconciliation of accounting profit and income tax expenses
Items 2025 2024
Profit before tax 120,103,837.72 286,115,668.59
Income tax expense at the statutory /applicable tax
rate
Effect of different tax rate of subsidiaries -1,147,998.02 -2,574,951.45
Adjustments of impact from prior period income
tax
Effect of income that is exempt from taxation 1,081,067.46 238,892.62
Effect of non-deductible costs, expenses or losses 1,900,231.98 1,160,439.96
Effect of previously unrecognised deductible
-163,165.84 -172,422.26
losses recognised as deferred tax assets
Effect of deductible temporary differences and
deductible losses not recognised as deferred tax
assets
R&D expenses plus deduction -6,198,287.18 -4,855,738.14
Others
Income tax expenses 32,786,008.09 65,765,483.60
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
For details of the other comprehensive income and related tax effect, transfer to profit or loss
and adjustment of other comprehensive income, please refer to Note 5.29 Other
Comprehensive Income.
(a) Cash relating to operating activities
(i)Other cash received relating to operating activities
Items 2025 2024
Security deposit 8,493,431.78 9,790,425.68
Government grants 3,543,246.91 4,922,856.45
Promotion expenses 6,268,215.19 12,351,768.55
Interest income 4,192,623.18 4,925,264.78
Return of petty cash 2,021,594.33 3,851,281.76
Others 12,736,500.64 13,783,494.72
Total 37,255,612.03 49,625,091.94
(ii) Other cash payments relating to operating activities
Items 2025 2024
Security deposit 9,573,911.71 8,953,141.58
Period expenses and others 301,031,362.89 321,439,889.86
Total 310,605,274.60 330,393,031.44
(b) Cash relating to investing activities
(i)Other cash received relating to investing activities
Items 2025 2024
Withdrawal of time deposits 185,690,609.60 201,839,677.57
(ii) Other cash payments relating to investing activities
Items 2025 2024
Purchase of time deposits 156,380,120.10 231,179,882.49
(c) Cash relating to financing activities
(i)Other cash payments relating to financing activities
Items 2025 2024
Payment for principal and interest
of lease liabilities
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items 2025 2024
Payment for share buyback 794,690.45
Total 103,960,778.17 116,757,093.91
(ii) Changes in liabilities arising from financing activities
Increase in the current period Decrease in the current period
Items Changes in Changes in Changes in Changes in
cash non-cash cash non-cash
Short-term
borrowings
Dividend
payables
Non-current
liabilities
maturing within
one year
Lease liabilities 35,065,292.04 80,294,137.92 97,467,039.65 17,892,390.31
Total 225,476,570.75 140,000,000.00 340,066,780.37 530,370,553.83 100,235,914.44 74,936,882.85
(a) Supplementary information to the statement of cash flows
Supplementary information 2025 2024
(i) Adjustments of net profit to cash flows from
operating activities:
Net profit 87,317,829.63 220,350,184.99
Add: Provisions for impairment of assets 53,936,941.10 19,289,865.31
Impairment Loss of Credit 3,062,496.54 -266,485.96
Depreciation of fixed assets, Investment
Properties ,oil and gas asset and productive 40,707,711.30 42,123,553.82
biological assets
Depreciation of right-of-use assets 102,674,310.42 107,301,685.07
Amortisation of intangible assets 3,031,365.22 3,623,865.56
Amortisation of long-term deferred expenses 71,194,676.04 72,228,172.82
Losses /(gains) on disposal of fixed assets,
intangible assets and other long-term assets
Losses /(gains) on scrapping of fixed assets
Losses /(gains) on changes in fair value
Finance costs /(income) 4,883,063.98 10,697,706.12
Investment losses /(income) 3,886,480.19 431,254.89
Decreases /(increases) in deferred tax assets -8,570,285.57 -1,928,006.85
Increases /(decreases) in deferred tax liabilities -3,467,545.77 -218,379.27
Decreases /(increases) in inventories 226,906,877.55 114,705,609.37
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Supplementary information 2025 2024
Decreases /(increases) in operating receivables 37,261,097.03 55,993,621.50
Increases /(decreases) in operating payables -81,807,703.33 -106,350,875.18
Others -378,992.89 1,117,004.70
Net cash flows from operating activities 541,872,287.53 536,730,960.29
(ii)Significant activities not involving cash receipts
and payments:
Conversion of debt into capital
Convertible corporate bonds maturing within one
year
Assets under leases(other than leases under
simplified method)
(iii)Net increases in cash and cash equivalents:
Cash at the end of the reporting period 631,239,039.65 518,954,177.49
Less: Cash at the beginning of the reporting period 518,954,177.49 504,629,153.71
Add: Cash equivalents at the end of the reporting
period
Less: Cash equivalents at the beginning of the
reporting period
Net increase in cash and cash equivalents 112,284,862.16 14,325,023.78
(b) The components of cash and cash equivalents
Items 31 December 2025 31 December 2024
(i) Cash 631,239,039.65 518,954,177.49
Including: Cash on hand 34,041.22 76,344.01
Cash in bank available for immediate use 627,225,875.81 516,822,193.38
Other monetary funds available for
immediate use
(ii) Cash equivalents
Including: Bond investments maturing within three
months
(iii) Cash and cash equivalents at the end of the
reporting period
Including Restricted cash and cash equivalents for the
Company and its subsidiaries
(c) Presented as cash and cash equivalents despite restrictions in scope of application
Items 2025 2024 Reason
The Company's subsidiary, FIYTA Hong Kong, and
its subsidiary, Montres Chouriet SA, hold funds in
Cash in bank 7,127,169.50 6,150,258.49 accounts located overseas. These funds are subject
to restrictions on repatriation, but this does not
affect their daily use.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(a) Foreign currency monetary items at 31 December 2025:
Carrying amount at
Items Exchange rate Carrying amount at RMB
foreign currency
Monetary funds 20,882,200.49
Including: USD 554,469.45 7.0288 3,897,254.87
EUR 238,872.98 8.2355 1,967,238.43
HKD 9,531,520.15 0.9032 8,608,869.00
CHF 724,080.69 8.8510 6,408,838.19
Accounts receivable 6,230,672.18
Including: USD 663,545.07 7.0288 4,663,925.59
EUR 62.71 8.2355 516.45
HKD 1,482,135.05 0.9032 1,338,664.38
CHF 25,710.74 8.8510 227,565.76
Other receivables 274,146.65
Including: HKD 25,605.60 0.9032 23,126.98
CHF 28,360.60 8.8510 251,019.67
Accounts payable 141,631.35
Including: HKD 156,810.62 0.9032 141,631.35
Other payables 878,305.57
Including: HKD 856,802.22 0.9032 773,863.77
CHF 11,800.00 8.8510 104,441.80
(b) Overseas business entity
Please refer the Note 3.4, for the details of the main operating locations and functional
currencies of significant overseas operating entities .
(a) The Company as a lessee
Items 2025
Expenses for short-term lease under simplified method 6,106,487.48
Expenses for lease of low value asset (except for short-term lease) under
simplified method
Interest expense of lease liabilities 3,992,813.82
Variable lease payments not included in lease liabilities recognised in
current profit or loss
Income from subleasing the right-of-use assets
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items 2025
Cash outflows related to leases 193,886,636.81
Profit or loss in sale and leaseback transaction
(b) The Company as a lessor
(i) Operating lease
A. Lease income
Items 2025
Lease income 113,496,227.38
Including: income related to variable lease payments not included in lease
receivables
Items 2025 2024
Employee Compensation 54,014,603.82 38,055,759.66
Sample and Material Costs 1,205,956.77 1,635,339.74
Depreciation and Amortization 5,099,464.51 4,783,178.84
Technical Cooperation Fees 2,836,648.30 3,704,971.76
Others 6,050,008.96 7,820,750.18
Total 69,206,682.36 56,000,000.18
Including：Expensed R&D 69,206,682.36 56,000,000.18
expenditures
Capitalized R&D
expenditures
(a) Composition of corporate group
Percentage of equity
Nature of interests by the
Name of subsidiary Principal place Registered Ways of acquisition
business Company (%)
of business Address Direct Indirect
Shenzhen HARMONY
World Watch Center Commerce 100.00 Incorporated or
Shenzhen Shenzhen
Co., Ltd. investment
FIYTA Sales Co., Ltd. Commerce 100.00 Incorporated or
Shenzhen Shenzhen
investment
Shenzhen FIYTA
Precision Technology Manufacturing 99.44 0.56 Incorporated or
Shenzhen Shenzhen
Co., Ltd. investment
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Percentage of equity
Nature of interests by the
Name of subsidiary Principal place Registered Ways of acquisition
business Company (%)
of business Address Direct Indirect
Shenzhen FIYTA
Technology Manufacturing 100.00 Incorporated or
Shenzhen Shenzhen
Development Co., Ltd. investment
HARMONY World
Watch Center(Hainan) Commerce 100.00 Incorporated or
Sanya Sanya
Co., Ltd. investment
Shenzhen Xunhang
Precision Technology Manufacturing 100.00 Incorporated or
Shenzhen Shenzhen
Co., Ltd. investment
Emile Choureit Timing Incorporated or
Shenzhen Shenzhen Commerce 100.00
(Shenzhen) Ltd. investment
Liaoning Hengdarui Business
Commercial & Trade Shenyang Shenyang Commerce 100.00 combination under
Co., Ltd. common control
Temporal (Shenzhen) Incorporated or
Shenzhen Shenzhen Commerce 100.00
Co., Ltd. investment
Shenzhen Harmony E- Incorporated or
Shenzhen Shenzhen Commerce 100.00
commerce Co., Ltd. investment
FIYTA (Hong Kong) Incorporated or
Hong Kong Hong Kong Commerce 100.00
Limited investment
Business
Montres Chouriet SA combination not
Switzerland Switzerland Manufacturing 100.00
under common
control
(a) Insignificant associates
Proportion of equity
Company name Principal place Registered Nature of interests by the Measurement
address business methods
of business Company (%)
Direct Indirect
Shanghai Watch Co.,
Shanghai Shanghai Commerce 25% Equity method
Ltd.
(a) Main financial information of the insignificant associates
Items
Shanghai Watch Co., Ltd.
Aggregate amount of the following items calculated
at the proportion of shareholding ratio
—Net profit/(loss)
—Other comprehensive income -4,470,479.98 -955,570.46
—Total comprehensive income
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items presented in income
statement
Other income 3,071,440.45 5,480,540.76
Risks related to the financial instruments of the Company arise from the recognition of
various financial assets and financial liabilities during its operation, including credit risk,
liquidity risk and market risk.
Management of the Company is responsible for determining risk management objectives and
policies related to financial instruments. Operational management is responsible for the daily
risk management through functional departments (e.g. credit management department of the
Company reviews each credit sale). Internal audit department is responsible for the daily
supervision of implementation of the risk management policies and procedures, and report
their findings to the audit committee in a timely manner.
Overall risk management objective of the Company is to establish risk management policies
to minimize the risks without unduly affecting the competitiveness and resilience of the
Company.
Credit risk is the risk of one party of the financial instrument face to a financial loss because
the other party of the financial instrument fails to fulfill its obligation. The credit risk of the
Company is related to cash and equivalent, notes receivable, accounts receivables, other
receivables and long-term receivables. Credit risk of these financial assets is derived from the
counterparty’s breach of contract. The maximum risk exposure is equal to the carrying
amount of these financial instruments.
Cash and cash equivalent of the Company has lower credit risk, as they are mainly deposited
in such financial institutions as commercial bank, of which the Company thinks with higher
reputation and financial position.
For notes receivable, accounts receivable, accounts receivable financing and other receivables,
the Company establishes related policies to control their credit risk exposure. The Company
assesses credit capability of its customers and determines their credit terms based on their
financial position, possibility of the guarantee from third party, credit record and other factors
(such as current market status, etc.). The Company monitors its customers’ credit record
periodically, and for those customers with poor credit record, the Company will take measures
such as written call, shortening or cancelling their credit terms so as to ensure the overall
credit risk of the Company is controllable.
(i) Determination of significant increases in credit risk
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
The Company assesses at each reporting date as to whether the credit risk on financial
instruments has increased significantly since initial recognition. When the Company
determines whether the credit risk has increased significantly since initial recognition, it
considers based on reasonable and supportable information that is available without undue
cost or effort, including quantitative and qualitative analysis of historical information, external
credit ratings and forward-looking information. The Company determines the changes in the
risk of a default occurring over the expected life of the financial instrument through
comparing the risk of a default occurring on the financial instrument as at the reporting date
with the risk of a default occurring on the financial instrument as at the date of initial
recognition based on individual financial instrument or a group of financial instruments with
the similar credit risk characteristics.
When met one or more of the following quantitative or qualitative criteria, the Company
determines that the credit risk on financial instruments has increased significantly: the
quantitative criteria applied mainly because as at the reporting date, the increase in the
probability of default occurring over the lifetime is more than a certain percentage since the
initial recognition; the qualitative criteria applied if the debtor has adverse changes in business
and economic conditions, early warning list of customer, and etc.
(ii) Definition of credit-impaired financial assets
The criteria adopted by the Company for determination of credit impairment are consistent
with internal credit risk management objectives of relevant financial instruments in
considering both quantitative and qualitative indicators.
When the Company assesses whether the debtor has incurred the credit impairment, the main
factors considered are as following: Significant financial difficulty of the issuer or the
borrower; a breach of contract, e.g., default or past-due event; a lender having granted a
concession to the borrower for economic or contractual reasons relating to the borrower’s
financial difficulty that the lender would not otherwise consider; the probability that the
borrower will enter bankruptcy or other financial re-organisation; the disappearance of an
active market for the financial asset because of financial difficulties of the issuer or the
borrower; the purchase or origination of a financial asset at a deep discount that reflects the
incurred credit losses.
(iii) The parameter of expected credit loss measurement
The company measures impairment provision for different assets with the expected credit loss
of 12-month or the lifetime based on whether there has been a significant increase in credit
risk or credit impairment has occurred. The key parameters for expected credit loss
measurement include default probability, default loss rate and default risk exposure. The
Company sets up the model of default probability, default loss rate and default risk exposure
in considering the quantitative analysis of historical statistics (such as counterparties’ ratings,
guarantee method and collateral type, repayment method, etc.) and forward-looking
information.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Relevant definitions are as following:
Default probability refers to the probability of the debtor will fail to discharge the repayment
obligation over the next 12 months or the entire remaining lifetime;
Default loss rate refers to the Company's expectation of the loss degree of default risk
exposure. The default loss rate varies depending on the type of counterparty, recourse method
and priority, and the collateral. The default loss rate is the percentage of the risk exposure loss
when default has occurred and it is calculated over the next 12 months or the entire lifetime;
The default risk exposure refers to the amount that the company should be repaid when
default has occurred in the next 12 months or the entire lifetime. Both the assessment of
significant increase in credit risk of forward-looking information and the calculation of
expected credit losses involve forward-looking information. Through historical data analysis,
the Company identifies key economic indicators that have impact on the credit risk and
expected credit losses for each business.
The maximum exposure to credit risk of the Company is the carrying amount of each
financial asset in the statement of financial position. The Company does not provide any other
guarantees that may expose the Company to credit risk.
For the accounts receivable of the Company, the amount of top 5 clients represents 26.91% of
the total (31 December 2024: 22.77%).
Liquidity risk is the risk of shortage of funds when fulfilling the obligation of settlement by
delivering cash or other financial assets. The Company is responsible for the capital
management of all of its subsidiaries, including short-term investment of cash surplus and
dealing with forecasted cash demand by raising loans. The Company’s policy is to monitor
the demand for short-term and long-term floating capital and whether the requirement of loan
contracts is satisfied so as to ensure to maintain adequate cash and cash equivalents.
As at 31 December 2025, the maturity profile of the Company’s financial liabilities is as
follows:
Unit: RMB 10,000
Items
Within 1 year 1-2 years 2-3 years Over 3 years
Short-term loans
Accounts payable 9,479.14
Other payables 7,514.12
Non-current liabilities
maturing within one year
Lease liabilities 1,416.11 373.13
Total 22,697.71 1,416.11 373.13
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(Continued)
Items
Within 1 year 1-2 years 2-3 years Over 3 years
Short-term loans 12,408.78
Accounts payable 11,553.29
Other payables 10,463.85
Non-current liabilities
maturing within one year
Lease liabilities 2,851.41 655.12
Total 40,779.74 2,851.41 655.12
(a) Foreign currency risk
Except for the operations of the Company’s subsidiaries located in Hong Kong and foreign
countries are denominated and settled in HKD, USD, BPD, RMB and SGD, other main
operations of the Company are settled in RMB.
Except that the Company’s subsidiary in Hong Kong uses HKD as settlement currency and
sub-subsidiary in Swiss used CHF as settlement currency, the principal places of operations of
the Company are located in China and the major businesses are settled in RMB. However, the
Company’s recognized foreign currency assets and liabilities as well as the foreign currency
transactions in the future (the functional currencies of foreign assets and liabilities as well as
the transactions are mainly HKD and CHF) remain exposed to exchange rate risk.
(i) Please refer to Note 5.50 Foreign Currency Monetary Items, for the details of the main
foreign currency risk exposures of the Company’s foreign currency assets and liabilities as
at 31 December 2025.
(ii) Sensitivity analysis
As at 31 December 2025, if RMB appreciates or depreciates 5% against USD, while all other
risk variables stay unchanged, net profit in current year of the Company will increase or
decrease by RMB 131,840 (31 December 2024: RMB 394,100).
(b) Interest rate risk
Interest rate risk of the Company primarily arises from its long-term interest-bearing debts,
such as long-term loans and bonds payables, etc. Financial liabilities with floating interest rate
make the Company subject to cash flow interest rate risk, and financial liabilities with fixed
interest rate make the Company subject to fair value interest rate risk. The Company
determines the relative proportion of the fixed interest contracts and floating interest contracts
based on the current market environment.
Finance department of the Company’s headquarter monitors interest rate of the group
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
continuously. Increase of the interest rate will result in the increase of the cost of new interest-
bearing debts and the interest expense of the unpaid interest-bearing debts with floating rate,
and subsequently lead to significant negative impact on the financial performance of the
Company. The management makes adjustment in accordance with the update market
condition in a timely manner.
As at 31 December 2025, the company does not have any long-term interest-bearing debt.
As at 31 December 2025, the Company does not have financial instruments measured at fair
value.
Fair Value
Financial assets and financial liabilities not measured at fair value include: accounts
receivable, short-term borrowings, accounts payable, long-term borrowings due within one
year, and equity instrument investment that does not have public quotation in an active market
and its fair value cannot be measured reliably.
The difference between fair value and carrying amount of the above financial assets and
liabilities that not measured at fair value is insignificant.
Recognition of related parties: The Company has control or joint control of, or exercise
significant influence over another party; or the Company and another party are controlled or
jointly controlled by the same third party.
Percentage of
Voting rights in
Registered Nature of Registered equity interests
Name of the parent the Company
address the business capital in the Company
(%)
(%)
CATIC Shenzhen
Shenzhen Commercial 116,616.20 40.17 40.17
Holdings Limited
(a) Details of the parent company
CATIC Shenzhen Holdings Limited is a subsidiary that 100.00% held, indirectly, by AVIC
Innovation Holding Limited.
(b) Ultimate controlling party of the Company is AVIC Innovation Holding Limited.
Details of the subsidiaries please refer to Notes 7 INTERESTS IN OTHER ENTITIES.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Details of significant associates please refer to Notes 7 INTERESTS IN OTHER ENTITIES.
Name Relationship with the Company
Joint ventures of Aviation Industry Corporation of China and their
The associate of the ultimate
subsidiaries (hereinafter referred to as "Joint ventures of AVIC and their
controlling party
subsidiaries")
Aviation Industry Corporation of China and its subsidiaries
Under the same control
(hereinafter referred to as "AVIC and its subsidiaries")
The directors, managers, Chief Financial Officer (CFO), and Secretary
to the Board of Directors Key management personnel
(hereinafter referred to as "key management personnel").
(a) Purchases or sales of goods, rendering or receiving of services
Purchases of goods, receiving of services:
Related parties Nature of the transaction(s) 2025 2024
Mall Expenses and Goods
AVIC and its subsidiaries 14,257,917.38 16,376,625.49
Procurement
Joint ventures of AVIC and Mall Expenses and Property
their subsidiaries Management Fees
Sales of goods and rendering of services:
Related parties Nature of the transaction(s) 2025 2024
Sales of goods and rendering of
AVIC and its subsidiaries 33,254,801.38 46,244,991.78
services
Joint ventures of AVIC SSales of goods and Property
and their subsidiaries Management Fees
Shanghai Watch Co., Ltd. Sales of goods 3,695,244.27
(b) Leases
The Company as lessor:
The lessee Type of assets 2025 2024
Joint ventures of AVIC and
Buildings 45,714.32 1,666,400.02
their subsidiaries
AVIC and its subsidiaries Buildings 281,999.98 1,637,357.56
The Company as lessee:
Type of Variable lease Increase in
The lessor Lease payment Interest expense of
assets payments not included right-of-use
for current period lease liabilities
in lease liabilities assets
Joint
ventures of Buildings 21,750.50 350,896.02 5,099.96
AVIC and
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Type of Variable lease Increase in
The lessor Lease payment Interest expense of
assets payments not included right-of-use
for current period lease liabilities
in lease liabilities assets
their
subsidiaries
AVIC and
its Buildings 129,523.85 5,108.57 44,363.60
subsidiaries
(Continued)
Type of Variable lease Increase in
The lessor Lease payment Interest expense of
assets payments not included right-of-use
for current period lease liabilities
in lease liabilities assets
Joint
ventures of
AVIC and Buildings 2,692.68 485,331.20 11,649.16 -100,148.57
their
subsidiaries
AVIC and
its Buildings 162,868.56 1,894.34 -157,702.74
subsidiaries
(c) Key management personnel compensation
Items 2025 2024
Key management personnel
compensation
(d) Other related party transactions
The deposit balance of our company held at AVIC Finance Company as at 31 December 2025
amounted to RMB 552,559,173.96, of which the deposit interest received during the year
totaled RMB 1,963,880.34.
(a) Receivables
Items Related parties Bad debt Bad debt
Book balance Book balance
provision provision
Notes
AVIC and its subsidiaries 200,546.78 508,273.49
receivable
Accounts
AVIC and its subsidiaries 5,142,670.67 530,714.66 2,894,425.51 281,416.75
receivable
Other
AVIC and its subsidiaries 867,917.00 43,395.85 924,947.00 47,070.35
receivables
Other Joint ventures of AVIC
receivables and their subsidiaries
(b) Payables
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items Related parties 31 December 2025 31 December 2024
Other payables AVIC and its subsidiaries 358,280.00
Joint ventures of AVIC and
Other payables 892,941.08 1,066,456.79
their subsidiaries
Accounts payable AVIC and its subsidiaries 37,471.91
Receipts in advance AVIC and its subsidiaries 11,250.00 7,500.00
Grant in the Exercise in the Failure in the
Unlocking in the current period
Grant object category current period current period current period
Qty Amount Qty Amount Qty Amount Qty Amount
Some Directors,
Senior Management
& Core Backbone
Staff
Method of determining fair value of equity
Close price of share on grant date
instrument on grant date
Evidence to determine the number of exercisable Term of employee service, status of target
equity instrument completion, and personal performance assessment
Reasons for significant difference between current
Nil
period estimation and prior period estimation
Accumulated amount charged to capital reserve for
equity settled share-based payment
As of the balance sheet date, the significant external commitments of the Company include
lease contracts that have been signed and are in progress or are about to be executed, along
with their financial impacts. For detailed information, please refer to Note 5.25 Lease
Liabilities and Note 5.51 Leases.
Except for the commitments mentioned above, as of 31 December 2025, the Company has no
other significant commitments that need to be disclosed.
As at 31 December 2025, the Company has no significant contingencies need to be disclosed.
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
In accordance with the resolutions at the 14th Meeting of the 11th Board
The proposed profit or of Directors held on 12 March 2026, the Company will distribute cash
dividend distribution refers to dividends of RMB 1.20 (tax included) per 10 share to all shareholders
the profit or dividend that has from the undistributed profits, based on the total number of shares
been reviewed, approved, and eligible for profit distribution for the year end 31 December 2025. No
announced for payment. stock dividends will be distributed, nor will there be any conversion of
capital reserves into share capital.
Note: The profit distribution plan above shall be implemented after being reviewed and
approved by the general meeting of shareholders.
(a) On 12 March 2026, upon the approval of the resolutions passed at the 14th Meeting of the
for credit facilities from banks and other financial institutions in 2026 through various
methods including credit, guarantee, mortgage and pledge, with the outstanding balance of
actual borrowings under such credit facilities not exceeding RMB 1.2 billion. The proposal
for the total credit facilities from banks is still pending approval by the Company's
shareholders' meeting.
(b) On 12 March 2026, upon the approval of the resolutions passed at the 14th Meeting of the
subsidiaries in 2026 in respect of credit facilities applied from banks and other financial
institutions, with the amount not exceeding RMB 300 million. Such limit is included within
the actual borrowing limit of RMB 1.2 billion under the credit facilities. The proposal for the
aforementioned guarantee limit is still pending approval by the Company's shareholders'
meeting.
As at 12 March 2026, the Company has no other events after the reporting period that require
disclosure.
The Company identifies operating segments according to its internal organization structure,
management requirements and internal reporting systems. Then the reportable segments are to
be determined based on the Company’s operating segments:
(a) its business activities are engaged to generate revenue and incur expenses;
(b) its operating results are regularly reviewed by the Company’s management to make
decisions on resources allocation and performance assessment;
(c) its financial conditions, operating results, cash flow and related accounting information are
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
available to the Company.
The Company determines the reporting segment based on the operating segment, and the
operating segment that meets any of the following conditions is determined as the reporting
segment:
(a) The segment income of the operating segment accounts for 10.00% or more of total
income of all segments;
(b) The absolute amount of profits (losses) of the segment account for 10.00% or more of the
higher of the absolute amount of total profits of the profiting segment and the absolute
amount of total losses of the unprofitable segment.
The Company’s business is simple. The business mainly involves manufacturing and sales of
watch. The management considers the business as a whole in implementing management and
assessing its performance. As a result, no segment information is disclosed in this financial
statement.
As at 31 December 2025, the Company does not have other significant matters that require to
disclose.
PARENT COMPANY
(a) Accounts receivable by aging
Aging 31 December 2025 31 December 2024
Within one year 10,466,091.51 6,238,972.29
Subtotal 319.04
Less: provision for bad debt 12,103,666.34 6,478,103.75
Total 2,120,455.62 1,846,113.37
(b) Accounts receivable by bad debt provision method
Category Book balance Provision for bad debt
Carrying
Proportion Provision amount
Amount Amount
(%) ratio (%)
Provision for bad debt recognised
individually 2,303,565.35 19.03 1,970,570.09 85.54 332,995.26
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Category Book balance Provision for bad debt
Carrying
Proportion Provision amount
Amount Amount
(%) ratio (%)
Provision for bad debt recognised
by groups 9,800,100.99 80.97 149,885.53 1.53 9,650,215.46
Including: Group 1 4,632,024.39 38.27 149,885.53 3.24 4,482,138.86
Receivable from Related party in
scope of consolidation 5,168,076.60 42.70 5,168,076.60
Total 12,103,666.34 100.00 2,120,455.62 17.52 9,983,210.72
(Continued)
Category Book balance Provision for bad debt
Carrying
Proportion Provision amount
Amount Amount
(%) ratio (%)
Provision for bad debt recognised
individually
Provision for bad debt recognised
by groups
Including: Group 1 4,041,736.34 62.39 214,314.71 5.30 3,827,421.63
Receivable from Related party in
scope of consolidation
Total 6,478,103.75 100.00 1,846,113.37 28.50 4,631,990.38
Detailed explanation of provision for bad debt:
(i)As at 31 December 2025, accounts receivable with bad debt provision recognised
individually
Name Provision for bad Reason for
Book balance Provision ratio (%)
debt provision
Expected to be
Other customers 2,303,565.35 1,970,570.09 85.54
irrecoverable
(ii) As at 31 December 2025, accounts receivable with bad debt provision recognised by
group 1
Aging Accounts Provision for Provision Accounts Provision for Provision
receivable bad debt ratio (%) receivable bad debt ratio (%)
Within
one year
Total 4,632,024.39 149,885.53 3.24 4,041,736.34 214,314.71 5.30
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(c) Changes of provision for bad debt during the reporting period
Changes during the reporting period
Category Recovery Elimination
or reversal or write-off
Provision for bad debt
recognised 1,631,798.66 338,771.43 1,970,570.09
individually
Provision for bad debt
recognised by groups
Including:Group1 214,314.71 -64,429.18 149,885.53
Total 1,846,113.37 274,342.25 2,120,455.62
(d) No accounts receivable written off during the reporting period
(e) Top five closing balances by entity
Balance of accounts Proportion of the balance Provision for bad
Entity name receivable as at 31 to the total accounts debt of accounts
December 2025 receivable (%) receivable
Total of the top five accounts
receivable balances at the end 9,623,667.20 1,268,165.48 79.51
of the period
(a) Other receivables by aging
Aging 31 December 2025 31 December 2024
Within one year 545,738,870.53 659,558,728.69
Over 3 years 40,050.00 40,050.00
Subtotal 545,791,977.16 659,622,488.10
Less: provision for bad debt 40,702.83 56,619.62
Total 545,751,274.33 659,565,868.48
(b) Other receivables by nature
Nature 31 December 2025 31 December 2024
Related party in scope of
consolidation 545,517,289.16 658,724,812.91
Deposit and guarantee receivable 61,809.82 119,550.00
Others 212,878.18 778,125.19
Subtotal 545,791,977.16 659,622,488.10
Less: provision for bad debt 40,702.83 56,619.62
Total 545,751,274.33 659,565,868.48
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(c) Other receivables by bad debt provision method
A. As at 31 December 2025, provision for bad debt recognised based on three stages model
Stages Book balance Provision for bad debt Carrying amount
Stage 1 545,791,977.16 40,702.83 545,751,274.33
As at 31 December 2025, provision for bad debt at stage 1:
Provision Provision for
Category Book balance Carrying amount
ratio (%) bad debt
Provision for bad debt recognised
individually
Provision for bad debt recognised by
groups 545,791,977.16 0.01 40,702.83 545,751,274.33
Including: Deposit and guarantee
receivable 61,809.82 65.80 40,673.05 21,136.77
Related party in scope of
consolidation 545,517,289.16 545,517,289.16
Others 212,878.18 0.01 29.78 212,848.40
Total 545,791,977.16 0.01 40,702.83 545,751,274.33
B. As at 31 December 2024, provision for bad debt recognised based on three stages model
Stages Book balance Provision for bad debt Carrying amount
Stage 1 659,622,488.10 56,619.62 659,565,868.48
As at 31 December 2024, provision for bad debt at stage 1:
Provision Provision for
Category Book balance Carrying amount
ratio (%) bad debt
Provision for bad debt recognised
individually
Provision for bad debt recognised by
groups 659,622,488.10 0.01 56,619.62 659,565,868.48
Including: Deposit and guarantee
receivable 119,550.00 36.83 44,025.00 75,525.00
Related party in scope of
consolidation 658,724,812.91 658,724,812.91
Others 778,125.19 1.62 12,594.62 765,530.57
Total 659,622,488.10 0.01 56,619.62 659,565,868.48
Basis of provision for bad debt during the reporting period:
For details of recognition criteria and explanation for provision of bad debt by groups, please
refer to Notes 3.11
(d) Changes of provision for bad debt during the reporting period
Changes during the reporting period
Category Recovery Elimination
or reversal or write-off
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Changes during the reporting period
Category Recovery Elimination
or reversal or write-off
Provision for bad debt
recognised by groups
(e) No other receivables written off during the reporting period
(f) Top five closing balances by entity
Percentage
of Total
Balance as at 31 Age of Other Provision for
Entity name Nature of Amount
December 2025 Amount Receivables Bad Debts
at Period
End (%)
Related party in scope of Within 1
No. 1 427,402,059.90 78.31
consolidation year
Related party in scope of Within 1
No. 2 63,265,181.51 11.59
consolidation year
Related party in scope of Within 1
No. 3 28,923,820.90 5.30
consolidation year
Related party in scope of Within 1
No. 4 15,680,483.80 2.87
consolidation year
Related party in scope of Within 1
No. 5 6,000,000.00 1.10
consolidation year
Items Provision Provision
Book balance for Carrying amount Book balance for Carrying amount
impairment impairment
Subsidiaries 1,592,543,885.91 1,592,543,885.91 1,592,543,885.91 1,592,543,885.91
Associates 46,436,556.86 46,436,556.86 50,907,036.84 50,907,036.84
Total 1,638,980,442.77 1,638,980,442.77 1,643,450,922.75 1,643,450,922.75
(a) Investments in subsidiaries
Provisi
Investees on for Additional Disposal of Provision for Provision for
Book balance Others Book balance
impair investment investment impairment impairment
ment
ShenzhenHARMONYWo 609,891,973.62 609,891,973.62
rldWatchCenterCo.,Ltd.
ShenzhenHarmonyE-
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
commerceCo.,Ltd.
ShenzhenFIYTAPrecision 182,290,834.31 182,290,834.31
TechnologyCo.,Ltd.
ShenzhenFIYTATechnolo 51,160,141.67 51,160,141.67
gyDevelopmentCo.,Ltd.
FIYTA(HongKong)Ltd.
Temporal(Shenzhen)Co.,L 5,000,000.00 5,000,000.00
td.
FIYTASalesCo.,Ltd.
LiaoningHengdaruiComm 36,867,843.96 36,867,843.96
ercial&TradeCo.,Ltd.
EmileChoureitTiming(She 80,613,904.83 80,613,904.83
nzhen)Ltd.
HARMONYWorldWatch 10,000,000.00 10,000,000.00
Center(Hainan)Co.,Ltd.
ShenzhenXunhangPrecisi 10,000,000.00
onTechnologyCo.,Ltd.
Total
(b) Investments in associates
Changes during the reporting period
Investees Changes
in other
reporting reporting under the comprehensive
equity
period period equity method income
Shanghai
Watch Co., Ltd.
(Continued)
Changes during the reporting period Provision for
Declaration of cash 31 December impairment at
Investees Provision for
dividends or Others 2025 31 December
impairment 2025
distribution of profit
Investees 46,436,556.86
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
Items
Revenue Costs of sales Revenue Costs of sales
Principal
activities
Other activities 3,858,500.75 3,524,696.56
Total 184,540,282.60 56,887,861.74 180,874,926.74 49,729,440.87
Items 2025 2024
Investment income from long-term equity investments
under equity method
Investment income from long-term equity investments
-955,570.46 -5,819,479.60
under cost method
Total 287,322,662.30 192,180,520.40
Items 2025
Gains /(losses) on disposal of non-current assets (including the written-
-1,233,966.09
off portion of provisions for asset impairment)
Government grants (except for government grants which are closely
related to the ordinary course of business of the Company, in
compliance with national policies and regulations, granted in 3,071,440.46
accordance with the determined standards; and influence the profit and
loss on an ongoing basis) charged to gains or losses for the period
Non-financial business’s gains or losses from fair value change
arising from financial assets and financial liabilities held and gains or
losses from disposal of financial assets and financial liabilities, other 437,789.65
than effective value protection hedges relating to the Company’s
ordinary course of business
Reversal of provision for impairment of individually tested
receivables
Other non-operating income/expenses except for items mentioned
above
Other profit /(loss) items that meet the definition of non-recurring
profit or loss
Total non-recurring profit /(loss) 5,099,818.58
Less: Income tax effect 961,852.20
Net non-recurring profit /(loss) 4,137,966.38
Less: net non-recurring profit /(loss) attributable to non-controlling
interest
Net non-recurring profit /(loss) attributable to ordinary shareholders 4,137,966.38
FIYTA Precision Technology Co., Ltd. Notes to the financial statements
(a) 2025
Weighted average return EPS
Profit for the reporting period
on net assets (%) Basic Diluted
Net profit attributable to ordinary
shareholders 2.60 0.2153 0.2152
Net profit attributable to ordinary
shareholders after non-recurring profit 2.48 0.2051 0.2050
or losses
(b) 2024
Weighted average return EPS
Profit for the reporting period
on net assets (%) Basic Diluted
Net profit attributable to ordinary
shareholders 6.55 0.5385 0.5378
Net profit attributable to ordinary
shareholders after non-recurring profit 6.21 0.5100 0.5093
or losses
FIYTA Precision Technology Co., Ltd.
Board of Directors
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