Auditor's Report
China Fangda Group Co., Ltd.
RSM [2026] No.510Z0221
RSM China (Special General Partnership)
China · Beijing
Table of Contents
Page
No. Content:
number
Statement of Change in Owners' Equity (Parent
Company)
RSM Thornton (limited liability partnership)
Head office: No.22, Fuchengmenwai Street, Xicheng
District, Beijing
Unit 1001-1 to 1001-26, 10th Floor, Building 1 (100037)
Auditors' Report TEL:010-6600 1391 FAX:010-6600 1392
E-mail:bj@rsmchina.com.cn
https://www.rsm.global/china/
RSM [2026] No.510Z0221
To the shareholders of China Fangda Group Co., Ltd.:
We have audited the financial statements of Fangda Group Co., Ltd. (hereinafter
referred to as Fangda group company), including the consolidated and parent
company's balance sheet as of December 31, 2025, the consolidated and parent
company's income statement, consolidated and parent company's cash flow statement,
consolidated and parent company's statement of changes in owner's equity and notes to
relevant financial statements in 2025.
We believe that Fangda Group has been following with the Enterprise Accounting
Standard in preparing of the Financial Statements. The Financial Statements is
reflecting, in all important aspects, the financial situation of Fangda Group as of
December 31, 2025, and the business performance and cash flow of year 2025.
We carried out the auditing works with compliance to Chinese CPA Auditing
Standard, The "CPA's Responsibility for Auditing Financial Statements" section of the
audit report further elaborated our responsibilities under these guidelines. In
accordance with the Code of Professional Ethics for Chinese Certified Public
Accountants and the Independence Standards for Chinese Certified Public Accountants,
we are independent of China Fangda Group Co., Ltd. and have complied with the
provisions of the independence standards applicable to audits of financial statements of
public interest entities, while fulfilling our other ethical responsibilities. We believe
that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.
The key audit matters are the matters that we believe are most important for the
audit of the current financial statements based on professional judgment. The response
to these matters is based on the overall audit of the financial statements and the
formation of an audit opinion. We do not comment on these matters separately.
(I) Income recognition
For related information disclosure, please refer to Note III, 26, Note V, 43 and
Note XV, 2 of the financial statements.
In 2025, the operating revenue of Fangda Group is RMB3.377 billion, of which
the revenue of curtain wall and metro platform screen door accounts for 93.76% of the
total revenue of the Group.
Fangda Group's performance obligations related to the construction
subcontracting contract include building curtain wall and metro platform screen door.
As the customer can control the commodity under construction in the process of
performance of Fangda group, the Company regards it as the performance obligation
within a certain period of time, and recognizes the revenue according to the
performance progress. The Company shall determine the performance schedule of
services according to the input method. The performance schedule shall be determined
according to the proportion of the actual contract cost to the estimated total contract
cost. Management needs to make a reasonable estimate of the initial total contract
revenue and total contract costs for the Engineering contracting contract and continue
to assess and revise it during the contract implementation process, which involves
significant accounting estimates of the management.
Therefore, we identify revenue recognition related to construction contracts as
key audit matters.
Our audit procedures for revenue recognition related to construction
subcontracting contracts mainly include:
(1) Understand and evaluate the design of internal control related to management
contract and engineering subcontracting contract budget and revenue recognition, and
test the effectiveness of key control implementation.
(2) Obtained a major engineering subcontracting contract, verified the contract
revenue, and reviewed key contract terms. Check the engineering contracting contract
and cost budget information on which management expects total revenue and
estimated total cost.
(3) Obtain the construction subcontracting contract account and project revenue
and cost summary table, carry out analytical review on the gross profit of the project,
and recalculate the performance progress and revenue in the construction
subcontracting contract account to verify its accuracy.
(4) Select samples to check the project engineering details of the main project,
subcontracted labor approval forms, and the owner's production value approval
documents and records to verify the contract costs incurred.
(5) Select samples to check if the relevant contract costs are recorded in the
appropriate accounting period.
(6) Select a sample to conduct a site inspection of the progress of the project
image to verify the reasonableness of the project's performance schedule.
(II) Measurement of fair value of investment real estate
For related information disclosure, please refer to Note III, 17, Note V, 15, Note
V 51 and Note XI of the financial statements.
As of Wednesday, December 31, 2025, the book balance of the investment real
estate of Fangda group which adopts the fair value model for subsequent measurement
is RMB5.548 billion, accounting for 44.12% of the total assets. The income from
changes in fair value realized in the current period is RMB-281,000,000 which has a
great impact on the financial indicators of the Group's consolidated statements.
The management of Fangda Group annually employs a third-party assessment
agency with relevant qualifications to evaluate the fair value of the investment real
estate. The evaluation adopts the market comparison method and the income method to
comprehensively analyze various factors that affect the real estate price of the
appraisal subject. The assessment of the fair value of investment real estate involves
many estimates and assumptions, such as the analysis of the economic environment
and future trends of the real estate where the investment real estate is located, discount
rates, etc. The changes in estimates and assumptions will have big impacts on the fair
value of the investment real estate evaluated. Therefore, we identify the measurement
of fair value of investment real estate as a key audit matter.
Our audit procedures for the measurement of fair value of investment real estate
mainly include:
(1) Assess the competency, professional quality, independence and objectivity of
third-party assessment agencies employed by the management.
(2) Obtain the assessment report, selected major or typical samples, and use our
real estate appraisal experts to review and review the assessment methods and
assumptions used in the assessment report and the rationality of the selected key
assessment parameters. Check the accuracy and relevance of the data used by the
management in valuation.
(3) Review the measurement, presentation and disclosure of fair value of
investment real estate in the financial statements.
(III) Measurement of expected credit loss of accounts receivable and contract
assets
For related information disclosure, please refer to Note III, 11, Note V, 5, Note V,
As of December 31, 2025, the Company's total accounts receivable amounted to
RMB1.488 billion, with an allowance for doubtful accounts of RMB602 million; the
total contract assets amounted to RMB2.340 billion, with an impairment provision of
RMB226 million. The combined carrying amount of accounts receivable and contract
assets represented 23.85% of the Company's total assets. Due to the large amount of
accounts receivable and contract assets of Fangda group, the management needs to use
important accounting estimation and judgment when determining the expected
recoverable amount of accounts receivable and contract assets, and the expected credit
loss of accounts receivable and contract assets is important for financial statements.
Therefore, we determine the measurement of expected credit loss of accounts
receivable and contract assets as the key audit accounting matters.
(1) Understand and evaluate the effectiveness of internal control design related to
the provision for bad debts of accounts receivable and provision for impairment of
contract assets of Fangda Group, and test the effectiveness of key control operation.
(2) Review the relevant considerations and objective evidence of the
management's credit risk assessment of accounts receivable and contract assets, and
evaluate whether the management has properly identified the credit risk characteristics
of various accounts receivable.
(3) We reviewed management's process for calculating the allowance for doubtful
accounts on accounts receivable and the impairment provision on contract assets,
including:
① For accounts receivable and contract assets measured for expected credit losses on
a portfolio basis, we evaluated the reasonableness of management's grouping by credit
risk characteristics; examined the expected credit loss measurement model and
assessed the reasonableness of significant assumptions and key parameters therein;
obtained the aging schedule of accounts receivable and the corresponding table of
expected credit loss rates over the instruments' lifetime prepared by management, and
tested the accuracy and completeness of the data used by management as well as the
correctness of the allowance calculation;
② For accounts receivable and contract assets subject to individual expected credit
loss assessment, we reviewed the accuracy and reasonableness of the information and
underlying assumptions used by management in its testing process; and verified the
accuracy of impairment provisions recognized for aged accounts receivable and
contract assets, as well as those involved in litigation matters.
(4) According to the characteristics and nature of customer transactions, select
samples to implement the accounts receivable confirmation procedure and check the
collection after the period, and evaluate the rationality of the provision for bad debts of
accounts receivable.
The management of Fangda Group (hereinafter referred to as management) is
responsible for other information. The other information includes the information
covered in Fangda Group's 2025 annual report, but does not include the financial
statements and our audit report.
Our audit opinions published in the financial statements do not cover other
information and we do not publish any form of assurance conclusion on other
information.
In connection with our audit of the financial statements, our responsibility is to
read other information. In the process, we consider whether there is a material
inconsistency or other material misstatement of other information whether it is in the
financial statements or what we have learned during the audit process.
Based on the work we have performed, if we determine that there is a material
misstatement of other information, we should report that fact. In this regard, we have
nothing to report.
(1) Preparing these financial statements according to the Accounting Standards
for Business Enterprises and presenting them fairly; (2) designing, implementing and
maintaining necessary internal control to make sure that these financial statements are
free from material misstatement, whether due to fraud or error.
In the preparation of the financial statements, the management is responsible for
assessing Fangda Group's ability to continue as a going concern, disclosing issues
related to going concern (if applicable), and applying the going concern assumption
unless management plans to liquidate Fangda Group, terminate operations or there are
no other realistic choices.
The management is responsible for overseeing the financial reporting process of
Fangda Group.
Our objective is to obtain reasonable assurance as to whether the entire financial
statements are free from material misstatement due to fraud or error and to issue an
audit report containing audit opinions. Reasonable assurance is a high level of
assurance, but it does not guarantee that an audit performed in accordance with
auditing standards can always be discovered when a major misstatement exists. The
report may be due to fraud or mistakes, and if a reasonable expectation of misstatement
alone or aggregated may affect the economic decision-making made by users of
financial statements based on the financial statements, the misstatement is generally
considered to be material.
In the process of conducting audit work in accordance with auditing standards, we
use professional judgment and maintain professional suspicion. At the same time, we
also perform the following tasks:
(1) Identify and assess risks of material misstatement of financial statements due
to fraud or errors, design and implement audit procedures to address these risks, and
obtain adequate and appropriate audit evidence as a basis for issuing audit opinions. As
fraud may involve collusion, forgery, willful omission, misrepresentation or override
of internal control, the risk of not discovering a material misstatement due to fraud is
higher than the risk of not discovering a material misstatement resulting from a
mistake.
(2) Understand audit-related internal controls to design appropriate audit
procedures.
(3) Evaluate the appropriateness of accounting policies adopted by the
management and the reasonableness of accounting estimates and related disclosures.
(4) Conclude on the appropriateness of management's use of continuing
operations assumptions. At the same time, based on the audit evidence obtained, it
concludes that whether there are major uncertainties in the matters or circumstances
that may cause major doubts about the ability of the Company's continuing operations.
If we conclude that there are significant uncertainties, the auditing standards require us
to request the users of the report to pay attention to the relevant disclosures in the
financial statements in the audit report; if the disclosure is not sufficient, we should
publish non-unqualified opinions. Our conclusions are based on the information
available as of the date of the audit report. However, future events or circumstances
may result in Fangda Group's inability to continue operating.
(5) Evaluate the overall presentation, structure, and content of the financial
statements and evaluate whether the financial statements fairly reflect the relevant
transactions and events.
(6) Obtain sufficient and appropriate audit evidence on the financial information
of entity or business activities in Fangda Group to express opinions on the financial
statements. We are responsible for directing, supervising and executing group audits
and assume full responsibility for audit opinions.
We communicate with the governance team on planned audit scope, timing, and
major audit findings, including communication of the internal control deficiencies that
we identified during the audit.
We also provide a statement to the management on compliance with ethical
requirements related to independence, and communicate with the management on all
relationships and other matters that may reasonably be considered to affect our
independence, as well as related preventive measures (if applicable).
From the matters passed with the management, we determine which items are
most important for the audit of the financial statements of the current period and thus
constitute the key audit matters. We describe these matters in our audit report, unless
laws and regulations prohibit the public disclosure of these matters, or in rare cases, if
it is reasonably expected that the negative consequences of communicating something
in the audit report will outweigh the benefits in the public interest, we determine that
such matter should not be communicated in the audit report.
(No text follows)
(This page has no text. It is the signature and stamp page of audit report No.
[2026]510Z0221 of China Fangda Group Co., Ltd. ）
RSM China CPA:
(limited liability Zhou Junchao (Project
partnership) Partner)
Beijing, China CPA:
Yang Yang
April 3, 2026
Consolidated Balance Sheet
December 31,2025
Prepared by: China Fangda Group Co., Ltd. In RMB
Item Note December 31,2025 December 31,2024 Item Note December 31,2025 December 31,2024
Current asset: Current liabilities
Monetary capital V. 1 1,401,292,102.72 1,491,777,341.84 Short-term loans V. 23 1,202,846,497.03 1,663,696,422.48
Transactional financial assets V. 2 410.06 - Transactional financial liabilities - -
Derivative financial assets V. 3 1,459,950.00 - Derivative financial liabilities V. 24 - 1,520,625.00
Notes receivable V. 4 121,778,063.00 73,887,694.24 Notes payable V. 25 429,110,637.53 681,188,127.97
Account receivable V. 5 885,516,557.23 1,123,506,196.98 Account payable V. 26 2,040,691,220.16 2,146,594,890.57
Receivable financing V. 6 - 4,568,000.10 Prepayment received V. 27 3,517,539.83 1,513,398.39
Prepayment V. 7 20,407,968.16 23,355,036.11 Contract liabilities V. 28 350,155,877.61 268,594,041.26
Other receivables V. 8 120,173,307.70 168,322,524.80 Employees' wage payable V. 29 67,812,846.09 76,243,647.97
Including: interest receivable - - Taxes payable V. 30 40,439,297.75 48,847,117.19
Dividend receivable - - Other payables V. 31 125,372,728.24 120,918,002.02
Inventory V. 9 685,058,418.56 705,666,408.74 Including: interest payable
Among them: data resources - - Dividend payable
Contract assets V. 10 1,998,091,151.43 2,247,698,479.96 Liabilities held for sales
Assets held for sales - - Non-current liabilities due in 1 year V. 32 379,089,194.66 131,374,661.05
Non-current assets due in 1 year - - Other current liabilities V. 33 60,918,938.51 50,835,559.67
Other current assets V. 11 296,646,964.92 307,777,143.14 Total current liabilities 4,699,954,777.41 5,191,326,493.57
Total current assets 5,530,424,893.78 6,146,558,825.91 Non-current liabilities:
Non-current assets: Long-term loans V. 34 1,290,000,000.00 1,137,000,000.00
Debt investment Bond payable -
Other debt investment Including: preferred stock -
Long-term receivables Perpetual bond -
Long-term share equity
V. 12 32,988,644.63 56,690,973.97 Lease liabilities V. 35 8,979,546.87 10,652,607.48
investment
Investment in other equity tools - Long-term payable -
Other non-current financial Long-term employee benefits
V. 13 6,516,131.63 6,519,740.17 -
assets payable
Investment real estate V. 14 5,548,371,426.50 5,835,036,098.20 Anticipated liabilities V. 36 1,455,390.21 1,286,391.72
Fixed assets V. 15 940,980,113.90 940,894,344.39 Deferred earning V. 37 26,304,277.69 10,669,612.13
Construction in process V. 16 1,214,530.34 7,265,104.44 Deferred income tax liabilities V. 20 941,080,689.22 1,030,341,141.92
Productive biological assets - Other non-current liabilities
Gas & petrol - Total of non-current liabilities 2,267,819,903.99 2,189,949,753.25
Use right assets V. 17 13,470,006.41 15,683,121.04 Total liabilities 6,967,774,681.40 7,381,276,246.82
Intangible assets V. 18 82,258,834.99 124,052,394.79 Owner's equity:
Among them: data resources Share capital V. 38 1,073,874,227.00 1,073,874,227.00
R&D expense Other equity tools
Among them: data resources Including: preferred stock
Goodwill Perpetual bond
Long-term amortizable expenses V. 19 6,562,494.97 4,041,025.70 Capital reserves V. 39 4,357,948.33 4,357,948.33
Deferred income tax assets V. 20 266,869,033.36 205,986,926.71 Less: Shares in stock -
Other non-current assets V. 21 145,743,957.24 212,658,669.89 Other miscellaneous income V. 40 161,046,834.50 158,405,014.52
Total of non-current assets 7,044,975,173.97 7,408,828,399.30 Special reserves -
Surplus reserve V. 41 85,368,328.00 83,974,716.22
Undistributed profit V. 42 4,234,637,792.91 4,805,192,000.28
Total of owner's equity belong to
the parent company
Minor shareholders' equity 48,340,255.61 48,307,072.04
Total of owners' equity 5,607,625,386.35 6,174,110,978.39
Total of liabilities and owner's
Total of assets 12,575,400,067.75 13,555,387,225.21 12,575,400,067.75 13,555,387,225.21
interest
Legal representative: CFO: Accounting firm manager:
Consolidated Income Statement
Prepared by: China Fangda Group Co., Ltd. In RMB
Item Note 2025 2024
Incl. Business income V. 43 3,377,303,066.44 4,424,224,197.71
Incl. Business cost V. 43 2,921,536,952.53 3,588,142,296.48
Taxes and surcharges V. 44 36,011,342.42 43,364,391.34
Sales expense V. 45 57,404,021.17 55,140,153.13
Administrative expense V. 46 179,347,723.55 191,667,435.20
R&D cost V. 47 132,814,412.12 171,031,371.73
Financial expenses V. 48 78,533,485.32 65,297,933.04
Including: interest cost V. 48 73,451,706.21 60,377,020.35
Interest income V. 48 10,685,216.12 19,230,549.61
Add: other gains V. 49 10,569,849.85 19,683,263.58
Investment gains ("-" for loss) V. 50 -25,773,481.21 -4,547,362.60
Incl. Investment gains from affiliates and joint ventures V. 50 -23,702,329.34 -70,043.43
Financial assets derecognized as a result of amortized cost V. 50 -3,565,876.31 -2,538,217.26
Net open hedge gains ("-" for loss) -
Gains from change of fair value ("-" for loss) V. 51 -280,735,167.15 -18,394,198.42
Credit impairment ("-" for loss) V. 52 -252,544,839.46 -110,686,852.25
Investment impairment loss ("-" for loss) V. 53 -30,626,112.52 -35,260,579.49
Investment gains ("-" for loss) V. 54 -3,032,277.77 -500,192.81
Plus: non-operational income V. 55 582,660.42 1,712,412.29
Less: non-operational expenditure V. 56 18,360,766.41 2,226,292.50
Less: Income tax expenses V. 57 -112,831,775.11 13,192,524.27
(1) By operating consistency
(2) By ownership
(1) After-tax net amount of other misc. incomes attributed to parent's owner 2,641,819.98 113,861,211.98
(1) Re-measure the change in the defined benefit plan
(2) Other comprehensive income that cannot be transferred to profit or loss under the equity method
(3) Fair value change of investment in other equity tools
(4) Fair value change of the company's credit risk
(1) Other comprehensive income that can be transferred to profit or
loss under the equity method
(2) Fair value change of other debt investment
(3) Gains and losses from changes in fair value of available-for-sale
financial assets
(4) Other credit investment credit impairment provisions
(5) Cash flow hedge reserve V. 58 2,533,488.76 -1,440,207.76
(6) Translation difference of foreign exchange statement V. 58 295,993.10 -769,741.24
(2) After-tax net of other misc. income attributed to minority
-485.72 -3,771.05
shareholders
(1) Total of misc. incomes attributable to the owners of the parent company -512,825,064.26 258,674,917.51
(2) Total misc gains attributable to the minor shareholders 33,168.71 1,350,813.74
(1) Basic earnings per share (yuan/share) -0.48 0.13
(2) Diluted earnings per share (yuan/share) -0.48 0.13
Legal representative: CFO: Accounting firm manager:
Consolidated Cash Flow Statement
Prepared by: China Fangda Group Co., Ltd. In RMB
Item Note 2025 2024
Cash received from sales of products and providing of services 3,736,526,691.18 4,480,307,796.77
Tax refunded 87,812,070.80 20,223,216.89
Other cash received from business operation V. 59 153,978,372.04 115,024,150.76
Sub-total of cash inflow from business operations 3,978,317,134.02 4,615,555,164.42
Cash paid for purchasing products and services 2,964,314,842.23 3,476,800,439.66
Cash paid to and for the staff 483,554,744.62 500,142,274.75
Taxes paid 186,348,404.40 187,032,846.31
Other cash paid for business activities V. 59 156,686,242.90 180,685,510.27
Sub-total of cash outflow from business operations 3,790,904,234.15 4,344,661,070.99
Cash flow generated by business operations, net 187,412,899.87 270,894,093.43
Cash received from investment recovery 1,089,745,926.15 1,785,649.27
Cash received as investment profit 1,426,386.60 214,188.46
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets 52,154,307.71 8,161,249.68
Net cash received from disposal of subsidiaries or other operational units
Other investment-related cash received
Sub-total of cash inflow generated from investment 1,143,326,620.46 10,161,087.41
Cash paid for construction of fixed assets, intangible assets and other long-term assets 98,345,774.80 229,651,090.29
Cash paid as investment 1,089,326,003.52 27,416,773.30
Net cash paid for acquiring subsidiaries and other operational units
Other cash paid for investment V. 59 1,787,676.30
Subtotal of cash outflows 1,187,671,778.32 258,855,539.89
Cash flow generated by investment activities, net -44,345,157.86 -248,694,452.48
Cash received from investment 14.86 14,873.62
Incl. Cash received from investment attracted by subsidiaries from minority shareholders 14.86 14,873.62
Cash received from borrowed loans 2,516,692,628.24 3,503,675,536.37
Other cash received from financing activities V. 59 100,842,000.00 463,600,944.44
Subtotal of cash inflow from financing activities 2,617,534,643.10 3,967,291,354.43
Cash paid to repay debts 2,563,323,480.12 3,451,800,000.00
Cash paid as dividend, profit, or interests 126,024,225.73 167,473,899.50
Incl. Dividend and profit paid by subsidiaries to minority shareholders 6,962,732.02
Other cash paid for financing activities V. 59 12,963,429.49 119,400,311.19
Subtotal of cash outflow from financing activities 2,702,311,135.34 3,738,674,210.69
Net cash flow generated by financing activities -84,776,492.24 228,617,143.74
Plus: Balance of cash and cash equivalents at the beginning of term 1,031,725,216.34 779,661,118.42
Legal representative: CFO: Accounting firm manager:
Statement of Change in Owners' Equity
Prepared by: China Fangda Group Co., Ltd. In RMB
Owners' Equity Attributable to the Parent Company
Item Other equity tools Minor
Other Total of owners'
Less: Shares in Special Surplus Undistributed shareholders'
Share capital Capital reserves miscellaneous Subtotal equity
Preferred Perpetual stock reserves reserve profit equity
Others income
share bond
Plus: Changes in accounting policies - -
Correction of previous errors - -
Others - -
- - - - - - 2,641,819.98 - 1,393,611.78 -570,554,207.37 -566,518,775.61 33,183.57 -566,485,592.04
decrease)
(1) Total of misc. incomes 2,641,819.98 -515,466,884.24 -512,825,064.26 33,168.71 -512,791,895.55
(2) Investment or decreasing of capital by
- - - - - - - - - - - 14.86 14.86
owners
- -
instrument holders
- -
owners' equity
(3) Profit allotment - - - - - - - - 1,393,611.78 -55,087,323.13 -53,693,711.35 - -53,693,711.35
(4) Internal carry-over of owners' equity - - - - - - - - - - - - -
- -
capital)
- -
capital)
(5) Special reserves - - - - - - - - - - - - -
(6) Others - -
IV. Closing balance 1,073,874,227.00 - - - 4,357,948.33 - 161,046,834.50 - 85,368,328.00 4,234,637,792.91 5,559,285,130.74 48,340,255.61 5,607,625,386.35
Legal representative: CFO: Accounting firm manager:
Statement of Change in Owners' Equity
Prepared by: China Fangda Group Co., Ltd. In RMB
Owners' Equity Attributable to the Parent Company
Item Minor
Other Total of owners'
Other equity tools Less: Shares in Special Surplus Undistributed shareholders'
Share capital Capital reserves miscellaneous Subtotal equity
Preferred Perpetual stock reserves reserve profit equity
Others income
share bond
Plus: Changes in accounting policies - -
Correction of previous errors - -
Others - -
- - - - -7,101,640.07 - 135,283,143.73 - 4,649,775.79 32,832,059.83 165,663,339.28 -26,348,199.16 139,315,140.12
decrease)
(1) Total of misc. incomes 113,861,211.98 144,813,705.53 258,674,917.51 1,350,813.74 260,025,731.25
(2) Investment or decreasing of capital by
- - - - -7,101,640.07 - - - - - -7,101,640.07 -20,736,280.88 -27,837,920.95
owners
- -
instrument holders
- -
owners' equity
(3) Profit allotment - - - - - - - - 5,728,420.02 -91,638,358.18 -85,909,938.16 -6,962,732.02 -92,872,670.18
(4) Internal carry-over of owners' equity - - - - - - 21,421,931.75 - -1,078,644.23 -20,343,287.52 - - -
- -
capital)
- -
capital)
(5) Special reserves - - - - - - - - - - - - -
(6) Others - -
IV. Closing balance 1,073,874,227.00 - - - 4,357,948.33 - 158,405,014.52 - 83,974,716.22 4,805,192,000.28 6,125,803,906.35 48,307,072.04 6,174,110,978.39
Legal representative: CFO: Accounting firm manager:
Balance Sheet of the Parent Company
December 31, 2025
Prepared by: China Fangda Group Co., Ltd. In RMB Currency: RMB
Assets Note December 31, 2025 December 31, 2024 Liabilities and owner's interest Note December 31, 2025 December 31, 2024
Current asset: Current liabilities
Monetary capital 20,613,570.12 45,751,906.05 Short-term loans
Transactional financial assets Transactional financial liabilities
Derivative financial assets Derivative financial liabilities
Notes receivable Notes payable
Account receivable XVI. 1 5,225,854.36 2,885,125.35 Account payable 845,545.88 873,640.82
Receivable financing Prepayment received 758,736.42 749,684.15
Prepayment 342,719.99 145,287.27 Contract liabilities
Other receivables XVI. 2 1,131,454,187.78 1,622,103,166.85 Employees' wage payable 1,883,259.98 2,834,942.51
Including: interest receivable Taxes payable 248,881.74 286,140.09
Dividend receivable Other payables 1,005,650,528.32 1,437,682,555.06
Inventory Including: interest payable
Among them: data resources Dividend payable
Contract assets Liabilities held for sales
Non-current liabilities due in 1
Assets held for sales 2,839,640.73 3,531,740.50
year
Non-current assets due in 1 year Other current liabilities 259,291.84 164,239.72
Other current assets 2,482,430.99 2,081,838.29 Total current liabilities 1,012,485,884.91 1,446,122,942.85
Total current assets 1,160,118,763.24 1,672,967,323.81 Non-current liabilities:
Non-current assets: Long-term loans
Debt investment Bond payable
Other debt investment Including: preferred stock
Long-term receivables Perpetual bond
Long-term share equity
XVI. 3 1,706,562,530.00 1,657,062,530.00 Lease liabilities 727,265.94 4,614,693.40
investment
Investment in other equity tools Long-term payable
Other non-current financial Long-term employee benefits
assets payable
Investment real estate 376,551,400.00 380,644,350.00 Anticipated liabilities
Fixed assets 44,963,441.98 46,688,469.68 Deferred earning -
Construction in process Deferred income tax liabilities 46,328,991.71 42,909,713.11
Productive biological assets Other non-current liabilities
Gas & petrol Total of non-current liabilities 47,056,257.65 47,524,406.51
Use right assets 3,449,628.07 8,030,919.38 Total liabilities 1,059,542,142.56 1,493,647,349.36
Intangible assets 1,266,785.86 1,200,848.82 Owner's equity:
Among them: data resources Share capital 1,073,874,227.00 1,073,874,227.00
R&D expense Other equity tools
Among them: data resources Including: preferred stock
Goodwill Perpetual bond
Long-term amortizable expenses 104,570.72 285,478.52 Capital reserves 360,835.52 360,835.52
Deferred income tax assets Less: Shares in stock
Other non-current assets Other miscellaneous income 39,731,740.46 39,731,740.46
Total of non-current assets 2,162,898,357.63 2,123,912,597.40 Special reserves
Surplus reserve 85,368,328.00 83,974,716.22
Undistributed profit 1,064,139,847.33 1,105,291,052.65
Total of owners' equity 2,263,474,978.31 2,303,232,571.85
Total of liabilities and owner's
Total of assets 3,323,017,120.87 3,796,879,921.21 3,323,017,120.87 3,796,879,921.21
interest
Legal representative: CFO: Accounting firm manager:
Income Statement of the Parent Company
Prepared by: China Fangda Group Co., Ltd. In RMB
Item Note 2025 2024
Less: Operation cost XVI. 4 8,267.66 81,137.33
Taxes and surcharges 1,265,967.33 1,424,024.13
Sales expense
Administrative expense 26,399,191.80 32,460,638.60
R&D cost
Financial expenses -432,824.87 4,841,621.43
Including: interest cost 218,784.11 4,405,563.35
Interest income 580,933.35 260,151.97
Add: other gains 58,615.83 108,256.72
Investment gains ("-" for loss) XVI. 5 25,676,162.22 72,929,550.62
Incl. Investment gains from affiliates and joint ventures
Financial assets derecognized as a result of amortized cost
Net open hedge gains ("-" for loss)
Gains from change of fair value ("-" for loss) -4,092,950.00 -4,092,950.00
Credit impairment ("-" for loss) -80,044.21 -238,257.79
Investment impairment loss ("-" for loss)
Investment gains ("-" for loss) 32,377.91 1,053,415.23
Plus: non-operational income 6,681.45 5,025.67
Less: non-operational expenditure 844.46 24,170.61
Less: Income tax expenses 3,419,278.63 -3,818,332.48
(1) Other misc. incomes that cannot be re-classified into gain and loss - -
(2) Other misc. incomes that will be re-classified into gain and loss - 28,392,754.08
under the equity method
financial assets
Legal representative: CFO: Accounting firm manager:
Note: For companies that prepare consolidated statements of income, only basic and diluted earnings per share on a consolidated basis need to be
calculated and presented, and basic and diluted earnings per share on a parent company basis need not be calculated and presented.
Cash Flow Statement of the Parent Company
Prepared by: China Fangda Group Co., Ltd. In RMB
Item Note 2025 2024
Cash received from sales of products and providing of services 14,964,442.31 23,297,859.17
Tax refunded
Other cash received from business operation 846,127,900.09 1,444,921,260.13
Sub-total of cash inflow from business operations 861,092,342.40 1,468,219,119.30
Cash paid for purchasing products and services 3,632,374.00 3,898,051.28
Cash paid to and for the staff 15,288,292.77 17,406,198.35
Taxes paid 2,276,582.56 2,519,884.87
Other cash paid for business activities 734,330,454.16 991,774,056.35
Sub-total of cash outflow from business operations 755,527,703.49 1,015,598,190.85
Cash flow generated by business operations, net 105,564,638.91 452,620,928.45
Cash received from investment recovery 38,000,000.00 235,323,000.00
Cash received as investment profit 25,679,051.34 72,929,550.62
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets
Net cash received from disposal of subsidiaries or other operational units
Other investment-related cash received
Sub-total of cash inflow generated from investment 63,679,051.34 308,252,550.62
Cash paid for construction of fixed assets, intangible assets and other long-term assets 426,033.24 508,802.14
Cash paid as investment 87,500,000.00 365,554,277.00
Net cash paid for acquiring subsidiaries and other operational units
Other cash paid for investment
Subtotal of cash outflows 87,926,033.24 366,063,079.14
Cash flow generated by investment activities, net -24,246,981.90 -57,810,528.52
Cash received from investment
Cash received from borrowed loans
Other cash received from financing activities -
Subtotal of cash inflow from financing activities - -
Cash paid to repay debts 300,000,000.00
Cash paid as dividend, profit, or interests 53,693,711.35 90,940,972.34
Other cash paid for financing activities 52,842,009.56 4,061,076.00
Subtotal of cash outflow from financing activities 106,535,720.91 395,002,048.34
Net cash flow generated by financing activities -106,535,720.91 -395,002,048.34
Plus: Balance of cash and cash equivalents at the beginning of term 45,501,906.05 45,676,194.32
Legal representative: CFO: Accounting firm manager:
Statement of Change in Owners' Equity (Parent Company)
Prepared by: China Fangda Group Co., Ltd. In RMB
Other equity tools Other
Item Capital Less: Shares in
Share capital Preferred miscellaneous Special reserves Surplus reserve Undistributed profit Total of owners' equity
Perpetual bond Others reserves stock
share income
Add: Changes in accounting policies -
Correction of previous errors -
Others -
(1) Total of misc. incomes - 13,936,117.81 13,936,117.81
(2) Investment or decreasing of capital by owners - - - - - - - - - - -
holders
equity
(3) Profit allotment - - - - - - - - 1,393,611.78 -55,087,323.13 -53,693,711.35
(4) Internal carry-over of owners' equity - - - - - - - - - - -
(5) Special reserves - - - - - - - - - - -
(6) Others -
IV. Closing balance 1,073,874,227.00 - - - 360,835.52 - 39,731,740.46 - 85,368,328.00 1,064,139,847.33 2,263,474,978.31
Legal representative: CFO: Accounting firm manager:
Statement of Change in Owners' Equity (Parent Company)
Prepared by: China Fangda Group Co., Ltd. In RMB
Other equity tools Other
Item Capital Less: Shares in
Share capital Preferred miscellaneous Special reserves Surplus reserve Undistributed profit Total of owners' equity
Perpetual bond Others reserves stock
share income
Add: Changes in accounting policies -
Correction of previous errors -
Others -
(1) Total of misc. incomes 28,392,754.08 57,284,200.15 85,676,954.23
(2) Investment or decreasing of capital by owners - - - - - - - - - - -
holders
equity
(3) Profit allotment - - - - - - - - 5,728,420.02 -91,638,358.18 -85,909,938.16
(4) Internal carry-over of owners' equity - - - - - - 21,421,931.75 - -1,078,644.23 -20,343,287.52 -
(5) Special reserves - - - - - - - - - - -
(6) Others -
IV. Closing balance 1,073,874,227.00 - - - 360,835.52 - 39,731,740.46 - 83,974,716.22 1,105,291,052.65 2,303,232,571.85
Legal representative: CFO: Accounting firm manager:
China Fangda Group Co., Ltd. Notes to Financial Statements
China Fangda Group Co., Ltd.
Notes to Financial Statements
(Unless otherwise specified)
I. Company's profile
China Fangda Group Co., Ltd. (hereinafter referred to as "the Company" or "the
Company") was restructured and established in October 1995 through a public offering, based
on the former "Shenzhen Fangda Building Materials Co., Ltd.", pursuant to the approval
document No. Shen Fu Ban Han [1995] No. 194 issued by the General Office of Shenzhen
Municipal People's Government. The unified social credit code is: 91440300192448589C;
registered address: Fangda Technology Building, Keji South 12th Road, South District,
High-tech Industrial Park, Nanshan District, Shenzhen. Mr. Xiong Jianming is the legal
representative.
The Company issued foreign currency shares (B shares) and local currency shares (A
shares) and listed in November 1995 and April 1996 respectively in Shenzhen Stock
Exchange. The Company received the Reply to the Non-public Share Issuance of Fangda
China Group Co., Ltd. (CSRC License [2016] No.825) to allow the Company to conduct
non-public issuance of 32,184,931 A-shares in June 2016. According to the profit distribution
plan for 2016 approved by the 2016 general shareholders' meeting, the Company issued five
shares for every ten shares to all shareholders through surplus capitalization based on the total
RMB 1,183,642,254.00. The Company repurchased and cancelled 28,160,568.00 B shares in
August 2018, 32,097,497.00 B shares in January 2019, 35,105,238.00 B shares in May 2020,
capital is RMB1,073,874,227.00 yuan.
The Company has established the corporate governance structure of the General Meeting
of Shareholders and the Board of Directors. At present, it has set up the President's Office, the
Administration Department, the Human Resources Department, the Enterprise Management
Department, the Finance Department, the Audit and Supervision Department, the Securities
Department, the Legal Department, the Information Management Department, the Technology
China Fangda Group Co., Ltd. Notes to Financial Statements
Innovation Department, and other departments, and has Shenzhen Fangda Construction
Technology Group Co., Ltd. (hereinafter referred to as Fangda Construction Technology Co.,
Ltd.) Fangda Zhiyuan Technology Co., Ltd. (hereinafter referred to as Fangda Zhiyuan
Technology Co., Ltd.), Fangda Jiangxi New Materials Co., Ltd., Fangda Real Estate Co., Ltd.,
Fangda New Energy Co., Ltd. and other subsidiaries.
The business nature and main business activities of the Company and its subsidiaries
include: (1) curtain wall division, production and sales of curtain wall materials, design,
production and installation of building curtain walls, and curtain wall testing and maintenance
services; (2) Rail transit branch, assembly and processing of subway screen doors, screen door
detection and maintenance services; (3) The real estate division is engaged in real estate
development, operation and property leasing and property management services on the land
that has legally obtained the right to use; (4) New energy division, photovoltaic power
generation and sales; R&D, installation and sales of photovoltaic equipment, design and
installation of photovoltaic power station project.
Date of financial statement approval: This financial statement is approved by the Board
of Directors of the Company on April 03, 2026.
II. Basis for the preparation of financial statements
The Company prepares the financial statements based on continuous operation and
according to actual transactions and events, with figures confirmed and measured in
compliance with the Accounting Standards for Business Enterprises and other specific
account standards, application guide and interpretations. The Company has also disclosed
related financial information according to the requirement of the Regulations of Information
Disclosure No.15 – General Provisions for Financial Statements (Revised in 2023) issued by
the CSRC.
The Company assessed the continuing operations capability of the Company for the 12
months from the end of the reporting period. No matters were found that would affect the
Company's ability to continue as a going concern. It is reasonable for the Company to prepare
financial statements based on continuing operations.
III. Significant Account Policies and Estimates
China Fangda Group Co., Ltd. Notes to Financial Statements
The following major accounting policies and accounting estimates shall be formulated in
accordance with the accounting standards of the enterprise. Unmentioned operations are
carried out in accordance with the relevant accounting policies in the enterprise accounting
standards.
These financial statements meet the requirements of the Accounting Standards for
Business Enterprises and truly and fully reflect the Company's financial status, performance
result, changes in shareholders' equity and cash flows.
The accounting period of the Company is from January 1 to December 31 of each
calendar year.
Our normal business cycle is one year
The Company's bookkeeping standard currency is Renminbi, and overseas subsidiaries
are based on the currency of the main economic environment in which they operate.
Item Importance criteria
Amount of bad debt reserves recovered or Amount greater than 5% of the total consolidated
reversed for important accounts receivable in the profit and greater than RMB5 million
current period; important accounts receivable (If the data is negative, its absolute value shall be
write off used.)
Amount greater than 1% of total consolidated net
Important ongoing projects
assets
A single project is greater than 0.1% of the combined
Important payables with an aging of over 1 year
total assets
Individual net assets greater than 1% of the total
Major non wholly-owned subsidiaries
consolidated net assets
Investment income exceeding 5% of the consolidated
Important joint ventures and associates total profit and greater than RMB5 million (if the
amount is negative, its absolute value is used)
(1) Consolidation of entities under common control
The assets and liabilities acquired by the Company in a business combination are
measured at the book value of the combined party in the consolidated financial statements of
China Fangda Group Co., Ltd. Notes to Financial Statements
the ultimate controlling party on the date of combination. Where the combined party applied
different accounting policies and accounting periods from those of the Company prior to the
business combination, such policies and periods have been harmonized based on the
materiality principle—specifically, the carrying amounts of the combined party's assets and
liabilities have been adjusted in accordance with the Company's accounting policies and
accounting periods. If there is a difference between the book value of the net assets acquired
by the Company in the business combination and the book value of the consideration paid,
first adjust the balance of the capital reserve (capital premium or equity premium), the balance
of the capital reserve (capital premium or equity premium) If it is insufficient to offset, the
surplus reserve and undistributed profits will be offset in sequence.
See Note 3, 7 (6) for the accounting treatment method of business combination under the
same control through step-by-step transaction.
(2) Consolidation of entities under different control
All identifiable assets and liabilities acquired by the Company during the merger shall be
measured at its fair value on the date of purchase. Where the acquiree applied different
accounting policies and accounting periods from those of the Company prior to the business
combination, such policies and periods have been harmonized based on the materiality
principle—specifically, the carrying amounts of the acquiree's assets and liabilities have been
adjusted in accordance with the Company's accounting policies and accounting periods. The
merger cost of the Company on the date of purchase is greater than the fair value of the assets
and liabilities recognized by the purchaser in the merger, and is recognized as goodwill. If the
merger cost is less than the difference between the identifiable assets and the fair value of the
liabilities obtained by the purchaser in the enterprise merger, the merger cost and the fair
value of the identifiable assets and the liabilities obtained by the purchaser in the enterprise
merger are reviewed, and the merger cost is still less than the fair value of the identifiable
assets and liabilities obtained by the purchaser after the review, the difference is considered as
the profit and loss of the current period of the merger.
See Note 3, 7 (6) for the accounting treatment method of business combination under the
same control through step-by-step transaction.
(3) Treatment of related transaction fee in enterprise merger
Agency expenses and other administrative expenses such as auditing, legal consulting, or
China Fangda Group Co., Ltd. Notes to Financial Statements
appraisal services occurred relating to the merger of entities are accounted into current income
account when occurred. The transaction fees of equity certificates or liability certificates
issued by the purchaser for payment for the acquisition are accounted at the initial amount of
the certificates.
financial statements
(1) Determination of control criteria and consolidation scope
Control means the power possessed by the Company on invested entities to share
variable returns by participating in related activities of the invested entities and to impact the
amount of the returns by using the power. The definition of control includes three basic
elements: first, the investor has the power over the investee; second, enjoys variable returns
due to participation in the investee's related activities; and third, has the ability to use the
power over the investee to influence its return amount. When the Company's investment in
the invested party meets the above three elements, it indicates that the Company can control
the invested party.
The consolidated scope of the consolidated financial statements is determined on a
control basis and includes not only subsidiaries determined on the basis of voting rights (or
similar voting rights) themselves or in conjunction with other arrangements, but also
structured subjects determined on the basis of one or more contractual arrangements.
The subsidiary company is the subject controlled by the Company (including the
enterprise, the divisible part of the invested unit and the structured subject controlled by the
enterprise, etc.). The structured subject is the subject which is not designed to determine the
controlling party by taking the voting right or similar right as the decisive factor.
(2) Special provisions regarding the parent company being an investment entity
If the parent company is an investment entity, only those subsidiary companies that
provide services related to investment activities of the investment entity shall be included in
the consolidation scope. Other subsidiary companies shall not be consolidated and their equity
investments shall be recognized as financial assets measured at fair value with changes in fair
value recognized in profit or loss.
The parent company qualifies as an investment entity when it simultaneously meets the
China Fangda Group Co., Ltd. Notes to Financial Statements
following conditions:
① The company obtains funds from one or more investors with the purpose of
providing investment management services to the investors.
② The sole purpose of the company's operations is to generate returns for the investors
through capital appreciation, investment income, or both.
③ The company evaluates and assesses the performance of almost all of its investments
based on fair value.
When the parent company changes from a non-investment entity to an investment entity,
it shall only include those subsidiary companies that provide relevant services for its
investment activities in the preparation of consolidated financial statements. Other subsidiary
companies shall no longer be consolidated, and the principle of recognizing partially disposed
subsidiary companies' equity while retaining control shall be applied.
When the parent company changes from an investment entity to a non-investment entity,
the subsidiary companies that were previously not included in the consolidation financial
statements shall be included as of the date of the change. The fair value of these subsidiary
companies on the date of the change shall be regarded as the transaction price of the
acquisition and accounted for using the accounting treatment for business combinations under
common control.
(3) Preparation of Consolidated Financial Statements
The Company prepares consolidated financial statements based on the financial
statements of itself and its subsidiaries and based on other relevant information.
The Company compiles consolidated financial statements, regards the whole enterprise
group as an accounting entity, reflects the overall financial status, operating results and cash
flow of the enterprise group according to the confirmation, measurement and presentation
requirements of the relevant enterprise accounting standards, and the unified accounting
policy and accounting period.
① Merge the assets, liabilities, owner's rights and interests, income, expenses and cash
flow of parent company and subsidiary company.
② Offset the long-term equity investment of the parent company to the subsidiary
China Fangda Group Co., Ltd. Notes to Financial Statements
company and the share of the parent company in the ownership rights of the subsidiary
company.
③ Offset the influence of internal transaction between parent company, subsidiary
company and subsidiary company. If an internal transaction indicates that the relevant asset
has suffered an impairment loss, the part of the loss shall be confirmed in full.
④ adjust the special transaction from the angle of enterprise group.
(4) Processing of subsidiaries during the reporting period
① Increase of subsidiaries or business
A. Subsidiary or business increased by business combination under the same control
(A) When preparing the consolidated balance sheet, adjust the opening number of the
consolidated balance sheet and adjust the related items of the comparative statement. The
same report entity as the consolidated balance sheet will exist from the time of the final
control party.
(B) When preparing the consolidated cash flow statement, the cash flows of the
subsidiary and the business combination from the beginning of the current period to the end
of the reporting period are included in the consolidated cash flow statement, and the related
items of the comparative statement are adjusted, which is regarded as the combined report
body since the final The controller has been there since the beginning of control.
(C) When preparing the consolidated cash flow statement, the cash flows of the
subsidiary and the business combination from the beginning of the current period to the end
of the reporting period are included in the consolidated cash flow statement, and the related
items of the comparative statement are adjusted, which is regarded as the combined report
body since the final The controller has been there since the beginning of control.
B. Subsidiary or business increased by business combination under the same control
(A) When preparing the consolidated balance sheet, the opening number of the
consolidated balance sheet is not adjusted.
(B) When preparing the consolidated profit statement, the income, expense and profit of
the subsidiary company and the business Purchase date and Closing balance shall be included
in the consolidated profit statement.
China Fangda Group Co., Ltd. Notes to Financial Statements
(C) When the consolidated cash flow statement is prepared, the cash flow from the
purchase date of the subsidiary to the end of the reporting period is included in the
consolidated cash flow statement.
② Disposal of subsidiaries or business
A. When preparing the consolidated balance sheet, the opening number of the
consolidated balance sheet is not adjusted.
B. When preparing the consolidated profit statement, the income, expense and profit of
the subsidiary company and the business opening and disposal date shall be included in the
consolidated profit statement.
C. When the consolidated cash flow statement is prepared, the cash flow from the
Beginning of the period of the subsidiary to the end of the reporting period is included in the
consolidated cash flow statement.
(5) Special considerations in consolidation offsets
① The long-term equity investment held by a subsidiary company shall be regarded as
the inventory shares of the company as a subtraction of the owner's rights and interests, which
shall be listed under the item of "subtraction: Stock shares" under the item of owner's rights
and interests in the consolidated balance sheet.
The long-term equity investments held by the subsidiaries are offset by the shares of the
shareholders of the subsidiaries.
② The "special reserve" and "general risk preparation" projects, because they are
neither real capital (or share capital) nor capital reserve, but also different from the retained
income and undistributed profits, are restored according to the ownership of the parent
company after the long-term equity investment is offset by the ownership rights and interests
of the subsidiary company.
③ If there is a temporary difference between the book value of assets and liabilities in
the consolidated balance sheet and the taxable basis of the taxpayer due to the offset of the
unrealized internal sales gain or loss, the deferred income tax asset or the deferred income tax
liability is confirmed in the consolidated balance sheet, and the income tax expense in the
consolidated profit statement is adjusted, with the exception of the deferred income tax related
to the transaction or event directly included in the owner's equity and the merger of the
China Fangda Group Co., Ltd. Notes to Financial Statements
enterprise.
④ The unrealized internal transaction gains and losses incurred by the company from
selling assets to subsidiaries shall be fully offset against the "net profit attributable to the
owners of the parent company". The unrealized internal transaction gains and losses arising
from the sale of assets by the subsidiary to the Company shall be offset between the "net
profit attributable to the owners of the parent company" and the "minority shareholder gains
and losses" in accordance with the Company's distribution ratio to the subsidiary. The
unrealized internal transaction gains and losses arising from the sale of assets between
subsidiaries shall be offset between the "net profit attributable to the owners of the parent
company" and the "minority shareholders' gains and losses" in accordance with the
Company's distribution ratio to the seller's subsidiary .
⑤ If the current loss shared by the minority shareholders of the subsidiary exceeds the
share of the minority shareholders in the owner 's equity of the subsidiary at the beginning of
the period, the balance should still be offset against the minority shareholders 'equity.
(6) Accounting treatment of special transactions
① Purchase minority shareholders' equity
The Company purchases the shares of the subsidiaries owned by the minority
shareholders of the subsidiaries. In the individual financial statements, the investment costs of
the newly acquired long-term investments of the minority shares shall be measured at the fair
value of the price paid. In the consolidated financial statements, the difference between the
newly acquired long-term equity investment due to the purchase of minority equity and the
share of net assets that should be continuously calculated by the subsidiary since the purchase
date or the merger date should be adjusted according to the new shareholding ratio. The
product (capital premium or equity premium), if the capital reserve is insufficient to offset, the
surplus reserve and undistributed profits are offset in turn.
② Step-by-step acquisition of control of the subsidiary through multiple transactions
A. Enterprise merger under common control through multiple transactions
On the date of the merger, the Company determines the initial investment cost of the
long-term equity investment in the individual financial statements based on the share of the
subsidiary 's net assets that should be enjoyed after the merger in the final controller 's
China Fangda Group Co., Ltd. Notes to Financial Statements
consolidated financial statements; the initial investment cost and the The difference between
the book value of the long-term equity investment before the merger plus the book value of
the consideration paid for new shares acquired on the merger date, the capital reserve (capital
premium or equity premium) is adjusted, and the capital reserve (capital premium or equity
premium) is insufficient to offset Reduced, in turn offset the surplus reserve and undistributed
profits.
In consolidated financial statements, assets and liabilities obtained by the merging party
from the merged party should be measured at the book value in the final controlling party's
consolidated financial statements other than the adjustment made due to differences in
accounting policies; adjust the capital surplus (share premium) according to the difference
between the initial investment cost and the book value of the held investment before merger
plus the book value of the consideration paid on the merger date. Where the capital surplus
falls short, the retained income should be adjusted.
Before the acquirer obtains control of the acquiree, any recognized gains and losses,
other comprehensive income, and changes in other owners' equity related to the equity
investment held by the acquirer from the later of the date when the original equity was
obtained or the date when both the acquirer and the acquiree were under the control of the
same party until the acquisition date should be adjusted against the beginning retained
earnings or the current profits and losses of the comparative statements separately.
A. Enterprise merger under common control through multiple transactions
On the merger day, in individual financial statements, the initial investment cost of the
long-term equity investment on the merger day is based on the book value of the long-term
equity investment previously held plus the sum of the additional investment costs on the
merger day.
In the consolidated financial statements, the equity held in the acquiree before the
acquisition date is remeasured at its fair value on the acquisition date. If the equity held before
the acquisition date is designated as a financial asset measured at fair value through other
comprehensive income, the difference between the fair value and its book value is included in
retained earnings, and the cumulative fair value changes previously included in other
comprehensive income are transferred to retained earnings. If the equity held before the
acquisition date is designated as a financial asset measured at fair value through profit or loss
China Fangda Group Co., Ltd. Notes to Financial Statements
or as a long-term equity investment accounted for by the equity method, the difference
between the fair value and its book value is included in the current period's investment
income. For other comprehensive income and other changes in owners' equity under the
equity method related to the equity held before the acquisition date, the related other
comprehensive income is accounted for on the same basis as if the investee had directly
disposed of the related assets or liabilities on the acquisition date, and the related other
changes in owners' equity are transferred to the current period's investment income on the
acquisition date.
(3) The Company disposes of long-term equity investment in subsidiaries without losing
control
The parent company partially disposes of the long-term equity investment in the
subsidiary company without losing control. In the consolidated financial statements, the
disposal price corresponds to the disposal of the long-term equity investment. The difference
between the shares is adjusted for the capital reserve (capital premium or equity premium). If
the capital reserve is insufficient to offset, the retained earnings are adjusted.
④ The company disposes of long-term equity investment in subsidiaries and loses
control
A. One transaction disposition
If the Company loses control over the Invested Party due to the disposal of part of the
equity investment, it shall remeasure the remaining equity according to its fair value at the
date of loss of control when compiling the consolidated financial statement. The consideration
received from the disposal of equity plus the fair value of the remaining equity, minus the
share of net assets and goodwill calculated based on the original shareholding ratio from the
acquisition date or combination date to the disposal date, is included in the investment income
for the period in which control is lost.
Other comprehensive income related to equity investments in former subsidiaries is
accounted for, upon loss of control, on the same basis as if the related assets or liabilities of
the former subsidiary were directly disposed of. Other changes in owners' equity related to
former subsidiaries that were previously recognized under the equity method are reclassified
to profit or loss in the period in which control is lost.
B. Multi-transaction step-by-step disposition
China Fangda Group Co., Ltd. Notes to Financial Statements
In consolidated financial statements, you should first determine whether a step-by-step
transaction is a "blanket transaction".
If the step-by-step transaction does not belong to a "package deal", in the individual
financial statements, for each transaction before the loss of control of the subsidiary, the book
value of the long-term equity investment corresponding to each disposal of equity is carried
forward, the price received and the disposal The difference between the book value of the
long-term equity investment is included in the current investment income; in the consolidated
financial statements, it should be handled in accordance with the relevant provisions of "the
parent company disposes of the long-term equity investment in the subsidiary without losing
control."
If a step-by-step transaction belongs to a "blanket transaction", the transaction shall be
treated as a transaction that disposes of the subsidiary and loses control; In individual
financial statements, the difference between each disposal price before the loss of control and
the book value of the long-term equity investment corresponding to the equity being disposed
of is first recognized as other consolidated gains and then converted to the current loss of
control at the time of the loss of control; In the consolidated financial statements, for each
transaction prior to the loss of control, the difference between the disposition of the price and
the disposition of the investment corresponding to the share in the net assets of the subsidiary
shall be recognized as other consolidated gains and shall, at the time of the loss of control, be
transferred to the loss of control for the current period.
Where the terms, conditions, and economic impact of each transaction meet one or more
of the following conditions, usually multiple transactions are treated as a "package deal":
(a) These transactions were concluded at the same time or in consideration of mutual
influence.
(b) These transactions can only achieve the business result as a whole;
(c) The effectiveness of one transaction depends the occurrence of at least another
transaction;
(d) A single transaction is not economic and is economic when considered together with
other transactions.
(5) Proportion of minority shareholders in factor companies who increase capital and
China Fangda Group Co., Ltd. Notes to Financial Statements
dilute ownership of parent companies
Proportion of Others ( minority shareholders in factor companies who increase capital ,
dilute Subsidiaries of parent companies. In the consolidated financial statements, the share of
the parent company in the net book assets of the former subsidiary of the capital increase is
calculated according to the share ratio of the parent company before the capital increase, the
difference between the share and the net book assets of the latter subsidiary after the capital
increase is calculated according to the share ratio of the parent company, the capital reserve
(capital premium or capital premium), the capital reserve (capital premium or capital premium)
is not offset, and the retained income is adjusted.
Operations
A joint arrangement is an arrangement jointly controlled by two or more participants.
The Company classifies its joint arrangements into joint operations and joint ventures.
(1) Joint Operations
A joint operation is a joint arrangement whereby the Company has rights to the related
assets and obligations for the related liabilities of the arrangement.
The Company recognizes the following items relating to its interest in a joint operation
and accounts for them in accordance with the relevant enterprise accounting standards:
① Recognizes assets held separately, as well as its share of jointly held assets;
② Recognizes liabilities borne separately, as well as its share of jointly borne liabilities;
③ Recognizes revenue from the sale of its share of output from the joint operation;
④ Recognizes its share of revenue generated by the joint operation from the sale of
output;
⑤ Recognizes expenses incurred separately, as well as its share of expenses incurred by
the joint operation.
(2) Joint Ventures
A joint venture is a joint arrangement whereby the Company has rights only to the net
assets of the arrangement.
China Fangda Group Co., Ltd. Notes to Financial Statements
The Company accounts for its investment in joint ventures using the equity method in
accordance with the relevant provisions on long-term equity investments.
Cash refers to cash in stock and deposits that can be used for payment at any time. Cash
equivalents refer to investments with a short holding period (generally referring to expiry
within three months from the date of purchase), strong liquidity, easy to convert to a known
amount of cash, and little risk of value change.
(1) Methods for determining conversion rates in foreign currency transactions
The Company translates foreign currency transactions into the functional currency at the
initial recognition using the spot exchange rate on the transaction date or an approximate
exchange rate that is determined according to a reasonable method and is close to the spot
exchange rate on the transaction date. The resulting amount is recorded in the accounting
currency.
(2) Methods of conversion of foreign currency currency currency items on balance
sheet days
At the balance sheet date, foreign currency items are translated on the spot exchange rate
of the balance sheet date. The exchange differences caused by the difference in exchange rates
on the balance sheet date and initial recognizing date or previous balance sheet date are
included in the current profits and losses. For non-monetary items measured at historical cost
in foreign currencies, they are translated using the spot exchange rate on the transaction date.
For inventories measured at the lower of cost and net realizable value, if the inventories were
purchased in foreign currencies and their net realizable value is reflected in foreign currencies
as of the balance sheet date, the net realizable value is first translated into the functional
currency at the spot exchange rate on the balance sheet date, and then compared with the
inventory cost reflected in the functional currency to determine the ending value of the
inventories. Non-monetary items measured at fair value in foreign currencies are translated
using the spot exchange rate on the date the fair value is determined. For financial assets
measured at fair value with changes recognized in the current period's profit or loss, the
difference between the translated amount in the functional currency and the original amount
in the functional currency is recognized in the current period's profit or loss. For non-trading
China Fangda Group Co., Ltd. Notes to Financial Statements
equity investments designated to be measured at fair value with changes recognized in other
comprehensive income, the difference between the translated amount in the functional
currency and the original amount in the functional currency is recognized in other
comprehensive income.
(3) Translation of foreign exchange statements
Prior to the conversion of the financial statements of an enterprise's overseas operations,
the accounting period and policy of the overseas operations should be adjusted to conform to
the accounting period and policy of the enterprise. The financial statements of the
corresponding currency (other than the functional currency) should be prepared according to
the adjusted accounting policy and the accounting period. The financial statements of the
overseas operations should be converted according to the following methods:
① The assets and liabilities items in the balance sheet are translated at the spot
exchange rate on the balance sheet date. Except for the "undistributed profits" items, the
owner's equity items are translated at the spot exchange rate when they occur.
② The income and expense items in the profit statement are converted at the spot
exchange rate on the transaction date or the approximate exchange rate of the spot exchange
rate.
③ The foreign currency cash flow and the foreign subsidiary's cash flow are converted
using the immediate exchange rate or the approximate exchange rate at the date of the cash
flow. The impact of exchange rate changes on cash should be used as an adjustment item and
presented separately in the cash flow statement.
④ The foreign currency translation differences arising are presented under the "Other
Comprehensive Income" item in the shareholders' equity section of the consolidated balance
sheet when preparing the consolidated financial statements.
When foreign operations are disposed of and the control rights are lost, the difference in
foreign currency statements related to the overseas operations that are listed in the
shareholders' equity items in the balance sheet is transferred to the profit or loss for the
current period, either in whole or in proportion to the disposal of the foreign operations.
Financial instrument refers to a company's financial assets and contracts that form other
China Fangda Group Co., Ltd. Notes to Financial Statements
units of financial liabilities or equity instruments.
(1) Recognition and de-recognition of financial instrument
The Company recognizes a financial asset or liability when it becomes one party in the
financial instrument contract.
Financial asset is derecognized when:
① The contractual right to receive the cash flows of the financial assets is terminated;
② The financial asset is transferred and meets the following derecognization condition.
If the current obligation of a financial liability (or part of it) has been discharged, the
Company derecognises the financial liability (or part of the financial liability). When the
Company (borrower) and lender enter into an agreement to replace the original financial
liabilities by undertaking new financial liabilities and the contract terms for the new financial
liabilities are essentially different from those for the original one, the original financial
liabilities will be derecognized and new financial liabilities will be recognized. Where the
Company makes substantial amendments to the contract terms of the original financial
liability (or part thereof), it shall terminate the original financial liability and confirm a new
financial liability in accordance with the amended terms.
Financial asset transactions in regular ways are recognized and de-recognized on the
transaction date. The conventional sale of financial assets means the delivery of financial
assets in accordance with the contractual terms and conditions, at the time set out in the
regulations or market practices. Transaction date refers to the date when the Company
promises to buy or sell financial assets.
(2) Classification and subsequent measurement of financial assets
At initial recognition, the Company classifies financial assets into the following three
categories based on the business model of managing financial assets and the contractual cash
flow characteristics of financial assets: financial assets measured at amortized cost are
measured at fair value and their changes are included in other financial assets with current
profit and loss and financial assets measured at fair value through profit or loss. Unless the
Company changes the business model for managing financial assets, in this case, all affected
financial assets are reclassified on the first day of the first reporting period after the business
model changes, otherwise the financial assets may not be initially confirmed.
China Fangda Group Co., Ltd. Notes to Financial Statements
Financial assets are measured at the fair value at the initial recognition. For financial
assets measured at fair value with variations accounted into current income account, related
transaction expenses are accounted into the current income. For other financial assets, the
related transaction expenses are accounted into the initial recognized amounts. Bills
receivable and accounts receivable arising from the sale of commodities or the provision of
labor services that do not contain or do not consider significant financing components, the
Company performs initial measurement according to the transaction price defined by the
income standard.
The subsequent measurement of financial assets depends on their classification:
① Financial assets measured at amortized cost
Financial assets that meet the following conditions at the same time are classified as
financial assets measured at amortized cost: The Company 's business model for managing
this financial asset is to collect contractual cash flows as its goal; the contract terms of the
financial asset stipulate that Cash flow is only the payment of principal and interest based on
the outstanding principal amount. For such financial assets, the actual interest rate method is
used for subsequent measurement according to the amortized cost. The gains or losses arising
from the termination of recognition, amortization or impairment based on the actual interest
rate method are included in the current profit and loss.
② Financial assets measured at fair value and whose changes are included in other
comprehensive income
Financial assets that meet the following conditions at the same time are classified as
financial assets measured at fair value and their changes are included in other comprehensive
income: The Company's business model for managing this financial asset is to both target the
collection of contractual cash flows and the sale of financial assets. Objective; The contractual
terms of the financial asset stipulate that the cash flow generated on a specific date is only for
the payment of principal and interest based on the outstanding principal amount. For such
financial assets, fair value is used for subsequent measurement. Except for impairment losses
or gains and exchange gains and losses recognized as current gains and losses, changes in the
fair value of such financial assets are recognized as other comprehensive income. Until the
financial asset is derecognized, its accumulated gains or losses are transferred to current gains
and losses. However, the relevant interest income of the financial asset calculated by the
China Fangda Group Co., Ltd. Notes to Financial Statements
actual interest rate method is included in the current profit and loss.
The Company irrevocably chooses to designate a portion of non-tradable equity
instrument investment as a financial asset measured at fair value and whose variation is
included in other consolidated income. Only the relevant dividend income is included in the
current profit and loss, and the variation of fair value is recognized as other consolidated
income.
③ Financial assets measured at fair value with variations accounted into current income
account
The above financial assets measured at amortized cost and other financial assets
measured at fair value and whose changes are included in other comprehensive income are
classified as financial assets measured at fair value and whose changes are included in the
current profit and loss. For such financial assets, fair value is used for subsequent
measurement, and all changes in fair value are included in current profit and loss.
(3) Classification and measurement of financial liabilities
The Company classifies financial liabilities into financial liabilities measured at fair
value and their changes included in the current profit and loss, loan commitments and
financial guarantee contract liabilities for loans below market interest rates, and financial
liabilities measured at amortized cost.
The subsequent measurement of financial liabilities depends on their classification:
① Financial liabilities measured at fair value with variations accounted into current
income account
Such financial liabilities include transactional financial liabilities (including derivatives
that are financial liabilities) and financial liabilities designated as at fair value through profit
or loss. After the initial recognition, the financial liabilities are subsequently measured at fair
value. Except for the hedge accounting, the gains or losses (including interest expenses) are
recognized in profit or loss. However, for the financial liabilities designated as fair value and
whose variations are included in the profits and losses of the current period, the variable
amount of the fair value of the financial liability due to the variation of credit risk of the
financial liability shall be included in the other consolidated income. When the financial
liability is terminated, the cumulative gains and losses previously included in the other
China Fangda Group Co., Ltd. Notes to Financial Statements
consolidated income shall be transferred out of the other consolidated income and shall be
included in the retained income.
② Loan commitments and financial security contractual liabilities
A loan commitment is a promise that the Company provides to customers to issue loans
to customers with established contract terms within the commitment period. Loan
commitments are provided for impairment losses based on the expected credit loss model.
A financial guarantee contract refers to a contract that requires the Company to pay a
specific amount of compensation to the contract holder who suffered a loss when a specific
debtor is unable to repay the debt in accordance with the original or modified debt instrument
terms. Financial guarantee contract liabilities are subsequently measured based on the higher
of the loss reserve amount determined in accordance with the principle of impairment of
financial instruments and the initial recognition amount after deducting the accumulated
amortization amount determined in accordance with the revenue recognition principle.
③ Financial liabilities measured at amortized cost
After initial recognition, other financial liabilities are measured at amortized cost using
the effective interest method.
Except in special circumstances, financial liabilities and equity instruments are
distinguished according to the following principles:
① If the Company cannot unconditionally avoid delivering cash or other financial assets
to fulfill a contractual obligation, the contractual obligation meets the definition of financial
liability. While some financial instruments do not explicitly contain terms and conditions for
the delivery of cash or other financial assets, they may indirectly form contractual obligations
through other terms and conditions.
If a financial instrument is required to be settled with or can be settled with the
Company's own equity instruments, the Company's own equity instrument used to settle the
instrument needs to be considered as a substitute for cash or other financial assets or for the
holder of the instrument to enjoy the remaining equity in the assets after all liabilities are
deducted. If it is the former, the instrument is the financial liabilities of the issuer; if it is the
latter, the instrument is the equity instrument of the issuer. In some cases, a financial
instrument contract provides that the Company shall or may use its own instrument of interest,
China Fangda Group Co., Ltd. Notes to Financial Statements
in which the amount of a contractual right or obligation is equal to the amount of the
instrument of its own interest which may be acquired or delivered multiplied by its fair value
at the time of settlement, whether the amount of the contractual right or obligation is fixed or
is based entirely or in part on a variation of a variable other than the market price of the
instrument of its own interest, such as the rate of interest, the price of a commodity or the
price of a financial instrument, the contract is classified as a financial liability.
(4) Derivative financial instruments and embedded derivatives
Derivative financial instruments are initially measured at the fair value of the day when
the derivative transaction contract is signed, and are subsequently measured at their fair
values. Derivative financial instruments with a positive fair value are recognized as asset, and
instruments with a negative fair value are recognized as liabilities.
The gains and losses arising from the change in fair value of derivatives are directly
included in the profits and losses of the current period, except that the part of the cash flow
that is valid in the hedge is included in the other consolidated income and transferred out
when the hedged item affects the gain and loss of the current period.
For a hybrid instrument containing an embedded derivative instrument, if the principal
contract is a financial asset, the hybrid instrument as a whole applies the relevant provisions
of the financial asset classification. If the main contract is not a financial asset, and the hybrid
instrument is not measured at fair value and its changes are included in the current profit and
loss for accounting, the embedded derivative does not have a close relationship with the main
contract in terms of economic characteristics and risks, and it is If the instruments with the
same conditions and exist separately meet the definition of derivative instruments, the
embedded derivative instruments are separated from the mixed instruments and treated as
separate derivative financial instruments. If the fair value of the embedded derivative on the
acquisition date or the subsequent balance sheet date cannot be measured separately, the
hybrid instrument as a whole is designated as a financial asset or financial liability measured
at fair value and whose changes are included in the current profit or loss.
(5) Financial instrument Less
The Company shall confirm the preparation for loss on the basis of expected credit loss
for financial assets measured at amortization costs, creditor's rights investments measured at
fair value, contractual assets, leasing receivables, loan commitments and financial guarantee
China Fangda Group Co., Ltd. Notes to Financial Statements
contracts, etc.
① Measurement of expected credit losses of accounts receivable
The expected credit loss refers to the weighted average of the credit losses of financial
instruments that are weighted by the risk of default. Credit loss refers to the difference
between all contractual cash flows receivable from the contract and all cash flows expected to
be received by the Company at the original actual interest rate, that is, the present value of all
cash shortages. Among them, the financial assets which have been purchased or born by the
Company shall be discounted according to the actual rate of credit adjustment of the financial
assets.
The expected lifetime credit loss is the expected credit loss due to all possible default
events during the entire expected life of the financial instrument.
Expected credit losses in the next 12 months are expected to result from possible defaults
in financial instruments within 12 months after the balance sheet date (or estimated duration
of financial instruments if the expected duration is less than 12 months) Credit losses are part
of the expected lifetime credit loss.
On each balance sheet day, the Company measures the expected credit losses of financial
instruments at different stages. Where the credit risk has not increased significantly since the
initial confirmation of the financial instrument, it is in the first stage. The Company measures
the preparation for loss according to the expected credit loss in the next 12 months. Where the
credit risk has increased significantly since the initial confirmation but the credit impairment
has not occurred, the financial instrument is in the second stage. Where a credit impairment
has occurred since the initial confirmation of the financial instrument, it shall be in the third
stage, and the Company shall prepare for measuring the expected credit loss of the whole
survival period of the instrument.
For financial instruments with low credit risk on the balance sheet date, the Company
assumes that the credit risk has not increased significantly since the initial recognition, and
measures the loss provision based on the expected credit losses in the next 12 months.
For financial instruments that are in the first and second stages and with lower credit risk,
the Company calculates interest income based on their book balances and actual interest rates
without deduction for impairment provision. For financial instruments in the third stage,
interest income is calculated based on the amortized cost and the actual interest rate after the
China Fangda Group Co., Ltd. Notes to Financial Statements
book balance minus the provision for impairment.
Regarding bills receivable, accounts receivable and financing receivables, regardless of
whether there is a significant financing component, the Company measures the loss provision
based on the expected credit losses throughout the duration.
Accounts receivable/contract assets
Applicable from December 1, 2025
Where there is objective evidence of impairment, as well as other receivable instruments,
receivables, other receivables, receivables financing and long-term receivables applicable to
individual assessments, separate impairment tests are performed to confirm expected credit
losses and prepare individual impairment. For notes receivable, accounts receivable, other
receivables, financing of receivables, long-term receivables, and contract assets for which
there is no objective evidence of impairment, or when individual financial assets cannot be
assessed at a reasonable cost, the Company divides bills receivable, accounts receivable, other
receivables, receivable financing, long-term receivables, and contract assets into several
combinations based on credit risk characteristics, and calculates expected credit losses on the
basis of the combination. The basis for determining the combination is as follows:
The basis for determining the combination of notes receivable is as follows:
The basis for determining the combination of notes receivable is as follows:
Notes Receivable Combination 1 Commercial Acceptance Bill
Notes Receivable Combination 2 Bank Acceptance Bill
For Notes receivable divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
The basis for determining the combination of accounts receivable is as follows:
Accounts Receivable Portfolio 1: Receivables from curtain wall business
Accounts Receivable Portfolio 2: Receivables from platform screen door business
Accounts Receivable Portfolio 3: Receivables from new materials business
Accounts Receivable Portfolio 4: Receivables from new energy business
China Fangda Group Co., Ltd. Notes to Financial Statements
Accounts Receivable Portfolio 5: Receivables from commercial real estate and others
Other receivable portfolio 6 Receivables from related parties within the scope of
consolidation
For the accounts receivable divided into a combination, the Company refers to the
historical credit loss experience, combined with the current situation and the forecast of the
future economic situation, compiles the account receivable age and the whole expected credit
loss rate table, and calculates the expected credit loss.
The basis for determining the combination of other receivables is as follows:
Other receivable portfolio 1 Interest receivable
Portfolio of other receivables 2 Dividends receivable
Other combinations of receivables 3 Deposit and margin receivable
Other receivable portfolio 4 Receivable advances
Combination of other receivables 5 Value-added tax receivable is increased and refunded
Other receivable portfolio 6 Receivables from related parties within the scope of
consolidation
Other receivables portfolio 7 Other receivables
For other receivables divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
The basis for determining the combination of receivables financing is as follows:
Receivables financing portfolio 1 bank acceptance bill
For Notes receivable divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
The basis for determining the portfolio of contract assets is as follows:
Contract assets portfolio 1 conditional collection right of sales
China Fangda Group Co., Ltd. Notes to Financial Statements
Contract assets portfolio 2 Completed and unsettled project not meeting collection
conditions
Contract assets portfolio 3 Quality guarantee deposit not meeting collection conditions
For contract assets divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
Applicable on and before November 30, 2025
Where there is objective evidence of impairment, as well as other receivable instruments,
receivables, other receivables, receivables financing and long-term receivables applicable to
individual assessments, separate impairment tests are performed to confirm expected credit
losses and prepare individual impairment. For notes receivable, accounts receivable, other
receivables, financing of receivables, long-term receivables, and contract assets for which
there is no objective evidence of impairment, or when individual financial assets cannot be
assessed at a reasonable cost, the Company divides bills receivable, accounts receivable, other
receivables, receivable financing, long-term receivables, and contract assets into several
combinations based on credit risk characteristics, and calculates expected credit losses on the
basis of the combination. The basis for determining the combination is as follows:
The basis for determining the combination of notes receivable is as follows:
Notes Receivable Combination 1 Commercial Acceptance Bill
Notes Receivable Combination 2 Bank Acceptance Bill
For Notes receivable divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
The basis for determining the combination of accounts receivable is as follows:
Accounts receivable combination 1 Accounts receivable business
Accounts receivable combination 2 Real estate receivable business
Accounts receivable combination 3 Others receivable business
China Fangda Group Co., Ltd. Notes to Financial Statements
Other receivable portfolio 4 Receivables from related parties within the scope of
consolidation
For the accounts receivable divided into a combination, the Company refers to the
historical credit loss experience, combined with the current situation and the forecast of the
future economic situation, compiles the account receivable age and the whole expected credit
loss rate table, and calculates the expected credit loss.
The basis for determining the combination of other receivables is as follows:
Other receivable portfolio 1 Interest receivable
Portfolio of other receivables 2 Dividends receivable
Other combinations of receivables 3 Deposit and margin receivable
Other receivable portfolio 4 Receivable advances
Combination of other receivables 5 Value-added tax receivable is increased and refunded
Other receivable portfolio 6 Receivables from related parties within the scope of
consolidation
Other receivables portfolio 7 Other receivables
For other receivables divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
The basis for determining the combination of receivables financing is as follows:
Receivables financing portfolio 1 bank acceptance bill
For Notes receivable divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
The basis for determining the portfolio of contract assets is as follows:
Contract assets portfolio 1 conditional collection right of sales
Contract assets portfolio 2 Completed and unsettled project not meeting collection
China Fangda Group Co., Ltd. Notes to Financial Statements
conditions
Contract assets portfolio 3 Quality guarantee deposit not meeting collection conditions
For contract assets divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
Other debt investment
For other receivables divided into portfolios, the Company refers to historical credit loss
experience, combined with current conditions and predictions of future economic conditions,
and calculates through default risk exposure and expected credit loss rate within the next 12
months or the entire duration Expected credit losses.
② Lower credit risk
If the risk of default on financial instruments is low, the borrower's ability to meet its
contractual cash flow obligations in the short term is strong, and even if the economic
situation and operating environment are adversely changed over a long period of time, it may
not necessarily reduce the receivables' performance of their contractual cash. The ability of
the flow obligation, the financial instrument is considered to have a lower credit risk.
③ Significant increase in credit risk
The Company compares the default probability of the financial instrument during the
expected lifetime determined by the balance sheet date with the default probability of the
expected lifetime during the initial confirmation to determine the relative probability of the
default probability of the financial instrument during the expected lifetime Changes to assess
whether the credit risk of financial instruments has increased significantly since initial
recognition.
In determining whether the credit risk has increased significantly since the initial
recognition, the Company considers reasonable and evidenced information, including
forward-looking information, that can be obtained without unnecessary additional costs or
effort. The information considered by the Company includes:
A. Significant changes in internal price indicators resulting from changes in credit risk;
China Fangda Group Co., Ltd. Notes to Financial Statements
B. Adverse changes in business, financial or economic conditions that are expected to
cause significant changes in the debtor's ability to perform its debt service obligations;
C. Whether the actual or expected operating results of the debtor have changed
significantly; whether the regulatory, economic or technical environment of the debtor has
undergone significant adverse changes;
D. Whether there is a significant change in the value of the collateral used as debt
collateral or the guarantee provided by a third party or the quality of credit enhancement.
These changes are expected to reduce the debtor's economic motivation for repayment within
the time limit specified in the contract or affect the probability of default;
E. Whether there is a significant change in the economic motivation that is expected to
reduce the debtor's repayment according to the contractual deadline;
F. Anticipated changes to the loan contract, including whether the expected violation of
the contract may result in the exemption or revision of contract obligations, granting
interest-free periods, rising interest rates, requiring additional collateral or guarantees, or
making other changes to the contractual framework of financial instruments change;
G. Whether the expected performance and repayment behavior of the debtor has changed
significantly;
H. Whether the contract payment is overdue for more than (including) 30 days.
Based on the nature of financial instruments, the Company assesses whether credit risk
has increased significantly on the basis of a single financial instrument or combination of
financial instruments. When conducting an assessment based on a combination of financial
instruments, the Company can classify financial instruments based on common credit risk
characteristics, such as overdue information and credit risk ratings.
If the overdue period exceeds 30 days, the Company has determined that the credit risk
of financial instruments has increased significantly. Unless the Company does not have to pay
excessive costs or efforts to obtain reasonable and warranted information, it proves that
although it has exceeded the time limit of 30 days agreed upon in the Contract, credit risks
have not increased significantly since the initial confirmation.
④ Financial assets with credit impairment
The Company assesses on the balance sheet date whether financial assets measured at
China Fangda Group Co., Ltd. Notes to Financial Statements
amortized cost and credit investments measured at fair value and whose changes are included
in other comprehensive income have undergone credit impairment. When one or more events
that adversely affect the expected future cash flows of a financial asset occur, the financial
asset becomes a financial asset that has suffered a credit impairment. Evidence that credit
impairment has occurred in financial assets includes the following observable information:
Major financial difficulties have occurred to the issuer or the debtor; Breach of contract
by the debtor, such as payment of interest or default or overdue of principal; (B) The
concession that the debtor would not make under any other circumstances for economic or
contractual considerations relating to the financial difficulties of the debtor; The debtor is
likely to be bankrupt or undertake other financial restructuring; The financial difficulties of
the issuer or debtor lead to the disappearance of the active market for the financial asset; To
purchase or generate a financial asset at a substantial discount, which reflects the fact that a
credit loss has occurred.
⑤ Presentation of expected credit loss measurement
In order to reflect the changes in the credit risk of financial instruments since the initial
recognition, the Company re-measures the expected credit losses on each balance sheet date,
and the increase or reversal of the loss provision resulting therefrom is included as an
impairment loss or gain. Current profit and loss. For financial assets measured at amortized
cost, the loss allowance offsets the book value of the financial asset listed on the balance sheet;
for debt investments measured at fair value and whose changes are included in other
comprehensive income, the Company Recognition of its loss provisions in gains does not
offset the book value of the financial asset.
⑥ Cancellation
If it is no longer reasonably expected that the contract cash flow of the financial assets
will be fully or partially recovered, the book balance of the financial assets will be directly
reduced. Such write-off constitute the derecognization of related financial assets. This usually
occurs when the Company determines that the debtor has no assets or sources of income that
generate sufficient cash flow to cover the amount that will be written down.
If the financial assets that have been written down are recovered in the future, the
reversal of the impairment loss is included in the profit or loss of the current period.
China Fangda Group Co., Ltd. Notes to Financial Statements
(6) Transfer of financial assets
The transfer of financial assets refers to the following two situations:
A. Transfer the contractual right to receive cash flow of financial assets to another party;
B. Transfers the financial assets to the other party in whole or in part, but reserves the
contractual right to collect the cash flow of the financial assets and undertakes the contractual
obligation to pay the collected cash flow to one or more recipients.
① De-identification of transferred financial assets
Those who have transferred almost all risks and rewards in the ownership of financial
assets to the transferee, or have neither transferred nor retained almost all the risks and
rewards in the ownership of financial assets, but have given up control of the financial assets,
terminate the confirmation The financial asset.
In determining whether control over the transferred financial asset has been waived, the
actual capacity of the transferor to sell the financial asset is determined. If the transferor is
able to sell the transferred financial assets wholly to a third party that does not have a
relationship with them, and has no additional conditions to limit the sale, it indicates the
Company has waived control over the financial assets.
The Company pays attention to the essence of financial asset transfer when judging
whether financial asset transfer meets the condition of financial asset termination.
If the overall transfer of financial assets meets the conditions for termination of
confirmation, the difference between the following two amounts is included in the current
profit and loss:
A. Continuing identification of transferred Book value；
B. The sum of the amount received as a result of the transfer and the amount accrued as a
result of the change in the fair value of the transfer in respect of the termination recognized
portion of the amount previously charged directly to the other consolidated proceeds (the
financial assets involved in the transfer are those classified in accordance with Article 18 of
Enterprise Accounting Standard No. 22 - Financial Instruments Recognition and
Measurement as measured by the fair value and whose change is charged to the other
consolidated proceeds).
China Fangda Group Co., Ltd. Notes to Financial Statements
If the partial transfer of financial assets meets the conditions for derecognization, the
book value of the entire transferred financial assets will be included in the derecognized part
and the unterminated part (in this case, the retained service assets are regarded as part of the
continued recognition of financial assets) Between them, they are apportioned according to
their respective relative fair values on the transfer date, and the difference between the
following two amounts is included in the current profit and loss:
A. Termination of the book value of the recognized portion on the date of
derecognization;
B. The sum of the amount received as a result of the transfer and the amount accrued as a
result of the change in the fair value of the transfer in respect of the termination recognized
portion of the amount previously charged to the other consolidated proceeds (the financial
assets involved in the transfer are those classified in accordance with Article 18 of Enterprise
Accounting Standard No. 22 - Financial Instruments Recognition and Measurement as
measured by the fair value and whose change is charged to the other consolidated proceeds).
② Continue to be involved in the transferred financial assets
If neither transfer nor retain almost all the risks and rewards of the ownership of financial
assets, and have not given up control of the financial assets, the relevant financial assets
should be confirmed according to the extent of their continued involvement in the transferred
financial assets, and the relevant liabilities should be recognized accordingly.
The extent to which the transferred financial assets continue to be involved refers to the
extent to which the enterprise undertakes the risk or compensation of the value change of the
transferred financial assets.
③ Continuing identification of transferred financial assets
Where almost all risks and remuneration in relation to ownership of the transferred
financial assets are retained, the whole of the transferred financial assets shall continue to be
recognized and the consideration received shall be recognized as a financial liability.
The financial asset and the recognized related financial liabilities shall not offset each
other. In the subsequent accounting period, the enterprise shall continue to recognize the
income (or gain) generated by the financial asset and the costs (or losses) incurred by the
financial liability.
China Fangda Group Co., Ltd. Notes to Financial Statements
(7) Deduction of financial assets and liabilities
Financial assets and financial liabilities should be listed separately in the balance sheet,
and cannot be offset against each other. However, if the following conditions are met, the net
amount offset by each other is listed in the balance sheet:
The Company has a statutory right to offset the confirmed amount, and such legal right is
currently enforceable;
The Company plans to settle the net assets or realize the financial assets and liquidate the
financial liabilities at the same time.
The transferring party shall not offset the transferred financial assets and related
liabilities if it does not meet the conditions for terminating the recognition.
(8) Recognition of fair value of Finance instruments
See Note III. 12 for the recognition of fair value of financial assets and liabilities.
Fair value refers to the amount of asset exchange or liabilities settlement by both
transaction parties familiar with the situation in a fair deal on a voluntary basis.
The Company measures the fair value of related assets or liabilities at the prices in the
main market. If there is no major market, the Company measures the fair value of the relevant
assets or liabilities at the most favorable market prices. The Group uses assumptions that
market participants use to maximize their economic benefits when pricing the asset or
liability.
The main market refers to the market with the highest transaction volume and activity of
the related assets or liabilities. The most favorable market means the market that can sell the
related assets at the highest amount or transfer the related liabilities at the lowest amount after
considering the transaction cost and transportation cost.
For financial assets or liabilities in an active market, The Company determines their fair
value based on quotations in the active market. If there is no active market, the Company uses
evaluation techniques to determine the fair value.
For the measurement of non-financial assets at fair value, the ability of market
participants to use the assets for optimal purposes to generate economic benefits, or the ability
China Fangda Group Co., Ltd. Notes to Financial Statements
to sell the assets to other market participants that can be used for optimal purposes to generate
economic benefits.
① Evaluation techniques
The Company adopts valuation techniques that are applicable in the current period and
are supported by sufficient data and other information. The valuation techniques used mainly
include market method, income method and cost method. The Company uses a method
consistent with one or more of the valuation techniques to measure fair value. If multiple
valuation techniques are used to measure fair value, the reasonableness of each valuation
result shall be considered, and the fair value shall be selected as the most representative of fair
value under the current circumstances. The amount of value is regarded as fair value.
The The Company equipment are applicable in the current circumstances and have
sufficient available data and other information to support the use of the relevant observable
input values prioritized. Unobservable input values are used only when the observable input
value cannot be obtained or is not feasible. Observable input values are input values that can
be obtained from market data. The Group uses assumptions that market participants use to
maximize their economic benefits when pricing the asset or liability. Non-observable input
values are input values that cannot be obtained from market data. The input value is obtained
based on the best information available on assumptions used by market participants in pricing
the relevant asset or liability.
②Fair value hierarchy
This company divides the input value used in fair value measurement into three levels,
and first uses the first level input value, then uses the second level input value, and finally
uses the third level input value. First level: quotation of same assets or liabilities in an active
market (unadjusted) The second level input value is a directly or indirectly observable input
value of the asset or liability in addition to the first level input value. The input value of the
third level is the unobservable input value of the related asset or liability.
(1) Classification of inventories
Inventories refer to finished goods or merchandise held for sale in the ordinary course of
business, work-in-process, and materials and supplies consumed in the production process or
China Fangda Group Co., Ltd. Notes to Financial Statements
during the rendering of services, including raw materials, work-in-process, semi-finished
goods, finished goods, merchandise inventories, and reusable materials.
(2) Pricing of delivering inventory
The Company measures inventories issued using the weighted average cost method.
The inventory of real estate business mainly includes inventory materials, development
costs, development products, etc. The actual costs of development products include land
transfer payment, infrastructure and facility costs, installation engineering costs, borrows
before completion of the development and other costs during the development process. The
special maintenance funds collected in the first period are included in the development
overheads. When the control right of development products is transferred, the individual
valuation method is used to determine its actual cost.
(3) Inventory system
The Company inventory adopts the perpetual inventory system, counting at least once a
year, the inventory profit and loss amount is included in the current year's profit and loss.
(4) Criteria for recognizing and providing for provision for decline in value of
inventories
On the balance sheet date, inventories are accounted depending on which is lower
between the cost and the net realizable value. If the cost is higher than the net realizable value,
the impairment provision will be made.
The realizable net value of inventory should be recognized based on solid evidence with
the purpose of the inventory and after-balance-sheet-date events taken into consideration.
(1) In the course of normal production and operation, the net realizable value of finished
goods, commodities and materials directly used for sale shall be determined by the estimated
price of the inventory minus the estimated cost of sale and related taxes. The inventory held
for the execution of a sales contract or a labor contract shall be measured on the basis of the
contract price as its net realizable value; If the quantity held is greater than the quantity
ordered under the sales contract, the net realizable value of the excess inventory is measured
on the basis of the general sales price. For materials used for sale, the market price shall be
used as the measurement basis for the net realizable value.
②In the normal production and operation process, the inventory of materials that need to
China Fangda Group Co., Ltd. Notes to Financial Statements
be processed is determined by the amount of the estimated selling price of the finished
product minus the estimated cost to be incurred at the time of completion, estimated sales
expenses and related taxes Realize the net value. If the net realizable value of the finished
product produced by it is higher than the cost, the material is measured at cost; If the decrease
in the price of the material indicates that the net realizable value of the finished product is
lower than the cost, the material is measured as the net realizable value and the inventory is
prepared for a decrease based on its difference.
③ If the factors affecting the previous write-down of inventory value have disappeared
on the balance sheet date, the amount of the write-down will be restored and transferred back
within the amount of inventory depreciation reserve that has been accrued, and the amount
returned will be included in the current profit and loss.
(5) Methods of amortization of swing materials
① Low-value consumables are amortized on on-off amortization basis at using.
② Packages are amortized on on-off amortization basis at using.
The Company presents contract assets or liabilities in the balance sheet according to the
relationship between performance obligation and customer payment. The consideration for
which the Company is entitled to receive (subject to factors other than the passage of time) for
the transfer of goods or the provision of services to customers is listed as contract assets. The
Company's obligation to transfer goods or provide services to customers for consideration
received or receivable from customers is listed as contractual liabilities.
The Company's determination method and accounting treatment method for the expected
credit loss of contract assets are detailed in Note III 11.
Contract assets and contract liabilities are listed separately in the balance sheet. Contract
assets and contract liabilities under the same contract are listed in net amount. If the net
amount is the debit balance, it shall be listed in "contract assets" or "other non current assets"
according to its liquidity; if the net amount is the credit balance, it shall be listed in "contract
liabilities" or "other non current liabilities" according to its liquidity. Contract assets and
contract liabilities under different contracts cannot offset each other.
China Fangda Group Co., Ltd. Notes to Financial Statements
Contract cost is divided into contract performance cost and contract acquisition cost.
The cost incurred by the Company in performing the contract shall be recognized as an
asset when the following conditions are met simultaneously:
① The cost is directly related to a current or expected contract, including direct labor,
direct materials, manufacturing expenses (or similar expenses), clearly borne by the customer,
and other costs incurred only due to the contract;
② This cost increases the Company's future resources for fulfilling its performance
obligations.
③ The cost is expected to be recovered.
If the incremental cost incurred by the Company to obtain the contract is expected to be
recovered, it shall be recognized as an asset as the contract acquisition cost.
The assets related to the contract cost shall be amortized on the same basis as the income
from goods or services related to the assets; however, if the amortization period of the
contract acquisition cost is less than one year, the Company shall include it in the current
profit and loss when it occurs.
If the book value of the assets related to the contract cost is higher than the difference
between the following two items, the Company will make provision for impairment for the
excess part and recognize it as the loss of asset impairment, and further consider whether the
estimated liabilities related to the loss contract should be made:
① The residual consideration expected to be obtained due to the transfer of goods or
services related to the asset;
② The estimated cost to be incurred for the transfer of the relevant goods or services.
If the above provision for impairment of assets is subsequently reversed, the book value
of the asset after reversal shall not exceed the book value of the asset on the reversal date
without provision for impairment.
The contract performance cost recognized as an asset with an amortization period of no
more than one year or one normal business cycle at the time of initial recognition shall be
listed in the "inventory" item, and the amortization period of no more than one year or one
normal business cycle at the time of initial recognition shall be listed in the "other non current
China Fangda Group Co., Ltd. Notes to Financial Statements
assets" item.
The contract acquisition cost recognized as an asset shall be listed in the item of "other
current assets" when the amortization period does not exceed one year or one normal business
cycle at the time of initial recognition, and listed in the item of "other non current assets"
when the amortization period exceeds one year or one normal business cycle at the time of
initial recognition.
The Group's long-term equity investment includes control on invested entities and
significant impacts on equity investment. Invested entities on which the Group has significant
impacts are associates of the Group.
(1) Basis for recognition of common control and major influence on invested entities
Common control refers to the common control of an arrangement in accordance with the
relevant agreement, and the relevant activities of the arrangement must be agreed upon by the
participants who share control. In determining whether there is common control, the first step
is to determine whether all or a group of participants collectively control the arrangement,
which is considered collective control by all or a group of participants if all or a group of
participants must act together to determine the activities associated with the arrangement.
Secondly, it is judged whether the decision on related activities of the arrangement must be
agreed by the participants who collectively control the arrangement. If there is a combination
of two or more parties that can collectively control an arrangement, it does not constitute joint
control. When judging whether there is joint control, the protective rights enjoyed are not
considered.
Major influence refers to the power to participate in decision-making of financial and
operation policies of a company, but cannot control or jointly control the making of the
policies. When considering whether the Company can impose significant impacts on the
invested entity, impacts of conversion of shares with voting rights held directly or indirectly
by the investor and voting rights that can be executed in this period held by the investor and
other party into shares of the invested entity should be considered.
If the Company directly or through subsidiaries holds more than 20% (inclusive) but less
than 50% of the shares with voting rights of the invested entity, unless there is clear evidence
China Fangda Group Co., Ltd. Notes to Financial Statements
proving that the Company cannot participate the decision-making of production and operation
of the invested entity, the Company has major influence on the invested entity.
(2) Recognition of initial investment costs
① For long-term equity investments formed through business combinations, the
investment cost is determined in accordance with the following provisions:
A. In the case of an enterprise merger under the same control, where the merging party
makes a valuation of the merger by payment of cash, transfer of non-cash assets or
undertaking liabilities, the share of the book value of the owner's interest in the final
controlling party's consolidated financial statements as the initial investment cost of the
long-term equity investment at the date of the merger. The difference between the initial
investment cost of long-term equity investment and the cash paid, the transferred non-cash
assets and the book value of the debt assumed shall be adjusted to the capital reserve; if the
capital reserve is insufficient to offset, the retained earnings shall be adjusted;
Long-term equity investment generated by enterprise merger: for long-term equity
investment obtained by merger of enterprises under common control, the obtained share of
book value of the interests of the merged party's owner in the consolidate financial statements
on the merger date is costs; for long-term equity investment obtained by merger of enterprises
not under common control, the merger cost is the investment cost. Adjust the capital reserve
according to the difference between the initial investment cost of long-term equity investment
and the total face value of the issued shares. If the capital reserve is insufficient to offset or
reduce, the retained income shall be adjusted;
For merger of entities under different control, the merger cost is the fair value of the asset
paid, liability undertaken, and equity securities issued for exchanging of control power over
the entities at the day of acquisition. Agency expenses and other administrative expenses such
as auditing, legal consulting, or appraisal services occurred relating to the merger of entities
are accounted into current income account when occurred.
② For long-term equity investments acquired through means other than business
combinations, the investment cost is determined in accordance with the following provisions:
For long-term equity investment obtained by cash, the actually paid consideration is the
initial investment cost. Initial investment costs include expenses, taxes and other necessary
China Fangda Group Co., Ltd. Notes to Financial Statements
expenditures directly related to the acquisition of long-term equity investments;
B. Long-term equity investments acquired from the issuance of interest securities are the
initial investment costs based on the fair value of the issue interest securities;
C. For long-term equity investments obtained through non-monetary asset exchanges, if
the exchange has commercial substance and the fair value of the exchanged assets or
exchanged assets can be reliably measured, the fair value of the exchanged assets and relevant
taxes shall be used as the initial Investment cost, the difference between the fair value and
book value of the swapped-out asset is included in the current profit and loss; if the
non-monetary asset exchange does not meet the above two conditions at the same time, the
book value of the swapped-out asset and relevant taxes will be used as the initial investment
cost.
D. Long-term equity investments acquired through debt restructuring determine their
recorded value at the fair value of the waived claims and other costs such as taxes directly
attributable to the assets and account for the difference between the fair value and the book
value of the waived claims.
(3) Subsequent measurement and recognition of gain/loss
The Company uses the cost method to measure long-term share equity investment in
which the Company can control the invested entity; and uses the equity method to measure
long-term share equity investment in which the Company has substantial influence on the
invested entity.
① Cost method
For the long-term equity investment measured on the cost basis, except for the
announced cash dividend or profit included in the practical cost or price when the investment
was made, the cash dividends or profit distributed by the invested entity are recognized as
investment gains in the current gain/loss account.
② Equitymethod
Gains from long-term equity investment measured by equity
When the equity method is used to measure long-term equity investment, the investment
cost will not be adjusted if the investment cost of the long-term equity investment is larger
than the share of fair value of the recognizable assets of the invested entity. When it is smaller
China Fangda Group Co., Ltd. Notes to Financial Statements
than the share of fair value of the recognizable assets of the invested entity, the book value
will be adjusted and the difference is included in the current gains of the investment.
When the equity method is used, the current investment gain is the share of the net gain
realized in the current year that can be shared or borne, recognized as investment gain and
other misc. income. The book value of the long-term equity investment is adjusted
accordingly. The book value of the long-term equity investment should be accordingly
decreased based on the share of profit or cash dividend announced by the invested entity;
according to other changes in the owner's equity except for net profit and loss, other misc
income and profit distribution of the invested entity, adjust the book value of the long-term
equity investment and record it in the capital surplus (other capital surplus). When the share
of the net gains that can be enjoyed is recognized, it is recognized after the net profit of the
invested entity is adjusted based on the fair value of the recognizable assets of the invested
entity according to the Company's accounting policies and accounting period. Where the
accounting policy and accounting period adopted by the Invested unit are inconsistent with
the Company, the financial statements of the Invested unit shall be adjusted in accordance
with the accounting policy and accounting period of the Company, and the investment income
and other consolidated income shall be recognized. Internal transaction gain not realized
between the Company and affiliates is measured according to the shareholding proportion and
the investment gains is recognized after deduction. The unrealized internal transaction loss
between the Company and the invested entity is the impairment loss of transferred assets and
should not be written off.
Where substantial influence on invested entities is imposed or joint control is
implemented due to increase in investment, the sum of the fair value of the original equity and
increased investment on the conversion date is the initial investment cost under the equity
method. If the equity investment originally held is classified as other equity instrument
investment, the difference between the fair value and the book value, as well as the
accumulated gains or losses originally included in other comprehensive income, shall be
transferred out of other comprehensive income and included in retained income in the current
period when the equity method is adopted.
Where joint control or substantial influence on invested entities is lost due to disposal of
part of investment, the remaining equity after the disposal should be treated according to the
Enterprise Accounting Standard No.22 – Recognition and Measurement of Financial
China Fangda Group Co., Ltd. Notes to Financial Statements
Instruments from the date of losing the joint control or substantial influence. The difference
between the fair value and book value should be accounted the profit and loss of the current
period. For other misc. incomes of original share equity investment determined using the
equity method, when the equity method is no longer used, it should be treated based on the
same basis of the treatment of related assets or liability of the invested entities; the other
owners' interests related to the original share equity investment should be transferred to
gain/loss of the current period.
(4) Equity investment held for sale
For the remaining equity investments not classified as assets held for sale, the equity
method is adopted for accounting treatment.
Equity investments classified as held for sale to associates that are no longer eligible to
hold classified assets for sale are retrospectively adjusted using the equity method starting
from the date that they are classified as held for sale. The classification is adjusted to hold the
financial statements for the period to be sold.
(5) Impairment examination and providing of impairment provision
See Note III. 22 for the assets impairment provision method for investment in
subsidiaries and joint ventures.
(1) Classification of investment real estate
Investment real estates are held for rent or capital appreciation, or both. These include,
inter alia:
① Leased land using right
② the right to use the land that is transferred after holding and preparing for the
increment.
③ Leased building
(2) Measurement of investment real estate
For investment real estates with an active real estate transaction market and the Company
can obtain market price and other information of same or similar real estates to reasonably
estimate the investment real estates' fair value, the Company will use the fair value mode to
China Fangda Group Co., Ltd. Notes to Financial Statements
measure the investment real estates subsequently. Variations in fair value are accounted into
the current gain/loss account.
The fair value of investment real estate is determined with reference to the current
market prices of same or similar real estates in active markets; when no such price is available,
with reference to the recent transaction prices and consideration of factors including
transaction background, date and district to reasonably estimate the fair value; or based on the
estimated lease gains and present value of related cash flows.
For investment real estate under construction (including investment real estate under
construction for the first time), if the fair value cannot be reliably determined but the expected
fair value of the real estate after completion is continuously and reliably obtained, the
investment real estate under construction is measured by cost. When the fair value can be
measured reliably or after completion (the earlier one), it is measured at fair value. For an
investment real estate whose fair value is proven unable to be obtained continuously and
reliably by objective evidence, the real estate will be measured at cost basis until it is disposed
and no residual value remains as assumed.
Fixed assets is defined as the tangible assets which are held for the purpose of producing
goods, providing services, lease or for operation & management, and have more than one
accounting year of service life.
(1) Recognition conditions
Fixed assets are recognized at the actual cost of acquisition when the following
conditions are met: (1) The economic benefits associated with the fixed assets are likely to
flow into the enterprise.
Fixed assets are recognized at the actual cost of acquisition when the following
conditions are met: (1) The economic benefits associated with the fixed assets are likely to
flow into the enterprise.
② The cost of the fixed assets can be measured reliably.
Overhaul cost generated by regular examination on fixed assets is recognized as fixed
assets costs when there is evidence proving that it meets fix assets recognition conditions. If
not, it will be accounted into the current gain/loss account.
China Fangda Group Co., Ltd. Notes to Financial Statements
(2) Depreciation of fixed assets
The types of investment real estate, estimated economic useful life and estimated net
residual value rate are determined as follows:
Depreciation Service year Annual depreciation
Type Residual rate %
method (year) rate %
Houses & buildings Average age 20-50 10.00 1.80-4.50
Mechanical equipment Average age 10.00 10.00 9.00
Transportation facilities Average age 5.00 10.00 18.00
Electronics and other
Average age 5.00 10.00 18.00
devices
PV power plants Average age 20.00 5.00 4.75
For fixed assets for which depreciation provision is made, the depreciation rate will be
determined after the accumulative depreciation provision amount is deducted.
At end of each fiscal year, verification will be made on the useful life, predicted retained
value, and depreciation basis. The useful life will be adjusted if the useful life is different
from the predicted one; the net residual value will be adjusted if the net residual value is
different from the predicted one.
(1) Construction in progress is accounted for by project classification.
(2) Standard and timing for transferring construction in process into fixed assets
The full expenditure incurred on the construction-in-progress project as a fixed asset is
recorded as the value of the asset before the asset is constructed to the intended usable state.
This includes construction costs, the original cost of equipment, other necessary expenditures
incurred in order to enable the construction works to reach the intended usable status and the
borrowing costs incurred for the specific borrowing of the project and the general borrowing
expenses incurred before the assets reach the intended usable status. Construction in process
will be transferred to fixed assets when it reaches the preset service condition. The fixed
assets that have reached the intended usable state but have not been completed shall be
transferred to the fixed assets according to the estimated value according to the estimated
value according to the estimated value according to the project budget, cost or actual project
cost, etc. The depreciation of the fixed assets shall be accrued according to the Company's
fixed assets depreciation policy. The original estimated value shall be adjusted according to
China Fangda Group Co., Ltd. Notes to Financial Statements
the actual cost after the completion.
(1) Recognition principles for capitalization of borrowing expenses
Borrowing expenses occurred to the Company that can be accounted as purchasing or
production of asset satisfying the conditions of capitalizing, are capitalized and accounted as
cost of related asset.
① Asset expenditure has occurred;
② Borrowing costs have occurred;
③ Purchasing or production activity, which is necessary for the asset to reach the useful
status, has already started.
Other interest on loans, discounts or premiums and exchange differences are included in
the income and loss incurred in the current period.
If the construction or production of assets satisfying the capitalizing conditions is
suspended abnormally for over 3 months, capitalizing of borrowing expenses shall be
suspended. During the normal suspension period, borrowing expenses will be capitalized
continuously.
When the asset satisfying the capitalizing conditions has reached its usable or sellable
status, capitalizing of borrowing expenses shall be terminated.
(2) Calculation of the capitalization amount of borrowing expense
Interest expenses generated by special borrowings less the interests income obtained
from the deposit of unused borrowings or investment gains from temporary investment is
capitalized; the capitalization amount for general borrowing is determined based on the
capitalization rate which is the exceeding part of the accumulative assets expense over
weighted average of the assets expense of the special borrowing/used general borrowing.
If the assets that are constructed or produced under the condition of capitalization occupy
the general borrowing, the interest amount to be capitalized in the general borrowing shall be
calculated and determined by multiplying the capital rate of the general borrowing by the
weighted average of the asset expenditure of the accumulated assets whose expenditure
exceeds that of the specialized borrowing. The capitalization ratio is the weighted average
China Fangda Group Co., Ltd. Notes to Financial Statements
interest rate of general borrowings.
(1) Pricing of intangible assets
Recorded at the actual cost of acquisition.
(2) Amortization of intangible assets
① Useful life of intangible assets with limited useful life
Estimated useful
Item Basis
life
Land using right Term Use right assets
Reference to determine the lifetime of a company for
Trademarks and patents 10 years
which it can bring economic benefits
Reference to determine the lifetime of a company for
Proprietary technology 10 years
which it can bring economic benefits
Reference to determine the lifetime of a company for
Software 5. 10 years
which it can bring economic benefits
At the end of each year, the Company will reexamine the useful life and amortization
basis of intangible assets with limited useful life. Upon review, the service life and
amortization methods of intangible assets at the end of the period are not different from those
previously estimated.
(2) Intangible assets which cannot be foreseeable to bring economic benefits to
enterprises shall be regarded as intangible assets whose useful life is uncertain. For intangible
assets with uncertain service life, the Company reviews the service life of intangible assets
with uncertain service life at the end of each year. If it is still uncertain after rechecking, it
shall conduct an impairment test on the balance sheet date.
③ Amortization of intangible assets
For intangible assets with finite useful lives, the Company determines their useful life
upon acquisition and systematically amortizes them using the straight-line method over their
useful life. The amortization amount is included in the current profit or loss of the benefiting
project or added to the cost of the related asset. The specific amortization amount is the
amount after the cost is deducted from the estimated residual value. For fixed assets for which
depreciation provision is made, the depreciation rate will be determined after the
accumulative depreciation provision amount is deducted. The residual value of an intangible
asset with limited useful life is treated as zero, except where a third party undertakes to
China Fangda Group Co., Ltd. Notes to Financial Statements
purchase the intangible asset at the end of its useful life or to obtain expected residual value
information based on the active market, which is likely to exist at the end of its useful life.
Intangible assets with uncertain service life will not be amortized. At the end of each year,
the useful life of intangible assets with uncertain useful life is reviewed, and if there is
evidence that the useful life of intangible assets is limited, the useful life is estimated and the
system is reasonably amortized within the expected useful life.
Specific standard for distinguish between research and development stage
The company takes the information and related preparatory activities for further
development activities as the research stage, and the intangible assets expenditure in the
research stage is included in the current profit and loss period.
(2) The development activities carried out after the company has completed the research
stage as the development stage.
(4) Specific conditions for capitalization of expenditures in the development phase
Expenditures in the development phase can be recognized as intangible assets only when
the following conditions are met:
A. It is technically feasible to complete the intangible asset so that it can be used or sold;
B. Have the intention to complete the intangible asset and use or sell it;
C. The way intangible assets generate economic benefits, including the ability to prove
that the products produced by the intangible assets exist in the market or the intangible assets
themselves exist in the market, and the intangible assets will be used internally, which can
prove their usefulness;
D. Have sufficient technical, financial and other resource support to complete the
development of the intangible asset, and have the ability to use or sell the intangible asset;
E. The expenditure attributable to the development stage of the intangible asset can be
reliably measured.
The Group uses the cost mode to continue measuring the assets impairment to
investment real estate, fixed assets construction in progress, intangible assets and goodwill
(except for the inventories, investment real estate measured by the fair value mode, deferred
China Fangda Group Co., Ltd. Notes to Financial Statements
income tax assets and financial assets). The method is determined as follows:
The Company judges whether there is a sign of impairment to assets on the balance sheet
day. If such sign exists, the Company estimates the recoverable amount and conducts the
impairment test. Impairment test is conducted annually for goodwill generated by mergers and
intangible assets that have not reached the useful condition no matter whether the impairment
sign exists.
The recoverable amount is determined by the higher of the net of fair value minus
disposal expense and the present value of the predicted future cash flow. The Company
estimates the recoverable amount on the individual asset item basis; whether it is hard to
estimate the recoverable amount on the individual asset item basis, determine the recoverable
amount based on the asset group that the assets belong to. The assets group is determined by
whether the main cash flow generated by the Group is independent from those generated by
other assets or assets groups.
When the recoverable amount of the assets or assets group is lower than its book value,
the Company writes down the book value to the recoverable amount, the write-down amount
is accounted into the current income account and the assets impairment provision is made.
For goodwill impairment test, the book value of goodwill generated by mergers is
amortized through reasonable measures since the purchase day to related asset groups; those
cannot be amortized to related assets groups are amortized to related combination of asset
groups. The related asset groups or combination of asset groups refer to those that can benefit
from the synergistic effect of mergers and must not exceed to the reporting range determined
by the Company.
When the impairment test is conducted, if there is sign of impairment to the asset group
or combination of asset groups related to goodwill, first perform impair test for asset group or
combination of asset groups without goodwill and calculate the recoverable amount and
recognize the related impairment loss. Then conduct impairment test on those with goodwill,
compare the book value with recoverable amount. If the recoverable amount is lower than the
book value, recognize the impairment loss of the goodwill.
Once recognized, the asset impairment loss cannot be written back in subsequent
accounting period.
China Fangda Group Co., Ltd. Notes to Financial Statements
The long-term deferred expenses shall be used to calculate the expenses that have
occurred but should be borne by the Company in the current and subsequent periods with a
amortization period of more than one year. The Company's long-term deferred expenses are
amortized averagely during the benefit period.
Staff remuneration is the compensation paid by the employer to the staff for the services
they provide or for termination of the working relationship. Staff remuneration includes
short-term remuneration and post-employment welfare. The benefits provided by the
Company to the spouses, children, dependants, survivors and other beneficiaries of the staff
are also the remuneration of the staff.
According to liquidity, employee compensation is listed in the "employee compensation
payable" and "long-term employee compensation payable" items of the balance sheet
respectively.
(1) Accounting of operational leasing
① Basic salary of employees (salary, bonus, allowance, subsidy)
In the accounting period for which the staff and workers provide services, the Company
shall confirm the actual short-term remuneration as liabilities and shall account for the current
income and loss, except as required or permitted by other accounting standards.
② Employee welfare
The employee benefits incurred by the Company shall be included in the current profit
and loss or related asset costs according to the actual amount incurred. Where the employee's
benefit is non-monetary, it shall be measured on the basis of fair value.
③ Social insurance premiums and housing accumulation funds such as health insurance
premiums, work injury premiums, birth insurance premiums, trade union funds and staff and
education funds
The Company pays the medical insurance premiums, work injury insurance premiums,
birth insurance premiums, etc. social insurance premiums and housing accumulation funds for
the staff and workers, as well as the union funds and the staff and workers education funds
according to the regulations, in the accounting period for which the staff and workers provide
China Fangda Group Co., Ltd. Notes to Financial Statements
services, the corresponding salary amount of the staff and workers, and confirms the
corresponding liabilities, which are included in the current profit and loss or related asset
costs.
④ Short-term paid leave
The Company accumulates the salary of the employees who are absent from work with
pay when the employees provide service, thus increasing their future right of absence with pay.
The Company confirms the salary of the employee related to the absence of non-cumulative
salary during the actual absence accounting period.
⑤ Short-term profit share program
If the profit-sharing plan meets the following conditions at the same time, the Company
shall confirm the salary payable to the staff and workers:
A. The legal or presumptive obligation of the enterprise to pay the remuneration of its
employees as a result of past matters;
B. The amount of employee compensation obligations due to the profit sharing plan can
be reliably estimated.
(2) Accounting of post-employment welfare
The Company's post-employment benefit plan is defined contribution plan. Defined
contribution plans include basic endowment insurance, unemployment insurance, etc. During
the accounting period when employees provide services for them, the Company shall
recognize the deposit amount calculated according to the defined deposit plan as liabilities
and include it in the current profits and losses or related asset costs.
(3) Accounting of dismiss welfare
If the Company provides termination benefits to employees, the employee compensation
liabilities arising from the termination benefits shall be recognized at the earliest of the
following two and shall be included in the current profit and loss:
(1) An enterprise may not unilaterally withdraw the resignation benefits provided for by
the dismissal plan or reduction proposal;
(2) When the enterprise recognizes the costs or expenses related to the reorganization
involving the payment of resignation benefits.
China Fangda Group Co., Ltd. Notes to Financial Statements
(1) Recognition standards of anticipated liabilities
When responsibilities occurred in connection to contingent issues, and all of the
following conditions are satisfied, they are recognized as expectable liability in the balance
sheet:
① This responsibility is a current responsibility undertaken by the Company;
② Execution of this responsibility may cause financial benefit outflow from the
Company;
③ Amount of the liability can be reliably measured.
(2) Measurement of anticipated liabilities
Expected liabilities are initially measured at the best estimation on the expenses to
exercise the current responsibility, and with considerations to the relative risks, uncertainty,
and periodic value of currency. On each balance sheet date, review the book value of the
estimated liabilities. Where there is conclusive evidence that the book value does not reflect
the current best estimate, the book value is adjusted to the current best estimate.
(1) General principles
Income is the total inflow of economic benefits formed in the daily activities of the
Company, which will lead to the increase of shareholders' equity and has nothing to do with
the capital invested by shareholders.
The Company has fulfilled the performance obligation in the contract, that is, the
revenue is recognized when the customer obtains the control right of relevant goods. To
obtain the control right of the relevant commodity means to be able to dominate the use of the
commodity and obtain almost all the economic benefits from it.
If there are two or more performance obligations in the contract, the Company will
allocate the transaction price to each single performance obligation according to the relative
proportion of the separate selling price of the goods or services promised by each single
performance obligation on the start date of the contract, and measure the income according to
the transaction price allocated to each single performance obligation.
China Fangda Group Co., Ltd. Notes to Financial Statements
The transaction price refers to the amount of consideration that the Company is expected
to be entitled to receive due to the transfer of goods or services to customers, excluding the
amount collected on behalf of a third party. When determining the contract transaction price,
if there is a variable consideration, the Company shall determine the best estimate of the
variable consideration according to the expected value or the most likely amount, and include
it in the transaction price with the amount not exceeding the accumulated recognized income
when the relevant uncertainty is eliminated, which is most likely not to have a significant
reversal. If there is a significant financing component in the contract, the Company will
determine the transaction price according to the amount payable in cash when the customer
obtains the control right of the commodity. The difference between the transaction price and
the contract consideration will be amortized by the effective interest method during the
contract period. If the interval between the control right transfer and the customer's payment
is less than one year, the Company will not consider the financing component Points.
If one of the following conditions is met, the performance obligation shall be performed
within a certain period of time; otherwise, the performance obligation shall be performed at a
certain point of time:
① When the customer performs the contract in the Company, he obtains and consumes
the economic benefits brought by the Company's performance;
② Customers can control the goods under construction during the performance of the
contract;
③ The goods produced by the Company in the process of performance have
irreplaceable uses, and the Company has the right to collect money for the performance part
that has been completed so far during the whole contract period.
For the performance obligations performed within a certain period of time, the Company
shall recognize the revenue according to the performance progress within that period, except
that the performance progress cannot be reasonably determined. The Company determines the
progress of performance for the provision of services on the basis of the input (or output)
method. When the progress of performance cannot be reasonably determined, if the cost
incurred by the Company is expected to be compensated, the revenue shall be recognized
according to the amount of cost incurred until the progress of performance can be reasonably
determined.
China Fangda Group Co., Ltd. Notes to Financial Statements
For the performance obligation performed at a certain time point, the Company
recognizes the revenue at the time point when the customer obtains the control right of
relevant goods. In determining whether a customer has acquired control of goods or services,
the Company will consider the following signs:
① The Company has the right to receive payment for the goods or services, that is, the
customer has the obligation to pay for the goods;
② The Company has transferred the legal ownership of the goods to the customer, that
is, the customer has the legal ownership of the goods;
③ The Company has transferred the goods in kind to the customer, that is, the customer
has possessed the goods in kind;
④ The Company has transferred the main risks and rewards of the ownership of the
goods to the customer, that is, the customer has obtained the main risks and rewards of the
ownership of the goods;
⑤ The product has been accepted by the customer.
Sales return clause
For the sales with sales return clauses, when the customer obtains the control right of the
relevant goods, the Company shall recognize the revenue according to the amount of
consideration it is entitled to obtain due to the transfer of the goods to the customer, and
recognize the amount expected to be returned due to the sales return as the estimated liability;
at the same time, the Company shall deduct the estimated cost of recovering the goods
according to the book value of the expected returned goods at the time of transfer( The
balance after deducting the value of the returned goods is recognized as an asset, that is, the
cost of return receivable, which is carried forward by deducting the net cost of the above
assets according to the book value of the transferred goods at the time of transfer. On each
balance sheet date, the Company re estimates the return of future sales and re measures the
above assets and liabilities.
Warranty obligations
According to the contract and legal provisions, the Company provides quality assurance
for the goods sold and the projects constructed. For the guarantee quality assurance to ensure
China Fangda Group Co., Ltd. Notes to Financial Statements
that the goods sold meet the established standards, the Company conducts accounting
treatment in accordance with the accounting standards for Business Enterprises No. 13 -
contingencies. For the service quality assurance which provides a separate service in addition
to guaranteeing that the goods sold meet the established standards, the Company takes it as a
single performance obligation, allocates part of the transaction price to the service quality
assurance according to the relative proportion of the separate selling price of the goods and
service quality assurance, and recognizes the revenue when the customer obtains the service
control right. When evaluating whether the quality assurance provides a separate service in
addition to assuring customers that the goods sold meet the established standards, the
Company considers whether the quality assurance is a statutory requirement, the quality
assurance period, and the nature of the Company's commitment to perform the task.
Customer consideration payable
If there is consideration payable to the customer in the contract, unless the consideration
is to obtain other clearly distinguishable goods or services from the customer, the Company
will offset the transaction price with the consideration payable, and offset the current income
at the later time of confirming the relevant income or paying (or promising to pay) the
customer's consideration.
Contractual rights not exercised by customers
If the Company advances sales of goods or services to customers, the amount shall be
recognized as liabilities first, and then converted into income when relevant performance
obligations are fulfilled. When the Company does not need to return the advance payment and
the customer may give up all or part of the contract rights, if the Company expects to have the
right to obtain the amount related to the contract rights given up by the customer, the above
amount shall be recognized as income in proportion according to the mode of the customer
exercising the contract rights; otherwise, the Company only has the very low possibility of the
customer requiring to perform the remaining performance obligations The relevant balance of
the above liabilities is converted into income.
Contract change
When the construction contract between the Company and the customer is changed:
① If the contract change increases the clearly distinguishable construction service and
contract price, and the new contract price reflects the separate price of the new construction
China Fangda Group Co., Ltd. Notes to Financial Statements
service, the Company will treat the contract change as a separate contract for accounting;
② If the contract change does not belong to the above-mentioned situation (1), and there
is a clear distinction between the transferred construction service and the non transferred
construction service on the date of contract change, the Company will regard it as the
termination of the original contract, and at the same time, combine the non performance part
of the original contract and the contract change part into a new contract for accounting
treatment;
③ If the contract change does not belong to the above situation (1), and there is no clear distinction
between the transferred construction services and the non transferred construction services on the date of
contract change, the Company will take the contract change part as an integral part of the original contract
for accounting treatment, and the resulting impact on the recognized income will be adjusted to the current
income on the date of contract change.
(2) Specific methods
The specific methods of revenue recognition of the Company are as follows:
① Commodity sales contract
The commodity sales contract between the company and the customer includes the
performance obligation of transferring curtain wall materials, screen door materials, electric
energy, etc., which belongs to the performance obligation at a certain time point.
Revenue from domestic sales of products is recognized at the time when the customer
obtains the right of control of the goods on the basis of comprehensive consideration of the
following factors: the Company has delivered the products to the customer according to the
contract, the customer has accepted the goods, the payment for goods has been recovered or
the receipt has been obtained, and the relevant economic benefits are likely to flow in, the
main risks and rewards of the ownership of the goods have been transferred, the legal
ownership has been transferred;
The following conditions should be met for the recognition of export product revenue:
the Company has declared the product according to the contract, obtained the bill of lading,
collected the payment for goods or obtained the receipt certificate, and the relevant economic
benefits are likely to flow in, the main risks and rewards of the ownership of goods have been
transferred, and the legal ownership of goods has been transferred.
China Fangda Group Co., Ltd. Notes to Financial Statements
② Service contract
The service contract between the Company and its customers includes the performance
obligations of metro platform screen door operation maintenance, curtain wall maintenance
and property services. As the Company's performance at the same time, the customers obtain
and consume the economic benefits brought by the Company's performance, the Company
takes it as the performance obligation within a certain period of time and allocates it equally
during the service provision period.
③ Engineering contract
The project contract between the Company and the customer includes the performance
obligations of curtain wall project and metro platform screen door project construction. As the
customer can control the goods under construction in the process of the Company's
performance, the Company takes them as the performance obligations within a certain period
of time, and recognizes the income according to the performance progress, except that the
performance progress cannot be reasonably determined. The Company determines the
performance schedule of providing construction services according to the input method. The
performance schedule shall be determined according to the proportion of the actual contract
cost to the estimated total contract cost.
④ Real estate sales contract
The income of the Company's real estate development business is recognized when the
control of the property is transferred to the customer. The income is recognized when the
customer obtains the physical ownership or legal ownership of the completed property and the
Company has obtained the current right of collection and is likely to recover the consideration.
When confirming the contract transaction price, if the financing component is significant, the
Company will adjust the contract commitment consideration according to the financing
component of the contract.
(1) Government subsidy
Government subsidies are recognized when the following conditions are met:
① Requirements attached to government subsidies;
China Fangda Group Co., Ltd. Notes to Financial Statements
② The company can receive government subsidies.
(2) Government subsidy
When a government subsidy is monetary capital, it is measured at the received or
receivable amount. None monetary capital are measured at fair value; if no reliable fair value
available, recognized at RMB1.
(3) Recognition of government subsidies
① Assets-related
Government subsidies related to assets are obtained by the Company to purchase, build
or formulate in other manners long-term assets; or subsidies related to benefits. If the
asset-related government subsidy is recognized as deferred gain, should be recorded in gain
and loss in the service life. Government subsidy measured at the nominal amount is accounted
into current income account. If the relevant assets are sold, transferred, scrapped or damaged
before the end of their useful life, the unallocated relevant deferred income balance shall be
transferred to the profit and loss of the current period of disposition of the assets.
② Gain-related government subsidy should be accounted as follows:
The Company divides government subsidies into assets-related and earnings-related
government subsidies. Gain-related government subsidy should be accounted as follows:
Subsidy that will be used to compensate related future costs or losses should be
recognized as deferred gain and recorded in the gain and loss of the current report and offset
related cost;
Subsidy that is used to compensate existing cost or loss should be recorded in the gain
and loss of the current period or offset related cost.
For government subsidies that include both asset-related and income-related parts,
separate different parts for accounting treatment; It is difficult to distinguish between the
overall classification of government subsidies related to benefits.
Government subsidy related to routine operations should be recorded in other gains or
offset related cost. Government subsidy not related to routine operations should be recorded
in non-operating income or expense.
③ Policy preferential loan discount
China Fangda Group Co., Ltd. Notes to Financial Statements
The policy-based preferential loan obtained has interest subsidy. If the government
allocates the interest-subsidy funds to the lending bank, the loan amount actually received will
be used as the entry value of the loan, and the borrowing cost will be calculated based on the
loan principal and policy-based preferential interest rate.
If the government allocates the interest-bearing funds directly to the Group, discount
interest will offset the borrowing costs.
④ Government subsidy refund
When a confirmed government subsidy needs to be returned, the book value of the asset
is adjusted against the book value of the relevant asset at initial recognition. If there is a
related deferred income balance, the book balance of the related deferred income is written off
and the excess is credited to the current profit or loss; In other cases, it is directly included in
the current profit and loss.
The Company uses the temporary difference between the book value of the assets and
liabilities on the balance sheet day and the tax base and the liabilities method to recognize the
deferred income tax. 26. Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets
For deductible temporary discrepancies, deductible losses and tax offsets that can be
carried forward for future years, the impact on income tax is calculated at the estimated
income tax rate for the transfer-back period and the impact is recognized as deferred income
tax assets, provided that the Company is likely to obtain future taxable income for deductible
temporary discrepancies, deductible losses and tax offsets.
At the same time, the impact on income tax of deductible temporary discrepancies
resulting from the initial recognition of assets or liabilities in transactions or matters with the
following characteristics is inconclusive as deferred income tax assets:
A. The transaction is not a business combination;
B. the transaction is not a merger and the transaction does not affect the accounting profit
or taxable proceeds;
However, for individual transactions that simultaneously meet the above two conditions
China Fangda Group Co., Ltd. Notes to Financial Statements
and result in equal taxable temporary differences and deductible temporary differences upon
initial recognition of assets and liabilities, the exemption from initial recognition of deferred
tax liabilities and deferred tax assets does not apply. For taxable temporary differences and
deductible temporary differences arising from the initial recognition of assets and liabilities in
such transactions, the Company recognizes the corresponding deferred tax liabilities and
deferred tax assets at the time of the transaction.
In the event of temporary discrepancy of deductible investment related to subsidiaries,
joint ventures and joint ventures, and meeting the following two conditions, the amount of
impact (talent) on income tax shall be deemed as deferred income tax assets:
A. Temporary discrepancies are likely to be reversed in the foreseeable future;
B. In the future, it is likely to obtain taxable income that can be used to offset the
deductible temporary differences;
On the balance sheet date, if there is conclusive evidence that sufficient taxable income
is likely to be obtained in the future to offset the deductible temporary differences, the
deferred income tax assets that have not been recognized in the previous period are
recognized.
On the balance sheet day, the Company re-examines the book value of the deferred
income tax assets. If it is unlikely to have adequate taxable proceeds to reduce the benefits of
the deferred income tax assets, less the deferred income tax assets' book value. When there is
adequate taxable proceeds, the lessened amount will be reversed.
(2) Deferred income tax assets
All provisional differences in taxable income of the Company shall be measured on the
basis of the estimated income tax rate for the period of transfer-back and shall be recognized
as deferred income tax liabilities, except that:
At the same time, the impact on income tax of deductible temporary discrepancies
resulting the initial recognition of assets or liabilities in transactions or matters with the
following characteristics is inconclusive as deferred income tax Liabilities:
A. Initial recognition of goodwill;
B. Initial recognition of goodwill, or of assets or liabilities generated in transactions with
the following features: the transaction is not a merger and the transaction does not affect the
China Fangda Group Co., Ltd. Notes to Financial Statements
accounting profit or taxable proceeds;
② In the event of temporary discrepancy of deductible investment related to subsidiaries,
Joint venture joint ventures, and meeting the two conditions, the amount of impact (talent) on
income tax shall be deemed as deferred income tax assets:
A. The Company is able to control the time of temporary discrepancy transfers;
B Temporary discrepancies are likely to be reversed in the foreseeable future;
(3) Deferred income tax assets
(1) Deferred income tax liabilities or assets associated with enterprise consolidation
Temporary difference of taxable tax or deductible temporary difference generated by
enterprise merger under non-same control. When deferred income tax liability or deferred
income tax asset is recognized, related deferred income tax expense (or income) is usually
adjusted as recognized goodwill in enterprise merger.
② Amount of shares paid and accounted as owners' equity
Except for the adjustment goodwill generated by mergers or deferred income tax related
to transactions or events directly accounted into the owners' equity, income tax is accounted
as income tax expense into the current gain/loss account. The effects of temporary
discrepancy on income tax include the following: Other integrated benefits such as fair value
change of financial assets available for sale, retroactive adjustment of accounting policy
changes or retroactive restatement of accounting error correction discrepancy to adjust the
initial retained income, and mixed financial instruments including liabilities and equity.
(3) Compensation for losses and tax deductions
A. Compensable losses and tax deductions from the Company's own operations
Deductible losses refer to the losses calculated and determined in accordance with the
provisions of the tax law that are allowed to be made up with the taxable income of
subsequent years. The uncovered losses (deductible losses) and tax deductions that can be
carried forward in accordance with the tax law are treated as deductible temporary differences.
When it is expected that sufficient taxable income is likely to be obtained in the future period
when it is expected to be available to make up for losses or tax deductions, the corresponding
deferred income tax assets are recognized within the limit of the taxable income that is likely
China Fangda Group Co., Ltd. Notes to Financial Statements
to be obtained, while reducing the current period Income tax expense in the income statement.
B. Compensable uncovered losses of the merged company due to business merger
In a business combination, if the Company obtains the deductible temporary difference
of the purchased party and does not meet the deferred income tax asset recognition conditions
on the purchase date, it shall not be recognized. Within 12 months after the purchase date, if
new or further information is obtained indicating that the relevant conditions on the purchase
date already exist, and the economic benefits brought about by the temporary difference are
expected to be deducted on the purchase date, confirm the relevant delivery. Deferred income
tax assets, while reducing goodwill, if the goodwill is not enough to offset, the difference is
recognized as the current profit and loss; except for the above circumstances, the deferred tax
assets related to the business combination are recognized and included in the current profit
and loss.
④Temporary difference caused by merger offset
If there is a temporary difference between the book value of assets and liabilities in the
consolidated balance sheet and the taxable basis of the taxpayer due to the offset of the
unrealized internal sales gain or loss, the deferred income tax asset or the deferred income tax
liability is confirmed in the consolidated balance sheet, and the income tax expense in the
consolidated profit statement is adjusted, with the exception of the deferred income tax related
to the transaction or event directly included in the owner's equity and the merger of the
enterprise.
⑤ Share payment settled by equity
If the tax law provides for allowable per-tax deduction of expenses related to share
payment, within the period for which the cost and expense are recognized in accordance with
the accounting standards, the Company shall calculate the tax basis and temporary
discrepancy based on the estimated per-tax deduction amount at the end of the accounting
period and confirm the relevant deferred income tax if it meets the conditions for
confirmation. Of these, the amount that can be deducted before tax in the future exceeds the
cost related to share payment recognized in accordance with the accounting standards, and the
excess income tax shall be directly included in the owner's equity.
⑥ Dividends related to financial instruments classified as equity instruments
China Fangda Group Co., Ltd. Notes to Financial Statements
For financial instruments classified as equity instruments where the Company is the
issuer, any dividend expenditure that is deductible for corporate income tax purposes
according to tax policy is recognized for its income tax impact when the dividends payable
are recognized. If the distributed profits originate from transactions or events previously
affecting profit or loss, the income tax impact of such dividends is included in the current
profit or loss. If the distributed profits originate from transactions or events previously
recognized in equity, the income tax impact of such dividends is included in equity items.
(4) Basis for presentation of deferred tax assets and deferred tax liabilities on a net
basis
The deferred income tax assets and deferred income tax liabilities of the company are
presented as a net amount after offsetting when the following conditions are met
simultaneously:
① The Company has a legal right to offset current income tax assets against current
income tax liabilities on a net basis;
② Deferred income tax assets and deferred income tax liabilities relate either to income
taxes levied by the same tax authority on the same taxable entity, or to different taxable
entities, provided that in each material future period when these deferred tax assets and
liabilities are expected to reverse, the entities involved intend either to settle current income
tax assets and liabilities on a net basis or to realize the assets and settle the liabilities
simultaneously.
(1) Identification of lease
On the commencement date of the contract, the company evaluates whether the contract
is a lease or includes a lease. If one party in the contract transfers the right to control the use
of one or more identified assets within a certain period in exchange for consideration, the
contract is a lease or includes a lease. In order to determine whether the contract transfers the
right to control the use of the identified assets within a certain period, the company evaluates
whether the customers in the contract have the right to obtain almost all the economic benefits
arising from the use of the identified assets during the use period, and have the right to
dominate the use of the identified assets during the use period.
China Fangda Group Co., Ltd. Notes to Financial Statements
(2) Separate identification of lease
If the contract includes multiple separate leases at the same time, the company will split
the contract and conduct accounting treatment for each separate lease. If the following
conditions are met at the same time, the right to use the identified asset constitutes a separate
lease in the contract: ① the lessee can profit from using the asset alone or together with
other easily available resources; ② The asset is not highly dependent or highly related to
other assets in the contract.
(3) Accounting treatment method of the Company as lessee
On the beginning date of the lease term, the Company recognizes the lease with a lease
term of no more than 12 months and excluding the purchase option as a short-term lease;
When a single leased asset is a brand-new asset, the lease with lower value is recognized as a
low value asset lease. If the Company sublets or expects to sublet the leased assets, the
original lease is not recognized as a low value asset lease.
For all short-term leases and low value asset leases, the Company will record the lease
payment amount into the relevant asset cost or current profit and loss according to the
straight-line method (or other systematic and reasonable methods) in each period of the lease
term.
In addition to the above short-term leases and low value asset leases with simplified
treatment, the Company recognizes the right to use assets and lease liabilities for the lease on
the beginning date of the lease term.
① Use right assets
The term "right to use assets" refers to the right of the lessee to use the leased assets
during the lease term.
At the beginning of the lease term, the right of use assets are initially measured at cost.
This cost includes:
• The initial measurement amount of lease liabilities;
• For the lease payment paid on or before the beginning of the lease term, if there is
lease incentive, the relevant amount of lease incentive enjoyed shall be deducted;
• Initial direct expenses incurred by the lessee;
China Fangda Group Co., Ltd. Notes to Financial Statements
• The estimated cost incurred by the lessee for dismantling and removing the leased
assets, restoring the site where the leased assets are located or restoring the leased
assets to the state agreed in the lease terms. The Company recognizes and measures
the cost according to the recognition standard and measurement method of estimated
liabilities. See Note III 25 for details. If the above costs are incurred for the
production of inventories, they will be included in the cost of inventories.
Depreciation of right of use assets is accrued by using the straight-line method. If it can
be reasonably determined that the ownership of the leased asset will be obtained at the
expiration of the lease term, the depreciation rate shall be determined according to the asset
category of the right to use and the estimated net residual value rate within the expected
remaining service life of the leased asset; If it is impossible to reasonably determine that the
ownership of the leased asset will be obtained at the expiration of the lease term, the
depreciation rate shall be determined according to the asset category of the right of use within
the shorter of the lease term and the remaining service life of the leased asset.
② Lease liabilities
The lease liabilities are initially measured Company shall according to the present value
of the unpaid lease payments at the beginning of the lease term. The lease payment includes
the following five items:
• Fixed payment amount and substantial fixed payment amount. If there is lease
incentive, the relevant amount of lease incentive shall be deducted;
• Variable lease payments depending on index or ratio;
• The exercise price of the purchase option, provided that the lessee reasonably
determines that the option will be exercised;
• The amount to be paid for exercising the option to terminate the lease, provided that
the lease term reflects that the lessee will exercise the option to terminate the lease;
• The amount expected to be paid according to the residual value of the guarantee
provided by the lessee.
When calculating the present value of lease payments, the implicit interest rate of the
lease is used as the discount rate. If the implicit interest rate of the lease cannot be determined,
China Fangda Group Co., Ltd. Notes to Financial Statements
the incremental borrowing interest rate of the company is used as the discount rate. The
difference between the lease payment amount and its present value is regarded as
unrecognized financing expenses, and the interest expenses are recognized according to the
discount rate of the present value of the lease payment amount during each period of the lease
term and included in the current profit and loss. The amount of variable lease payments not
included in the measurement of lease liabilities shall be included in the current profit and loss
when actually incurred.
After the beginning date of the lease term, when the actual fixed payment amount
changes, the expected payable amount of the guaranteed residual value changes, the index or
ratio used to determine the lease payment amount changes, the evaluation results or actual
exercise of the purchase option, renewal option or termination option changes, the Company
remeasures the lease liability according to the present value of the changed lease payment
amount, And adjust the book value of the right to use assets accordingly.
(4) Accounting treatment method of the Company as lessor
On the lease commencement date, the Company classifies leases that have substantially
transferred almost all the risks and rewards related to the ownership of the leased assets as
financial leases, and all other leases are operating leases.
Operating lease
During each period of the lease term, the Company recognizes the lease receipts as rental
income according to the straight-line method, and the initial direct expenses incurred are
capitalized, amortized on the same basis as the recognition of rental income, and included in
the current profit and loss by stages. The variable lease payments obtained by the Company
related to operating leases that are not included in the lease receipts are included in the current
profits and losses when actually incurred.
Finance lease
On the lease beginning date, the Company recognizes the financial lease receivables
according to the net amount of the lease investment (the sum of the unsecured residual value
and the present value of the lease receipts not received on the lease beginning date discounted
according to the lease embedded interest rate), and terminates the recognition of the financial
lease assets. During each period of the lease term, the Company calculates and recognizes the
interest income according to the interest rate embedded in the lease.
China Fangda Group Co., Ltd. Notes to Financial Statements
The amount of variable lease payments obtained by the Company that are not included in
the measurement of net lease investment shall be included in the current profit and loss when
actually incurred.
(5) Accounting treatment of lease change
① Change of lease as a separate lease
If the lease changes and meets the following conditions at the same time, the Company
will treat the lease change as a separate lease for accounting: a. the lease change expands the
lease scope by increasing the use right of one or more leased assets; B. The increased
consideration is equivalent to the amount adjusted according to the conditions of the contract
at the separate price for most of the expansion of the lease scope.
② The lease change is not treated as a separate lease
A. The Company as lessee
On the effective date of the lease change, the Company reconfirmed the lease term and
discounted the changed lease payment at the revised discount rate to re-measure the lease
liability. When calculating the present value of the lease payment after the change, the implicit
interest rate of the lease during the remaining lease period shall be used as the discount rate; If
it is impossible to determine the implicit interest rate of the lease for the remaining lease
period, the incremental loan interest rate on the effective date of the lease change shall be
used as the discount rate.
The impact of the above lease liability adjustment shall be accounted for according to the
following circumstances:
• If the lease scope is reduced or the lease term is shortened due to the lease change,
the book value of the right to use assets shall be reduced, and the relevant gains or
losses of partial or complete termination of the lease shall be included in the current
profits and losses;
• For other lease changes, the book value of the right to use assets shall be adjusted
accordingly.
The Company as leasor
If the operating lease is changed, the Company will treat it as a new lease for accounting
China Fangda Group Co., Ltd. Notes to Financial Statements
from the effective date of the change, and the amount of lease receipts received in advance or
receivable related to the lease before the change is regarded as the amount of new lease
receipts.
If the change of financial lease is not accounted for as a separate lease, the Company will
deal with the changed lease under the following circumstances: if the change of lease takes
effect on the lease commencement date and the lease will be classified as an operating lease,
the Company will account for it as a new lease from the effective date of lease change, and
take the net lease investment before the effective date of lease change as the book value of
leased assets; If the lease change takes effect on the lease commencement date, the lease will
be classified as a financial lease, and the Company will conduct accounting treatment in
accordance with the provisions on modifying or renegotiating the contract.
(6) Sale and lease-back
The company evaluates and determines whether the asset transfer in the sale and
leaseback transaction is a sale in accordance with the provisions of Note III 26.
① The Company as seller (lessee)
If the asset transfer in the sale and leaseback transaction does not belong to sales, the
Company will continue to recognize the transferred asset, recognize a financial liability equal
to the transfer income, and conduct accounting treatment for the financial liability in
accordance with Note III 11. If the asset transfer belongs to sales, the Company measures the
right to use assets formed by sale and leaseback according to the part of the book value of the
original assets related to the right to use obtained by leaseback, and only recognizes the
relevant gains or losses on the rights transferred to the lessor.
② The Company as buyer (lessor)
If the asset transfer in the sale and leaseback transaction is not sales, the company does
not recognize the transferred asset, but recognizes a financial asset equal to the transfer
income, and carries out accounting treatment for the financial asset in accordance with Note
III 11. If the asset transfer belongs to sales, the Company shall conduct accounting treatment
for asset purchase and asset lease in accordance with other applicable accounting standards
for business enterprises.
China Fangda Group Co., Ltd. Notes to Financial Statements
(1) Classification of inventories
The Company divides its hedging strategies into fair value hedges, cash flow hedges, and
net investment hedges.
① Fair value hedge. It refers to hedging activities conducted to mitigate the risk of
changes in the fair value of recognized assets or liabilities, unrecognized firm commitments,
or components of the aforementioned items. The fair value changes are caused by specific
risks that will impact the Company's profit or other comprehensive income.
① Cash flow hedging refers to the hedging of cash flow risk. The change in cash flow is
derived from specific risks associated with recognized assets or liabilities, expected
transactions that are likely to occur, or with respect to the components of the above-mentioned
project and will affect the profits and losses of the enterprise.
③ Net investment hedge for overseas operations refers to hedging activities conducted
to mitigate the foreign exchange risk exposure of the net investment in overseas operations.
The hedged risk in the net investment hedge is the translation difference between the
functional currency of the overseas operations and the reporting currency of the parent
company.
(2) Hedging tools and hedged projects
Hedging means a financial instrument designated by the Company for the purpose of
hedging, whose fair value or cash flow variation is expected to offset the fair value or cash
flow variation of the hedged item, including:
① Financial liabilities measured at fair value with variations accounted into current
income account Check-out options can only be used as a hedging tool if the option is hedged,
including those embedded in a hybrid contract. Derivatives embedded in a hybrid contract but
not split cannot be used as separate hedging tools.
② Non-derivative financial assets or non-derivative financial liabilities that are
measured at fair value and whose changes are included in the current profit and loss, but
designated as fair value and whose changes are included in the current profit and loss, and
their own credit risk changes caused by changes in fair value except for financial liabilities
included in other comprehensive income.
China Fangda Group Co., Ltd. Notes to Financial Statements
Own equity instruments are not financial assets or financial liabilities and cannot be used
as hedging instruments.
A hedged item refers to an item that exposes the Company to the risk of changes in fair
value or cash flow and is designated as the hedged object and can be reliably measured. The
Company designates the following individual projects, project portfolios or their components
as hedged projects:
① Confirmed assets or liabilities.
② Confirmed commitments that have not yet been confirmed. Confirmed commitment
refers to a legally binding agreement to exchange a specific amount of resources at an agreed
price on a specific date or period in the future.
③ Expected transactions that are likely to occur. Anticipated transactions refer to
transactions that have not yet been committed but are expected to occur.
④ Net investment in overseas operations.
The above-mentioned project components refer to the parts that are less than the overall
fair value or cash flow changes of the project. The Company designates the following project
components or their combinations as hedged items:
① The part of the change in fair value or cash flow (risk component) that is only caused
by one or more specific risks in the overall fair value or cash flow changes of the project.
According to the assessment in a specific market environment, the risk component should be
able to be individually identified and reliably measured. The risk component also includes the
part where the fair value or cash flow of the hedged item changes only above or below a
specific price or other variables.
② One or more selected contractual cash flows.
③ The component of the nominal amount of the project, that is, the specific part of the
whole amount or quantity of the project, may be a certain proportion of the whole project, or
may be a certain level of the whole project. If a certain level includes early repayment rights
and the fair value of the early repayment rights is affected by changes in the risk of the hedge,
the level shall not be designated as the hedged item of the fair value hedge, but in the
measurement of the hedged item except when the fair value has included the influence of the
China Fangda Group Co., Ltd. Notes to Financial Statements
prepayment right.
(3) Evaluation of hedging relationship
When the hedging relationship is initially specified, the Group officially specifies the
related hedging relationships with official documents recording the hedging relationships, risk
management targets and hedging strategies. This document sets out the hedging tools, hedged
items, the nature of hedged risks, and the Company's assessment of hedged effectiveness.
Hedging means a financial instrument designated by the Company for the purpose of hedging,
whose fair value or cash flow variation is offset the fair value or cash flow variation of the
hedged item, including: Such hedges are continuously evaluated on and after the initial
specified date to meet the requirements for hedging validity.
If the hedging instrument has expired, been sold, the contract is terminated or exercised
(but the extension or replacement as part of the hedging strategy is not treated as expired or
contract termination), or the risk management objective changes, resulting in hedging The
relationship no longer meets the risk management objectives, or the economic relationship
between the hedged item and the hedging instrument no longer exists, or the impact of credit
risk begins to dominate in the value changes caused by the economic relationship between the
hedged item and the hedging instrument, or when the hedge no longer meets the other
conditions of the hedge accounting method, the Company terminates the use of hedge
accounting.
If the hedging relationship no longer meets the requirements for hedging effectiveness
due to the hedging ratio, but the risk management objective of the designated hedging
relationship has not changed, the Company shall rebalance the hedging relationship.
(4) Revenue the of revenue recognition and measurement
If the conditions for applying hedge accounting method are met, it shall be handled
according to the following methods:
① Fair value hedging
Gains or losses arising from hedging instruments are recognized in the current period's
income statement. If the hedging is conducted for specified non-derivative equity investments
(or components thereof) measured at fair value with changes in fair value recognized in other
comprehensive income, gains or losses from the hedging instruments are recognized in other
China Fangda Group Co., Ltd. Notes to Financial Statements
comprehensive income. Gains or losses arising from the hedged items due to the hedging risk
exposure are recognized in the income statement. At the same time, the carrying amount of
the designated hedged items that are not measured at fair value is adjusted. If the hedged item
is a specified non-derivative equity investment (or component thereof) measured at fair value
with changes in fair value recognized in other comprehensive income, gains or losses
resulting from the hedging risk exposure are recognized in other comprehensive income, and
the carrying amount of the hedged item has already been measured at fair value and does not
require adjustment.
Regarding fair value hedges related to financial instruments (or components thereof)
measured at amortized cost, any adjustments made to the carrying amount of the hedged item
are amortized using the effective interest rate recalculated from the date of the
commencement of amortization and recognized in the income statement. The amortization
date for adjustments should begin from the adjustment date and should not be later than the
point at which hedging gains and losses are adjusted upon termination of the hedged item. For
hedged items that are financial assets (or components thereof) measured at fair value with
changes in fair value recognized in other comprehensive income, the accumulated hedging
gains or losses should be amortized in the same manner and recognized in the income
statement. However, the carrying amount of the financial assets (or components thereof)
should not be adjusted.
For hedged items that are unrecognized firm commitments (or components thereof), the
cumulative fair value changes caused by the hedging risk after the hedging relationship is
designated should be recognized as an asset or liability. The related gains or losses should be
recognized in the income statement. When fulfilling a firm commitment and acquiring an
asset or assuming a liability, the initial recognized amount of the asset or liability should be
adjusted to include the cumulative fair value changes of the designated hedged item that have
been recognized.
② Cash flow hedging
The part of hedging tool gains or losses that is valid for hedging is recognized as other
comprehensive income as a cash flow hedging reserve, and the part that is invalid for hedging
(that is, other gains or losses after deducting other comprehensive income), are counted Into
the current profit and loss. The amount of cash flow hedging reserve is determined according
China Fangda Group Co., Ltd. Notes to Financial Statements
to the lower of the absolute amounts of the following two items: ① accumulated gains or
losses of hedging instruments since the hedging. The amount in the effective arbitrage is
recognized by the accumulative gains or losses from the starting of arbitrage and
accumulative changes to the current value of future forecast cash flows from the start of
arbitrage.
If the expected transaction of the hedged asset is subsequently recognized as a
non-financial asset or non-financial liability, or if the expected transaction of the non-financial
asset or non-financial liability forms a defined commitment to the applicable fair value hedge
accounting, the amount of the cash flow hedge reserve originally recognized in the other
consolidated income is transferred out to account for the initial recognized amount of the asset
or liability. For the remaining cash flow hedges, during the same period when the expected
cash flow to be hedged affects the profit and loss, if the expected sales occur, the cash flow
hedge reserve recognized in other comprehensive income is transferred out and included in
the current profit and loss.
③ Net investment in overseas operations hedge
For hedging of foreign operation net investments, the portion of gains or losses from the
hedging instruments that qualify as effective hedges is directly recognized in other
comprehensive income. The portion of gains or losses from the hedging instruments that do
not qualify as effective hedges is recognized in the income statement. Upon disposal of the
foreign operation, the previously recognized gains or losses from the hedging instruments
reflected in other comprehensive income are reclassified to the income statement.
The Company continuously reviews significant accounting judgment and estimate
adopted for the reasonable forecast of future events based on its historical experience and
other factors. Significant accounting judgment and assumptions that may lead to major
adjustment of the book value of assets and liabilities in the next accounting year are listed as
follows:
Classification of financial assets
The major judgments involved in the classification of financial assets include the
analysis of business model and contract cash flow characteristics.
China Fangda Group Co., Ltd. Notes to Financial Statements
The company determines the business mode of managing financial assets at the level of
financial asset portfolio, taking into account such factors as how to evaluate and report
financial asset performance to key managers, the risks that affect financial asset performance
and how to manage it, and how to obtain remuneration for related business managers.
When the company assesses whether the contractual cash flow of financial assets is
consistent with the basic borrowing arrangement, there are the following main judgments:
whether the principal may change due to early repayment and other reasons during the
duration of the period or the amount of change; whether the interest Including the time value
of money, credit risk, other basic borrowing risks, and consideration of costs and profits. For
example, does the amount paid in advance reflect only the unpaid principal and the interest
based on the unpaid principal, as well as the reasonable compensation paid for early
termination of the contract.
Measurement of expected credit losses of accounts receivable
The Company calculates the expected credit loss of accounts receivable through the risk
exposure of accounts receivable default and the expected credit loss rate, and determines the
expected credit loss rate based on the default probability and the default loss rate. When
determining the expected credit loss rate, the Company uses internal historical credit loss
experience and other data, combined with current conditions and forward-looking information
to adjust the historical data. When considering forward-looking information, the indicators
used by the Company include the risks of economic downturn, changes in the external market
environment, technological environment, and customer conditions. The Company regularly
monitors and reviews assumptions related to the calculation of expected credit losses.
Deferred income tax assets
If there is adequate taxable profit to deduct the loss, the deferred income tax assets
should be recognized by all the unused tax loss. This requires the management to make a lot
of judgment to forecast the time and amount of future taxable profit and determine the amount
of the deferred tax assets based on the taxation strategy.
Income recognition
The Company's revenue from providing curtain wall construction and metro platform
screen door installation services is recognized over a period of time. The recognition of the
income and profit of such engineering installation services depends on the Company's
China Fangda Group Co., Ltd. Notes to Financial Statements
estimation of the contract results and performance progress. If the actual amount of total
revenue and total cost is higher or lower than the estimated value of the management, it will
affect the amount of revenue and profit recognition of the Company in the future.
Engineering contract
The management shall make relevant judgment to confirm the income and expenses of
project contracting business according to the performance progress. If losses are expected to
occur in the project contract, such losses shall be recognized as current expenses. The
management of the Company estimates the possible losses according to the budget of the
project contract. The Company determines the transaction price according to the terms of the
contract and in combination with previous customary practices, and considers the influence of
variable consideration, major financing components in the contract and other factors. During
the performance of the contract, the Company continuously reviews the estimated total
contract revenue and the estimated total contract cost. When the initial estimate changes, such
as contract changes, claims and awards, the estimated total contract revenue and the estimated
total contract cost are revised. When the estimated total contract cost exceeds the total
contract revenue, the main business cost and estimated liabilities shall be recognized
according to the loss contract to be executed.
Estimate of fair value
The Company uses fair value to measure investment real estate and needs to estimate the
fair value of investment real estate at least quarterly. This requires the management to
reasonably estimate the fair value of the investment real estate with the help of valuation
experts.
Development cost
For property that has been handed over with income recognized, but whose public
facilities have not been constructed or not been completed, the management will estimate the
development cost for the part that has not been started according to the budget to reflect the
operation result of the property sales.
(1) Changes in accounting policies
During the current reporting period, the Company did not effect any significant changes
China Fangda Group Co., Ltd. Notes to Financial Statements
in accounting policies.
(2) Changes in major accounting estimates
Effective Statement item Affected
Account policy changes and reasons
time materially affected amount
With the development of businesses across Account receivable -12,480,875.74
various industries, the Company has
continuously refined its customer risk Contract assets
management for different sectors and (including the portion
-10,411,746.48
enhanced its management capabilities. reclassified to other
Based on a comprehensive assessment of non-current assets)
the composition of receivables (including Notes receivable -12,572,159.65
notes receivable, accounts receivable,
contract assets, and other receivables) Other receivables -3,311,535.99
related to curtain wall, platform screen Credit impairment ("-"
door, new materials, new energy, and for loss) -28,364,571.38
commercial real estate businesses, as well
as differences in customer risk profiles and Investment impairment
historical credit loss experience, the December loss ("-" for loss) -10,411,746.48
Company has changed its accounting 01, 2025
estimates. This change is made prudently,
in accordance with Accounting Standards
for Business Enterprises No.
Financial Instruments, No. 28—Changes in
Accounting Policies, Changes in
Accounting Estimates and Correction of Total profit -38,776,317.86
Errors, and other relevant provisions, and is
aligned with the actual business
characteristics and operating conditions, in
order to present the Company's financial
position and operating results more
objectively and fairly.
Note: On April 3, 2026, the Company convened the 14th meeting of the Audit
Committee of the 10th Board of Directors and the 16th meeting of the 10th Board of Directors,
which reviewed and approved the proposal regarding the current change in accounting
estimate, and resolved to implement the change effective December 1, 2025.
IV. Taxation
Tax Tax basis Tax rate %
VAT Taxable income 1, 3, 5, 6, 9, and 13
City maintenance
and construction Taxable turnover 1, 5, 7
tax
Education surtax Taxable turnover 3
Local education
Taxable turnover 2
surtax
China Fangda Group Co., Ltd. Notes to Financial Statements
Tax Tax basis Tax rate %
For ad valorem assessment, the tax is levied at 1.2% of
the residual value after a one-time deduction of 30% from
Property tax 1.2, 12
the original value of the property; for rental-based
assessment, the tax is levied at 12% of rental income.
Enterprise income
Taxable income See the following table
tax
Existence of different corporate income tax rates for the Company's subsidiaries
Income tax
Tax payer
rate
The Company 25%
Shenzhen Fangda Construction Technology Co., Ltd. (hereinafter Fangda Construction
Technology)
Fangda Zhiyuan Technology Co., Ltd. (hereinafter Fangda Zhiyuan) 15%
Fangda New Material (Jiangxi) Co., Ltd. (hereinafter Fangda Jiangxi New Material) 25%
Jiangxi Fangda Intelligent Manufacturing Technology Co., Ltd. (hereinafter referred to
as Fangda Intelligent Manufacturing Company)
Chengdu Fangda Construction Technology Co., Ltd. (hereinafter Fangda Chengdu
Technology)
Shanghai Fangda Zhijian Technology Co., Ltd. (hereinafter referred to as Fangda
Shanghai Zhijian company)
Shenzhen Fangda Yunzhu Technology Co., Ltd. (hereinafter Fangda Yunzhu) 15%
Dongguan Fangda New Material Co., Ltd. (hereinafter Fangda Dongguan New
Material)
Shanghai Fangda Jianzhi Technology Co., Ltd. (hereinafter Fangda Shanghai Jianzhi) 25%
Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property
Development)
Shenzhen Fangda New Energy Co., Ltd. (hereinafter Fangda New Energy) 25%
Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property
Development)
Jiangxi Fangda Property Development Co., Ltd. (hereinafter Fangda Jiangxi Property
Development)
Pingxiang Fangda Luxin New Energy Co., Ltd. (hereinafter Fangda Luxin New
Energy)
Nanchang Xinjian Fangda New Energy Co., Ltd. (hereinafter Fangda Xinjian New
Energy)
Dongguan Fangda New Energy Co., Ltd. (hereinafter Fangda Dongguan New Energy) 20%
Shenzhen Qianhai Kechuangyuan Software Co., Lt.d (hereinafter Kechuangyuan
Software)
Fangda Zhiyuan Technology (Hong Kong) Co., Ltd, (Fangda Zhiyuan Hong Kong) 16.50%
Fangda Zhiyuan Technology (Wuhan) Co., Ltd, (Fangda Wuhan Zhiyuan) 25%
Fangda Zhiyuan Technology (Nanchang) Co., Ltd, (Fangda Nanchang Zhiyuan) 25%
Fangda Zhiyuan Railway Transportation Equipment (Dongguan) Co., Ltd. (hereinafter
referred to as Fangda Zhiyuan Dongguan)
General Rail Technology Private Limited 17%
Shihui International Holding Co., Ltd. (hereinafter Fangda Shihui International) 0.00%
China Fangda Group Co., Ltd. Notes to Financial Statements
Income tax
Tax payer
rate
Shenzhen Fangda Investment & Holding Co., Ltd. (hereinafter referred to as "Fangda
Investment & Holding")
Fangda Australia Pty Ltd 30%
Shenzhen Fangda Yunzhi Technology Co., Ltd. (hereinafter Fangda Yunzhi) 25%
Shenzhen Zhongrong Litai Investment Co., Ltd. (hereinafter referred to as "Zhongrong
Litai")
Chengdu Fangda Curtain Wall Technology Co., Ltd. (hereinafter Fangda Chengdu
Curtain Wall)
Fangda Southeast Asia Co., Ltd. (hereinafter Fangda Southeast Asia) 20%
Fangda Construction Technology (Hong Kong) Co., Ltd. (hereinafter Fangda
Construction Technology Hong Kong)
Shenzhen Yunzhu Testing Technology Co., Ltd. (Hereinafter Fangda Yunzhu Testing) 20%
Shenzhen Fangda Jianchuang Technology Co., Ltd. (hereinafter Fangda Jianchuang) 25%
Shenzhen Fangda Construction Technology Co., Ltd. (hereinafter referred to as Fangda
Construction Technology Company)
Fangda Facade Singapore Pte Ltd (hereinafter referred to as Curtain Wall Singapore
Company)
FANGDA FACADE PHILIPPINES INC. (hereinafter referred to as Curtain Wall
Philippines Company)
GENERAL RAIL TECHNOLOGY PHILIPPINES, INC.
(hereinafter referred to as Zhiyuan Philippines Company)
FANGDA GULF DMCC (hereinafter referred to as Curtain Wall Gulf Company) 9%
FANGDA FACADE CONTRACTING L.L.C (hereinafter referred to as "Fangda
Facade UAE")
Fangda Facade (NSW) Pty Ltd (hereinafter referred to as "Fangda Facade Sydney") 30%
GLOBAL MEGA INTERNATIONAL HOLDINGS LIMITED
(hereinafter referred to as GLOBAL MEGA INTERNATIONAL)
(1) On December 26, 2024, the subsidiary Fangda Construction Technology obtained the
certificate of high-tech enterprise jointly issued by the Industry and Information Technology
Bureau of Shenzhen Municipality, Shenzhen Finance Bureau, State Administration of
Taxation and Shenzhen Taxation Bureau. The certificate number is GR202444207062. Within
three years after obtaining the qualification of high-tech enterprise (from 2024 to 2026), the
income tax will be levied at 15%.
(2) On December 26, 2024, the subsidiary Fangda Zhiyuan Technology Co., Ltd.
obtained the certificate of high tech enterprise jointly issued by the Industry and Information
Technology Bureau of Shenzhen Municipality, Shenzhen Finance Bureau, State
Administration of Taxation and Shenzhen Taxation Bureau. The certificate number is
GR202444201506. Within three years after obtaining the qualification of high tech enterprise
China Fangda Group Co., Ltd. Notes to Financial Statements
(from 2024 to 2026), the income tax will be levied at 15%.
(3) On October 16, 2023, the subsidiary Fangda Chengdu Technology obtained the
certificate of high tech enterprise No. GR202351000927 jointly issued by the Department of
Science and Technology of Sichuan Province, the Department of Finance of Sichuan Province,
the State Administration of Taxation and the Sichuan Provincial Taxation Bureau. Within
three years after obtaining the qualification of high tech enterprise (2023-2025), the income
tax will continue to be levied at 15%.
(4) On November 15, 2023, the subsidiary Fangda Shanghai Zhijian obtained the
certificate of high tech enterprise GR202331002267 jointly issued by Shanghai Science and
Technology Commission, Shanghai Finance Bureau and Shanghai Taxation Bureau. Within
three years (from 2023 to 2025) after obtaining the qualification of high tech enterprise, the
income tax will continue to be charged at 15%.
(5) On November 15, 2023, the subsidiary Fangda Yunzhu Co., Ltd. obtained the
certificate of high tech enterprise jointly issued by Shenzhen Science and Technology
Innovation Commission, Shenzhen Finance Bureau, State Administration of Taxation and
Shenzhen Taxation Bureau. The certificate number is GR202344205791. Within three years
after obtaining the qualification of high tech enterprise (from 2023 to 2025), the income tax
will be levied at 15%.
(6) The subsidiary Kechuangyuan Software is an enterprise located in Qianhai Shenzhen
Hong Kong Modern Service Industry Cooperation Zone. Its main business meets the
conditions of Preferential Catalogue of Enterprise Income Tax in Qianhai Shenzhen Hong
Kong Modern Service Industry Cooperation Zone (2021)(the Regulation shall be
implemented from January 1, 2021 to December 31, 2026), and the income tax is levied at
(7) Pursuant to the "Announcement of the Ministry of Finance and the State Taxation
Administration on Further Implementation of Income Tax Preferential Policies for Small and
Micro-sized Enterprises" (Announcement No. 13 of 2022), the "Announcement on Income
Tax Preferential Policies for Small and Micro-sized Enterprises and Self-employed
Businesses" (Announcement No. 6 of 2023), and the "Announcement of the Ministry of
Finance and the State Taxation Administration on Further Supporting the Development of
Small and Micro-sized Enterprises and Self-employed Businesses with Respect to Relevant
China Fangda Group Co., Ltd. Notes to Financial Statements
Tax Policies" (Announcement No. 12 of 2023), certain subsidiaries qualified as small and
micro-sized enterprises in 2025 and are subject to enterprise income tax in accordance with
the aforementioned announcements.
V. Notes to the consolidated financial statements
Item December 31, 2025 December 31, 2024
Inventory cash: 697.90 148.01
Bank deposits 1,122,843,849.53 1,052,461,034.10
Other monetary capital 278,447,555.29 439,316,159.73
Total 1,401,292,102.72 1,491,777,341.84
Including: total amount deposited
in overseas
Note: (1) Of the closing balance of bank deposits, RMB44,021,919.51 was restricted in
use, comprising judicially frozen funds of RMB10,494,858.12, interest on time deposits of
RMB58,081.29, regulated funds designated for specific purposes amounting to
RMB29,840,625.90, and other restricted funds totaling RMB3,628,354.20. Of the closing
balance of other monetary funds, RMB266,304,635.32 was restricted in use, primarily
consisting of bankers' acceptance deposit guarantees, interim guarantee deposits, letter of
guarantee issuance deposits, and funds in transit. In the preparation of the cash flow statement,
the above-mentioned deposits and other restricted deposits are not used as cash and cash
equivalents.
(2) In addition, there are no other funds in the monetary funds at the end of the period
that have restrictions on use and potential recovery risks due to mortgages, pledges or
freezing.
Item December 31, 2025 December 31, 2024
Financial assets measured at fair
value with variations accounted into 410.06
current income account
Of which: Wealth management
products
Total 410.06
Item December 31, 2025 December 31, 2024
China Fangda Group Co., Ltd. Notes to Financial Statements
Item December 31, 2025 December 31, 2024
Futures contracts 1,459,950.00
Total 1,459,950.00
(1) Classification of notes receivable
December 31, 2025 December 31, 2024
Type Remaining Bad debt Remaining Bad debt
Book value Book value
book value provision book value provision
Bank
acceptance
Commercial
acceptance
Total 135,779,716.10 14,001,653.10 121,778,063.00 74,530,950.99 643,256.75 73,887,694.24
(2) The Company has no endorsed or discounted unmature receivable notes at the end of
the period.
Item De-recognized amount Amount not derecognized
Bank acceptance 30,948,234.15
Commercial acceptance 9,833,296.73
Total 40,781,530.88
Note: The bank-accepted bills discounted or endorsed are accepted by banks with lower
credit ratings. Discounting or endorsement does not affect the right of recourse, and the
related credit risk and deferred payment risk of the bills have not been transferred; therefore,
derecognition has not been made.
(3) Disclosure by bad debt accrual method
December 31, 2025
Type Remaining book value Bad debt provision
Proportion Provision Book value
Amount Amount
(%) rate %
Provision for bad debts
by combination
Bank acceptance 57,188,013.94 42.12 57,188,013.94
Commercial acceptance 78,591,702.16 57.88 14,001,653.10 17.82 64,590,049.06
Total 135,779,716.10 100.00 14,001,653.10 10.31 121,778,063.00
(Continued)
December 31, 2024
Type
Remaining book value Bad debt provision Book value
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2024
Type Remaining book value Bad debt provision
Proportion Provision Book value
Amount Amount
(%) rate %
Provision for bad debts by
combination
Bank acceptance 39,584,331.31 53.11 39,584,331.31
Commercial acceptance 34,946,619.68 46.89 643,256.75 1.84 34,303,362.93
Total 74,530,950.99 100.00 643,256.75 0.86 73,887,694.24
(4) Changes in bad debt provision
Change in the period
December 31, Written- December 31,
Type back or Other
recovere change
d
Commercial
acceptance
(1) Account age
Age December 31, 2025 December 31, 2024
Less than 1 year 376,385,477.08 535,457,065.77
Over 7 years 118,155,447.36
Subtotal 1,487,966,419.53 1,497,815,001.12
Less : Bad debt provision 602,449,862.30 374,308,804.14
Total 885,516,557.23 1,123,506,196.98
(2) Disclosure by bad debt accrual method
December 31, 2025
Type Remaining book value Bad debt provision
Proportion Provision Book value
Amount Amount
(%) rate %
Separate bad debt
provision
Provision for bad debts 1,293,466,018.84 86.93 430,062,095.57 33.25 863,403,923.27
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2025
Type Remaining book value Bad debt provision
Proportion Provision Book value
Amount Amount
(%) rate %
by combination
wall business receivables
screen door business 177,576,351.40 11.93 38,295,527.37 21.57 139,280,824.03
receivables
materials business 108,037,986.27 7.26 4,269,005.77 3.95 103,768,980.50
receivables
energy business 26,263,129.43 1.77 1,313,156.47 5.00 24,949,972.96
receivables
Commercial real estate 52,497,858.35 3.53 3,902,959.38 7.43 48,594,898.97
and other receivables
Total 1,487,966,419.53 100.00 602,449,862.30 40.49 885,516,557.23
(Continued)
December 31, 2024
Type Remaining book value Bad debt provision
Proportion Provision Book value
Amount Amount
(%) rate %
Separate bad debt
provision
Provision for bad debts
by combination
Engineering operations 1,201,581,352.19 80.23 270,560,899.59 22.52 931,020,452.60
section
business payments
business models
Total 1,497,815,001.12 100.00 374,308,804.14 24.99 1,123,506,196.98
Method of bad debt provision：
① As of December 31, 2025, explanation for allowance for doubtful accounts provided on an
individual basis:
December 31, 2025
Name
Remaining book value Bad debt provision Providing rate (%)
Customer 1 54,873,223.21 54,873,223.21 100.00
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2025
Name
Remaining book value Bad debt provision Providing rate (%)
Customer 2 45,507,085.02 42,914,882.44 94.30
Customer 6 38,886,078.45 23,331,647.07 60.00
Customer 5 19,722,254.14 19,722,254.14 100.00
Customer 3 13,461,834.96 13,461,834.96 100.00
Customer 7 9,915,000.00 5,949,000.00 60.00
Customer 4 7,096,421.00 7,096,421.00 100.00
Other customers 5,038,503.91 5,038,503.91 100.00
Total 194,500,400.69 172,387,766.73 88.63
As of December 31, 2024, explanation for allowance for doubtful accounts provided on
an individual basis:
Name
December 31, 2024
Name
Remaining book value Bad debt provision Provision rate %
Customer 1 54,873,223.21 54,873,223.21 100.00
Customer 2 47,210,577.56 23,605,288.79 50.00
Customer 3 13,461,834.96 13,461,834.96 100.00
Customer 4 7,096,421.00 3,548,210.50 50.00
Customer 5 4,998,860.10 2,499,430.06 50.00
Total 127,640,916.83 97,987,987.52 76.77
Note: Due to certain customers experiencing prolonged non-payment, material debt defaults,
bankruptcy reorganization, or similar circumstances, the Company has determined that full recovery of
receivables from these customers is uncertain. In accordance with the prudence principle, the Company has
individually provided for impairment losses on these accounts receivable.
② As of December 31, 2025, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 1 – Curtain Wall Business Receivables
December 31, 2025
Age Providing rate
Remaining book value Bad debt provision
(%)
Less than 1 year 193,396,954.28 9,669,847.69 5.00
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2025
Age Providing rate
Remaining book value Bad debt provision
(%)
Over 7 years 104,691,958.85 104,691,958.85 100.00
Total 929,090,693.39 382,281,446.58 41.15
As of December 31, 2025, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 2 – Platform Screen Door Business Receivables
December 31, 2025
Age
Remaining book value Bad debt provision Providing rate (%)
Less than 1 year 67,079,150.77 670,791.51 1.00
Over 5 years 14,255,353.61 14,255,353.61 100.00
Total 177,576,351.40 38,295,527.37 21.57
As of December 31, 2024, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 1 – Engineering Business Receivables
December 31, 2024
Age Providing rate
Remaining book value Bad debt provision
(%)
Less than 1 year 434,542,505.23 8,518,488.97 1.96
Over 5 years 140,443,707.44 140,443,707.44 100.00
Total 1,201,581,352.19 270,560,899.59 22.52
③ As of December 31, 2025, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 3 – New Materials Business Receivables
Age December 31, 2025
China Fangda Group Co., Ltd. Notes to Financial Statements
Remaining book value Bad debt provision Providing rate (%)
Less than 1 year 68,862,940.96 688,629.38 1.00
Over 5 years 860,051.23 860,051.23 100.00
Total 108,037,986.27 4,269,005.77 3.95
As of December 31, 2025, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 4 – New Energy Business Receivables
December 31, 2025
Age
Remaining book value Bad debt provision Providing rate (%)
Less than 1 year 12,303,649.40 615,182.47 5.00
Total 26,263,129.43 1,313,156.47 5.00
As of December 31, 2024, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 3 – Other Business Receivables
December 31, 2024
Age Providing rate
Remaining book value Bad debt provision
(%)
Less than 1 year 44,731,417.29 326,523.94 0.73
Over 5 years 623,725.47 623,725.47 100.00
Total 81,425,919.91 3,578,698.60 4.40
④ As of December 31, 2025, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 5 – Commercial Real Estate and Other Receivables
December 31, 2025
Age
Remaining book value Bad debt provision Providing rate (%)
Less than 1 year 33,050,286.15 330,502.85 1.00
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2025
Age
Remaining book value Bad debt provision Providing rate (%)
Over 5 years 359,129.89 359,129.89 100.00
Total 52,497,858.35 3,902,959.38 7.43
As of December 31, 2024, accounts receivable for which allowance for doubtful
accounts is provided based on Portfolio 2 – Real Estate Business Receivables
December 31, 2024
Age Providing rate
Remaining book value Bad debt provision
(%)
Less than 1 year 54,413,740.54 543,431.46 1.00
Total 87,166,812.19 2,181,218.43 2.50
Provision for bad debts by combination: 11.
(3) Changes in bad debt provision
Change in the period
December 31, December 31,
Type Written-back Other
or recovered change
Separate
bad debt 97,987,987.52 74,399,779.21 172,387,766.73
provision
Provision
for bad
debts by
combination
Total 374,308,804.14 235,005,089.70 6,869,566.78 -5,535.24 602,449,862.30
(4) Written-off account receivable during the period
Item Amount
Account receivable written off 6,869,566.78
(5) Accounts receivable and contract assets with the five largest outstanding balances by
debtor as of the reporting date
The aggregate amount of the five largest accounts receivable (including contract assets)
by debtor as of the reporting date in the current period is RMB460,203,390.85, representing
China Fangda Group Co., Ltd. Notes to Financial Statements
The corresponding aggregate allowance for doubtful accounts as of the reporting date
amounts to RMB118,166,624.28.
(1) Classification of notes receivable
Fair Value on Wednesday, Fair Value on Tuesday,
Item
December 31, 2025 December 31, 2024
Notes receivable 4,568,000.10
(2) Trade receivables financing that have been endorsed or discounted but not yet
matured as of the reporting date
Item De-recognized amount Amount not derecognized
Bank acceptance 33,761,787.71
(1) Account age of prepayments
December 31, 2025 December 31, 2024
Age
Amount Proportion (%) Amount Proportion (%)
Less than 1 year 15,477,666.96 75.85 17,938,392.45 76.81
Over 3 years 3,056,026.16 14.97 2,062,396.77 8.83
Total 20,407,968.16 100.00 23,355,036.11 100.00
Note: At the end of the period, there is no significant prepayment with an aging of more
than one year.
(2) Balance of top 5 prepayments at the end of the period
The total of top5 prepayments in terms of the prepaid entities in the period is
RMB5,261,681.15, accounting for 25.78% of the total prepayments at the end of the period.
(1) Classification of notes receivable
Item December 31, 2025 December 31, 2024
Other receivables 120,173,307.70 168,322,524.80
Total 120,173,307.70 168,322,524.80
China Fangda Group Co., Ltd. Notes to Financial Statements
(2) Other receivables
(1) Disclosure by age
Age December 31, 2025 December 31, 2024
Less than 1 year 17,089,433.93 45,432,663.12
Over 5 years 91,455,364.51 102,013,397.33
Subtotal 132,380,433.44 176,358,353.41
Less : Bad debt provision 12,207,125.74 8,035,828.61
Total 120,173,307.70 168,322,524.80
(2) Classification by nature of funds
By nature December 31, 2025 December 31, 2024
Deposit and pledge paid 78,067,608.63 101,364,611.15
Construction borrowing and
advanced payment
Staff borrowing and petty cash 2,942,771.01 3,221,577.94
VAT refund receivable 527,217.36 642,493.02
Refundable advance payments 2,713,230.50 18,884,265.12
Others 10,806,871.89 12,294,754.02
Subtotal 132,380,433.44 176,358,353.41
Less : Bad debt provision 12,207,125.74 8,035,828.61
Total 120,173,307.70 168,322,524.80
③ Method of bad debt Disclosed
A. The provision for bad debts as at Wednesday, December 31, 2025 is based on the
three-phase model as follows:
Remaining book
Step segment Bad debt provision Book value
value
First stage 114,617,240.74 1,928,103.44 112,689,137.30
Second stage 9,603,537.62 3,379,335.58 6,224,202.04
Third stage 8,159,655.08 6,899,686.72 1,259,968.36
Total 132,380,433.44 12,207,125.74 120,173,307.70
As at Wednesday, December 31, 2025, the first phase of the provision for bad debts:
China Fangda Group Co., Ltd. Notes to Financial Statements
Remaining book Providing rate Bad debt
Type Book value
value (%) provision
Separate bad debt provision
Provision for bad debts by 114,617,240.74 1.68 1,928,103.44 112,689,137.30
combination
Portfolio 3: deposit and margin 74,212,037.53 1.47 1,089,166.39 73,122,871.14
receivable
Combination 4: Advances 33,834,318.73 1.75 593,422.94 33,240,895.79
receivable
Portfolio 5: VAT refund 527,217.36 1.00 5,272.17 521,945.19
receivable
Portfolio 7: Other receivables 6,043,667.12 3.98 240,241.94 5,803,425.18
Total 114,617,240.74 1.68 1,928,103.44 112,689,137.30
As at Wednesday, December 31, 2025, the second phase of the provision for bad debts:
Remaining book Providing rate Bad debt
Type Book value
value (%) provision
Separate bad debt provision
Provision for bad debts by 9,603,537.62 35.19 3,379,335.58 6,224,202.04
combination
Portfolio 3: deposit and margin 2,129,187.67 41.30 879,423.91 1,249,763.76
receivable
Combination 4: Advances 3,463,081.82 41.43 1,434,706.36 2,028,375.46
receivable
Portfolio 7: Other receivables 4,011,268.13 26.56 1,065,205.31 2,946,062.82
Total 9,603,537.62 35.19 3,379,335.58 6,224,202.04
As at Wednesday, December 31, 2025, the third phase of the provision for bad debts:
Remaining book Providing rate Bad debt
Type Book value
value (%) provision
Separate bad debt provision
Provision for bad debts by 8,159,655.08 84.56 6,899,686.72 1,259,968.36
combination
Portfolio 3: Receivables from 1,726,383.43 100.00 1,726,383.43
deposits and guarantees
Combination 4: Advances 25,333.50 100.00 25,333.50
receivable
Portfolio 7: Other receivables 6,407,938.15 80.34 5,147,969.79 1,259,968.36
Total 8,159,655.08 84.56 6,899,686.72 1,259,968.36
B. The provision for bad debts as at December 31, 2024 is based on the three-phase
model as follows:
Remaining book
Step segment Bad debt provision Book value
value
China Fangda Group Co., Ltd. Notes to Financial Statements
Remaining book
Step segment Bad debt provision Book value
value
First stage 167,771,508.00 2,498,265.50 165,273,242.50
Second stage 3,143,590.00 94,307.70 3,049,282.30
Third stage 5,443,255.41 5,443,255.41 -
Total 176,358,353.41 8,035,828.61 168,322,524.80
As at Tuesday, December 31, 2024, the first phase of the provision for bad debts:
Remaining book Providing rate Bad debt
Type Book value
value (%) provision
Separate bad debt provision
Provision for bad debts by
combination
Portfolio 3: deposit and margin
receivable
Combination 4: Advances
receivable
Portfolio 5: VAT refund
receivable
Portfolio 7: Other receivables 8,855,697.60 1.49 131,963.02 8,723,734.58
Total 167,771,508.00 1.49 2,498,265.50 165,273,242.50
As at Tuesday, December 31, 2024, the second phase of the provision for bad debts:
Remaining book Providing rate Bad debt
Type Book value
value (%) provision
Separate bad debt provision
Provision for bad debts by
combination
Portfolio 3: deposit and margin
receivable
Combination 4: Advances
receivable
Portfolio 7: Other receivables 438,500.00 3.00 13,155.00 425,345.00
Total 3,143,590.00 3.00 94,307.70 3,049,282.30
As at Tuesday, December 31, 2024, the third phase of the provision for bad debts:
Remaining book Providing rate Bad debt
Type Book value
value (%) provision
Separate bad debt provision
Provision for bad debts by
combination
Portfolio 3: Receivables from
deposits and guarantees
Combination 4: Advances
receivable
Portfolio 7: Other receivables 3,000,556.42 100.00 3,000,556.42
Total 5,443,255.41 100.00 5,443,255.41
China Fangda Group Co., Ltd. Notes to Financial Statements
The amount of the bad debt provision is Basis：
Provision for bad debts by combination: 11.
④ Changes in bad debt provision
Change in the period
December 31, Written-ba December 31,
Type Other
change
recovered
Separate bad
debt
provision
Provision for
bad debts by 8,035,828.61 4,181,353.42 9,825.48 230.81 12,207,125.74
combination
Total 8,035,828.61 4,181,353.42 9,825.48 230.81 12,207,125.74
⑤ Other receivables actually written off in the current period
Item Amount
Other receivable written off 9,825.48
⑥ Balance of top 5 other receivables at the end of the period
Balance on
By nature Wednesday, Bad debt
Entity Age Percentage (%)
December 31, provision
Margin and 6,000,000.00 2-3 years 60,000.00
Shenzhen Yikang
current 57.46
Real Estate Co. Ltd. 70,062,675.83 Over 5 years 700,626.76
account
Shenzhen Dakang
Joint-Stock 8,000,000.00 Over 5 years 80,000.00
Deposit 6.04
Cooperative
Company
Shenzhen Ganshang
Investment 3,791,089.25 Over 5 years 2,531,120.89
Joint Investment 2.86
payment
Co., Ltd.
Bangshen
Electronics 3,000,000.00 Over 5 years 30,000.00
Deposit 2.27
(Shenzhen) Co.,
Ltd.
Shenzhen 939,115.00 1-2 years 0.71 187,823.00
Tongmeng
Reimbursab
Decoration
le expenses 1,534,115.50 2-3 years 1.16 383,528.88
Technology Co.,
Ltd.
Total 93,326,995.58 70.50 3,973,099.53
China Fangda Group Co., Ltd. Notes to Financial Statements
(1) Classification of inventories
December 31, 2025 December 31, 2024
Provision
Provision for for
inventory inventory
depreciation depreciatio
Item Remaining or contract Remaining n or
Book value Book value
book value performance book value contract
cost performanc
impairment e cost
provision impairment
provision
Raw 111,622,459.0 111,622,459.0 111,139,470.3 111,139,470.3
materials 0 0 7 7
Product in 100,255,413.9 100,255,413.9
process 0 0
Finished
goods in 41,225,785.96 41,225,785.96 8,694,704.45 8,694,704.45
stock
Developmen 202,021,658.9 202,021,658.9 230,990,938.0 230,990,938.0
t cost 4 4 9 9
Developmen 116,643,162.6 23,306,214.7 124,380,755.9 124,380,755.9
t products 8 4 1 1
OEM
materials
Contract
performance 81,997,883.89 81,997,883.89
costs
Goods
delivered
Materials in
transit
Total
(2) Provision for inventory depreciation or contract performance cost impairment
provision
Increase in this period Decrease in this period
December December 31,
Item Recover or
write-off
Development
products
(3) Description of ending inventory balance including capitalization amount of
borrowing costs:
As of December 31, 2025, the capitalized borrowing costs included in inventory balances
amounted to RMB4,470,824.99. The calculation basis and criteria for borrowing costs are
disclosed in Note III.20.
China Fangda Group Co., Ltd. Notes to Financial Statements
(4) Development cost
Estimated
Closing
Starting Estimated total December 31, December 31,
Item depreciation
time finish time investment 2025 2024
provision
Investment
Dakang
December RMB3.6 202,021,658.94
Village December
Project in 1, 2028 31, 2034 billion
Shenzhen
Fangda
Bangshen
Industry
Park
RMB3.6 202,021,658.94
Total 230,990,938.09
billion
Note: On November 6, 2017, Fangda Property Co., Ltd., a subsidiary of the Company,
entered into the "Co-Development Agreement for the Fangda Bangshen Industrial Park
(provisional name) Urban Renewal Project" with Bangshen Electronics (Shenzhen) Co., Ltd.,
agreeing to jointly advance this "industrial-to-industrial" urban renewal project under a
co-development model. During project implementation, objective factors—including policy
adjustments related to the "Lixin Lake Area Integrated Planning" in Bao'an District, Shenzhen,
and changes in the market environment—continuously impeded progress, making it
impossible to proceed as originally planned. After amicable negotiations, both parties
formally signed a termination agreement on November 10, 2025, mutually agreeing to
terminate the aforementioned co-development agreement. Effective from the date of
effectiveness of the termination agreement, Fangda Property Co., Ltd. will no longer
participate in the subsequent development or related operations of the Fangda Bangshen
Industrial Park project.
(5) Development products
Current Closing
Item Completion December 31, December 31,
period Decrease depreciation
Name time 2024 2025
Increase provision
Phase I of 29
Fangda December 15,532,505.97
Town 2016
Nanchang
April 27,
Fangda 108,848,249.94 7,737,593.23 101,110,656.71 23,306,214.74
Center
Total 124,380,755.91 7,737,593.23 116,643,162.68 23,306,214.74
China Fangda Group Co., Ltd. Notes to Financial Statements
(1) Contract assets
December 31, 2025 December 31, 2024
Item Remaining book Impairment Remaining Impairment
Book value Book value
value provision book value provision
Completed and
unsettled project
funds that fail to
meet the
collection
conditions
Quality guarantee
deposit that fails
to meet the 332,521,906.40 27,924,265.40 304,597,641.00 262,289,726.50 24,254,807.14 238,034,919.36
collection
conditions
Sales funds with
conditional 52,852,539.43 727,775.89 52,124,763.54
collection right
Subtotal 2,339,553,421.19 225,686,758.02 2,113,866,663.17 2,618,671,981.34 221,818,937.64 2,396,853,043.70
Less: Contract
assets shown in
other non-current
assets
Total 2,214,339,118.85 216,247,967.42 1,998,091,151.43 2,458,259,929.89 210,561,449.93 2,247,698,479.96
(2) Disclosure by impairment method
December 31, 2025
Type Remaining book value Impairment provision
Proportion Provision Book value
Amount Amount
(%) rate %
Provision for impairment 8,992,352.88 0.41 8,992,352.88 100.00
by single item
Provision for impairment 2,205,346,765.97 99.59 207,255,614.54 9.40 1,998,091,151.43
by portfolio
Portfolio 2: Completed and
unsettled project not 1,998,039,161.91 90.23 188,770,139.73 9.45 1,809,269,022.18
meeting collection
conditions
Portfolio 3: Quality
guarantee deposit not 207,307,604.06 9.36 18,485,474.81 8.92 188,822,129.25
meeting collection
conditions
Total 2,214,339,118.85 100.00 216,247,967.42 9.77 1,998,091,151.43
(Continued)
December 31, 2024
Type
Remaining book value Impairment provision Book value
China Fangda Group Co., Ltd. Notes to Financial Statements
Proportion Provision
Amount Amount
(%) rate %
Provision for impairment
by single item
Provision for impairment
by portfolio
Combination 1: sales
payment with conditional 52,852,539.43 2.15 727,775.89 1.38 52,124,763.54
collection right
Portfolio 2: Completed
and unsettled project not
meeting collection
conditions
Portfolio 3: Quality
guarantee deposit not
meeting collection
conditions
Total 2,458,259,929.89 100.00 210,561,449.93 8.57 2,247,698,479.96
Note: Due to certain customers' prolonged non-payment, material debt defaults, and
bankruptcy reorganization proceedings, the Company has determined that there is uncertainty
regarding the full recovery of receivables from these customers. In accordance with the
prudence principle, the Company has individually recognized impairment allowances on
contract assets related to these customers.
(3) Change in provision for impairment
Change in the period
December 31, Transferred December 31,
Item Written off in
Provision the current
current change
period
period
Separate bad
debt 9,033,247.20 7,214,435.01 7,255,329.33 8,992,352.88
provision
Provision for
bad debts by 201,528,202.73 6,530,406.95 802,995.14 207,255,614.54
combination
Total 210,561,449.93 13,744,841.96 802,995.14 7,255,329.33 216,247,967.42
Note: The "Other changes" in the current period primarily result from the reclassification
of contract assets previously subject to individual impairment assessments into accounts
receivable for accounting purposes.
Item December 31, 2025 December 31, 2024
Reclassification of VAT debit balance 280,607,689.94 292,626,079.84
Overpayment and prepayment of 13,030,950.36 11,197,246.58
China Fangda Group Co., Ltd. Notes to Financial Statements
Item December 31, 2025 December 31, 2024
income tax
Other prepaid taxes 4,482.73 949,974.83
Payment to be collected on behalf of
suppliers
Total 296,646,964.92 307,777,143.14
(1) Long-term share equity investment
Change (+,-)
Book value Investment
Other
Invested entity on December Increased Decreased gain and loss Other
miscellaneous
investment investment income
using the change
adjustment
equity method
Shenzhen
Ganshang Joint
Investment Co.,
Ltd.
Jiangxi Business
Innovative
Property Joint
Stock Co., Ltd.
Total 56,690,973.97 -23,702,329.34
(Continued)
Change (+,-) Balance of
Book value on provision for
Invested entity Cash dividend December 31, impairment
Impairment
or profit Others 2025 on December
provision
announced 31, 2025
Shenzhen
Ganshang Joint
Investment Co.,
Ltd.
Jiangxi Business
Innovative
Property Joint
Stock Co., Ltd.
Total 32,988,644.63
Item December 31, 2025 December 31, 2024
China Fangda Group Co., Ltd. Notes to Financial Statements
Item December 31, 2025 December 31, 2024
Financial assets measured at fair
value with variations accounted 6,516,131.63 6,519,740.17
into current income account
Total 6,516,131.63 6,519,740.17
(1) Investment real estate measured at fair value
Item Houses & buildings Total
(1) Purchased 24,075,324.78 24,075,324.78
(1) Disposal 30,008,027.81 30,008,027.81
(3) Change in fair value Change in fair value 280,731,968.67 280,731,968.67
Notes:
① The primary basis for determining the fair value of investment properties is the "Real
Estate Appraisal Reports" issued by Shenzhen Guoyu Appraisal Co., Ltd., Real Estate and
Land Valuation Consultants, with report numbers "Shen Guoyu Ping Zi (2026) No. 01017-1",
"Shen Guoyu Ping Zi (2026) No. 01017-2", "Shen Guoyu Ping Zi (2026) No. 01015", "Shen
Guoyu Ping Zi (2026) No. 01016", "Shen Guoyu Ping Zi (2026) No. 01017-3", "Shen Guoyu
Ping Zi (2026) No. 01014", "Shen Guoyu Ping Zi (2026) No. 01017-4", "Shen Guoyu Ping Zi
(2026) No. 01017-5", and "Shen Guoyu Ping Zi (2026) No. 01017-6".
② As of December 31, 2025, certain real estate properties within Fangda Town have
been pledged to China Post Savings Bank Co., Ltd. as collateral for loans. These loans have
not yet matured and the pledge has not been released. The fair value of these pledged
properties amounts to RMB33,494,907,000.
(2) Investment real estate without ownership certificate
Item Book value Reason
Dawn relevant procedures
(1) Classification of notes receivable
China Fangda Group Co., Ltd. Notes to Financial Statements
Item December 31, 2025 December 31, 2024
Fixed assets 940,980,113.90 939,548,074.59
Disposal of fixed assets 1,346,269.80
Total 940,980,113.90 940,894,344.39
(2) Fixed assets
(1) Fixed assets
Electronics
Houses & Mechanical Transportation PV power
Item and other Total
buildings equipment facilities plants
devices
I. Original book
value:
this period
(1) Purchase 441,598.49 11,434,828.35 348,518.21 5,801,200.18 997,411.91 19,023,557.14
(2) Transfer-in of
construction in 23,503,790.32 23,503,790.32
progress
(3) Other
increases
this period
(1) Disposal or
retirement
(2) Other
decrease
II. Accumulative
depreciation
this period
(1) Provision 19,456,697.12 7,814,507.94 864,757.85 2,858,836.91 6,181,413.13 37,176,212.95
(2) Other
increases
this period
(1) Disposal or
retirement
(2) Other
decrease
III. Impairment
provision
China Fangda Group Co., Ltd. Notes to Financial Statements
Electronics
Houses & Mechanical Transportation PV power
Item and other Total
buildings equipment facilities plants
devices
this period
(1) Provision 2,650,000.00 2,650,000.00
this period
(1) Disposal or
retirement
IV. Book value
of fixed assets
at December 31, 772,958,143.58 70,348,975.85 5,114,086.62 21,620,627.04 70,938,280.81 940,980,113.90
at December 31, 768,507,644.05 69,594,022.84 5,727,533.77 18,918,748.96 76,800,124.97 939,548,074.59
Note: The "Other increases and decreases" are primarily due to exchange rate
fluctuations.
② Fixed assets without ownership certificate
Book value on December 31,
Item Reason
Yuehai Office Building C 502 94,206.21 Historical reasons
(1) Classification of notes receivable
Item December 31, 2025 December 31, 2024
Construction in process 1,214,530.34 7,265,104.44
Total 1,214,530.34 7,265,104.44
(1) Construction in progress
December 31, 2025 December 31, 2024
Item Remaining Impairment Remaining Impairment
Book value Book value
book value provision book value provision
Fangda (Ganzhou)
Low-Carbon
Intelligent
Manufacturing
Base – Phase I
Exhibition Hall
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2025 December 31, 2024
Item Remaining Impairment Remaining Impairment
Book value Book value
book value provision book value provision
and Installed
Equipment
Songshan lake
production base
exhibition hall
renovation
Software and other
information
technology
projects
Total 1,214,530.34 1,214,530.34 7,265,104.44 7,265,104.44
Explanation: As of December 31, 2025, the Company's construction in progress showed
no indication of impairment.
(1) Right-to-use assets
Transportation
Item Houses & buildings Total
facilities
I. Original book value:
II. Accumulative depreciation
(1) Provision 3,153,312.19 1,236,213.69 4,389,525.88
(1) Disposal 1,743,811.77 1,116,908.93 2,860,720.70
III. Impairment provision
IV. Book value
China Fangda Group Co., Ltd. Notes to Financial Statements
Transportation
Item Houses & buildings Total
facilities
(2) Impairment testing of right-of-use assets
As of December 31, 2025, there was no indication of impairment of the Company's
right-of-use assets.
(1) Intangible assets
Land using
Item Patent Software Others Total
right
I. Book value
(1) Purchase 426,186.52 4,242,674.77 4,668,861.29
period
(1) Disposal 48,330,450.00 2,012,338.04 243,323.66 50,586,111.70
II. Accumulative
amortization
(1) Provision 2,546,293.68 417,108.04 2,011,794.37 180,000.00 5,155,196.09
period
(1) Disposal 3,179,444.15 2,012,113.04 243,323.66 5,434,880.85
III. Impairment
provision
period
(1) Disposal 3,844,005.85 3,844,005.85
IV. Book value
December 31, 2025
December 31, 2024
China Fangda Group Co., Ltd. Notes to Financial Statements
(2) Failure to obtain the land use right certificates
At the end of the period, the Company had no land use right without the property right
certificate.
December 31, Decrease December 31,
Item Increase
Expenditures
on
modifications
to property,
plant and
equipment, etc.
(1) Non-deducted deferred income tax assets
December 31, 2025 December 31, 2024
Item Deductible Deferred
Deductible temporary Deferred income
temporary income tax
difference tax assets
difference assets
Assets impairment
provision
Credit impairment
provision
Unrealizable gross profit 122,552,188.00 28,685,612.51 108,593,435.66 26,573,799.68
Deductible loss 486,268,366.84 91,973,864.74 286,565,331.75 67,193,424.59
Anticipated liabilities 7,214,622.24 1,082,193.35 4,191,535.03 628,730.25
Unrealized investment
income
Deferred earning 21,913,458.18 3,518,841.84 5,946,064.06 1,041,584.25
Change in fair value 10,239,089.49 1,535,863.42 8,623,065.19 1,303,042.83
Lease liabilities 13,623,096.04 2,469,342.96 15,352,065.96 2,788,081.55
Accrued and unpaid land
tax
Reserved expense 36,589,539.42 5,488,430.92 36,589,539.42 5,488,430.92
Tax and accounting
differences for overseas 7,121,041.73 2,136,312.52 8,617,276.57 2,585,182.97
subsidiaries
Total 1,880,028,115.50 337,441,161.32 1,383,015,870.72 262,957,129.14
(2) Non-deducted deferred income tax liabilities
December 31, 2025 December 31, 2024
Item Taxable temporary Deferred income Taxable temporary Deferred income
difference tax liabilities difference tax liabilities
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2025 December 31, 2024
Item Taxable temporary Deferred income Taxable temporary Deferred income
difference tax liabilities difference tax liabilities
Change in fair value 4,014,727,945.14 1,000,546,168.91 4,296,974,960.10 1,071,313,064.75
Acquire premium to
form inventory
Use right assets 13,470,006.41 2,564,776.55 15,683,121.04 2,901,986.66
Estimated gross
margin when
Fangda Town
records income, but
does not reach the
taxable income level
Rental income 24,631,068.63 6,157,767.16 26,717,859.03 6,679,464.47
Total 4,062,365,438.40 1,011,652,817.18 4,365,043,254.06 1,087,311,344.35
(3) Net deferred income tax assets or liabilities listed
Offset balance of
Offset balance of Deferred income deferred income
Deferred income tax
deferred income tax tax assets and tax assets or
assets and liabilities
Item assets or liabilities liabilities on liabilities after
on December 31,
after offsetting on December 31, offsetting on
December 31, 2025 2024 December 31,
Deferred income
tax assets
Deferred income
tax liabilities
(4) Details of unrecognized deferred income tax assets
Item December 31, 2025 December 31, 2024
Deductible temporary difference 2,555,701.75 434,437.85
Deductible loss 20,249,356.74 383,366.61
Total 22,805,058.49 817,804.46
(5) Deductible losses of the un-recognized deferred income tax asset will expire in the
following years
Year December 31, 2025 December 31, 2024
China Fangda Group Co., Ltd. Notes to Financial Statements
Year December 31, 2025 December 31, 2024
Total 20,249,356.74 383,366.61
December 31, 2025 December 31, 2024
Item Remaining Impairment Remaining Impairment
Book value Book value
book value provision book value provision
Prepaid house
and equipment 29,968,445.50 29,968,445.50 63,504,106.15 63,504,106.15
amount
Contract assets 125,214,302.34 9,438,790.60 115,775,511.74 160,412,051.45 11,257,487.71 149,154,563.74
Subtotal 155,182,747.84 9,438,790.60 145,743,957.24 223,916,157.60 11,257,487.71 212,658,669.89
Less: others
non-current
assets due in 1
year
Total 155,182,747.84 9,438,790.60 145,743,957.24 223,916,157.60 11,257,487.71 212,658,669.89
December 31, 2025
Item
Book value Restricted situation
Monetary capital 299,831,696.71 Various deposits
Monetary capital 10,494,858.12 Judicial freeze
Notes receivable 39,012,200.04 Bills endorsed or discounted but not yet due
Account receivable 17,261,724.13 Loan by pledge
Fixed assets 192,954,910.15 Loan by pledge
Intangible assets 22,728,870.63 Loan by pledge
Investment real estate 3,349,490,698.00 Loan by pledge
Long-term Equity
Investments (Parent ——
held by the Company
Company)
Total 3,931,774,957.78 -
(Continued)
December 31, 2024
Item
Book value Restricted situation
Monetary capital 460,052,125.50 Various deposits
Notes receivable 34,490,806.03 Bills endorsed or discounted but not yet due
Account receivable 33,851,277.04 Loan by pledge
Fixed assets 355,978,425.04 Loan by pledge
Intangible assets 23,212,463.67 Loan by pledge
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2024
Item
Book value Restricted situation
Investment real estate 1,822,483,172.10 Loan by pledge
Long-term Equity
Investments (Parent ——
held by the Company
Company)
Total 2,730,068,269.38 -
(1) Classification of short-term borrowings
Item December 31, 2025 December 31, 2024
Guarantee loan 674,220,527.58 720,642,744.49
Guarantee and pledge loan 528,625,969.45 943,053,677.99
Total 1,202,846,497.03 1,663,696,422.48
Notes:
① As of the reporting date, among guaranteed borrowings:
RMB62,045,333.34 and RMB605,125,916.77 were guaranteed by the Company for its subsidiaries Fangda
Zhiyuan Technology Co., Ltd. and Shenzhen Fangda Construction Technology Group Co., Ltd.,
respectively;
RMB6,019,002.78 was guaranteed by the Company for its subsidiary Shenzhen Fangda Yunchu
Technology Co., Ltd.;
RMB1,030,274.69 was guaranteed by the Company for its subsidiary Fangda New Materials (Jiangxi) Co.,
Ltd.RMB1,030,274.69 was guaranteed by the Company for its subsidiary Fangda New Materials (Jiangxi)
Co., Ltd. Among guaranteed borrowings, internal factoring loans amounted to
RMB194,900,000.
② At the end of the period, among the guaranteed and pledged borrowings:
RMB49,047,775.00 was guaranteed by the Company for its subsidiary Shenzhen Fangda Construction
Technology Group Co., Ltd., with the subsidiary further providing a pledge of intellectual property rights
over its patents for an "Automatic Sensing Curtain Wall Energy-Saving Window System" and an
"Intelligent Shading System";
RMB40,027,777.78 was guaranteed by the Company for its subsidiary Shenzhen Fangda Construction
China Fangda Group Co., Ltd. Notes to Financial Statements
Technology Group Co., Ltd., with the subsidiary additionally pledging its patent for a "Modular Frame
Curtain Wall System" as intellectual property collateral;
RMB50,038,194.45 was guaranteed by the Company for Shenzhen Fangda Construction Technology Group
Co., Ltd., with the subsidiary pledging its patents for a "Connecting Structure for a
Through-Ventilation-Type Box Curtain Wall" and a "Copper-Aluminum Composite Panel Energy-Saving
Curtain Wall Structure" as intellectual property collateral;
RMB342,580,000.00 was guaranteed and pledged by the Company for its subsidiary Shenzhen Fangda
Construction Technology Group Co., Ltd. Among guaranteed and pledged borrowings, internal
factoring loans amounted to RMB40,580,000.00.
Item December 31, 2025 December 31, 2024
Futures contracts 1,520,625.00
Total 1,520,625.00
Type December 31, 2025 December 31, 2024
Bank acceptance 428,511,829.11 672,229,721.56
Commercial acceptance 598,808.42 8,958,406.41
Total 429,110,637.53 681,188,127.97
(1) By nature
Item December 31, 2025 December 31, 2024
Account repayable and engineering repayable 1,456,091,905.06 1,528,510,873.88
Payable installation and implementation fees 540,158,310.89 558,215,149.23
Construction payable 17,642,579.41 27,062,009.47
Others 26,798,424.80 32,806,857.99
Total 2,040,691,220.16 2,146,594,890.57
(2) There were no material accounts payable aged over one year as of the period end.
Item December 31, 2025 December 31, 2024
Rent received in advance 3,517,539.83 1,513,398.39
Total 3,517,539.83 1,513,398.39
China Fangda Group Co., Ltd. Notes to Financial Statements
(1) Contract liabilities status
Item December 31, 2025 December 31, 2024
Project funds collected in
advance
Material loan 979,539.70 8,934,838.06
Others 1,366,667.08 344,191.43
Total 350,155,877.61 268,594,041.26
(1) Employees' wage payable
December 31, December 31,
Item Increase Decrease
program-defined contribution 762,569.73 31,667,690.80 31,717,595.58 712,664.95
plan
Total 76,243,647.97 475,023,674.96 483,454,476.84 67,812,846.09
(2) Short-term remuneration
December 31, December 31,
Item Increase Decrease
subsidies
Including: medical insurance 170,309.99 8,429,936.21 8,478,678.37 121,567.83
Labor injury insurance 10,483.12 1,101,060.84 1,103,883.37 7,660.59
Breeding insurance 6,436.39 723,183.53 723,747.42 5,872.50
V. Labor union and staff
education budget
VI. Short-term paid leave 538,234.28 134,295.41 - 672,529.69
Total 69,946,623.12 430,502,785.23 438,781,419.33 61,667,989.02
(3) Defined contribution plan
December 31, December 31,
Item Increase Decrease
After-retirement welfare:
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, December 31,
Item Increase Decrease
Total 762,569.73 31,667,690.80 31,717,595.58 712,664.95
Item December 31, 2025 December 31, 2024
Enterprise income tax 12,238,129.74 22,749,953.33
VAT 6,404,428.28 5,014,443.15
Personal income tax 1,465,819.45 1,436,564.89
City maintenance and
construction tax
Land using tax 427,736.41 342,015.86
Property tax 1,608,807.88 1,433,309.14
Education surtax 306,278.00 194,329.75
Local education surtax 204,185.33 129,553.00
Consumption service tax 1,469,363.12 237,874.41
Land VAT 15,043,321.06 16,012,293.28
Others 569,589.35 853,886.08
Total 40,439,297.75 48,847,117.19
(1) Classification of notes receivable
Item December 31, 2025 December 31, 2024
Other payables 125,372,728.24 120,918,002.02
Total 125,372,728.24 120,918,002.02
(2) Other payables
① Other payables presented by nature
Item December 31, 2025 December 31, 2024
Performance and quality deposit 39,447,699.46 42,955,873.85
Deposit 23,547,532.18 22,843,813.76
Reserved expense 3,689,432.93 5,336,051.21
Others 58,688,063.67 49,782,263.20
Total 125,372,728.24 120,918,002.02
② Other important accounts payable with an aging of more than one year at the end of
the period
China Fangda Group Co., Ltd. Notes to Financial Statements
Balance on Wednesday,
Item Reason
December 31, 2025
Shenzhen Yikang Real Estate Co. Payment paid as agreed in the
Ltd. contract
Item December 31, 2025 December 31, 2024
Long-term loans due within 1
year
Lease liabilities due within one
year
Provisions expected to mature
within one year
Total 379,089,194.66 131,374,661.05
Item December 31, 2025 December 31, 2024
Notes receivable endorsed but
not derecognized
Substituted money on VAT 20,137,407.63 29,409,280.92
Total 60,918,938.51 50,835,559.67
(1) Classification of long-term borrowings
Item December 31, 2025 December 31, 2024
range
Guarantee, mortgage and pledge
loan
Subtotal 1,658,687,783.34 1,260,355,127.55
Less: Long-term loans due within
Total 1,290,000,000.00 1,137,000,000.00
Note:Among the aforementioned guaranteed, mortgaged, and pledged borrowings:
Borrowings of RMB1,081,171,500.00 were secured by pledges of 100% equity interests in the Company's
subsidiary Fangda Property Holdings Company (held directly and indirectly by China Fangda Group Co.,
Ltd.) and receivable rental income from the Company's self-held Fangda City leased properties;
Borrowings of RMB280,247,333.34 were guaranteed by China Fangda Group Co., Ltd. for its subsidiary
Fangda Intelligent Manufacturing Company, with additional collateral provided by the subsidiary in the
form of its property, plant and equipment and industrial land use rights;
Borrowings of RMB297,268,950.00 were guaranteed by China Fangda Group Co., Ltd. for its subsidiary
China Fangda Group Co., Ltd. Notes to Financial Statements
Fangda Construction Technology Company.
Item December 31, 2025 December 31, 2024
Lease payments 15,229,706.15 18,828,149.71
Less: unrecognized financing
expenses
Subtotal 13,621,726.16 15,766,997.67
Less: lease liabilities due within
one year
Total 8,979,546.87 10,652,607.48
Item December 31, 2025 December 31, 2024
Maintenance fee 1,175,044.50 917,063.27
Loss contract to be executed 280,345.71 369,328.45
Total 1,455,390.21 1,286,391.72
December 31, December 31,
Item Increase Decrease Reason
Assets-related
Government
subsidy
subsidy
Change (+,-)
December 31, Issued Transferred December 31,
Item Bonus
shares
shares reserves
Total of
capital 1,073,874,227.00 1,073,874,227.00
shares
Item December 31, 2024 Increase Decrease December 31, 2025
Capital premium
(share capital 2,903,850.98 2,903,850.98
premium)
Other capital
reserves
Total 4,357,948.33 4,357,948.33
Item December 31, Amount occurred in the current period December 31,
China Fangda Group Co., Ltd. Notes to Financial Statements
Less:
amount
Less:
written
amount
into After-tax
written into
other amount
other gains After-tax
Amount gains Less: attributed
and amount
before and Income tax to
transferred attributed to the
income tax transfer expenses minority
into parent
red into sharehold
gain/loss in
gain/los ers
previous
s in
terms
previou
s terms
I. Other
comprehensive
income that
-3,779,277.52 -3,779,277.52
cannot be
reclassified into
profit or loss
Including: Fair
value change of
investment in -3,779,277.52 -3,779,277.52
other equity
tools
incomes that
will be
re-classified
into gain and
loss
Including:
Investment real
estate measured
at fair value
Cash flow
-1,269,329.14 2,980,575.00 447,086.25 2,533,488.75 1,264,159.61
hedge reserve
Translatio
n difference of
foreign -533,034.30 295,507.38 295,993.10 -485.72 -237,041.20
exchange
statement
Other
miscellaneous 158,405,014.52 3,038,109.97 396,775.71 2,641,819.98 -485.72 161,046,834.50
income
Item December 31, 2024 Increase Decrease December 31, 2025
Statutory surplus
reserves
Item 2025 2024
Adjustment on retained profit of previous period 4,805,192,000.28 4,772,359,940.45
Total of retained profit at beginning of year adjusted
(+ for increase, - for decrease)
Retained profit adjusted at beginning of year 4,805,192,000.28 4,772,359,940.45
Plus: Net profit attributable to owners of the parent -515,466,884.24 144,813,705.53
Less: Statutory surplus reserves 1,393,611.78 5,728,420.02
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Common share dividend payable 53,693,711.35 85,909,938.16
Others 20,343,287.52
Closing retained profit 4,234,637,792.91 4,805,192,000.28
Item
Income Cost Income Cost
Main business 3,327,948,583.52 2,881,219,133.19 4,373,119,434.75 3,545,394,888.31
Other 42,747,408.17
businesses
Total 3,377,303,066.44 2,921,536,952.53 4,424,224,197.71 3,588,142,296.48
(1) Revenue disaggregation information
In 2025, the information of operating revenue broken down by revenue recognition time
is as follows:
Item 2025 2024
Revenue recognition time
Revenue recognized at a certain point in time 533,955,293.94 545,412,251.88
Revenue recognized over a period of time 2,843,347,772.50 3,878,811,945.83
Total 3,377,303,066.44 4,424,224,197.71
(2) Performance obligation
For curtain wall materials, real estate and other commodity sales transactions, the
Company completes the performance obligations when the customer obtains the control of the
relevant commodities; for providing building curtain wall, Metro screen door design,
production and installation and other service transactions, the Company confirms the
completed performance obligations according to the performance progress during the whole
service period. The contract price of the Company is usually due within one year, and there is
no significant financing component.
(3) Information related to remaining performance obligations
As of December 31, 2025, the Company's remaining contractual obligations are mainly
related to the Company's engineering contracts, and the remaining contractual obligations are
expected to be recognized as revenue according to the performance progress in the future
performance period of the corresponding engineering contracts.
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Property tax 21,128,884.70 20,235,700.43
City maintenance and
construction tax
Education surcharge and local
education surcharge
Stamp tax 2,646,316.83 5,125,991.22
Urban land use tax 2,148,696.57 1,967,709.57
Land VAT 162,267.96 4,535,890.32
Others 320,867.76 78,257.55
Total 36,011,342.42 43,364,391.34
Item 2025 2024
Labor costs 35,157,320.22 30,449,690.40
Entertainment expense 6,378,943.30 8,485,462.87
Travel expense 4,614,410.83 2,955,271.55
Advertisement and promotion fee 2,317,559.63 2,144,452.78
Rental 1,005,536.52 629,569.36
Depreciation and amortization 1,886,120.08 2,269,054.34
Material consumption 1,011,161.01 1,352,405.66
Sales agency fee 970,571.54 1,595,221.91
Office costs 731,950.25 895,531.77
Others 3,330,447.79 4,363,492.49
Total 57,404,021.17 55,140,153.13
Item 2025 2024
Labor costs 129,569,222.27 137,729,076.22
Depreciation and amortization 15,295,989.89 17,246,520.96
Agencies 9,092,377.02 6,918,578.15
Entertainment expense 5,941,257.55 7,993,709.32
Office expense 4,113,166.63 5,648,928.52
Travel expense 2,852,779.56 4,337,710.40
Rental 2,795,359.88 2,254,738.54
Water and electricity 1,764,753.20 1,204,391.67
Property management fee 1,221,908.37 1,102,485.41
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Lawsuit 1,194,968.95 296,491.06
Others 5,505,940.23 6,934,804.95
Total 179,347,723.55 191,667,435.20
Item 2025 2024
Labor costs 87,229,245.50 100,670,006.36
Material costs 29,787,750.26 50,544,384.90
Testing fees 9,776,489.95 11,574,101.52
Depreciation and amortization 3,651,149.36 4,730,697.11
Others 2,369,777.05 3,512,181.84
Total 132,814,412.12 171,031,371.73
Item 2025 2024
Interest expense 73,451,706.21 60,377,020.35
Including: interest expense of
lease liabilities
Less: discount government
subsidies
Less: Interest income 10,685,216.12 19,230,549.61
Net interest expenditure 61,127,490.09 38,530,270.74
Exchange net loss 3,446,327.54 -3,073,376.55
Discount expense 10,151,618.08 23,766,144.18
Commission charges and others 3,808,049.61 6,074,894.67
Total 78,533,485.32 65,297,933.04
Item 2025 2024
Government subsidy 9,734,296.68 14,027,285.85
Individual income tax withholding
handling fee
Additional deduction of input tax 562,972.73 5,373,030.49
Total 10,569,849.85 19,683,263.58
Item 2025 2024
Gains from long-term equity investment measured
-23,702,329.34 -70,043.43
by equity
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Investment income from disposal of trading
financial assets
Financial assets derecognized as a result of
-3,565,876.31 -2,538,217.26
amortized cost
Income from derecognition of other financial assets
-154,143.85
measured at fair value
Debt restructuring gains -118,701.78
Total -25,773,481.21 -4,547,362.60
Source of income from fluctuation of fair value 2025 2024
Investment real estate measured at fair value -280,731,968.67 -18,397,296.67
Other non-current financial assets -3,608.54 3,098.25
Transactional financial assets 410.06
Total -280,735,167.15 -18,394,198.42
Item 2025 2024
Bad debt loss of notes receivable -13,358,396.35 -237,783.09
Bad debt loss of account receivable -235,005,089.69 -109,795,711.27
Bad debt loss of other receivables -4,181,353.42 -653,357.89
Total -252,544,839.46 -110,686,852.25
Item 2025 2024
Inventory impairment loss -23,306,214.74
Contract asset impairment loss -4,669,897.78 -28,916,573.64
Impairment losses on property, plant and
-2,650,000.00 -2,500,000.00
equipment
Impairment losses on intangible assets -3,844,005.85
Total -30,626,112.52 -35,260,579.49
Item 2025 2024
Disposition not classified as possession of fixed
assets to be sold, construction in progress, and -2,097,446.78 -571,500.30
intangible assets
Including: Fixed assets -690,446.78 -571,500.30
Intangible assets -1,407,000.00
Disposal of other non-current assets -1,129,425.81
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Disposal of use right assets 194,594.82 71,307.49
Total -3,032,277.77 -500,192.81
Amount accounted
Item 2025 2024 into the current
accidental gain/loss
Penalty income 147,421.94 169,756.38 147,421.94
Compensation received 84,950.00 110,450.67 84,950.00
Payable account not able to be paid 1,105,933.49
Gains on disposal of non-current
assets
Others 342,226.94 291,705.96 342,226.94
Total 582,660.42 1,712,412.29 582,660.42
Amount accounted
Item 2025 2024 into the current
accidental gain/loss
Donation 530,000.00 50,000.00 530,000.00
Loss from retirement of damaged
non-current assets
Penalty and overdue fine 906,136.85 724,692.03 906,136.85
Others 16,034,265.87 815,503.59 16,034,265.87
Total 18,360,766.41 2,226,292.50 18,360,766.41
Note: "Other" includes a loss of RMB16,000,000.00 arising from the termination of the Bangshen
project; see Note V.9—Inventories for details.
(1) Composition of income tax expenses
Item 2025 2024
Income tax expenses in this period 37,186,918.12 31,496,973.61
Deferred income tax expenses -150,018,693.23 -18,304,449.34
Total -112,831,775.11 13,192,524.27
(2) Adjustment process of accounting profit and income tax expense
Item 2025 2024
Total profit -628,265,004.92 159,360,814.59
Income tax expenses calculated based on the legal
-157,066,251.23 39,840,203.65
(or applicable) tax rates
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Impacts of different tax rates applicable for some
subsidiaries
Impacts of income tax before adjustment 1,224,027.11 3,211,604.88
Impact of non-taxable income -44,361.26 -76,932.15
Impacts of non-deductible cost, expense and loss 5,703,572.23 4,712,097.88
Impact of deductible temporary differences or
deductible losses of unrecognized deferred income -1,309,161.43
tax assets in the prior period of use
Deductible temporary difference and deductible
loss of unrecognized deferred income tax assets
Additional deduction of R&D expense -18,869,349.63 -25,192,633.13
Profit and loss of associates and joint ventures
calculated using the equity method
Effect of tax rate change on deferred income tax -787,559.90 -910,541.83
Impact of deductible losses of deferred income tax
assets recognized in the previous period exceeding 13,984,223.73 1,173,737.80
the recoverable period
Income tax expenses -112,831,775.11 13,192,524.27
See Note V. 40 Other comprehensive income for details of each item of other
comprehensive income and its income tax effect and transfer to profit or loss, as well as a
reconciliation of each item of other comprehensive income.
(1) Cash inflow related to operation
Other cash received from business operations
Item 2025 2024
Interest income 10,824,216.12 13,149,043.03
Subsidy income 21,354,321.72 14,815,630.09
Retrieving of bidding deposits 41,527,537.45 32,822,259.64
Other operating accounts 31,388,726.08 26,028,503.64
Net amount of receipts from bills
and other deposits
Total 153,978,372.04 115,024,150.76
Other cash paid for business operations
Item 2025 2024
Pocket expenses 130,505,709.21 127,740,024.89
Bidding deposit paid 21,368,944.98 35,416,621.23
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Other trades 4,811,588.71 17,528,864.15
Total 156,686,242.90 180,685,510.27
(2) Cash related to investment activities
Significant cash payments related to investing activities
Item 2025 2024
Acquisition of non-controlling
interests in Fangda Zhiyuan 26,616,725.71
Company
Other cash paid for investment
Item 2025 2024
Foreign exchange investment
losses
(3) Cash related to financing
Other cash received from financing activities
Item 2025 2024
Recovery of loan deposits 100,842,000.00 133,000,000.00
Recovery of time deposits 330,600,944.44
Total 100,842,000.00 463,600,944.44
Other cash paid related to financing activities
Item 2025 2024
Financing fee 2,825,971.65 3,078,784.45
Principal and interest of lease
liabilities
Payment for repurchase of equity
interest in Fangda Zhiyuan
Payments to non-controlling
shareholders due to subsidiary 2,549,339.32 1,221,195.25
liquidation
Total 12,963,429.49 119,400,311.19
Changes in liabilities arising from financing activities
Increase Decrease
December 31, December
Item Change in Non-cash Change in Non-cash
cash change cash change
Short-term loans 1,663,696,422.48 1,416,692,628.24 17,355,048.96 1,881,823,195.75 13,074,406.90 1,202,846,497.03
Dividend
payable 53,693,711.35 53,693,711.35
Non-current
liabilities due in 128,469,517.74 406,279,362.16 161,418,917.27 373,329,962.63
China Fangda Group Co., Ltd. Notes to Financial Statements
Increase Decrease
December 31, December
Item Change in Non-cash Change in Non-cash
cash change cash change
Long-term loans 1,137,000,000.00 1,100,000,000.00 600,000,000.00 347,000,000.00 1,290,000,000.00
Lease liabilities 10,652,607.48 5,185,685.19 6,858,745.80 8,979,546.87
Total 2,939,818,547.70 2,516,692,628.24 482,513,807.66 2,696,935,824.37 366,933,152.70 2,875,156,006.53
(1) Supplementary data of cash flow statement
Supplementary information 2025 2024
business operations:
Net profit -515,433,229.81 146,168,290.32
Plus: Asset impairment provision 30,626,112.52 35,260,579.49
Credit impairment provision 252,544,839.46 110,686,852.25
Fixed asset and investment real estate depreciation 37,176,212.95 32,873,765.23
Depreciation of right to use assets 4,389,525.88 15,038,434.25
Amortization of intangible assets 5,155,196.09 7,362,948.39
Amortization of long-term amortizable expenses 4,393,633.54 3,854,633.92
Loss from disposal of fixed assets, intangible assets,
and other long-term assets ("-" for gains)
Loss from fixed asset discard ("-" for gains) 882,302.15 601,531.09
Loss from fair value fluctuation ("-" for gains) 280,735,167.15 18,394,198.42
Financial expenses ("-" for gains) 77,563,351.94 62,507,793.94
Investment losses ("-" for gains) 25,773,481.21 1,855,001.49
Decrease of deferred income tax asset ("-" for
-60,882,106.65 -34,722,077.39
increase)
Increase of deferred income tax asset ("-" for
-89,260,452.70 -6,409,546.15
increase)
Decrease of inventory ("-" for increase) -2,698,224.56 42,960,388.63
Decrease of operational receivable items ("-" for
increase)
Increase of operational receivable items ("-" for
-302,520,409.58 93,985,965.94
decrease)
Others 48,883,570.67 28,208,714.36
Cash flow generated by business operations, net 187,412,899.87 270,894,093.43
no cash involved:
Debt transferred to assets
Convertible corporate bonds due within one year
China Fangda Group Co., Ltd. Notes to Financial Statements
Supplementary information 2025 2024
Addition of right-of-use assets 3,811,719.28 13,743,381.24
Balance of cash at period end 1,090,965,547.89 1,031,725,216.34
Less: Initial balance of cash 1,031,725,216.34 779,661,118.42
Add: Ending balance of cash equivalents
Less: Ending balance of cash equivalents
Net increase in cash and cash equivalents 59,240,331.55 252,064,097.92
Note: During the current period, the amount of RMB180,124,519.21 received from the
endorsement and transfer of receivable notes was included in cash received from sales of
goods and rendering of services.
(2) Composition of cash and cash equivalents
Item December 31, 2025 December 31, 2024
I. Cash 1,090,965,547.89 1,031,725,216.34
Including: Cash in stock 697.90 148.01
Bank savings can be used at any time 1,078,821,930.02 1,024,641,201.90
Other monetary capital can be used at any time 12,142,919.97 7,083,866.43
Including: bond investment due within three
months
III. Balance of cash and cash equivalents at end of
term
Including: restricted cash and cash equivalent used
by parent company or subsidiaries in the Group
(3) Supplier Financing Arrangements
① Terms and Conditions of Supplier Financing Arrangements
Supplier financing arrangement 1: The Company utilizes the "eXintong" supply chain
financial service platform, jointly provided by Beijing Yuehan Technology Co., Ltd. and
Shenzhen Branch of China Construction Bank Corporation (hereinafter referred to as "CCB"),
to conduct reverse factoring transactions, offering services to suppliers holding electronic
receivable instruments on the "eXintong" platform that are payable by the Company upon
maturity. Suppliers transfer their accounts receivable under the Company's electronic debt
certificates to CCB and apply for "e-Xintong" business services from CCB. After analysis and
evaluation, CCB provides "e-Xintong" business services to suppliers if conditions are met.
The Company's obligation to fulfill payment under the electronic debt certificates is
China Fangda Group Co., Ltd. Notes to Financial Statements
unconditional and irrevocable, unaffected by any commercial disputes among parties involved
in the transfer of the electronic debt certificates. The Company will not claim offsets or
defenses regarding this payment obligation. The Company will transfer an amount equal to
the amount under the electronic debt certificates on the committed payment date according to
the "e-Xintong" platform business rules.
Supplier Financing Arrangement 2: The Company handles reverse factoring business
through the "e-Zhangtong" supply chain financial service platform provided by Agricultural
Bank of China Limited Shenzhen Overseas Chinese Town Branch (hereinafter referred to as
"ABC"), offering services to suppliers holding electronic debt certificates on the
"e-Zhangtong" platform with payments due from the Company. Suppliers transfer their
accounts receivable under the Company's electronic debt certificates to ABC and apply for
"e-Zhangtong" business services from ABC. After analysis and evaluation, ABC provides
"e-Zhangtong" business services to suppliers if conditions are met. The Company's obligation
to fulfill payment under the electronic debt certificates is unconditional and irrevocable,
unaffected by any commercial disputes among parties involved in the transfer of the
electronic debt certificates. The Company will not claim offsets or defenses regarding this
payment obligation. The Company will transfer an amount equal to the amount under the
electronic debt certificates on the committed payment date according to the "e-Zhangtong"
platform business rules.
Supplier Financing Arrangement 3: The Company has signed a "Payment Agency
Cooperation Agreement" with China Merchants Bank Co., Ltd. Shenzhen Branch, authorizing
the bank to deduct payments from the payment account on the dates specified in the "Detailed
Payment Agency List" provided by the Group. When suppliers initiate financing applications,
China Merchants Bank Co., Ltd. Shenzhen Branch uses the Company's credit line to handle
domestic factoring for suppliers. After the factoring matures, the Company only needs to pay
the factoring financing amount to China Merchants Bank Co., Ltd. Shenzhen Branch, without
interest.
Supplier Financing Arrangement 4: The Company handles reverse factoring (Easy Credit)
business through the supply chain financial service platform provided by Bank of China
Shenzhen Futian Branch (hereinafter referred to as "BOC"), offering services to suppliers
holding electronic debt certificates with payments committed by the Company. Suppliers
transfer their accounts receivable under the Company's electronic debt certificates to BOC and
China Fangda Group Co., Ltd. Notes to Financial Statements
apply for Easy Credit business services from BOC. After analysis and evaluation, BOC
provides Easy Credit business services to suppliers if conditions are met. The Company's
obligation to fulfill payment under the electronic debt certificates is unconditional and
irrevocable, unaffected by any commercial disputes among parties involved in the transfer of
the electronic debt certificates. The Company will not claim offsets or defenses regarding this
payment obligation. The Company will transfer an amount equal to the amount under the
electronic debt certificates on the committed payment date according to the supply chain
financial service platform business rules.
Supplier financing arrangement 5: The Company has entered into relevant agreements
with Bank of Shanghai Co., Ltd., authorizing Bank of Shanghai to, based on financing details
provided by the Company and via the "Shanghang e-Chain" platform, allow suppliers to
initiate financing applications and execute factoring transactions against the Company's credit
line with Bank of Shanghai. Upon maturity of the factoring facility, the Company is only
required to repay the principal amount of the factoring financing to Bank of Shanghai, while
the related interest is borne by the designated party as agreed.
② Financial liabilities under supplier financing arrangements presented in the balance
sheet and the carrying amount, as well as the amounts received by suppliers from financing
providers
Item December 31, 2025 December 31, 2024
Account payable 535,521,368.29 465,016,938.13
Including: Amounts received by
suppliers
③ Payment due date range for financial liabilities under supplier financing
arrangements
Item December 31, 2025 December 31, 2024
Financial liabilities under
supplier financing arrangements 90-300 days from invoice receipt 90-300 days from invoice receipt
Comparable accounts payable not
under supplier financing 0-180 days from invoice receipt 0-180 days from invoice receipt
arrangements
(1) Foreign currency monetary items:
Balance converted into
Foreign currency balance
Item Exchange rate RMB on December 31,
on December 31, 2025
China Fangda Group Co., Ltd. Notes to Financial Statements
Balance converted into
Foreign currency balance
Item Exchange rate RMB on December 31,
on December 31, 2025
Monetary capital 239,466,025.46
Including: Hong Kong
Dollar
Euro 247,321.86 8.2355 2,036,819.18
U.S. Dollar 23,572,087.83 7.0288 165,683,490.94
Singapore Dollar 2,173,283.21 5.4586 11,863,083.73
Vietnamese
Dong
Rupee 18,585,243.26 0.0783 1,455,224.55
Australian Dollar 5,712,726.73 4.6892 26,788,118.18
Dirham 105,189.93 1.9071 200,607.72
Philippine Peso 8,602,278.03 0.1195 1,027,972.22
Saudi Riyal 13,569.10 1.8680 25,347.62
Account receivable 42,841,960.18
Including: Hong
Kong Dollar
U.S. Dollar 2,825,905.87 7.0288 19,862,727.18
Singapore Dollar 1,471,623.38 5.4586 8,033,003.38
Australian Dollar 682,570.42 4.6892 3,200,709.21
Contract assets 88,704,919.11
Including: Hong
Kong Dollar
U.S. Dollar 4,031,412.60 7.0288 28,335,992.88
Rupee 11,258,301.46 0.0783 881,525.00
Australian Dollar 2,320,553.49 4.6892 10,881,539.43
Dirham 149,587.24 1.9071 285,277.83
Other receivables 2,025,531.07
Including: Hong Kong
Dollar
U.S. Dollar 23,239.05 7.0288 163,342.63
Singapore Dollar 144,049.35 5.4586 786,307.78
Rupee 620,785.33 0.0783 48,607.49
Australian Dollar 34,599.08 4.6892 162,242.01
Dirham 30,749.99 1.9071 58,643.31
Philippine Peso 221,398.00 0.1195 26,457.06
Saudi Riyal 15,000.33 1.8680 28,021.22
Account payable 26,163,925.16
China Fangda Group Co., Ltd. Notes to Financial Statements
Balance converted into
Foreign currency balance
Item Exchange rate RMB on December 31,
on December 31, 2025
Including: USD 1,005,776.11 7.0288 7,069,399.12
Singapore Dollar 365,446.54 5.4586 1,994,826.48
Rupee 14,804,553.01 0.0783 1,159,196.50
Australian Dollar 3,374,612.30 4.6892 15,824,232.00
Philippine Peso 158,805.69 0.1195 18,977.28
Saudi Riyal 52,083.35 1.8680 97,293.78
Other payables 2,045,959.56
Including: USD 273,407.62 7.0288 1,921,727.48
Singapore Dollar 3,901.85 5.4586 21,298.64
Australian Dollar 21,787.84 4.6892 102,167.54
Saudi Riyal 410.00 1.8680 765.90
Other non-current assets 166,996.84
Including: USD 23,758.94 7.0288 166,996.84
(1) The Company as leasee
Current gains and losses and cash flows related to leases
Item 2025
Short term lease expenses with simplified treatment included in current
profit and loss
Lease expenses of low value assets with simplified treatment included in
current profit and loss (except short-term lease)
Interest expense on lease liabilities 587,402.86
Variable lease payments included in current profits and losses but not
included in the measurement of lease liabilities
Income from subletting right to use assets
Total cash outflow related to leasing 48,460,651.06
(2) The Company is the leasor
Operating lease
A. Rental income
Item 2025
Rental income 120,590,265.17
Including: income related to variable lease payments not included in the
measurement of lease receipts
B. Undiscounted lease receipts to be received in each of the five consecutive fiscal years
China Fangda Group Co., Ltd. Notes to Financial Statements
after the balance sheet date, and the total undiscounted lease receipts to be received in the
remaining years
Year Amount
Total undiscounted lease receipts to be received on and after 2031 65,750,209.88
VI. R&D expenses
Item 2025 2024
Labor costs 87,229,245.50 100,670,006.36
Material costs 29,787,750.26 50,544,384.90
Testing fees 9,776,489.95 11,574,101.52
Depreciation and amortization 3,651,149.36 4,730,697.11
Others 2,369,777.05 3,512,181.84
Total 132,814,412.12 171,031,371.73
Including: Expensed R&D
expenditure
VII. Change to Consolidation Scope
During the current period, the scope of consolidation changed with the addition of two
new subsidiaries established by incorporation: Fangda Facade Contracting L.L.C and Fangda
Facade (NSW) Pty Ltd.
VIII. Equity in Other Entities
(1) Group Composition
Place of Registered Shareholding (%) Obtaining
Company Registered capital Business
business address Direct Indirect method
Designing,
Fangda Construction manufacturing,
RMB600,000,000 Shenzhen Shenzhen 98.66 1.34 Incorporation
Technology and installation
of curtain walls
Production,
Fangda Zhiyuan
RMB105,000,000 Shenzhen Shenzhen processing and 51.00 49.00 Incorporation
Technology
installation of
China Fangda Group Co., Ltd. Notes to Financial Statements
Place of Registered Shareholding (%) Obtaining
Company Registered capital Business
business address Direct Indirect method
subway screen
doors
Production and
sales of new
Fangda Jiangxi New
USD12,000,000 Nanchang Nanchang materials and 75.00 25.00 Incorporation
Material
composite
materials
Real estate
Fangda Property RMB200,000,000 Shenzhen Shenzhen development and 99.00 1.00 Incorporation
operation
Design and
Fangda New Energy RMB100,000,000 Shenzhen Shenzhen construction of 99.00 1.00 Incorporation
PV power plants
Trusted
Fangda Chengdu processing of
RMB50,000,000 Chengdu Chengdu - 100.00 Incorporation
Technology building curtain
wall materials
Virgin Virgin
Shihui International USD3,000,000 Investment 100.00 - Incorporation
Islands Islands
Installation and
Fangda Dongguan
RMB272,800,000 Dongguan Dongguan sales of building - 100.00 Incorporation
New Material
curtain walls
Fangda Property Property
RMB10,000,000 Shenzhen Shenzhen - 100.00 Incorporation
Management management
Fangda Jiangxi Real estate
Property RMB100,000,000 Nanchang Nanchang development and - 100.00 Incorporation
Development operation
Design and
Fangda Luxin New
RMB10,000,000 Pingxiang Pingxiang construction of - 100.00 Incorporation
Energy
PV power plants
Design and
Fangda Xinjian New
RMB10,000,000 Nanchang Nanchang construction of - 100.00 Incorporation
Energy
PV power plants
Design and
Fangda Dongguan
RMB10,000,000 Dongguan Dongguan construction of - 100.00 Incorporation
New Energy
PV power plants
Kechuangyuan Software
RMB5,000,000 Shenzhen Shenzhen - 100.00 Incorporation
Software development
Fangda Zhiyuan
Hong Hong Metro screen
Technology Hong HKD10,000 - 100.00 Incorporation
Kong Kong door
Kong
Fangda Investment
RMB100,000,000 Shenzhen Shenzhen Investment 98.00 2.00 Incorporation
Holding Company
Designing,
manufacturing,
Fangda Australia AUD600,000 Australia Australia - 100.00 Incorporation
and installation
of curtain walls
Technology
development and
sales; Invest in
industry;
Shenzhen Shenzhen Incorporation
Fangda Yunzhi RMB50,000,000 Operation - 100.00
management of
science and
technology park
Building
decoration and
Chengda Curtain Chengdu Chengdu other Incorporation
RMB50,000,000 - 100.00
Wall Company construction
industry
China Fangda Group Co., Ltd. Notes to Financial Statements
Place of Registered Shareholding (%) Obtaining
Company Registered capital Business
business address Direct Indirect method
Designing,
Fangda Southeast manufacturing,
Vietnam Vietnam Incorporation
RMB3,000,000 and installation - 100.00
Asia of curtain walls
Intelligent
technology, new
Fangda Shanghai Shanghai Shanghai energy, Incorporation
RMB100,000,000 30.00 70.00
Zhijian automated
technology
Construction
technology,
intelligent
technology,
automation
Fangda Shanghai Shanghai Shanghai technology, 100.00 Incorporation
RMB50,000,000 -
Jianzhi design,
production and
installation of
building curtain
walls
Shenzhen Shenzhen Business service 55.00 Purchase
Zhongrong Litai RMB121,000,000 -
Fangda Construction Design, sale and
Hong Hong installation of
Technology Hong HKD10,000 Kong Kong building curtain
wall
Kong
Inspection,
technical service Consolidation
and consultation of entities
Shenzhen Shenzhen of building 100.00 under
Yunzhu Technology RMB10,000,000
safety and common
building energy control
saving system
Inspection,
technical service Consolidation
and consultation of entities
Fangda Yunzhu Shenzhen Shenzhen of building 100.00 under
RMB5,000,000
Testing safety and common
building energy control
saving system
Production,
processing and
General Metro Singapore Singapore installation of Incorporation
SGD1,500,000 100.00
Technology Co., Ltd subway screen
doors
Production,
processing and
Fangda Zhiyuan Wuhan Wuhan installation of Incorporation
RMB10,000,000 100.00
Technology Wuhan subway screen
doors
Production,
Fangda Zhiyuan processing and
Nanchang Nanchang installation of Incorporation
Technology RMB1,000,000 100.00
subway screen
Nanchang doors
Production,
Dongguan Dongguan processing and Incorporation
Fangda Zhiyuan RMB1,000,000 100.00
installation of
China Fangda Group Co., Ltd. Notes to Financial Statements
Place of Registered Shareholding (%) Obtaining
Company Registered capital Business
business address Direct Indirect method
subway screen
Dongguan doors
Production and
sales of new
Fangda Intelligent Ganzhou Ganzhou materials and Incorporation
RMB2,500,000,000 99.00 1.00
Manufacturing composite
materials
Installation and
Shenzhen Shenzhen sales of building Incorporation
Fangda Jianchuang RMB50,000,000 100.00
curtain walls
Fangda Construction Installation and
Technology Shenzhen Shenzhen sales of building Non-business
RMB50,000,000 100.00
Company curtain walls combination
Installation and
Fangda Facade
SGD799,611 Singapore Singapore sales of building 100.00 Incorporation
Singapore Pte Ltd
curtain walls
Installation and
FANGDA FACADE
Philippine Philippine sales of building
PHILIPPINES INC. PHP12,000,000 98.999 Incorporation
curtain walls
Metro screen
Zhiyuan Philippines
PHP12,000,000 Philippine Philippine door sales and 99.999 Incorporation
Company
installation
Installation and
FANGDA GULF
AED400,000 Dubai Dubai sales of building 100.00 Incorporation
DMCC
curtain walls
Designing,
GLOBAL MEGA Saudi Saudi manufacturing,
INTERNATIONAL USD600,000 Arabia Arabia and installation 100.00 Incorporation
of curtain walls
FANGDA FACADE Installation and
CONTRACTING AED1,000,000 Dubai Dubai sales of building 100.00 Incorporation
L.L.C curtain walls
Installation and
Fangda Facade
AUD500,000 Australia Australia sales of building 100.00 Incorporation
(NSW) Pty Ltd
curtain walls
(2) Major non wholly-owned subsidiaries
Profit and loss Dividend to be Interest balance of
Shareholding of
attributed to distributed to minority
Company minority
minority minority shareholders in the
shareholders
shareholders shareholders end of the period
Zhongrong Litai 45.00% 35,230.12 48,343,241.08
(3) Financial highlights of major non wholly owned subsidiaries
December 31, 2025
Company Current Non-current Total of Current Non-current Total
assets assets assets liabilities liabilities liabilities
Zhongrong Litai 210,411,282.10 26,300.00 210,437,582.10 103,008,157.51 103,008,157.51
(Continued)
December 31, 2024
Company Current Non-current Total of Current Non-current Total
assets assets assets liabilities liabilities liabilities
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2024
Company Current Non-current Total of Current Non-current Total
assets assets assets liabilities liabilities liabilities
Zhongrong Litai 209,711,213.30 31,600.00 209,742,813.30 102,391,677.87 102,391,677.87
Company Total of misc. Business operation
Turnover Net profit
incomes cash flows
Zhongrong Litai 110,091.72 78,289.16 78,289.16 -379,966.11
(Continued)
Company Total of misc. Business operation
Turnover Net profit
incomes cash flows
Zhongrong Litai 110,091.72 19,074.18 19,074.18 -27,370.15
(1) Financial summary of insignificant joint ventures and associates
December 31, 2025/ December 31, 2024/
Item
Associate:
Total book value of investment 32,988,644.63 56,690,973.97
Total shareholding
——Net profit -23,702,329.34 -70,043.43
——Other miscellaneous income
——Total of misc. incomes -23,702,329.34 -70,043.43
IX. Government subsidy
As of December 31, 2025, the balance of government grants receivable is
RMB527,217.36.
Items
Balance on Balance on
presented Other misc.
Tuesday, Amount of new Wednesday,
in the gains recorded Assets/earning-related
December 31, subsidy December 31,
balance this period
sheet
Deferred
earning
Total 10,669,612.13 17,776,306.00 2,141,640.44 26,304,277.69 -
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024 Assets/earning-related
Other gains 2,141,640.44 630,958.59 Assets-related
Other gains 7,592,656.24 13,396,327.26 Earning-related
Financial expenses 1,639,000.00 2,616,200.00 Earning-related
Total 11,373,296.68 16,643,485.85
X. Risks of Financial Tools
The risks associated with the financial instruments of the Company arise from the
various financial assets and liabilities recognized by the Company in the course of its
operations, including credit risks, liquidity risks and market risks.
The management objectives and policies of various risks related to financial instruments
are governed by the management of the Company. The operating management is responsible
for daily risk management through functional departments (for example, the Company's credit
management department reviews the Company's credit sales on a case-by-case basis). The
internal audit department of the Company conducts daily supervision of the implementation
of the Company's risk management policies and procedures, and reports relevant findings to
the Company's audit committee in a timely manner.
The overall goal of the Company's risk management is to formulate risk management
policies that minimize the risks associated with various financial instruments without
excessively affecting the Company's competitiveness and resilience.
Credit risk is caused by the failure of one party of a financial instrument in performing
its obligations, causing the risk of financial loss for the other party. The credit risk of the
Company mainly comes from monetary capital, notes receivable, accounts receivable, other
receivables, receivables financing, contract assets, etc. The credit risk of these financial assets
comes from the default of the counterparties, and the maximum risk exposure is equal to the
book amount of these instruments.
The Company's money and funds are mainly deposited in the commercial banks and
other financial institutions. The Company believes that these commercial banks have higher
reputation and asset status and have lower credit risk.
For notes receivable, accounts receivable, other receivables, receivables financing and
China Fangda Group Co., Ltd. Notes to Financial Statements
contract assets, the Company sets relevant policies to control credit risk exposure. The Group
set the credit line and term for debtors according to their financial status, external rating, and
possibility of getting third-party guarantee, credit record and other factors. The Group
regularly monitors debtors' credit record. For those with poor credit record, the Group will
send written payment reminders, shorten or cancel credit term to lower the general credit risk.
(1) Significant increases in credit risk
The credit risk of the financial instrument has not increased significantly since the initial
confirmation. In determining whether the credit risk has increased significantly since the
initial recognition, the Company considers reasonable and evidenced information, including
forward-looking information, that can be obtained without unnecessary additional costs or
effort. The Company determines the relative risk of default risk of the financial instrument by
comparing the risk of default of the financial instrument on the balance sheet date with the
risk of default on the initial recognition date to assess the credit risk of the financial
instrument from initial recognition.
When one or more of the following quantitative and qualitative criteria are triggered, the
Company believes that the credit risk of financial instruments has increased significantly: the
quantitative criteria are mainly the probability of default in the remaining life of the reporting
date increased by more than a certain proportion compared with the initial recognition; the
qualitative criteria are the major adverse changes in the operation or financial situation of the
major debtors, the early warning of customer list, etc.
(2) Definition of assets where credit impairment has occurred
In order to determine whether or not credit impairment occurs, the standard adopted by
our company is consistent with the credit risk management target for related financial
instruments, and quantitative and qualitative indicators are considered.
Major financial difficulties have occurred to the issuer or the debtor; Breach of contract
by the debtor, such as payment of interest or default or overdue of principal; (B) The
concession that the debtor would not make under any other circumstances for economic or
contractual considerations relating to the financial difficulties of the debtor; The debtor is
likely to be bankrupt or undertake other financial restructuring; The financial difficulties of
the issuer or debtor lead to the disappearance of the active market for the financial asset; To
purchase or generate a financial asset at a substantial discount, which reflects the fact that a
China Fangda Group Co., Ltd. Notes to Financial Statements
credit loss has occurred.
Credit impairment in financial assets may be caused by a combination of multiple events,
not necessarily by events that can be identified separately.
(3) Expected credit loss measurement
Depending on whether there is a significant increase in credit risk and whether a credit
impairment has occurred, the Company prepares different assets for a 12-month or full
expected credit loss. The key parameters of expected credit loss measurement include default
probability, default loss rate and default risk exposure. Taking into account the quantitative
analysis and forward-looking information of historical statistics (such as counterparty ratings,
guaranty methods, collateral categories, repayment methods, etc.), the Company establishes
the default probability, default loss rate and default risk exposure model.
Definition:
The probability of default refers to the possibility that the debtor will not be able to fulfil
its obligation to pay in the next 12 months or throughout the remaining period.
Breach Loss Rate means the extent of loss expected by the Company for breach risk
exposure. Depending on the type of counterparty, the manner and priority of recourse, and the
different collateral, the default loss rate is also different. The default loss rate is the percentage
of the risk exposure loss at the time of the default, calculated on the basis of the next 12
months or the entire lifetime.
Exposure to default is the amount payable to the Company at the time of default in the
next 12 months or throughout the remaining life. The assessment of significant increases in
credit risk and the calculation of expected credit losses both involve forward-looking
information. Through the analysis of historical data, the Company has identified the key
economic indexes that affect the credit risk of each business type and the expected credit loss.
The largest credit risk facing the Group is the book value of each financial asset on the
balance sheet. The Group makes no guarantee that may cause the Group credit risks. Among
the Company's accounts receivable, the accounts receivable (including contract assets) from
the top five customers accounted for 12.02% of the total accounts receivable (prior period:
counterparties by amount accounted for 70.50% of the total other receivables (prior period:
China Fangda Group Co., Ltd. Notes to Financial Statements
Liquidity risk is the risk of capital shortage when the Group needs to pay cash or settled
with other financial assets. The Company is responsible for the cash management of its
subsidiaries, including short-term investments in cash surpluses and loans to meet projected
cash requirements. The Company's policy is to regularly monitor short and long-term liquidity
requirements and compliance with borrowing agreements to ensure adequate cash reserves
and readily available securities.
As of December 31, 2025, the maturity of the Company's financial liabilities is as
follows:
In RMB10,000
December 31, 2025
Item Less than 1
Within 1-3 years Over 3 years Total
year
Short-term loans 120,284.65 120,284.65
Notes payable 42,911.06 42,911.06
Account payable 200,969.52 1,659.43 1,440.17 204,069.12
Employees' wage payable 6,781.28 6,781.28
Other payables 5,087.03 1,622.93 5,827.31 12,537.27
Non-current liabilities due in 1
year
Other current liabilities 6,091.89 6,091.89
Long-term loans 30,000.00 99,000.00 129,000.00
Lease liabilities 739.16 158.79 897.95
Total 420,034.35 34,021.52 106,426.27 560,482.14
(Continued)
December 31, 2024
Item Less than 1
Within 1-3 years Over 3 years Total
year
Short-term loans 166,369.64 - - 166,369.64
Derivative financial liabilities 152.06 - - 152.06
Notes payable 68,118.81 - - 68,118.81
Account payable 213,195.52 297.46 1,166.51 214,659.49
Other payables 8,013.60 1,109.24 2,968.96 12,091.80
Non-current liabilities due in 1
year
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2024
Item Less than 1
Within 1-3 years Over 3 years Total
year
Other current liabilities 5,083.56 - - 5,083.56
Long-term loans - 96,700.00 17,000.00 113,700.00
Lease liabilities - 923.06 142.20 1,065.26
Total 473,780.14 99,029.76 21,277.67 594,087.57
(1) Credit risks
The exchange rate risk of the Company mainly comes from the assets and liabilities of
the Company and its subsidiaries in foreign currency not denominated in its functional
currency. Except for the Company's subsidiaries established in the Hong Kong Special
Administrative Region of the People's Republic of China and other overseas jurisdictions,
which use Hong Kong Dollars, U.S. Dollars, Australian Dollars, Vietnamese Dong, Euros,
Indian Rupees, UAE Dirhams, or Singapore Dollars for pricing and settlement, the
Company's other principal operations are priced and settled in RMB.
As of Wednesday, December 31, 2025, the foreign currency financial assets and foreign currency
financial liabilities of the Company at the end of the period are listed in the description of foreign currency
monetary items in Note V, 61.
The Company pays close attention to the impact of exchange rate changes on the
Company's exchange rate risk. The Company continuously monitors the scale of foreign
currency transactions and foreign currency assets and liabilities to minimize foreign exchange
risks. To this end, the Company may avoid foreign exchange risks by signing forward foreign
exchange contracts or currency swap contracts.
(2) Exchange rate risk
The Group's interest rate risk mainly arises from long-term interest-bearing debts such as
long-term bank loans. Financial liabilities with floating interest rate cause cash flow interest
rate risk for the Group. Financial liabilities with fixed interest rate cause fair value interest
rate risk for the Group. The Group decides the proportion between fixed interest rate and
floating interest rate according to the market environment and regularly reviews and monitors
the combination of fixed and floating interest rate instruments.
The Finance Department at the Company's head office monitors the level of the Group's
China Fangda Group Co., Ltd. Notes to Financial Statements
interest rates on an ongoing basis. The rising interest rate will increase the cost of the new
interest-bearing debt and the interest expenditure on interest-bearing debt which has not yet
been paid by the Company at the floating rate, and will have a significant adverse effect on
the Company's financial performance. Management will make adjustments in time according
to the latest market conditions.
For the period ended December 31, 2025, assuming all other risk variables remain
unchanged, if the interest rate on borrowings calculated at floating rates were to increase or
decrease by 50 basis points, the Company's net profit for the year would decrease or increase
by RMB6,502,300 (prior period: RMB4,800,000).
(1) Risk management of hedging operations
The impact of
Economic Effective
the
Corresponding risk Qualitative and relationships achievement
corresponding
management quantitative between hedged of expected
Item hedging
strategies and information about the items and related risk
activities on
objectives hedged risk hedging management
the risk
instruments objectives
exposure
The Company uses The Company
aluminum futures to has formulated
Utilizing the hedging hedge aluminum-related relevant internal
The underlying
function of futures tools, raw materials in its management
variables are
the Company carries out prospective procurement
standard aluminum systems for its
aluminum futures business. The Company aluminum
prices, and the Buy or sell
hedging business to adopts the strategy of futures hedging
values of hedged corresponding
reasonably avoid the dynamic hedging of
items and hedging and forward aluminum
risks brought about by commodity price risk
Aluminum instruments change foreign futures contracts
fluctuations in the prices exposure by adjusting its exchange trading
futures in opposite to hedge the risk
of relevant raw futures contract position business, and
hedging directions due to exposure
materials to its according to a certain continuously
facing the same existing in the
operations, to enhance percentage of its evaluates the
hedged risks, and spot business
the Company's overall prospective procurement effectiveness of
there is a side.
ability to withstand risks exposure, and the hedging to
relationship of
and to strengthen the exposure* hedging ratio is
mutual hedging of ensure that the
robustness of its basically the same as the hedging
risks.
operating activities. quantity of the commodity relationship is
represented by the futures effective in the
position. designated
Utilizing the hedging The Company uses The underlying accounting
and protection function forward foreign exchange variables are all period, and that
the risks of Buy or sell
of forward foreign contracts to hedge foreign currency
corresponding
Forward exchange contracts, the expected receivables. The exchange rates. The fluctuations in
raw material forward foreign
foreign Company carries out the Company employs a exchange rates of
exchange
exchange business of hedging strategy of dynamic the hedged item and purchasing
prices and contracts to
contract foreign currency hedging of exchange rate the hedging
hedge the risk
value receivables in order to exposures, whereby instrument change exchange rate
fluctuations of exposure of
preservation reasonably avoid the foreign exchange contract in opposite
foreign-currency foreign currency
risks brought by positions are adjusted directions due to
receivables are receivables.
exchange rate according to a certain exposure to the
fluctuations to its percentage of the expected same hedged risk, controlled within
China Fangda Group Co., Ltd. Notes to Financial Statements
The impact of
Economic Effective
the
Corresponding risk Qualitative and relationships achievement
corresponding
management quantitative between hedged of expected
Item hedging
strategies and information about the items and related risk
activities on
objectives hedged risk hedging management
the risk
instruments objectives
exposure
operations, enhance the foreign currency and there is a a reasonable
Company's overall receivable exposure, and relationship of risk range, so as to
ability to withstand the ratio of the exposure* hedging. enhance the
risks, and strengthen the hedge is essentially the Company's
soundness of its same as the receivable risk-resistance
operating activities. represented by the ability and
contract position. increase the
robustness of its
operating
activities.
(2) Eligible hedging operations and application of hedge accounting
Carrying value Cumulative fair value hedge
Hedge Impact of hedge
associated with adjustments to hedged items
effectiveness and accounting related to
Item hedged items included in the carrying
sources of hedge the Company's financial
and hedging value of the hedged item
ineffectiveness statements
instruments recognized
Types of hedge risk
Derivative financial
assets:
RMB1,459,950.00
Relevance of
Price risk Inapplicable hedged items to
hedging instruments income:
RMB1,240,957.50
Deferred tax liabilities:
RMB218,992.50
Relevance of
Exchange rate Finance costs:
Inapplicable hedged items to
hedging instruments RMB97,537.72
risk
Type
Derivative financial
assets:
RMB1,459,950.00
Other comprehensive
Relevance of
Cash flow income:
hedging instruments RMB1,240,957.50
hedging
Deferred tax liabilities:
RMB218,992.50
Finance costs:
RMB97,537.72
(1) Classification of financial assets by method of transfer
China Fangda Group Co., Ltd. Notes to Financial Statements
Transfer
Amount of
method of Nature of financial
financial assets Derecognization Basis for judging derecognization
financial assets transferred
transferred
assets
Promissory notes used for
discounting or endorsement are
accepted by banks or enterprises
Endorsement Outstanding with low credit ratings,
Not
or promissory notes 40,781,530.88 discounting or endorsement does
derecognized
discounting in notes receivable not affect recourse, and the credit
risk and deferred payment risk
associated with the notes remain
untransferred
Bankers' acceptances used for
Outstanding discounting or endorsement are
Endorsement bankers' accepted by banks with high
or acceptances in 33,761,787.71 Derecognization credit ratings and the credit risk
discounting receivables and deferred payment risk
financing associated with the instruments
are low
Outstanding
receivables in
Factoring 105,859,442.51 Derecognization Non-recourse factoring
receivables
financing
Total - 180,402,761.10 - -
(2) Financial assets derecognized due to transfers
Transfer method of Gain or loss related to
Item De-recognized amount
financial assets the de-recognition
Outstanding bankers'
Endorsement or
acceptances in 33,761,787.71
discounting
receivables financing
Account receivable Factoring 105,859,442.51 -3,565,876.31
Total - 139,621,230.22 -3,565,876.31
XI. Fair Value
The level of fair value measurement results is determined by the lowest level of input
values of importance to the fair value measurement as a whole:
First level: quotation of same assets or liabilities in an active market (unadjusted)
Second level: a directly or indirectly observable input value of the asset or liability in
addition to the first level input value.
Third level: unobservable input value of the related asset or liability.
value
China Fangda Group Co., Ltd. Notes to Financial Statements
Fair Value on Wednesday, December 31, 2025
Item First level Second level Third level fair
Total
fair value fair value value
measurement
(I) Transactional financial assets 1,460,360.06 1,460,360.06
value with variations accounted 1,460,360.06 1,460,360.06
into current income account
(1) Derivative financial assets 1,459,950.00 1,459,950.00
(II) Investment property 5,548,371,426.50 5,548,371,426.50
(III) Other non-current financial
assets
Total assets measured at fair value
continuously
(IV) Transactional financial
liabilities
Total assets measured at fair value
continuously
Total assets measured at fair value
continuously
For the financial instruments traded in the active market, the Company determines their
fair value based on their quoted prices in the active market; for the financial instruments not
traded in the active market, the Company adopts valuation technology to determine their fair
value. The valuation models are mainly cash flow discount model and market comparable
company model. The input value of valuation technology mainly includes risk-free interest
rate, benchmark interest rate, exchange rate, credit point difference, liquidity premium, lack of
liquidity discount, etc.
parameters of continuous and discontinuous second level fair value items
For derivative financial assets and derivative financial liabilities with fair value of
forward exchange contracts, the fair value is determined based on the market value of
expected earnings at the balance sheet date.
Receivables financed at fair value through other comprehensive income are notes
receivable, for which the fair value is determined based on the book value due to the short
remaining maturity.
China Fangda Group Co., Ltd. Notes to Financial Statements
parameters of continuous and discontinuous third level fair value items
Investment properties measured at fair value are appraised using the comparative and
income approaches. Comparison method: It selects a certain number of comparable examples,
compares them with the valuation object and processes the comparable instance transaction
prices according to the difference to obtain the value or price of the valuation object. The
income approach is a method of predicting the future earnings of the object of valuation, and
using the rate of compensation or capitalization rate, income multiplier to convert the future
earnings into value to get the value or price of the object of valuation.
Financial assets and liabilities measured at amortized cost include: monetary capital, bills
receivable, accounts receivable, other receivables, short-term borrowings, notes payable,
accounts payables, other payables, and long-term payables.
XII. Related Parties and Transactions
Criteria for identifying related parties: Parties are considered related if one party controls,
jointly controls, or exercises significant influence over another party, or if two or more parties
are subject to common control or joint control by the same party.
Registered Legal
Major shareholder Relationship Ownership type Business
address representative
Shenzhen Banglin
Affiliated Limited liability Industrial
Technologies Shenzhen Chen Jinwu
party company investment
Development Co., Ltd.
Affiliated Limited liability Hong Xiong Industrial
Shengjiu Investment Ltd.
party company Kong Jianming investment
Major shareholders (Continued):
Registered capital (in Shareholding in the Voting rights in the
Major shareholder
RMB10,000) Company (%) Company (%)
Shenzhen Banglin Technologies
Development Co., Ltd.
Shengjiu Investment Ltd. HKD100.00 10.73 10.73
Notes:
① The major shareholder of the Company, Shenzhen Banglin Technology Development
Co., Ltd., is wholly owned by natural persons, among whom Mr. Xiong Jianming, Chairman
of the Company, holds 85% of the shares, and Mr. Xiong Xi, Vice Chairman of the Company,
China Fangda Group Co., Ltd. Notes to Financial Statements
holds 15% of the shares.
② Among the top 10 shareholders, Shenzhen Banglin Technology Development Co.,
Ltd. and Shengjiu Investment Co., Ltd. are acting in concert.
③ The final controller of the Company is Xiong Jianming.
For details of subsidiaries of the enterprise, please refer to Note VIII, rights and interests
in other entities.
(1) Important joint ventures and associates of the Company
The Company's significant joint ventures or associates are disclosed in Note 8, "Interests
in Other Entities."
(2) During the reporting period, the related party transactions with the Company and
other joint ventures or joint ventures with the balance formed by the related party transactions
with the Company are as follows:
Joint venture or associate Relationship with the Company
Shenzhen Ganshang Joint Investment Co., Ltd. Affiliates of the Company
Other related parties Relationship with the Company
Shenzhen Yikang Real Estate Co. Ltd. Controlled subsidiaries
Shenzhen Skylot Technology Co., Ltd. Common actual controller
Director, manager and secretary of the Board Key management
(1) Related transactions for purchase and sale of goods, provision and acceptance of
services
Sales of goods and services
Associated party Related transaction 2025 2024
Shenzhen Skylot Property service and
Technology Co., Ltd. sales of goods
(2) Related leasing
The Company is the leasor:
China Fangda Group Co., Ltd. Notes to Financial Statements
Category of asset for Recognized in 2025 Recognized in 2024
Name of the leasee
lease Rental income Rental income
Shenzhen Skylot
Houses & buildings 86,857.14 86,857.15
Technology Co., Ltd.
(3) Related guarantees
The Company is the guarantor:
Whether the
Amount
guarantee has been
Beneficiary party guaranteed Start date Due date
fully performed
(RMB10,000)
Fangda
Construction 93,000.00 December 28, 2023 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 24,000.00 May 27, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 4,000.00 June 20, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 39,000.00 January 24, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 30,000.00 October 20, 2023 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 30,000.00 December 21, 2023 Three years after the expiration date Yes
Technology of debt performance
Fangda Zhiyuan 36,000.00 June 27, 2024 Three years after the expiration date Yes
of debt performance
Fangda Zhiyuan 15,000.00 May 30, 2024 Three years after the expiration date Yes
of debt performance
Fangda Zhiyuan 10,000.00 September 25, 2023 Three years after the expiration date Yes
of debt performance
Fangda Zhiyuan 10,000.00 December 21, 2023 Three years after the expiration date Yes
of debt performance
Fangda Property 135,000.00 February 25, 2020 Three years after the expiration date Yes
of debt performance
Fangda New
Material of debt performance
Fangda New
Material of debt performance
Fangda Zhijian 7,000.00 May 08, 2024 Three years after the expiration date Yes
of debt performance
Fangda Yunzhu 1,000.00 May 07, 2024 Three years after the expiration date Yes
of debt performance
Fangda Yunzhu 1,000.00 June 28, 2024 Three years after the expiration date Yes
of debt performance
Fangda Yunzhu 600.00 June 03, 2024 Three years after the expiration date Yes
of debt performance
Fangda Dongguan
New Material of debt performance
Fangda
Construction
China Fangda Group Co., Ltd. Notes to Financial Statements
Whether the
Amount
guarantee has been
Beneficiary party guaranteed Start date Due date
fully performed
(RMB10,000)
Technology of debt performance
Fangda
Construction 15,000.00 May 11, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 50,000.00 September 04, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 30,000.00 November 11, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 60,000.00 June 27, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 20,000.00 December 27, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda
Construction 60,000.00 December 19, 2024 Three years after the expiration date Yes
Technology of debt performance
Fangda Zhiyuan 35,800.00 June 27, 2024 Three years after the expiration date Yes
of debt performance
Fangda Zhiyuan 20,000.00 November 11, 2024 Three years after the expiration date Yes
of debt performance
Fangda Zhiyuan 15,000.00 September 04, 2024 Three years after the expiration date Yes
of debt performance
Fangda Zhiyuan 10,000.00 May 11, 2024 Three years after the expiration date Yes
of debt performance
Total amount of
guarantee fulfilled
Fangda
Construction 101,000.00 December 21, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 39,000.00 January 14, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 15,000.00 July 01, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 48,000.00 December 15, 2024 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 11,150.00 August 16, 2023 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 50,000.00 July 16, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 20,000.00 December 09, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 25,000.00 January 10, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 4,900.00 April 28, 2025 Three years after the expiration date No
Technology of debt performance
Fangda 20,000.00 November 04, 2024 Three years after the expiration date No
China Fangda Group Co., Ltd. Notes to Financial Statements
Whether the
Amount
guarantee has been
Beneficiary party guaranteed Start date Due date
fully performed
(RMB10,000)
Construction of debt performance
Technology
Fangda
Construction 40,000.00 August 07, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 35,000.00 April 21, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 30,000.00 March 27, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 25,000.00 December 23, 2025 Three years after the expiration date No
Technology of debt performance
Fangda
Construction 60,000.00 December 12, 2025 Three years after the expiration date No
Technology of debt performance
Fangda Zhijian 7,000.00 June 30, 2025 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 18,000.00 December 15, 2024 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 35,800.00 July 22, 2025 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 20,000.00 April 21, 2025 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 10,000.00 December 09, 2025 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 15,000.00 July 16, 2025 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 10,000.00 July 01, 2025 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 15,475.00 November 21, 2023 Three years after the expiration date No
of debt performance
Fangda Zhiyuan 15,000.00 January 13, 2025 Three years after the expiration date No
of debt performance
Fangda Yunzhu 1,000.00 March 25, 2025 Three years after the expiration date No
of debt performance
Fangda Yunzhu 700.00 April 21, 2025 Three years after the expiration date No
of debt performance
Fangda New
Material of debt performance
Fangda Property 110,000.00 April 02, 2025 Three years after the expiration date No
of debt performance
Fangda Intelligent
Manufacturing of debt performance
Fangda Zhiyuan 31,896.02 February 17, 2024 Date of project contract completion No
Fangda Zhiyuan 24,885.16 February 17, 2024 Date of project contract completion No
Dongguan New
Materials of debt performance
China Fangda Group Co., Ltd. Notes to Financial Statements
Whether the
Amount
guarantee has been
Beneficiary party guaranteed Start date Due date
fully performed
(RMB10,000)
Total amount of
guarantee being 882,306.18
performed
Description of related party guarantee: The above-mentioned guarantees are all
associated guarantees within interested entities of the Company.
(1) Receivable interest
December 31, 2025 December 31, 2024
Item Affiliated party Remaining book Bad debt Remaining Bad debt
value provision book value provision
Shenzhen Skylot
Account
Technology Co., 10,048.39 100.48 85,792.00 857.92
receivable
Ltd.
Shenzhen
Other Ganshang Joint
receivables Investment Co.,
Ltd.
Shenzhen Yikang
Other
Real Estate Co. 76,062,675.83 760,626.76 76,062,675.83 1,133,333.87
receivables
Ltd.
(2) Receivable interest
Item Affiliated party December 31, 2025 December 31, 2024
Shenzhen Yikang Real
Other payables 26,159,711.72 26,159,711.72
Estate Co. Ltd.
Shenzhen Skylot
Other payables 19,760.00 19,760.00
Technology Co., Ltd.
Shenzhen Ganshang
Other payables Joint Investment Co., 3,355.36 3,355.36
Ltd.
XIII. Contingent events
In July 2018 ,the Company's subsidiary Fangda Real Estate Co. Ltd. (Party A) signed a
contract with Shenzhen Yikang Real Estate Co. Ltd. (Party B1) and Shenzhen Qianhai
Zhongzheng Dingfeng No. 6 Investment Enterprise (Limited Partnership) (Party B2),
"Shenzhen Henggang Dakang Village Project Cooperation Agreement". Party B agrees to
transfer the entire equity of the project company it holds and the entire development interest
of the project to Party A. Party A shall pay Party B a total of RMB600 million for the
cooperation price. As of December 31, 2025, Fangda Property has paid Party B and the
China Fangda Group Co., Ltd. Notes to Financial Statements
project company RMB50 million of security deposit, RMB20 million of service fee,
RMB61,937,200 of equity transfer and RMB81,862,200 of other related payments.
The Company has no other commitments that should be disclosed by December 31,
Significant contingencies on the balance sheet date:
(1) Litigation Matters
Initiation Project Litigation/Arbitration Case Status as of
Case Type Plaintiff Defendant/Respondent
Date Involved Claims December 31, 2025
construction contract;
liquidated damages
related to delay and
quality defects
amounting to
RMB13,721,315.00;
contract price totaling
Langfang
RMB6,000,000;
Aomei Jiyeh As of the disclosure date of
June 19, Fangda Construction Langhefang 4. Additional claims
Real Estate this report, the case is still
Development
Technology Project filed subsequently for
under trial.
repair works
Co., Ltd.
amounting to
RMB22,935,269.98;
Counterclaim by
Fangda Construction
Technology Co., Ltd.
for payment of
outstanding contract
sums and other
Unresolved Major amounts totaling
Litigation/Arbitration RMB13,939,863.27
rectification, rework,
and repair costs arising
Jinan Kerry from quality issues
Integrated amounting to As of the date of this
Development RMB8,995,672.29; 2. report's disclosure, the
Project Scaffolding arbitration tribunal has
(Phase I and dismantling costs of issued a partial award on the
II) – RMB4,000; 3. Quality undisputed portion of the
Xiangheng Specialist inspection and testing counterclaim (requiring
March Property Fangda Construction Subcontract fees of Xiangheng Property to pay
Ltd. and Legal fees of interest in advance), and
Installation RMB690,000.00; Fangda Construction
of Aluminum Counter-arbitration Technology has applied for
Windows, claim by Fangda enforcement. The remaining
Louvers, and Construction issues in the case are under
Curtain Wall Technology Co., Ltd. consolidated hearing.
Systems for payment of contract
sums and related
expenses totaling
RMB18,062,462.28
China Fangda Group Co., Ltd. Notes to Financial Statements
Initiation Project Litigation/Arbitration Case Status as of
Case Type Plaintiff Defendant/Respondent
Date Involved Claims December 31, 2025
In February 2026, the court
of first instance ruled that
Chengdu Wenjiang Yufu
Wansheng Rail Transit
Urban Development Co.,
Chengdu Wenjiang sums and interest
Ltd. shall pay
Yufu Wansheng Rail totaling
RMB17,222,549.37 in
Transit Urban RMB17,238,120.44; 2.
contract sums and
Development Co., Ltd. Chengdu Joint and several
Fangda recognized Fangda
August and Chengdu Wenjiang liability borne by
Construction Construction Technology's
Technology priority right over the
Enterprise Management Project Enterprise
curtain wall works of the
Co., Ltd. (a Management Co., Ltd.;
tower and podium of the
single-shareholder 3. Assertion of priority
project. As of the date of
company) right over the project
this report's disclosure, the
proceeds
defendant has appealed
against the first-instance
judgment, and the case
remains under adjudication.
South China Payment of principal
International contract sums, interest,
South China
Electronic and other amounts
International Industrial
Fangda Industrial totaling As of the disclosure date of
August Materials City
Construction Raw RMB46,004,481.42, this report, the case is still
Technology Materials along with assertion of under trial.
and South China City
Logistics priority right over the
Holdings Limited
Zone (Phase construction project
I) Project proceeds.
Claim against Fangda
Shenzhen
Construction As of the disclosure date of
Jinshunyuan Jinshun
December Fangda Construction Technology Co., Ltd. this report, the court has
Industrial Mingju
Group Co., Project
for delay amounting to and is awaiting a hearing.
Ltd.
RMB9,250,070.
Payment of principal
contract sums and
interest totaling As of the disclosure date of
Fangda West
December Shanghai Lianhong RMB26,269,434.95, this report, the court has
Construction Hongqiao
Technology Project
priority right over the and is awaiting a hearing.
construction project
proceeds.
The court of first instance
ruled that Hongtao
of principal purchase purchase price of
price and interest RMB40,127,678.19 and
totaling overdue interest
RMB56,527,427.01; 2. (RMB8,418,135.54 as of
Counterclaim by June 30, 2022, with
Hongtao Company for subsequent interest
Shenzhen Hongtao Fangda Town
Major Litigation Not September Fangda rescission of the calculated at the LPR rate
Group Co., Ltd. Building No.
Yet Fully Enforced 2022 Property "Supplementary until full payment). The
(Hongtao Company) 3
Agreement on Real court dismissed all of
Estate Sale" and Hongtao Company's
payment of liquidated counterclaims. Both parties
damages for delayed appealed, and the appellate
title registration court upheld the original
amounting to judgment. As of the date of
RMB44,046,859.04 this report's disclosure, the
case has entered the
enforcement stage.
China Fangda Group Co., Ltd. Notes to Financial Statements
Initiation Project Litigation/Arbitration Case Status as of
Case Type Plaintiff Defendant/Respondent
Date Involved Claims December 31, 2025
The court of first instance
ruled that Kaidaer Company
shall pay the principal
contract sums and
construction contract;
corresponding interest, and
confirmed that Fangda
contract sums of
Fangda Guangzhou Kaidaer Kaidaer Hub Construction Technology
April RMB113,529,244.60
Construction Investment Co., Ltd. International Co., Ltd. holds a priority
Technology (Kaidaer Company) Plaza Project right over the discounted or
Assertion of priority
auction proceeds of the
right over the
project's curtain wall works.
construction project
As of the date of this
proceeds
report's disclosure, the case
has entered the enforcement
stage.
first instance ruled that
Logan Company shall pay
contract sums of
RMB7,709,679.55, quality
retention of
RMB6,033,911.38, and
corresponding interest, and
recognized Fangda
Construction Technology's
priority right over the
project proceeds. The
appellate court upheld the
original judgment and
additionally ruled that the
owner bears joint and
several liability for
Logan Construction
Logan repayment. The case has
Engineering Co., Ltd. Claim for payment of
Fangda Jiuzuan entered the enforcement
September and Shenzhen Logan principal contract sums
Construction Project – stage. 2. Parcel 09: The
Technology Parcel 05 and court of first instance ruled
Development Co., Ltd. RMB33,197,543.00
Parcel 09 that Logan Company shall
(Owner)
pay contract sums of
RMB9,166,924.08, quality
retention of
RMB4,875,762.96, and
corresponding interest, and
recognized Fangda
Construction Technology's
priority right over the
project proceeds. The
appellate court upheld the
original judgment and
additionally ruled that the
owner bears joint and
several liability for
repayment. The case has
entered the enforcement
stage.
China Fangda Group Co., Ltd. Notes to Financial Statements
Initiation Project Litigation/Arbitration Case Status as of
Case Type Plaintiff Defendant/Respondent
Date Involved Claims December 31, 2025
The court of first instance
ruled that Huilian Property
shall pay
RMB38,800,206.53 and
interest, and that Boneng
Industrial bears joint and
several liability for
RMB37,563,144.42 of that
sums and interest
Jiangxi Huilian amount and corresponding
Nanchang totaling
Fangda Property Co., Ltd. and interest. The court did not
November Shanglian RMB45,309,399.07; 2.
Construction Jiangxi Boneng support acceleration of the
Technology Industrial Group Co., quality retention or
Project right over the
Ltd. recognition of the priority
construction project
right. On appeal by Fangda
proceeds
Construction Technology,
the appellate court
recognized the priority
right. As of the date of this
report's disclosure, the case
has entered the enforcement
stage.
In August 2025, the court of
first instance ruled that
Suhao Company shall pay
RMB18,171,796.03 and
overdue interest (calculated
at 0.03% per day on a base
amount of
contract sums, interest, November 1, 2024;
and other amounts RMB110,000 already paid
Shenzhen Suhao Ziyuanyuan
Fangda totaling has been offset against
December Investment Co., Ltd. Building
Construction RMB18,600,899.46; 2. interest), Zhang Shengjie
Technology Assertion of priority bears joint and several
Zhang Shengjie Project
right over the liability, and Fangda
construction project Construction Technology's
proceeds priority right was
confirmed. In September
Technology applied for
enforcement. As of the date
of this report's disclosure,
the case is under
enforcement.
In January 2026, the court
of first instance ruled that
both defendants shall jointly
pay contract sums of
contract sums and
Zhejiang R&F Real RMB9,915,000 and interest,
interest totaling
Fangda Estate Development and confirmed the priority
August R&F Center RMB10,102,081.10; 2.
Construction Co., Ltd. and Hangzhou right. Neither party
Technology Lianfu Real Estate appealed, and the judgment
right over the
Development Co., Ltd. has taken effect. As of the
construction project
date of this report's
proceeds
disclosure, the case has
entered the enforcement
stage.
China Fangda Group Co., Ltd. Notes to Financial Statements
Initiation Project Litigation/Arbitration Case Status as of
Case Type Plaintiff Defendant/Respondent
Date Involved Claims December 31, 2025
In January 2025, the parties
reached a settlement, and
the court issued a judicial
confirmation order
(defendants to pay
RMB55,418,127.73, with
the legal representative
providing additional
personal guarantee). In May
Shenzhen Roland Sibao 2025, Fangda Construction
Property Development Technology applied for
Co., Ltd., Shenzhen enforcement due to
Hanking Group Co., Hanking defendants' breach of the
Claim for payment of
Fangda Ltd., Shenzhen Financial settlement terms. In July
March principal contract sums
Construction Hairunde Petrochemical Project and 2025, an enforcement
Technology Technology Co., Ltd., Hanking Era settlement was reached, but
RMB59,126,328.21
Wu Shaojie, and Huang Project the defendants breached
Jianwen (Legal again. In November 2025,
Representative and Fangda Construction
Guarantor) Technology re-applied for
enforcement (claiming
unpaid principal and interest
amounting to
RMB42,490,699.70). As of
the date of this report's
disclosure, the court has
accepted the case and
enforcement proceedings
are ongoing.
(2) Contingent liabilities and their financial impact arising from providing debt
guarantees for other entities.
By December 31, 2025, the Company has provided loan guarantees for the following
entities:
Name of guaranteed Amount (in
Guarantee Term
entity RMB10,000)
Guarantee and
Fangda Property 108,000.00 2025.04.02-2040.03.28
mortgage guarantee
Fangda Intelligent
Guarantee 28,000.00 2024.03.15-2030.03.14
Manufacturing
Fangda Construction
Guarantee 10,500.00 2025.03.19-2026.03.18
Technology
Fangda Construction
Guarantee 4,000.00 2025.03.21-2026.03.21
Technology
Fangda Construction
Guarantee 5,000.00 2025.06.17-2026.06.16
Technology
Fangda Construction
Guarantee 4,900.00 2025.05.23-2026.05.18
Technology
Fangda Construction
Guarantee 29,700.00 2024.06.26-2026.06.25
Technology
Fangda Construction Guarantee 4,000.00 2025.06.30-2026.06.17
China Fangda Group Co., Ltd. Notes to Financial Statements
Name of guaranteed Amount (in
Guarantee Term
entity RMB10,000)
Technology
Fangda Yunzhu Guarantee 600.00 2025.03.25-2026.03.24
Fangda Zhiyuan Guarantee 1,200.00 2025.03.31-2026.03.30
Fangda Zhiyuan Guarantee 4,000.00 2025.06.20-2026.06.19
Total 199,900.00
Note 1: Contingent liabilities caused by guarantees provided for other entities are all
related guarantees between interested entities in the Company.
Notes 2: The Company's property business provides periodic mortgage guarantee for
property purchasers. The term of the periodic guarantee lasts from the effectiveness of
guarantee contracts to the completion of mortgage registration and transfer of housing
ownership certificates to banks. As of December 31, 2025, the Company's outstanding
contingent guarantee liability related to the above matters amounted to RMB4,890,000.
(3) Other contingent liabilities and their influences
As of December 31, 2025, the Company has no significant contingencies that need to be
disclosed.
Status of Undischarged Guarantees as of December 31, 2025
Cash deposits as
Guarantee balance Utilized credit facilities
Currency security
(original currency) (Equivalent in RMB)
(Equivalent in RMB)
CNY 780,950,867.53 31,931.14 780,950,867.53
Hong Kong dollars (HKD) 22,259,665.45 15,000,000.00 20,105,375.03
United States dollars (USD) 5,739,305.43 1,962,466.66 38,377,963.35
SGD 18,396,338.00 100,418,250.61
AUD 14,124,550.00 66,232,839.86
EUR 1,257,254.67 10,354,120.83
Total 16,994,397.80 1,016,439,417.21
XIV. Post-balance-sheet events
On April 3, 2026, the sixteenth meeting of the tenth session of the Company's Board of
Directors deliberated and approved the full text and summary of the 2025 Annual Report and
China Fangda Group Co., Ltd. Notes to Financial Statements
the "2025 Profit Distribution Proposal." The Company will not distribute cash dividends,
issue bonus shares, or convert capital reserves into share capital for the year 2025.
The Company has no other issues in post balance sheet period that need to be disclosed
on April 03, 2026 (report date approved by the Board of Directors).
XV. Other material events
(1) Recognition basis and accounting policy for segment report
The Group divides its businesses into five reporting segments. The reporting segments
are determined based on financial information required by routine internal management. The
Company's management regularly evaluates the operating results of these reporting segments
to decide on the allocation of resources and to assess their performance.
The reporting segments are:
① Curtain wall division: production and sales of curtain wall materials, design,
production and installation of building curtain walls, curtain wall testing and maintenance
services;
② Rail transit branch: assembly and processing of subway screen doors, screen door
detection and maintenance services;
③ Real Estate Segment: Engaging in real estate development and operations, property
leasing, and property management services on land for which lawful use rights have been
obtained.
(4) New energy segment: photovoltaic power generation, photovoltaic power plant sales,
photovoltaic equipment R & D, installation, and sales, and photovoltaic power plant
engineering design and installation
(5) Others
The segment report information is disclosed based on the accounting policies and
measurement standards used by the segments when reporting to the management. The policies
and standards should be consistent with those used in preparing the financial statement.
China Fangda Group Co., Ltd. Notes to Financial Statements
(2) Segment profit or loss, assets and liabilities
December Curtain wall Rail transport Real estate New energy Others Offset Total
Turnover 2,582,489,536.60 596,770,482.60 185,100,036.04 19,396,434.57 22,995,999.62 29,449,422.99 3,377,303,066.44
Including:
external
transaction
income
Inter-segment
transaction 12,544,850.60 - 9,061,071.10 837,670.17 7,005,831.12 29,449,422.99
income
Including:
major
business
turnover
Operating
cost
Including:
major 2,395,869,372.69 414,437,641.54 54,017,532.42 7,968,831.22 8,267.66 16,340,264.57 2,855,961,380.96
business cost
Operation
cost
Operating
-354,595,284.46 100,616,909.97 -284,811,325.13 11,424,704.13 -9,777,921.16 73,343,982.28 -610,486,898.93
profit/(loss)
Total assets 6,880,323,000.07 977,857,042.55 5,751,277,252.87 130,227,209.06 3,493,828,343.18 4,658,112,779.98 12,575,400,067.75
Total
liabilities
(Continued)
December Curtain wall Rail transport Real estate New energy Others Offset Total
Turnover 3,561,702,648.49 612,820,581.01 230,469,222.06 19,026,115.66 22,532,419.32 22,326,788.83 4,424,224,197.71
Including:
external
transaction
income
Inter-segment
transaction 5,705,733.23 - 8,197,053.43 767,111.65 7,656,890.52 22,326,788.83
income
Including:
major
business
turnover
Operating
cost
Including:
major 3,047,951,367.08 438,554,056.89 61,531,185.13 8,032,304.65 81,137.33 10,755,162.77 3,545,394,888.31
business cost
Operation
cost
Operating
profit/(loss)
Total assets 7,532,568,590.72 1,032,310,791.63 6,175,077,185.56 135,707,679.69 3,854,072,616.26 5,174,349,638.65 13,555,387,225.21
Total
liabilities
(3) Others
① External revenue from principal products and services
Item 2025 2024
Metal production 2,549,499,511.03 3,506,046,473.56
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025 2024
Railroad industry 586,079,070.27 612,264,588.95
New energy industry 18,558,764.40 18,259,004.01
Real estate 175,882,686.80 236,549,368.23
Total 3,330,020,032.50 4,373,119,434.75
② Geographic breakdown of operating revenue
Item 2025 2024
In China 2,995,104,526.33 4,027,988,850.55
Out of China 382,198,540.11 396,235,347.16
Total 3,377,303,066.44 4,424,224,197.71
XVI. Notes to Financial Statements of the Parent
(1) Account age
Age December 31, 2025 December 31, 2024
Less than 1 year 5,278,640.77 2,857,394.06
Over 5 years 359,129.89
Subtotal 5,637,770.66 3,216,523.95
Less : Bad debt provision 411,916.30 331,398.60
Total 5,225,854.36 2,885,125.35
(2) Disclosure by bad debt accrual method
December 31, 2025
Type Remaining book value Bad debt provision
Proportion Provision Book value
Amount Amount
(%) rate %
Separate bad debt
provision
Provision for bad debts by
combination
Combination 3: Other
business models
Total 5,637,770.66 100.00 411,916.30 7.31 5,225,854.36
(Continued)
December 31, 2024
Type
Remaining book value Bad debt provision Book value
China Fangda Group Co., Ltd. Notes to Financial Statements
Proportion Provision
Amount Amount
(%) rate %
Separate bad debt
provision
Provision for bad debts by
combination
Combination 3: Other
business models
Total 3,216,523.95 100.00 331,398.60 10.30 2,885,125.35
Method of bad debt provision：
① Accounts receivable for which allowance for doubtful accounts is provided under
Portfolio 3: Other Category
December 31, 2025 December 31, 2024
Age Remaining Bad debt Providing Remaining Bad debt Providing
book value provision rate (%) book value provision rate (%)
Less than 1 year 5,278,640.77 52,786.41 1.00 2,857,394.06 20,858.98 0.73
Over 5 years 359,129.89 359,129.89 100.00
Total 5,637,770.66 411,916.30 7.31 3,216,523.95 331,398.60 10.30
Provision for bad debts by combination: 11.
(3) Changes in bad debt provision
Change in the period
December 31, December
Type Written-back Other
or recovered change
Portfolio 3.
Others
(4) No written-off account receivable during the report period
(5) Accounts receivable and contract assets with the top-5 ending balances, grouped by
party owed
The aggregate amount of the top five accounts receivable by debtor at period-end totaled
RMB5,282,959.37, representing 93.71% of the total accounts receivable balance, with a
corresponding aggregate allowance for doubtful accounts of RMB408,368.19.
(1) Classification of notes receivable
Item December 31, 2025 December 31, 2024
Other receivables 1,131,454,187.78 1,622,103,166.85
China Fangda Group Co., Ltd. Notes to Financial Statements
Item December 31, 2025 December 31, 2024
Total 1,131,454,187.78 1,622,103,166.85
(2) Other receivables
(1) Disclosure by age
Age December 31, 2025 December 31, 2024
Less than 1 year 3,425,432.76 53,408,271.79
Over 5 years 30,459,793.09 -
Subtotal 1,131,454,650.56 1,622,104,103.12
Less : Bad debt provision 462.78 936.27
Total 1,131,454,187.78 1,622,103,166.85
(2) Classification by nature of funds
By nature December 31, 2025 December 31, 2024
Accounts between related parties
within the scope of consolidation
Others 46,277.60 62,836.90
Subtotal 1,131,454,650.56 1,622,104,103.12
Less : Bad debt provision 462.78 936.27
Total 1,131,454,187.78 1,622,103,166.85
③ Method of bad debt Disclosed
A. The provision for bad debts as at Wednesday, December 31, 2025 is based on the
three-phase model as follows:
Step segment Remaining book value Bad debt provision Book value
First stage 1,131,454,650.56 462.78 1,131,454,187.78
Total 1,131,454,650.56 462.78 1,131,454,187.78
As at Wednesday, December 31, 2025, the first phase of the provision for bad debts:
Remaining book Providing Bad debt
Type Book value
value rate (%) provision
Separate bad debt provision
Provision for bad debts by
combination
Portfolio 3: deposit and margin
China Fangda Group Co., Ltd. Notes to Financial Statements
Remaining book Providing Bad debt
Type Book value
value rate (%) provision
receivable
Portfolio 7: Other receivables 46,277.60 1.00 462.78 45,814.82
Portfolio 6: related party funds
within the scope of 1,131,408,372.96 1,131,408,372.96
consolidation
Total 1,131,454,650.56 0.00 462.78 1,131,454,187.78
B. The provision for bad debts as at December 31, 2024 is based on the three-phase
model as follows:
Step segment Remaining book value Bad debt provision Book value
First stage 1,622,104,103.12 936.27 1,622,103,166.85
Total 1,622,104,103.12 936.27 1,622,103,166.85
As at Tuesday, December 31, 2024, the first phase of the provision for bad debts:
Remaining book Providing Bad debt
Type Book value
value rate (%) provision
Separate bad debt provision
Provision for bad debts by
combination
Portfolio 3: deposit and
margin receivable
Portfolio 7: Other receivables 62,836.90 1.49 936.27 61,900.63
Portfolio 6: related party funds
within the scope of 1,622,041,266.22 1,622,041,266.22
consolidation
Total 1,622,104,103.12 0.00 936.27 1,622,103,166.85
The amount of the bad debt provision is Basis：
Provision for bad debts by combination: 11.
④ Changes in bad debt provision
Change in the period
December 31, December
Type Written-back or Other
recovered change
Other
receivables
and bad debt
provision
Total 936.27 -473.49 462.78
⑥ Balance of top 5 other receivables at the end of the period
China Fangda Group Co., Ltd. Notes to Financial Statements
Balance on
Wednesday, Bad debt
Entity By nature Age Percentage (%)
December 31, provision
Less than
Shenzhen 1 year
Related party
Fangda 12,706,314.89 1-2 years
funds within the
Property 615,478,380.00 2-3 years 82.16
scope of
Development
consolidation 72,577,980.00 3-4 years
Co., Ltd.
Fangda 40,639,120.00 1-2 years
Related party
(Jiangxi) 17,500,000.00 2-3 years
funds within the
Property 15.15
scope of 20,000,000.00 3-4 years
Development
consolidation 93,258,284.79 4-5 years
Co., Ltd.
Shihui Related party
International funds within the Over 5
Holding Co., scope of years
Ltd. consolidation
Housing Non-related Less than
provident fund parties 1 year
Social
Non-related Less than
insurance 20,070.95 0.00 200.71
parties 1 year
contributions
Total 1,131,451,754.91 100.00 433.82
(1) Long-term share equity investment
December 31, 2025 December 31, 2024
Item Remaining book Impairmen Remaining book Impairmen
Book value Book value
value t provision value t provision
Investment
in 1,706,562,530.0 1,706,562,530.0 1,657,062,530.0 1,657,062,530.0
subsidiarie 0 0 0 0
s
(2) Investment in subsidiaries
December 31, 2024 Change (+,-) December 31, 2025
Balan Balan
ce of Decre Impair ce of
Invested
impai Increased ased ment Oth impair
entity Book value Book value
rment investment invest provisi ers ment
provi ment on provis
sion ion
Fangda
Construction 751,950,000.00 751,950,000.00
Technology
Fangda
Jiangxi New 74,496,600.00 74,496,600.00
Material
Fangda
Property
China Fangda Group Co., Ltd. Notes to Financial Statements
December 31, 2024 Change (+,-) December 31, 2025
Balan Balan
ce of Decre Impair ce of
Invested
impai Increased ased ment Oth impair
entity Book value Book value
rment investment invest provisi ers ment
provi ment on provis
sion ion
Shihui
International
Fangda New
Energy
Fangda
Investment
Holding
Company
Fangda
Intelligent
Manufacturin
g
Fangda
Zhiyuan
Total 1,657,062,530.00 49,500,000.00 1,706,562,530.00
Item
Income Cost Income Cost
Main business 22,995,999.62 8,267.66 22,532,419.32 81,137.33
Total 22,995,999.62 8,267.66 22,532,419.32 81,137.33
Item 2025 2024
Dividends distributed by subsidiaries 25,500,000.00 72,929,550.62
Investment income of trading financial assets during
obtained the holding period
Total 25,676,162.22 72,929,550.62
XVII. Supplementary Materials
Item 2025
Non-current asset disposal gain/loss (including the write-off part for which assets
-3,032,277.77
impairment provision is made)
Government grants recognized in the current period's profit or loss (except for
government grants that are closely related to the Company's normal business
operations, in line with national policies and in accordance with defined criteria, and
have a continuous impact on the Company's profit or loss)
Gains and losses from changes in the fair value of financial assets and liabilities held
by non-financial corporations and gains and losses from the disposal of financial assets
and liabilities, except for effective hedging operations related to the Company's normal
business operations
China Fangda Group Co., Ltd. Notes to Financial Statements
Item 2025
One-time expenses incurred by the enterprise due to the discontinuation of related
-1,145,361.48
business activities, such as expenditures for employee placement.
Gain/loss from change of fair value of investment property measured at fair value in
-280,731,968.67
follow-up measurement
Other non-business income and expenditures other than the above -17,778,105.99
Other gain/loss items satisfying the definition of non-recurring gain/loss account
Total non-recurring gain and loss -294,114,405.01
Less: Influence of non-recurring gain and loss on income tax -73,720,330.38
Net non-recurring gain and loss -220,394,074.63
Less: Net non recurring profit and loss attributable to minority shareholders -38.58
Net non recurring profit and loss attributable to common shareholders of the company -220,394,036.05
① 2025
Weighted average Earning per share
Profit of the report period net income/asset Basic earnings per Diluted earnings
ratio (%) share per share
Net profit attributable to common
-8.75 -0.48 -0.48
shareholders of the Company
Net profit attributable to the common
owners of the PLC after deducting of -4.98 -0.27 -0.27
non-recurring gains/losses
② 2024
Weighted average Earning per share
Profit of the report period net income/asset Basic earnings per Diluted earnings
ratio (%) share per share
Net profit attributable to common
shareholders of the Company
Net profit attributable to the common
owners of the PLC after deducting of
China Fangda Group Co., Ltd. Notes to Financial Statements
Weighted average Earning per share
Profit of the report period net income/asset Basic earnings per Diluted earnings
ratio (%) share per share
non-recurring gains/losses
Company's name: China Fangda Group Co., Ltd.
Date: April 03, 2026
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