important notice - 广东科达洁能股份有限公司- · important notice i. board of directors,...
TRANSCRIPT
Important Notice
I. The Board of Directors, the Board of Supervisors, the Supervisors and Senior Management ensure that contents
of the annual report are authentic, accurate and complete, and do not contain any false statement, misleading
statement or significant omissions, and bear individual and joint and several legal liabilities.
II. All directors of the Company attended conference of the Board of Directors.
III. Zhongxi CPA Firm (special general partnership) provides the Company with standard audit report without
reservations.
IV. The Principal of the Company Wu Muhai, the principal in charge of accounting Zeng Fei and the principal of
accounting body (accounting manager) Zeng Fei declare that: ensure that financial report of the annual report is
authentic, accurate and complete.
V. Proposals of profit distribution or increased share capital by public reserve fund transfer in the reporting period
reviewed and discussed by the Board of Directors
The proposal of profit distribution for the year 2015 is described as follows: the Company’s total number of shares
705,732,161 as the base number, cash 2.00 yuan (tax included) is allocated to all shareholders for each 10 shares,
and cash dividend of 141,146,432.20 yuan is allocated. Meanwhile, 10 shares are increased for each 10 shares to
all shares by transferring public reserve fund, and the share number to be increased is 705,732,161. The proposal
comes into force upon being reviewed and passed by the Shareholders’ Conference.
VI. Declaration on risks in forward-looking statement
The annual report includes future plan and other forward-looking statement, and does not constitute substantial
commitment to investors by the Company. The investors are encourages to focus on investment risks.
VII. Any fund occupied by controlling shareholders and its related parties not for business?
No
VIII. Any external guarantee provided in violation of decision-making procedures?
No
IX. Significant risk disclosure
In this annual report, the Company details risks that the Company may challenge. Please refer to Section V of the
Annual Report “the Management’s Analysis and Discussion”.
The Annual Report is prepared in Chinese and English .In case of discrepancy,the Chinese version will prevail.
Table of Contents
Section I Definitions ......................................................................................... 1
Section II Company Profile ............................................................................... 2
Section III Main Financial Indexes ...................................................................... 12
Section IV Profile of company business ............................................................. 15
Section V The Management’s Discussion and Analysis ..................................... 16
Section VI Important Notice ............................................................................... 26
Section VII Change of ordinary shares and details of shareholders ..................... 28
Section VIII Details of directors, supervisors, senior management and staff ......... 31
Section IX Financial Report ................................................................................ 33
I. The Management’s responsibility for financial statements ............ 33
II. CPA’s responsibilities .................................................................. 34
III. Audit opinions ............................................................................. 47
Section I Definitions
1Annual Report 2015
I. Definitions
In the report, unless otherwise specified, the following terms are defined as follows:
Definitions of usually used terms
Company, the Company, KEDA
Clean Energy Refers to KEDA Clean Energy Co., Ltd.
Shunde Ceramics Machinery Refers to Shunde KEDA Ceramic Machinery Co., Ltd.
KEDA (Anhui) Industrial Refers to KEDA (Anhui) Industrial Co., Ltd.
KEDA (Anhui) Clean Energy Refers to KEDA (Anhui) Clean Energy Co., Ltd.
KEDA Stone Refers to Foshan KEDA Stone Machinery Co., Ltd.
KEDA Hong Kong Refers to KEDA Industrial (Hong Kong) Limited
Henglitai Company Refers to Foshan Henglitai Machinery Co., Ltd.
Suremaker Company Refers to Wuhu Suremaker Machinery Co., Ltd., Wuhu KEDA Suremaker
Co., Ltd.
KEDA Hydraulics Refers to Foshan KEDA Hydraulic Machinery Co., Ltd.
Xincheng Investment, Anhui
Xincheng Investment Refers to Anhui Xincheng Investment Co., Ltd.
Anhui Xincheng Financing Refers to Anhui Xincheng Financing and Leasing Co., Ltd.
Guangdong Xincheng Financing Refers to Guangdong Xincheng Financing and Leasing Co., Ltd.
Xincheng International Refers to Xincheng International Financing and Leasing Co., Ltd.
Tianjiang Pharmaceutical Refers to Jiangyin Tianjiang Pharmaceutical Co., Ltd.
Changsha Aer Refers to Changsha Aer Compressor Co., Ltd.
Anhui Aer Refers to Anhui KEDA Aer Compressor Co., Ltd.
Guangdong Taiwei Refers to Guangdong Taiwei Digital Ceramics Printing Co., Ltd.
KEDA Dongda Refers toHenan Dongda Tailong Metallurgy Science& Technology Co.,
Ltd., Henan KEDA Dongda International Engineering Co., Ltd.
Dongda Science & Technology Refers toNortheast University Science & Technology Industrial Group
Co., Ltd.
KEDA (Shenyang) Clean Energy Refers to KEDA (Shenyang) Clean Energy Gas Co., Ltd.
Suremaker Engineering Co., Ltd. Refers to KEDA (Maanshan) Suremaker Engineering Co., Ltd.
Do Better Company Refers to Foshan Do Better Machinery Co., Ltd.
Jiangsu Kehang Refers toJiangsu Kehang Environmental Protection Science& Technology
Co., Ltd.
Ningxia Kehang Refers to Ningxia Kehang Environmental Protection Engineering Co., Ltd.
KEDA Clean Energy New Materials Refers to Anhui KEDA Clean Energy New Materials Co., Ltd.
Zhangzhou Juming Refers to Zhangzhou Juming Graphite Co., Ltd.
SRC, CSRC Refers to China Securities Regulatory Commission
Zhongxi CPA Firm Refers to Zhongxi CPA Firm (Special Ordinary Partnership)
Phase-II stock option incentive Refers to Phase-II Stock Option Incentive Plan of KEDA Clean Energy
Co., Ltd.
yuan, 10 thousand yuan, 100 million
yuan Refers to RMB yuan, RMB 10 thousand yuan, RMB 100 million yuan
1Annual Report 2015
Section III Main Financial IndexesSection III Main Financial Indexes
Annual Report 2015 13Annual Report 201512
I. Corporate Information
Company name in Chinese 广东科达洁能股份有限公司Abbreviated company name in Chinese 科达洁能Company name in foreign language Keda Clean Energy Co., Ltd.
Abbreviated company name in foreign language KEDA
Company’s legal representative Wu Muhai
II. Contact and liaison
Secretary of the Board of Directors Representative of securities
Name Zhu Yafeng Feng Xin
Liaison address
No.1, West Huanzhen Road, Guanglong
Industrial Park, Chencun Town, Shunde
District, Foshan City, Guangdong Province
No.1, West Huanzhen Road, Guanglong
Industrial Park, Chencun Town, Shunde
District, Foshan City, Guangdong Province
Tel +86-757-23833869 +86-757-23833869
Fax +86-757-23833869 +86-757-23833869
Email [email protected] [email protected]
III. Basic information
The Company’s registered address
No.1, West Huanzhen Road, Guanglong Industrial Park,
Chencun Town, Shunde District, Foshan City, Guangdong
Province
Postal code of the Company’s registered address 528313
The Company’s office address
No.1, West Huanzhen Road, Guanglong Industrial Park,
Chencun Town, Shunde District, Foshan City, Guangdong
Province
Postal code of the Company’s office address 528313
The Company’s website http: //www.kedachina.com.cn
Email [email protected]
IV. Information disclosure and placement location
Media for information disclosure appointed by the
Company Shanghai Securities News, Securities Times
Website of China Securities Regulatory Commission for
publishing annual report www.sse.com.cn
Placement location for the Company’s annual report The Company, Shanghai Stock Exchange
V. Information of company stock
Information of Company Stock
Type of stock Listing stock exchange Abbreviated stock
name Stock code
Abbreviated name of
stock before change
Share A Shanghai Stock Exchange KEDA Clean Energy 600499 KEDA Industrial
VI. Other related information
CPA Firm engaged
by the Company
(domestic)
Name Zhongxi CPA Firm (special general partnership)
Office address 11F, Block A, Xincheng Wenhua Mansion, No.11,
Chongwenmenwai Street, Beijing City
Names of signing CPA Wang Huishuan, Su Zhijun
Financial consultant
exercising supervision
duties in the reporting
period
Name Southwest Securities Co., Ltd.
Office address 4F, Block A, International Enterprise Mansion, No.35,
Financial Street, Xicheng District, Beijing City
Names of signing financial
consultants Tong Xing, Wang Xi
Supervision period January 13, 2014 to December 31, 2015
VII. Main accounting data and financial indexes in the last 3 years
(I) Main accounting data Unit: 10 thousand yuan, Currency: RMB
Main accounting data Year 2015 Year 2014
Increment or
decrement
compared with the
same period last
year (%)
Year 2013
Business revenue 359,368.43 446,587.59 -19.53 381,189.64
Net profit attributed to shareholders of listing
company 54,131.76 44,610.47 21.34 37,020.62
Net profit attributed to shareholders of listing
companies after recurring profits and losses
deducted
400.49 40,490.09 -99.01 34,571.89
Net cash amount from business activities 56,493.88 -28,425.79 298.74 294.23
The end of
year 2015
The end of
year 2014
Increment or
decrement
compared with the
same period of the
last year (%)
The end of
year 2013
Net assets attributed to shareholders of listing
companies 410,826.93 361,527.56 13.64 287,934.04
Total assets 842,057.19 757,676.84 11.14 642,650.29
Total share capital at the end of the period 70,573.22 69,722.72 1.22 66,624.87
Section III Main Financial Indexes
Annual Report 201514
(II) Main financial indexes
Main financial indexes Year 2015 Year 2014
Increment or decrement
compared with the same
period of the last year (%)
Year 2013
Basic earnings per share (yuan/share) 0.771 0.647 19.17 0.560
Diluted earnings per share (yuan/share) 0.771 0.638 20.85 0.552
Basic earnings per share after non-recurring
profits and losses deducted (yuan/share) 0.006 0.587 -98.98 0.523
Weighted average net asset yield (%) 14.04 13.28 Increasing by 0.76% 13.89
Weighted average net asset yield after non-
recurring profits and losses deducted (%) 0.10 12.05 -11.95 12.97
Description of main accounting data and financial indexes 3 years before the end of the reporting period
During the reporting period, the Company accrued bad debt provision of 133.7063 million yuan, goodwill
depreciation provision of 65.4079 million yuan and disposed of fixed assets of 56.4011 million yuan, and net profit
attributed to shareholders of listing company after recurring profits and losses is decreased significantly compared with
the same period of the last year.
VIII. Main financial data of the year 2015 in quarters Unit: 10 thousand yuan, currency: RMB
1st quarter
(January to
March)
2nd quarter
(April to June)
3rd quarter
(July to
September)
4th quarter
(October to
December)
Business revenue 103,541.79 107,694.64 69,189.82 78,942.18
Net profit attributed to shareholders of listing
company 13,213.97 13,721.46 33,545.58 -6,349.25
Net profit attributed to shareholders of listing
company after recurring profits and losses deducted 11,729.46 11,608.46 2,062.17 -24,999.60
Net cash amount from business activities 7,108.49 23,122.69 18,669.52 7,593.18
Section IV Profile of company business
15Annual Report 2015
I. Description of main business, operating mode and industrial details of the Company during the reporting
period
The Company main business includes building material machinery, clean energy etc.
1. Building material machinery includes ceramics machinery, bricks machinery, stone machinery etc.
Since foundation, the Company researched and developed the first ceramics squaring & chamfering machine,
calibrating machine, polishing machine, polishing tile production line, large-tonnage press etc. in China, and boosted
the process of domestic ceramics machinery replacement of imported equipment from Italy. At present, the imported
ceramics machinery market share in China is less than 10%, and the Company’s ceramics machinery market share
is more than 30% of domestic market. Of which, market share of press and polishing machine are more than 80%.
Meanwhile, the Company is the first AAC slab equipment supplier in China, and one of several companies master key
technology of solid stone waste utilization in the world, with outstanding competitive strength.
The Company’s building material machinery business is independently operated by several operating units. At
present, there are 14 sales zones in China, 4 sales zones overseas and 2 overseas subsidiaries, implement marketing
with the sales mode including domestic direct sales, overseas “direct sales+ agency”, “joint venture for plant+ complete
plant sales”, and the operating mode of “production subject to sales”, and expand the overseas market with help of
financing and leasing companies.
2. The clean energy business includes clean coal gasification, fume control, manufacturing and engineering
business etc.
With the clean coal gasification system, the Company provides customers with the competitive coal-based clean
coal gas solutions. At present, in the domestic industrial fuel field, the solid bed coal gas generator with low conversion
efficiency and serious exhaust gas is still used. However, with intensified environmental protection supervision and new
technology, the Company sees sustainable market demand growth. Nowadays, the Company’s clean coal gasification
system is promoted in the aluminum oxide industry and is expanded towards ceramics, carbon, coking, special steel
and other fields. The Company’s fume control meets low-emission requirements of thermal power industry, and is
advantageous in building material and other industrial fields, and will be benefited from pollutant control from thermal
power to industrial fields.
The Company’s clean energy environmental protection business is operated by direct sales and bidding. The
production and operation mode of “production subject to sales, and purchasing subject to production” is adopted, and
the shareholding companies with EPC qualification are in charge of designing and contracting, and the financial services
from financing and leasing companies provide customers with complete solutions.
II. Analysis of core competitive strength in the reporting period
1. Strategic positioning of the conventional advantageous industry follows up the trend of times
During the reporting period, in terms of the Company’s advantageous building material machinery business, with
the help of incentive policy “The Belt, and The Road” by the central government, the Company reinforces overall overseas
sales and service, initiates the “overseas joint venture for plant+ complete plant sales” for areas with poor marketing, and
accelerates construction of complete production line as modal and drives model effects. During the reporting period, the
Company signs contracts with African countries on building ceramics producers by joint venture, marking that milestone
progress made for African market as the first access market.
2. New clean energy and environmental protection business reinforces business collaboration and
integration
During the reporting period, the Company integrated Jiangsu Kehang Environmental Protection Science & Technology
Co., Ltd. to advance the “front-end clean production+ back-end control” collaboration effect and cross sales for industrial
enterprises. At present, the Company is capable of providing customers with complete solutions involving EPC engineering
design, production and installation, general contracting and financing and leasing for environmental protection control;
meanwhile, through effective resource sharing and complementary advantages of operators, the Company establishes a
business system with clear labor division and closely collaborated, and the integration advantages are evident.
Section V The Management’s Discussion and AnalysisSection V The Management’s Discussion and Analysis
Annual Report 2015 17Annual Report 201516
I. The Management’s discussion and analysis
In the year 2015, the world’s economic environment is complicated, and domestic economic growth is feeble. In
the lower-reaches industry of the Company, operation rate of domestic building material and ceramics enterprises was
dropped to 70%, and prices of aluminum oxide was decreased significantly. The Company’s major business challenged
serious domestic economic situations, and total annual performance is lower than the objective determined at the
beginning of the year.
During the reporting period, the Company sold the equity of Tianjiang Pharmaceutics, recovered fund and created
slack financial environment for focusing on “green solution, greener life”; based on principles of stability and prudence,
partial asset depreciation reserves were written off and accrued in the year, and the Company’s overall asset quality was
improved; in terms of key business, business volume and expansion of ceramics machinery made progress; in terms of
clean energy, the clean coal gasification technology passed national achievement appraisal by the Ministry of Industry
and Information of China, and first set of low-pressure powder coal gas fluid bed gasifier put into service; through
integrating Jiangsu Kehang Environmental Protection, the collaboration of “front-end clean production+ back-end control”
for industrial enterprises was shaped; in terms of the Company’s internal risk control and internal management, the
Company established office of the Board of Directors to reinforce process control over the holding subsidiaries and lower
management risks.
II. Major business in the reporting period
During the reporting period, the Company attained major business revenue of 3593.6843 million yuan, a drop
of 19.53% compared with the same period of the last year, and attained overseas business income of 737.6058
million yuan, increasing by 32.16% compared with the same period of the last year. The Company sold 9.67% equity
of Jiangyin Tianjiang Pharmaceutical at the price of 924.1460 million yuan, and realized profit of 654.4674 million
yuan in the reporting period, increasing by 42.54% compared with the same period of the last year; the Company
realized net profit of 531.7890 million yuan, increasing by 24.19% compared with the same period last year; and
net profit attributed to the parent company is 541.3176 million yuan, increasing by 21.34% compared with the same
period of the last year.
(I) Analysis of major business
Analysis of Change of Items in Profit Statement and Cash Flow Statement Unit: 10 thousand yuan, currency: RMB
Description Amount of the
period
Amount of the same
period last year
Ratio of
change (%)
Business revenue 359,368.43 446,587.59 -19.53
Business cost 277,606.24 340,371.70 -18.44
Sales expenses 20,740.26 20,823.19 -0.40
Overhead 40,668.12 35,689.21 13.95
Financial costs 2,969.23 2,416.64 22.87
Net cash amount from business activities 56,493.88 -28,425.79 298.74
Net cash amount from investment activities 76,616.69 -31,628.21 342.24
Net cash amount from fund raising activities -101,246.06 42,912.12 -335.94
R & D expenditures 16,700.05 18,313.40 -8.81
1. Analysis of revenue and cost
(1).Major business subject to industry, product and area Unit: 10 thousand yuan, currency: RMB
Details of major business subject to product
Subject to product Business
revenue
Business
cost
Gross
profit rate
(%)
Business
revenue
increased or
decreased
compared with
the last year (%)
Business cost
increased or
decreased
compared with
the last year
(%)
Gross profit
rate increased
or decreased
compared with
the last year
(%)
Building material machinery 244,902.59 190,437.38 22.24 -29.29 -26.62Decreased by
2.83%
Clean energy equipment 84,903.60 60,345.63 28.92 24.70 23.70Increased by
0.57%
Clean energy service 10,721.02 20,115.39 -87.63 -5.08 -15.54Increased by
23.24%
Financing and leasing 15,565.20 4,250.06 72.70 -6.40 -22.62Increased by
5.72%
Other equipment 2,789.18 2,044.34 26.70 -29.65 -23.08Decreased by
6.26%
Major business subject to areas
Subject to area Business
revenue
Business
costs
Gross
profit rate
(%)
Business
revenue
increased or
decreased
compared with
the last year (%)
Business cost
increased or
decreased
compared with
the last year
(%)
Gross profit
rate increased
or decreased
compared with
the last year
(%)
Domestic 285,121.01 225,020.62 21.08 -26.99 -25.33Decreased by
1.76%
Overseas 73,760.58 52,172.18 29.27 32.16 33.99Decreased by
0.96%
Description of major business subject to industry, product and area (1) Analysis of factors driving change of business revenue 1. In the year 2015, the building material machinery business attained business revenue of 2.449 billion yuan, a drop
of 29.29%, mainly caused by feeble ceramics industry, and poor demanding on building material machinery in China. 2. In the year 2015, the clean and environmental protection products attained business revenue of 849 million
yuan, increasing by 24.70% compared with the same period of the last year, mainly caused by merging Jiangsu Kehang
Environmental Protection Science& Technology Co., Ltd.
Section V The Management’s Discussion and AnalysisSection V The Management’s Discussion and Analysis
Annual Report 2015 19Annual Report 201518
3. In the year 2015, the financing and
leasing business attained business revenue of
156 million yuan, a drop of 6.40% compared
with the same period of the last year.
4. In the year 2015, the clean energy
service attained business revenue of 107
million yuan, a drop of 5.08% compared with
the same period of the last year.
(2) Analysis on influences of new
products and new business
In August, 2015, the Company acquired
72% equity of Kehang Environmental
Protection. The Company’s business
expanded to smoke control. During the
reporting period, consolidated statement
revenue of Kehang Environmental Protection was 211 million yuan.
(3) Information of main customers
Sales of the Company’s top five customers is 623.4293 million yuan (tax excluded), accounting for 17.35% of total
sales revenue.
(2). Analysis of production and sales volumes
Major products Unit Production
volume
Sales
volume Stock
Production
volume
compared with
the last year (%)
Sales volume
increased or
decreased compared
with the last year (%)
Stock increased
or decreased
compared with
the last year (%)
Press Set 411 424 174 -34.66 -33.65 -6.95
Polishing line PCS 347 348 12 19.66 21.25 7.69
Kiln Set 29 29 31.82 31.82
AAC production line Set 14 15 5 -61.11 -57.14 -16.66
Description of production and sales
For the Company’s business beyond building material machinery is various and models are quietly different, the
production and sales volumes cannot be used to identify.
(3). Form of cost analysis Currency: RMB Unit: 10 thousand yuan
Details subject to products
Subject to
products Direct compositions
Amount in
the period
Ratio of
total cost in
the period
(%)
Amount in the
same period
of the last
period
Rate of total
cost in the
same period
of the last year
(%)
Rate of change
of amount
compared with
the last period
(%)
Remarks
Building material
machinery
Direct material cost 161,548.03 84.83 223,110.09 85.97 -27.59
Direct labor costs 7,660.62 4.02 8,258.59 3.18 -7.24
Manufacturing costs 17,712.93 9.30 24,020.51 9.26 -26.26
Depreciation 3,515.80 1.85 4,139.76 1.60 -15.07
Subtotal 190,437.38 100.00 259,528.95 100.00 -26.62
Clean energy
equipment
Direct material cost 51,257.88 84.94 40,298.42 82.61 27.20
Direct labor costs 1,827.04 3.03 1,825.52 3.74 0.08
Manufacturing costs 6,523.22 10.81 5,803.74 11.90 12.40
Depreciation 737.49 1.22 855.78 1.75 -13.82
Subtotal 60,345.63 100.00 48,783.46 100.00 23.70
Details subject to products
Subject to
products Direct compositions
Amount in
the period
Ratio of
total cost in
the period
(%)
Amount in the
same period
of the last
period
Rate of total
cost in the
same period
of the last year
(%)
Rate of change
of amount
compared with
the last period
(%)
Remarks
Clean energy
service
Direct material cost 9,607.76 47.76 15,701.03 65.92 -38.81
Direct labor costs 567.65 2.82 709.24 2.98 -19.96
Manufacturing costs 4,952.14 24.62 4,282.67 17.98 15.63
Depreciation 4,987.84 24.80 3,123.92 13.12 59.67
Subtotal 20,115.39 100.00 23,816.86 100.00 -15.54
Miscellaneous
Direct material cost 988.68 48.36 1,259.63 47.39 -21.51
Direct labor costs 465.07 22.75 494.84 18.62 -6.02
Manufacturing costs 471.22 23.05 768.50 28.92 -38.68
Depreciation 119.36 5.84 134.79 5.07 -11.45
Subtotal 2,044.33 100.00 2,657.76 100.00 -23.08
Financing and
leasing Interest 4,250.06 100.00 5,492.38 100.00 -22.62
2. Costs Unit: 10 thousand yuan
Description Year 2015 Year 2014 Increased or decreased by %
Sales cost 20,740.26 20,823.19 -0.40
Overhead 40,668.12 35,689.21 13.95
Financial costs 2,969.23 2,416.64 22.87
3. R & D expenses Details of R & D expenses
Unit: 10 thousand yuan
Expenditure R & D expenses in the period 16,700.05
Capitalized R & D expenditures in the period 0
R & D expenditures in total 16,700.05
Ratio of total R & D expenditure to total revenue (%) 4.65
Quantity of R & D staff of the Company 682
Ratio of R & D staff to total number of company staff (%) 14.78
Ratio of R & D expenses capitalization (%) 0
Section V The Management’s Discussion and AnalysisSection V The Management’s Discussion and Analysis
Annual Report 2015 21Annual Report 201520
4. Cash flowUnit: 10 thousand yuan, currency: RMB
Year 2015 Year 2014Increment or
decrement Increased or
decreased by %
Refunding of tax received 6,007.72 2,893.96 3,113.77 107.60
Other cash received related to business activities 20,029.58 5,050.93 14,978.65 296.55
Cash received from recovering investment 93,137.83 0 93,137.83
Net cash amount recovered from disposal of fixed assets, intangible assets and other long-term assets
187.54 10.21 177.33 1,737.61
Other cash received related to investment activities 10,700.00 0 10,700.00
Net cash amount paid by subsidiaries and other business organizations
15,920.92 8,034.20 7,886.72 98.16
Cash received from absorbing investment 9,985.22 19,321.24 -9,336.02 -48.32
Other cash received related to fund raising activities
18,964.33 11,451.31 7,513.01 65.61
Cash received from repaying debts 288,666.14 122,570.41 166,095.73 135.51
(1) The received tax refunding is increased by 107.60% compared with the same period of the last year, mainly caused by tax rebating received in the period.
(2) Other cash received related to business activities is increased by 296.55% compared with the same period of the last year, mainly caused by sharp increase of government subsidy received, and Jiangsu Kehang received accounts of 60.70 million yuan from Jiangsu Kehang Environmental Protection Group Co., Ltd. and Ningxia Kehang received accounts of 20 million yuan from Jiangsu Kehang Environmental Protection Group Co., Ltd.
(3) Cash received from recovering investment is 931.3783 million yuan, mainly caused by receiving the equity transferring amount of Tianjiang Pharmaceutical 924.1460 million yuan.
(4) Net cash amount received from disposing of fixed assets, intangible assets and other long-term assets is increased by 1,737.61% compared with the same period of the last year, mainly caused by more cash received from disposal of fixed assets in the period.
(5) Other cash received related to investment is 107.00 million yuan, and is from redemption of the Company’s bank financing products.
(6) Cash received from payment by subsidiaries and other operators is 159.2092 million yuan, the net cash amount paid for acquiring Jiangsu Kehang Environmental Protection Science& Technology is 151.3730 million yuan, and the net cash amount paid for acquiring Zhangzhou Juming Graphite Co., Ltd. is 7.8362 million yuan.
(7) Cash received from absorbing investment is 99.8522 million yuan, 80.2022 million yuan of which is the contribution by the staff exercising rights from phase-II stock option incentive; 10 million yuan of which is minor shareholders’ amount for increasing capital from Do Better Company; and 9.15 million yuan of which is minor shareholders’ amount for increasing capital received from KEDA Hydraulics.
(8) Other cash received related to raising activities is increased by 65.61% compared with the same period last year, mainly caused sharp increasing of security recovered and redemption of fixed deposit.
(9) Cash paid for debt is increased by 135.51% compared with the same period of the last year, mainly caused by the Company’s repaying bank loan more than other periods.
(II) Description of significant profit changes by non-major business
√ Applicable □ Not applicable
In October, 2015, for the Company sold 9.6732% equity of Tianjiang Pharmaceutical to China TCM Co., Ltd., the
investment earnings 664.1776 million yuan was confirmed, and net profit of 529.5926 million yuan was increased in the
period after the income tax was deducted.
(III) Analysis of assets and liabilities
Information of assets and liabilities Unit: 10 thousand yuan
Item
Amount at
the end of
the period
Ratio of amount
at the end of
the period to
total assets (%)
Amount
at the end
of the last
period
Ratio of
amount at the
end of the last
period to total
assets (%)
Ratio of amount at
the end of the period
compared with that
at the end of the last
period (%)
Monetary fund 72,904.49 8.66 34,787.72 4.59 109.57
Notes receivable 14,748.97 1.75 13,162.61 1.74 12.05
Accounts receivable 110,482.34 13.12 75,403.41 9.95 46.52
Accounts prepaid 21,048.65 2.50 12,812.80 1.69 64.28
Other receivables 13,597.39 1.61 3,865.37 0.51 251.77
Stock 131,117.17 15.57 121,255.32 16.00 8.13
Non-current assets due in one year 113,634.10 13.49 127,900.22 16.88 -11.15
Other current assets 13,931.47 1.65 23,213.31 3.06 -39.99
Long-term accounts receivales 38,042.85 4.52 46,900.05 6.19 -18.89
Long-term equity investment 50.45 0.01 21,814.76 2.88 -99.77
Fixed assets 190,833.51 22.66 163,705.38 21.61 16.57
Projects under construction 6,193.31 0.74 12,192.40 1.61 -49.20
Intangible assets 44,750.73 5.31 33,524.11 4.42 33.49
Goodwill 64,827.57 7.70 63,808.68 8.42 1.60
Deferred income tax assets 5,894.19 0.70 3,330.69 0.44 76.97
Total assets 842,057.19 100.00 757,676.84 100.00 11.14
Short-term loan 35,375.53 8.77 80,663.44 21.60 -56.14
Notes payable 43,018.41 10.67 37,380.88 10.01 15.08
Accounts payable 137,724.84 34.15 85,052.62 22.78 61.93
Accounts pre-received 68,150.81 16.90 56,955.07 15.25 19.66
Payroll payable 7,397.82 1.83 6,752.04 1.81 9.56
Tax payable 12,548.48 3.11 4,625.19 1.24 171.31
Other accounts payable 8,781.14 2.18 3,383.56 0.91 159.52
Non-current liabilities due in 1 year 24,659.74 6.11 58,911.26 15.78 -58.14
Other current liabilities 10,599.00 2.63
Long-term loan 36,621.31 9.08 27,864.48 7.46 31.43
Estimated liabilities 101.66 0.03 133.70 0.04 -23.97
Deferred income 6,940.50 1.72 3,095.00 0.83 124.25
Deferred income tax liabilities 2,127.97 0.53 1,129.54 0.30 88.39
Other non-current liabilities 9,235.57 2.29 7,440.92 1.99 24.12
Liabilities in total 403,282.78 100.00 373,387.71 100.00 5.67
Notes:
(1) Receivable at the end of the period is increased by 46.52% compared with that at the beginning of the period,
mainly caused by merging Jiangsu Kehang.
(2) Amount of pre-paid accounts at the end of the period is increased by 64.28% compared with the amount at the
beginning of the period, mainly caused by merging Jiangsu Kehang.
Section V The Management’s Discussion and AnalysisSection V The Management’s Discussion and Analysis
Annual Report 2015 23Annual Report 201522
(3) Other receivables at the end of the period is
increased by 251.77% compared with the amount at
the beginning of the period, mainly caused by subsidiary
Shenyang KEDA Clean Energy lending 30.0701 million
yuan to Liaoning Faku Economic and Development Zone
Management Committee, and Jiangsu Kehang’s lending 35
million yuan to Jiangsu Yanbu Construction Group Co., Ltd.,
and the parent company’s export tax rebat 20.0057 million
yuan in the period.
(4) Amount of other current assets at the end of the
period is decreased by 39.99% compared with the amount at
the beginning of the period, mainly caused by redemption of
the bank’s financing products when due.
(5) Amount of long-term equity investment is decreased
by 99.77% compared with the amount at the beginning of the period, mainly caused by the Company’s disposal of
9.6732% equity of Tianjiang Pharmaceutical.
(6) Amount of projects under construction is decreased by 49.20% compared with theamount at the beginning of
the period, mainly caused by completion of Sanshui Base R & D Building of Henglitai Company and KEDA (Anhui) Clean
Energy Workshop which are carried forward into fixed assets.
(7) Amount of intangible assets at the end of the period is increased by 33.49% compared with the amount at the
beginning of the period, mainly caused by merging Jiangsu Kehang.
(8) Amount of deferred income tax assets is increased by 76.97% compared with the amount at the beginning of
the period, mainly caused by more asset depreciation reserve accrued in the period.
(9) Payable at the end of the period is increased by 61.93% compared with the amount at the beginning of the
period, mainly caused by merging Jiangsu Kehang.
(10) The tax payable at the end of the period is increased by 171.31% compared with the amount at the
beginning of the period, mainly caused by sharply increased corporate income tax from transferring equity of Tianjiang
Pharmaceutical.
(11) Amount of Other accounts payable at the end of the period is increased by 159.52% compared with that at the
beginning of the period, mainly caused by merging Jiangsu Kehang and Zhangzhou Juming.
(12) Amount of non-current liabilities due in 1 year at the end of the period is decreased by 58.41% compared with
that at the beginning of the period, mainly caused by the Company’s repaying bank loan.
(13) Amount of other current liabilities at the end of the period is increased by 105.99 million yuan compared with
the amount at the beginning of the period, mainly caused by the Company’s issuing short-term financing securities (15
KEDA Clean Energy CP001) on January 19, 2015, with book value of the securities 100 million yuan and interest rate of
5.99%, mainly used to repay bank loan, improve financing structure and supplement current funds.
(14) The balance of long-term loan at the end of the period is increased by 31.43% compared with that at the
beginning of the period, mainly caused by the parent company’s increased credit loan at Export and Import Bank of
China.
(15) Deferred income at the end of the period is increased by 124.25% compared with the amount at the beginning of
the period, mainly caused by the subsidiary Shenyang KEDA Clean Energy granted 33 million yuan by Liaoning Faku Economic
and Development Zone Management Committee for cycle reconstruction pilot operation and the subsidiary Henglitai Company
granted 15 million yuan by Leping Economic Promotion Bureau of Sanshui District for enterprise support.
(16) The deferred income tax liabilities at the end of the period is increased by 88.39% compared with that at the
beginning of the period, mainly caused by merging Jiangsu Kehang.
(III) Analysis of main shareholding and joint stock companies Unit: 10 thousand yuan, currency: RMB
Company name Nature of
business
Registered
capital
The Company’s
shareholding
ratio(%)
Total
assets Net assets Net profit
KEDA (Anhui) Industrial
Co., Ltd.
Manufacturing
industry 68,000.00 100.00 98,605.54 73,495.86 -4,055.04
KEDA (Anhui) Clean
Energy Co., Ltd.
Manufacturing
industry4,460.00 68.44 83,531.27 52,619.25 5,343.31
Shenyang KEDA Clean
Energy Gas Co., Ltd.
Manufacturing
industry40,000.00 82.50 108,426.85 3,866.00 -11,663.18
Foshan Henglitai
Machinery Co., Ltd.
Manufacturing
industry2,560.00 100.00 84,345.64 53,057.35 8,981.93
Henan KEDA Dongda
International Engineering
Co., Ltd.
Manufacturing
industry5,000.00 100.00 37,142.17 15,520.66 4,520.95
III. Discussion and analysis on the Company’s development
in the future
(I) Industrial competition layout and development trend
Building material machinery business: during the reporting
period, China is under the transitional period from high-speed
growth to medium and high-speed growth. Affected by this,
the Company’s main lower-reaches industry-building ceramic
industry experienced production drop for the first time in the
new century, the market has relatively low requirements on the
conventional building material products, and the building material
machinery industry also fell down. Nevertheless, with more
inventory equipment enters update cycle and possible rebounding
of macroscopic economy, domestic business of the building
material machinery is expected to enter stable development
stage. Unlike the domestic market, the overseas market still
has high requirements on building material products. In the year
2015, export of building and hygiene products is 13 billion USD,
increasing by 12.1% correspondingly; meanwhile, supported
by development philosophy of “The Belt, and The Road” and
international production capacity cooperation, the building material
industry opened the strategic step of “going global”. As a leading
enterprise of domestic building material machinery, the Company
faces extremely excellent historical challenges in overseas market.
Section V The Management’s Discussion and AnalysisSection V The Management’s Discussion and Analysis
Annual Report 2015 25Annual Report 201524
Clean energy environmental protection business: in the year 2015, clean and efficient utilization and exhaust
gas control in industrial field were concerned by government authorities. With improvement of economic efficiency and
adaptability in the field, the Company’s clean coal gasification business and smoke control business will meet better
development opportunities and market drive.
(II) Corporate development strategy
Under the conditions of atmosphere pollution of China to be improved, the Company continues to respond the
call of energy saving and emission reduction by the government, closely follows the trend of efficient utilization of
coal, accelerates industrial distribution of clean energy and environmental protection business; adheres to technology
innovation, continuously perfects and optimizes business operation, solidifies core competitiveness and keeps leading
position in the industry; surrounded by “The Belt, and The Road” development strategy, the Company seeks the
cooperation opportunity of “going global” for building material industry, seeks advantageous overseas cooperation
partners, arranges overseas emerging market and increases the Company’s international business share; besides, the
Company sees the energy saving and environmental protection industry with opening attitude, enters the emerging
industry when appropriate, and develops new profit growth points.
(III) Business plan
The Company’s business objective in 2016 is “keep and increase domestic business, and increase overseas
business sharply”, and total sales revenue is 5.5 billion yuan (tax included).
The business plan does not constitute the Company’s performance commitment on investors, and the investors are
recommended to notice investment risks.
(IV) Possible risks
1. Risk of increased overdue amount in receivables
According to characteristics of large machinery and equipment and outfit industry, the Company’s partial business
is sold through financing and leasing. In recent years, affected by overall domestic economic situations, the Company’s
partial lower-reaches customers tighten capital chain. Although various measures preventing risks have been adopted,
some customers are still overdue, and the risk of receivables overdue is increased.
2. Risk of technology research and development
The Company knows building ceramics machinery, new wall material machinery and clean coal gasification system
and other core technologies through absorption and independent innovation, and has matured R & D modes. In the
new product development field, the Company provides R & D expenditures. Due to long cycle of new product and new
technology R & D, technical stability and marketing of new products are still uncertain; therefore, R & D risks of new
products and new technologies still exist.
3. Risk of goodwill depreciation
In recent years, the Company acquired many companies by asset reconstruction and capital increasing. Under
down macroscopic economic conditions, the acquired companies develop than expected. Till the end of the reporting
period, the Company’s goodwill balance is 648 million yuan. In the future, if the acquired subsidiaries do not operate well
and cannot be changed, the Company accrues the risk of goodwill depreciation.
4. Risk of overseas investment
Adapting to the national “The Belt, and The Road” development strategy and combined with the Company’s
development advantages, except for the conventional equipment sales mode, the Company develops the overseas
market actively. During the reporting period, the Company launches the “joint venture plant+ complete production line
sales”. At present, many African joint stock subsidiaries have been established. The Company establishes subsidiaries in
overseas countries, and may involve overseas business and management risks due to culture, customs, politics, law and
natural environment in different countries and regions; meanwhile, factors like more currencies and change of exchange
rate may depreciate earnings and affect fund recovery.
IV. Details and causes that the Company’s failure to disclose due to being not applicable to rules or special
causes
□ Applicable √ Not applicable
Section VI Important Notice Section VI Important Notice
Annual Report 2015 27Annual Report 201526
I. Proposal of profit distribution of ordinary shares or capital public reserve to increase shares
(I) Drafting, executing or adjusting the cash dividend policy
During the reporting period, the Company implemented the profit distribution plan for the year 2014: with
697,227,161 shares as the base, cash dividend 2.00 yuan (tax included) is distributed to all shareholders for each 10
shares, and cash dividend 139,445,432.20 yuan is distributed, accounting for 31.26% of profits of the Company to
be distributed. The Company’s profit distribution plan and distribution procedure are in conformity with the Articles of
Association of the Company and resolutions adopted by the Shareholders’ Conference. The Company’s independent
director issued independent opinions on the Company’s profit distribution, and the Company provided opportunities for
minority shareholders to express their opinions and requests and safeguard the minority shareholders’ equities.
(II) Profit distribution plan or proposal for ordinary shares and plan or proposal for public capital reserve
transferred to increase capital for the Company in the past 3 years (including the reporting period)
Unit: yuan, currency: RMB
Year for
dividend
Bonus
shares
for each
10 shares
(share)
Dividend
distributed
for each
10 shares
(yuan) (tax
included)
Transferred
to increase
capital
for each
10 shares
(share)
Amount of cash
dividend (tax
included)
Net profit
attributed to
shareholders
of listing
companies in
the consolidated
statement for
dividend year
Rate of net
profit attributed
to shareholders
of listing
companies
in the
consolidated
statements (%)
Year 2015 0 2.00 10 141,146,432.20 541,317,578.26 26.07
Year 2014 0 2.00 0 139,445,432.20 446,104,686.59 31.26
Year 2013 0 1.70 0 117,041,967.37 370,206,247.63 31.62
II. Details of appoint or removing CPA FirmsUnit: 10 thousand yuan, currency: RMB
Appoint
Names of domestic CPA firm Zhongxi CPA Firm (special general partnership)
Remuneration of domestic CPA firm 60
Number of years of audit of domestic CPA firm 15
Name Remuneration
CPA Firm for internal control and audit Zhongxi CPA Firm (special general partnership) 25
Financial consultant Southwest Securities Co., Ltd. 0
Annual Report 2015 29Annual Report 201528
Section VII Change of ordinary shares and details of shareholders Section VII Change of ordinary shares and details of shareholders
I. Change of share capital of ordinary shares
(I) Change of shares of ordinary shares
1. Details of shares of ordinary shares Unit: share
Before the change This increment or decrement (+,–) After the change
Quantity Ratio
(%)
New
shares
issued
Bonus
share
Public
reserve fund
transferred
to shares
Others Subtotal Quantity Ratio
(%)
I. Shares with restrictive
sales conditions 41,888,302 6.008 -24,892,841 -24,892,841 16,995,461 2.408
1.State shareholding
2.State-owned juristic person
shareholding 1,699,546 0.244 1,699,546 0.241
3.Other domestic capital
shareholding40,188,756 5.764 -24,892,841 -24,892,841 15,295,915 2.167
Wherein: domestic non-
state-owned juristic person
shareholding
5,238,000 0.751 -5,238,000 -5,238,000 0 0
Domestic natural person
shareholding 34,950,756 5.013 -19,654,841 -19,654,841 15,295,915 2.167
4.Foreign capital shareholding
Wherein: overseas juristic
person shareholding
Overseas natural person
shareholding
II. Circulating shares without
restrictive sales conditions 655,338,859 93.992 8,505,000 24,892,841 33,397,841 688,736,700 97.592
1.RMB ordinary shares 655,338,859 93.992 8,505,000 24,892,841 33,397,841 688,736,700 97.592
2.Foreign capital share listed
domestically
3.Foreign capital share listed
overseas
4.Miscellaneous
III. Total number of ordinary
shares 697,227,161 100.00 8,505,000 0 8,505,000 705,732,161 100.00
II. Details of shareholders
(I) Total number of shareholders
Total number of shareholders of ordinary shares till the end of the reporting period (number of
shareholders) 37,351
Total number of shareholders of ordinary shares till the end of the last month before disclosure of the
annual report (number of shareholders) 44,161
(II) Details of shareholding of the top 10 shareholders and top 10 circulating shareholders (or shareholders
without restrictive sales conditions) before the end of the reporting period Unit: share
Shareholding of the top 10 shareholders
Full name of shareholders
(full name)
Increment or
decrement in
the reporting
period
Quantity of
shareholding
at the end of
the period
Ratio(%)
Quantity of
shares with
restrictive sales
conditions
Pledge or freezing
Nature of
shareholders Status of
shares Quantity
Lu Qin 0 105,991,667 15.02 0 None 0Domestic
natural person
Bian Cheng 1,365,307 48,999,799 6.94 0 Pledged 4,300,000Domestic
natural person
Chen Jize 10,911,810 22,824,500 3.23 0 UnknownDomestic
natural person
Hui Tianze Investment Co., Ltd. 9,619,021 9,619,021 1.36 0 UnknownDomestic
natural person
Chen Xian 2,973,556 8,129,132 1.15 0 UnknownDomestic
natural person
Shen Xiaohe 0 6,486,098 0.92 0 Pledged 2,253,000Domestic
natural person
The People’s Insurance
Company (Group) of China
Limited-conventional-ordinary
insurance product-008C-
CT001 Hu
6,076,200 6,076,200 0.86 0 Unknown Others
China Resources Shenguotou
Trust Co., Ltd.-Runjin No. 35
collective fund trust plan
5,699,700 5,699,700 0.81 0 Unknown Others
Shao Xiuhong 5,200,000 5,200,000 0.74 0 UnknownDomestic
natural person
Xu Shunwu -340,300 4,613,410 0.65 0 UnknownDomestic
natural person
Details of top 10 shareholders without restrictive sales conditions
Shareholders’ full name Quantity of circulating shares
without restrictive sales conditions
Type and quantity of shares
Type Quantity
Lu Qin 105,991,667 RMB ordinary shares 105,991,667
Bian Cheng 48,999,799 RMB ordinary shares 48,999,799
Chen Jize 22,824,500 RMB ordinary shares 22,824,500
Huitianze Investment Co., Ltd. 9,619,021 RMB ordinary shares 9,619,021
Chen Xian 8,129,132 RMB ordinary shares 8,129,132
Shen Xiaohe 6,486,098 RMB ordinary shares 6,486,098
The People’s Insurance Company (Group) of China
Limited-conventional-ordinary insurance product-
008C-CT001 Hu
6,076,200 RMB ordinary shares 6,076,200
China Resources Shenguotou Trust Co., Ltd.-Runjin
No. 35 collective fund trust plan5,699,700 RMB ordinary shares 5,699,700
Shao Xiuhong 5,200,000 RMB ordinary shares 5,200,000
Xu Shunwu 4,613,410 RMB ordinary shares 4,613,410
Description of relationship of
the above shareholders or
acting in concert
Of the above shareholders, the 1st majority shareholder and the 2nd majority shareholder are not of correlated
relation or of persons acting in concert, and the remaining shareholders of correlated relation or persons acting in
concert are unknown.
Annual Report 201530
Section VII Change of ordinary shares and details of shareholders
Number of shares and restrictive sales conditions of the top 10 shareholders Unit: shares
S/N
Name of shareholders
with shares of restrictive
sales conditions
Number of shares
with restrictive
sales conditions
Details of shares with restrictive sales
conditions on market Restrictive sales
conditions Time available for
sales on market
Newly added
number of shares
available on market
1 Lv Dingxiong 4,078,910 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
2 Cui Decheng 3,569,047 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
3
Northeast University
Science & Technology
Group Co., Ltd.
1,699,546 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
4 Wang Xiuwen 679,818 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
5 Zhao Pengxi 509,864 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
6 Li Zhigang 509,864 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
7 Mao Jihong 339,909 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
8 Luo Li 339,909 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
9 Li Baolin 339,909 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
10 Xing Guochun 339,909 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
11 Wu Youwei 339,909 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
12 Yang Qinchen 339,909 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
13 Wang Xingming 339,909 February 26, 2017 0
Not permitted to transfer
within 36 months after
stock right registration
Description of relations of the
above shareholders or the
persons acting in concrete
Of the above shareholders, Lv Dingxiong and Mao Jihong are conjugal relationship, and Lv Dingxiong
and Mao Jihong are persons acting in concert. Other shareholders are not of correlated relations or do
not constitute the persons acting in concert specified in the Management for Information Disclosure of
Shareholding Information Change of Shareholders of Listing Company.
31Annual Report 2015
Section VIII Details of directors, supervisors, senior management and staff
I. Details of shareholding change and remuneration
(I) Details of change of appointed and removed directors, supervisors and senior management and
remunerations during the reporting period
√ Applicable □ Not Applicable Unit: share
Name Title (Notes) Sex Age Effective date Expiry date
Bian Cheng President Male 52 2015-08-20 2018-09-05
Wu Muhai Director Male 43 2015-08-20 2018-09-05
Wu Zhen Director Male 54 2015-08-20 2018-09-05
Liu Xin Director Male 48 2015-09-06 2018-09-05
Hao Laichun Director Male 72 2015-09-06 2018-09-05
Shen Xiaohe Director Male 49 2015-08-20 2018-09-05
Hao Jiming Independent director Male 70 2015-09-06 2018-09-05
Luo Jianhua Independent director Male 52 2015-09-06 2018-09-05
Chen Xiongyi Independent director Male 63 2015-09-06 2018-09-05
Zhu Yafeng Vice President, Secretary of the
Board of Directors Male 34 2015-08-20 2018-09-05
Zeng Fei Vice President, Financial Principal Male 40 2015-08-20 2018-09-05
Zhou Peng Vice President Male 53 2015-08-20 2018-09-05
Fu Qingju The Chairman of the Board of
Supervisors Female 47 2015-08-20 2018-09-05
Song Yibo Supervisor Male 43 2015-08-20 2018-09-05
Yang Shali Supervisor Female 51 2015-08-20 2018-09-05
Tan Dengping Director Male 51 2012-08-20 2015-05-13
Xu Jianqing Director Male 51 2012-08-20 2015-09-05
Lan Hailin Independent director Male 56 2012-08-20 2015-09-05
Huang Zhiwei Independent director Male 77 2012-08-20 2015-09-05
Liu Peilian Independent director Female 62 2012-08-20 2015-09-05
Total / / / / /
II. Details of parent companies and main subsidiaries
(I) Details of the staff
Quantity of on-duty staff of the parent company 2,004
Quantity of on-duty staff of main subsidiaries 2,611
Total quantity of on-duty staff 4,615
Quantity of the retired to be covered by the parent company and main
subsidiaries
Professional compositions
Types of professional composition Quantity of professional composition
Production staff 2,076
Sales staff 182
Technical staff 1,260
Financial staff 94
Administration staff 1,003
Total 4,615
Annual Report 201532
Section VIII Details of directors, supervisors, senior management and staff
Education
Types of education Quantity (persons)
Postgraduate and above 164
Undergraduate 983
Junior college 985
Secondary technical school and below 2,483
Total 4,615
(II) Remuneration policy
According to industrial and job features, the Company provides diverse and competitive remunerations such as
monthly salary, annual salary, commissioning, time-based and piece-based salary. Through implementing periodic
performance assessment and combined with the Company’s development, the Company drafts and adjusts remuneration
policy scientifically, mobilizes the staff activity and keeps the team stability. To ensure long-term incentive for the
management, technicians and key business staff, after Phase-I stock option incentive, the Company launched Phase-
II stock option incentive plan in 2012 to keep continuity of stock option incentive, mobilize the managers and key staff’s
activity, effectively attract and retain excellent managers and key business staff, and realize consistency of interests of
shareholders, the Company and the managers.
Section IX Financial Report
33Annual Report 2015
I. Audit report
√ Applicable □ Not applicable
Audit Report Z.X.S.Z.[2016] No.0705
To all shareholders of KEDA Clean Energy Co., Ltd.:
We have audited financial statements of KEDA Clean Energy Co., Ltd. (hereinafter referred to as “KEDA Clean
Energy”), including consolidated asset balance sheet and balance sheet dated on December 31, 2015, consolidated profit
statement and profit statement, consolidated cash statement and cash statement, consolidated statement of change in
shareholders’ equity and statement of change in shareholders’ equity of year 2015 and annotations to financial statements.
I. The Management’s responsibility for financial statements
Preparing and fairly listing financial statements are responsibilities of the management of KEDA Clean Energy, and
such responsibilities include: (1) preparing financial statements in accordance with the corporate accounting code, and
making it reflect fairly; (2) designing, executing and maintaining necessary internal control to make the financial statements
free of key errors by embezzlement or errors.
II. CPA’s responsibilities
Our responsibilities are to issue audit opinions on the financial statements based on audit. We executed audit in
accordance with rules and regulations of audit code of CPA of China. The audit code of CPA of China requires us to
observe occupational morality code of CPA of China, and plan and execute audit to reasonably ensure that there is no
key error statement in the financial statement.
The audit involves implementing audit procedures to obtain amounts of relevant financial statements and audit
evidences to be disclosed. The chosen audit procedures are subject to CPA’s judgment, including assessment on key
error risks of the financial statements by embezzlement or error. When risk assessment is conducted, CPA considers
internal control related to financial statement preparation and fair listing to design proper audit procedures. The audit
also includes properness of accounting policy selected by the management and properness of accounting estimate, and
assessing general listing of financial statements.
We believe that, the audit evidences acquired are sufficient and proper, and lay a foundation for issuing audit
opinions.
III. Audit opinions
We hold the opinion that, the financial statements of KEDA Clean Energy are prepared in accordance with the
corporate accounting codes in key aspects, fairly reflecting financial conditions of KEDA Clean Energy on December 31,
2015, and business achievements and cash flow of the year 2015.
ZX CPA Firm (special general partnership) CPA of China:
Beijing, China
CPA of China:
April 28, 2016
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 35Annual Report 201534
Consolidated Balance Sheet (continue)
December 31, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, currency: RMB
Item Annotations Closing balance Opening balance
Current liabilities:
Short-term loan VII.16 353,755,304.37 806,634,400.00
Loan from the central bank
Deposit-taking and inter-bank deposit
Borrowing fund
Financial liabilities measured with fair value and
changes accounted into current profits and losses
Derivative financial liabilities
Notes payable VII.17 430,184,109.88 373,808,839.79
Accounts payable VII.18 1,377,248,393.38 850,526,171.84
Accounts pre-received VII.19 681,508,078.97 569,550,679.36
Sell buyback financial assets
Handling charges and commission payable
Payroll payable VII.20 73,978,245.48 67,520,396.22
Tax payables VII.21 125,484,813.02 46,251,912.44
Interest payable
Dividend payable
Other payables VII.22 87,811,359.23 33,835,598.11
Reinsurance accounts payable
Insurance contract provision
Amount of selling and buying securities as agent
Amount of selling securities as agent
Classified as held-to-sale liabilities
Non-current liabilities due in 1 year VII.23 246,597,416.22 589,112,602.08
Other current liabilities VII.24 105,990,000.00
Current liabilities in total 3,482,557,720.55 3,337,240,599.84
Non-current liabilities:
Long-term loan VII.25 366,213,094.45 278,644,825.15
Bonds payable
Wherein: priority share
Perpetual liabilities
Long-term payables
Long-term Payroll payable
Special payables
Estimated liabilities VII.26 1,016,584.28 1,337,032.46
Deferred earnings VII.27 69,405,000.00 30,950,000.00
Deferred income tax liabilities 21,279,713.91 11,295,406.92
Other non-current liabilities VII.28 92,355,735.34 74,409,247.24
Non-current liabilities in total 550,270,127.98 396,636,511.77
Liabilities in total 4,032,827,848.53 3,733,877,111.61
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
II. Financial statements
Consolidated Balance Sheet
December 31, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, currency: RMB
Item Annotations Closing balance Opening balance
Current assets:
Monetary fund VII.1 729,044,894.44 347,877,207.15
Settlement fund
Lending fund
Financial assets measured with fair value and changes accounted into current profits and losses
Derivative financial assets
Notes receivable VII. 2 147,489,721.64 131,626,100.76
Accounts receivables VII.3 1,104,823,386.52 754,034,108.28
Accounts prepaid VII.4 210,486,474.33 128,128,041.36
Premium receivable
Reinsurance accounts receivables
Reinsurance contract provision receivable
Interest receivable
Dividend receivable
Other receivables VII. 5 135,973,904.93 38,653,715.75
Buy buyback financial assets
Stock VII.6 1,311,171,735.45 1,212,553,196.33
Classified as held-to-sale assets
Non-current assets due in 1 year VII.7 1,136,341,034.72 1,279,002,174.13
Other current assets VII.8 139,314,656.82 232,133,109.50
Current assets in total 4,914,645,808.85 4,124,007,653.26
Non-current assets:
Issue loan and advanced payment
Available-for-sale financial assets
Held-to-maturity investment
Long-term receivables VII.9 380,428,530.53 469,000,529.24
Long-term equity investment VII.10 504,484.95 218,147,610.24
Investment property
Fixed assets VII.11 1,908,335,145.27 1,637,053,848.84
Projects under construction VII.12 61,933,091.40 121,923,962.47
Project materials
Fixed assets clearing
Production biological assets
Oil and gas assets
Intangible expenditures VII.13 447,507,250.20 335,241,051.74
Development expenditures
Goodwill VII.14 648,275,725.52 638,086,820.66
Long-term costs to be amortized
Deferred income tax assets VII.15 58,941,908.57 33,306,946.67
Other non-current assets
Non-current assets in total 3,505,926,136.44 3,452,760,769.86
Assets in total 8,420,571,945.29 7,576,768,423.12
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 37Annual Report 201536
Balance Sheet of Parent Company
December 31, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, Currency: RMB
Item Annotations Closing balance Opening balance
Current assets:
Monetary fund 180,452,600.34 90,325,902.70
Financial assets measured with fair value with changes accounted into current profits and losses
Derivative financial assets
Notes receivable 23,527,800.00 36,615,781.17
Accounts receivable XVI. 1 306,325,046.65 408,169,317.47
Accounts pre-paid 36,030,392.86 22,886,571.04
Interest receivable
Dividend receivable
Other receivable XVI.2 1,398,191,988.96 383,113,956.31
Stock 588,738,652.50 494,403,704.77
Classified as held-to-sale assets
Non-current assets due in 1 year
Other current assets 24,182,184.66 114,995,195.05
Current assets in total 2,557,448,665.97 1,550,510,428.51
Non-current assets:
Available-for-sale financial assets
Held-to-maturity investment
Long-term receivables
Long-term equity investment XVI.3 2,462,394,967.03 2,949,036,242.32
Investment property
Fixed assets 267,213,478.71 277,596,645.07
Projects under construction 1,669,251.45 13,469,654.50
Project materials
Fixed assets clearing
Productive biological assets
Oil and gas assets
Intangible assets 43,271,571.66 45,754,882.86
Development expenditures
Goodwill
Long-term costs to be amortized
Deferred income tax assets 3,221,828.28 3,887,153.48
Other non-current assets
Non-current assets in total 2,777,771,097.13 3,289,744,578.23
Assets in total 5,335,219,763.10 4,840,255,006.74
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Consolidated Balance Sheet (continue)
December 31, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, currency: RMB
Item Annotations Closing balance Opening balance
Owner’s equity
Share capital VII.29 705,732,161.00 697,227,161.00
Other equity instruments
Of them: preferred shares
Perpetual liabilities
Capital public reserve VII.30 1,211,095,761.66 1,124,532,368.37
Minus: treasury share
Other comprehensive earnings VII.31 995,346.55 4,942,261.95
Special provision
Surplus reserve VII. 32 255,470,015.90 230,592,948.80
General risk provision
Undistributed profit VII.33 1,934,975,969.16 1,557,980,890.20
Equity attributed to parent company’ owner in
total 4,108,269,254.27 3,615,275,630.32
Minority shareholders’ equity 279,474,842.49 227,615,681.19
Owner’s equity in total 4,387,744,096.76 3,842,891,311.51
Liabilities and owner’s equity in total 8,420,571,945.29 7,576,768,423.12
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 39Annual Report 201538
Balance Sheet of Parent Company (continue)
December 31, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, Currency: RMB
Item Annotations Closing balance Opening balance
Current liabilities:
Short-term loan 152,780,400.00 344,310,400.00
Financial liabilities measured at fair value with changes accounted into current profits and losses
Derivative financial liabilities
Notes payable 143,050,233.01 237,207,761.75
Accounts payable 454,491,640.74 329,265,442.13
Accounts pre-received 279,516,806.85 215,864,219.53
Payroll payable 38,167,825.33 33,681,697.50
Taxes payable 79,441,336.48 11,419,218.16
Interest payable
Dividend payable
Other payables 214,367,804.59 119,101,509.56
Classified as held-to-sale liabilities
Non-current liabilities within 1 year
Other current liabilities 105,990,000.00
Current liabilities in total: 1,467,806,047.00 1,290,850,248.63
Non-current liabilities:
Long-term loan 180,000,000.00 60,000,000.00
Bonds payable
Wherein: priority share
Perpetual debts
Long-term payables
Long-term Payroll payable
Special payables
Estimated liabilities
Deferred earnings 5,205,000.00 6,450,000.00
Deferred income tax liabilities
Other non-current liabilities 50,376,332.67 52,410,000.00
Non-current liabilities in total 235,581,332.67 118,860,000.00
Liabilities in total 1,703,387,379.67 1,409,710,248.63
Owner’s equity:
Share capital 705,732,161.00 697,227,161.00
Other equity instruments
Wherein: priority share
Perpetual debt
Capital public reserve 1,277,817,512.49 1,194,360,126.03
Minus: stock share
Other comprehensive earnings
Special provision
Surplus reserve 248,462,972.87 223,585,905.77
Undistributed profit 1,399,819,737.07 1,315,371,565.31
Owner’s equity in total 3,631,832,383.43 3,430,544,758.11
Liabilities and owner’s equity in total 5,335,219,763.10 4,840,255,006.74
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Consolidated Profit Statement
January to December, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, Currency: RMB
Item Annotation Amount occurred
this period
Amount occurred
last period
I. Total business revenue 3,593,684,258.82 4,465,875,887.35
Wherein: business revenue VII.34 3,593,684,258.82 4,465,875,887.35
Interest income
Premium earned
Handling charge and commission income
II. Total business revenue 3,647,569,513.91 4,071,289,290.40
Wherein: operation cost VII.34 2,776,062,370.08 3,403,716,998.95
Interest expenditures
Handling charge and commission expenditures
Surrender value
Net amount of indemnity expenditures
Net amount of withdrawing insurance contract provision
Policy dividend expenditure
Reinsurance costs
Business taxes and extra VII 35 28,616,719.21 29,078,509.69
Sales expense VII 36 207,402,622.04 208,231,880.82
Overhead VII 37 406,681,235.74 356,892,103.03
Financial costs VII 38 29,692,297.40 24,166,382.18
Asset impairment losses VII 39 199,114,269.44 49,203,415.73
Add: earnings from change of fair value (losses marked with “-”)
Investment earnings (losses marked with “-”) VII 40 708,352,619.78 64,554,745.88
Wherein: earnings from investment on joint ventures and cooperative 50,019,378.05 64,718,670.43
Earnings from exchange and remittance (losses marked with “-”)
III. Business profits (losses marked with “-”) 654,467,364.69 459,141,342.83
Add: non-business income VII 41 88,982,120.85 57,598,985.02
Wherein: gains from disposal of non-current assets 3,249,907.50 522,596.81
Minus: non-business expenditures VII 42 84,412,206.23 4,428,388.75
Wherein: losses from disposal of non-current assets 56,401,117.35 1,927,113.49
IV. Total profit (total losses marked with “-”) 659,037,279.31 512,311,939.10
Minus: income tax costs VII 43 127,248,264.20 84,105,990.66
V. Net profit (net losses marked with “-”) 531,789,015.11 428,205,948.44
Net profits attributed to parent company’s owners 541,317,578.26 446,104,686.59
Minority shareholders’ profits and losses -9,528,563.15 -17,898,738.15
VI. After-tax net amount of other comprehensive earnings -3,946,915.40 1,016,140.91
After-tax net amount of other comprehensive earnings attributed to parent company’s owner -3,946,915.40 1,016,140.91
(I)Other comprehensive earnings not reclassified as profits and losses
1. Changes of net liabilities or net assets from re-measuring or re-defining benefit plan
2. Shares of other comprehensive earnings of the invested unit not reclassified as
profits and losses under equity law
(II)Other comprehensive earnings reclassified as profits and losses -3,946,915.40 1,016,140.91
1.Shares of other comprehensive proceeds of the invested unit reclassified as profits
and losses under equity law
2. Profits and losses from change of fair value of available-for-sale financial assets
3. Profits and losses from held-to-maturity reclassified available-for-sale financial assets
4. Effective part of profits and losses from cash flow hedging
5. Difference from conversion of financial statements in foreign currency -3,946,915.40 1,016,140.91
6. Others
After-tax net amount of other comprehensive earnings attributed to minority shareholders
VII.Total comprehensive earnings 527,842,099.71 429,222,089.35
Total earnings attributed to parent company’s owners 537,370,662.86 447,120,827.50
Total earnings attributed to minority shareholders -9,528,563.15 -17,898,738.15
VIII.Earnings per share
(I)Basic earnings per share (yuan/share) 0.771 0.647
(II)Diluted earnings per share (yuan/share) 0.771 0.638
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 41Annual Report 201540
Profit Statement of Parent Company
January to December, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, Currency: RMB
Item Annotation Amount occurred
in this period
Amount occurred
in the last period
I. Business revenue XVI.4 1,773,711,936.37 2,005,205,016.65
Minus: business cost XVI.4 1,460,896,453.47 1,614,018,645.82
Business tax and extra 10,237,959.34 10,528,042.16
Sales cost 118,717,215.61 111,437,728.55
Overhead 152,641,788.44 110,119,094.32
Financial costs 17,677,353.79 12,366,508.51
Asset impairment losses 13,879,994.86 7,617,419.22
Add: earnings from change of fair value (losses marked with “-”)
Investment earnings (losses marked with “-”) 317,553,938.92 239,718,670.43
Wherein: earnings from investment on joint ventures and
cooperative50,019,378.05 64,718,670.43
II. Business profits (losses marked with “-”) 317,215,109.78 378,836,248.50
Add: non-business income 13,905,556.20 10,278,120.42
Wherein: gains from disposal of non-current assets 191,962.71 3,153.00
Minus: non-business expenditures 693,518.66 1,022,469.07
Wherein: losses from disposal of non-current assets 394,847.91 17,551.76
III. Total profit (total losses marked with “-”) 330,427,147.32 388,091,899.85
Minus: income tax costs 81,656,476.26 11,246,123.06
IV. Net profit (net losses marked with “-”) 248,770,671.06 376,845,776.79
V. After-tax net amount of other comprehensive earnings
(I)Other comprehensive earnings not reclassified as profits and losses
1. Changes of net liabilities or net assets from re-measuring or
re-defining benefit plan
2. Shares of other comprehensive earnings of the invested unit not
reclassified as profits and losses under equity law
(II)Other comprehensive earnings reclassified as profits and losses
1. Shares of other comprehensive proceeds of the invested unit
reclassified as profits and losses under equity law
2. Profits and losses from change of fair value of available-for-sale
financial assets
3. Profits and losses from held-to-maturity reclassified available-for-
sale financial assets
4. Effective part of profits and losses from cash flow hedging
5. Difference from conversion of financial statements in foreign
currency
6. Others
VI. Total comprehensive earnings
VII.Earnings per share
(I)Basic earnings per share (yuan/share)
(II)Diluted earnings per share (yuan/share)
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Consolidated Cash Flow Statement
January to December, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, Currency: RMB
Item Annotation Amount occurred in
the current period
Amount occurred in
the last period
I. Cash flow from business activities
Cash received from selling commodity and providing labors 3,406,877,146.13 3,657,089,301.59
Net increment from client deposit and inter-bank deposit
Net increment from loan of the central bank
Net increment from borrowed funds of other financial institutions
Cash received from premium of original insurance contracts
Net cash amount received from reinsurance business
Net increment from the insured’ deposit and investment
Net increment from disposal of financial values measured at fair value and changes into current
profits and losses
Cash received from interest, handling charge and commission
Net increment from borrowing funds
Net increment from buyback business
Tax return received 60,077,240.93 28,939,586.74
Other cash received related to business activities VII.44 200,295,752.36 50,509,251.64
Business activities cash inflow subtotal 3,667,250,139.42 3,736,538,139.97
Cash paid for buying commodity and receiving labor 2,195,178,513.23 3,044,684,353.23
Net increment from clients’ goods payment and advanced payment
Net increment from depositing with the central bank and inter-bank deposit
Cash paid to indemnity of the original insurance contract
Cash paid for interest, handling charge and commissioning
Cash paid for policy dividend
Cash paid to and for the staff 411,677,907.33 410,526,949.22
Taxes paid 261,685,604.53 327,650,049.76
Other cash paid related to business activities VII.44 233,769,309.54 237,934,694.05
Business activities cash outflow subtotal 3,102,311,334.63 4,020,796,046.26
Net cash amount from business activities 564,938,804.79 -284,257,906.29
II. Cash flow from investment activities
Cash received from recovering investment 931,378,336.36
Cash received from acquiring investment earnings 12,473,239.08
Net cash amount from disposal of fixed assets, intangible assets and other long-term assets 1,875,386.79 102,056.00
Net cash amount from disposal of subsidiaries and other operators 899,903.58
Other cash received related to investment activities VII.44 107,000,000.00
Investment activities cash inflow subtotal 1,040,253,723.15 13,475,198.66
Cash paid for purchasing fixed assets, intangible assets and other long-term assets 112,975,730.17 123,079,960.55
Cash paid for investment 1,901,850.00 19,335,381.69
Net increment from pledge loan
Net cash amount paid by subsidiaries and other operators 159,209,218.93 80,341,994.14
Other cash paid related to investment activities 107,000,000.00
Investment activities cash outflow subtotal 274,086,799.10 329,757,336.38
Net cash amount from investment activities 766,166,924.05 -316,282,137.72
III. Cash flow from raising activities
Cash received from deposit taking 99,852,150.00 193,212,350.00
Wherein: cash received from subsidiaries’ taking minority shareholders’ investment 19,150,000.00
Cash received from loan 1,869,703,754.37 1,716,238,238.82
Cash received from issuing bonds 99,600,000.00
Other cash received related to raising activities VII.44 189,643,262.13 114,513,121.24
Fund raising activities cash inflow subtotal 2,258,799,166.50 2,023,963,710.06
Cash paid for repaying debt 2,886,661,409.92 1,225,704,067.06
Cash paid for distributing dividend, profit or repaying interest 223,391,761.67 209,319,363.13
Wherein: dividend and profit paid to minority shareholders by subsidiaries
Other cash paid related to raising activities VII.44 161,206,576.76 159,819,097.31
Fund raising activities cash outflow subtotal 3,271,259,748.35 1,594,842,527.50
Net cash amount from raising activities -1,012,460,581.85 429,121,182.56
IV. Influences on cash and cash equivalent by change of exchange rate 9,463,887.48 3,948,180.14
V. Net increment of cash and cash equivalent 328,109,034.47 -167,470,681.31
Add: cash and cash equivalent balance at the beginning of the period 257,948,223.08 425,418,904.39
VI. Cash and cash equivalent balance at the end of the period 586,057,257.55 257,948,223.08
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 43Annual Report 201542
Cash Flow Statement of Parent Company
January to December, 2015Prepared by: KEDA Clean Energy Co., Ltd. Unit: yuan, Currency: RMB
Item AnnotationAmount occurred
in this period
Amount occurred
in the last period
I. Cash flow from business activities
Cash received from selling commodity and providing labor s 2,100,163,055.72 2,040,866,686.77
Tax received from rebating 41,421,150.31 12,519,190.03
Cash received related to business activities 490,018,493.41 112,560,896.77
Business activities cash inflow subtotal 2,631,602,699.44 2,165,946,773.57
Cash paid for buying commodity and receiving labor 1,371,769,078.71 1,406,838,386.43
Cash paid for and to the staff 191,353,504.52 190,950,970.92
Taxes paid 61,338,861.48 73,760,843.41
Other cash paid related to business activities 1,761,274,118.81 426,714,515.98
Business activities cash outflow subtotal 3,385,735,563.52 2,098,264,716.74
Net cash flow amount from business activities -754,132,864.08 67,682,056.83
II. Cash flow from investment activities
Cash received from recovering investment 931,378,336.36 19,151,100.00
Cash received from acquiring investment earnings 20,000,000.00 187,473,239.08
Net cash amount recovered from disposal of fixed assets,
intangible assets and other long-term assets248,107.40 930.00
Net cash amount form disposal of subsidiaries and other operators 79,456,970.70 900,000.00
Other cash received related to investment activities 100,000,000.00
Investment activities cash inflow subtotal 1,131,083,414.46 207,525,269.08
Cash paid for purchasing fixed assets, intangible assets and other
long-term assets 7,422,110.33 33,667,212.51
Cash paid for investment 244,601,850.00 411,335,381.69
Net cash amount received paid by subsidiaries and other
operators
Other cash paid related to investment activities 100,000,000.00
Investment activities cash outflow subtotal 252,023,960.33 545,002,594.20
Net cash amount from investment activities 879,059,454.13 -337,477,325.12
III. Cash flow received from raising activities
Cash received from absorbing investment 80,202,150.00 193,212,350.00
Cash received from borrowing 573,728,850.00 547,334,626.34
Cash received from issuing bonds 99,600,000.00
Other cash received related to raising activities 41,878,527.61 17,017,546.80
Raising activities cash inflow subtotal 795,409,527.61 757,564,523.14
Cash repaid for debt 635,841,705.75 370,115,890.00
Cash paid for dividend and profit distribution or repaying interest 158,739,658.00 132,765,611.80
Cash paid related to raising activities 30,983,008.36 32,577,182.95
Cash outflow subtotal for fund raising 825,564,372.11 535,458,684.75
Net amount of cash flow from fund raising activities -30,154,844.50 222,105,838.39
IV. Influences on cash and cash equivalent by change of
exchange rate 6,250,471.34 3,167,668.59
V. Net increment of cash and cash equivalent 101,022,216.89 -44,521,761.31
Add: cash and cash equivalent balance at the beginning of the
period 51,230,266.55 95,752,027.86
V. Cash and cash equivalent balance at the end of the period 152,252,483.44 51,230,266.55
Legal representative: Principal in charge of accounting: Principal of accounting organization:
Wu Muhai Zeng Fei Zeng Fei
Co
nso
lidat
ed S
tate
men
t o
f C
han
ge
in O
wn
er’s
Eq
uit
y
Jan
uar
y to
Dec
emb
er,
2015
Pre
par
ed b
y: K
ED
A C
lean
Ene
rgy
Co.
, Lt
d.
U
nit:
yua
n, C
urre
ncy:
RM
B
Item
This
per
iod
Ow
ner’s
equ
ity a
ttrib
uted
to p
aren
t com
pany
M
inor
ity
shar
ehol
ders
’ eq
uity
Ow
ner’s
equ
ity in
to
tal
Shar
e ca
pita
l O
ther
equ
ity in
stru
men
ts
Capi
tal p
ublic
re
serv
e
Min
us:
stoc
k sh
are
Oth
er
com
preh
ensi
ve
rese
rve
Spec
ial
rese
rve
Surp
lus
publ
ic
rese
rve
Gen
eral
ris
k pr
ovis
ion
Undi
strib
uted
pr
ofit
Prio
rity
shar
ePe
rpet
ual
debt
Oth
ers
I. Ba
lanc
e at
the
end
of th
e la
st y
ear
697,
227,
161.
001,
124,
532,
368.
374,
942,
261.
9523
0,59
2,94
8.80
1,55
7,98
0,89
0.20
227,
615,
681.
193,
842,
891,
311.
51
Add:
cha
nge
of a
ccou
nting
pol
icy
Co
rrect
ion
of p
revio
us e
rrors
Ente
rpris
e m
ergi
ng u
nder
the
sam
e co
ntro
l
Ot
hers
II.
Bal
ance
at t
he b
egin
ning
of t
he y
ear
697,
227,
161.
001,
124,
532,
368.
374,
942,
261.
9523
0,59
2,94
8.80
1,55
7,98
0,89
0.20
227,
615,
681.
193,
842,
891,
311.
51
III. I
ncre
men
t or d
ecre
men
t of t
his
perio
d (d
ecre
men
t mar
ked
with
“-”
) 8,
505,
000.
0086
,563
,393
.29
-3,9
46,9
15.4
024
,877
,067
.10
376,
995,
078.
9651
,859
,161
.30
544,
852,
785.
25
(I)Tot
al am
ount
of c
ompr
ehen
sive
earn
ings
-3,9
46,9
15.4
054
1,31
7,57
8.26
-9,5
28,5
63.1
552
7,84
2,09
9.71
(II)Ow
ner’s
incr
ease
d an
d de
crea
sed
capi
tal
8,50
5,00
0.00
86,5
63,3
93.2
9
61
,387
,724
.45
156,
456,
117.
741.
Ord
inary
sha
res
inves
ted
by s
hare
hold
ers
8,50
5,00
0.00
71,6
97,1
50.0
0
19
,150
,000
.00
99,3
52,1
50.0
02.
Cap
ital in
vest
ed b
y ot
her e
quity
inst
rum
ent h
olde
rs
3. A
mou
nt o
f sha
re p
aym
ent a
ccou
nted
into
own
er’s
eq
uity
4. O
ther
s 14
,866
,243
.29
42,2
37,7
24.4
557
,103
,967
.74
(II)Pr
ofit d
istrib
utio
n 24
,877
,067
.10
-164
,322
,499
.30
-139
,445
,432
.20
1. W
ithdr
aw S
urpl
us re
serv
e 24
,877
,067
.10
-24,
877,
067.
102.
With
draw
gen
eral
risk
prov
ision
3.
Dist
ribut
ion
to a
ll own
ers
(or s
hare
hold
ers)
-139
,445
,432
.20
-139
,445
,432
.20
4. O
ther
s (IV
)Inte
rnal
carry
ing-fo
rwar
d ins
ide
owne
r’s e
quity
1.
Cap
ital p
ublic
rese
rve
to in
crea
se c
apita
l (or c
apita
l sh
are)
2.
Sur
plus
pub
lic re
serv
e to
incr
ease
cap
ital (o
r cap
ital
shar
e)
3. S
urpl
us p
ublic
rese
rve
to c
ompe
nsat
e lo
sses
4.
Oth
ers
(V) S
pecia
l pro
visio
n 1.
Am
ount
with
draw
n th
is pe
riod
2. A
mou
nt u
sed
this
perio
d (V
I)Oth
ers
IV. B
alan
ce a
t the
end
of t
he p
erio
d 70
5,73
2,16
1.00
1,21
1,09
5,76
1.66
995,
346.
5525
5,47
0,01
5.90
1,93
4,97
5,96
9.16
279,
474,
842.
494,
387,
744,
096.
76
Leg
al r
epre
sen
tati
ve:W
u M
uh
ai
Pri
nci
pal
in c
har
ge
of
acco
un
tin
g:Z
eng
Fei
P
rin
cip
al o
f ac
cou
nti
ng
org
aniz
atio
n:
Zen
g F
ei
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 45Annual Report 201544
Co
nso
lidat
ed S
tate
men
t o
f C
han
ge
in O
wn
er’s
Eq
uit
y (c
on
tin
ue)
Jan
uar
y to
Dec
emb
er,
2015
Pre
par
ed b
y: K
ED
A C
lean
Ene
rgy
Co.
, Lt
d.
U
nit:
yua
n, C
urre
ncy:
RM
B
Item
Last
per
iod
Ow
ner’s
equ
ity a
ttrib
uted
to p
aren
t com
pani
es
Min
ority
sh
areh
olde
rs’
equi
ty
Ow
ner’s
equ
ity in
to
tal
Shar
e ca
pita
l O
ther
equ
ity in
stru
men
tsCa
pita
l res
erve
M
inus
: st
ock
shar
e
Oth
er
com
preh
ensi
ve
earn
ings
Spec
ial
prov
isio
nSu
rplu
s re
serv
e G
ener
al
risk
prov
isio
n
Undi
strib
uted
pr
ofit
Prio
rity
shar
e Pe
rpet
ual
shar
e O
ther
s
I. Ba
lanc
e at
the
end
of th
e la
st y
ear
666,
248,
700.
0074
9,65
4,45
0.47
3,92
6,12
1.04
192,
908,
371.
121,
266,
602,
748.
6624
1,07
8,19
3.49
3,12
0,41
8,58
4.78
Add:
cha
nge
of a
ccou
nting
pol
icyCo
rrect
ion
of p
revio
us e
rrors
Ente
rpris
e m
ergi
ng u
nder
the
sam
e co
ntro
l Ot
hers
II.
Bal
ance
at t
he b
egin
ning
of t
he y
ear
666,
248,
700.
0074
9,65
4,45
0.47
3,92
6,12
1.04
192,
908,
371.
121,
266,
602,
748.
6624
1,07
8,19
3.49
3,12
0,41
8,58
4.78
III. I
ncre
men
t or d
ecre
men
t of t
his
perio
d (d
ecre
men
t mar
ked
with
“-”
) 30
,978
,461
.00
374,
877,
917.
901,
016,
140.
9137
,684
,577
.68
291,
378,
141.
54-1
3,46
2,51
2.30
722,
472,
726.
73
(I)Tot
al am
ount
of c
ompr
ehen
sive
earn
ings
1,01
6,14
0.91
446,
104,
686.
59-1
7,89
8,73
8.15
429,
222,
089.
35(II)
Owne
r’s in
crea
sed
and
decr
ease
d ca
pita
l 30
,978
,461
.00
374,
877,
917.
904,
436,
225.
8541
0,29
2,60
4.75
1. O
rdina
ry s
hare
s inv
este
d by
sha
reho
lder
s 30
,978
,461
.00
379,
174,
882.
00-8
,891
,800
.00
401,
261,
543.
002.
Cap
ital in
vest
ed b
y ot
her e
quity
inst
rum
ent h
olde
rs
3. A
mou
nt o
f sha
re p
aym
ent a
ccou
nted
into
own
er’s
eq
uity
18,2
64,9
47.8
3
18
,264
,947
.83
4. O
ther
s -2
2,56
1,91
1.93
13,3
28,0
25.8
5-9
,233
,886
.08
(II)Pr
ofit d
istrib
utio
n 37
,684
,577
.68
-154
,726
,545
.05
-117
,041
,967
.37
1. W
ithdr
aw S
urpl
us re
serv
e 37
,684
,577
.68
-37,
684,
577.
682.
With
draw
gen
eral
risk
prov
ision
3.
Dist
ribut
ion
to a
ll own
ers
(or s
hare
hold
ers)
-117
,041
,967
.37
-117
,041
,967
.37
4. O
ther
s (IV
)Inte
rnal
carry
ing-fo
rwar
d ins
ide
owne
r’s e
quity
1.
Cap
ital p
ublic
rese
rve
to in
crea
se c
apita
l (or c
apita
l sh
are)
2.
Sur
plus
pub
lic re
serv
e to
incr
ease
cap
ital (o
r ca
pita
l sha
re)
3. S
urpl
us p
ublic
rese
rve
to c
ompe
nsat
e lo
sses
4.
Oth
ers
(V) S
pecia
l pro
visio
n 1.
Am
ount
with
draw
n th
is pe
riod
2. A
mou
nt u
sed
this
perio
d (V
I)Oth
ers
IV. B
alan
ce a
t the
end
of t
he p
erio
d 69
7,22
7,16
1.00
1,12
4,53
2,36
8.37
4,94
2,26
1.95
230,
592,
948.
801,
557,
980,
890.
2022
7,61
5,68
1.19
3,84
2,89
1,31
1.51
Leg
al r
epre
sen
tati
ve:W
u M
uh
ai
Pri
nci
pal
in c
har
ge
of
acco
un
tin
g:Z
eng
Fei
P
rin
cip
al o
f ac
cou
nti
ng
org
aniz
atio
n:
Zen
g F
ei
Sta
tem
ent
of
Ch
ang
e in
Ow
ner
’s E
qu
ity
for
Par
ent
Co
mp
any
Jan
uar
y to
Dec
emb
er,
2015
Pre
par
ed b
y: K
ED
A C
lean
Ene
rgy
Co.
, Lt
d.
U
nit:
yua
n, C
urre
ncy:
RM
B
Item
This
per
iod
Shar
e ca
pita
l
Oth
er e
quity
inst
rum
ents
Cap
ital r
eser
ve
Min
us:
stoc
k
shar
e
Oth
er
com
preh
ensi
ve
earn
ings
Spec
ial
prov
isio
n Su
rplu
s re
serv
e U
ndis
tribu
ted
profi
t
Ow
ner’s
equ
ity in
tota
l Pr
iorit
y
shar
e
Perp
etua
l
debt
Oth
ers
I. Ba
lanc
e at
the
end
of th
e la
st y
ear
697,
227,
161.
001,
194,
360,
126.
0322
3,58
5,90
5.77
1,31
5,37
1,56
5.31
3,43
0,54
4,75
8.11
Add:
cha
nge
of a
ccou
ntin
g po
licy
Corre
ctio
n of
pre
vious
erro
rs
Oth
ers
II. B
alan
ce a
t the
beg
inni
ng o
f the
yea
r69
7,22
7,16
1.00
1,19
4,36
0,12
6.03
223,
585,
905.
771,
315,
371,
565.
313,
430,
544,
758.
11
III. I
ncre
men
t or d
ecre
men
t of t
his
perio
d (d
ecre
men
t
mar
ked
with
“-”
) 8,
505,
000.
0083
,457
,386
.46
24,8
77,0
67.1
084
,448
,171
.76
201,
287,
625.
32
(I)To
tal a
mou
nt o
f com
preh
ensiv
e ea
rnin
gs24
8,77
0,67
1.06
248,
770,
671.
06
(II)O
wne
r’s in
crea
sed
and
decr
ease
d ca
pita
8,50
5,00
0.00
83,4
57,3
86.4
691
,962
,386
.46
1. O
rdin
ary
shar
es in
vest
ed b
y sh
areh
olde
rs
8,50
5,00
0.00
71,6
97,1
50.0
080
,202
,150
.00
2. C
apita
l inve
sted
by
othe
r equ
ity in
stru
men
t hol
ders
3. A
mou
nt o
f sha
re p
aym
ent a
ccou
nted
into
ow
ner’s
equi
ty
4. O
ther
s 11
,760
,236
.46
11,7
60,2
36.4
6
(III)
Profi
t dist
ribut
ion
24,8
77,0
67.1
0-1
64,3
22,4
99.3
0-1
39,4
45,4
32.2
0
1. W
ithdr
aw S
urpl
us re
serv
e 24
,877
,067
.10
-24,
877,
067.
10
2. W
ithdr
aw g
ener
al ri
sk p
rovis
ion
-139
,445
,432
.20
-139
,445
,432
.20
3. D
istrib
utio
n to
all o
wne
rs (o
r sha
reho
lder
s)
(IV)In
tern
al c
arry
ing-
forw
ard
insid
e ow
ner’s
equ
ity
1. C
apita
l pub
lic re
serv
e to
incr
ease
cap
ital (
or c
apita
l
shar
e)
2. S
urpl
us p
ublic
rese
rve
to in
crea
se c
apita
l (or
cap
ital
shar
e)
3. S
urpl
us p
ublic
rese
rve
to c
ompe
nsat
e lo
sses
4. O
ther
s
(V) S
peci
al p
rovis
ion
1. A
mou
nt w
ithdr
awn
this
perio
d
2. A
mou
nt u
sed
this
perio
d
(VI)O
ther
s
IV. B
alan
ce a
t the
end
of t
he p
erio
d 70
5,73
2,16
1.00
1,27
7,81
7,51
2.49
248,
462,
972.
871,
399,
819,
737.
073,
631,
832,
383.
43
Leg
al r
epre
sen
tati
ve:W
u M
uh
ai
Pri
nci
pal
in c
har
ge
of
acco
un
tin
g:Z
eng
Fei
P
rin
cip
al o
f ac
cou
nti
ng
org
aniz
atio
n:
Zen
g F
ei
Section IX Financial Report
Annual Report 201546
Sta
tem
ent
of
Ch
ang
e in
Ow
ner
’s E
qu
ity
for
Par
ent
Co
mp
any
(co
nti
nu
e)
Jan
uar
y to
Dec
emb
er,
2015
Pre
par
ed b
y: K
ED
A C
lean
Ene
rgy
Co.
, Lt
d.
U
nit:
yua
n, C
urre
ncy:
RM
B
Item
Last
per
iod
Shar
e ca
pita
l
Oth
er e
quity
inst
rum
ents
Cap
ital p
ubC
apita
l
rese
rve
Min
us:
stoc
k
shar
e
Oth
er
com
preh
ensi
ve
earn
ings
Spec
ial
prov
isio
n Su
rplu
s re
serv
e U
ndis
tribu
ted
profi
tPr
iorit
y
shar
e
Perp
etua
l
debt
Oth
ers
I. Ba
lanc
e at
the
end
of th
e la
st y
ear
666,
248,
700.
0079
6,92
0,29
6.20
185,
901,
328.
091,
093,
252,
333.
572,
742,
322,
657.
86
Add:
cha
nge
of a
ccou
ntin
g po
licy
Corre
ctio
n of
pre
vious
erro
rs
Oth
ers
II. B
alan
ce a
t the
beg
inni
ng o
f the
yea
r66
6,24
8,70
0.00
796,
920,
296.
2018
5,90
1,32
8.09
1,09
3,25
2,33
3.57
2,74
2,32
2,65
7.86
III. I
ncre
men
t or d
ecre
men
t of t
his
perio
d (d
ecre
men
t
mar
ked
with
“-”
) 30
,978
,461
.00
397,
439,
829.
8337
,684
,577
.68
222,
119,
231.
7468
8,22
2,10
0.25
(I)To
tal a
mou
nt o
f com
preh
ensiv
e ea
rnin
gs
37
6,84
5,77
6.79
376,
845,
776.
79
(II)O
wne
r’s in
crea
sed
and
decr
ease
d ca
pita
30,9
78,4
61.0
039
7,43
9,82
9.83
428,
418,
290.
83
1. O
rdin
ary
shar
es in
vest
ed b
y sh
areh
olde
rs
30,9
78,4
61.0
037
9,17
4,88
2.00
410,
153,
343.
00
2. C
apita
l inve
sted
by
othe
r equ
ity in
stru
men
t hol
ders
3. A
mou
nt o
f sha
re p
aym
ent a
ccou
nted
into
ow
ner’s
eq
uity
18
,264
,947
.83
18,2
64,9
47.8
3
4. O
ther
s
(III)
Profi
t dist
ribut
ion
37,6
84,5
77.6
8-1
54,7
26,5
45.0
5-1
17,0
41,9
67.3
7
1. W
ithdr
aw S
urpl
us re
serv
e
37
,684
,577
.68
-37,
684,
577.
68
2. W
ithdr
aw g
ener
al ri
sk p
rovis
ion
-117
,041
,967
.37
-117
,041
,967
.37
3. D
istrib
utio
n to
all o
wne
rs (o
r sha
reho
lder
s)
(IV)In
tern
al c
arry
ing-
forw
ard
insid
e ow
ner’s
equ
ity
1. C
apita
l pub
lic re
serv
e to
incr
ease
cap
ital (
or c
apita
l sh
are)
2. S
urpl
us p
ublic
rese
rve
to in
crea
se c
apita
l (or
cap
ital
shar
e)
3. S
urpl
us p
ublic
rese
rve
to c
ompe
nsat
e lo
sses
4. O
ther
s
(V) S
peci
al p
rovis
ion
1. A
mou
nt w
ithdr
awn
this
perio
d
2. A
mou
nt u
sed
this
perio
d
(VI)O
ther
s
IV. B
alan
ce a
t the
end
of t
he p
erio
d 69
7,22
7,16
1.00
1,19
4,36
0,12
6.03
223,
585,
905.
771,
315,
371,
565.
313,
430,
544,
758.
11
Leg
al r
epre
sen
tati
ve:W
u M
uh
ai
Pri
nci
pal
in c
har
ge
of
acco
un
tin
g:Z
eng
Fei
P
rin
cip
al o
f ac
cou
nti
ng
org
aniz
atio
n:
Zen
g F
ei
Section IX Financial Report
47Annual Report 2015
III. Corporate Profile
1. Corporate profile
Date of establishment of the Company: December 11, 1992, registered address: No.1, West Huanzhen Road,
Guanglong Industrial Park, Chencun Town, Shunde District, Foshan City, Guangdong Province, headquarters address:
No.1, West Huanzhen Road, Guanglong Industrial Park, Chencun Town, Shunde District, Foshan City, Guangdong
Province, and the Company’s legal representative: Wu Muhai. Approved by China Securities Regulatory Commission
(CSRC) on September 18, 2002, the Company issued RMB ordinary share 20 million shares to the public for the first
time, and was listed at Shanghai Stock Exchange on October 10, 2002. At present, the registered capital is RMB
705,732,161.00 yuan.
The Company’s business scope: manufacturing of building material machinery for ceramics, stone, wall material,
energy saving and environmental protection materials, research, development and manufacturing of automation
technology and outfit; sales of: electromechanical product parts, grinding wheel and grinding apparatus, grinding
materials and ceramics products; research, development, manufacturing and sales of machinery and equipment
and automation technology and outfit related to clean energy; manufacturing and sales of clean coal gas and steam;
information and technology service, software development and sales, system integration, hardware equipment leasing
and sales, and network technical consultation service; operating export and production for products and relevant
technologies used by the enterprise and member enterprises, and raw and auxiliary materials, machinery and equipment,
instrument and meters, parts and relevant technology import required for scientific research (except for commodities
restricted or prevented from import or export by the state government); operating processing with incoming materials and
“assembling with supplied parts, processing with supplied materials and samples, and compensation trade” (specifics in
accordance with [2000] W.J.M.F.Z.S.Z.H. No.3250)
Industry of the Company: special equipment manufacturing industry.
The Company’s main products: building material machinery, clean gasification outfit, terminal smoke control outfit,
high-end parts and other outfits.
2. Scope of consolidated financial statement
The scope of consolidation of the Company’s consolidated financial statement is determined based on control, all
controlled subsidiaries are accepted in the scope of consolidation of the consolidated financial statements, and newly
accepted subsidiaries, structural entities or business entities formed in other forms are listed as follows:
Name Acquired via
Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd. Merging not under the same control
Ningxia Kehang Environmental Protection Engineering Co., Ltd. Merging not under the same control
Anhui KEDA Clean Energy New Materials Co., Ltd. Merging of newly established enterprise
Zhangzhou Juming Graphite Co., Ltd. Merging not under the same control
Refer to the Annotation “Equities in subsidiaries” on details of subsidiaries accepted in the consolidated financial
statements; refer to “Change of scope of consolidation” on change of scope of consolidation.
The financial statement is approved and submitted by the Board of Directors on April 28, 2016.
IV. Basis for financial statement preparation
1. Basis for preparation
The Company’s financial statements are prepared based on the assumption of going concern. According to
occurring trades and events, Enterprise Accounting Code-Basic Code issued by the Ministry of Finance, specific
accounting codes, application guide of enterprise accounting code, interpretation of enterprise accounting code and
relevant rules and regulations (hereinafter referred to as “enterprise accounting codes), and No.15 of Information
Disclosure Prepared by Companies Issuing Securities in Public-General Provisions of Financial Statements by China
Securities Regulatory Commission (revised in 2014), the state is prepared.
2. Going concern
The Company is capable of going concern for at least 12 months from the end of the reporting period, and does not
involve key events without affecting going concern.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 49Annual Report 201548
Where the Buyer realizes merging of enterprises not under the same control through several transactions where are of
“package deal”, the Company regards the transactions as one transaction to obtain control right for accounting processing.
Where not of “package deal”, in individual financial statements, the sum of book value of equity investment of the bought
party held before the date of buying and the newly added investment costs on the date of buying is regarded as the initial
investment costs computed according to the cost method; as for other comprehensive earnings confirmed according to
the equity method for the equity investment of the bought party held, when such investment is disposed of, accounting is
processed on the same basis that the invested body’s disposal of relevant assets or liabilities, the owner’s equity confirmed
due to change of the owner’s equity except for net profits and losses, other comprehensive earnings and profit distribution
for the invested party, when such investment is disposed of, it is transferred into current profits and losses of the disposal
period. Of them, the remaining equity after the disposal is accounted in accordance with the cost method or the equity
method as described in the long-term investment code, other comprehensive earnings and other owner’s equity are carried
forward proportionally; where the remaining equity after the disposal is accounted according to the financial instrument
confirmation and measurement code, other comprehensive earnings and other owner’s equity are fully carried forward.
Where the equity investment held before the date of buying is accounted and processed in accordance with the
financial instrument confirmation and measurement code, the sum of fair value of the equity investment and the newly
increased investment cost is regarded as initial investment cost computed with the cost method, and the difference
between fair value of the original equity and cumulative change of fair value of other comprehensive earnings are
transferred into current profits and losses according to the cost method.
6. Preparation method of consolidated financial statements
(1) Principle for determination of scope of consolidated financial statement
The scope of consolidation in the consolidated financial statement is determined based on control. The control
refers to the Company’s power over the invested party, is paid through participating in relevant activities of the
invested party, and capable of affecting the amount paid by applying the power over the invested party. The scope of
consolidation includes the Company and all subsidiaries. The subsidiaries refer to the entities controlled by the Company.
Once relevant factors and conditions result in changes of relevant elements defined by the above control, the
Company appraises again.
(2) Methods for preparing the consolidated financial statements
Based on financial statements of the Company and subsidiaries, according to relevant data, the entire group
regarded as one accounting entity, with reference to confirmation, measurement and listing requirements of relevant
enterprise accounting codes and the same accounting policy and accounting period, the Company reflects overall
financial conditions, business achievement and cash flow of the Group. The merging procedures include: merging
assets, liabilities, owner’s equity, revenue, costs and cash flow of parent company and subsidiaries; offsetting the parent
company’s long-term equity investment on subsidiaries and the parent company’s share in the subsidiaries’ owner equity;
offsetting influences of internal transactions between parent company and subsidiaries and between subsidiaries. Where
internal transactions show that relevant assets are depreciated, such losses are confirmed in full amount; and special
transactions are adjusted in view of enterprise group.
The share of subsidiaries’ owner equity not of the parent company is listed in the “minority shareholders’ equity” in
the owner’s equity of consolidated balance sheet as minority shareholders’ equity.
The share of minority shareholders’ equity in current net profits and losses of subsidiaries is listed in “minority
shareholders’ profits and losses” in net profit of consolidated profit statement. The share of minority shareholders’
equity in current comprehensive proceeds of subsidiaries is listed in “total comprehensive earnings attributed to minority
shareholders” in total comprehensive earnings of the consolidated profit statement.
Where current losses borne by minority shareholders of subsidiaries exceed the share of owner’s equity of the
subsidiary at the beginning of the period, the balance still offsets minority shareholders’ equity.
The unrealized internal transaction profits and losses from subsidiaries’ selling assets are offset with “net profit
attributed to parent company’s owner”. The unrealized internal transaction profits and losses from subsidiaries’ selling
assets to the parent company are offset between “net profit attributed to parent company’s owner” and “minority
shareholders’ profits and losses” according to the parent company’s allocation ratio towards subsidiaries. The unrealized
internal transaction profits and losses from selling assets between subsidiaries are offset between “net profit attributed to
parent company’s owner” and “minority shareholders’ profits and losses” against the seller subsidiary.
V. Key accounting policy and accounting estimate
1. Declaration on being in conformity with enterprise accounting code
The financial statements prepared by the Company are in conformity with requirements of the enterprise accounting
code, and reflect the Company’s financial conditions, business achievements, change of shareholders’ equity and cash
flow completely and authentically.
2. Accounting period
The Company’s accounting period is from solar calendar January 1 to December 31.
3. Business period
The Company’s business period is 12 months.
4. Standard currency for accounting
RMB is the currency of main economic environment where the Company is located. The Company takes RMB as
the standard currency for accounting, and the currency adopted by the Company for preparing the statement is RMB.
5. Accounting process of merging of enterprise under the same control and not under the same control
(1) Merging of enterprises under the same control
Where enterprises involving merging before and after the merging are ultimately controlled by the same party or the
same multiple parties and the control is not temporary, it is regarded as merging of enterprise under the same control.
The date of merging is the date that the merging party acquires control over the merged party.
As for assets and liabilities acquired in enterprise merging, the book value of the consolidated financial statements
of the merged party on the date of merging is measured. Where accounting policies of the merged parties are not
consistent with those of the Company, the merging party adjusts according to the Company’s accounting policy on the
date of merging, and the book value after the adjustment shall be confirmed.
As for difference between book value of net assets acquired in the merging and book value of the merging
consideration paid (or total amount of book value of shares issued), the share capital premium in the capital public reserve
is adjusted; where the share capital premium in the capital public reserve is insufficient to offset, the retained earnings is
adjusted.
Direct relevant costs occurred for enterprise merging, including audit fee, appraisal fee, legal service fee etc. are
accounted into current profits and losses when occurred.
(2) Merging of enterprises not under the same control
Where the parties involving merging are not ultimately controlled by the same party or the same multiple parties
before and after the merging, it is regarded as merging not under the same control.
The buyer’s paid assets, occurred or borne liabilities for merging of enterprises on the date of merging on the date of
buying are measured with fair value. The difference between fair value and the book value is accounted into current profits
and losses. The buyer allocates the costs of merging on the date of buying, and identifies fair values of identifiable assets,
liabilities and contingent liabilities of the bought party on the date of buying. The difference that the cost of merging more
than the fair value of identifiable net assets is confirmed as goodwill.; the difference that the cost of merging is less than the
fair value of identifiable net assets of the bought party is accounted into current profits and losses after reviewing.
Where the deductible temporary difference of the bought party acquired in merging of enterprise is not in conformity
with the confirmation conditions for deferred income tax assets on the date of buying, confirmation is not made. Within
12 months after the date of buying, if new or further information shows that relevant situations on the date of buying
exist and the economic benefits from the deductible temporary difference on the date of buying will be realized, relevant
deferred income tax assets are confirmed, the goodwill is reduced; where the goodwill is insufficient, the difference is
confirmed as current profits and losses; except for the above, the deferred income tax assets related to merging of
enterprises are accounted to current profits and losses.
As for merging of enterprises not under the same control, the buyer’s occurred audit, legal service, appraisal and
consultation and other brokerage fee and other relevant overheads for merging of enterprises are accounted into current
profits and losses when occurred; the transaction costs of equity securities or debt securities issued by the Buyer for
consideration of merging are accounted into initial confirmation amount of the equity securities or debt securities.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 51Annual Report 201550
into joint operation and joint venture. The joint operation refers to the joint operation arrangement that the Company is
entitled to assets related to the arrangement and bears liabilities related to the arrangement. The joint venture refers to the
joint operation arrangement the Company is only entitled to net assets of the arrangement.
The Company’s investment on joint venture is computed according to the equity method. Refer to 14 of Annotation V.
The Company confirms the following items related to interests in joint operation, and applies accounting processing
in accordance with relevant enterprise accounting codes:
(1) Confirm separately held assets, and jointly held assets according to shares;
(2) Confirm separately undertaken liabilities, and jointly undertaken liabilities according to shares;
(3) Confirm income of shares sold jointly operated;
(4) Confirm income from sales according to shares;
(5) Confirm separately incurred costs, and costs of joint operation according to shares.
8. Standard for determination of cash and cash equivalents
When the cash flow statement is prepared, the cash on hand and deposit used to pay from time to time are
confirmed as cash. Cash equivalent refers to investment with short holding period (due within 3 months from buying), high
flexibility and easily converted into known amount and investment with low risks of value change.
9. Foreign currency business and foreign currency statement conversion
(1) Conversion of foreign currency business
In terms of foreign currency business, the spot exchange rate on the date of transaction is used as conversion
exchange rate, and the amount of foreign currency is converted into RMB and accounted.
Balance of monetary items in foreign currency is converted and computed on the date of balance sheet, and
the difference from conversion, except for the difference from special borrowing in foreign currency in conformity with
capitalization conditions processed in accordance with the principle of borrowing cost capitalization, is accounted into
current profits and losses. The non-monetary items in foreign currency measured with history cost are still converted and
computed in accordance with the spot exchange rate on the date of transaction, and the amount of standard currency for
accounting will not be changed. The non-monetary items in foreign currency measured with fair value are computed and
converted in accordance with the spot exchange rate on the date of determination of fair value, and the difference from
conversion arising herefrom is accounted into current profits and losses or other comprehensive earnings.
(2) Conversion of foreign currency statement
The assets and liabilities in the balance sheet are computed and converted in accordance with the spot exchange
rate on the date of balance sheet; in addition to “undistributed profit” in the owner’s equity, other items are computed
and converted in accordance with the spot exchange rate when occurred. The income and cost of profit statement are
computed and converted in accordance with the spot exchange rate on the date of transaction. The difference of foreign
currency financial statement from the above conversion is separately listed in “difference from conversion of foreign
currency statement” in other comprehensive earnings.
When disposing of overseas business, the difference from conversion of foreign currency statement listed in other
comprehensive earnings of balance sheet and related to overseas business is transferred from other comprehensive
earnings to the current profits and losses of disposal; when disposing of partial overseas business, the difference of
foreign currency statement for the part disposed of and is transferred to the current profits and losses for disposal.
10. Financial instruments
Financial instruments include financial assets, financial liabilities and equity instruments.
(1) Classification of financial instruments
According to objectives of holding financial assets and undertaking financial liabilities, the management classifies:
financial assets or financial liabilities measured with fair value and changes into current profits and losses, including
transaction financial assets or financial liabilities and financial assets or financial liabilities measured with fair value and
changes accounted into current profits and losses; held-to-maturity investment; receivables; held-to-maturity financial
assets; and other financial liabilities.
As for newly added subsidiaries and business for merging of enterprises under the same control during the reporting
period, when the consolidated balance statements are prepared, the Company adjusts and consolidates opening amount
of the balance sheet. Revenue, cost and profit of the subsidiaries and business consolidation from the beginning to the
end of the period are taken into the consolidated profit statement, the cash flow is taken into the consolidated cash flow
statement, relevant items of the comparative statement are adjusted, deemed that the reporting entity after the merging
exists from the ultimate controlling party’s control.
As for newly added subsidiaries and business for merging of enterprises or other means not under the same control
during the reporting period, when the consolidated balance sheets are prepared, the Company does not adjust opening
amount of balance sheet, and revenue, cost, profit and cash flow of the subsidiary and from the date of buying to the end
of the reporting period are taken into the consolidated profit statement and the consolidated cash flow statement.
When disposing of subsidiaries and business during the reporting period and preparing the consolidated balance
sheet, the Company does not adjust opening amount of the consolidated balance sheet, revenue, cost and profit of the
subsidiary and from the beginning of the business to the date of disposal are taken into the consolidated profit statement,
and cash flow is taken into the consolidated cash flow statement.
When the parent company buys stock right of the subsidiary owned by minority shareholders of the subsidiary,
in the consolidated financial statements, the Capital reserve (capital premium or share capital premium) is adjusted
according to the difference between the long-term equity investment from buying the minority shareholders; equity and
the net asset share computed from the date of buying or the date of merging according to the newly added shareholding
ratio; where the public capital reserve fund is insufficient, the retained earnings is adjusted.
Where merging of enterprises realized by several transactions and steps and is not of “package deal”, on the date
of obtaining the control, as for the long-term equity investment owned by the merging party before the merging, relevant
profits and losses, other comprehensive earnings and change of owner’s equity are confirmed between the date of
obtaining and the later of date of the merging party and the merged party ultimately under the control of the same party
and the date of merging, and are used to offset the opening retained earnings or the current profits and losses during the
comparative statement periods.
Where enterprises not under the same control are merged through several transactions and steps which are not of
“package deal”, in the consolidated financial statements, as for equity of the bought party before the date of buying, the
equity is re-measured at fair value on the date of buying, and the difference between the fair value and the book value is
accounted into current profits and losses; where the equity of the bought party before the date of buying involves other
comprehensive earnings under the equity method, other comprehensive earnings related herewith is converted into the
current profits and losses on the date of purchasing, except for the other comprehensive earnings from change of net
liabilities or assets by the invested party’s redefining benefit plan.
Where the parent company disposes of long-term equity investment on subsidiaries without losing the control, in the
consolidated financial statements, the Capital reserve (capital premium or share capital premium) is adjusted according to
the difference between the disposal price and the net asset share computed on the date of buying or merging from disposal
of the long-term equity investment; where the Capital reserve is insufficient to offset, the retained earnings is adjusted.
Where losing control over the invested party arising from disposal of partial equity, when the consolidated financial
statement is prepared, the remaining equity is re-measured according to fair value on the date that the control is lost. The
difference that the sum of consideration from disposal of the equity and fair value of the remaining equity minus the share
of net assets of subsidiaries from the date of buying or the date of merging is accounted into current profits and losses
when the control is lost, and goodwill is offset correspondingly. Other comprehensive earnings related to the former
subsidiaries’ equity investment is converted into current investment profits and losses when the control is lost.
Where the control is lost through several transactions and steps, if disposal of subsidiaries’ equity investment until
the control lost is of package deal, the transactions are accounted and processed as one transaction which disposes of
subsidiaries’ equity investment and loses control; however, the difference between disposal price and net asset share
of the subsidiary from disposal of investment is confirmed as other comprehensive earnings in the consolidated financial
statements, and is converted into current profits and losses when the control is lost.
7. Accounting processing for joint venture arrangement and joint operation
The joint venture arrangement refers to one arrangement commonly controlled by two or more participants.
According to rights and obligations in the joint venture arrangement, the Company classifies joint venture arrangement
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 53Annual Report 201552
When judging the financial asset transfer satisfies conditions for termination of the financial assets, the principle of
substance superior to form is adopted. Where the Company classifies financial assets transfer into complete financial
assets transfer and partial financial assets transfer to meet conditions for confirmation, the difference between book value
of the transferred financial assets, and the sum of consideration received from transfer and cumulative amount of change
of fair value formerly accounted into other comprehensive earnings is accounted into current profits and losses. Where
partial financial assets transfer satisfies the confirmation conditions of termination, the book value of the transferred
financial assets is amortized according to relative fair value between termination confirmation and not termination
confirmation, and difference between the sum of consideration received form transfer and cumulative amount of fair value
of formerly accounted into other comprehensive earnings amortized to the termination confirmation and the amortized
book value is accounted into current profits and losses.
Where the financial asset transfer does not satisfy the termination confirmation conditions, continue to confirm the
financial assets, and the consideration received is confirmed as one financial liabilities.
(4) Conditions for termination confirmation of financial liabilities
Where present obligations of financial liabilities have been completely or partially released, the financial liabilities or
any part here are confirmed for termination; if the Company signs agreement with creditors and the Company undertakes
new financial liabilities with the existing financial liabilities, and terms and conditions of the new financial liabilities and the
existing financial liabilities are different, the existing financial liabilities are confirmed for termination, and the new financial
liabilities are confirmed for termination.
Where complete or partial terms and conditions of the existing financial liabilities are substantially modified, the
existing financial liabilities are confirmed for termination, and the financial liabilities after terms and conditions after
modifying are confirmed as one new financial liabilities.
When the financial liabilities are completely or partially confirmed for termination, the difference between the book
value for the financial liabilities confirmed for termination and the consideration paid (including the transferred-out non-
cash assets or the undertaken new financial liabilities) is accounted into current profits and losses.
Where partial financial liabilities are bought back, based on relative fair value between the continuing confirmation
and the terminated confirmation on the date of buyback, complete book value of the financial liabilities is assigned. The
difference between the book value assigned to the termination and the consideration paid (including transferred-out non-
cash assets or undertaken new financial liabilities) is accounted into current profits and losses.
(5) Determination of fair values of financial assets and financial liabilities
As for financial instruments with active market, the fair value is determined in accordance with quotation on active
market. As for financial instruments without active market, the appraisal technology is used to determine the fair value.
When appraisal is conducted, the Company adopts the appraisal technology applicable under current situations with
sufficient utilizable data and other information, selects input values the same with assets or liabilities features in relevant
assets or liabilities transaction by market participants, and use the observable input values in priority. The non-observable
input values are used when the observable input values cannot be obtained or unfeasible.
(6) Depreciation of financial assets (exclusive of receivables)
Except financial assets measured with fair value and changes accounted into current profits and losses, book value
of the financial assets is checked on the date of balance sheet. If objective evidences show that some financial assets
have been depreciated, the depreciation reserve is accrued.
① Depreciation of held-to-maturity investment, goods payment and receivables
The book value of financial assets measured with costs or amortized costs is written down to present value of the
future cash flow, and the written-down amount is confirmed as depreciation losses and is accounted into current profits
and losses. After depreciation losses are confirmed for financial assets, if objective evidences show that values of the
financial values have been recovered, which is related to events after the losses, the originally confirmed depreciation
losses are recovered, and the book value of financial assets after the depreciation losses have been recovered is no more
than the amortized costs of the financial assets on the date of recovery without depreciation reserve accrual.
② Depreciation of available-for-sale financial assets
Combined with relevant comprehensive factors, if drop of fair value of the available-for-sale equity instrument
investment is serious or is not temporary, the available-for-sale financial assets are depreciated, and the cumulative
losses from dropping of failure value of originally accounted into other comprehensive earnings are transferred out and
(2) Confirmation basis and measurement method of financial instruments
① Financial assets (financial liabilities) measured with fair value and changes into current profits and losses
When acquired, the fair value (the declared but not issued cash dividend or the bond interest due but not withdrawn
deducted) is taken as initially confirmed amount, and relevant transaction costs are accounted into current profits and
losses.
Interest or cash dividend acquired during the holding period is confirmed as interest earnings, and change of fair
value is accounted into current profits and losses.
When disposed of, the difference between fair value and the initial accounting amount is confirmed as investment
earnings, and profits and losses from change of fair value is adjusted.
② Held-to-maturity investment
When acquired, the sum of fair value (bond interest due but not withdrawn deducted) and relevant transaction costs
are taken as initially confirmed amount.
During the holding period, interest income is computed according to amortization costs and actual interest rate.
The actual interest rate is determined when acquired, and remains in the estimated holding period or applicable shorter
period.
When disposed of, the difference between the price acquired and the book value of the investment is accounted
into investment earnings.
As for held-to-maturity investment sold or reclassified before the due date, the remaining part of the investment is
reclassified as available-for-sale financial assets, and any financial assets will not be classified as held-to-maturity in the
accounting period or the following 2 complete accounting years, except: the date of selling or reclassifying is closer to
the due date or redemption date of the investment (such as within 3 months when due), and change of market interest
rate has no significant influences on fair value of the investment; according to the periodic repayment or repayment in
advance as described in the Contract, almost all initial principals of the investment have been recovered, and the remains
is sold or reclassified; the selling or reclassifying is caused by standalone events beyond the control of the enterprise, not
reoccurring or difficult to be expected.
③ Receivables
The receivable creditor’s right from selling commodity or providing labor, and the creditor’s right of debt instruments
of enterprises not including the creditor’s right with quotation on active market, including receivables and other
receivables, and the price in the contract or agreement receivable from the purchaser is taken as the initially confirmed
amount; if the nature of financing exists, the present value is used to confirm.
When recovered or disposed of, the difference between the price acquired and the book value of the receivable is
accounted into current profits and losses.
④ Available-for-sale financial assets
When acquired, the sum of fair value (cash dividend declared but not issued or the bond interest due but not
withdrawn) and relevant transaction costs are taken as the initially confirmed amount.
The interest or cash dividend acquired during the holding period is confirmed as investment earnings. At the end of
the period, it is measured with fair value and changes of the fair value are accounted into other comprehensive earnings.
As for equity investment without control, common control over or significant influences on the invested party, without
quotation on active market and fair value not measured reliably, the equity investment is listed as available-for-sale
financial assets, and is subsequently measured according to costs.
When disposed of, the difference between the price acquired and the book value of the financial assets is
accounted into investment profits and losses; meanwhile, the disposal amount of cumulative amount from change of fair
value of other comprehensive earnings is transferred out and accounted into investment profits and losses.
⑤ Other financial liabilities
The sum of fair value and relevant transaction acts is taken as initially confirmed amount. Subsequent measurement
is carried out based on amortization costs.
(3) Confirmation basis and measurement methods of financial assets transfer
When financial assets are transferred, if almost all risks and remunerations on title of the financial assets have been
transferred to the transferred party, termination of the financial assets is confirmed; if almost all risks and remuneration of
title of the financial assets are retained, termination of the financial assets is not confirmed.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 55Annual Report 201554
Of the combination, the non-performing debt is accrued according to the debt age analysis method.
√ Applicable □ Not applicable
Debt age Accrual ratio of receivables (%) Accrual ratio of other receivables (%)
Within 1 year (included) 5 5
1-2 years 20 20
2-3 years 20 20
More than 3 years 50 50
Of the combinations, non-performing debt reserve is accrued according to the balance percentage method:
√ Applicable □ Not applicable
Combination Accrual ratio of receivables (%) Accrual ratio of other receivables (%)
Financing and leasing equipment
accounts receivable
20% of amount more than 1 month
overdue
Of the combinations, non-performing debt reserve is accrued according to other methods:
√ Applicable □ Not applicable
Combination Accrual ratio of receivables (%) Accrual ratio of other receivables (%)
Goods payment of subsidiaries 0 0
Refunding of tax 0 0
Bidding security 0 0
Current accounts of subsidiaries 0 0
(3).Receivables with insignificant single amount and non-performing debt reserve accrued separately
Causes for accruing non-performing debt reserve separately Insignificant single amount but the debt age analysis
method cannot reflect the risk features.
Accrual method of non-performing debt
The non-performing debt reserve is accrued in
accordance with the difference that the cash flow
present value in the future lower than the book value.
12. Stock
(1) Classification of stock
Stock is classified into six categories such as raw materials, low-value consumables, packages, goods in process,
finished products and shipped commodity.
(2) Pricing of stock
The stock is initially measured with the cost of acquiring, including purchasing cost, processing cost and other
costs. Pricing of withdrawing raw materials and shipping commodity is measured with the weighted average method;
(3) Basis for determination of realizable net value of inventory and accrual method of Stock revaluation reserve
At the end of the period, after the stock has been checked, the Stock revaluation reserve is accrued or adjusted in
accordance with the inventory cost and realizable net value, which is lower.
As for commodity stocks such as finished product, stock commodity and materials directly used for selling, in the
process of regular production and operation, the realizable net value is determined in accordance with estimated sales
price of the stock minus the estimated Sales expenseand relevant taxes; as for material stock to be processed, in regular
production and operation, the realizable net value is determined in accordance with estimated sales cost minus the
occurred costs, estimated sales cost and relevant taxes; realizable net value of stock held for executing sales contract or
labor contract is computed in accordance with the contract price; if the stock quantity is more than the quantity ordered
in the sales contract, net realizable value of stock beyond the quantity in the contract is computed in accordance with the
general sales price.
Stock revaluation reserve is accrued for single stock items at the end of the period; as for stock with excessive
quantity and low price, the stock accrual reserve is accrued according to types of the stock; as for stock related to
are accounted into current profits and losses. The transferred-out cumulative losses are the initial cost for acquiring
the assets minus the principal recovered, the amortized amount, current fair value and depreciation losses formerly
accounted into profits and losses. After depreciation losses have been confirmed, if objective evidences show that value
of the financial assets have been recovered and it is objectively related to events after the losses, the formerly confirmed
depreciation losses are recovered and confirmed as other comprehensive earnings, and depreciation losses of the
available-for-sale debt instruments are recovered and accounted into current profits and losses.
Depreciation losses of equity instrument investment without quotation on active market and its fair value not
measured reliably, or the derivative financial assets related to the equity instruments and settled through delivering the
equity instruments will not be recovered.
11. Receivables
(1). Receivable with single significant amount and non-performing debt accrued separately
Judgment basis or amount standard for
single significant amount Receivable of more than 3 million yuan as closing balance
Accrual method for single significant
amount and single non-performing debt
If objective evidences show that depreciation occurs, according to
the difference that present value of the future cash flow lower than the
book value, separate depreciation testing shall be carried out, and non-
performing debt reserve is accrued.
(2). Receivables with non-performing debt accrued according to credit risk feature combination
As for receivable with insignificant amount, the non-depreciated receivables after testing shall be classified into
several combinations based on credit risk features, based on actual loss rates of receivable account combination of the
same or similar credit risk features in the past and combined with current situations, the ratio of non-performing debt
reserve is accrued as follows. The basis for determination of combinations:
Combination Basis
Accounts receivable
Accounts of financing and leasing equipment receivables Type of sales contract
Subsidiaries’ goods payment Type of sales contract
Other ordinary customers Type of sales contract
Other receivables
Refunding of tax Nature of receivables
Bidding security Nature of receivables
Current accounts of subsidiaries Nature of receivables
Other current accounts Nature of receivables
Collective accrual of non-performing debt reserve based on portfolio
Portfolio Withdrawal method
Receivables
Accounts of financing and leasing equipment receivables overdue Balance percentage method
Goods payment of subsidiaries Other methods
Other ordinary clients Debt age analysis method
Other receivables
Refunding of tax Other methods
Bidding security Other methods
Current accounts of subsidiaries Other methods
Other current accounts Debt age analysis method
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 57Annual Report 201556
② Long-term equity investment acquired via other forms
As for the long-term equity investment acquired through cash payment, the actually paid price is taken as the initial
investment costs. The initial investment costs include costs, taxes and other necessary expenditures directly related to
acquiring the long-term equity investment.
As for the long-term equity investment acquired through issuing equity securities, fair value of the issued equity
securities is taken as the initial investment cost.
Under the prerequisites of the non-monetary asset swap with business nature or fair value of the swap-in and swap-
out assets reliably measured, as for the swap-in long-term equity investment of non-monetary assets, fair value of the
swap-out asset is determined as the initial investment cost, unless definitive evidences show that fair value of the swap-
in assets is more reliable; as for non-monetary asset swap not satisfying the above prerequisites, the book value of swap-
out asset and the payable taxes are used as the initial investment cost of the long-term equity investment.
As for long-term equity investment acquired through debt reconstruction, the initial investment cost is determined
according to the fair value.
(2) Subsequent measurement and profit and losses confirmation of long-term equity investment
The Company applies the cost method to computing the long-term equity investment of the invested body
controlled by the Company.
The long-term equity investment computed in accordance with the cost method is priced based on the initial
investment costs. If investment is added or recovered, cost of the long-term equity investment is adjusted. Cash dividend
or profit declared and issued by the invested body is confirmed as current profits and losses.
The long-term equity investment for joint venture and cooperative enterprise is computed in accordance with
the equity method. When the initial investment cost is more than the investment, the difference of fair value shares of
identifiable net assets of the invested body is vested, and initial investment cost of the long-term equity investment is not
adjusted; when the initial investment cost is less than the investment, the difference of fair value shares of identifiable net
assets of the invested body is vested and is accounted into current profits and losses, and costs of the long-term equity
investment are adjusted.
After acquiring the long-term equity investment, the Company confirms investment earnings and other
comprehensive earnings in accordance with shares of net profits and losses and other comprehensive earnings realized
by the invested body to be vested or undertaken, and book value of the long-term equity investment is adjusted; the
Company reduces book value of the long-term equity investment in accordance with the portion of profit or cash dividend
declared and issued by the invested body; the Company adjusts book value of the long-term equity investment and
accounts it into owner’s equity against changes of owner’s equity of the invested body except net profits and losses,
other comprehensive earnings and profit distribution.
When confirming shares of net profits and losses of the invested body, based on fair value of identifiable net assets
of the invested body when the investment is acquired, the Company adjusts net profit of the invested body and confirm.
Where the accounting policy and accounting period adopted by the invested body are not the same with those of
the Company, the financial statements of the invested body are adjusted in accordance with the Company’s accounting
policy and accounting period, and the investment earnings and other comprehensive earnings are confirmed hereby.
As for net losses of the invested body confirmed, the Company writes down book value of the long-term equity
investment and long-term equity substantially constituting net investment on the invested body to zero as limit, unless the
Company assumes obligations of extra losses.
Where the invested body realizes net profits in the future, after the earnings share compensate unconfirmed loss
shares, the Company recovers and confirms the earnings share.
When the Company confirms net profits and losses of the invested body to be vested or undertaken, the profits and
losses of unrealized internal transactions with cooperative enterprises and joint ventures shall be offset in accordance with
the part attributed to the Company based on the shares, and the investment earnings are confirmed hereby.
As for losses of unrealized internal transactions between the Company and the invested body, where the losses are
of Asset impairment losses in accordance with the Enterprise Accounting Code No.8-Asset Depreciation, the transaction
losses in full amount are confirmed.
Where the Company applies significant influences on the invested body or applies common control over the
invested body because of increasing investment and other causes but does not constitute control, the fair value of equity
products series produced and sold in the same area, with the same or similar use or objective and not easily identified
from other items, the Stock revaluation reserve is accrued in combination.
(4) Inventory system of the stock
The perpetual inventory system is adopted.
(5) Amortization methods of low-value consumables and packages
① One-off charge-off method is applied to low-value consumables.
② One-off charge-off method is applied to packages.
13. Classified as available-for-sale assets
Compositions of the enterprise (or non-current assets, the same below) satisfying the following conditions
simultaneously are confirmed as available-for-sale assets: the compositions can be sold under the existing conditions
and in accordance with ordinary terms and conditions for sales of such assets; the enterprise has made resolutions on
disposal of the compositions, if approval by shareholders is needed, and approval by shareholders’ assembly or the
competent power body is required; the enterprise has signed an irrevocable transfer agreement with the transferred party;
and the transfer will be finished in one year.
14. Long-term equity investment
The long-term equity investment refers to the long-term equity investment that the Company’s controlling, jointly
controlling or applying significant influences on the invested body. As for long-term equity investment not controlling, joint
controlling or applying significant influences on the invested body, the Company takes it as available-for-sale financial
assets or the financial assets measured with fair value with changes accounted into current profits and losses. Refer to
Annotation IV. 10 “Financial Instruments” in the accounting policy.
Common control refers to control co-owned over some arrangement by the Company in accordance with relevant
rules and regulations, and relevant activities of the arrangement shall be determined with consent obtained from the other
party sharing the control. Significant influences refer to the power that the Company has the power to make decisions on
financial and operational policy of the invested body, and cannot constitute common control or control with other parties.
(1) Determination of initial cost of long-term equity investment
① Long-term equity investment by enterprise merging
Merging of enterprises under the same control: where the Company pays cash, transfers non-cash assets or
undertake liabilities and issues equity securities as the merging consideration, on the date of merging, the share of
book value in the consolidated financial statement of the ultimate control party of the merged party is used as the initial
investment cost of the long-term equity investment. The Capital reserve (capital premium or share capital premium) is
adjusted in accordance with the difference between the initial investment cost and the merging consideration paid of the
long-term equity investment; where the Capital reserve (capital premium or share capital premium) is insufficient to offset,
the retained earnings is adjusted. Where the merging party takes the issued equity bonds as the merging consideration,
total book value of the issued shares as share capital, the Capital reserve (capital premium or share capital premium) is
adjusted in accordance with the difference between initial investment cost of the long-term equity investment and total
book value of the issued shares; where the Capital reserve (capital premium or share capital premium) is insufficient to
offset, the retained earnings is adjusted.
Merging of enterprises not under the same control: the Company takes the merging cost determined on the date
of purchasing as the initial investment cost of the long-term equity investment. The merging cost is the purchaser’s
paid assets, occurred or undertaken liabilities and fair value of the issued equity securities to obtain control over the
purchased party on the date of merging. The purchaser takes transaction costs of equity securities or debt securities
issued as merging consideration and accounts into initially confirmed amount of equity securities or debt securities. As for
merging of enterprises not under the same control merged by several transactions and steps, the sum of book value of
the purchased party’s equity investment before the date of purchasing and the newly increased investment on the date of
purchasing is taken as initial investment cost of the investment. The Company takes contingent consideration described
in the merging contract as a part of transferred consideration in enterprise merging, and accounts fair value into merging
cost of the enterprise on the date of purchasing.
Audit, legal service, appraisal, consultation and other brokerage services and other relevant overheads occurred by
the merging party or the purchaser for enterprise merging are accounted into current profits and losses when occurred.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 59Annual Report 201558
Type Depreciation method Depreciation
term (years)
Ratio of remaining
value (%)
Annual depreciation
rate (%)
Building and property Straight-line method 20-40 5.00 2.40-4.80
Machines and equipment Straight-line method 8-15 5.00 6.33-11.88
Electronic equipment Straight-line method 5 5.00 19.00
Transporting equipment Straight-line method 3-8 5.00 11.87-31.7
Other equipment Straight-line method 2 None 50.00
(3). Depreciation testing of fixed assets and accrual method of depreciation reserve
Refer to Annotation V 20 “Long-term asset depreciation” on depreciation testing method of fixed assets and accrual
methods of depreciation reserve.
(4). Evidence confirmation, pricing and depreciation methods of fixed assets leased with financing
Where terms and conditions of the leasing agreement signed by the Company and the lessor satisfy one of the
following conditions, the leased assets with financing are confirmed:
① Upon expiry of the leasing period, ownership of the leased assets belongs to the Company;
② The Company has the option to purchase the assets, and the purchasing price is much lower than the fair value
of the asset when the option is exercised;
③ The leasing period accounts for most of service life of the leased assets;
④ The minimum present value of leasing payment from the date of leasing does not vary a lot from fair value of the
assets.
From the date of leasing, fair value of the leased assets or the minimum present value of leasing payment is taken
as the accounting value of the leased assets, which is lower, the minimum present value of leasing payment is taken as
accounting value of long-term payable, and the difference is taken as unconfirmed financing costs.
As for fixed assets leased through financing and leasing, where ownership of the leased assets can be obtained
upon expiry of the leasing period as appropriately, depreciation is accrued in the usable period of the leased assets;
where ownership of the leased assets cannot be obtained upon expiry of the leasing period, depreciation is accrued in the
leasing period or the usable period of the leasing period, which is shorter.
17. Projects under construction
Projects under construction are computed according to the established projects.
Costs of projects under construction are determined in accordance with the actual project expenditures, including
expenditures during the period of construction, borrowing costs of capitalization before the project reaches the usable
conditions and other relevant costs. After reaching the usable conditions, the projects under construction are converted
into fixed assets.
Refer to Annotation V. 20 “Long-term asset depreciation” on depreciation testing methods and depreciation reserve
accrual for projects under construction.
18. Borrowing costs
(1) Principle for confirmation of capitalization of borrowing costs
The borrowing costs include borrowing interest, amortization of depreciation or premium, auxiliary expenses and
balance of exchange from foreign currency borrowing etc.
The Company’s borrowing costs, where directly attributed to asset building or production qualified for capitalization,
shall be capitalized and accounted into relevant asset costs; other borrowing costs are confirmed as costs according to
amount occurred and are accounted into current profits and losses.
The assets qualified for capitalization refer to pre-determined usable or sellable fixed assets, investment property
and stock after very long building or production activities.
Borrowing costs are capitalized when the following conditions are satisfied simultaneously:
① Asset expenses occurred, including cash paid, non-cash assets transferred or expenses assumed for bearing
interest-bearing debts for building or producing assets qualified for capitalization;
② Borrowing costs occurred;
③The necessary building or production activities enabling assets to reach usable or sellable conditions have
commenced.
investment held in accordance with the Enterprise Accounting Code No.22-Confirmation and Measurement of Financial
Instruments with the cost of newly increased investment is used as the initial investment cost computed in accordance
with the equity method. Where the formerly held equity investment is classified as available-for-sale financial assets, the
difference between the book value and the fair value, and changes of cumulative fair value formerly accounted into other
comprehensive earnings are accounted into current profits and losses computed with the equity method.
Where the Company loses common control over or applies significant influences on the invested body because
of disposing of partial equity investment, the remaining equity after the disposal is computed in accordance with
the Enterprise Accounting Code No.22-Confirmation and Measurement of Financial Instruments, and the difference
between fair value on the date of losing common control or being affected by significant influences and the book value
is accounted into current profits and losses. As for other comprehensive earnings confirmed for the former equity
investment in accordance with the equity method, when computing with the equity method is terminated, the basis the
same with the assets or liabilities disposed of by the invested body is used for accounting and processing.
Where the Company loses control over the invested body because of disposing of partial equity investment, when
preparing individual financial statements, where the remaining equity after the disposal applies common control over or
significant influences on the invested body, the equity method is used to compute, and the remaining equity is adjusted
according to the equity method when acquired; where the remaining equity cannot apply common control over or
significant influences on the invested body, accounting and process are conducted in accordance with the Enterprise
Accounting Code No.22-Confirmation and Measurement of Financial Instruments.
As for disposal of long-term equity investment, the difference between book value and the price acquired is
accounted into current profits and losses. As for long-term equity investment computed according to the equity method,
when such investment is disposed of, with the same basis of assets or liabilities of the invested body, the part originally
accounted into other comprehensive earnings based on corresponding ratio shall be accounted and processed.
15. Investment property
The Company’s investment property includes leased land use right, land use right held and to be transferred after
value is added and leased buildings. When the Company can acquire rent income or value-added proceeds related to the
investment property and cost of the investment property can be measured reliably, the Company confirms according to
actual expenditures of purchasing or building.
The Company adopts cost mode for following-up measurement for subsequent expenditures of the investment
property. As for investment property, depreciation or amortization is accrued according to accounting policy of fixed
assets or intangible assets of the Company. When the Company changes application of investment property, if it is for
self-use, relevant investment property is transferred into other assets.
Refer to Annotation V 20 “Long-term Asset Depreciation” on depreciation testing and depreciation reserve accrual
of the investment property.
16. Fixed assets
(1). Confirmation conditions
Fixed assets refer to tangible assets held for producing commodity, providing labor, leasing or business
management with service life of more than one accounting year. The fixed assets include: property and building,
machines and equipment, electronic equipment, transporting equipment and other equipment. The fixed assets are
confirmed when the following conditions are satisfied:①Economic benefits related to the fixed assets probably flow into
the enterprise;②The cost of the fixed assets can be measured reliably.
(2). Depreciation method
Depreciation of fixed assets is accrued according to the Straight-line method, and depreciation rate is determined
according to fixed asset types, estimated service life and estimated net remaining value rate. If compositions of the
fixed assets are different or provide enterprises with economic benefits in various forms, different depreciation rates or
depreciation methods are selected, and depreciations are accrued.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 61Annual Report 201560
② Subsequent measurement
The service life is analyzed and judged when intangible assets are acquired.
As for intangible with limited service life, the intangible assets are amortized with the linearity method with the period
of benefiting the enterprise; where the period of benefiting the enterprise by the intangible assets cannot be estimated,
the intangible assets are deemed as assets with uncertain service life and will not be amortized.
(2) Estimate of service life of intangible assets with limited service life
Type Number of years of amortization (years)
Land use right 50
Trademark right 10
Patent right 10
Non-patented technology 5
Application software 5
At the end of each period, service life and amortization method of intangible assets with limited service life are
double checked.
(3) Standards for classifying research stage and development stage of internal research and development
projects
Expenses of internal research and development are classified into expenses of the research stage and expenses of
the development stage.
Research stage: unique and planning survey and research activities for acquiring and understanding new science or
technical knowledge.
Development stage: before commercial production or use, the research achievements or other knowledge is applied
a program or design to produce new or substantially improved materials, devices and products etc.
(4) Standards for expenses of development stage qualified for capitalizing
Expenses of development stage of internal research and development projects are confirmed as intangible
expenses when the following conditions are satisfied:
① Completing the intangible assets to make it technically feasible in terms of use or sales;
② The intention of completing the intangible assets for use or sales;
③ The modes of producing economic benefits by the intangible assets, including proving the products by the
intangible assets marketable or the intangible assets marketable, or usefulness of the intangible assets if used internally;
④ Sufficient technical, financial resources and other resources support to complete development of the intangible
assets, and be capable of using or selling the intangible assets;
⑤ Expenses attributed to development stage of the intangible assets are reliably measured.
Expenses of the development stage, where not satisfying the above conditions, are accounted into current profits
and losses when occurred. Expenses of the research stage are accounted into current profits and losses when occurred.
(5) Refer to Annotation V. 20 “Long-term asset depreciation” on depreciation testing and depreciation
reserve accrual of the intangible assets.
20. Long-term assets depreciation
On each date of balance sheet, judge whether the long-term equity investment, investment property measured
with cost mode, fixed assets and project under construction , biological assets measured with cost mode and intangible
assets with definite service life of oil and gas are depreciated or not. Where depreciation exists, estimate the amount
recoverable, when the amount recoverable is lower than the book value, book value of the asset is written down to the
amount recoverable, the amount written down is confirmed as corresponding depreciation losses and is accounted into
current profits and losses, and corresponding depreciation reserve is accrued.
Estimate of amount recoverable of the assets is determined in accordance with the net amount that fair value
minus the disposal cost, or the present value of cash flow in the future, which is higher. The enterprise estimates amount
recoverable based on single asset. Under the conditions of being difficult to estimate amount recoverable of single asset,
the enterprise estimates the amount recoverable of asset portfolio which the asset belongs to.
(2) Capitalization period of borrowing costs
The capitalization period refers to the period starting from capitalizing to stop capitalizing, and the period of
borrowing cost suspension is excluded.
When assets built or produced qualified for capitalizing reach the pre-determined usable or sellable conditions,
capitalization of the borrowing costs is stopped.
When partial projects of assets built or produced qualified for capitalization are completed and can be used
separately, capitalization of borrowing costs of the assets is stopped.
Where the parts of building or producing the assets are completed respectively and can be used or sold after
complete completion, capitalization of borrowing costs is stopped when the assets are completed completely.
(3) The period of suspending capitalization of borrowing costs
Where assets qualified for capitalization are interrupted unusually in the process of building or producing and the
interruption is more than 3 months, capitalization of borrowing costs is suspended; if such suspension is the required
procedures for the assets built or produced qualified for capitalization to reach the pre-determined usable conditions
or sellable conditions, continue capitalizing of borrowing costs. The borrowing costs during the interruption period are
confirmed as current profits and losses until building or producing of assets resumes, and continue capitalizing.
(4) Computing amount of capitalizing amount of borrowing costs
As for special borrowing borrowed for building or producing assets qualified for capitalizing, the amount that the
actually amount and its auxiliary expenses occurred in the current period minus the interest income or investment earnings
from temporary investment for the unused borrowed fund is used to determine capitalizing amount of borrowing costs.
As for general borrowing occupied for building or producing assets qualified for capitalization, amount of interest of
general borrowing to be capitalization is determined in accordance with the weighted average value that the cumulative
asset expenses more than the special borrowing multiplying by capitalization rate of general borrowing. The capitalizing
rate is determined in accordance with weighted average interest rate of general borrowing.
Where there is depreciation or premium of borrowing, depreciation or premium amount to be amortized in each
accounting period is determined according to the actual interest rate method, and amount of interest in each period is
adjusted.
19. Intangible assets
(1) Pricing of intangible assets
① The intangible assets are initially measured according to costs
The costs of purchasing intangible assets include purchasing price, relevant costs and other expenses directly
attributed to the assets to realize the pre-determined application. Where the price of purchasing intangible assets is
paid in delay out of the regular credit conditions and is of nature of financing, the cost of intangible assets is determined
according to present value of the purchasing price.
As for intangible assets acquired from the debtors to pay the debt in debt reconstruction, fair value of the intangible
assets is determined as accounting value, and the difference between book value of the reconstruction debt and the fair
value of the intangible assets used to pay the debt is accounted into current profits and losses.
Under the prerequisite of the non-monetary asset swap of business nature and fair value of swap-in or swap-out
assets measured reliably, accounting value of the non-monetary swap-in intangible assets is determined according to fair
value of the swap-out assets, unless definitive evidences show that fair value of the swap-in assets is more reliable; as for
non-monetary asset swap not satisfying the above prerequisites, book value of swap-out assets and payable taxes are
taken as cost of the swap-in intangible assets and is not confirmed as profits and losses.
Accounting value of the intangible assets acquired from assimilation and merging of enterprises under the same
control is determined according to book value of the merged party; accounting value of the intangible assets acquired
from assimilation and merging of enterprises not under the same control is determined according to fair value.
As for internal independently developed intangible assets, the costs include: materials consumed for developing
the intangible assets, labor costs, registration fees, amortization of patent right and franchised right used in the process
of development, interest cost satisfying capitalization conditions, and other direct costs enabling the intangible assets to
reach the pre-determined application.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 63Annual Report 201562
assets refers to present value of economic benefits acquired from the amount deposited refunded or reduced from the
defined benefit plan.
At the end of the reporting period, service costs of the staff remuneration costs produced in the defined benefit
plan and the net amount of interest of net liabilities or net assets in the defined benefit plan are accounted into current
losses and profits or asset costs; changes of net liabilities or net assets of the defined benefit plan is re-measured and is
accounted into other comprehensive earnings, will not be recovered to profits and losses in the following-up accounting
period and can be transferred within the scope of equity.
Under the defined benefit plan, the past service costs are confirmed as current costs on the date of confirmation of
reconstruction costs or resignation material benefits for modifying the defined benefit plan, which is earlier.
The enterprise confirms settlement gains or losses in the defined benefit plan settlement. The gains or losses are the
differences of obligatory present value and settlement price of the defined benefit plan on the date of settlement.
(3) Accounting processing of dismissal material benefits
The liabilities of staff remuneration from the resignation material benefits are confirmed under the following two
circumstances, which is earlier, and are accounted into current profits and losses;
When the Enterprise cannot cancel the provided dismissal material benefits because of canceling the labor relations
or the cutoff suggestions;
When the Enterprise confirms relevant costs related to reconstruction of resignation material benefits.
Where the dismissal material benefits will be completely paid within 12 months after expiry of the annual reporting
period, relevant provisions on short-term remuneration are applied; where the dismissal material benefits cannot be paid
within 12 months after expiry of the annual reporting period, relevant provisions on long-term material benefits are applied.
(4) Accounting processing of other long-term staff remuneration
In terms of other long-term staff material benefits, where the defined contribution plan conditions are satisfied, the
clause 2 above is applied. Where the defined contribution plan is not satisfied, relevant provisions on the defined benefit
plan are applied, and net liabilities or net assets of other long-term staff material benefits are confirmed or measured.
At the end of the reporting period, service cost, net amount of net liabilities or net assets in the long-term staff material
benefits, and total net amount from change of re-measurement of net liabilities or net assets of the long-term staff
material benefits is accounted into current profits or losses or relevant assets costs.
23. Estimated liabilities
The actual obligations assumed by the Company because of providing guarantee, litigation, product quality assurance
and loss contract and other contingencies and exercising the obligations may result in economic benefits flowing out of
the Company and when the amount of the obligation can be measured reliably, the Company confirms such obligations as
estimated liabilities. The Company performs initial measurement of estimated liabilities according to the optimal estimate for
performing the actual obligations, and checks book value of the estimated liabilities on the date of balance sheet.
24. Payment of shares
(1) Type and accounting process of payment of shares
The payment of shares is the equity instruments granted or the transaction of liabilities based on the equity
instruments to acquire the staff’s service for the Company. The payment of shares is the payment of shares settled with
equity and the payment of shares settled with cash.
① Payment of shares with equity settlement
The stock option plan is the payment of shares settled with equity exchange for services provided by the staff,
and is measured with fair value of the equity instruments granted to the staff on the date of granting. The options are
exercised when services complete the waiting period or reach the specified conditions, the optimal estimate of the
exercisable equity instruments within the waiting period is taken as the basis, and fair value of the equity instruments is
accounted into relevant costs for the service acquired and the corresponding public reserve fund is added.
② Payment of shares with cash settlement
The stock value-added plan is the payment of shares settled with cash, and is measured with fair value of liabilities
determined in accordance with quantity of stock assumed by the Company. The payment of shares can be exercised
after the services complete the waiting period or satisfy the performance conditions. On each date of balance sheet within
the waiting period, based on optimal estimate of exercisable options, according to fair value of liabilities assumed by the
After the asset depreciation loss have been confirmed, depreciation or amortization costs of the depreciated assets
are adjusted in the future. In the remaining service life of the assets, book value of the assets is amortized systematically.
As for intangible assets with uncertain service life, intangible assets not reaching the usable conditions and goodwill
by merging, depreciation testing shall be carried out at the end of each year.
In terms of goodwill depreciation testing, the book value of goodwill from enterprise emerging is amortized to
relevant asset portfolio with reasonable methods; where the book value cannot be amortized to relevant asset portfolio,
the book value is amortized to relevant asset portfolio combinations. When book value of goodwill is amortized to relevant
asset portfolio or asset portfolio combination, amortization is made according to ratio of fair value of asset portfolio or
asset portfolio combination to total fair value of relevant asset portfolio or asset portfolio combination. Where fair value
cannot be measured reliably, amortization is made in accordance with ratio of book value of asset portfolio or asset
portfolio combination to total book value of relevant asset portfolio or asset portfolio combination.
When depreciation testing is carried out for asset portfolio or asset portfolio combination including goodwill, where
the asset portfolio or asset portfolio related to goodwill is depreciated, depreciation testing is made for asset portfolio or
asset portfolio combination exclusive of goodwill, amount recoverable is computed, comparison is made with the book
value, and corresponding depreciation losses are confirmed. Depreciation testing is made for asset portfolio or asset
portfolio combination including goodwill, book value (including book value of the amortized goodwill) of relevant asset
portfolio or asset portfolio combination and the amount recoverable are compared, if amount recoverable of relevant
asset portfolio or portfolio combination is lower than the book value, and depreciation losses of goodwill is confirmed.
Once the above Asset impairment losses have been confirmed, the amount of recovering the value will not be
recovered in the future.
21. Long-term costs to be amortized
As for costs occurred to be assumed in the period and future with period of amortization more than 1 year, including
improvement expenses for leased fixed assets for business, the costs are amortized as long-term costs to be amortized
according to the beneficial period. Where the long-term costs to be amortized cannot benefit the following accounting
years, the remaining values not amortized are transferred into current profits and losses.
22. Staff remuneration
The staff remuneration refers to various remuneration or compensation provided to obtain services provided by
the staff or canceling the labor relations, including short-term remuneration, post-resignation material benefits, dismiss
material benefits and other long-term staff material benefits.
(1) Accounting processing of short-term remuneration
During the accounting period that the staff serves the Company, the actually occurred short-term remuneration is
confirmed as liabilities, and is accounted into current profits or losses and relevant asset costs.
(2) Accounting processing of post-resignation material benefits
The post-resignation material benefits plan is classified into defined contribution plan and defined benefit plan.
During the period that the staff provides services to the Company, the amount deposited computed in accordance
with the defined contribution plan is confirmed as liabilities and is accounted into current profits or losses or relevant asset
costs. In accordance with the defined contribution plan, where all amount deposited will not be paid within 12 months
after expiry of the annual report period which the staff provide service, in accordance with market earnings rate of national
debt or high-quality corporate bonds on active market matching the defined benefit plan on the date of balance sheet, all
amount to be deposited is used to measure the staff remuneration with the discounted cash flow.
The Company discounts obligations of all defined benefit plans in accordance with the market earnings rate of
national debt or high-quality corporate bonds on active market corresponding to the defined benefit plan period and
currency on the date of balance sheet, including obligations of payment within 12 months after expiry of annual reporting
period which the staff provides service.
Where there is asset in the defined benefit plan, deficit or surplus that the obligatory present value of the defined
benefit plan minus fair value of the defined benefit plan is confirmed as net liabilities or net assets of the defined benefit
plan. Where there is surplus in the defined benefit plan, the enterprise measures net assets of the defined benefit plan
with the surplus of the defined benefit plan and the upper limit of assets, which is lower. Of them, the upper limit of the
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 65Annual Report 201564
(3) Transferring use right of assets
Interest income of the Company’s cash assets by others is determined in accordance with time and actual interest
rate of the cash used; as for the Company’s non-monetary assets used by the Company, the occurred use fee is
determined in accordance with the charging time and methods in accordance with relevant contracts and agreements.
(4) Building contract
On the date of balance sheet, where the result of building contract can be estimated reliably, contract income and
contract costs are confirmed in accordance with the completion percentage. The Company confirms completion progress
in accordance with the ratio of contract costs occurred to total contract cost. Where the result of building contract cannot
be estimated reliably and the contract cost can be recovered, the income of contract is confirmed in accordance with the
actually recovered cost and the contract costs are confirmed as contract costs in the period of occurrence; where the
contract costs cannot be recovered, contract costs are confirmed immediately when occurred and cannot be confirmed
as income of contract.
26. Government subsidy
The government subsidy is classified into government subsidy related to assets and government subsidy related to
earnings.
(1) Judgment basis and accounting processing of government subsidy related to assets
The government subsidy acquired by the Company for building or forming long-term asset is of government subsidy
related to assets.
The government subsidy related to assets is confirmed as deferred earnings, is allocated within service life of the
assets and accounted into current profits and losses.
(2) Judgment basis and accounting process of government subsidy related to earnings
The government subsidy except the government subsidy related to assets is the government subsidy related to
earnings. The government subsidy related to earnings are processed as follows:
① Where the government subsidy is used to compensate the Company’s expenses or losses in the future, the
government subsidy is confirmed as deferred earnings, and is accounted into current profits and losses in the period of
confirming relevant expenses.
② Where the government subsidy is used to compensate relevant costs or expenses occurred of the Company, the
government subsidy is accounted into current profits and losses.
The government subsidy is confirmed and measured in accordance with the actual amount received. Only definitive
evidences show that the subsidy is appropriated according to the quota standard and definitive evidences show that it
satisfies relevant terms and conditions on financial support and the financial support fund can be received, confirmation
and measurement are conducted in accordance with the amount receivable.
27. Deferred income tax assets/deferred income tax liabilities
The difference between book value of assets and liabilities and the taxing basis, and the temporary difference from
difference the book value of the taxing basis and the difference between the taxing basis for assets and liabilities not
confirmed are confirmed as deferred income tax assets and deferred income tax liabilities according to the assets and
liabilities methods.
Under general conditions, all temporary differences are confirmed as relevant deferred income tax. As for deductible
temporary difference, limited by the taxable income tax used to deduct the deductible temporary difference, relevant
income tax assets are confirmed. Besides, temporary difference related to initial confirmation of assets or liabilities related
to initial confirmation of goodwill and not affecting accounting profit and taxable income amount (or deductible losses) in
transaction are not confirmed as relevant deferred income tax assets or liabilities.
As for deductible losses and tax reduction carried forward to the following years, the corresponding deferred income
tax assets are confirmed limited by the taxable income amount to deduct deductible losses and taxes in the future.
Confirm deferred income tax liabilities from taxable temporary difference related to subsidiaries, joint venture and
cooperative enterprise, unless the Company controls the time of recovery of the temporary difference, and the temporary
difference will not be recovered in the foreseeable future. As for deductible temporary difference related to subsidiaries,
joint venture and cooperative enterprise, only when the temporary difference can be recovered from the foreseeable
Company, services acquired in the current period are accounted into costs or expenses, and corresponding liabilities are
added. On each date of balance sheet and each date of settlement before debt settlement, fair value of the liabilities are
re-measured, and the changes are accounted into current profits and losses.
(2) Determination of fair value of equity instruments
As for shares granted to the staff, the fair value is measured in accordance with market price of the company
shares, and adjustments are made in accordance with terms and conditions of the shares granted (exclusive of optional
conditions out of market conditions).
As for stock option granted to the staff, fair value of options are granted in accordance with the option pricing model.
(3) Confirm basis for optimal estimate of the exercisable equity instruments
On each date of balance sheet within the waiting period, make optimal estimate according to change of number
of staff qualified for exercising options and other subsequent information and modify quantity of exercisable equity
instruments.
(4) Processing of modifying and terminating the share payment plan
If the modification of the share payment plan increases fair value of the equity instruments granted, confirm
increasing of services acquired according to increasing of fair value of the equity instruments.
If increasing of the share payment increases quantity of equity instruments granted, the increased fair value of equity
instruments is confirmed as increasing of service acquired.
If the option exercising conditions are modified advantageous to the staff, such as lessening waiting period,
changing or modifying performance period (not market conditions), the Company considers the option exercising
conditions after disposing of the option exercising conditions.
If terms and conditions are modified by decreasing total amount of fair value by share payment or other forms
disadvantageous to the staff, accounting processing is applied to the service acquired as if no change occurs, unless
equity instruments granted have been cancelled completely or partially.
If the equity instruments granted are cancelled during the waiting period, the cancelled equity instruments granted
can be used as accelerated option exercising, amount confirmed in the remaining waiting period is immediately accounted
into current profits and losses, and Capital reserve is confirmed. Where the staff or other parties selects the non-exercisable
conditions but not satisfied during the waiting period, cancellation of the equity instrument granted is taken.
25. Income
(1) Sales of commodity
When commodities sold by the Company satisfy the following conditions, sales income is confirmed in accordance with
the amount of contract or agreement price received or to be received from the purchaser:①Main risks and remunerations
of the commodity risks are transferred to the purchaser;②Not retaining continuing management related to the title and not
applying effective control over the commodity sold;③The amount of income can be measured reliably; ④Relevant economic
benefits may flow into the enterprise; ⑤relevant occurred costs or costs to occur can be measured reliably.
According to requirements of the above principles, the Company selects different conditions to confirm income
based on various sales forms and characteristics:
① A single piece of equipment, delivered in accordance with the Contract, and the Company confirms income after
issuing invoice (as for a single piece of equipment sold to other countries, the Company confirms income after customs
clearance is completed and special invoice for export has been issued).
② Income of project is confirmed in accordance with the project progress.
③ Income of clean gas is confirmed in accordance with gas supply volume.
(2) Supply of labors
Where the result of labor supplied on the date of balance sheet can be estimated reliably, the income of labor
supplied is confirmed in accordance with the completion percentage. The Company confirms completion progress of
the labor supplied according to the ratio of occurred cost to total cost. Where the result of labor supplied on the date
of balance sheet cannot be estimated reliably and the occurred labor costs can be compensated, the labor income is
confirmed in accordance with the occurred labor cost, and is carried forwards into labor cost with the same amount;
where the occurred labor costs cannot be compensated, the occurred labor costs are accounted into current profits and
losses, and the income of labor cannot be confirmed.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 67Annual Report 201566
The unrealized financing earnings is confirmed as the current financing revenue with the actual interest rate method
during the leasing period. Or the rent is accounted into current profits and losses when occurred.
29. Other key accounting policy and accounting estimate
(1) Business termination
Business termination refers to a composition disposed of by the Company, classified as sell-waiting and individually
identified in operating and preparing the financial statement when one of the following conditions is satisfied: ①The
composition represents an independent main business or main business area;②The composition is a part of an
independent main business or a business area;③The composition is the subsidiary acquired for re-sales.
Refer to Annotation IV. 13 “Classified as Sell-waiting Assets” of Annotation on accounting process of business
termination.
(2) Debt reconstruction
As the debt reconstruction for the creditor’s recording the debtors’ repaying the debt, the difference between book
value of the reconstructed creditor’s right and the cash received is accounted into current profits and losses/where the
debt is liquidated not with cash assets, the difference between book value of the reconstructed creditor’s right and the
fair value of non-cash assets received is accounted into current profits and losses. Where the depreciation reserve is
accrued for the reconstructed creditor’s right, the above difference is used to offset the accrued depreciation reserve;
where insufficient, it is accounted into current profits and losses.
(3) Non-monetary asset swap
If the non-monetary asset swap is of business nature and fair value of the swap-in or swap-out assets can be
measured reliably, fair value of the swap-out assets (except definitive evidences show that fair value of the swap-in asset
is more reliable) and relevant taxes payable are taken as cost of swap-in costs, and the difference between the fair value
and the book value of the swap-out assets is accounted into current profits and losses. If the non-monetary asset swap
does not satisfy the above conditions, the book value of the swap-out assets and relevant taxes payable are taken as
costs of swap-in assets and profits and losses are not confirmed.
30. Change of significant accounting policy and accounting estimate
(1). Change of significant accounting policy
□Applicable √Not applicable
The Company does not involve change of accounting policy in the reporting period.
(2). Change of significant accounting estimate
□Applicable √Not applicable
The Company does not involve change of accounting policy in the reporting period.
VI. Tax
1. Main tax types and tax rate
Tax types Taxing basis Tax rate
VAT Taxable income 13%、17%
Business tax Taxable income 5%
Urban maintenance and construction tax Taxable turnover tax 7%
Education fee extra Taxable turnover tax 3%
Local education fee extra Taxable turnover tax 2%
Dike fee Taxable income 0.72‰
Corporate income tax Taxable corporate income 15%、25%
future and can be used to deduct taxable income amount of the deductible temporary difference in the future, the
deferred income tax assets are confirmed. On the date of balance sheet, as for the deferred income tax assets and the
income tax liabilities, according to the law of tax, the applicable rate in the period of recovering assets or liquidating
liabilities shall be applied.
Except other comprehensive earnings directly accounted or current income tax related to transaction and events of
shareholders’ equity and deferred income tax accounted into other comprehensive earnings or shareholders’ equity, and
the book value of goodwill adjusted from deferred income tax from enterprise merging, other current income taxes and
deferred income taxes or costs are accounted into current profits and losses.
On the date of balance sheet, book value of the income tax assets is reviewed. If sufficient taxable amount cannot
be obtained to deduct interests of the deferred income tax assets, write down book value of the deferred income tax
assets. When the sufficient taxable income amount can be obtained, the written-down amount can be recovered.
When given the statutory right of settling with net amount and intended to settle with net amount or acquire assets
or liquidate liabilities, the Company’s current income tax assets and current income tax liabilities are listed with the net
amount after deduction.
When given the statutory right of settling the current income tax assets and current income tax liabilities with net
amount, and the deferred income tax assets and the deferred income tax liabilities are income taxes levied by the same
tax levying authorities against the same taxpayers or against different taxpayers, within each key recovery period of
deferred income tax assets and liabilities, when the taxpayers intend to settle the current income tax assets or liabilities or
acquire assets and liabilities simultaneously, the deferred income tax assets and deferred income tax liabilities are listed
with the net amount after deduction.
28. Leasing
The financing leasing is the leasing transferring all risks and remunerations related to the asset ownership, and the
ownership may be transferred or not transferred finally. Other leasing except the financing leasing is operation leasing.
(1) The Company records business leasing as lessee
Rent expenses of business leasing is accounted into relevant asset costs or current profits and losses in
accordance with the straight-line method in the period of leasing. The initial direct costs are directly accounted into
current profits and losses, or the rent is accounted into current profits and losses when occurred.
(2) The Company records business leasing as lessor
Rent income of business leasing is confirmed as current profits and losses in accordance with the straight-line
method. The initial direct costs with significant amount are capitalized when occurred, and are accounted into current
profits and losses in accordance with the basis of rent confirmation in the leasing period; initial direct costs with
insignificant amount are accounted into current profits or losses when occurred; or accounted into current profits and
losses when occurred.
(3) The Company records financing leasing as lessee
On the date of commencement of the leasing period, fair value of the leasing assets or the minimum present value of
leasing payment is taken as accounting value of the leased assets, which is lower, the minimum leasing payment is taken
as accounting value of the long-term payables, and the difference is taken as not confirmed financial costs. Besides,
the initial direct costs occurred in leasing negotiation and leasing contract signing and attributed to the leasing project
are accounted into values of the leased assets. The balance that the minimum leasing payment minus the not confirmed
financing costs is listed as long-term liabilities and long-term liabilities due in 1 year.
As for the not confirmed financial costs, the actual interest rate method is used to confirm the current financing
costs with the interest rate methods. The rent is accounted into current profits and losses when occurred.
(4) The Company records financing leasing as lessor
On the date of commencement of leasing, the sum of the minimum leasing payment and the initial direct cost is
taken as accounting value of the financing leasing payment receivable, and unguaranteed remaining value is recorded;
the difference between the sum of minimum leasing receivable, initial direct cost and unguaranteed remaining value
and the sum of the present value is confirmed as not realized financing earnings. The balance that the financing leasing
payment receivable minus the not realized financing earnings is listed as long-term receivables and non-current assets
due in one year.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 69Annual Report 201568
VII. Annotation to items of consolidated financial statements
1. Monetary fund Unit: yuan, currency: RMB
Item Closing balance Opening balance
Cash on hand 1,398,467.47 1,028,897.06
Bank deposit 584,658,790.08 256,919,326.02
Other monetary fund 142,987,636.89 89,928,984.07
Total 729,044,894.44 347,877,207.15
Wherein: total amount deposited in overseas countries 4,837,560.41 22,520,349.93
Remarks: Closing balance of other monetary fund includes acceptance draft security of 120,091,111.36 yuan, guarantee security of 14,564,525.53 yuan, equipment mortgage security of 3,336,000.00 yuan, and the Buyer’s credit loan security of 4,996,000.00 yuan.
2. Instruments receivables (1) Classifying list of notes receivable√Applicable □Not applicable
Unit: yuan, currency: RMB
Item Closing balance Opening balance
Bank acceptance instruments 141,247,442.11 131,626,100.76
Commercial acceptance instruments 6,242,279.53
Total 147,489,721.64 131,626,100.76
(2) Instruments receivables endorsed or discounted by the Company but undue in the balance sheet at the end of the period
√Applicable □Not applicableUnit: yuan, currency: RMB
Item Amount terminated for confirmation
at the end of the period
Amount not terminated for
confirmation at the end of the period
Bank acceptance instruments 404,076,805.08
Commercial acceptance instruments
Total 404,076,805.08
3. Receivables (1) Classifying disclosure of receivables
Unit: yuan, currency: RMB
Category
Closing balance Opening balance
Book balance Non-performing debt reserve
Book value
Book balance Non-performing debt reserve
Book valueAmount
Ratio
(%)Amount
Accrual
ratio(%)Amount
Ratio
(%)Amount
Accrual
ratio(%)
Receivables with significant single amount and non-performing debt reserve accrued
98,040,134.28 7.23 98,040,134.28 100.00 3,680,000.00 0.42 3,680,000.00 100.00
Financing and leasing equipment receivable overdue
141,636,182.24 10.45 28,327,236.45 20.00 113,308,945.79 106,830,202.50 12.22 21,366,040.50 20.00 85,464,162.00
Receivables with non-performing debt reserve accrued according to credit risk feature portfolio
1,093,441,801.02 80.66 101,927,360.29 9.32 991,514,440.73 746,709,036.88 85.41 78,139,090.60 10.46 668,569,946.28
Receivables with
insignificant single
amount and non-
performing debt reserve
accrued
22,523,624.04 1.66 22,523,624.04 100.00 17,017,256.78 1.95 17,017,256.78 100.00
Total 1,355,641,741.58 100.00 250,818,355.06 18.50 1,104,823,386.52 874,236,496.16 100.00 120,202,387.88 13.75 754,034,108.28
Where taxpayers with different corporate income tax rates exist, provide details.
√Applicable □Not applicable
Taxpayer Tax rate
KEDA Clean Energy Co., Ltd. 15%
KEDA (Anhui) Industrial Co., Ltd. 15%
KEDA (Anhui) Clean Energy Co., Ltd. 15%
Foshan Henglitai Machinery Co., Ltd. 15%
Wuhu KEDA Suremaker Co., Ltd. 15%
Foshan KEDA Hydraulic Machinery Co., Ltd. 15%
Henan KEDA Dongda International Engineering Co., Ltd. 15%
Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd. 15%
Foshan KEDA Stone Machinery Co., Ltd. 25%
Anhui KEDA Aer Compressor Co., Ltd. 25%
Changsha Aer Compressor Co., Ltd. 25%
Emeishan KEDA Clean Energy Co., Ltd. 25%
Shenyang KEDA Clean Energy Gas Co., Ltd. 25%
Linyi KEDA Clean Energy Co., Ltd. 25%
Foshan Do Better Machinery Co., Ltd. 25%
Foshan Henglitai Labor Dispatching Co., Ltd. 25%
Maanshan KEDA Xinmingfeng Engineering Co., Ltd. 25%
Anhui Jiufu New Wall Materials Co., Ltd. 25%
Anhui Xincheng Investment Co., Ltd. 25%
Guangdong Xincheng Financing and Leasing Co.. Ltd. 25%
Anhui Xincheng Financing and Leasing Co., Ltd. 25%
Ningxia Kehang Environmental Protection Engineering Co., Ltd. 25%
Anhui KEDA Clean Energy New Materials Co., Ltd. 25%
Zhangzhou Juming Graphite Co., Ltd. 25%
2. Tax preferences
KEDA Clean Energy Co., Ltd. (certificate No. : GR201444000454) and Foshan Henglitai Machinery Co., Ltd.
(certificate No.: GR201444000257) were certified as hi-tech enterprises of Guangdong Province for 2014, with corporate
income tax rate of 15%.
KEDA (Anhui) Industrial Co., Ltd. (certificate No.: GR201534000004) was certified as hi-tech enterprise of Anhui
Province for 2014, with corporate income tax rate of 15%.
KEDA (Anhui) Clean Energy Co., Ltd. (certificate No.: GF201334000072) was certified as hi-tech enterprise of Anhui
Province for 2013, with corporate income tax rate of 15%.
Wuhu KEDA Suremaker Co., Ltd. was certified as hi-tech enterprise of Anhui Province for 2015 (certificate No.:
GR201534000376), with corporate income tax rate of 15%.
Foshan KEDA Hydraulic Machinery Co., Ltd. was certified as the 2nd lot of hi-tech enterprise of Guangdong
Province for 2013 (certificate No.: GR201344000624), with corporate income tax rate of 15%.
Henan KEDA Dongda International Engineering Co., Ltd. was certified as hi-tech enterprise of Henan Province for
2015 (certificate No.: GF201541000086), with corporate income tax rate of 15%.
Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd. was certified as hi-tech enterprise of
Jiangsu Province for 2014 (certificate No.: GR201432002192), with corporate income tax rate of 15%.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 71Annual Report 201570
Details of writing-off significant receivables
√Applicable □Not applicableUnit: yuan, currency: RMB
Client Nature of receivable
Amount written off
Cause of writing-off
Writing-off procedures performed
Whether caused by related transactions
Client AGoods payment
6,581,974.38 UnrecoverableNon-performing debt writing-off approval procedure
No
Client BGoods payment
2,434,631.64 UnrecoverableNon-performing debt writing-off approval procedure
No
Client CGoods payment
1,767,884.10 UnrecoverableNon-performing debt writing-off approval procedure
No
Client DGoods payment
1,193,846.50 UnrecoverableNon-performing debt writing-off approval procedure
No
Client EGoods payment
1,187,820.00 UnrecoverableNon-performing debt writing-off approval procedure
No
Client FGoods payment
1,058,827.00 UnrecoverableNon-performing debt writing-off approval procedure
No
Client GGoods payment
541,722.04 UnrecoverableNon-performing debt writing-off approval procedure
No
Client HGoods payment
498,461.50 UnrecoverableNon-performing debt writing-off approval procedure
No
Client IGoods payment
361,465.39 UnrecoverableNon-performing debt writing-off approval procedure
No
Client JGoods payment
350,000.00 UnrecoverableNon-performing debt writing-off approval procedure
No
Client KGoods payment
360,000.00 Unrecoverable Non-performing debt writing-off approval procedure
No
Total / 16,336,632.55 / / /
(4) Receivables of top 5 debtors according to closing balance
Client Relations with the company Amount owe (yuan) Rate of total receivables (%)
Client 1 Non-related party 93,990,000.00 6.93
Client 2 Non-related party 83,735,675.02 6.18
Client 3 Non-related party 73,929,265.64 5.45
Client 4 Non-related party 41,442,194.08 3.06
Client 5 Non-related party 24,087,502.54 1.78
Total 317,184,637.28 23.40
Remarks 1: Of the receivables, there is no shareholders’ own with 5% or more voting shares of the Company;
Remarks 2: Closing balance of receivable is increased by 46.52% than the opening balance, mainly caused by merging Jiangsu
Kehang Environmental Protection Science & Technology Co., Ltd.
4. Accounts prepaid (1) Listing of accounts prepaid according to debt age
Unit: yuan, currency: RMB
Debt age Closing balance Opening balance
Amount Ratio(%) Amount Ratio(%)
Within 1 year 179,036,961.81 85.06 108,004,997.94 84.29
1 to 2 years 23,640,627.18 11.23 16,009,561.34 12.49
2 to 3 years 4,024,798.28 1.91 2,391,957.66 1.87
More than 3 years 3,784,087.06 1.80 1,721,524.42 1.35
Total 210,486,474.33 100.00 128,128,041.36 100.00
Receivables with single significant amount with non-performing debt reserve accrued separately
√Applicable □Not applicableUnit: yuan, currency: RMB
Receivable (for each client)
Closing balance
Receivable Non-performing
debt reserve
Accrual
ratio(%) Cause of accrual
Client A 33,661,733.88 33,661,733.88 100.00 Client’s insolvency
Client B 24,728,412.18 24,728,412.18 100.00 Client’s insolvency
Client C 23,533,759.06 23,533,759.06 100.00 Client’s filing bankruptcy
Client D 9,501,666.85 9,501,666.85 100.00 Client insolvency
Client E 3,480,000.00 3,480,000.00 100.00 Client’s filing bankruptcy
Client F 3,134,562.31 3,134,562.31 100.00 Client insolvency
Total 98,040,134.28 98,040,134.28 / /
In the combination, receivables with non-performing debt accrued according to the debt age analysis method:
√Applicable □Not applicableUnit: yuan, currency: RMB
Debt age
Closing balance
Accounts
receivable
Non-performing
debt reserve
Accrual ratio
(%)
Within 1 year 860,717,402.50 43,035,870.13 5.00
1 to 2 years 142,511,931.82 28,502,386.36 20.00
2 to 3 years 49,057,098.46 9,811,419.69 20.00
More than 3 years 41,155,368.24 20,577,684.11 50.00
Total 1,093,441,801.02 101,927,360.29
In the combination, receivables with non-performing debt reserve accrued with balance percentage method:
√Applicable □Not applicableUnit: yuan, currency: RMB
Balance percentage
Closing balance
Receivables Non-performing
debt reserve
Accrual ratio
(%)
Financing and leasing companies 141,636,182.24 28,327,236.45 20.00
Total 141,636,182.24 28,327,236.45
(2) Details of accrued, recovered or carried back in this period
Non-performing debt reserve in this period is 132,943,964.54 yuan; and non-performing debt reserve recovered or
carried back in this period is 0.
(3) Details of receivables written off in this period
√Applicable □Not applicableUnit: yuan, currency: RMB
Item Amount written off
Receivables actually written off 23,670,373.56
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 73Annual Report 201572
In the combination, other receivables with non-performing debt reserve accrued in accordance with the debt age
analysis method:
√Applicable □Not applicableUnit: yuan, currency: RMB
Debt age Closing balance
Other receivables Non-performing
debt reserve Accrual ratio
(%)
Within 1 year 59,692,094.14 2,984,604.71 5.00
1 to 2 years 11,994,181.66 2,398,836.33 20.00
2 to 3 years 2,571,658.93 514,331.79 20.00
More than 3 years 4,652,373.20 2,326,186.60 50.00
Total 78,910,307.93 8,223,959.43
Of combinations, other receivables with non-performing debt reserve accrued with other methods:
√Applicable □Not applicable
Portfolio Book balance (yuan) Non-performing debt reserve
Bidding security 4,382,000.00
Export rebate 25,905,556.43
Total 30,287,556.43
(2) Details of non-performing debt reserve accrued, recovered or carried back in this period Non-performing debt reserve accrued in this period is 762,379.92 yuan; and the non-performing debt reserve
recovered or carried back in this period is 0. (3) Details of other receivables of the top 5 debtors for closing balance √Applicable □Not applicable
Unit: yuan, currency: RMB
Company Nature of fund Closing
balanceDebt age
Rate of total closing
balance of other
receivables (%)
Closing balance
of non-performing
debt reserve
Jiangsu Yanfu Construction Group Co., Ltd.
Current accounts
35,000,000.00
Within 1 year1 to 2 years
24.24
Liaoning Faku Economic Development Zone Management Committee
Current accounts
30,070,075.28Within 1 year
20.83 1,503,503.76
Company A with current accounts
Export rebate 20,005,724.27Within 1 year
13.86
Company B with current accounts
Export rebate 5,899,832.16Within 1 year
4.09
Company C with current accounts
Current accounts
3,600,000.001 to 2 years
2.49 720,000.00
Total / 94,575,631.71 / 65.51 2,223,503.76
Remarks 1: Of other receivables, there is no arrears by shareholders with 5% or more voting shares of the Company.
Remarks 2: Other receivables with single significant amount with non-performing debt reserve accrued 35 million yuan is caused
by merging Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd. The Company’s former
shareholder Liu Huaiping provided guarantee for loan to Jiangsu Yanfu Construction Group Co., Ltd. with self-owned
land of Jiangsu Zhongke Energy Conservation and Environmental Protection Technology Co., Ltd. (certificate No.:
T.H.G.Y. (2010) No.601757), workshop (certificate No.: Y.Q.F.Z.H.Q.N.Z. No.007979) and equipment.
Remarks 3: Closing balance of other receivables is increased by 251.77% compared with the opening balance, mainly caused
by the subsidiary Shenyang KEDA Clean Energy’s lending 30.0701 million yuan to Liaoning Faku Economic
Development Zone Management Committee, Jiangsu Kehang’s lending 35.0000 million yuan to Jiangsu Yanfu
Construction Group Co., Ltd. and the parent company’s newly increased export rebate of 20.0057 million yuan.
(2) Accounts prepaid of the top 5 prepaying entities for closing balance
Debtor Relation with
the Company
Amount owe
(yuan)
Rate of total accounts
prepaid (%) Causes for not settled
Supplier ANon-related
party 13,000,000.00 6.18 Within delivery period of the Contract
Supplier BNon-related
party11,068,550.00 5.26 Within delivery period of the Contract
Supplier CNon-related
party10,589,168.45 5.03 Within delivery period of the Contract
Supplier DNon-related
party10,110,619.00 4.80 Within delivery period of the Contract
Supplier ENon-related
party8,812,772.48 4.19 Within delivery period of the Contract
Total 53,581,109.93 25.46
Remarks 1: Closing balance of accounts prepaid does not include owe by shareholders with 5% or more voting shares of the
Company.
Remarks 2: Closing balance of accounts pre-paid is increased by 64.28% compared with the opening balance, mainly caused by
merging Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd.
5. Other receivables
(1) Disclosure of classification of other receivables Unit: yuan, currency: RMB
Category
Closing balance Opening balance
Book balance Non-performing debt reserve
Book value
Book balance Non-performing debt reserve
Book valueAmount
Ratio
(%)Amount
Accrual
ratio (%)Amount
Ratio
(%)Amount
Accrual
ratio
(%)
Receivables with significant single amount and non-performing debt reserve accrued
35,000,000.00 24.24
Export rebate 25,905,556.43 17.94 25,905,556.43 662,787.24 1.43 662,787.24
Bidding security 4,382,000.00 3.04 4,382,000.00 3,412,500.00 7.37 3,412,500.00
Other receivables with non-performing debt reserve accrued according to credit risk feature portfolio
78,910,307.93 54.66 8,223,959.43 10.42 70,686,348.50 40,720,008.02 87.96 6,141,579.51 15.08 34,578,428.51
Receivables with insignificant single amount and non-performing debt reserve accrued
180,000.00 0.12 180,000.00 100.00 1,500,000.00 3.24 1,500,000.00 100.00
Total 144,377,864.36 100.00 8,403,959.43 5.82 135,973,904.93 46,295,295.26 100.00 7,641,579.51 16.51 38,653,715.75
Other receivables with single significant amount with non-performing debt reserve accrued at the end of the period
√Applicable □Not applicableUnit: yuan, currency: RMB
Other receivables (Subject to Company)
Closing balance
Other
receivables
Non-performing
debt reserve
Ratio of
accrual
Cause of
accrual
Jiangsu Yanfu Construction Group Co., Ltd. 35,000,000.00 Refer to
Remarks 2
Total 35,000,000.00 / /
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 75Annual Report 201574
9. Long-term receivables
√Applicable □Not applicable
(1) Long-term receivables: Unit: yuan, currency: RMB
Item
Closing balance Opening balanceRange of
discounting
rateBook balance
Non-
performing
debt reserve
Book value Book balance
Non-
performing
debt reserve
Book value
Financing and
leasing payment 380,428,530.53 380,428,530.53 469,000,529.24 469,000,529.24
Wherein: unrealized
financial earnings 19,919,480.99 19,919,480.99 33,855,004.74 33,855,004.74
Total 380,428,530.53 380,428,530.53 469,000,529.24 469,000,529.24
10. Long-term equity investment:
√Applicable □Not applicableUnit: yuan, currency: RMB
Invested partyOpening
balance
Change from increasing or decreasing during the period
Closing
balance
Closing
balance of
depreciation
reserve
Investment
increased
Investment
decreased
Gains and
losses
confirmed
under the
equity law
Other
comprehensive
earning
adjustment
Other
equity
changes
Cash
dividend
or profit
declared or
issued
Depreciation
reserve
accrued
Others
I. Joint venture
II. Cooperative
enterprise
Jiangyin Tianjiang
Pharmaceutical Co., Ltd. 209,889,585.21 259,968,376.83 50,078,791.62
Guangdong Taiwei Digital
Ceramics Printing Co.,
Ltd.
8,258,025.03 7,694,126.51 -59,413.57 504,484.95
Subtotal 218,147,610.24 267,662,503.34 50,019,378.05 504,484.95
Total 218,147,610.24 267,662,503.34 50,019,378.05 504,484.95
Remarks: In accordance with the Agreement on Transfer of Equity of Jiangyin Tianjiang Pharmaceutical Co., Ltd. signed with
China TCM Co., Ltd. on December 31, 2014, the Company sold 9.6732% equity of Jiangyin Tianjiang Pharmaceutical
Co., Ltd. to China TCM Co., Ltd., and the procedure for change at the administration for industry and commerce was
completed on October 30, 2015.
11. Fixed assets
(1) Particulars of fixed assets Unit: yuan, currency: RMB
ItemProperty and
building
Machines and
equipment
Transport
tools
Office
equipment Total
I. Original book value
1.Opening balance 948,744,269.45 1,161,253,845.13 25,743,209.67 40,100,715.89 2,175,842,040.14
2.Increment in this period 284,057,326.60 204,986,016.42 9,217,264.95 18,146,598.97 516,407,206.94
(1)Purchasing 7,254,953.35 30,650,252.81 3,655,181.60 2,997,163.44 44,557,551.20
(2)Transfer from projects under
construction 62,809,695.14 86,790,559.41 5,554,466.39 155,154,720.94
(3)Increment from enterprise
merging 213,992,678.11 87,545,204.20 5,562,083.35 9,594,969.14 316,694,934.80
3.Decrement in this period 6,146,919.79 93,641,014.81 4,835,382.78 4,333,159.10 108,956,476.48
(1)Disposal or scrapping 6,146,919.79 93,641,014.81 4,835,382.78 4,333,159.10 108,956,476.48
4.Closing balance 1,226,654,676.26 1,272,598,846.74 30,125,091.84 53,914,155.76 2,583,292,770.60
6. Stock
(1) Classification of stock Unit: yuan, currency: RMB
Item
Closing balance Opening balance
Book value Depreciation
reserveBook value Book value
Depreciation
reserveBook value
Raw materials 209,163,792.09 209,163,792.09 194,348,627.87 442,792.19 193,905,835.68
Goods in process 745,263,004.26 745,263,004.26 678,791,340.52 678,791,340.52
Stock commodity 325,828,170.32 325,828,170.32 319,339,491.00 1,191,437.45 318,148,053.55
Commodity shipped 30,916,768.78 30,916,768.78 21,707,966.58 21,707,966.58
Consumable biological
assets
Total 1,311,171,735.45 1,311,171,735.45 1,214,187,425.97 1,634,229.64 1,212,553,196.33
(2) Stock revaluation reserve Unit: yuan, currency: RMB
Item
Opening
balance
Increment in
this period
Decrement in
this period
Closing
balanceAccrued Others
Carried back
or written off Others
Raw materials 442,792.19 442,792.19
Goods in process
Stock commodity 1,191,437.45 1,191,437.45
Commodity shipped
Total 1,634,229.64 1,634,229.64
Remarks: Stock revaluation reserve is decreased in this period, caused by deregistration of Anhui Jiufu New Wall Materials Co.,
Ltd. and the accrued stock depreciation losses are written-off.
7. Non-current assets due in 1 year Unit: yuan, currency: RMB
Item Closing balance Opening balance
Financing and leasing 1,136,341,034.72 1,279,002,174.13
Wherein: earnings of financing and leasing not realized 63,045,595.58 99,414,289.82
Total 1,136,341,034.72 1,279,002,174.13
8. Other current assets Unit: yuan, currency: RMB
Item Closing balance Opening balance
Input tax of value-added tax to be deducted 139,314,656.82 125,133,109.50
Financing products by bank 107,000,000.00
Total 139,314,656.82 232,133,109.50
Remarks: Closing balance of other current assets is decreased by 39.99% than the opening balance 39.99%, mainly caused by
the bank financing products due and redemption.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 77Annual Report 201576
(2) Change of key projects under construction in this period
√ Applicable □ Not applicable Unit: yuan, currency: RMB
Project Budget Opening
balance
Amount
increased in
this period
Amount
transferred into
fixed assets in
this period
Other
decrement
in this
period
Closing
balance
Ratio of
cumulative
investment
to budget
(%)
Project
progress
(%)
Cumulative
amount of
interest
capitalization
Wherein:
amount of
interest
capitalization
in this period
Interest
capitalization
rate in this
period (%)
Fund
source
R & D Building of
Sanshui Base of
Henglitai
35,000,000.00 30,161,683.68 9,443,574.10 39,605,257.78 120.47 100.00
Anhui Xincheng
Mansion 50,000,000.00 33,697,305.87 14,599,013.91 199,726.00 48,096,593.78 96.59 96.59
Total 85,000,000.00 63,858,989.55 24,042,588.01 39,804,983.78 48,096,593.78 / / / /
13. Intangible assets
(1) Information of intangible assets Unit: yuan, currency: RMB
Item Land use right Application
software Patent right
Trademark
right
Non-patented
technology Total
I. Original book value
1.Opening balance 328,257,274.49 15,395,935.99 47,987,600.00 1,639,800.00 4,500,000.00 397,780,610.48
2.Increment in this period 114,259,080.52 758,324.79 18,608,457.27 133,625,862.58
(1)Purchasing 37,002,468.80 153,846.16 37,156,314.96
(2)Increment from enterprise merging 77,256,611.72 604,478.63 18,608,457.27 96,469,547.62
3.Decrement in this period
(1)Disposal
4.Closing balance 442,516,355.01 16,154,260.78 66,596,057.27 1,639,800.00 4,500,000.00 531,406,473.06
II. Cumulative amortization
1.Opening balance 37,481,401.71 11,199,527.53 12,055,424.49 903,205.01 900,000.00 62,539,558.74
2.Increment in this period 9,214,535.32 1,809,804.18 6,577,482.98 157,841.64 3,600,000.00 21,359,664.12
(1)Accrual 6,652,344.02 1,625,681.39 5,647,344.26 157,841.64 3,600,000.00 17,683,211.31
(2)Increment from enterprise merging 2,562,191.30 184,122.79 930,138.72 3,676,452.81
3.Decrement in this period
4.Closing balance 46,695,937.03 13,009,331.71 18,632,907.47 1,061,046.65 4,500,000.00 83,899,222.86
III. Depreciation reserve
1.Opening balance
2.Increment in this period
(1)Accrual
3.Decrement in this period
(1)Disposal
4.Closing balance
IV. Book value
1.Closing book value 395,820,417.98 3,144,929.07 47,963,149.80 578,753.35 447,507,250.20
2.Closing book value 290,775,872.78 4,196,408.46 35,932,175.51 736,594.99 3,600,000.00 335,241,051.74
ItemProperty and
building
Machines and
equipment
Transport
tools
Office
equipment Total
II. Cumulative depreciation
1.Opening balance 192,578,725.59 305,667,327.30 16,826,884.20 23,715,254.21 538,788,191.30
2.Increment in this period 71,759,573.46 91,871,707.75 7,520,712.06 12,067,203.29 183,219,196.56
(1)Accrual 43,132,421.84 76,718,622.56 3,678,695.92 5,530,577.08 129,060,317.40
(2)Increasing from enterprise
merging 28,627,151.62 15,153,085.19 3,842,016.14 6,536,626.21 54,158,879.16
3.Amount decreased in this period 4,506,591.67 34,937,422.60 4,196,499.92 3,409,248.34 47,049,762.53
(1)Disposal or scrapping 4,506,591.67 34,937,422.60 4,196,499.92 3,409,248.34 47,049,762.53
4.Closing balance 259,831,707.38 362,601,612.45 20,151,096.34 32,373,209.16 674,957,625.33
III. Depreciation reserve
1.Opening balance
2.Increment in this period
3.Decrement in this period
4.Closing balance
IV. Book value
1.Closing book value 966,822,968.88 909,997,234.29 9,973,995.50 21,540,946.60 1,908,335,145.27
2.Opening book value 756,165,543.86 855,586,517.83 8,916,325.47 16,385,461.68 1,637,053,848.84
12. Projects under construction
√Applicable □Not applicable
(1) Projects under construction Unit: yuan, currency: RMB
Item
Closing balance Opening balance
Book balanceDepreciation
reserve Book value Book balance
Depreciation
reserve Book value
Equipment and installation 8,330,699.02 8,330,699.02 19,784,748.21 19,784,748.21
Reconstruction of workshop
of KEDA (Anhui) Industrial
Plant
8,543,439.40 8,543,439.40
Property and building of
Shenyang KEDA Clean
Energy
893,680.00 893,680.00
Xianyong Workshop of
Guanglong of KEDA
Industrial Plant
3,652,085.37 3,652,085.37
R & D Building of Sanshui
Base of Henglitai 30,161,683.68 30,161,683.68
Artificial stone engineering
and experimenting center 8,000,136.34 8,000,136.34
Anhui Xincheng Mansion 48,096,593.78 48,096,593.78 33,697,305.87 33,697,305.87
Workshop of KEDA (Anhui)
Clean Energy 5,537,235.50 5,537,235.50
Other sporadic projects 5,505,798.60 5,505,798.60 11,653,648.10 11,653,648.10
Total 61,933,091.40 61,933,091.40 121,923,962.47 121,923,962.47
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 79Annual Report 201578
(2) Deferred income tax liabilities not deducted
√ Applicable □ Not applicable Unit: yuan, currency: RMB
Item
Closing balance Opening balance
Taxable temporary
difference
Deferred income
tax liabilities
Taxable temporary
difference
Deferred income
tax liabilities
Increased value of asset
appraisal of Henglitai 24,533,351.52 3,680,002.70 26,775,170.96 4,016,275.62
Increased value of asset
appraisal of Xinmingfeng27,868,006.86 4,180,201.03 31,460,916.63 4,730,570.88
Increased value of asset
appraisal of Dongda
Tailong
15,005,582.69 2,250,837.41 16,990,402.77 2,548,560.42
Increased value of Jiangsu
Kehang 70,672,951.39 11,168,672.77
Total 138,079,892.46 21,279,713.91 75,226,490.36 11,295,406.92
□ Applicable √ Not applicable
(3) Details of deferred income tax assets not confirmed
√ Applicable □ Not applicable Unit: yuan, currency: RMB
Item Closing balance Opening balance
Deductible losses 462,446,121.47 278,172,505.14
Total 462,446,121.47 278,172,505.14
(4) Deductible losses of deferred income taxes not confirmed will be due in the following years
√ Applicable □ Not applicable Unit: yuan, currency: RMB
Year Closing amount Opening amount Remarks
Year 2016 9,275,793.04 9,275,793.04
Year 2017 20,430,516.42 24,604,354.69
Year 2018 85,428,494.73 88,091,772.15
Year 2019 149,440,703.15 156,200,585.26
Year 2020 197,870,614.13
Total 462,446,121.47 278,172,505.14 /
16. Short-term loan
√ Applicable □ Not applicable
(1) Classification of short-term loan Unit: yuan, currency: RMB
Item Closing balance Opening balance
Guaranteed loan 200,974,904.37 462,324,000.00
Credit loan 152,780,400.00 344,310,400.00
Total 353,755,304.37 806,634,400.00
14. Goodwill
√ Applicable □ Not applicable
(1) Original book value of goodwill Unit: yuan, currency: RMB
Invested party or goodwill description Opening
balance
Increment in this period Decrement in this periodClosing balance
Enterprise merging Others Disposal Others
Foshan Henglitai Machinery Co., Ltd. 187,915,447.25 187,915,447.25
Anhui KEDA Xinmmingfeng Industrial Co., Ltd. 189,095,543.17 189,095,543.17
Changsha Aer Compressor Co., Ltd. 18,823,759.31 18,823,759.31
Henan KEDA Dongda Engineering Co., Ltd. 232,664,477.89 232,664,477.89
Foshan Do Better Machinery Co., Ltd. 14,811,525.16 14,811,525.16
Jiangsu Kehang Environmental Protection Co., Ltd. 75,596,829.84 75,596,829.84
Total 643,310,752.78 75,596,829.84 718,907,582.62
(2) Impairment of Goodwill Unit: yuan, currency: RMB
Invested party or goodwill descriptionOpening
balance
Increment in this period Decrement in this period Closing balance
Accrual Disposal
Changsha Aer Compressor Co., Ltd. 5,223,932.12 5,223,932.12
Wuhu KEDA Suremaker Co., Ltd. 65,407,924.98 65,407,924.98
Total 5,223,932.12 65,407,924.98 70,631,857.10
When depreciation testing is carried out for goodwill, according to profit forecast for the asset portfolio in the future,
the corporate free cash model of the earnings discount method is adopted.
All shareholders’ equity value=overall corporate value-value of interest-bearing debt
Overall corporate value=business asset value + overage asset value +non-business assets value
Business assets value (Free cash flow of enterprise) =after-tax net profit + depreciation and amortization+ interest
expenses (after deduction of tax influences)-capital expenses-increment of operation capital.
This appraisal reflects after-tax interest rate of relevant asset portfolio for specific risk 11.5% as discounting rate,
and the discounting rate is determined in accordance with the weighted average asset cost appraisal model.
At the end of the reporting period, through testing, goodwill depreciation of 65,407,924.98 yuan is accrued for
Xinmingfeng Company, and Nanjing Ruixingbo Asset Appraisal Co., Ltd. appraised recoverable amount of the asset
portfolio and issued the appraisal report of R.X.B (2016) No.107 on March 31, 2015. No depreciation was found in testing
for other companies.
15. Deferred income tax assets/deferred income tax liabilities
(1) Deferred income tax assets not deducted
√ Applicable □ Not applicable Unit: yuan, currency: RMB
Item
Closing balance Opening balance
Taxable temporary
difference
Deferred income
assets
Taxable temporary
difference
Deferred income
assets
Asset depreciation reserve 259,222,314.49 50,881,689.67 127,838,967.39 19,822,602.81
Profits not realized in
internal transactions 20,598,875.58 5,149,718.90 22,163,347.26 5,540,836.82
Deductible losses 31,774,028.16 7,943,507.04
Government subsidy 17,350,000.00 2,910,500.00
Total 297,171,190.07 58,941,908.57 181,776,342.81 33,306,946.67
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 81Annual Report 201580
18. Payables
(1) Listing of payables
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Closing balance Opening balance
Within 1 year 1,220,258,038.25 729,062,985.65
1 to 2 years 107,239,208.12 67,691,466.35
2 to 3 years 27,210,348.49 36,718,904.62
More than 3 years 22,540,798.52 17,052,815.22
Total 1,377,248,393.38 850,526,171.84
(2) Significant payables with debt age of more than 1 year
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Closing balanceCause for not repaid or
carried forward
Supplier F 2,848,657.60 Within credit period
Supplier G 6,725,820.17 Within credit period
Supplier H 3,151,781.20 Within credit period
Supplier I 2,810,127.87 Within credit period
Total 15,536,386.84 /
Remarks: Closing balance of payable is increased by 61.93% compared with the opening balance, caused by merging Jiangsu
Kehang.
19. Accounts pre-receivables
(1) Listing of accounts pre-receivables
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Closing balance Opening balance
Within 1 year 583,676,460.56 463,368,541.79
1 to 2 years 52,631,431.90 55,253,420.03
2 to 3 years 11,520,329.13 29,449,915.84
More than 3 years 33,679,857.38 21,478,801.70
Total 681,508,078.97 569,550,679.36
(2) Significant accounts pre-receivable with debt age of more than 1 year
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Closing balance Cause for not repaid or carried forward
Client L 7,919,212.00 Project suspended
Client M 7,439,200.00 Project in progress, not reaching settlement conditions
Total 15,358,412.00 /
Remarks: details of the guaranteed loan are described as follows:
Borrower Guarantor Mode of
guarantee Currency
Amount
in original
currency
Amount
converted into
RMB
Foshan Do Better Machinery Co., Ltd. KEDA Clean
Energy Co., Ltd.
Security
bond RMB 15,000,000.00 15,000,000.00
Anhui Xincheng Financing and Leasing
Co., Ltd.
KEDA Clean
Energy Co., Ltd.
Security
bondRMB 73,500,000.00 73,500,000.00
Jiangsu Kehang Environmental Protection
Science & Technology Co., Ltd.
KEDA Clean
Energy Co., Ltd.
Security
bondRMB 50,000,000.00 50,000,000.00
Xincheng International (Hong Kong) Co.,
Ltd.
KEDA Clean
Energy Co., Ltd.
Security
bondUSD 9,800,000.00 62,474,904.37
Total 200,974,904.37
17. Notes payable
√ Applicable □ Not applicable Unit: yuan, currency: RMB
Type Closing balance Opening balance
Commercial acceptance draft
Bank acceptance draft 430,184,109.88 373,808,839.79
Total 430,184,109.88 373,808,839.79
Total amount of instruments due but not paid at the end of the period is 0.
Remarks 1: Amount of bank acceptance drafted issued by the parent company and subsidiaries: Unit: yuan, currency: RMB
Company name Amount of bank acceptance draft
issued at the end of the period
KEDA Clean Energy Co., Ltd. 143,050,233.01
Wuhu KEDA Suremaker Co., Ltd. 10,500,000.00
KEDA (Anhui) Clean Energy Co., Ltd. 66,900,000.00
KEDA (Anhui) Industrial Co., Ltd. 10,000,000.00
Foshan Henglitai Machinery Co., Ltd. 9,640,000.00
Henan KEDA Dongda International Engineering Co., Ltd. 17,473,160.00
Jiangsu Kehang Environmental Protection Co., Ltd. 102,120,716.87
Ningxia Kehang Environmental Protection Engineering Co., Ltd. 32,000,000.00
Anhui Xincheng Financing and Leasing Co., Ltd. 38,500,000.00
Total 430,184,109.88
Remarks 2: The notes payable at the end of period will be due from January to June, 2016.
Remarks 3: The amount issued by Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd. is 102.1207 million
yuan, 15 million of which is guaranteed by Jiangsu Longda Building Material Environmental Protection Co., Ltd.,
20 million of which is guaranteed by Yancheng Environmental Protection Development and Investment Co., Ltd.,
and 8.40 million yuan of which is guaranteed by Jiangsu Yanfu Construction Group Co., Ltd. and three individual
properties by mortgage.
Remarks 4: The amount issued by Ningxia Kehang Environmental Protection Engineering Co., Ltd. is 32 million yuan, 16 million of
which is guaranteed by self-built workshop of Jiangsu Kehang Environmental Protection Science & Technology Co.,
Ltd., and Ningxia Kehang Environmental Protection Science & Technology Co., Ltd.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 83Annual Report 201582
Remarks: Closing balance of tax payable is increased by 171.31% compared with opening balance, mainly caused by the
Company’s disposal of 9.6732% equity of Tianjiang Pharmaceutical, investment earnings of 664.1776 million yuan is
confirmed, and the corporate income tax is increased significantly.
22. Other payables
(1) List of other payables according to nature of fund
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Closing balance Opening balance
Within 1 year 79,436,511.95 20,992,504.99
1 to 2 years 5,327,698.51 8,420,295.38
2 to 3 years 1,626,554.95 2,419,205.65
More than 3 years 1,420,593.82 2,003,592.09
Total 87,811,359.23 33,835,598.11
Remarks: Closing balance of other receivables is increased by 159.52% compared with opening balance, mainly caused by
merging Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd., and Zhangzhou Juming Graphite
Co., Ltd.
23. Non-current liabilities due in 1 year
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Closing balance Opening balance
Long-term loan due in 1 year 246,597,416.22 589,112,602.08
Total 246,597,416.22 589,112,602.08
Notes:
Remarks 1: Details of long-term loan due in 1 year Unit: yuan Currency: RMB
Item Closing balance Opening balance
Pledge loan 5,000,000.00
Warranted loan 246,597,416.22 584,112,602.08
Credit loan
Total 246,597,416.22 589,112,602.08
Remarks 2: Details of warranted borrowing are described as follows: Unit: yuan Currency: RMB
Borrower Guarantor Mode of
guaranteeCurrency
Amount
in original
currency
Amount
converted into
RMB
Shenyang KEDA Clean
Energy Gas Co., Ltd.
KEDA Clean Energy Co., Ltd.,
Shenyang Gas Co., Ltd.
Warranted
guaranteeRMB 72,499,999.60 72,499,999.60
Guangdong Xincheng
Financing and Leasing Co.,
Ltd.
KEDA Clean Energy Co., Ltd.Warranted
guaranteeRMB 8,000,000.00 8,000,000.00
Anhui Xincheng Financing
and Leasing Co., Ltd. KEDA Clean Energy Co., Ltd.
Warranted
guaranteeRMB 166,097,416.62 166,097,416.62
Total 246,597,416.22
20. Payroll payable (1) Listing of Payroll payable: √ Applicable □ Not applicable
Unit: yuan, currency: RMB
Item Opening balance
Increment this period
Decrement this period
Closing balance
I. Short-term remuneration 67,520,396.22 399,851,906.60 393,394,057.34 73,978,245.48
II. Post-resignation material benefits- defined contribution plan
21,642,858.08 21,642,858.08
III. Dismissal material benefits 3,978,670.04 3,978,670.04
IV. Other material benefits due in one year
Total 67,520,396.22 425,473,434.72 419,015,585.46 73,978,245.48
(2) Listing of short-term remunreations: √ Applicable □ Not applicable
Unit: yuan, currency: RMB
Item Opening balance
Increment this period
Decrement this period
Closing balance
I. Salary, bonus, allowance and subsidy 67,520,396.22 344,978,002.29 338,520,153.03 73,978,245.48
II. Staff’s material benefits 29,872,596.20 29,872,596.20
III. Social premium 13,376,349.90 13,376,349.90
Wherein: medical treatment premium 10,639,846.85 10,639,846.85
Work-related injury premium 1,568,399.26 1,568,399.26
Birth premium 1,168,103.79 1,168,103.79
IV. Housing fund 10,492,551.70 10,492,551.70
V. Labor union expenses and staff education expenses
1,132,406.51 1,132,406.51
Total 67,520,396.22 399,851,906.60 393,394,057.34 73,978,245.48
(3) Listing of defined contribution plan√ Applicable □ Not applicable
Unit: yuan, currency: RMB
ItemOpening balance
Increment this period
Decrement this period
Closing balance
1. Basic endowment insurance 20,613,704.48 20,613,704.48
2. Unemployment premium 1,029,153.60 1,029,153.60
Total 21,642,858.08 21,642,858.08
21. Taxes payable Unit: yuan, currency: RMB
Item Closing balance Opening balance
VAT 14,767,753.09 9,098,132.95
Business tax 30,796.82 64,980.49
Corporate income tax 99,640,213.89 25,392,046.69
Individual income tax 842,085.81 798,230.82
Urban maintenance and construction tax 1,098,426.62 1,466,270.79
Property tax 3,070,246.34 4,479,631.59
Land use tax 5,010,427.55 3,561,300.19
Education fee extra 788,830.37 1,071,399.30
Dike fee 180,283.83 265,219.52
Stamp tax 55,748.70 54,700.10
Total 125,484,813.02 46,251,912.44
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 85Annual Report 201584
Projects involving government subsidy: Unit: yuan, currency: RMB
Projects with liabilities Opening
balance
Newly
increased
subsidy in this
period
Amount
accounted into
non-business
income in this
period
Other
changes
Closing
balance
Related to
assets/related
to earnings
Supporting fund for construction of manufacturing
base of clean coal gas of Newpower appropriated by
Anhui Energy Bureau
24,500,000.00 3,500,000.00 21,000,000.00Related to
assets
Reconstruction of technology reconstruction of
ceramics thin plate of large sizes 2,040,000.00 510,000.00 1,530,000.00
Related to
assets
Technical reconstruction of complete outfit of
new energy saving environmental protection wall
materials
4,410,000.00 735,000.00 3,675,000.00Related to
assets
Special fund support for circularization
reconstruction pilot 33,000,000.00 3,300,000.00 29,700,000.00
Related to
assets
Industrial support fund of Henglitai 15,000,000.00 1,500,000.00 13,500,000.00Related to
assets
Total 30,950,000.00 48,000,000.00 9,545,000.00 69,405,000.00 /
Remarks: Closing balance of deferred earnings is increased by 124.25% than opening balance, mainly caused by the subsidiary
Shenyang KEDA Clean Energy receiving special subsidy for circularization reconstruction pilot 33 million yuan granted
by Liaoning Faku Economic Development Zone Management Committee, and the subsidiary Henglitai Company
receiving supporting fund 15 million yuan granted by Leping Economic Promotion Bureau of Sanshui District.
28. Other non-current liabilities Unit: yuan, currency: RMB
Item Closing balance Opening balance
Technology reconstruction of production base of high-pressure plunger
pump with capacity of 50 thousand sets 23,800,000.00 23,800,000.00
Environmental protection investment projects of Shenyang KEDA Clean
Energy 7,653,890.27 9,449,247.24
Application of IOT technology in industrialization of building material outfit 6,800,000.00 6,800,000.00
R & D of forming technology and complete equipment of extrusion of
semi-solid inner cavity 5,510,000.00 5,510,000.00
Comprehensive utilization of iron tailings 5,000,000.00
Innovation capability construction of technology center 5,000,000.00 5,000,000.00
Revitalizing and technical reconstruction by the National Development and
Reform Committee and the Ministry of Industry and Information 520,000.00 3,020,000.00
Reconstruction of production technology of complete equipment of clean
coal gasification 3,000,000.00 3,000,000.00
Key laboratory of energy saving and environmental protection enterprises
for ceramics machinery of Guangdong Province 2,000,000.00 2,000,000.00
Technical reconstruction of engineering experiment center of artificial
stone works 1,500,000.00 1,500,000.00
Development and application of daily ceramics and other static pressure
equipment and digitalized control technology 1,000,000.00 1,000,000.00
Key technology R & D and application of numerical ceramics roller kiln 1,000,000.00
Income from differential electricity charges of Guangdong Province 1,000,000.00
Construction of 0×20KNm3/h KEDA clean powder coal gasification and
comprehensive supporting facilities 900,000.00 1,000,000.00
Construction of cloud computing platform 900,000.00
24. Other current liabilities Unit: yuan, currency: RMB
Item Closing balance Opening balance
Short-term payable bonds 105,990,000.00
Total 105,990,000.00
Remarks: The Company issued 1st lot of short-term financing bonds with value of 100 million yuan and duration of 365 days on
January 19, 2015 (15 KEDA Clean Energy CP001), with total book value of bond 100 million yuan, nominal interest
rate of 5.99%, and it is mainly used to repay the bank loan, improve financing structure and supplement current funds.
25. Long-term loan
√ Applicable □ Not applicable
(1) Classification of long-term loan Unit: yuan, currency: RMB
Item Closing balance Opening balance
Warranted loan 177,213,094.45 218,644,825.15
Credit loan 189,000,000.00 60,000,000.00
Total 366,213,094.45 278,644,825.15
Remarks 1: Details of the warranted loan are set out as follows:
Borrower Guarantor Mode of
guarantee Currency
Amount
of original
currency
Amount
accounted into
RMB
Shenyang KEDA Clean
Energy Gas Co., Ltd.
KEDA Clean Energy Co., Ltd.,
Shenyang Gas Co., Ltd.
Warranted
guarantee RMB 17,916,668.11 17,916,668.11
Anhui Xincheng Financing
and Leasing Co., Ltd. KEDA Clean Energy Co., Ltd.
Warranted
guarantee RMB 159,296,426.34 159,296,426.34
Total 177,213,094.45 177,213,094.45
Remarks 2 : Closing balance of the long-term loan is increased by 31.43% compared with opening balance, caused by the parent
company’s credit loan increased at Import & Export Bank of China.
26. Estimated liabilities
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Opening balance Closing balance Cause
Product quality assurance 1,337,032.46 1,016,584.28 Warranty costs pre-withdrawn
Total 1,337,032.46 1,016,584.28 /
Remarks: The forecast liabilities are the warranty costs pre-withdrawn by the subsidiary KEDA (Anhui) Clean Energy Co., Ltd.
27. Deferred earnings
√ Applicable □ Not applicableUnit: yuan, currency: RMB
ItemOpening
balance
Increment in
this period
Decrement in
this period
Closing
balanceCause
Government
subsidy 30,950,000.00 48,000,000.00 9,545,000.00 69,405,000.00
Special fund granted
by the government
Total 30,950,000.00 48,000,000.00 9,545,000.00 69,405,000.00 /
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 87Annual Report 201586
29. Share capital
Unit: yuan, currency: RMB
Opening
balance
Increment or decrement in this period(+, -)
Closing
balanceNew shares
issued
Share
bonus
Public reserve
fund converted
into shares
Others Subtotal
Total number of shares 697,227,161.00 8,505,000.00 8,505,000.00 705,732,161.00
Remarks: The capital share increased by 8,505,000.00 yuan in this period is caused by the 3rd time of option exercising of 8.505
million shares in accordance with the Incentive Plan of Phase-2 Stock Option of the Company on May 19, 2015.
Private placement raised 80,202,150.00 yuan, including share capital of 8,505,000.00 yuan, and share premium of
71,697,150.00 yuan.
30. Capital reserve
Unit: yuan, currency: RMB
Item Opening balance Increment Decrement in
this period Closing balance
Capital premium (share
capital premium) 1,016,783,356.41 107,142,733.59 224,369.08 1,123,701,720.92
Other Capital reserve 107,749,011.96 11,760,236.46 32,115,207.68 87,394,040.74
Total 1,124,532,368.37 118,902,970.05 32,339,576.76 1,211,095,761.66
Remarks 1: Capital reserve-capital premium increased in this period: 103,812,357.68 yuan includes premium 71,697,150.00 yuan
that exercising of the 8.50 million shares of stock option for the 3rd time for private placement in Phase-II Stock Option
Incentive Plan by the Company on May 19, 2015, and 32,115,207.68 yuan carried forward to other Capital reserve by
former share payment; additional 3,330,375.91 yuan is caused by adjustment of Capital reserve by increasing capital
for Foshan KEDA Hydraulic Co., Ltd. deregistering Emeishan KEDA Clean Energy Co., Ltd., and increasing capital for
Foshan Do Better Machinery Co., Ltd. by Foshan Henglitai Machinery Co., Ltd.
Remarks 2: Capital public reserve-share capital premium decreased by 224,369.08 yuan caused by the Company’s acquiring
minority equity of the subsidiary Changsha Aer Compressor Co., Ltd.
Remarks 3: Capital public reserve-increased in this period 11,760,236.46 yuan, caused by the 37th Conference of the 4th Session
of Board of Director and the 1st extraordinary general meeting of the Company in 2012 passed the Phase-II Stock
Option Incentive Plan (Draft Revision). According to relevant rules and regulations in Enterprise Accounting Code
No.11-Payment of Shares, costs of the stock option during the waiting period are accounted into Capital reserve.
Refer to Annotation XII on computation.
Remarks 4: Capital public reserve-others, decreased by 32,115,207.68 yuan in this period, caused by the 37th Conference of the
4th Session of Board of Director and the 1st extraordinary general meeting of the Company in 2012 passed the Phase-
II Stock Option Incentive Plan (Draft Revision). According to relevant rules and regulations in Enterprise Accounting
Code No.11-Payment of Shares, the stock option is carried forward to the amount formerly accounted into other
Capital reserve when the stock option is exercised.
Item Closing balance Opening balance
Research and industrialization of production technology and outfit for thin
ceramics brick 800,000.00 800,000.00
R & D, promotion and application of clean coal gasification technology
and outfit 600,000.00 600,000.00
R & D, promotion and application of efficient and energy full-automatic
polishing production line 600,000.00
Key technology R & D of powder coal gasification based on fly ash
gradient utilization 500,000.00
Demonstration project of a new generation of numerical control machinery
of Guangdong Province 400,000.00
Performance construction project of engineering technology R & D Center
of Guangdong Province 400,000.00 400,000.00
Special fund support for modal demonstration of intellectual property
rights of Guangdong Province 300,000.00 300,000.00
Experiment center of powder press 100,000.00 200,000.00
Multifunctional hydraulic axial plunger pump 200,000.00 200,000.00
Research of industrial standard of roller kiln firing kiln 150,000.00 150,000.00
New low-tonnage ceramics brick press 130,000.00 130,000.00
Project of combination of industry and information 100,000.00 100,000.00
Work expenses for doctors for scientific research projects 16,332.67 50,000.00
R & D and industrialization of embedding numerical control deep ceramic
processing machinery and outfit 1,500,000.00
Research, manufacturing and industrialization of hi-end intelligent bi-
directional pressurized fire bricks automatic hydraulic machine 2,500,000.00
Industrialization project of nitration technology and complete equipment of
industrial kiln 5,000,000.00
R & D and industrialization project of complete steel slag grinding
equipment 3,000,000.00
NOX high-temperature and low-cost material reduction and technical
model project of cement kiln1,510,000.00
R & D and industrialization of solution and complete set of NOX emission
reduction of cement kiln 3,000,000.00
SNCR denitration pilot scale test and model project research of tail smoke
of cement kiln 410,000.00
R & D of completion solution and complete equipment for NOX emission
reduction of glass melting kiln 1,200,000.00
Leader talent project of Jiangsu Kehang 150,000.00
Manufacturing of completion equipment for desulfurization and denitration
of smoke removed of dust 1,800,000.00
Subsidy for infrastructure construction of Ningxia Kehang 5,120,512.40
R & D and industrialization project of desulfurization and denitration of
smoke removed of dust 5,085,000.00
New 2-sectional bi-directional flow electrolyte smoke purification
technology 500,000.00
Key technology for energy conservation and environmental protection
high-temperature circular fluidization bed 500,000.00
Innovation fund of KEDA Dongda 600,000.00
Total 92,355,735.34 74,409,247.24
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 89Annual Report 201588
34. Business income and business cost Unit: yuan, currency: RMB
Item Amount in this period Amount last periodIncome Cost Income Cost
Main business 3,588,815,903.50 2,771,927,950.31 4,463,356,668.01 3,402,793,993.62
Other business 4,868,355.32 4,134,419.77 2,519,219.34 923,005.33
Total 3,593,684,258.82 2,776,062,370.08 4,465,875,887.35 3,403,716,998.95
Main products (subject to products) Unit: yuan Currency: RMB
Product description Amount in this period Amount in last period
Business revenue Business cost Business revenue Business cost
Building material machinery
2,449,025,910.54 1,904,373,795.52 3,463,596,746.83 2,595,289,545.52
Cleaning and environmental protection equipment
849,036,041.39 603,456,318.84 680,875,417.10 487,834,590.35
Cleaning energy service 107,210,225.98 201,153,890.54 112,949,775.33 238,168,551.75
Financing and leasing 155,651,974.21 42,500,609.98 166,287,273.63 54,923,752.48
Other equipment 27,891,751.38 20,443,335.43 39,647,455.12 26,577,553.52
Total 3,588,815,903.50 2,771,927,950.31 4,463,356,668.01 3,402,793,993.62
Main business (subject to areas) Unit: yuan Currency: RMB
Area Amount in this period Amount last period
Business income Business cost Business income Business cost
Domestic 2,851,210,134.05 2,250,206,196.15 3,905,253,296.77 3,013,407,341.94
Overseas 737,605,769.45 521,721,754.16 558,103,371.24 389,386,651.68
Total 3,588,815,903.50 2,771,927,950.31 4,463,356,668.01 3,402,793,993.62
Remarks: Total sales of the top customers is 623.4293 million yuan (tax excluded), accounting for 17.35% of sales revenue.
35. Business tax and extra Unit: yuan, currency: RMB
Item Amount in this period Amount in last period
Business tax 2,923,985.44 780,105.02
Urban maintenance and cost tax 13,414,504.85 15,064,199.22
Education fee extra 9,729,649.04 10,965,748.47
Dike fee 2,548,579.88 2,268,456.98
Total 28,616,719.21 29,078,509.69
36. Sales expenseUnit: yuan, Currency: RMB
Item Amount in this period Amount in last period
Staff remuneration 78,491,755.07 83,122,402.71
Traveling expenses 25,546,446.26 28,370,055.60
Transport expenses 31,773,469.54 30,097,062.18
Entertainment expenses 6,031,004.91 6,040,768.73
Ad. and business publicity expenses 7,595,632.26 10,524,522.32
After-sales service fee 23,189,023.74 20,004,983.27
Others 34,775,290.26 30,072,086.01
Total 207,402,622.04 208,231,880.82
31. Other comprehensive earnings
√ Applicable □ Not applicableUnit: yuan, currency: RMB
ItemOpening
balance
Amount occurred in the period
Closing
balance
Before-
tax amount
occurred in
the current
period
Minus: amount
accounted
into other
comprehensive
earnings in previous
periods and
transferred into
gains and losses in
the current period
Minus:
income
tax
expenses
After-tax
attributed to
the parent
company
After-tax
attributed
to minority
shareholders
I. Other comprehensive earnings not reclassified into gains or
losses in the future
Wherein: changes from re-computing and re-defining net liabilities and
net assets of the defined benefit plan
Share of other comprehensive earnings not reclassified into gains or
losses for the invested party under the equity law
II. Other comprehensive earnings reclassified into gains or losses
in the future 4,942,261.95 -3,946,915.40 -3,946,915.40 995,346.55
Wherein: share of other comprehensive earnings reclassified into gains
or losses for the invested party under the equity law
Gains or losses from change of fair value of available-for-sale financial
assets
Gains or losses for held-to-maturity reclassified into available-for-sale
financial assets
Effective portion from gains or losses of cash flow hedging
Difference from conversion of foreign currency financial statements 4,942,261.95 -3,946,915.40 -3,946,915.40 995,346.55
Other comprehensive earnings in total 4,942,261.95 -3,946,915.40 -3,946,915.40 995,346.55
32. Surplus reserve Unit: yuan, currency: RMB
Item Opening balanceIncrement in this
period
Decrement in
this period Closing balance
Statutory Surplus reserve 220,424,735.10 24,877,067.10 245,301,802.20
Discretionary Surplus
reserve 10,168,213.70 10,168,213.70
Total 230,592,948.80 24,877,067.10 255,470,015.90
33. Undistributed profits Unit: yuan, currency: RMB
Item The current period The last period
Adjust undistributed profit at the end of the last period 1,557,980,890.20 1,266,602,748.66
Adjust total undistributed profit at the beginning of the period
(increment marked with +, decrement marked with -).
Undistributed profit at the beginning of the period after adjustment 1,557,980,890.20 1,266,602,748.66
Add: net profit attributed to parent company’s owners in the period 541,317,578.26 446,104,686.59
Minus: withdraw statutory Surplus reserve 24,877,067.10 37,684,577.68
Withdraw discretionary Surplus reserve
Withdraw general risk reserve
Dividend of ordinary shares payable 139,445,432.20 117,041,967.37
Dividend of ordinary shares converted into capital share
Undistributed profit at the end of the period 1,934,975,969.16 1,557,980,890.20
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 91Annual Report 201590
40. Investment earnings
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Amount in this period Amount in last period
Earnings of long-term equity investment computed according to the equity method
50,019,378.05 64,718,670.43
Earnings of investment from disposal of long-term equity investment
658,333,241.73 -163,924.55
Earnings of investment of financial assets measured with fair value and changes accounted into current profits and losses during the holding period
Earnings of investment from disposal of financial assets measured with fair value and changes accounted into current profits and losses
Earnings of investment of held-to-maturity during the holding period
Earnings of investment acquired from available-for-sale financial assets
Earnings of investment from disposal of available-for-sale financial assets
After losing the control, gains from re-measurement of fair value of remaining equity
Total 708,352,619.78 64,554,745.88
Remarks 1: Earnings of long-term equity investment computed with the equity method Unit: yuan Currency: RMB
Invested party Amount in this period Amount last period
Jiangyin Tianjiang Pharmaceutical Co., Ltd. 50,078,791.62 65,286,176.13
Guangdong Taiwei Digital Ceramics Printing Co., Ltd. -59,413.57 -567,505.70
Total 50,019,378.05 64,718,670.43
Remarks 2: Earnings of investment from disposal of long-term equity investment
Invested party Amount in this period
Jiangyin Tianjiang Pharmaceutical Co., Ltd. 664,177,590.17
Linyi KEDA Clean Energy Co., Ltd. -3,590,718.98
Emeishan KEDA Clean Energy Co., Ltd. -2,253,629.46
Total 658,333,241.73
41. Non-business revenue Unit: yuan, currency: RMB
Item Amount in this
period
Amount last
period
Amount accounted into non-recurring
gains and losses in current period
Gains from disposal of non-current assets in total 3,249,907.50 522,596.81 3,249,907.50
Wherein: gains from disposal of fixed assets 3,249,907.50 522,596.81 3,249,907.50
Gains from disposal of intangible assets
Gains from debt reconstruction
Government subsidy 78,313,724.07 51,560,369.40 78,313,724.07
Fine income 1,189,305.31 2,105,118.35 1,189,305.31
Late fee
Others 6,229,183.97 3,410,900.46 6,229,183.97
Total 88,982,120.85 57,598,985.02 88,982,120.85
37. Overhead Unit: yuan, Currency: RMB
Item Amount in this period Amount in last period
Staff remuneration 79,034,681.90 72,476,802.25
Office expenses 12,485,081.58 14,638,190.20
Water and electricity charges 7,829,049.84 6,445,428.52
Traveling expenses 10,012,329.60 8,524,756.86
Audit and consultancy fee 12,728,965.13 10,416,033.52
Tax 21,088,273.81 23,088,551.23
Depreciation and rent 43,782,826.79 40,715,467.26
Labor premiums 14,652,094.57 13,444,973.13
Amortization of intangible assets 18,368,016.89 11,674,402.17
R & D expenses of new products 136,758,946.23 107,785,398.24
Stock incentive fee 11,760,236.46 18,264,947.83
Others 38,180,732.94 29,417,151.82
Total 406,681,235.74 356,892,103.03
38. Financial costs Unit: yuan, currency: RMB
Item Amount in this period Amount in last period
Interest expenses 42,452,058.08 29,539,532.65
Minus: interest income -7,925,772.39 -6,985,111.51
Exchange gains and losses -9,856,798.53 -2,023,117.20
Handling charge 5,022,810.24 3,635,078.24
Total 29,692,297.40 24,166,382.18
39. Asset impairment losses
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Amount in this period Amount in last period
I. Non-performing debt losses 133,706,344.46 42,345,253.97
II. Stock depreciation losses 1,634,229.64
III. Losses from depreciation of available-for-sale financial
assets
IV. Losses from depreciation of held-to-maturity investment
V. Losses from depreciation of long-term equity investment
VI. Losses from depreciation of investment property
VII. Losses from depreciation of fixed assets
VIII. Losses from depreciation of project materials
IX. Losses from depreciation of projects under construction
X. Losses from depreciation of productive biological assets
XI. Losses from depreciation of oil and gas assets
XII. Losses from depreciation of intangible assets
XIII. Losses from depreciation of goodwill 65,407,924.98 5,223,932.12
XIV. Others
Total 199,114,269.44 49,203,415.73
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 93Annual Report 201592
Remarks: The non-business expenses in this period is increased by 1,806.16% compared with the amount in the last period,
mainly caused by losses from disposal of Emeishan KEDA Clean Energy Co., Ltd., Linyi KEDA Clean Energy Co., Ltd.
and Anhui Jiufu New Wall Material Co., Ltd.
43. Income tax expenses
(1) List of income tax expenses Unit: yuan, currency: RMB
Item Amount in this period Amount last period
Current income tax expenses 148,368,778.12 95,655,230.81
Deferred income tax expenses -21,120,513.92 -11,549,240.15
Total 127,248,264.20 84,105,990.66
(2) Adjustment process of accounting profit and income tax expenses: Unit: yuan, currency: RMB
Item Amount in this period
Total profit 659,037,279.31
Income tax expenses computed in accordance with statutory/applicable tax rate 98,855,591.90
Influences by different tax rate applied to subsidiaries 1,496,486.58
Influences by adjustment of income tax in previous periods 1,469,039.56
Influences by non-taxable income -31,907,093.45
Influences by non-deductible costs, expenses and losses 12,481,473.10
Influences by deductible losses of deferred income tax assets not confirmed before use
Influences by deductible temporary difference or deductible losses of the current deferred
income tax assets not confirmed 49,885,678.76
Change of balance of opening deferred income tax assets/liabilities by adjustment of tax
rate
Influences by deduction of R & D expenses -5,032,912.25
Subsidiaries pay the current income tax expenses according to quota
Income tax expenses 127,248,264.20
44. Items of cash flow statement
(1).Cash received related to business activities: Unit: yuan, currency: RMB
Item Amount in this period Amount last period
Government subsidy 95,978,558.32 42,584,019.44
Interest income 7,925,772.39 5,993,625.18
Others 96,391,421.65 1,931,607.02
Total 200,295,752.36 50,509,251.64
Remarks: Other cash received related to business activities in this period is increased by 296.55% compared with the last
period, mainly caused by significant increasing of government subsidy received, the current accounts 60.70 million
yuan from Jiangsu Kehang Environmental Protection Co., Ltd., and the current account 20.00 million yuan from
Ningxia Kehang Environmental Protection Group.
Government subsidy accounted into current profits and losses
√ Applicable □ Not applicable Unit: yuan, currency: RMB
Subsidized projects Amount occurred
in this period
Amount occurred
in last period
Related to assets/
related to earnings
Complete outfit and technology reconstruction for new energy conservation and environmental protection wall materials of KEDA Clean Energy
735,000.00 2,940,000.00 Related to assets
Large aluminum alloy extrusion and casting outfit and research project of KEDA Clean Energy
2,600,000.00 Related to earnings
Corporate support fund of Henglitai Headquarters 3,701,908.64 Related to earnings
R & D support for technical reconstruction of production equipment of large-sized ceramics thin plate of KEDA Clean Energy
510,000.00 510,000.00 Related to assets
R & D support for Newpower clean coal gasification system of KEDA (Anhui) Clean Energy
3,500,000.00 3,500,000.00 Related to assets
Special fund support for circularization reconstruction pilot of Shenyang City 3,300,000.00 Related to assets
Corporate support fund by economic promotion bureau of Leping Town, Sanshui District for Henglitai
1,500,000.00 Related to assets
Gas environmental protection and investment project of Shenyang KEDA Clean Energy
850,432.25 Related to assets
Corporate support fund of Maanshan Economic and Technology Development Zone
23,341,924.05 25,397,213.80 Related to earnings
Comprehensive utilization projects of iron tailings 5,000,000.00 Related to earnings
Special fund for supporting corporate’s merging and acquiring international famous brands and promoting foreign trade upgrading
3,000,000.00 Related to earnings
Quality award of provincial government of Guangdong Province 2,000,000.00 Related to earnings
Financial bonus by KEDA (Anhui) Industrial 3,290,000.00 Related to earnings
Government subsidy for technical reconstruction of high-end intelligence ceramics brick press
2,700,000.00 Related to earnings
Income from differential electricity price of KEDA Clean Energy 1,000,000.00 Related to earnings
Special fund of treasury of Shunde District of Foshan City 4,627,418.00 Related to earnings
Key technology R & D, and application of digitalized ceramics roller kilin 1,000,000.00 Related to earnings
Industrial support fund of Wuhu KEDA 6,227,700.00 4,403,740.00 Related to earnings
Provincial support fund for advanced outfit and equipment manufacturing industry at West Zhujiang Bank in 2015
1,375,000.00 Related to earnings
Advanced outfit project for hi-tech new wall materials 1,000,000.00 Related to earnings
Award fund of government of Yancheng City 1,478,200.00 Related to earnings
Special fund for advanced outfit manufacturing industry development of Sanshui District of Foshan City
3,570,000.00 Related to earnings
Environmental Protection Subsidy of Shenyang Environmental Protection Department
1,175,000.00 Related to earnings
Corporate support award fund of Sanshui District of Foshan City 2,096,073.98 Related to earnings
Other financial bonus 6,211,975.79 7,332,506.96 Related to earnings
Total 78,313,724.07 51,560,369.40 /
42. Non-business expenses Unit: yuan, currency: RMB
Item Amount in this
period
Amount last
period
Amount accounted into current
non-recurring gains and losses
Total losses from disposal of non-current assets 56,401,117.35 1,927,113.49 56,401,117.35
Wherein: losses from disposal of fixed assets 56,401,117.35 1,927,113.49 56,401,117.35
Losses from disposal of intangible assets
External donation 338,511.12 525,000.00 338,511.12
Late fee and fine 391,504.28 848,807.78 391,504.28
Others 27,281,073.48 1,127,467.48 27,281,073.48
Total 84,412,206.23 4,428,388.75 84,412,206.23
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 95Annual Report 201594
45. Additional data of cash flow statement
(1) Additional data of cash flow statementUnit: yuan, Currency: RMB
Additional data Amount in periodAmount in the
last period
1. Net profits adjusted to cash flow of business activities
Net profit 531,789,015.11 428,205,948.44
Add: asset depreciation reserve 199,114,269.44 49,203,415.73
Fixed asset depreciation, oil and gas assets depreciation and productive
biological asset depreciation 129,060,317.40 113,322,473.20
Amortization of intangible assets 17,683,211.31 13,844,084.35
Amortization of long-term costs to be amortized
Losses from disposal of fixed assets, intangible assets and other long-term assets
(profits marked with “-”) 53,151,209.85 1,404,516.68
Losses from scrapping of fixed assets (profits marked with “-”)
Losses from change of fair value (profits marked with “-”)
Financial costs (profits marked with “-”) 75,095,869.53 72,639,633.79
Investment losses (earnings marked with “-”) -708,352,619.78 -64,554,745.88
Decreasing of deferred income tax assets (increasing marked with “-”) -19,666,200.77 -10,750,685.45
Increasing of deferred income tax liabilities (decreasing marked with “-”) -1,454,313.15 -798,554.70
Decreasing of stock (increasing marked with “-”) 1,845,446.74 -4,779,165.02
Decreasing of business receivables (increasing marked with “-”) -135,212,519.63 -514,580,642.75
Increasing of business payables (decreasing marked with “-”) 410,124,882.28 -385,679,132.51
Others 11,760,236.46 18,264,947.83
Net amount of cash flow from business activities 564,938,804.79 -284,257,906.29
2. Significant investment and raising activities not involving cash deposit and
withdrawal:
Debt converted into capital
Convertible corporate bonds due in 1 year
Leased financial assets through leasing
3. Net change of cash and cash equivalent:
Closing balance of cash 586,057,257.55 257,948,223.08
Minus: opening balance of cash 257,948,223.08 425,418,904.39
Add: closing balance of cash equivalent
Minus: opening balance of cash equivalent
Net increment of cash and cash equivalent 328,109,034.47 -167,470,681.31
(2) Net cash amount paid for acquiring subsidiaries in this period
√ Applicable □ Not applicableUnit: yuan, Currency: RMB
Amount
Cash or cash equivalent for enterprise merging paid in this period 195,850,000.00
Wherein: cash paid for merging and acquiring Jiangsu Kehang Environmental Protection
Science & Technology Co., Ltd. 180,000,000.00
Cash paid for merging and acquiring Zhangzhou Juming Graphite Co., Ltd. 15,850,000.00
Minus: cash and cash equivalent held by subsidiaries on the date of acquiring 36,640,781.07
Wherein: cash held by Jiangsu Kehang Environmental Protection Science & Technology
Co., Ltd. on the date of acquiring 28,626,983.26
Cash paid for merging and acquiring Zhangzhou Juming Graphite Co., Ltd. 8,013,797.81
Add: cash or cash equivalent paid in this period for enterprise merging in past periods
Net cash amount paid for acquiring subsidiaries 159,209,218.93
Notes:
(2).Other cash paid related to business activities: Unit: yuan, Currency: RMB
Item Amount in this period Amount last period
Office fees 18,326,385.11 15,500,934.70
Water and electricity charges 48,439,718.40 56,108,640.06
Traveling expenses 41,214,764.25 43,370,395.31
Automobile fees 7,804,422.03 8,517,201.44
Transport costs 34,368,572.28 35,845,943.44
Entertainment expenses 11,592,971.37 10,887,350.87
Rent 5,812,206.71 4,097,270.60
Repair costs 24,740,694.42 27,433,523.49
Ad. costs and business publicity costs 3,197,858.21 3,779,072.36
Audit and consultancy costs 12,333,581.59 10,570,933.52
Forestation and environmental protection costs 5,975,045.93 2,527,197.08
Securities costs 1,340,159.26 2,391,652.24
Others 18,622,929.98 16,904,578.94
Total 233,769,309.54 237,934,694.05
(3).Other cash received related to investment activities Unit: yuan, Currency: RMB
Item Amount in this period Amount last period
Short-term financing products by bank 107,000,000.00
Total 107,000,000.00
Remarks: Other cash received related to investment activities is the cash received from redemption of due bank financing
products.
(4).Other cash received related to fund raising activities Unit: yuan, Currency: RMB
Item Amount in this period Amount last period
Acceptance draft security 89,556,931.12 61,744,749.74
Bid security 28,591,429.41 11,506,026.90
Equipment mortgage security 10,457,000.00 2,980,000.00
The Buyer’s credit loan security 50,037,901.60 34,282,344.60
Fixed deposit receipt 11,000,000.00 4,000,000.00
Total 189,643,262.13 114,513,121.24
(5).Other cash paid related to fund raising activities Unit: yuan, Currency: RMB
Item Amount in this period Amount last period
Acceptance draft security 99,547,079.52 81,918,753.43
Bid security 25,463,397.24 17,596,715.88
Equipment mortgage security 16,773,000.00
The Buyer’s credit loan security 36,196,100.00 34,420,728.00
Cash paid to minority shareholders due to capital reduction
by the subsidiary Changsha Aer Company 9,109,900.00
Total 161,206,576.76 159,819,097.31
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 97Annual Report 201596
(2) Description of overseas business entities, including key overseas business entities, the main overseas business location, standard currency for accounting and basis for selection shall be disclosed, and the cause shall be disclosed if the standard currency for accounting has been changed.
√ Applicable □ Not applicable
VIII. Change of scope of merging 1. Merging of enterprises not under the same control √ Applicable □ Not applicable(1). Merging of enterprise not under the same control occurred in this period √ Applicable □ Not applicable
Unit: 10 thousand yuan Currency: RMB
The purchased party
Date of
equity
acquired
Cost of
equity
acquired
Ratio of
equity
acquired
(%)
Equity
acquired
via
Date of
purchasing
Basis for determination of date
of purchasing
Revenue of the
purchased party from
the date of purchasing
to the end of the period
Net profit of the
purchased party from
the date of purchasing
to the end of the period
Jiangsu Kehang Environmental
Protection Science & Technology
Co., Ltd.
2015-09-23 18,000.00 72.00 Cash 2015-09-23
Registration for change at the
administration for industry and
commerce completed
21,099.34 3,265.35
Zhangzhou Juming Graphite Co.,
Ltd. 2015-11-25 2,280.00 100.00 Cash 2015-11-25
Registration for change at the
administration for industry and
commerce completed
316.16 -61.78
(2) Merging cost and goodwill √ Applicable □ Not applicable
Unit: 10 thousand yuan Currency: RMB
Merging costs
Jiangsu Kehang Environmental
Protection Science &
Technology Co., Ltd.
Zhangzhou Juming
Graphite Co., Ltd.
-Cash 18,000.00 2,280.00
-Fair value of non-cash assets
-Fair value of debts issued or assumed
-Fair value of equity securities issued
-Fair value of contingent consideration
-Fair value of equity held before the date of purchasing on the date of
purchasing
-Others
Merging cost in total 18,000.00 2,280.00
Minus: the share of fair value of identifiable net assets acquired 10,440.32 2,274.79
The amount that the goodwill/merging cost less than fair value of identifiable net assets 7,559.68 5.21
(3) Identifiable assets and liabilities of the purchased party on the date of purchasing √ Applicable □ Not applicable
Unit: 10 thousand yuan Currency: RMB
Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd.
Fair value on the date of buying Book value on the date of buying
Assets 89,393.03 82,151.07
Monetary fund 11,012.80 11,012.80
Accounts receivable 18,560.03 18,560.03
Instrument receivables 330.95 330.95
Accounts prepaid 9,122.94 9,122.94
Other receivables 7,071.66 7,071.66
Stock 9,061.18 9,061.18
Fixed assets 23,804.73 21,151.15
Intangible assets 9,831.86 5,243.48
Deferred income tax assets 596.88 596.88
(3) Composition of cash and cash equivalent Unit: yuan, Currency: RMB
Item Closing balance Opening balance
I. Cash 586,057,257.55 257,948,223.08
Wherein: cash on hand 1,398,467.47 1,028,897.06
Bank deposit used to pay from time to time 584,658,790.08 256,919,326.02
Other monetary fund used for payment from time to
tome
Amount deposited with the central bank for payment
Inter-bank deposit
Inter-bank offers
II. Cash equivalent
Wherein: bond investment due in 3 months
III. Cash and cash equivalent balance at the end of the perod 586,057,257.55 257,948,223.08
46. Assets with restricted title or use right
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Book value at the
end of the period
Cause for
restriction
Monetary fund 142,987,636.89 Used for pledging
Total 142,987,636.89 /
47. Foreign currency monetary items
√ Applicable □ Not applicable
(1) Foreign currency monetary items: Unit: yuan
Item Foreign currency balance
at the end of the period
Exchange rate
for conversion
Balance converted into RMB
at the end of the period
Monetary fund
Wherein: USD 1,178,031.28 6.50320 7,660,973.02
Euro 23,535.29 7.04830 165,883.78
HKD 218,869.07 0.83906 183,644.28
Accounts receivable
Wherein: USD 30,307,661.63 6.50320 197,096,785.11
Euro
HKD
Short-term loan
Wherein: USD 19,300,000.00 6.50320 125,511,760.00
Payables -
Wherein: USD 11,089,338.64 6.50320 72,116,187.04
Euro 17,000.00 7.04830 119,821.10
Accounts pre-received -
Wherein: USD 16,310,155.25 6.50320 106,068,201.62
Euro 1,021,621.50 7.04830 7,200,694.82
Other payables
Wherein: USD 2,089,636.62 6.50320 13,589,324.87
Accounts prepaid -
Wherein: USD 1,072,263.00 6.50320 6,973,140.74
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 99Annual Report 201598
IX. Equities in other entities
1. Equities in subsidiaries
√ Applicable □ Not applicable
(1).Composition of enterprise group
Full name of subsidiary Location of business Location of registration Nature of
business
Shareholding ratio (%)Acquired through
Direct Indirect
Foshan KEDA Stone Machinery
Co., Ltd.
Guanglong Industrial Park, Chencun
Town, Shunde District, Foshan City
Guanglong Industrial Park, Chencun
Town, Shunde District, Foshan City
Manufacturing
industry 100.00 Established
KEDA (Anhui) Industrial Co., Ltd.
Maanshan Economic and
Technological Development Zone,
Anhui Province
Maanshan Economic and
Technological Development Zone,
Anhui Province
Manufacturing
industry100.00 Established
Maanshan KEDA Xinmingfeng
Engineering Co., Ltd.
Maanshan Economic and
Technological Development Zone,
Anhui Province
Maanshan Economic and
Technological Development Zone,
Anhui Province
Manufacturing
industry 100.00 Established
KEDA (Anhui) Clean Energy Co.,
Ltd.
Maanshan Economic and
Technological Development Zone,
Anhui Province
Maanshan Economic and
Technological Development Zone,
Anhui Province
Manufacturing
industry68.44 Established
Shenyang KEDA Clean Energy
Gas Co., Ltd.
Liaoning Faku Economic Development
Zone
Liaoning Faku Economic Development
Zone
Manufacturing
industry 82.50 Established
Foshan KEDA Hydraulic Machinery
Co., Ltd. Dadu Village Committee Industrial Park
Dadu Village Committee Industrial
Park
Manufacturing
industry58.85 Established
Foshan Henglitai Machinery Co.,
Ltd.
Sanshui Central Science & Technology
Park of Foshan City
Sanshui Central Science &
Technology Park of Foshan City
Manufacturing
industry100.00
Merging of enterprises not
under the same control
Foshan Henglitai Labor
Dispatching Co., Ltd. Shancheng District, Foshan City Shancheng District, Foshan City
Manufacturing
industry100.00
Merging of enterprises not
under the same control
Anhui Xincheng Investment Co.,
Ltd.
Maanshan Economic Technology
Development Zone
Maanshan Economic Technology
Development Zone
Commercial
service
industry
100.00 Established
Anhui KEDA Suremaker Co., Ltd. Wuhu Machinery Industrial Park of
Anhui Province
Wuhu Machinery Industrial Park of
Anhui Province
Manufacturing
industry100.00
Merging of enterprises not
under the same control
Changsha Aer Compressor Co.,
Ltd.
Changsha Economic Technology
Development Zone of Hunan Province
Changsha Economic Technology
Development Zone of Hunan Province
Manufacturing
industry76.49
Merging of enterprises not
under the same control
Anhui KEDA Aer Compressor Co.,
Ltd.
Maanshan Economic Technology
Development Zone
Maanshan Economic Technology
Development Zone
Manufacturing
industry100.00 Established
Henan KEDA Dongda International
Engineering Co., Ltd. West Jianshe Road, Zhengzhou City West Jianshe Road, Zhengzhou City
Manufacturing
industry100.00
Merging of enterprises not
under the same control
Foshan Do Better Machinery Co.,
Ltd. Sanshui District, Foshan City Sanshui District, Foshan City
Manufacturing
industry50.76
Merging of enterprises not
under the same control
KEDA Industrial(Hong Kong) Co.,
Ltd. Hong Kong Hong Kong
Import and
export trade 100.00 Established
Guangdong Xincheng Financing
Leasing Co., Ltd. Shunde District, Foshan City Shunde District, Foshan City
Commercial
service
industry
52.73 47.27 Established
Anhui Kecheng Financing and
Leasing Co., Ltd.
Maanshan Economic Technology
Development Zone
Maanshan Economic Technology
Development Zone
Commercial
service
industry
52.73 47.27 Established
Jiangsu Kehang Environmental
Protection Science & Technology
Co., Ltd.
Yancheng Environmental Protection
Science & Technology Town of Jiangsu
Province
Yancheng Environmental Protection
Science & Technology Town of
Jiangsu Province
Manufacturing
industry72.00
Merging of enterprises not
under the same control
Ningxia KEHANG Environmental
Protection Engineering Co., Ltd. Pingluo, Ningxia Pingluo, Ningxia
Manufacturing
industry100.00
Merging of enterprises not
under the same control
Beijing KEHANG Environmental
Protection Technology Research
Institute Co., Ltd.
Beijing City Beijing City Manufacturing
industry100.00
Merging of enterprises not
under the same control
Anhui KEDA Clean Energy New
Materials Co., Ltd.
Maanshan Economic and
Technological Development Zone,
Anhui Province
Maanshan Economic and
Technological Development Zone,
Anhui Province
Manufacturing
industry 92.00 Establishment
Zhangzhou Juming Graphite Co.,
Ltd.
Chuanchang Town, Nanjing County,
Fujian Province
Chuanchang Town, Nanjing County,
Fujian Province
Manufacturing
industry 100.00
Merging of enterprises not
under the same control
Jiangsu Kehang Environmental Protection Science & Technology Co., Ltd.
Fair value on the date of buying Book value on the date of buying
Liabilities: 74,892.59 73,748.73
Short-term loan 20,635.00 20,635.00
Notes payable 15,135.87 15,135.87
Accounts payable 16,762.45 16,762.45
Accounts pre-received 7,487.61 7,487.61
Payroll payable 592.44 592.44
Tax payable 183.66 183.66
Other payables 3,043.70 3,043.70
Long-term loan 9,400.00 9,400.00
Deferred earnings 508.00 508.00
Deferred income tax liabilities 1,143.86
Net assets 14,500.44 8,402.34
Minus: minority shareholders’ equity
4,060.12 2,352.66
Net assets acquired 10,440.32 6,049.68
Unit: 10 thousand yuan, currency: RMB
Zhangzhou Juming Graphite Co., Ltd. Fair value on the date
of purchasing Book value on the date of
purchasing
Assets: 5,382.53 5,382.53
Monetary fund 801.38 801.38
Receivables 987.71 987.71
Accounts prepaid 41.32 41.32
Other receivables 85.23 85.23
Stock 970.81 970.81
Fixed assets 2,448.87 2,448.87
Intangible assets 47.21 47.21
Liabilities: 3,107.74 3,107.74
Short-term loan 529.43 529.43
Payables 618.37 618.37
Accounts pre-received 59.22 59.22
Payroll payable 21.06 21.06
Tax payable 18.41 18.41
Other payables 1,861.25 1,861.25
Net assets 2,274.79 2,274.79
Minus: minority shareholders’ equity
Net assets acquired 2,274.79 2,274.79
2. Change of scope of merging by other causes
Describe changes of scope of merging by other causes (such as: newly established subsidiaries and liquidating
subsidiaries) and related conditions.Unit: 10 thousand yuan Currency: RMB
Name of subsidiaries Causes for not listed in the
scope of mergingDate of
deregistration Net profit in this period
Emeishan Keda Clean Energy Co., Ltd. Deregistered 2015/12/24 -3,237.71
Linyi KEDA Clean Energy Co., Ltd. Deregistered 2015/04/22 -2,333.37
Anhui Jiufu New Wall Materials Co., Ltd. Deregistered 2015/12/09 -3,138.50
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 101Annual Report 2015100
③ On July 31, 2015, the Company purchased equity of 0.15% held by Liu Zhantang of Foshan Keda Hydraulic
Machinery Co., Ltd. at the price of 343 hundred yuan; on October 12, 2015, the Company purchased equity of 0.15%
held by Yang Beibei of Foshan Keda Hydraulic Machinery Co., Ltd. at the price of 345 hundred yuan; on November 24,
2015, according to capital verification by Foshan Zhixin CPA Firm (capital verification report: ZXYZ (2015) No. N1020), the
Company and minority shareholders increased capital to Foshan KEDA Hydraulic Machinery; Co., Ltd. with 18.60 million
yuan and 9.15 million yuan. After the capital increasing, the Company’s shareholding ratio at KEDA Hydraulic is increased
from 51.00% of 58.85%.
(2) Influences on minority shareholders’ equity and owner’s equity attributed to the parent company by the
transaction Unit: 10 thousand yuan Currency: RMB
Foshan Do
Better Co.,
Ltd.
Foshan KEDA
Hydraulic
Machinery Co., Ltd.
Changsha Aer
Compressor
Co., Ltd.
Purchasing cost/disposal consideration 600.00 1,860.00 183.31
- Cash 600.00 1,860.00 183.31
- Fair value of non-cash assets
Purchasing cost/disposal consideration in total 600.00 1,860.00 183.31
Minus: shares of net assets of subsidiaries computed
according to equity ratio acquired/disposed of704.17 1,863.51 160.87
Difference -104.17 -3.51 22.44
Wherein: adjustment Capital reserve 104.17 3.51 -22.44
Adjust surplus Capital reserve
Adjust undistributed profits
3. Equity in joint venture or cooperative enterprise
√ Applicable □ Not applicable
(1).Financial information summary of insignificant joint venture or cooperative enterprise Unit: 10 thousand yuan Currency: RMB
Closing balance/
Amount in this period
Opening balance/
Amount last period
Joint venture
Investment book value in total: 50.45 825.80
Total amount computed in accordance with the shareholding ratios:
- Net profit -14.85 -141.88
- Other comprehensive earnings
- Total comprehensive earnings -14.85 -141.88
X. Risks related to financial instruments
√ Applicable □ Not applicable
(I) Contents and policies of risk management
The Company’s main financial instruments include receivables, payables and bank loan etc. Risks related to these
financial instruments and risk management policy adopted by the Company to lower these risks are described as follows. The
Company’s management manages and monitors risk exposures and ensures that the risks are controlled within limit scope.
1.Market risks
(1) Interest rate risks-risks of change of fair value. The risk from change of fair value of financial instruments by
change of interest rate is from short-term loan with fixed interest rate. For the loan with fixed interest rate is short-term
loan; therefore, the Company holds the opinion that, fair interest rate risk is not significant. The Company does not have
interest rate hedging policy.
(2) Significant non-fully-owned subsidiaries Unit: 10 thousand yuan Currency: RMB
Names of subsidiaries
Shareholding
ratio of
minority
shareholders
(%)
Profits and
losses attributed
to minority
shareholders in
this period
Dividend declared
and issued
to minority
shareholders in
this period
Balance of
minority
shareholders’
equity at the end
of the period
Shenyang KEDA Clean Energy Gas
Co., Ltd. 17.50 -2,041.06 676.55
KEDA (Anhui) Clean Energy Co., Ltd. 31.56 1,686.35 16,606.63
Jiangsu Kehang Environmental
Protection Science & Technology Co.,
Ltd.
28.00 914.30 4,974.42
(3) Main financial information of significant and non-fully-owned subsidiaries Unit: 10 thousand yuan Currency: RMB
Names of
subsidiaries
Closing balance Opening balance
Current
assets
Non-current
assets
Assets in
total
Current
liabilities
Non-current
liabilities
Liabilities in
total
Current
assets
Non-current
assets
Assets in
total
Current
liabilities
Non-current
liabilities
Liabilities
in total
Shenyang KEDA
Clean Energy
Gas Co., Ltd.
24,466.53 83,960.32 108,426.85 98,943.80 5,617.06 104,560.86 19,601.40 81,681.00 101,282.40 75,616.62 10,136.60 85,753.22
KEDA (Anhui)
Clean Energy
Co., Ltd.
65,782.41 17,748.86 83,531.27 28,710.36 2,201.66 30,912.02 56,443.14 20,590.87 77,034.01 27,174.38 2,583.70 29,758.08
Jiangsu Kehang
Environmental
Protection
Science &
Technology Co.,
Ltd.
60,118.24 33,326.28 93,444.52 71,434.31 4,244.42 75,678.73 55,159.57 34,233.46 89,393.03 61,733.73 13,158.86 74,892.59
Names of subsidiaries
Amount in this period Amount last period
Business
revenue Net profit
Total
amount of
comprehensive
earnings
Cash flow
of business
activities
Business
revenue Net profit
Total
amount of
comprehensive
earnings
Cash flow
of business
activities
Shenyang KEDA Clean Energy
Gas Co., Ltd. 10,721.02 -11,663.18 -11,663.18 34,483.23 10,660.65 -15,092.49 -15,092.49 16,741.29
KEDA (Anhui) Clean Energy
Co., Ltd. 33,886.14 5,343.31 5,343.31 3,204.39 44,567.75 2,947.95 2,947.95 -14,366.85
Jiangsu Kehang Environmental
Protection Science &
Technology Co., Ltd.
21,099.34 3,265.35 3,265.35 23,555.99
2. Transaction of change of owner’s equity of subsidiaries and still controlling subsidiaries
√ Applicable □ Not applicable
(1) Description of change of owner’s equity shares of subsidiaries
① In January, 2015, Foshan Do Better Machinery Co., Ltd. increased capital of 16 million yuan, wherein, Henglitai
Company increased capital of 6 million yuan, and after capital increasing was completed, and the shareholding ratio was
increased from 55% to 50.7585%.
② In May, 2015, the Company purchased equity of 3.06% held by Li Xu of Changsha Aer Compressor Co., Ltd. at
the price of 1.8331 million yuan.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 103Annual Report 2015102
Continued:
Item
Opening balance
Book value Total amount Within 1 year 1-3 yearsMore than
3 years
Monetary fund 347,877,207.15 347,877,207.15 347,877,207.15
Accounts receivables 754,034,108.28 754,034,108.28 520,740,176.64 214,928,237.72 18,185,082.02
Accounts prepaid 128,128,041.36 128,128,041.36 108,004,997.94 18,401,519.00 1,721,524.42
Other receivables 38,653,715.75 38,653,715.75 27,944,341.76 7,765,414.00 2,943,959.99
Non-current assets due
in 1 year 1,279,002,174.13 1,279,002,174.13 1,279,002,174.13
Long-term receivables 469,000,529.24 469,000,529.24 469,000,529.24
Subtotal 3,016,695,775.91 3,016,695,775.91 2,283,568,897.62 710,095,699.96 22,850,566.43
Bank loan 1,674,391,827.23 1,674,391,827.23 1,395,747,002.08 278,644,825.15
Notes payable 373,808,839.79 373,808,839.79 373,808,839.79
Accounts payable 850,526,171.84 850,526,171.84 729,062,985.65 104,410,370.97 17,052,815.22
Other payables 33,835,598.11 33,835,598.11 20,992,504.99 10,839,501.03 2,003,592.09
Subtotal 2,932,562,436.97 2,932,562,436.97 2,519,611,332.51 393,894,697.15 19,056,407.31
4. Breaching risks
The Company’s credit standing is AA, and the Company has not involve any overdue repayment in the past several
years.
XI. Related parties and related transactions
1. Details of subsidiaries of the enterprise
Refer to annotations on details of subsidiaries of the enterprise. Unit: 10 thousand yuan, currency: RMB
Full name of subsidiaries Enterprise
typeLocation of registration
Legal
representative
Nature of
business
Registered
capital
Shareholding
ratio (%)
Voting
right
ratio(%)
Organization code
Foshan KEDA Stone
Machinery Co., Ltd.
Company
limited
Guanglong Industrial Park, Chencun
Town, Shunde District, Foshan City Xie Cheng
Manufacturing
industry1,695.00 100.00 100.00 74997519-2
KEDA (Anhui) IndustrialCo.,
Ltd.
Company
limited
Maanshan Economic and Technical
Development Zone of Anhui Province Chen Xinjiang
Manufacturing
industry68,000.00 100.00 100.00 67589409-X
Maanshan KEDA
Xinmingfeng Engineering
Co., Ltd.
Company
limited
Maanshan Economic and Technical
Development Zone of Anhui ProvinceXu Jianshe
Manufacturing
industry500.00 100.00 100.00 55016683-0
KEDA (Anhui) Clean Energy
Co., Ltd.
Joint-stock
company
Maanshan Economic and Technical
Development Zone of Anhui ProvinceLiu Xin
Manufacturing
industry4,460.00 68.44 68.44 66150396-7
KEDA (Anhui) Clean Energy
Gas Co., Ltd.
Company
limited
Liaoning Faku Economic
Development Zone Zhou Zubing
Manufacturing
industry40,000.00 82.50 82.50 55079226-8
Foshan KEDA Hydraulic
Machinery Co., Ltd.
Company
limited
Dadu Village Committee Industrial
Park of Chencun Town, Shunde
District, Foshan City
Yang JunManufacturing
industry3,850.00 58.85 58.85 56829058-1
Foshan Henglitai Machinery
Co., Ltd.
Company
limited
Sanshui Central Science &
Technology Industrial Zone of
Foshan City
Yang Xuexian Manufacturing
industry2,560.00 100.00 100.00 71239366-6
Foshan Henglitai Labor
Dispatching Co., Ltd.
Company
limitedShancheng District, Foshan City Chen Yulan
Service
industry200.00 100.00 100.00 58295434-8
Anhui Xincheng Investment
Co., Ltd.
Company
limited
Maanshan Economic and Technical
Development Zone Zhou Hehua
Commercial
service
industry
11,400.00 100.00 100.00 69867403-0
Anhui KEDA Xinmingfeng
IndustrialCo., Ltd.
Company
limited
Wuhu Machinery Industrial Park of
Anhui Province Shen Xiaohe
Manufacturing
industry2,000.00 100.00 100.00 66624276-X
Changsha Aer Compressor
Co., Ltd.
Company
limited
Changsha Economic and Technical
Development Zone of Hu’nan
Province
Zeng FeiManufacturing
industry2,608.00 76.49 76.49 75582796-2
(2) Interest rate risk-risk from change of cash flow. The risks related to change of cash flow of the financial
instruments by change of interest rate is mainly related to short-term loan and long-term loan with floating interest rate.
The Company’s policy is to maintain floating interest rate of these loans to eliminate risks from change of fair value of
interest rate.
2.Credit risks
Maximum credit risk exposure probably resulting in the Company’s financial losses is mainly caused the contract
parties’ failure to perform obligations, and losses are occurred to the Company’s financial assets.
Financial assets in the consolidated statement includes receivables. To lower credit risks, the Company establishes
a team to determine credit line, execute credit approval and other monitoring procedures to ensure that necessary
measures are adopted to recover creditor’s right overdue. Besides, on each date of balance sheet, the Company checks
recovery of each recoverable to ensure that the non-recovered amount is accrued for non-performing debt reserve.
3.Fluidity risks
The Company’s management properly monitors cash and cash equivalent to meet the Company’s business
requirements and lower influences on cash flow fluctuation.
The Company’s fund management department monitors the Company’s short-term and long-term fund
requirements and maintain sufficient fund reserves. Meanwhile, continue to monitoring whether they are in conformity with
the loan agreement, and obtain commitment on sufficient spare fund from financial institutes to meet short-term and long-
term fund requirements.
In summary, the Company’s management holds the opinion that, the fluidity risks assumed by the Company has
been lowered much, and do not constitute significant influences on business and financial statements. The financial
statements are prepared on the assumption of going concern.
Till December 31, 2015, the Company’s financial assets and financial assets are listed on dates with the
undiscounted contract cash flow.
Item
Closing balance
Book value Total amount Within 1 year 1-3 yearsMore than
3 years
Monetary fund 729,044,894.44 729,044,894.44 729,044,894.44
Accounts receivables 1,104,823,386.52 1,104,823,386.52 930,990,478.16 153,255,224.23 20,577,684.13
Accounts prepaid 210,486,474.33 210,486,474.33 179,036,961.81 27,665,425.46 3,784,087.06
Other receivables 135,973,904.93 135,973,904.93 120,597,650.57 13,050,067.76 2,326,186.60
Non-current assets due
in 1 year 1,136,341,034.72 1,136,341,034.72 1,136,341,034.72
Long-term receivables 380,428,530.53 380,428,530.53 380,428,530.53
Subtotal 3,697,098,225.47 3,697,098,225.47 3,096,011,019.70 574,399,247.98 26,687,957.79
Bank loan 966,565,815.04 966,565,815.04 600,352,720.59 366,213,094.45
Notes payable 430,184,109.88 430,184,109.88 430,184,109.88
Accounts payable 1,377,248,393.38 1,377,248,393.38 1,220,258,038.25 134,449,556.61 22,540,798.52
Other payables 87,811,359.23 87,811,359.23 79,436,511.95 6,954,253.46 1,420,593.82
Other current liabilities 105,990,000.00 105,990,000.00 105,990,000.00
Subtotal 2,967,799,677.53 2,967,799,677.53 2,436,221,380.67 507,616,904.52 23,961,392.34
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 105Annual Report 2015104
4. Details of related transactions
(1) Related transactions of purchasing and selling commodities, and offering and receiving labors
√ Applicable □ Not applicable
(2) Details of related consigned management/contracting and consigned management/contracting
√ Applicable □ Not applicable
(3) Details of related leasing
√ Applicable □ Not applicable
(4) Details of related guarantee
√ Applicable □ Not applicable
The Company acts as guarantor. Unit: 10 thousand yuan Currency: RMB
Guaranteed party Amount
guaranteed
Commencement
date of guarantee
Due date of
guarantee
Guarantee
expired or not
Anhui Xincheng Financing and Leasing Co., Ltd. 7,350.00 2015/6/29 2016/8/2 No
Anhui Xincheng Financing and Leasing Co., Ltd. 36,389.38 2015/10/27 2018/9/5 No
Foshan Do Better Machinery Co., Ltd. 1,500.00 2015/9/1 2016/9/1 No
Guangdong Xincheng Financing and Leasing
Co., Ltd. 800.00 2014/8/25 2016/4/4 No
Shenyang KEDA Clean Energy Gas. Co., Ltd. 2,112.50 2011/12/1 2016/2/19 No
Shenyang KEDA Clean Energy Gas. Co., Ltd. 5,791.67 2012/2/3 2017/2/2 No
KEDA (Anhui) Industrial Co., Ltd. 1,000.00 2015/12/8 2016/6/4 No
KEDA (Anhui) Clean Energy Co., Ltd. 6,690.00 2015/7/29 2016/6/25 No
Foshan Henglitai Machinery Co., Ltd. 964.00 2015/7/29 2016/6/25 No
Jiangsu Kehang Environmental Protection
Science & Technology Co., Ltd. 5,000.00 2015/11/13 2016/1/30 No
Unit: 10 thousand currency: USD
Guarantee party Amount
guaranteed
Commencement
date of guarantee
Due date of
guarantee
Guarantee
expired or not
Xincheng International (Hong Kong) Co., Ltd. 480.00 2015/9/2 2016/8/26 No
Xincheng International (Hong Kong) Co., Ltd. 500.00 2015/9/25 2016/9/14 No
(5) Interbank borrowing and lending of related parties
√ Applicable □ Not applicable
(6) Details of asset transfer and debt reconstruction of related parties
√ Applicable □ Not applicable
(7) Remuneration of key management staff
√ Applicable □ Not applicableUnit: 10 thousand yuan Currency: RMB
Item Amount in this period Amount last period
Remunerations of key managers 810.23 757.00
5. Receivables and receivables of related parties
√ Applicable □ Not applicable
(1) Payables Unit: 10 thousand yuan Currency: RMB
Item Related parties Closing book
balance
Opening book
balance
Accounts payable Guangdong Taiwei Digital Ceramics Printing Co., Ltd. 0 190.57
Other payables Guangdong Taiwei Digital Ceramics Printing Co., Ltd. 0 500.00
Full name of subsidiaries Enterprise
typeLocation of registration
Legal
representative
Nature of
business
Registered
capital
Shareholding
ratio (%)
Voting
right
ratio(%)
Organization code
Anhui KEDA Aer
Compressor Co., Ltd.
Company
limited
Maanshan Economic and Technical
Development ZoneZeng Fei
Manufacturing
industry2,000.00 100.00 100.00 07670846-X
Henan KEDA Dongda
International Engineering
Co., Ltd.
Company
limitedWest Jianshe Road, Zhengzhou City Zhao Pengxi
Manufacturing
industry5,000.00 100.00 100.00 70678565-5
Foshan Do Better Machinery
Co., Ltd.
Company
limitedSanshui District, Foshan City Hu Jianguo
Manufacturing
industry396.00 50.76 50.76 66496659-6
Jiangsu Kehang
Environmental Protection
Science & Technology Co.,
Ltd.
Company
limited
Yancheng Environmental Protection
Science & Technology Town of
Jiangsu Province
Liu HuaipingManufacturing
industry8,937.00 72.00 72.00 60861122-01
Ningxia Kehang
Environmental Protection
Engineering Co., Ltd.
Company
limitedPingluo, Ningxia Liu Huaiping
Manufacturing
industry5,000.00 100.00 100.00 57486843-01
Beijing Kehang
Environmental Protection
Technical Research Institute
Co., Ltd.
Company
limitedBeijing Liu Tongquan
Manufacturing
industry100.00 100.00 100.00 39988018-4
Anhui KEDA Clean Energy
New Materials Co., Ltd.
Company
limited
Dangtu Economic Development
Zone, Maanshan City, Anhui
Province
Hao LaichunManufacturing
industry1,000.00 92.00 92.00 91340521355187820D
Zhangzhou Juming Graphite
Co., Ltd.
Company
limited
Chuanchang Town, Nanjing County,
Fujian Province Wu Jianyun
Manufacturing
industry1,649.93 100.00 100.00 91350627717396444C
Unit: 10 thousand Currency: USD
Full name of subsidiaries Enterprise type Location of registration Legal
representative
Nature of
business
Registered
capital
Shareholding
ratio(%)
Voting
right
ratio (%)
KEDA Industrial(Hong Kong)
Co., Ltd. Company limited Hong Kong Bian Cheng
Import and
export trade 1,000.00 100.00 100.00
Guangdong Xincheng
Financing and Leasing Co.,
Ltd.
Company limited Shunde District, Foshan City Zhou Hehua
Commercial
service
industry
2,700.00 100.00 100.00
Anhui Xincheng Financing
and Leasing Co., Ltd. Company limited
Maanshan Economic and
Technical Development Zone Zhou Hehua
Commercial
service
industry
3,500.00 100.00 100.00
2. Details of joint venture and cooperative enterprise
Refer to annotation on key joint venture or cooperative enterprise of the enterprise. Unit: 10 thousand yuan Currency: RMB
Invested party Enterprise
type
Location of
registration
Legal
representative
Nature of
business
Registered
capital
Shareholding
ratio of the
enterprise
(%)
Voting share ratio
of the enterprise
at the invested
party (%)
Organization
code
II. Joint venture
Guangdong Taiwei
Digital Ceramics
Printing Co., Ltd.
Company
limited
Foshan,
Guangdong
Province
Xu Lei Manufacturing
industry2,000.00 40.00 40.00 59405878-6
3. Details of other related parties
√ Applicable □ Not applicable
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 107Annual Report 2015106
According to relevant rules and regulations on determination of fair value in Enterprise Accounting Code No.22-
Confirmation and Measurement of Financial Instruments, the Company selected Black-Scholes Model and the closing
price of KEDA Industrial on date of granting (March 8, 2012) to measure fair value of stock options of the Company.
(1) Stock option exercising price (X): the stock option price in the plan is 10.03 yuan.
(2) Price of date of granting: (S) :10.90 yuan.
(3) Effective period (T): effective period of stock option exercising is computed in accordance with the middle-point
methods, namely (period of option determination+ survival period)/2, and the results are 1.5 years, 2.5 years, 3.5 years
and 4.5 years.
(4) History fluctuation rat ( ): the value is 38.67% (Notes: history fluctuation rate 180 transaction dates before the
date of granting).
(5) Risk-free earnings rate (r): the nominal annual interest rate of the interest-bearing (Phase-III) national debt issued
on February 16, 2012 was used to replace the risk-free interest rate.
According to the above parameters, total theoretical amount corresponding to 36.30 million shares of stock option
in the equity incentive plan was 128.4608 million yuan, which would be amortized within 48 months. The Company
finished authorization on March 8, 2012, and the amortization costs from 2012 to 2016 is: Unit: 10 thousand yuan
Year 2012 2013 2014 2015 2016 Total
Amount influenced 5,050.97 4,055.54 2,399.98 1,176.02 163.57 12,846.08
According to Article 19 of Chapter 7 of Phase-II Stock Option Incentive Plan (Draft Revision): in case of dividend
payout, Capital reserve transferred to shares, stock dividend bonus, stock division and stock allocation involving KEDA
Industrial before stock options are exercised, the price for exercising stock options is adjusted correspondingly.
Reviewed and adopted by the Company’s shareholder’s conference for the year 2011, the profit distribution plan for
the year 2011 is described as follows: total share capital at the end of the year 632,011,700 as the base, cash dividend
1.00 yuan (tax included) per 10 shares is distributed to all shareholders. Therefore, after the profit distribution for the
year 2011, the stock option exercising price after the stock option incentive plan=stock option price before adjustment-
dividend distributed for each share =10.03-0.10=9.93 (yuan).
Reviewed and adopted by the Company’s shareholder’s conference for the year 2012, the profit distribution plan for
the year 2012 is described as follows: total share capital at the end of the year 651,666,541 as the base, cash dividend
1.30 yuan (tax included) per 10 shares is distributed to all shareholders. Therefore, after the profit distribution for the
year 2012, the stock option exercising price after the stock option incentive plan=stock option price before adjustment-
dividend distributed for each share =9.93-0.13=9.80 (yuan).
Reviewed and adopted by the Company’s shareholder’s conference for the year 2013, the profit distribution plan for
the year 2013 is described as follows: total share capital at the end of the year 688,482,161 as the base, cash dividend
1.70 yuan (tax included) per 10 shares is distributed to all shareholders. Therefore, after the profit distribution for the
year 2013, the stock option exercising price after the stock option incentive plan=stock option price before adjustment-
dividend distributed for each share =9.80-0.17=9.63 (yuan).
Reviewed and adopted by the Company’s shareholder’s conference for the year 2014, the profit distribution plan for
the year 2014 is described as follows: total share capital at the end of the year 688,482,161 as the base, cash dividend
2 yuan (tax included) per 10 shares is distributed to all shareholders. Therefore, after the profit distribution for the year
2014, the stock option exercising price after the stock option incentive plan=stock option price before adjustment-
dividend distributed for each share =9.63-0.20=9.43 (yuan).
XII. Payment of shares
1. Summary of payment of shares
√ Applicable □ Not applicableUnit: share, currency: RMB
Total amount of equity instruments granted by the
Company in this period 0
Total amount of equity instruments exercised by the
Company in this period8,505,000
Total amount of equity instruments invalidated for the
Company in this period0
Scope of exercisable price range of stock option
issued externally by the Company at the end of the
period and remaining period of the contract hereof
On May 29, 2015, the Company implemented the profit distribution plan
for the year 2014: total number of share capital 697,227,161 shares as
the base, and cash dividend of 2.00 yuan (tax included) per 10 shares
was distributed to all shareholders. After the plan was implemented, the
Company’s stock option exercising price was adjusted to 4.93 yuan.
Scope of exercisable price range of other equities
issued externally by the Company at the end of the
period and remaining period of the contract hereof
2. Payment of equity settled with equity Unit: 10 thousand yuan Currency: RMB
Method for determination of fair value of equity
instruments on the date of granting
In accordance with relevant rules and regulations on
determination of fair value in Enterprise Accounting Code No.22-
Confirmation and Measurement of Financial Instruments, the
Company selected Black-Scholes Model to determine fair value
of the stock option incentive plan on the date of granting.
Cumulative amount with share payment of equity
settlement and accounted into Capital reserve 12,109.03
Total costs confirmed for share payment of equity
settlement in this period 1,176.02
Filed by China Securities Regulatory Commission without objection, the 37th Conference of the 4th Session of the Board
of Directors on February 20, 2012 and the 1st extraordinary general meeting of the year 2012 on March 7, 2013 reviewed
and passed the Phase-II Stock Option Incentive Plan (Draft Revision). According to this incentive plan, 39.96 million shares
of stock options were granted to the incented objects, the stock option exercising price was 10.03 yuan, and effective
period of the stock option is 5 years after being granted. Within one year after being granted, the incented objects satisfying
the granting conditions can exercise the stock option. The incented object exercises the stock option granted in 4 phases
from the next date of transaction upon expiry of one year after being granted, and the incented object exercises the stock
options at the rate of 25% year by year. On March 8, 2012, the 38th Conference of the 4th Session of the Board of Directors
of the Company reviewed and passed the Proposal on Determination of Date of Granting of Phase-II Stock Option Incentive
Plan, and determined that the date of granting of Phase-II Stock Option Incentive Plan was March 8, 2012.
The 7th Conference of the 5th Session of Board of Director reviewed and passed the Proposal on Adjustment of
Quantity of Stock Option of Phase-II Stock Option Incentive Plan of the Company. Due to resignation of the staff Duan
Gaofeng etc. with 36 persons, exercising of 3.96 million shares of stock option was cancelled, quantity of incented object
was adjusted from 359 persons to 323 persons, and the stock option quantity was adjusted from 39.66 million shares to
35.70 million shares .
The 23rd Conference of the 5th Session of the Board of Directors of the Company reviewed and passed the Proposal
on Adjustment of Stock Option Exercising Price and Quantity of Phase-II Stock Option Incentive Plan. Due to resignation
of 6 persons such as resignation and death of Meng Chen because of illness, the exercising of 1.02 million shares of stock
option was cancelled. The quantity of incented objects of the Company was adjusted from 323 to 306 persons, and total
number of stock option not exercised was adjusted from 26.7750 million shares to 25.7550 million shares.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 109Annual Report 2015108
XV. Other key events
1. Correction of accounting errors in last period
□Applicable √Not applicable
2. Debt reconstruction
□Applicable √Not applicable
3. Asset swap
□Applicable √Not applicable
4. Annuity plan
□Applicable √Not applicable
5. Business termination
□Applicable √Not applicable
6. Partial information
□Applicable √Not applicable
7. Key transactions and events with influences on investor’s decision-making
None.
XVI. Annotation to main items of financial statements of parent company
1. Receivables
(1) Disclosure of classification of receivables: Unit: yuan, currency: RMB
Type
Closing balance Opening balance
Book balance Non-performing debt reserve
Book value
Book balance Non-performing debt reserve
Book valueAmount
Accrual
ratio
(%)
Amount Accrual
ratio (%)Amount
Accrual
ratio
(%)
Amount
Accrual
ratio
(%)
Receivables with significant single amount and non-performing debt reserve accrued
Goods payment of subsidiaries
219,167,711.94 67.14 219,167,711.94 256,523,428.38 59.22 256,523,428.38
Other receivables with non-performing debt reserve accrued according to credit risk feature portfolio
102,986,752.53 31.55 15,829,417.82 15.37 87,157,334.71 169,588,500.14 39.15 17,942,611.05 10.58 151,645,889.09
Receivables with insignificant single amount and non-performing debt reserve accrued
4,290,345.90 1.31 4,290,345.90 100.00 7,101,416.38 1.64 7,101,416.38 100.00
Total 326,444,810.37 100.00 20,119,763.72 6.16 306,325,046.65 433,213,344.90 100.00 25,044,027.43 5.78 408,169,317.47
Receivables with single significant amount with non-performing debt reserve accrued separately at the end of the
period:
□Applicable √Not applicable
XIII. Commitment and contingency
1. Key commitments
√ Applicable □ Not applicable
2. Contingencies
√ Applicable □ Not applicable
Key contingencies on the date of balance sheet
The Company cooperates with banks to sell products with equipment mortgage loan, the purchaser applies
for mortgage loan at the bank with the purchased equipment, the mortgage loan contract is no more than 70% of
goods payment, with maximum duration of 2 years, the security is deposited according to certain ratio, and is reduced
correspondingly with the loan.
During the reporting period, the Company’s sales through mortgage is 11.7960 million yuan. Till December 31,
2015, the client mortgage balance obliged and committed by the Company is 10.2190 million yuan, and overdue loan
balance is 1.08 million yuan.
XIV. Post balance sheet events
1. Key non-adjustments
□Applicable √Not applicable
2. Profit distribution
√ Applicable □ Not applicable
1. According to resolution of the 8th conference of the 6th Board of Directors held on June, 2016, the proposal of
profit plan and capita public reserve fund transferred to increase capital share for the year 2015 was passed: (1) the
profit distribution proposal: with total number of share capital 705,732,161.00 as the base, cash dividend 2.00 yuan (tax
included) for each 10 shares is distributed to all shareholders, and cash of 141,146,432.20 yuan is distributed. (2) The
proposal of Capital reserve transferred to increase capital: with total number of share capital 705,732,161.00 shares as
base, each 10 shares are used to increase additional 10 shares by capital transfer. The above resolutions shall be subject
to approval by the Shareholder’s Conference.
3. Post balance sheet events
During the reporting period, due to asset reconstruction under planning, the Company’s stock was suspended from
June 10, 2015 to October 25, 2015. The Company planned to issue stock to purchase assets exchange for minority
shareholders’ equity of KEDA (Anhui) Clean Energy and introduce strategic investors through supporting financing. On
December 10, 2015, the 5th Conference of the 6th Session of Board of Directors of the Company reviewed and passed the
Proposal on KEDA Clean Energy Co., Ltd. to Issue Shares, Purchase Assets and Raise Supporting Funds and Related
Transactions (Draft) and Summary; on December 28, 2015, the 3rd extraordinary general meeting of the year 2015 for
the Company reviewed and passed the Proposal on KEDA Clean Energy Co., Ltd. to Issue Shares, Purchase Assets and
Raise Supporting Funds; on December 30, 2015, the Company submitted the asset reconstruction materials to China
Securities Regulatory Commission for approval.
Greatly affected by fluctuation of stock A market, the Company’s stock price dropped down sharply. The parties
involving the reconstruction transactions had serious divergence over the reconstruction proposal, through several
times of communication, and the Company determined to terminate the asset reconstruction. On March 16, 2016,
the 7th Conference of the 6th Session of the Company reviewed and passed the Proposal on Termination of Asset
Reconstruction and Cancellation of the Reconstruction Application Document; on April 1, 2016, the Company convoked
the 1st extraordinary general meeting to pass the proposal, and submitted the Application on Cancellation of Asset
Reconstruction of Guangdong KEDA Clean Energy Co., Ltd to China Securities Regulatory Commission.; on April 26,
2016, China Securities Regulatory Commission issued the Notice on Termination of Review as Administration License
by China Securities Regulatory Commission ([2016] No.273). According to the Procedures of Administrative Licenses by
China Securities Regulatory Commission, China Securities Regulatory Commission terminates review of the Company’s
administrative license.
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 111Annual Report 2015110
(4) Receivables of the top 5 debtors for closing balance
Company Relations with the
Company Amount Debt age
Rate of total
receivables %
Anhui Xincheng Financing and
Leasing Co., Ltd. Fully-owned subsidiary 129,088,928.00 Within 1 year 39.54
KEDA Industrial (Hong Kong)
Limited Fully-owned subsidiary 73,577,808.92 Within 1 year 22.54
KEDA (Anhui) Industrial Co., Ltd. Fully-owned subsidiary 16,500,975.02 Within 1 year 5.05
Client 6 Non-related party 4,920,049.97 1 to 2 years 1.51
Client 7 Non-related party 4,813,800.00 Within 1 year 1.47
Total 228,901,561.91 70.12
2. Other receivables
(1) Disclosure of other receivables: Unit: yuan, currency: RMB
Category
Closing balance Opening balance
Book balance Non-performing debt reserve
Book value
Book balance Non-performing debt reserve
Book valueAmount
Ratio
(%)Amount
Accrual
ratio(%)Amount
Ratio
(%)Amount
Accrual
ratio(%)
Receivables with significant single amount and non-performing debt reserve accrued
Current accounts of related parties
1,370,530,267.05 97.93 1,370,530,267.05 372,519,703.38 97.01 372,519,703.38
Export rebating 20,005,724.27 1.43 20,005,724.27
Other receivables with non-performing debt reserve accrued according to credit risk feature portfolio
9,015,089.09 0.64 1,359,091.45 15.08 7,655,997.64 11,474,582.03 2.99 880,329.10 7.67 10,594,252.93
Receivables with insignificant single amount and non-performing debt reserve accrued
Total 1,399,551,080.41 100.00 1,359,091.45 0.10 1,398,191,988.96 383,994,285.41 100.00 880,329.1 0.23 383,113,956.31
In the combination, other receivables with non-performing debt reserve accrued according to the debt age analysis
method:
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Debt age
Closing balance
Other
receivables
Non-performing
debt reserve Accrual ratio(%)
Within 1 year 3,613,709.09 180,685.45 5.00
1 to 2 years 4,504,280.00 900,856.00 20.00
2 to 3 years 570,000.00 114,000.00 20.00
More than 3 years 327,100.00 163,550.00 50.00
Total 9,015,089.09 1,359,091.45
In the combination, receivables with non-performing debt reserve accrued according to the debt age analysis method:
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Debt age
Closing balance
Accounts
receivable
Non-performing
debt reserve Accrual ratio(%)
Within 1 year 46,508,147.39 2,325,407.37 5.00
1 to 2 years 41,539,136.31 8,307,827.26 20.00
2 to 3 years 7,578,504.07 1,515,700.81 20.00
More than 3 years 7,360,964.76 3,680,482.38 50.00
Total 102,986,752.53 15,829,417.82
In the combination, receivables with non-performing debt reserve accrued according to the balance percentage
method:
□Applicable √Not applicable
In the combination, receivables with non-performing debt reserve accrued according to other methods:
Portfolio Book value Non-performing debt reserve
Goods payment of subsidiaries 219,167,711.94
Total 219,167,711.94
(2) Details of non-performing debt reserve accrued, recovered or carried back in this period:
Non-performing debt reserve accrued in this period is 13,401,232.51 yuan, and the non-performing debt amount
recovered or carried back in this period is 0.
Significant amount recovered or carried back for non-performing debt reserve in this period:
□Applicable √Not applicable
(3) Receivables written off in this period
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Amount written-off
Receivables written off 18,325,496.22
Details of writing-off of key receivables:
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Client Nature of
receivable
Amount
written off
Cause of
writing-off
Writing-off procedures
performed
Caused by related
transactions
Client A Goods payment 6,581,974.38 Unrecoverable Non-performing writing-
off approval processNo
Client B Goods payment 2,434,631.64 UnrecoverableNon-performing writing-
off approval processNo
Client C Goods payment 1,767,884.10 UnrecoverableNon-performing writing-
off approval processNo
Client D Goods payment 1,193,846.50 UnrecoverableNon-performing writing-
off approval processNo
Client E Goods payment 1,187,820.00 UnrecoverableNon-performing writing-
off approval processNo
Client F Goods payment 1,058,827.00 UnrecoverableNon-performing writing-
off approval process No
Total / 14,224,983.62 / / /
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 113Annual Report 2015112
(1) Investment on subsidiaries
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Invested party Opening balanceIncrement in
this period
Decrement in
this period Closing balance
Accrued
depreciation
reserve in
this period
Closing
balance of
depreciation
reserve
Foshan Shida Stone Machinery Co., Ltd. 34,651,224.26 34,651,224.26
KEDA Industrial (Hong Kong) Limited 66,946,000.00 66,946,000.00
KEDA (Anhui) Industrial Co., Ltd. 680,000,000.00 680,000,000.00
KEDA (Anhui) Clean Energy Co. Ltd. 232,909,800.00 232,909,800.00
Foshan KEDA Hydraulic Machinery Co.,
Ltd. 10,200,000.00 18,668,750.00 28,868,750.00
Shenyang KEDA Clean Energy Gas Co.,
Ltd330,000,000.00 330,000,000.00
Foshan Henglitai Machinery Co., Ltd. 682,954,365.00 682,954,365.00
Anhui Xincheng Investment Co., Ltd. 129,954,830.85 129,954,830.85
Changsha Aer Compressor Co., Ltd. 62,831,418.97 1,833,100.00 64,664,518.97
Henan KEDA Dongda International
Engineering Co., Ltd. 360,940,993.00 360,940,993.00
Jiangsu Kehang Environmental Protection
Science & Technology Co., Ltd. 180,000,000.00 180,000,000.00
Anhui Jiufu New Wall Materials Co., Ltd. 98,000,000.00 98,000,000.00
Emeishan KEDA Clean Energy Co., Ltd. 41,500,000.00 41,500,000.00
Linyi KEDA Clean Energy Co., Ltd. 26,600,000.00 26,600,000.00
Total 2,730,888,632.08 227,101,850.00 496,100,000.00 2,461,890,482.08
(2) Investment on joint venture and cooperative enterprise
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Invested partyOpening
balance
Change from increasing or decreasing in this period
Closing
balance
Closing
balance of
depreciation
reserve
Investment
increased
Investment
decreased
Investment
gains and
losses
confirmed
under equity
law
Adjustment
of other
comprehensive
earnings
Change
of other
equity
Cash
dividend
or profit
declared
and issued
Accruing
depreciation
reserve
Others
I. Joint venture
II, Cooperative
enterprises
Jiangyin Tianjiang
Pharmaceutical
Co., Ltd.
209,889,585.21 259,968,376.83 50,078,791.62
Guangdong
Taiwei Digital
Ceramics Printing
Co., Ltd.
8,258,025.03 7,694,126.51 -59,413.57 504,484.95
Subtotal 218,147,610.24 267,662,503.34 50,019,378.05 504,484.95
Total 218,147,610.24 267,662,503.34 50,019,378.05 504,484.95
In the combination, other receivable with non-performing debt reserve with other methods:
Portfolio Book value Non-performing debt reserve
Current accounts of related parties 1,370,530,267.05
Export rebating 20,005,724.27
Total 1,390,535,991.32
(2) Details of non-performing debt reserve accrued, recovered or carried back in the period:
Non-performing debt reserve accrued in this period is 478,762.35 yuan; non-performing debt reserve recovered or
carried back in this period is 0.
Key amount carried back or recovered for non-performing debt reserve in this period:
□Applicable √Not applicable
(3)Other receivables of the top 5 debtors for the closing balance:
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Company Nature of fund Closing balance Debt age
Ratio of closing
balance
to other
receivables (%)
Closing
balance of non-
performing debt
reserve
Shenyang KEDA Clean
Energy Gas Co., Ltd.
Current accounts
with subsidiaries 828,480,000.00
Within 1 year,
1 to 2 years 59.20
Anhui Xincheng Financing
and Leasing Co., Ltd.
Current accounts
with subsidiaries349,252,528.02 Within 1 year 24.96
KEDA (Anhui) Industrial
Co., Ltd.
Current accounts
with subsidiaries85,000,000.00 Within 1 year 6.07
Anhui Xincheng Investment
Co., Ltd.
Current accounts
with subsidiaries55,000,000.00 1 to 2 years 3.93
Jiangsu Kehang
Environmental Science &
Technology Co., Ltd.
Current accounts
with subsidiaries50,000,000.00 Within 1 year 3.57
Total / 1,367,732,528.02 / 97.73
3. Long-term equity investment
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item
Closing balance Opening balance
Book balance Depreciation
reserve Book value Book balance
Depreciation
reserve Book value
Investment on subsidiaries 2,461,890,482.08 2,461,890,482.08 2,730,888,632.08 2,730,888,632.08
Investment on joint venture
and cooperative enterprise 504,484.95 504,484.95 218,147,610.24 218,147,610.24
Total 2,462,394,967.03 2,462,394,967.03 2,949,036,242.32 2,949,036,242.32
Section IX Financial ReportSection IX Financial Report
Annual Report 2015 115Annual Report 2015114
(3) Investment earnings from disposal of long-term equity investment:
Item Amount in this period Amount last period
Jiangyin Tianjiang Pharmaceutical Co., Ltd. 664,177,590.17
Emeishan KEDA Clean Energy Co., Ltd. -41,500,000.00
Linyi KEDA Clean Energy Co., Ltd. -26,600,000.00
Anhui Jiufu New Wall Material Co., Ltd. -64,322,786.99
Shenyang KEDA Clean Energy Gas Co., Ltd. -284,220,242.31
Total 247,534,560.87
XVII. Additional data
1. Statement of non-recurring profits or losses in the current period Unit: yuan, currency: RMB
Item Amount
Gains or losses from disposal of non-current assets 581,119,655.21
Tax rebate or exemption because of overriding approval or being without official approval
documents
Government subsidy accounted into current profits and losses (except for the government
subsidy closely related to enterprise business, and in accordance with the generalized quota or
standard by the government)
78,313,724.07
Fund occupation fee not charged by financial enterprises accounted into current profits and
losses
Earnings from investment cost from acquiring subsidiaries, joint enterprise and cooperative
enterprise less than fair value of identifiable net assets of the invested party
Profits and losses of non-monetary asset swap
Profits and losses from assets invested or managed by others consigned
Asset depreciation reserves accrued due to factors beyond control, such as natural disaster
Profits and losses from debt reconstruction
Enterprise reconstruction fees, such as staff settlement expenses and reconstruction costs
Profits and losses from unfair transactions with price more than the fair value
Current net profits and losses of subsidiaries from beginning of the period of the date of
merging from merging of enterprises under the same control
Profits and losses from contingent events not related to the Company regular business
Except effective hedging business related to the Company’s regular business, profits and
losses from change of fair value of transaction financial assets and transaction financial
liabilities, and earnings of investment from disposal of transaction financial assets, transaction
financial liabilities and available-for-sale financial assets
Carrying back of receivable depreciation reserve with separate depreciation testing
Profits and losses from externally consigned loan
Profits and losses from change of fair value of subsequently measured investment property in
mode of fair value
According to tax, accounting and other legal requirements, the current profits and losses are
adjusted in lump sum to adjust influences on the current profits and losses
Income of trustee fee from cosigned business
Non-business income and expense beyond the above 3,469,777.07
Profits and losses in conformity with definitions of non-recurring profits and losses
Influential amount of income tax -132,290,054.16
Influential amount of minority shareholders’ equity 6,699,573.86
Total 537,312,676.05
4. Business income and business cost: Unit: yuan, currency: RMB
Item Amount in this period Amount last period
Income Cost Income Cost
Main business 1,770,882,293.78 1,457,952,249.74 2,003,919,051.51 1,613,342,571.66
Other business 2,829,642.59 2,944,203.73 1,285,965.14 676,074.16
Total 1,773,711,936.37 1,460,896,453.47 2,005,205,016.65 1,614,018,645.82
5. Investment earnings
√ Applicable □ Not applicableUnit: yuan, currency: RMB
Item Amount in this
period
Amount last
period
Earnings of long-term equity investment computed in accordance with the cost
method 20,000,000.00 175,000,000.00
Earnings of long-term equity investment computed in accordance with the equity
method50,019,378.05 64,718,670.43
Earnings of investment from disposal of long-term equity investment 247,534,560.87
Earnings of investment of financial assets during the holding period measured with
fair value with changes accounted into current gains and losses
Earnings of investment from disposal of financial assets measured with fair value
and changes accounted into current gains and losses
Earnings of investment of the held-to-maturity investment in the holding period
Earnings of investment of available-for-sale financial assets during the holding
period
Earnings of investment from disposal of available-for-sale financial assets
After losing the control, gains from remaining equity re-measured with fair value
Total 317,553,938.92 239,718,670.43
(1) Earnings of long-term equity investment computed according to the cost method:
Item Amount in this
period
Amount last
period
Foshan Henglitai Machinery Co., Ltd. 100,000,000.00
Foshan KEDA Stone Co., Ltd. 45,000,000.00
Henan KEDA Dongda International Engineering Co., Ltd. 20,000,000.00 30,000,000.00
Total 20,000,000.00 175,000,000.00
(2) Long-term equity investment earnings computed according to the equity law:
Item Amount in this
period
Amount last
period
Jiangyin Tianjiang Pharmaceutical Co., Ltd. 50,078,791.62 65,286,176.13
Guangdong Taiwei Digital Ceramics Printing Co., Ltd. -59,413.57 -567,505.70
Total 50,019,378.05 64,718,670.43
Section IX Financial Report
Annual Report 2015116
2. Earnings rate of net assets and earnings per share
Profit during the reporting period
Weighted
average net asset
earnings rate (%)
Earnings per share
Basic
earnings per
share
Diluted
earnings per
share
Net profit attributed to ordinary shareholders of the
Company 14.04 0.771 0.771
Net profits attributed to shareholders of ordinary shares of
the Company after non-recurring gains and losses deducted 0.10 0.006 0.006
Legal representative:
Date of approval and submitted by the Board of Directors: April 29, 2016
KEDA Clean Energy Co., Ltd.