2021 Midyear Report - static.cninfo.com.cn

Wafangdian Bearing Company Limited 2021 Midyear Report

1

Wafangdian Bearing Company Limited

2021 Midyear Report2021-24

August ,2020


2

Chapter I. Important Prompts, Table of Contents, and Definitions

The Board of Directors, board of supervisors, directors, supervisors, and top management of theCompany hereby guarantee that there are no false record, misleading statements and important omission ofthe material in this report, and assume the individual and associated responsibilities for the truth, accuracy andcompleteness of the contents.

Chairman Mr.Liu Jun , General Accountant Ms. Sun Najuan and accounting charger Ms. Zhang Yajingdeclare: guarantee the truth and completeness of the financial report in the annual report.

All directors attended the Board meeting and discussed the report.

This semi-annual report involves forward-looking statements such as future prospects and plans, whichdo not constitute a substantial commitment to the company's investors. Investors are advised to pay attentionto investment risks.

The Company has described in detail the relevant risks in this report, which does not constitute amaterial commitment of the Company to investors. Investors are requested to maintain sufficient riskawareness and understand the differences between plans, forecasts and commitments.In the third section ofthis report, "Management Discussion and Analysis" and "X. Risks faced by the Company andCountermeasures", the company describes in detail the possible risks and countermeasures in the company'soperation. Investors are invited to pay attention to the relevant contents.

The company plans to distribute no cash dividend, no bonus, no accumulation fund to increase capital.


3

Table of ContentsChapter I. Important Prompts, Table of Contents, and Definitions................................................................. 2

Chapter II. Company Profile......................................................................................................................6

Chapter III Business Summary................................................................................................................. 9

Chapter IVCorporate governance............................................................................................................15

ChapterV. Environmental and social responsibility....................................................................................16

ChapterVI. Significant Events................................................................................................................. 17

ChapterVII. Change of Shares and Particulars about Shareholders............................................................25

ChapterVIII. Relevant Information about preferred Shares........................................................................ 29

ChapterIX. Related Situation of bonds.....................................................................................................29

ChapterX. Financial Report.................................................................................................................... 30

Relevant Information about preferred Shares

Related Situation of bonds


4

File directory for reference

1. Semi-annual financial statements for 2021 with the signature and seal of the person in charge of thecompany, the person in charge of the accounting work and the person in charge of the accountinginstitution (the person in charge of the accounting);

2. Originals of all company documents and original announcements publicly disclosed in newspapersdesignated by CSRC during the reporting period.


5

Glossary

Terms Defined as Description

Company,the Company Defined as Wafangdian Bearing Company Limited

Wazhou Group Defined as Wafangdian Bearing Group Company

the report period, the currentperiod Defined as January 1,2020–June 30,2020

Liaozhou Co.,Ltd Defined as Wazhou Liaoyang Bearing Manufacture Co.,Ltd

Dalian motor Defined as Dalian motor Bearing Co.,Ltd

SRB company Defined as Wazhou spherial roller bearing company limited

The Board of Directors Defined as Wafangdian Bearing Company Limited The Board ofDirectors

The Supervisory Committee Defined as Wafangdian Bearing Company Limited TheSupervisory Committee

The Shareholders’ Meeting Defined as Wafangdian Bearing Company Limited TheShareholders’ Meeting

Shen Jiao Suo Defined as Shen Zhen Stock Exchange

SRC Defined as China Securities Regulatory Commission


6

Chapter II.Company ProfileI. Company InformationAbbreviated name of the stock Wazhou B Stock code: 200706

Listing location of the Company’

s stock:Shenzhen Stock Exchange

Chinese name of the Company 瓦房店轴承股份有限公司

Abbreviation of Chinese name 瓦轴股份公司

English name of the Company Wafangdian Bearing Company Limited

Abbreviation of English name WBC

Legal representative of theCompany

Liu Jun

II.Contacts

Secretary of the Board Representative of Stock Affairs

Name Sun Najuan Ke Xin

Correspondence addressNo. 1 Beigongji Street, Wafangdian City,Liaoning Province, China.

No. 1 Beigongji Street, Wafangdian City,Liaoning Province, China.

Consulting telephone 0411-62198008 0411-62198236

Fax 0411-62198333 0411-62198333

E-mail [email protected] zwz2308＠126.com

III.Other information1. Company contact informationThe company's registered address, office address and its postal code, the company's website address, E-mail box during the reporting

period whether changes

□ Applicable Inapplicable

The company's registered address, office address and its postal code, company's website address and E-mail address will not change

during the reporting period. Please refer to the 2020Annual Report for details.

2. Information disclosure and storage locationWhether the location of information disclosure and storage changes during the reporting period


The name of the information disclosure newspaper selected by the company, and the website designated by China Securities

Regulatory Commission to publish the semi-annual report. The reporting period of the preparation place of the semi-annual report of

the company remains unchanged, for details, please refer to the 2020 annual report.

IV. Main accounting data and financial indicatorsWhether the company needs to retroactively adjust or restate the previous year's accounting data

Yes No


7

In RMB Yuan

current periodprevious period

+/-comparing withthe previous period

Before adjustment After adjustment After adjustment

Operating income 1,081,064,853.66 999,645,101.91 896,732,234.86 20.56%

Net profit available for shareholders of listingcompany

4,192,143.24 3,647,082.19 3,647,082.19 14.95%

Net profit available for shareholders of listingcompany with abnormal incomes deducted

1,248,469.67 -4,526,512.88 -4,526,512.88 127.58%

Net cash flows from operation activities 31,402,343.49 72,521,427.05 72,521,427.05 -56.70%

Basic gains on per share 0.01 0.009 0.009 11.11%

Diluted gains on per share 0.01 0.009 0.009 11.11%

Net returns on assets 0.51% 0.30% 0.30% 0.21%

2021.06.302020.12.31

+/-comparing withthe previous period

Before adjustment After adjustment After adjustment

Total assets 3,348,155,218.45 3,133,942,842.94 3,133,942,842.94 6.84%

Owners’ equity (shareholders’ equity) 818,197,111.13 814,004,967.89 814,004,967.89 0.52%

V. Differences in accounting information under IAS and domestic accounting standard

1. At the same time, differences in net profit and net assets in financial reports disclosed in accordance with international accounting standards and

Chinese accounting standards.


During the reporting period, there is no difference between the net profit and net assets in the financial reports disclosed in accordance with

international accounting standards and Chinese accounting standards.

2. At the same time, the differences of net profit and net assets in financial reports disclosed in accordance with overseas accounting

standards and Chinese accounting standards.


During the reporting period, there is no difference between the net profit and net assets in the financial reports disclosed in accordance with

overseas accounting standards and Chinese accounting standards.

VI. Non-recurring gain/loss items and amountsApplicable Inapplicable

In RMB Yuan

Items Amount Remarks

Non-current asset disposal gains and losses (including the write-off portionof the asset impairment provision)

-820,370.34

Government subsidies included in the current profits and losses (closelyrelated to the business of the enterprise, except the government subsidiesenjoyed in accordance with the national unified standard quota or

3,063,661.27


8

quantitative)

Debt restructuring gains and losses 312,267.65

In addition to the normal business of the company effective hedging relatedbusiness, tradable financial assets, derivative financial assets, tradablefinancial liabilities, changes in the fair value of the derivative financialliabilities to generate profits and losses, as well as the disposal of tradablefinancial assets, derivative financial assets, tradable financial liabilities,derivative financial liabilities and other creditor's rights investment returns

183,361.31

Non-operating income and expenses other than those mentioned above 701,102.45

Less: income tax impact 496,348.77

A combined 2,943,673.57 --

For the company according to the company information disclosure of securities for public issuance explanatory announcement no. 1 - non-recurring

profit and loss "define non-recurring gains and losses as defined in the project, and put the company information disclosure of securities for public

issuance explanatory announcement no. 1 - non-recurring profit and loss of non-recurring profit and loss items defined as listed in the current profits

and losses of the project, it is necessary to explain the reason.


During the reporting period, the company does not define the listed non-recurring profit and loss items as recurring profit and loss items according

to explanatory Notice no. 1 -- Non-recurring Profit and loss of A Company that publicly issues Securities.

Chapter III Business SummaryI. Principal Businesses in the Reporting Period

The company's business scope is: bearing, bearing spare parts, mechanical equipment, auto parts and related products manufacturing and sales;

Bearing repair, maintenance and technical services; Lease of machinery and equipment and housing; Bearing and related mechanical equipment

and measurement instruments, instrument testing.

The company has a strong manufacturing capacity and quality assurance ability, extensive services in railway, automobile, metallurgy, mining, and

other industries and fields.

II.Analysis of core competitiveness

As the largest bearing technology and product r&d and manufacturing base in China, the company has accumulated many years of practical

experience in bearing and related fields, established a sound bearing technology innovation system, and maintained close cooperation with

domestic research institutes and universities. As the main draftsman of several standards in the bearing industry, he grasps the latest technical

trend of the development of the industry. It has established significant advantages in technology research and development, product manufacturing,

marketing and user services.

The company's customized design and manufacturing process can take into account the cost, delivery time and customer needs,

improving the ability to respond to the market and customer personalized needs.

The company has a complete product service system, with 24/7 dynamic service capability for product operation site. And to "ten

value-added services" a good image by the majority of customers praise. The company has a strong production and manufacturing

capacity and quality assurance capabilities, extensive services in railway, automobile, metallurgy, mining and other industries and

fields.


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At present, the company has established strategic cooperative relations with key customers in the field of domestic equipment

application. By intervening in customer value project to carry out in-depth marketing, the company has firmly established its brand

and influence in the domestic bearing market. In the international market, the company has obtained important target market

certification qualifications, international visibility initially established.

III Analysis on Principal BusinessesRefer to the relevant content of "I. Main Business of the Company during the reporting Period".

Major financial data year - on - year changes

In RMB Yuan

the

current reporting

period

Same period last

year

(+/-）Compared with the

same period last yearCause of change

Operating income 1,081,064,853.66 896,732,234.86 20.56%

Operating cost 831,304,584.25 674,721,170.74 23.21%

Cost of sales 78,899,762.56 75,613,172.33 4.35%

Management fees 45,845,225.31 39,172,811.53 17.03%

Finance charges 21,315,656.48 17,025,231.12 25.20%

R&D spending 98,277,786.26 88,374,018.61 11.21%

Net cash flow from

operating activities31,402,343.49 72,521,427.05 -56.70%

The increase in operating cash

received was less than the

increase in expenses

Net cash flow

generated from

investing activities

1,123,037.70 -875,861.59 -228.22%

Increased cash received from

the disposal of non-current

assets

Net cash flow

generated from

financing activities

1,642,489.74 40,350,135.07 -95.93%

Cash inflows from financing

activities declined while

expenditures increased

Net increase in cash

and cash equivalents33,151,074.54 112,950,609.87 -70.65%

All three of these declines

resulted in

The composition or source of profits of the company during the reporting period changes significantly


There is no significant change in the composition or source of profits during the reporting period.

Composition of operating income

In RMB Yuan

the current reporting period Same period last year (+/-）Compared withthe same period last

yearAmountProportion of

operating incomeAmount

Proportion ofoperating income

Total operatingRevenue

1,081,064,853.66 100% 896,732,234.86 100% 20.56%


10

Industry-classified

exit 84,996,299.57 7.90% 76,501,214.17 8.50% -0.70%

Traffic bearing 222,058,260.14 20.50% 152,104,515.02 17.00% 3.60%

Special bearings 174,002,173.00 16.10% 228,283,545.80 25.50% -9.40%

General bearing 472,073,371.26 43.70% 275,107,503.10 30.70% 13.00%

Industrialoperation

26,193,575.14 2.40% 34,444,509.72 3.80% -1.40%

Other businessincome

101,741,174.55 9.40% 130,290,947.05 14.50% -5.10%

Products-classified

bearing 953,130,103.96 88.20% 731,996,778.09 81.60% 6.50%

Industrialoperation

26,193,575.15 2.40% 34,444,509.72 3.80% -1.40%

Other businessincome

101,741,174.55 9.40% 130,290,947.05 14.50% -5.10%

Region-classified

domestic 996,068,554.09 92.10% 820,231,020.69 91.50% 0.60%

foreign 84,996,299.57 7.90% 76,501,214.17 8.50% -0.60%

Industry, product or region accounting for more than 10% of the company's operating revenue or operating profit

Applicable Inapplicable

Reasons for the change of more than 30% in related data


IV.Non-main business analysisApplicable Inapplicable

In RMB Yuan

AmountAs a percentage of

total profitCause statement Sustainability or not

Return on investment 870,263.42 20.76% Debt restructuring NO

Fair value change

profit or loss183,361.31 4.37%

Shares of traded financial

assets roseNO

Non-operating

income817,656.00 19.50% Fine income, etc. NO

Non-operating

expenses936,923.89 22.35% Scrap non-current assets NO

V. Situation of assets and liabilities1. Significant changes in asset composition

In RMB Yuan


11

End of 2021.06.30 End of 2020.06.30Percentage of

change(%)

Statement on majorchangeAmount

Percent in

total assetAmount

Percent in

total asset

Monetary fund 213,848,619.85 6.39% 194,152,280.08 6.20% 0.19%

Accounts receivable 944,368,834.23 28.21% 975,628,091.12 31.13% -2.92%

inventory 761,125,814.98 22.73% 615,656,946.30 19.64% 3.09%

Investment real estate 115,459,279.72 3.45% 117,516,482.39 3.75% -0.30%

Fixed assets 402,752,098.78 12.03% 474,109,923.22 15.13% -3.10%

Projects under

construction24,348,551.06 0.73% 24,254,985.16 0.77% -0.04%

Right of use assets 1,009,841.91 0.03% 0.03%

Short-term borrowing 698,000,000.00 20.85% 670,000,000.00 21.38% -0.53%

Contract liability 47,607,834.61 1.42% 39,456,304.55 1.26% 0.16%

Lease liability 1,281,492.96 0.04% 0.04%

2. Main overseas assets


3. Assets and liabilities measured at fair value


In RMB Yuan

itemOpening

balance

Changes in

fair value

for the

current

period

Changes

in the

accumulate

d fair value

of an equity

Impairment

of the

current

period

Current

purchase

amount

Current

sale amount

Ending

balanceitem

Financial

assets

1. Trading

financial

assets

(excluding

derivative

financial

assets)

228,046.00 183,361.31 -155,625.99 411,407.31

The above

total228,046.00 183,361.31 -155,625.99 411,407.31

Financial

liabilities0.00 0.00


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Other changes

Whether the measurement attributes of the company's main assets have changed significantly during the reporting period

□ Yes No

4. Limitation of asset rights at the end of the report period

None

VI. Analysis of investment status1. The general situationApplicable Inapplicable

2. Significant equity investment acquired during the reporting periodApplicable Inapplicable

3. Significant ongoing non-equity investments during the reporting periodApplicable Inapplicable

4. Investment in financial assets

(1) Securities investment

Varieties

of

securities

Stock

code

The

securities

referred

to as"

Initial

investm

ent cost

Account

ing

measure

ment

model

Opening

book

value

Change

in fair

value

for the

current

period

Changes

in the

cumulat

ive fair

value of

equity

Current

purchas

e

amount

Current

sale

amount

Reporti

ng

period

profit

and loss

Ending

book

value

Account

ing

subject

Sources

of

funding

Domestic

and

foreign

stocks

601005

Chongqi

ng iron

and steel

567,033

.30

Fair

value

measure

ment

228,046

.00

183,361

.31

-155,62

5.990.00 0.00

183,361

.31

411,407.

31

Transact

ional

financia

l assets

debt-for

-equity

Total567,033

.30--

228,046

.00

183,361

.31

-155,62

5.990.00 0.00

183,361

.31

411,407.

31-- --

Date of disclosure announced

by the Securities investment

Examination and Approval

Board

Date of announcement of

shareholders' Meeting on

Securities Investment Approval

(if any)


(2) Derivative investmentApplicable Inapplicable

There were no derivatives investments during the reporting period.


13

VII Sale of major assets and shares1. Sale of major assets


No significant assets were sold during the reporting period.

2. Sale of major equityApplicable Inapplicable

VII.Analysis of major holding companiesApplicable Inapplicable

During the reporting period, the company has no important information about the holding and shareholding company that should be

disclosed.

IX. Structured subjects controlled by the companyApplicable Inapplicable

X. Risks faced by the Company and countermeasuresThe current national economic development is facing unprecedented challenges. The company is faced with increasing uncertainties

in market demand and market competitors. The market influence and product pricing of competitors are full of uncertainties, which

brings great risks to the company's market and production and operation.The company's labor costs continue to rise;Prices of raw and

auxiliary materials remain high;Corporate profit margins remain tough.The company must fully assess the difficulties, risks and

uncertainties, and drive the high-quality growth of the business by developing middle and high-end products and achieving high-end

breakthroughs.The implementation of differentiated management, not only focus on products, technology, market, but also focus on

the core value of customers, improve the core competitiveness of enterprises;Adhere to quality first, enhance brand

influence;Accelerate the pace of reform, stimulate new vitality of enterprises;Improve the cost performance of bearing products,

make use of the different market positioning of international big brand companies, fully seize the larger market growth space, see that

the tile shaft market has space, enterprises have resources, development policies, employees have the advantages of dream, to achieve

efficient and sustainable development.

The company will focus on the "grab the order to protect the market" to open up the market battle, go all out to develop the market,

to achieve the sales target.Adhere to the "cash is king", strengthen credit control, to organize the return of funds, improve the capital

turnover rate, reduce the occupation of funds.Focusing on "expanding capacity to achieve stable growth of production, improving

quality, reducing cost and increasing efficiency", we will start the tough battle of production capacity, improve contract performance

and order execution, accelerate upstream and downstream supply chain coordination and process optimization, and thereby digest all

kinds of adverse factors within the company.


14

Chapter IV Corporate governanceI.The relevant annual general meeting and extraordinary general meeting held in the report periodi.Shareholders' General Meeting in the report period

Meeting session TypeInvestorparticipation ratio

Meeting Date Disclosure Date Disclosure index

2020 Annualshareholders’ Meeting

Annual shareholders’Meeting

80.31% 2021.05.19 2021.05.20 http//www,cninfo,com,cn

ii.The shareholders of the preferred shareholders who have resumed the voting are required to convene an extraordinary general meeting


II. Changes of directors, supervisors and senior managers of the companyApplicable Inapplicable

Name Position Type Date Cause

Zhao Yang Director The outgoing 2021.01.08 Job changes

Zhao Yang GM dismissal 2021.01.08 Job changes

Wang Jiyuan GM employment 2021.01.13

Wang Jiyuan Director elected 2021.05.19

Gao Ping Supervisor The outgoing 2021.01.07 Job changes

Zhang Yihui Supervisor elected 2021.01.08

III.Profit distribution and conversion of capital reserve into capital stock during the reporting periodApplicable Inapplicable

The company plans not to distribute cash dividend, not to send bonus shares, not to increase the accumulation fund capital.

IV. Implementation of the company's equity incentive plan, employee stock ownership plan or other employeeincentive measuresApplicable Inapplicable

The company has no equity incentive plan, employee stock ownership plan or other employee incentive measures and their

implementation during the reporting period.


15

Chapter V Environmental and social responsibilityI. Major environmental issuesWhether listed companies and their subsidiaries belong to the environmental protection department announced the key pollutant

discharge units

□ Yes No

Administrative penalties imposed for environmental problems during the reporting period

Name of company

or subsidiaryPenalty reason non-compliance The penalty

The impact on the

production and

operation of listed

companies

Corrective

measures of the

company

NONE NONE NONE NONE NONE NONE

Refer to other environmental information disclosed by key polluters

The company and its subsidiaries do not belong to the key pollutant discharge units announced by the environmental protection

authorities.

Reasons for not disclosing other environmental information

The company and its subsidiaries do not belong to the key pollutant discharge units announced by the environmental protection

authorities.

II. Social responsibility

In 2021, the company will earnestly fulfill its due social responsibilities. While pursuing its economic benefits, the company will

actively undertake the responsibilities for the comprehensive development of the country and society, the natural environment and

resources, as well as stakeholders such as shareholders, employees, customers, consumers, suppliers and communities, and realize its

social value.It has achieved win-win cooperation among the country, society and stakeholders, strengthened environmental protection,

improved resource efficiency, influenced and driven the development of local economy through project construction, and effectively

promoted the coordinated development of the company with society, nature and other stakeholders.

In strict accordance with relevant national and local laws, regulations and documents, the company has handled old-age insurance,

unemployment insurance, medical insurance, work-related injury insurance, maternity insurance, housing accumulation fund and

large medical mutual insurance for its employees.Provide timely assistance to employees in need.An employment system, including a

salary system and incentive mechanism, has been established and improved to ensure that employees enjoy their labor rights and

fulfill their labor obligations in accordance with the law.Establish and improve the labor safety and health system, strictly implements

national labor safety and health regulations and standards, undertake to the worker labor safety and hygiene education, occupational

protection and health checks for the worker to provide healthy and safe working environment and living environment, maximum

limit to prevent accidents during work and reduce occupational hazards.

The company adheres to the principles of voluntary, fair, equivalent compensation, honesty and credit in its business activities, and

strictly controls the quality objectives to ensure that qualified products are provided.The technical department of the company is

actively engaged in the development of new products and materials. The company guarantees that all products or services provided

by the company meet the relevant national quality standards or have been certified by the relevant national quality inspection

departments, and actively applies for various domestic and foreign third-party certification.The company pays attention to customer

after-sales service and properly handles complaints and suggestions from customers and consumers.Strictly conduct third-party

qualification examination and on-site inspection of suppliers, select qualified suppliers, carefully understand the needs of suppliers,

and actively build a good cooperation atmosphere.


16

Chapter VI Significant Events

I. Commitments made by the company's actual controller, shareholders, related parties,purchasers and the company that have been completed during the reporting period and thathave not been completed by the end of the reporting period


During the reporting period of the company, there are no commitments made by the actual controller, shareholders, related parties,

purchasers and the company that have been completed in the reporting period or have not been completed by the end of the reporting

period.

II.Non-operational occupation of funds by controlling shareholders and other related partiesof the listed companyApplicable Inapplicable

During the reporting period, there is no non-operational appropriation of funds by controlling shareholders and other related parties

to the listed company.

III. Foreign guarantee in violation of regulationsApplicable Inapplicable

No violation of the company's external guarantee during the reporting period.

IV.Employment and dismissal of accounting firmsWhether the semi-annual financial report has been audited

□ Yes No

The company's semi-annual report is unaudited.

V. Explanations by the board of directors and the Board of Supervisors on the "non-standardaudit Report" of the accounting firm during the reporting periodApplicable Inapplicable

VI. Explanations by the Board of directors on the "non-standard audit Report" of theprevious yearApplicable Inapplicable

VII. Bankruptcy reorganization related mattersApplicable Inapplicable

No bankruptcy reorganization related matters occurred during the company's reporting period.

VIII. Litigation MattersMajor litigation and arbitration matters


During the reporting period, the company has no major litigation or arbitration matters.

Other Litigation matters



17

Litigation

(arbitration)

basic

information

Amount

involved (ten

thousand

Yuan)

Whether to

form an

estimated

liability

Litigation

(arbitration

) progress

Litigation

(arbitration)

hearing result

and influence

Litigation

(arbitration)

judgment

execution

Date of

disclosure

Disclosur

e index

Summary of

other litigation

matters that do

not meet the

standards for

material

litigation

disclosure

31.1 NOIn the

progressDo not apply Do not apply

August 24,

2021

IX. Punishment and rectificationApplicable Inapplicable

There is no punishment or rectification in the reporting period.

X.The integrity status of the company and its controlling shareholders and actual controllersApplicable Inapplicable

XII. Major related Party Transactions1. Related party transactions related to daily operationsApplicable Inapplicable


18

Related party correlation

Types of

Related

Transacti

ons

Content

of

Related

Transact

ions

Principles

of pricing

related

party

transactions

Related

transact

ion

price

Related

Transaction

Amount (ten

thousand

yuan)

As a

percentage

of the value

of similar

transactions

Approved

Transaction

Amount (ten

thousand

yuan)

Whether

it exceeds

the

approved

limit

Settlement

method of

related party

transactions

The market price

available for

similar

transactions

Date of

disclosur

e

Disclosure

index

Wafangdian

Bearing

Precision

Forging Co.,

Ltd

Other

enterprises

controlled by

the same

controlling

shareholder and

ultimate

controlling

party

To buy

or sell

somethin

g

Buy

spare

parts

The

marketizati

on

Fair

market

price

11,095.05 14.00% 45,000 NO

Money or

checks or

money orders

Fair market price

Wafangdian

bearing

Group

High-end

Auto Bearing

Co., Ltd.

Other

enterprises

controlled by

the same

controlling

shareholder and

ultimate

controlling

party

To buy

or sell

somethin

g

The

purchas

e of

goods

The

marketizati

on

Fair

market

price

6,371.33 8.00% 17,000 NO

Money or

checks or

money orders

Fair market price

Wafangdian

Bearing

Group

Precision

Retainer Co.,

Other

enterprises

controlled by

the same

controlling

To buy

or sell

somethin

g

Buy

spare

parts

The

marketizati

on

Fair

market

price

6,610.61 8.00% 15,000 NO

Money or

checks or

money orders

Fair market price


19

Ltd. shareholder and

ultimate

controlling

party

Wafangdian

Bearing

Precision

Forging Co.,

Ltd

Other

enterprises

controlled by

the same

controlling

shareholder and

ultimate

controlling

party

To buy

or sell

somethin

g

Sales of

goods

The

marketizati

on

Fair

market

price

4,326.51 4.00% 13,000 NO

Money or

checks or

money orders

Fair market price

A combined -- -- 28,403.5 -- 90,000 -- -- -- -- --

Details of large sales returns No

Actual performance during the reporting period (if any)

where the total amount of daily related party transactions

to be incurred in the current period is estimated by

category

No

Reasons for the large difference between the transaction

price and the market reference price (if applicable)No


20

2. Related party transactions arising from the acquisition or sale of assets or shares


During the reporting period of the company, no related transactions of asset or equity acquisition or sale occurred.

3. Related party transactions of joint foreign investment


During the reporting period, the company has no related party transaction of joint foreign investment.

4. Associated creditor's rights and debt transactions


Whether there is non-operating associated creditor's rights and debts

□ Yes No

The company has no non-operating associated creditor's rights or debts during the reporting period.

5. Dealings with related financial companies and financial companies that the company holds


There is no deposit, loan, credit granting or other financial business between the company and the related finance company, or

between the finance company holding the company and its related parties.

6. Other significant related party transactions


The company has no other significant related transactions during the reporting period.

XII. Major contracts and their performance

1.trusteeship, contracting, leasing matters

(1) TrusteeshipApplicable Inapplicable

There is no trusteeship situation during the reporting period of the company.

(2) Contracting situationApplicable Inapplicable

There is no contract situation in the company's reporting period.

(3) Leasing situationApplicable Inapplicable

Lease information

The company's lease is all related lease, details see the notes


21

The items which bring profit and loss to the company reach more than 10% of the total profit of the company in the reporting period


Name of the

lessorName of the lessor

Leased

assets

Amount of

leased

assets (ten

thousand

yuan)

Lease

Commence

ment Date

Lease

terminatio

n date

Rental

income (ten

thousand

yuan)

Basis for

determining

rental income

The impact of

lease income

on the

company

Whether

related Party

transaction

correlation

Wafangdian

bearing co., LTD.

Organization

chart

Dalian Wazhou

Jinzhou Machinery

Co., Ltd.

house 2021.01.01 2021.12.31 40.16 Marketization 10% yes

Other enterprises controlled by the

same controlling shareholder and

ultimate controlling party

Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian bearing

Group High-end

Auto Bearing Co.,

Ltd.





Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Group Precision

Retainer Co., Ltd.





Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Group Co., Ltd.house 2021.01.01 2021.12.31 54.8 Marketization 13% yes




Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Precision Forging

Co., Ltd





Wafangdian Wafangdian bearing equipm 2021.0101 2021.12.31 394.25 cost pricing 94% yes Other enterprises controlled by the


22

bearing co., LTD.

Organization

chart

Group High-end

Auto Bearing Co.,

Ltd.

ent same controlling shareholder and


Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Group Precision

Retainer Co., Ltd.

equipm

ent2021.0101 2021.1231 41.92 cost pricing 10% yes




Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian bearing

group precision

roller co., LTD

equipm

ent2021.01.01 2021.12.31 21.99 cost pricing 5% yes




Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Group Co., Ltd.

equipm

ent2021.01.01 2021.12.31 366.25 cost pricing 87% yes




Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Group Precision

Retainer Co., Ltd.

land 2021.01.01 2021.12.31 13.16 cost pricing 3% yes




Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Group Co., Ltd.land 2021.01.01 2021.12.31 15.11 cost pricing 4% yes The parent company

Wafangdian

bearing co., LTD.

Organization

chart

Wafangdian Bearing

Precision Forging

Co., Ltd

land 2021.01.01 2021.12.31 27.54 cost pricing 7% yes





23

2. Major guarantee


There is no material guarantee during the reporting period.

3. Entrust financial management


Company report period does not exist entrust finance.

4. Major daily business contracts


5. Other major contracts


There are no other major contracts during the reporting period.

XIII.Description of other important mattersApplicable Inapplicable

There are no other major matters that need to be explained during the reporting period.

XIV. Major events of the company's subsidiariesApplicable Inapplicable


24

Chapter VII Change of Shares and Particulars about Shareholders

I. Changes in shares1. Changes in shares

Unit:share

Before this change This change increases or decreases（＋,－） After this change

number proportion

Issuing

new

shares

Send

shares

Reserve

fund

conversi

on

other subtotal numberproporti

on

I. Unlisted and

circulating shares244,000,000 60.61%

244,000

,00060.61%

1. Shares of the

sponsors244,000,000 60.61%

244,000

,00060.61%

Among them: the state

holds shares244,000,000 60.61%

244,000

,00060.61%

The domestic legal

entity holds shares

Overseas legal person

holding shares

other

2. Offering corporate

shares

3, internal labor shares

4. Preferred stock or

other

II. Listed and

circulating shares158,600,000 39.39%

158,600

,00039.39%

1. RMB ordinary

shares

2. Foreign capital

stocks listed in China158,600,000 39.39%

158,600

,00039.39%

3. Foreign capital

stocks listed abroad

4, other

III. Total number of

shares402,600,000 100.00%

402,600

,000

100.00

%


25

Reasons for changes in shares


Approval of changes in shares


Changes in ownership of shares


Implementation progress of share repurchase


The implementation progress of share repurchase by means of collective bidding


The impact of changes in shares on financial indicators such as basic earnings per share and diluted earnings per share and net

assets per share attributable to common shareholders of the Company in the latest year and the latest period


Other disclosures deemed necessary by the Company or required by securities regulatory authorities


2. Changes in restricted sharesApplicable Inapplicable

II. Securities issuance and listing


III. The number of shareholders and stock holding of the company

Unit:share

Total number of commonshareholders at the end ofreporting period

5,816

Total number of preferredshareholders with votingrights restored at thereporting End (if any) (seeNote 8)

0

Shares held by common shareholders holding more than 5% or the top 10 common shareholders

Shareholder'sname

Nature of theshareholders stake

Number ofcommonshares heldat the end ofthe reporting

period

Changes inthe

reporting

period

Number ofunlisted andtradableordinaryshares held

Numberof listedand

tradableordinarysharesheld

The condition of apledge, mark, or freeze

Shares instate

Thenumber of

WafangdianBearing GroupCo., Ltd.

State-ownedlegal person 60.61% 244,000,000 244,000,000

AKTIEBOLAGETSKF

Foreign legalperson 19.70% 79,300,000 79,300,0

00China MerchantsSecurities HongKong Limited

State-ownedlegal person 1.89% 7,595,091 7,595,09

1

Huang Junyue Domestic 1.74% 7,025,268 7,025,26


26

natural person 8

Hu Xiaofeng Domesticnatural person 0.47% 1,879,277 1,879,27

7BOCISECURITIESLIMITED

Foreign legalperson 0.33% 1,310,000 1,310,00

0

GUOTAI JUNANSECURITIES(HONGKONG)LIMITED

Foreign legalperson 0.22% 896,800 896,800

Jin Yunhua Domesticnatural person 0.19% 750,000 750,000

Meng Qingliang Domesticnatural person 0.18% 734,548 734,548

MAN,KWAIWING文贵荣

Foreignnatural person 0.18% 713,101 713,101

A description of such shareholderassociation or concerted action

Among the top 10 shareholders of the company, there is no association relationship orconcerted action between the first major shareholder and other shareholders or the top 10shareholders of tradable shares, while the association relationship and concerted actionbetween other shareholders, the top 10 shareholders of tradable shares or the top 10shareholders of tradable shares and other shareholders are unknown.

Explanation of the aboveshareholders' entrustment/entrustedvoting rights and abandonment ofvoting rights

none

The shareholding of the top 10 outstanding common shareholders

Shareholder's name Number of listed and circulating common shares held at the endof the report

Stake speciesStakespecies

Thenumber of

AKTIEBOLAGET SKF 79,300,000 B 79,300,000China Merchants Securities HongKong Limited 7,595,091 B 7,595,091

Huang Junyue 7,025,268 B 7,025,268Hu Xiaofeng 1,879,277 B 1,879,277BOCI SECURITIES LIMITED 1,310,000 B 1,310,000GUOTAI JUNANSECURITIES(HONGKONG)LIMITED

896,800 B 896,800

Jin Yunhua 750,000 B 750,000Meng Qingliang 734,548 B 734,548MAN,KWAI WING文贵荣 713,101 B 713,101Zhou Junlin 575,301 B 575,301

A description of the association or

coordinated action between the top

10 Common shareholders on

Unlimited Conditions and between

the top 10 Common shareholders on

Unlimited Conditions and the top 10

common shareholders on Unlimited

Conditions

Among the top 10 shareholders of the company, there is no association relationship or

concerted action between the first major shareholder and other shareholders or the top 10

shareholders of tradable shares, while the association relationship and concerted action

between other shareholders, the top 10 shareholders of tradable shares or the top 10

shareholders of tradable shares and other shareholders are unknown.

Whether the company's top 10 common Stockholders and the top 10 common Stockholders with unlimited conditions of sale will

make an agreed repurchase transaction during the reporting period

□ Yes No


27

The company's top 10 common Stockholders and the top 10 common Stockholders with unlimited conditions of sale did not make

an agreed repurchase transaction during the reporting period.

IV.Changes in shareholding of directors, supervisors and senior management

personnel


The shareholding status of directors, supervisors and senior managers of the company has not changed during the reporting period.

Please refer to the 2020 annual Report for details.

V.Change of controlling shareholder or actual controller

Change of controlling shareholder during reporting period


The controlling shareholder of the company has not changed during the reporting period.

Actual controller changes during the reporting period


The actual controller of the company has not changed during the reporting period.

Chapter VIII Relevant Information about preferred SharesApplicable Inapplicable

No preferred stock existed at the reporting period.

Chapter IX Related Situation of bondsApplicable Inapplicable


28

Chapter X Financial Reports

I. Audit report

Whether the semiannual report is audited

□ Yes No

The company's semi-annual financial report is unaudited.

II. Financial statements

The unit of the statement in the financial notes is yuan

1. Consolidated balance sheet

Establishment unit: Wafangdian Bearing Co., LTD

In RMB Yuan

ITEM 2021.6.30 2020.12.31

Current assets:

Monetary fund 213,848,619.85 194,152,280.08

Settlement provision

Lending money,

Trading financial assets 411,407.31 228,046.00

Derivative financial assets

Notes receivable 619,807,598.26 416,044,578.48

Accounts receivable 944,368,834.23 975,628,091.12

Receivables financing 129,580,519.36 130,600,545.59

prepayments 22,055,659.11 53,772,465.49

Premiums receivable

Reinsurance accounts receivable

Reinsurance contract reserves receivable

Other accounts receivable 11,290,749.69 14,204,144.25

Where: interest receivable

Dividends receivable

Purchase and resale of financial assets

inventory 761,125,814.98 615,656,946.30

Contract assets

Hold assets for sale

Non-current assets maturing within one year


29

Other current assets 10,712,609.56 24,610,448.93

Total current assets 2,713,201,812.35 2,424,897,546.24

Non-current assets:

Issue loans and advance payments

Creditor's rights investment

Other debt investment

Long-term receivables

Long-term equity investment

Investment in other equity instruments 11,926,856.64 11,926,856.64

Other non-current financial assets

Investment real estate 115,459,279.72 117,516,482.39

Fixed assets 402,752,098.78 474,109,923.22

Projects under construction 24,348,551.06 24,254,985.16

Productive biological assets

Oil and gas assets

Right of use assets 1,009,841.91

Intangible assets 79,119,926.72 80,725,861.18

The development of spending

goodwill

Long-term deferred expenses 336,851.27 511,188.11

Deferred tax assets

Other non-current assets

Total non-current assets 634,953,406.10 709,045,296.70

Total assets 3,348,155,218.45 3,133,942,842.94

Current liabilities:

Short-term borrowing 698,000,000.00 670,000,000.00

Borrowing from the central bank

Funds borrowed from

Transactional financial liabilities

Derivative financial liabilities

Notes payable 226,793,257.05 274,654,535.65

Accounts payable 1,279,404,724.99 1,044,801,896.85

Advance payment

Contract liability 47,607,834.61 39,456,304.55


30

Sale of repurchase financial assets

Take deposits and inter-bank deposits

Acting to buy and sell securities

Acting as an underwriter of securities

payments

Employee compensation payable 21,852,557.25 52,677,141.09

Payable taxes 4,336,864.26 3,688,168.68

Other payable 146,468,203.79 129,476,061.47

Where: interest payable 1,680,000.00 1,041,600.00

Dividends payable

Fees and commissions due

Reinsurance accounts payable

Holding liabilities for sale

Non-current liabilities due within one year

Other current liabilities 6,168,824.67 5,129,319.58

Total current liabilities 2,430,632,266.62 2,219,883,427.87

Non-current liabilities:

Reserve for insurance contract

Long-term borrowing

Bonds payable

Where: Preferred stock

Sustainable debt

Lease liability 1,281,492.96

Long-term payables 344,974.84 344,974.84

Long-term employee compensation payable

Estimated debts 39,427,812.54 39,032,270.91

Deferred revenue 57,537,112.01 59,942,753.08

Deferred tax liabilities 734,448.35 734,448.35

Other non-current liabilities

Total non-current liabilities 99,325,840.70 100,054,447.18

Total liabilities 2,529,958,107.32 2,319,937,875.05

Owner's equity:

equity 402,600,000.00 402,600,000.00

Other equity instruments


31


Sustainable debt

Capital reserves 485,691,050.47 485,691,050.47

Minus: Treasury stocks

Other comprehensive income

The special reserve

Surplus reserves 136,770,391.01 136,770,391.01

General risk provision

Undistributed profit -206,864,330.35 -211,056,473.59

Total owner's equity attributable to the parent

company818,197,111.13 814,004,967.89

Minority equity

Total owner's equity 818,197,111.13 814,004,967.89

Total liabilities and owners' equity 3,348,155,218.45 3,133,942,842.94

Chairman: Liu Jun General Accountant : Sun Najuan Accounting charger: Zhang Yangjing

2. Balance sheet of parent company

In RMB Yuan

item 2021.6.30 2020.12.31

Current assets:

Monetary fund 186,426,311.94 173,606,464.84




Accounts receivable 1,056,049,412.72 1,051,197,353.63


prepayments 19,589,717.59 52,961,548.88




inventory 467,971,154.61 472,723,348.67

Contract assets


Non-current assets maturing within one year



32


Non-current assets:




Long-term equity investment 211,583,897.67 211,583,897.67

Investment in other equity instruments 11,926,856.64 11,926,856.64



Fixed assets 243,189,782.54 309,847,783.81



Oil and gas assets

Right of use assets 1,009,841.91



goodwill


Deferred tax assets



Total assets 3,142,648,627.16 2,957,003,038.79





Notes payable 226,793,257.05 274,654,535.65

Accounts payable 1,047,520,093.85 845,753,616.99

Advance payment



Payable taxes 2,881,606.34 3,395,991.46

Other payable 133,346,564.94 109,599,140.08



33

Dividends payable


Non-current liabilities due within one year




Long-term borrowing

Bonds payable


Sustainable debt

Lease liability 1,281,492.96


Long-term employee compensation payable

Estimated debts 39,427,812.54 39,032,270.91


Deferred tax liabilities




Owner's equity:

equity 402,600,000.00 402,600,000.00



Sustainable debt




The special reserve






34

3. Consolidated income statement

In RMB Yuan

Item Half year 2021 Half year 2020

I. Total revenue 1,081,064,853.66 896,732,234.86

Wherein: operating income 1,081,064,853.66 896,732,234.86

Interest income

The premium has been made

Commission and commission income

II. Total operating costs 1,083,628,314.10 902,201,538.62

Where: operating costs 831,304,584.25 674,721,170.74

The interest payments

Commission and commission expenses

Surrender gold

Net compensation expenditures

Draw the net reserve for insurance liability

Policy bonus expense

Reinsurance expenses

Taxes and surcharges 7,985,299.24 7,295,134.29

Cost of sales 78,899,762.56 75,613,172.33

Management fees 45,845,225.31 39,172,811.53

Research and development costs 98,277,786.26 88,374,018.61

Finance charges 21,315,656.48 17,025,231.12

Including: interest expense

Interest income

Plus: Other benefits 3,063,661.27 6,192,961.72

Investment income (Loss marked with "-") 870,263.42 664,574.71

Among them: income from investment in joint ventures

and joint ventures

Financial assets measured by amortized cost cease to

recognize income

Exchange gain (Loss marked with "-")

Net exposure hedging gain (loss marked with "-")

Gains from changes in fair value (loss marked with "-") 183,361.31 -55,470.65

Credit impairment loss (marked with "-") 30,000.00 7,311.38


35

Asset impairment loss (marked with "-")

Income from asset disposal (marked with "-" for loss) 2,727,585.57 276,663.74

III. Operating profit (Loss marked with "-") 4,311,411.13 1,616,737.14

Add: non-operating income 817,656.00 2,135,533.80

Less: non-operating expenses 936,923.89 105,188.75

IV. Total profit (Total loss marked with "-") 4,192,143.24 3,647,082.19

Less: income tax expense

V. Net profit (Net loss marked with "-") 4,192,143.24 3,647,082.19

(I) Classification by business continuity

1. Net profit from continuing operations (net loss marked

with "-")4,192,143.24 3,647,082.19

2. Net profit from discontinued operations (Net loss

marked with "-")

(2) classification by ownership

1. Net profit attributable to the owner of the parent

company4,192,143.24 3,647,082.19

2. Minority shareholder profits and losses

VI.Other comprehensive income net after tax

Net after tax of other comprehensive income attributable

to the owner of the parent company

(1) other comprehensive income that cannot be

reclassified into profit or loss

1. Remeasure the change amount of the set benefit plan

2. Other comprehensive income that cannot be transferred

to profit or loss under the equity method

3. Changes in fair value of other equity instruments

4. Changes in fair value of the enterprise's own credit risk

5. Other

(2) other comprehensive income that is reclassified into

profit and loss

1. Other comprehensive income that can be converted to

profit or loss under the equity method

2. Changes in fair value of other creditor's rights

investments

3. The amount of financial assets reclassified into other

comprehensive income


36

4. Credit impairment provisions for other debt investments

5. Cash flow hedging reserves

6. Foreign currency financial statements translation

difference

7. Other

Net after tax of other comprehensive income attributable

to minority shareholders

VII. Total comprehensive income 4,192,143.24 3,647,082.19

Total comprehensive income attributable to the owners of

the parent company4,192,143.24 3,647,082.19

Total comprehensive income attributable to minority

shareholders

VII. Earnings per Share:

(1) Basic earnings per share 0.010 0.009

(2)Diluted earnings per share 0.010 0.009

Chairman: Liu Jun General Accountant : Sun Najuan Accounting charger: Zhang Yangjing

4. Profit statement of the parent company

In RMB Yuan

ITEM Half year 2021 Half year 2020

I. Operating income 1,208,722,319.78 906,073,566.08

Minus: Operating costs 1,006,724,605.05 689,325,459.39

Taxes and surcharges 7,111,149.37 5,964,290.11

Cost of sales 52,975,165.53 74,331,649.69

Management fees 29,681,629.16 29,227,235.02

Research and development costs 95,537,317.61 87,464,042.25

Finance charges 21,341,481.25 17,198,370.63

Including: interest expense 14,013,998.99 15,282,652.60

Interest income 201,513.60 223,957.21

Plus: Other benefits 2,957,430.25 5,920,067.26

Investment income (Loss marked with "-") 395,755.29 564,574.71

Among them: income from investment in joint ventures and

joint ventures

Income from termination of recognition of financial assets

measured at amortized cost (loss is marked with "-")

Net exposure hedging gain (loss marked with "-")


37

Gains from changes in fair value (loss marked with "-") 183,361.31 -55,470.65

Credit impairment loss (marked with "-") 30,000.00 -12,688.62

Asset impairment loss (marked with "-")

Income from asset disposal (marked with "-" for loss) 2,101,609.41 -51,078.19

II. Operating profit (Loss marked with "-") 1,019,128.07 8,927,923.50

Add: non-operating income 218,265.92 1,189,886.16

Less: non-operating expenses 909,209.72 82,988.75

III. Total profit (Total loss marked with "-") 328,184.27 10,034,820.91

Less: income tax expense

IV. Net Profit (Net loss marked with "-") 328,184.27 10,034,820.91

(1) Net profit from continuing operations (net loss marked

with "-")328,184.27 10,034,820.91

(2) Net profit from discontinued operations (net loss marked

with "-")

V.Net after-tax income of other comprehensive income

(1) other comprehensive income that cannot be reclassified

into profit or loss

1. Remeasure the change amount of the set benefit plan

2. Other comprehensive income that cannot be transferred to


3. Changes in fair value of other equity instruments

4. Changes in fair value of the enterprise's own credit risk

5. Other

(2) other comprehensive income that is reclassified into profit

and loss

1. Other comprehensive income that can be converted to


2. Changes in fair value of other creditor's rights investments

3. The amount of financial assets reclassified into other

comprehensive income

4. Credit impairment provisions for other debt investments

5. Cash flow hedging reserves

6. Foreign currency financial statements translation

difference

7. Other

VI Total comprehensive income 328,184.27 10,034,820.91


38

VII. Earnings per Share:

(1) Basic earnings per share 0.001 0.025

Diluted earnings per share 0.001 0.025

5. Consolidated cash flow statement

In RMB Yuan


I. Cash flow generated from operating activities:

Cash received from sales of goods and services 651,887,024.41 582,774,122.01

Net increase in customer deposits and interbank deposits

Net increase in borrowing from the central bank

Net increase in borrowing from other financial institutions

Cash received from the premium of the original insurance contract

Net cash received from reinsurance operations

Net increase in insured savings and investment funds

Cash in which interest, commission and commission are charged

Net increase in borrowed funds

Net increase in funds from repurchase operations

Net cash received on behalf of securities

Tax refund received 9,745,355.53

Receive other cash in connection with operating activities 57,242,048.48 10,270,237.51

Subtotal cash inflow from operating activities 718,874,428.42 593,044,359.52

Cash paid for goods and services 399,687,605.02 280,077,473.08

Net increase in customer loans and advances

Net increase in central bank and interbank deposits

Cash payment of the original insurance contract claims

Net increase in the amount of money taken out

Cash to pay interest, commissions and commissions

Cash to pay policy dividends

Cash paid to and for employees 180,018,756.84 143,554,226.02

Taxes and fees paid 31,277,371.86 25,632,251.85

Payment of other cash related to operating activities 76,488,351.21 71,258,981.52

Subtotal cash outflow from operating activities 687,472,084.93 520,522,932.47

Net cash flow from operating activities 31,402,343.49 72,521,427.05

Ii. Cash flow generated by investment activities:


39

Cash received from investment

Cash received in return for investment income 18,821.12

Net cash recovered from disposal of fixed assets, intangible assets

and other long-term assets1,692,187.72 329,175.16

Net cash received from the disposal of subsidiaries and other

operating units

Cash received in connection with other investment activities

Subtotal cash inflow from investing activities 1,711,008.84 329,175.16

Cash paid for the purchase and construction of fixed assets, intangible

assets and other long-term assets587,971.14 1,205,036.75

Cash paid for investments

Net increase in pledged loans

Net cash paid by subsidiaries and other operating units

Other cash payments in connection with investment activities

Subtotal cash outflow from investing activities 587,971.14 1,205,036.75

Net cash flow generated from investing activities 1,123,037.70 -875,861.59

III. Cash flow generated by financing activities:


Wherein: the cash received by the subsidiary in absorbing the

investment of minority shareholders

Cash received for borrowing 486,000,000.00 509,000,000.00

Receive other cash in connection with financing activities 38,566,252.78 41,567,823.29

Subtotal cash inflow from financing activities 524,566,252.78 550,567,823.29

Cash paid to pay off debts 458,093,645.83 395,000,000.00

Cash used to distribute dividends, profits, or interest payments 14,830,117.21 48,107,688.22

Among them: dividends and profits paid by subsidiaries to minority

shareholders

Payment of other cash in connection with financing activities 50,000,000.00 67,110,000.00

Subtotal cash outflow from financing activities 522,923,763.04 510,217,688.22

Net cash flow generated from financing activities 1,642,489.74 40,350,135.07

4. Impact of exchange rate changes on cash and cash equivalents -1,016,796.39 954,909.34

V.Net increase in cash and cash equivalents 33,151,074.54 112,950,609.87

Plus: opening cash and cash equivalents balance 127,620,944.91 137,324,488.53

VI.Ending balance of cash and cash equivalents 160,772,019.45 250,275,098.40


40

6. Cash flow statement of parent company

In RMB Yuan


I. Cash flow generated from operating activities:

Cash received from sales of goods and services 686,999,795.18 868,958,768.09

Tax refund received

Receive other cash in connection with operating activities 57,135,498.00 9,779,044.10

Subtotal cash inflow from operating activities 744,135,293.18 878,737,812.19

Cash paid for goods and services 465,910,588.87 593,706,724.17

Cash paid to and for employees 154,155,107.30 124,085,830.07

Taxes and fees paid 30,454,451.51 20,543,127.41

Payment of other cash related to operating activities 68,913,107.16 67,388,001.75

Subtotal cash outflow from operating activities 719,433,254.84 805,723,683.40

Net cash flow from operating activities 24,702,038.34 73,014,128.79

Ii. Cash flow generated by investment activities:


Cash received in return for investment income 18,821.12

Net cash recovered from disposal of fixed assets,

intangible assets and other long-term assets829,187.72 4,175.16

Net cash received from the disposal of subsidiaries and

other operating units

Cash received in connection with other investment

activities

Subtotal cash inflow from investing activities 848,008.84 4,175.16

Cash paid for the purchase and construction of fixed

assets, intangible assets and other long-term assets250,672.14 524,567.59

Cash paid for investments

Net cash paid by subsidiaries and other operating units

Other cash payments in connection with investment

activities

Subtotal cash outflow from investing activities 250,672.14 524,567.59

Net cash flow generated from investing activities 597,336.70 -520,392.43

III. Cash flow generated by financing activities:


Cash received for borrowing 486,000,000.00 509,000,000.00


41

Receive other cash in connection with financing activities 38,566,252.78 41,567,823.29

Subtotal cash inflow from financing activities 524,566,252.78 550,567,823.29

Cash paid to pay off debts 458,093,645.83 395,000,000.00

Cash used to distribute dividends, profits, or interest

payments14,830,117.21 48,107,688.22

Payment of other cash in connection with financing

activities50,000,000.00 67,110,000.00

Subtotal cash outflow from financing activities 522,923,763.04 510,217,688.22

Net cash flow generated from financing activities 1,642,489.74 40,350,135.07

IV. Impact of exchange rate changes on cash and cash

equivalents-1,016,796.39 954,909.34

V.Net increase in cash and cash equivalents 25,925,068.39 113,798,780.77

Plus: opening cash and cash equivalents balance 143,182,984.73 101,216,633.47

VI.Ending balance of cash and cash equivalents 169,108,053.12 215,015,414.24


42

7. Statement of Changes in consolidated owners' equity

In RMB Yuan

ITEM

Half year 2021Owner's equity in the parent company

Minorityshareholders’ equity

Owner’sequityCapital

stock


Capitalpublic

reserves

less：treasurestock

othercomprehen

siveincome

appropriative

reserve

Surpluspublic

reserves

Generalprovision for

riskUndistributed

profits Others totalPreferredshares

Perpetual

CapitalSecuritie

s

Other

I. Ending balanceof the previousyear

402,600,000.00

485,691,050.47

136,770,391.01

-211,056,473.59

814,004,967.89

814,004,967.89

Plus: Accountingpolicy changeEarly errorcorrectionMerger ofbusinesses underthe same controlotherII, the beginningbalance of this year

402,600,000.00

485,691,050.47

136,770,391.01

-211,056,473.59

814,004,967.89

814,004,967.89

III. Amount ofincrease ordecrease in thecurrent period(marked with "-"for decrease)

4,192,143.24 4,192,143.24

4,192,143.24

(1) Totalcomprehensiveincome

4,192,143.24 4,192,143.24

4,192,143.24

(2) Ownerinvestment andcapital reduction1.Common stockinvested by the


43

owner2.Other equityinstrument holdersinvested capital(3) Profitdistribution1.Withdraw surplusreserves2.Extract generalrisk provision3.Distribution toowners (orshareholders)4．Other(4) Internalcarry-over ofowners' equity1.Capital reservesto increase capital(or equity)2.Surplus reservesinto increasedcapital (or equity)3.Surplus reservescover losses4. Set the changeof benefit plan tocarry forwardretained earnings5. Othercomprehensiveincome carriedforward retainedearnings6. Other(5) Specialreserves1. Currentwithdrawal


44

2. Use this period(6) OthersIV. Ending balanceof the currentperiod

402,600,000.00

485,691,050.47

136,770,391.01

-206,864,330.35

818,197,111.13

818,197,111.13

The amount of the previous period

In RMB Yuan

ITEM

Half year 2021Owner's equity in the parent company

Minorityshareholders’ equity

Owner’sequityCapital

stock


Capitalpublic

reserves


othercomprehen

siveincome

appropriative

reserve

Surpluspublic

reserves

Generalprovision for

riskUndistributed

profits Others totalPreferredshares

Perpetual

CapitalSecuritie

s

Other

I. Ending balanceof the previousyear

402,600,000.00

485,691,050.47

136,770,391.01 201,379,956.97 1,226,44

1,398.451,226,441,

398.45

Plus: Accountingpolicy changeEarly errorcorrectionMerger ofbusinesses underthe same controlotherII, the beginningbalance of this year

402,600,000.00

485,691,050.47

136,770,391.01 201,379,956.97 1,226,44

1,398.451,226,441,

398.45III. Amount ofincrease ordecrease in thecurrent period(marked with "-"for decrease)

17.93 -28,560,917.81 -28,560,899.88

-28,560,899.88

(1) Totalcomprehensiveincome

3,647,082.19 3,647,082.19

3,647,082.19

(2) Ownerinvestment and


45

capital reduction1.Common stockinvested by theowner2.Other equityinstrument holdersinvested capital(3) Profitdistribution -32,208,000.00 -32,208,

000.00-32,208,00

0.001.Withdraw surplusreserves2.Extract generalrisk provision3.Distribution toowners (orshareholders)

-32,208,000.00 -32,208,000.00

-32,208,000.00

4．Other(4) Internalcarry-over ofowners' equity1.Capital reservesto increase capital(or equity)2.Surplus reservesinto increasedcapital (or equity)3.Surplus reservescover losses4. Set the changeof benefit plan tocarry forwardretained earnings5. Othercomprehensiveincome carriedforward retainedearnings6. Other


46

(5) Specialreserves 17.93 17.93 17.93

1. Currentwithdrawal 17.93 17.93 17.93

2. Use this period(6) OthersIV. Ending balanceof the currentperiod

402,600,000.00

485,691,050.47 17.93 136,770,39

1.01 172,819,039.16 1,197,880,498.57

1,197,880,498.57

8. Statement of changes in owner's equity of the parent company

This amount

In RMB Yuan

In RMB Yuan

Item

Amount in previous period

Capital stock


Capital publicreserves

less：treasure

stock

Other

comprehensive

income

appropriative

reserveSurplus public reserves

General provision forrisk

Undistributedprofits

Owner’s equityPreferre

d stock

PerpetualCapital

SecuritiesOther

I. Balance at the

end of last year402,600,000.00 485,678,443.26 136,770,391.01 -128,677,200.69 896,371,633.58

Plus: Change in

accounting

policy

Previous error

correction

other

II.The

beginning402,600,000.00 485,678,443.26 136,770,391.01 -128,677,200.69 896,371,633.58


47

balance of the

current year

III. Amount of

increase or

decrease in the

current period

(marked with

"-" for

decrease)

328,184.27 328,184.27

(1) Total

comprehensive

income

328,184.27 328,184.27

(2) The owner

invests and

reduces the

capital

1. Common

stock invested

by the owner

2. Other equity

instrument

holders invested

capital

3. The amount

of a share

payment

included in the

owner's equity


48

4. other

(3) Profit

distribution

1. Extract the

surplus reserve

2. Distribution

to owners (or

shareholders)

3. other

(4) Internal

carry-over of

owners' equity

1. Conversion

of capital

reserves into

increased

capital (or

equity)

2. Surplus

reserve into

increased

capital (or

equity)

3. Surplus

reserves cover

losses

4. Set benefit


49

plan changes

carried forward

to retained

earnings

5. Other

consolidated

earnings carried

forward to

retained

earnings

6. other

Special reserves

1. This extract

2. In current use

(6) Others

IV. Ending

balance402,600,000.00 485,678,443.26 136,770,391.01 -128,349,016.42 896,699,817.85

The amount of the previous period

In RMB Yuan

Item

Amount in previous period

Capital stock


Capital publicreserves


Other

comprehensive

income

appropriative

reserveSurplus public reserves

General provision forrisk

Undistributedprofits

Owner’s equityPreferre

d stock

PerpetualCapital

SecuritiesOther

I. Balance at the

end of last year402,600,000.00 485,678,443.26 136,770,391.01 272,858,542.42 1,297,907,376.69


50

Plus: Change in

accounting

policy

Previous error

correction

other

II.The

beginning

balance of the

current year

402,600,000.00 485,678,443.26 136,770,391.01 272,858,542.42 1,297,907,376.69

III. Amount of

increase or

decrease in the

current period

(marked with

"-" for

decrease)

-22,173,179.09 -22,173,179.09

(1) Total

comprehensive

income

10,034,820.91 10,034,820.91

(2) The owner

invests and

reduces the

capital

1. Common

stock invested

by the owner

2. Other equity


51

instrument

holders invested

capital

3. The amount

of a share

payment

included in the

owner's equity

4. other

(3) Profit

distribution-32,208,000.00 -32,208,000.00

1. Extract the

surplus reserve

2. Distribution

to owners (or

shareholders)

-32,208,000.00 -32,208,000.00

3. other

(4) Internal

carry-over of

owners' equity

1. Conversion

of capital

reserves into

increased

capital (or

equity)

2. Surplus

reserve into


52

increased

capital (or

equity)

3. Surplus

reserves cover

losses

4. Set benefit

plan changes

carried forward

to retained

earnings

5. Other

consolidated

earnings carried

forward to

retained

earnings

6. other

Special reserves

1. This extract

2. In current use

(6) Others

IV. Ending

balance402,600,000.00 485,678,443.26 136,770,391.01 250,685,363.33 1,275,734,197.60


53

III.General Information

Wafangdian Bearing Company Limited (the “Company”, the “Group” is referred to “Company”together with its subsidiaries ) is a joint stock limited company established in the People’s Republic ofChina (the “PRC” ) on 16 July, 1997. In the opinion of the directors, its parent and ultimate holdingcompany is Wafangdian Bearing Group Company Limited (“Wazhou Group”).

The Company’s B shares have been listed on the Shenzhen Stock Exchange since 19February, 1997.

The parent company is Wazhou Group. General shareholders meeting is the company’s authority and havethe resolution power over company’ s business policy, financing, investment and profit appropriationetc.significant events in accordance with relevant law. Board of directors is responsible for general meetingand has the power over the company’s decision making. Management is in charge of implementation ofresolution made by general meeting and board meeting and is responsible for operation management. Thecompany has the following functional departments including: procurement department, portfolio investmentdepartment, operating department, HR, marketing department, manufacturing and construction department,quality control department, financial department and logistic department. Wholly owned subsidiaries includeWazhou Liaoyang Bearing Manufacturing Co., Ltd(“Liaoyang Bearing”), Dalian Wazhou Precision ElectricMotor Car Bearing ( “ DalianElectrical Motor ” ),and Wazhou Precision of Spherical RollerBearings(Wafangdian)Co., Ltd(“Spherical Bearings”).

The addresses of the registered office and principal place of business of the Company are No.1, Phrase 1,Gongji Street, Wafangdian North, Liaoning Province, and the PRC.Legal representative is Liu Jun.

Business scope: Permitted items: inspection and testing services, import and export of goods, import andexport of technology (the business activities can be carried out only after the approval of the relevantdepartments according to law, and the specific business items shall be subject to the approval results)Bearingmanufacturing, bearings, gears and transmission components manufacturing, high speed precision heavy-dutybearing sales, sales bearings, gears and transmission parts, bearing sales, general equipment manufacturing(excluding special equipment manufacturing), high-speed rail equipment, parts manufacturing, machineryand equipment sales, rail transportation equipment, key system and parts sales, sales of lubricating oil,high-speed rail equipment and accessories sales,Wind generators and spare parts sales, machinery parts, spareparts sales, railway locomotive vehicle accessories manufacturing, railway locomotive vehicle accessoriessales, auto parts and accessories manufacturing, auto parts wholesale and retail auto parts, metal productsrepair, sales metal materials, metal products sales, metal surface treatment and heat treatment processing,quenching process,Machinery parts and spare parts processing, land use right leasing, housing leasing,non-residential real estate leasing, machinery equipment leasing, computer and communication equipmentleasing, transportation equipment leasing service, office equipment leasing service, storage equipment leasingservice, special equipment leasing, labor service (excluding labor dispatch),Technical services, technologydevelopment, technology consultation, technology exchange, technology transfer, technology promotion


54

(except for projects that are subject to approval according to law, business activities shall be independentlycarried out according to law with business licenses)

Financial Statement Consolidation Scope

The Group’s financial statements consolidation includes Liaoyang Bearing, Dalian Wazhou Precision MotorCar Bearing Company and Spherical Bearing three companies. There is no change for consolidation scopeby comparing to last year.

Please refer to “VII. Change of consolidation scope” and “VIII. Equity within other entity” in the Noteto the financial statements.

IV.Financial Statements Preparation Basis

(1)Basis of preparation

The Company’s financial statements are prepared on the basis of going concern assumption, according tothe actual occurred transactions and events and in accordance with ‘Accounting Standards for BusinessEnterprises’ and relevant regulations, and also based on the note IV “Significant Accounting Policies,Accounting Estimates”.

(2)Going concern

The group has evaluated the going-concern capability for the 12 months from the end of the reportingperiod, and has found no significant doubts about the going-concern capability. Therefore, the financialstatements are prepared on the assumption of going concern.

V. Significant Accounting Policies and Accounting Estimates

Specific accounting policy and estimates reminder: the group established the accounting policy and estimate,such as operation cycle, bad debt recognition and measurement, dispatched inventory measurement andclassification of fixed assets and FA’s depreciation, intangible asset’s amortization, revenue recognitionand measurement based on the actual characters of business operation.

1. Declaration for compliance with accounting standards for business enterprises

The financial statements are prepared by the Group according to the requirements of Accounting Standardfor Business Enterprise, and reflect the relative information for the financial position, operatingperformance, cash flow of the Group truly and fully.

2. Accounting period

The Group adopts the Gregorian calendar year as accounting period, i.e. from Jan 1 to Dec 31.

3.Operating cycle

Normal operating cycle refers to the duration starting from purchasing the assets for manufactuing up tocash or cash equivelant realisation. The group sets twelve months for one operating cycle and as theliquidity criterion for assets and liability.

4. Funcitonal currency


55

The Group adopts RMB as functional currency.

5. Accounting for business combination under same control and not under same control

As an acquirer, the assets and liabilities that The Group obtained in a business combination under thesame control should be measured on the basis of their carrying amount in the consolidated financialstatements on the combining date. As for the balance between the carrying amount of the net assetsobtained by the combining party and the carrying amount of the consideration paid by it, the capitalsurplus shall be adjusted. If the capital surplus is not sufficient to be offset, the retained earnings shall beadjusted.

For a business combination not under same control, the asset, liability and contingent liability obtainedfrom the acquirer shall be measured at the fair value on the acquisition date. The combination cost shallbe the fair value, on the acquisition date, of the assets paid, the liabilities incurred or assumed and equitysecurities issued by the acquirer in exchange for the control of the acquire, and sum of all directexpenses(if the combination is achieved in stages, the combination cost shall be the sum of individualtransaction). The difference when combination cost exceeds proportionate share of the fair value ofidentifiable net assets of acquiree should be recognized as goodwill. If the combination cost is less thanproportionate share of the fair value of identifiable net assets of acquiree, firstly, fair value of identifiableasset, liability or contingent liability shall be reviewed, and so the fair value of non-monetary assets orequity instruments issued in the combination consideration , after review, still the combination cost isless than proportionate share of the fair value of identifiable net assets of acquire, the difference should berecognized as non-operating income.

6. Method of preparation of consolidated financial statements

All subsidiaries controlled by the Group and structured entities are within the consolidation scope.

If subsidiaries adopt different accounting policy or have different accounting period from the parentcompany, appropriated adjustments shall be made in accordance with the Group policy in preparation ofthe consolidated financial statements.

All significant intragroup transactions, outstanding balances and unrealized profit shall be eliminated infull when preparing the consolidated financial statements. Portion of the subsidiary’ s equity notbelonging to the parent, profit, loss for the current period, portion of other comprehensive income andtotal comprehensive belonging to minority interest, shall be presented separately in the consolidatedfinancial statements under “minority interest of equity”,”minority interest of profit and loss”, “othercomprehensive income attributed to minority interest” and “total comprehensive income attributed tominority interest” title.

If a subsidiary is acquired under common control, its operation results and cash flow shall be consolidatedsince the beginning of the consolidation period. When preparing the comparative consolidated financialstatements, adjustments shall be made to relevant items of comparative figures as regarded that reportingentity established through consolidation has been always there since the point when the ultimatecontrolling party starts to have the control.

If a business consolidation under common control is finally achieved in stages, consolidation accountingmethod shall be disclosed additionally for the period in which the control is obtained. For example, if abusiness consolidation under common control is finally achieved in stages, when preparing theconsolidated financial statements, adjustments shall be made for the current consolidation status as ifconsolidation has always been there since the point when the ultimate controlling party starts to control.


56

In preparation of comparative figures, asset and liability of the acquiree shall be consolidated into theGroup’s comparative financial statements, but to the extent no earlier than the point when the Group andacquiree are both under ultimate control and relevant items under equity in comparative financialstatements shall be adjusted for net asset increased in combination. To avoid the duplicated computationof net asset of acquiree, for long-term equity investment held by the Group before the consolidation,relevant profit and loss, other comprehensive income and movement in other net asset, recognized for theperiod between the combination date and later date when original shareholding is obtained and when theGroup and the acquiree are under common control of same ultimate controlling party, shall berespectively used for writing down the opening balance of retained earnings of comparative financialstatements and profit and loss for the current period.

If a subsidiary is acquired not under common control, its operation results and cash flow shall beconsolidated since the beginning of the consolidation period. In preparation of the consolidated financialstatements, adjustments shall be made to subsidiary’s financial statements based on the fair value of itsall identifiable assets, liability or contingent liability on the acquisition date.

If a business consolidation under non-common control is finally achieved in stages, consolidationaccounting method shall be disclosed additionally for the period in which the control is obtained. Forexample, if a business consolidation not under common control is finally achieved in stages, whenpreparing the consolidated financial statements, the acquirer shall remeasure its previously held equityinterest in the acquiree at its acquisition-date fair value and recognize the resulting gain or loss asinvestment income for the current period. Other comprehensive income, under equity method accountingrising from the interest held in acquiree in relation to the period before the acquisition, and changes in thevalue of its other equity other than net profit or loss, other comprehensive income and profit appropriationshall be transferred to investment gain or loss for the period in which the acquisition incurs,excluding the other comprehensive income from the movement on the remeasurement of ne asset orliability of defined benefit plan.

When the Group partially disposes of the long –term equity investment in subsidiary without losing thecontrol over it, in the consolidated financial statements, the difference, between disposals price andrespective disposed value of share of net assets in the subsidiary since the acquisition date or combinationdate, shall be adjusted for capital surplus or share premium, no enough capital surplus, then adjusted forretained earnings.

When the Group partially disposes of the long –term equity investment in subsidiary and lose the controlover it, in preparation of consolidated financial statements, remaining share of interest in the subsidiaryshall be remeasured on the date of losing control. Sum of the share disposal consideration and fair valueof remaining portion of shareholding minus the share of the net assets in the subsidiary held based on theprevious shareholding percentage since the acquisition date or combination date, the balance of aboveis recognized as investment gain/loss for the period and goodwill shall be written off accordingly. Othercomprehensive income relevant to share investment in subsidiary shall be transferred to investment gain/loss for the period on the date of losing control.

When the Group partially disposes of the long –term equity investment in subsidiary and lose the controlover it by stages, if all disposing transactions are bundled, each individual transaction shall be seen as atransaction of disposal of a subsidiary by losing control. The difference between the disposal price andthe share of the net assets in the subsidiary held before the date of losing control, shall be recognize asother comprehensive income until the date of losing control where it is transferred into investment gain/loss for the current period.


57

7. Joint arrangement classification and joint operation accounting

8. Cash and cash equivalent

The cash listed on the cash flow statements of the Group refers to cash on hand and bank deposit. Thecash equivalents refer to short-term (normally with original maturities of three months or less) and liquidinvestments which are readily convertible to known amounts of cash and subject to an insignificant risk ofchanges in value.

9. Translation of foreign currency

Foreign currency transaction

Foreign currency transactions are translated at the spot exchange rate issued by People’s Bank of China(“PBOC”) when the transaction incurs. Monetary assets and liabilities in foreign currencies are translatedinto RMB at the exchange rate prevailing at the balance sheet day. Exchange differences arising from thesettlement of monetary items are charged as in profit or loss for the period. Exchange differences ofspecific borrowings related to the acquisition or construction of a fixed asset should be capitalized asoccurred, before the relevant fixed asset being acquired or constructed is ready for its intended uses.

Translation of foreign currency financial statements

The asset and liability items in the foreign currency balance sheet should be translated at a spot exchangerate at the balance sheet date. Among the owner’s equity items except “undistributed profit”, othersshould be translated at the spot exchange rate when they are incurred. The income and expense should betranslated at spot exchange rate when the transaction incurs. Translation difference of foreign currencyfinancial statements should be presented separately under the other comprehensive income title. Foreigncurrency cash flows are translated at the spot exchange rate on the day when the cash flows incur. Theamounts resulted from change of exchange rate are presented separately in the cash flow statement.

10.Financial instruments

A financial asset or financial liability is recognised when the Group becomes a party to a financial instrument contract.

Financial assets

Classification, recognition basis and measurement method of financial assets

The Group classifies financial assets as financial assets measured at amortized cost, financial assets measured at fair value and

their changes included in other comprehensive income, and financial assets measured at fair value and their changes included in

current profit and loss according to the business model of financial assets management and the contractual cash flow characteristics

of financial assets.

The Group classifies the financial assets that meet the following conditions as financial assets measured by amortized cost: ①

The business model for the management of the financial assets is to receive contract cash flow as the target.② The contractual terms

of the financial asset stipulate that the cash flow generated on a specified date is only the payment of the principal and the interest

based on the outstanding principal amount.Such financial assets are initially measured in accordance with their fair value, and

relevant transaction costs are included in the initial recognition amount;Follow up measurement at amortized cost.Except for the

hedged item, the difference between the initial amount and the amount due shall be amortized according to the effective interest rate

method, and the amortization, impairment, exchange gain or loss and the gain or loss arising from the termination of recognition

shall be recorded into the current profit or loss.

The group classiifies the financial assets that meet the following conditions as financial assets measured at fair value and whose

changes are included in other comprehensive income: ①The business model of managing the financial assets is aimed at both


58

receiving the contract cash flow and selling the financial assets.② The contractual terms of the financial asset stipulate that the cash

flow generated on a specified date is only the payment of the principal and the interest based on the outstanding principal

amount.Such financial assets are initially measured in accordance with their fair value, and relevant transaction costs are included in

the initial recognition amount.Except for those designated as hedged items, other gains or losses, other than credit impairment

losses or gains, exchange gains and losses and interest on the financial assets calculated according to the effective interest rate

method, arising from such financial assets shall be included in other comprehensive income;When the recognition of a financial

asset is terminated, the accumulated gains or losses previously recorded in other comprehensive income shall be transferred out of

other comprehensive income and recorded into the current profit and loss.

The Group recognizes interest income in accordance with the effective interest rate method.The interest income shall be

calculated and determined by multiplying the book balance of the financial asset by the actual interest rate, except in the following

cases: (1) For the purchased or generated financial asset with credit impairment, the interest income shall be calculated and

determined according to the amortized cost of the financial asset and the actual interest rate adjusted by credit since the initial

recognition.(2) For the financial assets purchased or generated without credit impairment, but become credit impairment in the

subsequent period, the interest income of the financial assets shall be calculated and determined according to the amortized cost and

the actual interest rate of the financial assets.

The Group designates non-traded equity instrument investments as financial assets that are measured at fair value and whose

changes are recorded in other comprehensive income.Once made, such designation may not be revoked.Non-tradable equity

instrument investment designated by the Group which is measured at fair value and its changes are included in other comprehensive

income shall be initially measured in accordance with fair value and relevant transaction costs shall be included in the initial

recognition amount;In addition to the dividends (excluding the investment cost recovery part) included in the current profit and loss,

other related gains and losses (including exchange gains and losses) are included in other comprehensive income, and can not be

transferred into the current profit and loss.When the recognition is terminated, the accumulated gains or losses previously included

in other comprehensive income are transferred from other comprehensive income and included in retained earnings.

Financial assets other than those classified above as financial assets measured at amortized cost and those classified as

financial assets measured at fair value and whose changes are included in other comprehensive income.The group will classify it

into two financial assets measured at fair value and its changes into current profit and loss.Such financial assets in accordance with

the fair value of the initial measurement, the relevant transaction costs directly into the current profit and loss.Gains or losses on

such financial assets shall be booked into current profits and losses.

If the contingent consideration recognized by the Group in the business combination not under the same control constitutes a

financial asset, the financial asset shall be classified as the financial asset measured at fair value and the change of the financial

asset shall be recorded into the current profit and loss.

Confirmation basis and measurement method of financial asset transfer

The Group will terminate the recognition of the financial assets that meet one of the following conditions: (1) Termination

of the contractual right to receive the cash flow of the financial assets;(2) When financial assets are transferred, the group has

transferred almost all risks and rewards on the ownership of financial assets;(3) When the financial asset is transferred, the Group

neither transfers nor retains almost all the risks and rewards of the ownership of the financial asset, and does not retain control over

the financial asset.

Transfer the entire financial asset meet the recognition criteria of termination, the book value of the transferred financial asset,

and received by transfer of value and the fair value originally recorded in other comprehensive income amount corresponds to the

portion whose recognition has been stopped in the accumulative amount of changes (provisions relating to transfer of financial

assets of the terms of the contract, the cash flow at a specific date,Only the difference between the sum of the principal and the

interest payments based on the outstanding principal amount is accounted for in the current profit or loss.If the partial transfer of

financial assets meets the conditions for the termination of recognition, the overall carrying value of the transferred financial assets

shall be apportion between the terminated recognition part and the unterminated recognition part according to their respective


59

relative fair value.And will be received by transfer of value and share to terminate identified previously included in the other part of

the changes in fair value of the accumulative amount of comprehensive income the amount of which corresponds to the portion

whose recognition has been stopped (provisions relating to transfer of financial assets of the terms of the contract, the cash flow at a

specific date, is only on the principal and on the basis of the outstanding principal amount of the interest payments), the sum of

The difference between it and the apportioned overall book value of the aforementioned financial assets shall be recorded into the

profit and loss of the current period.

Financial liabilities

Classification, recognition basis and measurement method of financial liabilities

At the time of initial recognition, the financial liabilities of the Group are classified as financial liabilities and other financial

liabilities which are measured at fair value and whose changes are included in the profit and loss of the current period.

Financial liabilities measured at fair value and whose changes are included in the profit and loss of the current period,

including trading financial liabilities and the financial liabilities initially recognized as measured at fair value and whose changes

are included in the profit and loss of the current period, (the relevant classification is disclosed according to the financial asset

classification basis).The subsequent measurement is carried out according to the fair value, and the gains or losses formed by the

change of fair value and the dividends and interest expenses related to the financial liabilities are booked into the current profit and

loss.

For other financial liabilities, the effective interest rate method is adopted and the subsequent measurement is carried out

according to the amortized cost.In addition to the following, the group will be financial liabilities classified as financial liabilities

measured at the amortized cost: (1) measured at fair value and the changes are recorded into the profits and losses of the current

financial liabilities, including transactional financial liabilities (including the derivatives for financial liabilities) and designated as

at fair value and whose fluctuations are recorded into the profits and losses of the current financial liabilities.(2) Financial liabilities

formed by the transfer of financial assets that do not meet the conditions for termination of recognition or continue to be involved in

the transferred financial assets.(3) financial security contracts that do not fall under the circumstances ① or ② above, and loan

commitments that do not fall under the circumstances① above to borrow at below market rates.

If the group forms financial liabilities from the contingent consideration recognized by the purchaser in the business

combination not under the same control, it shall be measured at fair value and its changes shall be recorded into the current profit

and loss for accounting treatment.

Conditions for termination of recognition of financial liabilities

When the current obligation of a financial liability has been discharged in whole or in part, the discharged part of the financial

liability or obligation shall cease to be recognized.The group and the creditors sign an agreement to replace the existing financial

liabilities by assuming new financial liabilities. If the contract terms of the new financial liabilities and the existing financial

liabilities are substantially different, the existing financial liabilities shall be terminated and the new financial liabilities shall be

recognized at the same time.If the Group materially amends all or part of the contract terms of the existing financial liability, it shall

terminate the recognition of the existing financial liability or part of it, and at the same time recognize the financial liability after the

modification as a new financial liability.The difference between the book value of the terminated recognition and the consideration

paid shall be recorded into the profit and loss of the current period.

3. Fair value determination method of financial assets and financial liabilities

The Group measures the fair value of financial assets and financial liabilities at the prices of major markets. If there is no

major market, the group measures the fair value of financial assets and financial liabilities at the prices of the most favorable market,

and adopts the valuation technology applicable at that time and supported by sufficient available data and other information.The

input value used in fair value measurement is divided into three levels, that is, the input value of the first level is the unadjusted

quotation of the same asset or liability in the active market that can be obtained on the measurement day;The input value of the

second level is the directly or indirectly observable input value of the related asset or liability in addition to the input value of the


60

first level;The third-level input values are the unobservable input values of the underlying asset or liability.The group uses the first

level input value first and the third level input value last.The level to which the fair value measurement results belong is determined

by the lowest level to which the input values that are of great significance to the fair value measurement as a whole belong.

The Group's investment in equity instruments is measured at fair value.However, in limited cases, if the recent information used

to determine the fair value is insufficient, or if the possible estimated amounts of the fair value are distributed over a wide range and

the cost represents the best estimate of the fair value within that range, the cost may represent the appropriate estimate of the fair

value within that range.

4. Offsetting of financial assets and financial liabilities

The financial assets and financial liabilities of the Group are presented separately in the balance sheet and do not offset each

other.However, if the following conditions are met at the same time, the net amount after mutual offset shall be shown in the

balance sheet :(1) the group has the legal right to offset the recognized amount, and this legal right is currently enforceable;(2) The

Group plans to net settle or realize the financial assets and liquidate the financial liabilities at the same time.

5. Distinction between financial liabilities and equity instruments and relevant treatment methods

The group distinguishes financial liabilities from equity instruments in accordance with the following principles :(1) if the

group cannot unconditionally avoid performing a contractual obligation by paying cash or other financial assets, the contractual

obligation meets the definition of a financial liability.Although some financial instruments do not explicitly contain terms and

conditions for the obligation to deliver cash or other financial assets, it is possible to indirectly form contractual obligations through

other terms and conditions.(2) if a financial tools must be used or the group settlement's own equity instruments are available, and

need to be considered for settlement of the tool of the group's own equity instruments, as a substitute for cash or other financial

assets, or in order to make the tool holder enjoy after deducting all liabilities of the issuer of the residual interest in the assets.In the

former case, the instrument is a financial liability of the issuer;In the latter case, the instrument is the equity instrument of the issuer.

In some cases, this group is to be a financial instrument contract with their rights or available tools to settle the financial tools,

including contractual rights or obligations under a contract amount equal to the available or have to pay when multiplied by the

number of its own equity instruments and settlement of the fair value, no matter the amount of the contract rights or obligations are

fixed,Or is it based in whole or in part on changes in variables other than the market price of the Group's own equity instrument

(such as interest rates, the price of a commodity or the price of a financial instrument), the contract is classified as a financial

liability.

In classifying financial instruments (or their components) in the consolidated statements, the Group has taken into account all

terms and conditions agreed between the members of the Group and the holders of the financial instruments.An instrument shall be

classified as a financial liability if the Group as a whole has obligations as a result of the instrument to deliver cash, other financial

assets or settle in any other manner that would cause the instrument to become a financial liability.

If financial instruments or their components are financial liabilities, the relevant interest, dividends (or dividends), gains or

losses, as well as the gains or losses generated by redemption or refinancing, the Group will record the profits and losses of the

current period.

If a financial instrument or any part thereof is an equity instrument, the Group shall treat the issue (including refinancing),

repurchase, sale or write-off of the instrument as a change in the equity and shall not recognize the change in the fair value of the

equity instrument.

6. Impairment of financial instruments

On the basis of expected credit losses, the Group performs impairment treatment and recognizes loss provisions for financial

assets measured at amortized cost and debt instrument investments measured at fair value and whose changes are included in other

comprehensive income.

Credit loss refers to the difference between all contractual cash flows receivable under the contract and all cash flows expected

to be received by the Group, discounted at the original effective interest rate, i.e. the present value of all cash shortfalls.Among


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them, the financial assets purchased or generated by the Group with credit impairment shall be discounted according to the credit

adjusted effective interest rate of the financial assets.

For receivables that do not contain a material financing component, the Group uses a simplified measurement method to

measure the loss provision at an amount equivalent to the expected credit loss over the entire duration.The Group shall assess on

each balance sheet date whether its credit risk has increased significantly since the initial recognition. If the credit risk has increased

significantly since the initial recognition, the Group shall measure the loss provision according to the amount equivalent to the

expected credit loss in the entire duration;If the credit risk does not increase significantly after the initial recognition, the Group

shall measure the loss provision according to the amount equivalent to the expected credit loss in the next 12 months.

The Group considers all reasonable and evidence-based information, including forward-looking information, in assessing

anticipated credit losses.

When the Group no longer reasonably expects to recover all or part of the contracted cash flow of the financial asset, the

Group directly writes down the book balance of the financial asset.

In addition to evaluating overdue credit losses of certain financial assets on a single-item basis, the Group also evaluates

expected credit losses of financial assets measured at amortized cost on an aging portfolio basis.

According to the credit risk characteristics, the Group divides notes receivable, accounts receivable and other receivables

into several combinations. On the basis of the combinations, the expected credit losses are calculated and the combinations are

determined on the following basis:

combination On the basis of

Notes receivable 1 Bank acceptance

Notes receivable 2 A combination of commercial acceptance bills received from a related party

Notes receivable 3 Combination of commercial acceptance bills received from non-associated parties

Accounts receivable 1 Combination of related parties

Accounts receivable 21 Aging combination

For the accounts receivable divided into combinations, the Group makes a comparison table between the age of accounts

receivable and the expected credit loss rate of the entire duration by referring to the historical credit loss experience and combining

the current situation and the forecast of future economic conditions to calculate the expected credit loss.

The Group divides other receivables into several combinations according to credit risk characteristics, and calculates

expected credit losses on the basis of the combinations. The combinations are determined on the following basis:

combination On the basis of

Other accounts receivable 1 Combination of related parties

Other receivables 2 Aging combination

Other accounts receivable 3 Risk-free portfolio (classified according to the reputation of the transaction

object, nature of funds, transaction safeguard measures, etc.)

For the other receivables divided into the portfolio, the Group calculates the expected credit loss through default risk

exposure and the expected credit loss rate of the entire duration by referring to the historical credit loss experience, combined with

the current situation and the forecast of future economic conditions.

11. Notes receivableSee Article 6 impairment of Financial Instruments12.Accounts receivableSee Article 6 impairment of Financial Instruments13. Receivables financing


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The mode of managing notes receivable of the Group is both to collect contract cash flow and to sell the financial asset, so it isclassified as the financial asset measured at fair value and its changes are included in other comprehensive income, and it is listed inthe receivables financing.14. Other receivablesDetermination method and accounting treatment method of expected credit loss of other receivablesSee Article 6 impairment of Financial Instruments15. inventoryClassification of inventory: Inventories are classified as raw material, wrappage, low-valuable consumable, working-in-progress,and finished goods etc.The inventories are processed on perpetual inventory system, and are measured at their budgeted cost on acquistion. The rawmaterials are accounted daily on their bedgeted costs. The differences between the budget and actual costs is recorded into the costsof materials purchased and cost of materials dispatched according to proportion of raw materials in stock and dispatched, and adjustthe budgeted costs of raw material into actual costs. The working-in-progress and finished goods are accounted on their budgetedcosts; the differences between the budgeted costs and actual costs are recorded into the costs of working-in-progress and finishedgoods according to proportion of inventory in stock and dispatched, and finaly adjust the budgetedcosts into actual costs.Inventoryusage and dispatch is measured at average cost as actual cost.Low value consumables and packaging materials is recognized in theincome statement by one-off method.At the balance sheet date inventory should be measured at the lower of the cost and net realizable value. For the inventories whichare damaged, fully or partly obsoleted and selling price below cost, the Group should calculate the provision for impairment ofinventories according to the estimated nonrecoverable part of cost. Finished goods and a large amount raw materials should becalculated provision for impairment based on the difference of the cost exceed the realizable value of single item. For raw andaccessorial materials with a large quantities and lower unit price should be calculated provison for impairment according toclassification of inventory.For the finished goods, working in progress and raw material held for sale etc which shall be sold directly, the net realizable valueshould be confirmed at the estimated selling price less estimated selling expenses and related tax and expenses. The raw materialheld for production, its realizable value should be confirmed at the estimated selling price of finished goods less estimated cost ofcompletion, estimated selling expenses and related tax.16.Contract asset

(1) Recognition and criterionContract asset is an entity's right to consideration in exchange for goods or services that the entity has transferred to a customerwhen that right is conditioned on something other than the passage of time. Contract asset and contract liability originated fromsame contact shall be listed at net amount.

(2) Expected credit loss recognition and accounting of contract assetExpected credit loss recognition of contract asset is referred to the Note IV.10 (6) . Provision for Impairment of FinancialInsturment.On the balance sheet date, expected credit loss of contract asset shall be calculated and the difference shall be recognized as theimpairment loss if the loss figure worked out is bigger than the carrying amount of the provision for impairment of contract asset,and debit "asset impairment loss”, credit "provision for impairment of contract asset”. On the contrary, the Company shallrecognize the difference as impairment profit and keep the opposite accounting record.If the actual credit loss incurred and the contract asset is unable to be collected with confirmation, after the approval is given, theloss shall be written off based on the approved amount and debit "provision for impairment of contract asset”, credit "contractasset”. If the amount to be written is greater than the provision, the difference shall be debited to "asset impairment loss”17.Contract cost

(1) Assets recognition methods in relation to contract costAssets relevant to contract cost in the company include cost to fulfill the contract and cost to obtain a contract.If the costs incurred in fulfilling a contract with a customer are not within the scope of another Standard, an entity shall recognize anasset from the costs incurred to fulfill a contract only if those costs meet all of the following criteria: the costs relate directly to acontract or to an anticipated contract, including direct labor, direct materials and overheads which is clearly stated to be borne bythe client and any other cost in line with the contract; the costs enhance resources of the entity that will be used in performanceobligations in the future; and the costs are expected to be recovered.An entity shall recognize an asset as the incremental costs of obtaining a contract with a customer if the entity expects to recoverthose costs. an entity may recognize the incremental costs of obtaining a contract as an expense when incurred if the amortizationperiod of the asset t is one year or less. The incremental costs of obtaining a contract are those costs that an entity incurs to obtain acontract with a customer that it would not have incurred if the contract had not been obtained (for example, a sales commission).


63

Costs to obtain a contract that would have been incurred rather than the incremental cost expected to be recovered shall berecognized as an expense when incurred, unless those costs are explicitly chargeable to the customer regardless of whether thecontract is obtained

(2) Amortization of asset relevant to contract costAn asset recognized in accordance with contract cost shall be amortized on a systematic basis that is consistent with the transfer tothe customer of the goods or services to which the asset relates.

(3) Impairment of asset relevant to contract costWhen determining the impairment loss of the assets related to the contract cost, the Company shall firstly determine the impairmentloss of the assets related to the contract that are recognized in accordance with the other accounting standards. If the book value ofthe asset is higher than the remaining consideration expected to be obtained by the Company for the transfer of the goods related tothe asset and the estimated cost to be incurred for the transfer of the goods related to the asset, the excess part shall be withdrawn asan impairment provision and recognized as an impairment loss of the asset.An entity shall recognize in profit or loss a reversal of some or all of an impairment loss previously recognized when theimpairment conditions no longer exist or have improved. The increased carrying amount of the asset shall not exceed the amountthat would have been determined (net of amortization) if no impairment loss had been recognized previously.

18.Hold assets for sale

There is no

19. Debt investment

There is no

20. Other debt investment

There is no

21. Long-term receivables

There is no

22. Long-term equity investment

Long term equity investments are the investment in subsidiary, in associated company and in joint venture.Joint control is the contractual agreement sharing of control over an economic activity by all participants or participants'combination and decisions or policies relating to the operating activity of the entity require the unanimous consent of the partiessharing the control.Significant influence exists when the entity directly or indirectly owned 20% or more but less than 50% shares with voting rights inthe investee company.If holding less than 20% voting rights, the entity shall also take other facts or circumstances into accountswhen judging any significant influences. Factors and circumstances include: representation on the board of directors or equivalentgoverning body ofthe investee, participation in financial or operating activities policy-making processes,material transactionsbetween the investor and the investee, interchange of managerial personnel or provision of essential technical information.When control exists over an investee, the investee is a subsidiary of an entity. The initial investment cost for long-term equityinvestment acquired through business combination under common control, is the carrying amount presented in the consolidatedfinancial statements of the share of net assets at the combination date in the acquired company. If the carrying amount of net assetsat the combination date in the acquired company is negative, investment shall be recognized at zero.If the equity of investee under common control is acquired by stages and business combination incursin the end, an entity shalldisclose the accounting method for long-term equity investment in the parent financial statement as a supplemental. For example, ifthe equity of investee under common control is acquired by stages and business combination incursin the end, and it's a bundledtransaction, the entity shall regard all transactions as a one for accounting. If it's not a bundled transaction, the carrying amountpresented in the consolidated financial statements of the share of net assets at the combination date in the acquired company sinceacquisition is determined as for the initial cost of long-term equity investment. The difference between the cost initially recognizedand carrying amount of long-term equity investment prior to the business combination plus the newly paid consideration for furthershare acquired, and capital reserve shall be adjusted accordingly. If no enough capital reserve is available for adjustment, retainearnings shall be adjusted.If long-term equity investment is acquired through business combination not under common control, initial investment cost shall bethe combination cost.If the equity of investee not under common control is acquired by stages and business combination incursin the end, an entity shalldisclose the accounting method for long-term equity investment in the parent financial statement as a supplemental. If the equity


64

investment of investee not under common control is acquired by stages and business combination incursin the end, and it's abundled transaction, the entity shall regard all transactions as a one for accounting. If it's not a bundled transaction, the carryingamount of the equity investment held previously plus newly increased investment cost are taken as the initial investment cost undercost model. If equity investment is held under equity method before the acquisition date, other comprehensive income under equitymethod previously shall not be adjusted accordingly. When disposing of the investment, the entity shall adopt the same basis as theinvestee directly disposing of related assets or liability for accounting treatment. Equity held prior to acquisition date as availablefor sale financial assets under fair value model, accumulated change on fair value previously recorded in other comprehensive shallbe transferred into investment gain/loss for the period.Apart from the long-term equity investments acquired through business combination mentioned above, the cost of investment forthe long-term equity investments acquired by cash payment is the amount of cash paid. For long-term equity investment acquired byissuing equity instruments, the cost of investment is the fair value of the equity instrument issued. For long-term equity investmentinjected to the entity by the investor, the investment cost is the consideration as specified in the relevant contract or agreement.The Group adopts cost method to account for investment in subsidiary and equity method for investment in joint venture andaffiliate.Long-term equity investment subsequently measured under cost model shall increase the carrying amount of investment byadjusting the fair value of additional investment and relevant transaction expenses. Cash dividend or profit declared by investeeshall be recognized as investment gain/loss for the period based on the proportion share in the investee.Long-term equity investment subsequently measured under equity method shall be adjusted for its carrying amount according to theshare of equity increase or decrease in the investee. The entity shall recognize its share of the investee's net profits or losses basedon the fair value of the investee's individual identifiable assets at the acquisition date, after making appropriate adjustments theretoin conformity with the accounting policies and accounting period, and offsetting the unrealized profit or loss from internaltransactions entered into between the entity and its associates and joint ventures according to the shareholding attributable to theentity and accounted for as investment income and loss based on such basis.On disposal of a long-term equity investment, the difference between the carrying value and the consideration actually received isrecognised as investment income for the period. For long-term investments accounted for under equity method, the movements ofshareholder's equity, other than the net profit or loss, of the investee company, previously recorded in the shareholder's equity of theCompany are recycled to investment income for the period on disposal.Where the entity has no longer joint control or significant influence in the investee company as a result of partially disposal of theinvestment, the remaining investment will be changed to be accounted for as available for sale financial assets, and the differencebetween the fair value of remaining investment at the date of losing joint control or significant influence and its carrying amountshall be recognized in the profit or loss for the year. Other comprehensive income recognized from previous equity investmentunder equity model shall be accounted for on the same basis as the investee directly disposing of related assets or liability whenstopping using under equity model.Where the entity has no longer control over the investee company as a result of partially disposal of the investment, the remaininginvestment will be changed to be accounted for using equity method providing remaining joint control or significant influence overthe investee company. The difference between carrying amount of disposed investment and consideration received actually shall berecognised in the profit and loss for the period as investment gain or loss, and investment shall be adjusted accordingly as if it wasaccounted for under equity model since acquisition. Where the entity has on longer joint control or significant influence in theinvestee as a result of disposal, the investment shall be changed to be accounted for as available for sale financial assets, anddifference between the carrying amount and disposal consideration shall be recognized in profit and loss for the period, and thedifference between the fair value of remaining investment at the date of losing control and its carrying amount shall be recognizedin the profit or loss for the year as investment gain or loss.If the entity loses its control through partially disposal of investment by stages and it's not a bundled transaction, the entity shallaccount for all transactions separately. If it's a bundled transaction, the entity shall regard all transactions as one disposal ofsubsidiary by losing control, but the difference between disposal consideration and carrying amount of the equity investmentdisposed prior to losing control, which arises from each individual transaction shall be recognized as other comprehensive incomeuntil being transferred into profit and loss for the period by the time of losing control.

23.Investment propertyInvestment property of the Company includes land and property. Cost model is adpoted.Investment property is depreciated or amortized under straight line method. Estimated net residual value rate, useful life,depreciation rate as follows:


65

CategoryUseful life(years)

Estimated netresidual value rate

(%)

Annualdepreciation rate

Use right of land 40 8.33%

Property and buildings

Including: Buildings 15 3 6.47%

Housing for production 30 3 3.23%

Housing for non-production 35 3 2.77%

24.Fixed assets(1) Confirm the conditionsRecognition criteria of fixed assets: Fixed assets are defined as the tangible assets which are held for the purpose of producinggoods, rendering services, leasing or for operation & management, and have more than one year of useful life, and whose unit priceis over RMB2,000.Fixed assets shall be recognized when the economic benefit probably flows into the Group and its cost can be measured reliably.Fixed assets include: building, machinery, transportation equipment, electronic equipment and others.

(2) Depreciation methodAll fixed assets shall be depreciated unless the fixed assets had been fully depreciated and are still being used and land is separatelymeasuered. Straight-line depreciation method is adopted by the Group. Estimated net residual value rate, useful life, depreciationrate as follows:

No CategoryUseful life(years)

Estimated netresidual value

rate (%)

Annual depreciationrate

1 Housing and Buildings

Including: Buildings 15 3 6.47%

Housing for production 30 3 3.23%

Housing for non-production 35 3 2.77%

2 Machinery equipment 10-15 3 6.47%～9.70%

3 Transportation equipment 6 3 16.17%

4 Electronic equipment

Including: Computer 4 3 24.25%

General testing instruments 7 3 13.86%

Specialized electronic equipment 8 3 12.13%

Automated controlling equipment 8 3 12.13%

Automated controlling meters 8 3 12.13%

5 Others equipment

Including: Industrial kiln 7 3 13.86%

Tools & other production tools 9 3 10.78%

Transmission equipment 15 3 6.47%

Non-operational equipment and tools 18 3 5.39%

The company should review the estimated useful life, estimated net residual value and depreciation method at the end of each year.If any change has occurred, it shall be regarded as a change in the accounting estimates.

(3) the identification basis, valuation and depreciation method of the fixed assets leased through financing

No


66

25.Construction in progressThe criteria and time spot of constructions in progress's being transferred to fixed assets: Constructions in progress are carried downto fixed assets on their actual costs when completing and achieving estimated usable status. The fixed assets that have beencompleted and reached estimated usable status but have not yet been through completion and settlement procedures are charged toan account according to their estimate values; adjustment will be conducted upon confirmation of their actual values. The Groupshould withdraw depreciation in the next month after completion.

26.Borrowing costsThe borrowing cost includes the interest expenses of the borrowing, amortization of underflow or overflow from borrowings,additional expenses and the foreign exchange profit and loss because of foreign currency borrowings. The borrowing costs incurredwhich can be directly attribute to the fixed assets, investments properties, inventories requesting over 1 year purchasing ormanufacturing so to come into the expected condition of use or available for sale shall start to be capitalized when expenditure forthe assets is being occurred, borrowing cost has occurred, necessary construction for bringing the assets into expected condition foruse is in progress. The borrowing costs shall stop to be capitalized when the assets come into the expected condition of use oravailable for sale. The borrowing costs subsequently incurred should be recorded into profit and loss when occurred. The borrowingcosts should temporarily stop being capitalized when there is an unusual stoppage of over consecutive 3 months during the purchaseor produce of the capitalized assets, until the purchase or produce of the asset restart.The borrowing costs of special borrowings, deducting the interest revenue of unused borrowings kept in the bank or the investmentincome from transient investment should be capitalized. The capitalized amount of common borrowings should be calculated asfollows: average assets expenditure of the accumulated assets expenditure excess the special borrowing, multiplied by the capitalrate. The capital rate is the weighted average rate of the common borrowings.

27. Biological assetsThere is no

28. Oil and gas assetsThere is no

29. Right to use assets

The right to use assets refers to the right of the lessee to use the leased assets during the lease term, which shall be initially

measured at the cost.

In combination with the provisions of the new lease criteria, the new lease criteria will be implemented on January 1, 2021, and

simplified treatment will be adopted in the transition policy of the criteria, that is: lease liabilities are equal to the present value of

the remaining lease payments, and the use-right assets are equal to the lease liabilities and make necessary adjustments, and

depreciation and interest expense are recognized respectively.This method will not affect the company's retained earnings at the

beginning of 2021.

(1) Valuation method, service life and impairment test

Intangible assets of the Group include land use right, ERP software, other intangible assets, etc., which are measured according

to the actual cost at the time of acquisition. Among them, intangible assets purchased are measured according to the actual price

paid and other related expenses as the actual cost.The actual cost of intangible assets invested by investors shall be determined

according to the value agreed in the investment contract or agreement, but if the value agreed in the contract or agreement is not fair,

the actual cost shall be determined according to the fair value.

The right to the use of the land shall be amortized on an average basis according to the number of years during which the land is

granted from the date of grant;ERP software and other intangible assets will be amortized on the basis of the shortest expected

service life, the benefit life stipulated in the contract and the effective life stipulated in the law.The amortization amount is booked

into the relevant asset cost and current profit and loss according to the beneficiary.The expected service life and amortization

method of intangible assets with limited service life shall be reviewed at the end of each year. If there is any change, it shall be

treated as a change in accounting estimation.

(2) Internal research and development expenditure accounting policy

There is no

31.Impairment of long-term assets

There is no


67

32. Long-term deferred expenses

The long-term deferred expenses of the Group refer to the expenses that have been disbursed but should be borne by the

current period and subsequent periods with an amortization period of more than 1 year (excluding 1 year).Such expenses will be

amortized on average during the benefit period. If the long-term deferred expense item cannot benefit the subsequent accounting

period, the amortized value of the item which has not been amortized will be transferred to the current profit and loss.

33.Contract liabilityAn entity's obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount isdue) from the customer. Contract asset and contract liability originate from same contact shall be listed at net amount.

34..Employee compensation

(1) Accounting treatment of short-term compensation

Short-term compensation mainly include employee salaries, bonuses, allowances and subsidies, employee welfare, social

insurance and housing accumulation fund, employee education funds and union funds, provide service in the worker of the

accounting period, actual short-term compensation will be recognized as liabilities, and according to the benefit object recorded into

the profits and losses of the current or the relevant asset costs.

(2) Accounting treatment of post-employment benefits

Post-employment benefits mainly include basic pension insurance, unemployment insurance, etc. According to the risks and

obligations assumed by the company, they are classified into set contribution plan and set benefit plan.

For the set escrow plan, the escrow paid to a separate entity on the balance sheet date in exchange for the services provided by

the employee during the accounting period is recognized as a liability, and the profit and loss of the current period or the cost of

related assets are recorded according to the beneficiary.

(3) Accounting treatment of dismiss benefits

(4) Other accounting methods for long-term employee benefits

35.Lease liabilities

The lease liabilities shall be initially measured according to the present value of the outstanding lease payments on the

commencement date of the lease term.The lessee shall calculate the depreciation of the use-right assets with reference to the

relevant depreciation provisions of the Accounting Standards for Enterprises No. 4 - Fixed Assets, confirm whether the use-right

assets have been impaired in accordance with the provisions of the Accounting Standards for Enterprises No. 8 - Asset impairment,

and make accounting treatment for the identified impairment loss.

36. Estimated liabilities

When the business related to external guarantee, discount of commercial acceptance bill, pending litigation or arbitration,

product quality guarantee and other contingencies meet the following conditions at the same time, the Group recognizes it as a

liability: The obligation is the current obligation undertaken by the Group;The fulfillment of this obligation is likely to lead to the

outflow of economic benefits from the enterprise;The amount of this obligation can be measured reliably.

The estimated liabilities are initially measured in accordance with the best estimate of the expenses required to fulfill the

relevant current obligations, taking into account the risks, uncertainties and time value of money related to contingencies.If the time

value of money has a significant impact, the best estimate is determined by discounting the relevant future cash outflows.The

carrying value of the estimated liabilities is reviewed at each balance sheet date and, if changed, the carrying value is adjusted to

reflect the current best estimate.

37. Share payment

An equity-settled sharebased payment in exchange for services rendered by an employee, measured at the fair value of the

employee equity instrument at the grant date.The amount of the fair value shall be calculated and included in relevant costs or

expenses according to the straight line method on the basis of the best estimate of the number of feasible rights and equity

instruments during the waiting period, and the capital reserve shall be increased accordingly, if the right is feasible only after the

service is completed or the specified performance conditions are met.


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Cash-settled sharebased payments are measured at the fair value of the liabilities assumed by the Group on the basis of shares or

other equity instruments.If the right is available immediately after the grant, the fair value of the liabilities to be assumed shall be

included in the relevant costs or expenses on the grant date, and the liabilities shall be increased accordingly;If it is necessary to

complete the services in the waiting period or meet the specified performance conditions before the right is feasible, on each

balance sheet date of the waiting period, based on the best estimate of the right situation and according to the fair value amount of

the liabilities assumed by the Group, the services obtained in the current period shall be included in the cost or expense and the

liabilities shall be adjusted accordingly.

On each balance sheet date and the settlement date before the settlement of the relevant liabilities, the fair value of the liabilities

shall be re-measured, and its change shall be recorded into the profit and loss of the current period.

38.Preferred shares, perpetual bonds and other financial instruments39.incomeAccounting policies used in revenue recognition and measurementThe Group recognizes revenue when it performs its performance obligations under the contract, that is, when the customer obtains

control of the relevant goods or services.The specific criteria for the recognition of revenue from sales of goods: the company will deliverthe goods to the customer and confirm the realization of revenue from sales of goods.

If the contract contains two or more performance obligations, the Group shall, at the beginning of the contract, apportion thetransaction price to each individual performance obligation according to the relative proportion of the individual selling price of the goodsor services promised in each individual performance obligation, and measure the income according to the transaction price apportioned toeach individual performance obligation.

The transaction price is the amount of consideration the Group expects to be entitled to receive in connection with the transfer of

goods or services to customers, excluding payments received on behalf of third parties.The group recognizes transaction prices that

do not exceed the amount by which the cumulative recognized revenue is most likely not to be materially reversed when the

relevant uncertainty is removed.Amounts expected to be refunded to customers are not included in the transaction price as

liabilities.Where there is a significant financing component to the contract, the Group determines the transaction price on the basis

of the amount payable in cash that is assumed to be paid by the customer upon acquisition of control of the goods or services.The

difference between the transaction price and the contract consideration is amortized over the contract term using the effective

interest rate method.On the commencement date of the contract, the Group expects the customer to acquire control of the goods or

services within a period of one year from the time the customer pays the price, irrespective of the significant financing component

of the contract.

If one of the following conditions is met, the Group shall fulfill its performance obligations within a certain period of

time;Otherwise, the performance obligation shall be fulfilled at a certain point:

1. The customer obtains and consumes the economic benefits brought by the Group's performance of the contract at the same time.

2. The customer can control the goods under construction in the process of the Group's performance.

3. The commodities produced during the performance of the Group have irreplaceable uses, and the Group has the right to collect

the payment for the cumulative part of the performance completed so far during the entire contract period.

For performance obligations performed within a certain period of time, the Group recognizes revenue in accordance with the

performance progress during that period.When the performance schedule cannot be reasonably determined, if the group's costs

already incurred are expected to be compensated, revenue shall be recognized in accordance with the amount of costs already

incurred until the performance schedule can be reasonably determined.

For performance obligations performed at a certain point, the Group recognizes revenue at the point when the customer takes

control of the relevant goods or services.In determining whether a customer has acquired control of the goods or services, the Group

considers the following indications:

1. The Group has the current right to receive payment in respect of the goods or services.

2. The Group has transferred the legal ownership of the goods to the customer.

3. The Group has transferred the goods in kind to the customer.


69

4. The Group has transferred the principal risks and rewards of ownership of the goods to the customer.

5. The customer has accepted the goods or services, etc.

The Group's right to receive consideration for goods or services that have been transferred to customers is listed as contract assets,

which are set down for impairment on the basis of expected credit losses.

The group's unconditional right to receive consideration from customers is shown as an receivables.

The Group's obligation to transfer goods or services to customers for which it has received their consideration is presented as a

contractual liability.

Different business models of the same kind lead to differences in revenue recognition accounting policies

There is no

40.Government grantsA government grant is a monetary asset or non-monetary asset granted by government without consideration. It shall be recognizedwhen the company complies with the conditions attaching to the grant and when the company is able to receive the grant.Assets-related government grant is the government fund obtained by the company for the purpose of long-term assets purchase andconstruction or establishment in the other forms. Income-related grants are the grant given by the government apart from theassets-related grants. If no grant objective indicated clearly in the government documents, the company shall judge it according tothe principle mentioned above.Where a government grant is in the form of a transfer of monetary asset, it is measured at the amount received. Where a governmentgrant is made on the basis of fixed amount or conclusive evidence indicates relevant conditions for financial support are met andexpect to probably receive the fund, it is measured at the amount receivable. Where a government grant is in the form of a transferof non-monetary asset, it is measured at fair value. If fair value cannot be determined reliably, it is measured at a nominal amount ofRMB1 Yuan.Government grant are classified as assets-related government grants and income-related grants.Assets-related government grants are recognized as deferred income and assets are evenly amortized to profit or loss over the usefullife of the related asset.Any assets are sold, transferred, disposed off or impaired earlier than their useful life expired date, the remaining balance ofdeferred income which hasn't been allocated shall be carried forward to the income statement when the assets are disposed off.Income-related government grants that is a compensation for related expenses or losses to be incurred in subsequent periods arerecognized as deferred income and credited to the relevant period when the related expense are incurred. Government grantsrelating to compensation for related expenses or losses already incurred are charged directly to the profit or loss for the period.Government grants related to daily business, shall be recognized as other income in accordance with business nature, otherwise,shall be recognized as non-operating expenses.If the group obtains the discount interest of policy preferential loans, it shall follow the accounting standards according to thefollowing principles, in the case of either the financial allocation of discount interest funds to the lending bank or the financialallocation of discount interest funds directly to the group.

(1) If interest discount funds is given to the lending bank, and bank provides loans at a preferential interest rate to the group, the group'sborrowing cost is measured at the actual amount received, according to the loan principal and the preferential interest rate, work outborrowing expense (or the fair value of the loan is taken as borrowing costs and work out he borrowing expense at effective interestrate. Any difference between the amount received and FV is recognized as deferred income. Deferred income is amortised by usingeffective interest rate method within the loan term period and offset borrowing expense).

(2) If interest discount funds are given to the group directly, the preferential interest shall be offset the borrowing expense.If any government grant already recognized needs to be returned to the government, the accounting shall be differed according tothe following circumstances:

1) originally recognized as offsetting of related assets' book value, assets book value shall be adjusted,2) if any deferred income, book value of deferred income shall be offset, excessive portion shall be accounted into income statement,3) Other situation, it shall be accounted into income statement directly.41.Deferred tax assets and deferred tax liabilities

The deferred income tax assets or the deferred income tax liabilities should be recognized according to the differences (temporarydifference) between the carrying amount of the assets or liabilities and its tax base. Deferred tax assets shall be respectivelyrecognised for deductible tax losses that can be carried forward in accordance with tax law requirements for deduction of taxableincome in subsequent years. No deferred tax liabilities shall be recognized for any temporary difference arising from goodwillinitially recognition. No deferred tax assets or liabilities shall be recognized for any difference arising from assets or liabilities


70

initial recognition on non-business combination with no effect on either accounting profit or taxable profit (or deductible tax loss).At the balance sheet date, deferred tax assets and deferred tax liabilities are measured at the tax rates that are expected to apply tothe period when the asset is realised or liability is settled.

Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available to offset the deductible

temporary difference, deductible loss and tax reduction

42. Lease

(1) Accounting treatment of operating leases

Since January 1, 2021, the company in accordance with the Ministry of Finance issued "accounting standards for enterprises no. 21

- leasing" (finance and accounting) [2018] no. 35 to the relevant provisions of, increase the "right to use assets", "lease liability

subjects," on the lease beginning date, as the lessee, the company to the lease confirmation "right to use assets", "lease

liability,Finance lease and operating lease are no longer distinguished. All leases are recognized as entitled assets and lease

liabilities, and depreciation and interest expense are recognized respectively (the interest expense of lease liabilities in each period

of the lease term is calculated according to the fixed cyclical interest rate and recorded into the current profit and loss).

The company's implementation of the new leasing Standards this time for the adoption of transitional policy, the new leasing

standards allow the adoption of two methods: Method 1 is to allow enterprises to adopt retroactive adjustment;Method 2 is to adjust

the amount of retained earnings and other relevant items in the financial statements at the beginning of the year of the first

implementation of this Standard according to the cumulative impact of the first implementation of this Standard, without adjusting

the information of comparable periods.Meanwhile, method 2 provides a number of simplified processing arrangements.

The company adopts the above method 2 in the transitional policy of the criteria and adopts simplified treatment, that is: lease

liabilities are equal to the present value of the remaining lease payments, and the right to use assets are equal to the amount of lease

liabilities and make necessary adjustments.This method will not affect the company's retained earnings at the beginning of 2021.

(1) The right to use the assets refers to the lessee's right to use the leased assets during the lease term, which shall be initially

measured at the cost.

(2) Lease liabilities shall be initially measured at the present value of the outstanding lease payments on the commencement date of

the lease term.

The lessee shall calculate the depreciation of the use-right assets with reference to the relevant depreciation provisions of the

Accounting Standards for Enterprises No. 4 - Fixed Assets, confirm whether the use-right assets have been impaired in accordance

with the provisions of the Accounting Standards for Enterprises No. 8 - Asset impairment, and make accounting treatment for the

identified impairment loss.

(2) Accounting treatment of finance lease

43.Other important accounting policies and accounting estimates

44.Major changes in accounting policies and accounting estimates

(1) Significant accounting policy changes


The content and reason of accounting policy changeThe examination and

approval proceduresnote

On December 13, 2018, the Ministry of Finance

(MOF) issued the revised Accounting Standards for

Business Enterprises No. 21 - Leasing (Accounting

[2018] No. 35), which requires both domestic and

overseas listed enterprises and overseas listed

enterprises that use IFRS or ACCOUNTING Standards

for Business Enterprises to prepare financial

Approved by the board of

directors


71

statements,As of January 1, 2019;Other enterprises

implementing the accounting standards for Business

Enterprises shall come into force on January 1, 2021.In

accordance with the above notice and the provisions

and requirements of the accounting standards for

Enterprises, the company shall make corresponding

changes to the accounting policy of the original lease.

The items of "right to use assets" and "lease liabilities" will be added.In accordance with the transition policy, the Company has

chosen to simplify its treatment in implementing the new leasing guidelines, without adjusting early 2021 retained earnings and

without adjusting comparable period information.

(2) Significant changes in accounting estimates


(3) The first implementation of the new lease standards from 2021 to adjust the first implementation of the financial

statements at the beginning of the year related items


Whether it is necessary to adjust the balance sheet at the beginning of the year

Yes No

Consolidated balance sheet

In RMB Yuan

item 2020.12.31 2021.01.01 The adjusted number

Current assets:

Monetary fund 194,152,280.08 194,152,280.08

Settlement provision

Lending money,




Accounts receivable 975,628,091.12 975,628,091.12


prepayments 53,772,465.49 53,772,465.49

Premiums receivable

Reinsurance accounts

receivable

Reinsurance contract

reserves receivable





72

Purchase and resale of

financial assets

inventory 615,656,946.30 615,656,946.30

Contract assets


Non-current assets

maturing within one year



Non-current assets:

Issue loans and advance

payments

Creditor's rights

investment



Long-term equity

investment

Investment in other equity

instruments11,926,856.64 11,926,856.64

Other non-current financial

assets


Fixed assets 474,109,923.22 474,109,923.22


Productive biological

assets

Oil and gas assets

Right of use assets 1,256,680.47 1,256,680.47


The development of

spending

goodwill

Long-term deferred

expenses511,188.11 511,188.11

Deferred tax assets



73


Total assets 3,133,942,842.94 3,135,199,523.41



Borrowing from the central

bank

Funds borrowed from

Transactional financial

liabilities

Derivative financial

liabilities

Notes payable 274,654,535.65 274,654,535.65

Accounts payable 1,044,801,896.85 1,044,801,896.85

Advance payment


Sale of repurchase

financial assets

Take deposits and

inter-bank deposits

Acting to buy and sell

securities

Acting as an underwriter of

securities payments

Employee compensation

payable52,677,141.09 52,677,141.09

Payable taxes 3,688,168.68 3,688,168.68

Other payable 129,476,061.47 129,476,061.47


Dividends payable

Fees and commissions due

Reinsurance accounts

payable


Non-current liabilities due

within one year




74


Reserve for insurance

contract

Long-term borrowing

Bonds payable


Sustainable debt

Lease liability 1,256,680.47 1,256,680.47


Long-term employee

compensation payable

Estimated debts 39,032,270.91 39,032,270.91



Other non-current

liabilities



Owner's equity:

equity 402,600,000.00 402,600,000.00



Sustainable debt



Other comprehensive

income

The special reserve


General risk provision


Total owner's equity

attributable to the parent

company

814,004,967.89 814,004,967.89

Minority equity



75

Total liabilities and owners'

equity3,133,942,842.94 3,135,199,523.41

Adjustment fact Sheet






In conjunction with the provisions of the new Lease Criteria, the Board of Directors agreed to implement the new Lease criteria on

January 1, 2021, using the above method 2 as regards the transition policy of the Criteria, with a simplified treatment that the lease

liability is equal to the present value of the remaining lease payments and the use-right asset is equal to the amount of the lease

liability, subject to necessary adjustments.This method will not affect the company's retained earnings at the beginning of 2021.

In accordance with the above provisions, the Company recognizes use-right assets and lease liabilities and recognizes depreciation

and interest expense, respectively, for all leases (except short-term leases and low-value asset leases where the simplified treatment

is chosen) on January 1, 2021.

In accordance with the transition policy, the Company has chosen to simplify its treatment in implementing the new leasing

guidelines, without adjusting early 2021 retained earnings and without adjusting comparable period information.

Parent company balance sheet

In RMB Yuan

Item 2020.12.31 2021.01.01 Adjusted number

Current assets:

Monetary fund 173,606,464.84 173,606,464.84




Accounts receivable 1,051,197,353.63 1,051,197,353.63


prepayments 52,961,548.88 52,961,548.88




inventory 472,723,348.67 472,723,348.67

Contract assets


Non-current assets maturing within

one year




76

Non-current assets:




Long-term equity investment 211,583,897.67 211,583,897.67

Investment in other equity

instruments11,926,856.64 11,926,856.64



Fixed assets 309,847,783.81 309,847,783.81



Oil and gas assets

Right of use assets 1,256,680.47 1,256,680.47



goodwill


Deferred tax assets



Total assets 2,957,003,038.79 2,958,259,719.26





Notes payable 274,654,535.65 274,654,535.65

Accounts payable 845,753,616.99 845,753,616.99

Advance payment



Payable taxes 3,395,991.46 3,395,991.46

Other payable 109,599,140.08 109,599,140.08

Where: interest payable 1,041,600.00

Dividends payable


77


Non-current liabilities due within

one year




Long-term borrowing

Bonds payable


Sustainable debt

Lease liability 1,256,680.47 1,256,680.47


Long-term employee compensation

payable

Estimated debts 39,032,270.91 39,032,270.91


Deferred tax liabilities




Owner's equity:

equity 402,600,000.00 402,600,000.00



Sustainable debt




The special reserve





Adjustment fact Sheet




78




In conjunction with the provisions of the new Lease Criteria, the Board of Directors agreed to implement the new Lease criteria on

January 1, 2021, using the above method 2 as regards the transition policy of the Criteria, with a simplified treatment that the lease

liability is equal to the present value of the remaining lease payments and the use-right asset is equal to the amount of the lease

liability, subject to necessary adjustments.This method will not affect the company's retained earnings at the beginning of 2021.

In accordance with the above provisions, the Company recognizes use-right assets and lease liabilities and recognizes depreciation

and interest expense, respectively, for all leases (except short-term leases and low-value asset leases where the simplified treatment

is chosen) on January 1, 2021.

In accordance with the transition policy, the Company has chosen to simplify its treatment in implementing the new leasing

guidelines, without adjusting early 2021 retained earnings and without adjusting comparable period information.

(4) Retrospective adjustment of previous comparative data for the first implementation of the new lease criteria from 2021


45.other

VI.Taxation

1. The main applicable tax and rate to the Group as follows:

Tax Tax base Tax rate

Value-added tax (VAT) Sales revenue or Purchase 13%,9%,6%,5%

City construction tax Value-added tax payables 7%

Education surcharge Value-added tax payables 3%

Local education surcharge Value-added tax payables 2%

Enterprise income tax(EIT) Current period taxable profit 15% or 25%

Real estate tax 70% of cost of own property or revenue from leasing property 1.2% or 12%

Land use tax Land using right area RMB 6 per square meter

Notes: EIT rate for different tax payer

Tax principles EIT rate

Wazhou Liaoyang Bearing construction Co.,Ltd 15%

Dalian Wazhou Precision Motor Car Bearing Company Limited 25%

Wazhou Precision of Spherical Roller Bearings(Wafangdian)Co., Ltd 25%

2. Tax preference


79

The company obtained the qualification of high and new technology enterprises at 3 December, 2020.The Certificate No isGR202021200656, and the validity duration is three years. The subsidiary of the Company, Wazhou Liaoyang Bearingconstruction Co.,Ltd obtained the qualification of high and new technology enterprises at 15 September, 2020. The Certificate Nois GR202021000550 and the validity duration is three years. According to the tax law, the company can be granted for thepreferential tax policy of enterprise income tax rate of 15% in three years.

3.other

VI. Notes to Consolidated Financial Statements

1. Cash and cash in bank

In RMB Yuan

Item Closing Balance Opening Balance

Cash on hand 25,913.68 33,102.75

Bank deposits 194,772,300.48 163,695,697.22

Other monetary funds 19,050,405.69 30,423,480.11

A combined 213,848,619.85 194,152,280.08

2. Tradable financial asset

In RMB Yuan


Financial assets measured at fair value

and whose changes are included in

current profit and loss

411,407.31 228,046.00

Among them:

Among them:

A combined 411,407.31 228,046.00

3. Derivative financial assets

4. Notes receivable

(1) Classifying and listing of notes receivable.

In RMB Yuan


Bank acceptance 552,785,383.26 284,965,612.20

Commercial acceptance bill 67,022,215.00 131,078,966.28

A combined 619,807,598.26 416,044,578.48

In RMB Yuan

category

Closing Balance Opening Balance

Book balanceProvision for bad

debt

book

valueBook balance Provision for bad debt

book

value


80

amountproport

ionamount

Provisi

on

ratio

amountproporti

onamount

Provision

ratio

Among them:

Notes receivable for

which bad debt

provision is drawn

by combination

626,159,1

78.85

100.00

%

6,351,5

80.591.01%

619,80

7,598.2

6

422,39

6,159.0

7

6,351,58

0.591.50%

416,04

4,578.4

8

Among them:

A combined626,159,1

78.85

100.00

%

6,351,5

80.591.01%

619,80

7,598.2

6

422,39

6,159.0

7

6,351,58

0.591.50%

416,04

4,578.4

8

If the bad debt provision of notes receivable is drawn according to the general model of expected credit loss, please refer to

other receivables disclosure methods to disclose the relevant information of bad debt provision:


5. Accounts receivable

(1) Classified disclosure of accounts receivable

In RMB Yuan

category

Closing Balance Opening Balance

Book balanceProvision for bad

debtbook

value

Book balance Provision for bad debt

book

valueamount

propo

rtionamount

Provisi

on

ratio

amountpropor

tionamount

Provision

ratio

Accounts

receivable with

bad debt

provision drawn

on a single item

73,132,7

54.286.90%

73,132,

754.28

100.00

%

73,132,75

4.28

6.79

%

73,132,

754.28

100.00

%

Among them:

Accounts

receivable with a

combination of

bad debt

provisions

973,076,

032.60

93.01

%

28,707,

198.372.95%

944,36

8,834.

23

1,004,373

,533.99

93.21

%

28,745,

442.872.86%

975,628,

091.12

Among them:

-- Aging

combination

738,468,

242.98

70.59

%

28,707,

198.373.89%

709,76

1,044.

61

723,934,3

04.67

67.19

%

28,745,

442.873.97%

695,188,

861.80

-- Combination of 234,607, 22.42 234,60 280,439,2 26.03 280,439,


81

related parties 789.62 % 7,789.

62

29.32 % 229.32

total1,046,20

8,786.88

100.00

%

101,83

9,952.6

5

944,36

8,834.

23

1,077,506

,288.27

100.0

0%

101,87

8,197.1

5

975,628,

091.12

Withdrawal of bad debt provision by single item:

In RMB Yuan

Name

Closing balance

Book balanceProvision for

bad debt

Provision

ratioProvision for

Wafangdian Bearing Group Special Steel

Co. LTD5,092,669.00 5,092,669.00 100.00%

Not expected to

recover

Liaoning Yinheng Galvanized Color

Coated Steel Plate Co. LTD3,213,308.67 3,213,308.67 100.00%

Not expected to

recover

Shandong Hengji New Material Co., LTD 2,284,666.96 2,284,666.96 100.00%Not expected to

recover

Shandong Yuanda Board Industry

Technology Co., LTD1,804,722.77 1,804,722.77 100.00%

Not expected to

recover

Hesteel Company Limited Handan branch 1,608,611.42 1,608,611.42 100.00%Not expected to

recover

Angang Steel Company Limited 1,595,050.69 1,595,050.69 100.00%Not expected to

recover

Liaoning Wa shaft Bearing Sales Co., LTD 1,500,000.00 1,500,000.00 100.00%Not expected to

recover

Bazhou Tianli Pipe Co., LTD 1,325,600.76 1,325,600.76 100.00%Not expected to

recover

Zhejiang Yesheng New material Co., LTD 1,301,760.00 1,301,760.00 100.00%Not expected to

recover

Yingkou Iron & Steel Co. LTD 1,256,973.91 1,256,973.91 100.00%Not expected to

recover

Sichuan Southwest Stainless Steel Co. LTD 1,241,333.17 1,241,333.17 100.00%Not expected to

recover

Citic Heavy Industrial Machinery Co. LTD 1,137,600.00 1,137,600.00 100.00%Not expected to

recover

Henan Taihang Vibration Machinery Co.,

LTD989,207.41 989,207.41 100.00%

Not expected to

recover

Donghai New Material Co., LTD 942,558.20 942,558.20 100.00%Not expected to

recover

Shanghai Jieru Heavy Machinery

equipment Co., LTD923,603.80 923,603.80 100.00%

Not expected to

recover


82

Tangshan Guofeng Iron & Steel Co. LTD 883,297.41 883,297.41 100.00%Not expected to

recover

China second heavy machinery Group

(Deyang) Wanxin Engineering Equipment

Co., LTD

795,887.92 795,887.92 100.00%Not expected to

recover

Benxi Beiying Iron & Steel (Group) Co.

LTD775,804.98 775,804.98 100.00%

Not expected to

recover

Bengang Steel Plates Co., Ltd 770,000.00 770,000.00 100.00%Not expected to

recover

Materials Branch of North Heavy Industry

Group Co. LTD739,585.80 739,585.80 100.00%

Not expected to

recover

Shandong Yuntong New Material

Technology Co., LTD711,438.94 711,438.94 100.00%

Not expected to

recover

Dongfeng Motor Transmission Co. LTD 704,098.23 704,098.23 100.00%Not expected to

recover

Heilongjiang Longmei Logistics Co. LTD 692,070.49 692,070.49 100.00%Not expected to

recover

Shanghai Weiqiang Heavy Machinery Co.,

LTD673,595.42 673,595.42 100.00%

Not expected to

recover

Dalian Tianyuan Motor Co., LTD 666,383.31 666,383.31 100.00%Not expected to

recover

Wolong Electric Huaian Qingjiang Motor

Co., LTD598,873.78 598,873.78 100.00%

Not expected to

recover

Qiqihar No.2 Machine Tool (Group) Co.

LTD551,450.03 551,450.03 100.00%

Not expected to

recover

Xi 'an Jossbo Hydraulic Engineering Co.

LTD514,938.87 514,938.87 100.00%

Not expected to

recover

Gaotang Lvyin Environmental Protection

Technology Co., LTD477,691.81 477,691.81 100.00%

Not expected to

recover

Mudanjiang city speed reducer Factory 467,905.65 467,905.65 100.00%Not expected to

recover

Hunan Chaoyang Electromechanical Co.,

LTD446,627.60 446,627.60 100.00%

Not expected to

recover

Liaoyang Sudong Trading Company 444,946.96 444,946.96 100.00%Not expected to

recover

Xiangtan Motor Co., LTD 416,549.65 416,549.65 100.00%Not expected to

recover

Baoji Faithful Industry and Trade Co., LTD 374,594.68 374,594.68 100.00%Not expected to

recover

Boshan Motor Factory Group Co., LTD 373,700.65 373,700.65 100.00% Not expected to


83

recover

Xuzhou XCMG Material Supply Co., LTD 373,237.55 373,237.55 100.00%Not expected to

recover

Qingdao Double star Tyre Industry Co.,

LTD371,251.58 371,251.58 100.00%

Not expected to

recover

Shandong Quanlin Group Co. LTD 370,734.92 370,734.92 100.00%Not expected to

recover

Minmetals Yingkou Plate Co. LTD 365,064.61 365,064.61 100.00%Not expected to

recover

Tai 'an Tianhua trade Co., LTD 364,189.79 364,189.79 100.00%Not expected to

recover

Tangshan Huahang Electromechanical

chuangxian Equipment Co., LTD362,498.40 362,498.40 100.00%

Not expected to

recover

Liaohe Machinery Factory 362,280.30 362,280.30 100.00%Not expected to

recover

Shandong Kerui Steel Plate Co. LTD 357,290.00 357,290.00 100.00%Not expected to

recover

Guangzhou Supplies section of China

Railway Guangzhou Bureau Group Co.,

LTD

340,000.00 340,000.00 100.00%Not expected to

recover

Yichang Guocheng Coating plate Co., LTD 339,600.00 339,600.00 100.00%Not expected to

recover

Shantui Construction Machinery Co., Ltd. 325,867.86 325,867.86 100.00%Not expected to

recover

Shandong tancheng new Asia light industry

machinery limited company318,488.87 318,488.87 100.00%

Not expected to

recover

Beiman Special Steel Co. LTD of Northeast

Special Steel Group315,004.72 315,004.72 100.00%

Not expected to

recover

Taicang Hutai Chang 'e Papermaking

Equipment Co. LTD310,361.32 310,361.32 100.00%

Not expected to

recover

Shandong Quelin Straw Comprehensive

Utilization Co., LTD307,409.46 307,409.46 100.00%

Not expected to

recover

Panzhihua Group Chengdu Iron & Steel

Co. LTD303,305.45 303,305.45 100.00%

Not expected to

recover

Harbin Haoke Electric Power Technology

Co. LTD303,005.32 303,005.32 100.00%

Not expected to

recover

Hebei Jinxi Iron & Steel Group Co. LTD 298,307.04 298,307.04 100.00%Not expected to

recover

Wazhuan Group Liaoyang bearing

Manufacturing Co., LTD bearing sales

Branch

294,203.05 294,203.05 100.00%Not expected to

recover


84

Sinoma Zibo Heavy Machinery Co., LTD 293,817.58 293,817.58 100.00%Not expected to

recover

Jiangsu Xinrui Gear System Co., LTD 286,949.88 286,949.88 100.00%Not expected to

recover

Erzhong Group (Deyang) Jingheng

Transmission Equipment Co., LTD286,935.03 286,935.03 100.00%

Not expected to

recover

Xingtai Iron & Steel Co. LTD 285,834.67 285,834.67 100.00%Not expected to

recover

Hegang Star Mechanical and electrical

Equipment Manufacturing Co. LTD285,313.50 285,313.50 100.00%

Not expected to

recover

Shanxi Taigang Stainless Steel Co.,Ltd 283,936.85 283,936.85 100.00%Not expected to

recover

Shandong Guanpeng Metal Sheet Co., LTD 273,748.84 273,748.84 100.00%Not expected to

recover

Baotou Tianli Huanfa Mechanical and

Electrical Co., LTD273,597.67 273,597.67 100.00%

Not expected to

recover

Baoji Loyalty Machine Tool Co., LTD 269,908.74 269,908.74 100.00%Not expected to

recover

Jiangsu Dazhong Electric Co., LTD 257,662.90 257,662.90 100.00%Not expected to

recover

Korla railway supplies section 256,044.10 256,044.10 100.00%Not expected to

recover

Zhuzhou Gear Co., LTD 254,604.07 254,604.07 100.00%Not expected to

recover

Jiamusi Electric Motor Co., LTD 245,000.00 245,000.00 100.00%Not expected to

recover

Zibo Boshan Qianjin reducer Factory Co.,

LTD244,579.32 244,579.32 100.00%

Not expected to

recover

Indonesia CV.SIDO Company 243,676.52 243,676.52 100.00%Not expected to

recover

Tonghua Iron & Steel Co. LTD 240,568.39 240,568.39 100.00%Not expected to

recover

Shijiazhuang Qiangda slurry pump Co.

LTD238,749.98 238,749.98 100.00%

Not expected to

recover

Ningbo Fan Co., LTD 238,487.84 238,487.84 100.00%Not expected to

recover

Shenyang Jingxin Remanufacturing Co.,

LTD236,705.64 236,705.64 100.00%

Not expected to

recover

Siemens Motors (China) Co., LTD 228,831.20 228,831.20 100.00%Not expected to

recover


85

Yichang Jiandao Trading Co., LTD 226,995.16 226,995.16 100.00%Not expected to

recover

Anshan Heavy Duty Mining Machinery

Co., Ltd.216,819.90 216,819.90 100.00%

Not expected to

recover

Heavy coal Machine Co. LTD 215,142.12 215,142.12 100.00%Not expected to

recover

Qinhuangdao Shouqin Metal Material Co.,

LTD213,911.48 213,911.48 100.00%

Not expected to

recover

Liaoning Renda Equipment Technology

Co., LTD211,464.69 211,464.69 100.00%

Not expected to

recover

CRRC Shenyang Locomotive & Rolling

stock Co. LTD205,145.45 205,145.45 100.00%

Not expected to

recover

Panzhihua Vanadium Steel Co., LTD 203,004.70 203,004.70 100.00%Not expected to

recover

Taizhou Luqiao Meitian Motorcycle Co.,

LTD200,562.00 200,562.00 100.00%

Not expected to

recover

Tianjin Rongtai New composite Material

Co., LTD200,000.00 200,000.00 100.00%

Not expected to

recover

Hangzhou Qianjin Gear Box Group Co.,

LTD199,832.70 199,832.70 100.00%

Not expected to

recover

Hebei Wenfeng Iron & Steel Co. LTD 197,979.65 197,979.65 100.00%Not expected to

recover

Suzhou Prospect Mechanical and Electrical

Equipment Co. LTD192,173.26 192,173.26 100.00%

Not expected to

recover

Guangzhou Motor Factory 189,128.68 189,128.68 100.00%Not expected to

recover

Hubei WaAxis Xin Sheng Technology Co.,

LTD188,136.00 188,136.00 100.00%

Not expected to

recover

Handan Sida Motor Co., LTD 186,191.80 186,191.80 100.00%Not expected to

recover

Nanjing Light Industrial Machinery Factory 185,079.54 185,079.54 100.00%Not expected to

recover

Jiangsu Suye Heavy Industry Machinery

Manufacturing Co. LTD184,530.46 184,530.46 100.00%

Not expected to

recover

Shanxi Sente coal coking Engineering

Group Co., LTD. Wenxi Branch182,700.00 182,700.00 100.00%

Not expected to

recover

Huichang Red Lion Cement Co. LTD 181,644.58 181,644.58 100.00%Not expected to

recover

Gulf World Trading Corporation of India 179,376.85 179,376.85 100.00%Not expected to

recover


86

Huaibei Mining (group) coal industry

Limited liability company materials branch178,580.44 178,580.44 100.00%

Not expected to

recover

Shanghai Sule Textile Machinery Co., LTD 176,984.10 176,984.10 100.00%Not expected to

recover

Shijiazhuang Electric Machinery Co., LTD 172,543.31 172,543.31 100.00%Not expected to

recover

Jiamusi Coal Mine Machinery Co. LTD 171,288.78 171,288.78 100.00%Not expected to

recover

Xuzhou Sinoma Equipment Heavy

Machinery Co. LTD170,930.05 170,930.05 100.00%

Not expected to

recover

Changsha Motor Factory Co. LTD 170,295.76 170,295.76 100.00%Not expected to

recover

Austria Andritz Technology Co., LTD.

(Foshan)166,787.14 166,787.14 100.00%

Not expected to

recover

Xuzhou Meici Bridge Co., LTD 163,037.45 163,037.45 100.00%Not expected to

recover

Shanghai Zhongli Machinery

Manufacturing Co., LTD161,388.95 161,388.95 100.00%

Not expected to

recover

Foshan Ketai Electromechanical Co., LTD 160,772.79 160,772.79 100.00%Not expected to

recover

Siping blower Co., LTD 160,053.21 160,053.21 100.00%Not expected to

recover

Anyang Coal mine Motor Factory 159,537.60 159,537.60 100.00%Not expected to

recover

Dalian Hongyun Transmission Technology

Development Co., LTD158,972.00 158,972.00 100.00%

Not expected to

recover

Shanxi Motor Factory 158,021.97 158,021.97 100.00%Not expected to

recover

Shenhua Materials Group Co. LTD 155,115.29 155,115.29 100.00%Not expected to

recover

Hubei All-out Machinery Group Co. LTD 152,489.82 152,489.82 100.00%Not expected to

recover

Guangdong Zhaoqing Jialong Packaging

Machinery Group Co. LTD150,313.94 150,313.94 100.00%

Not expected to

recover

Wuxi Yutong Bearing Co., LTD 149,427.42 149,427.42 100.00%Not expected to

recover

Yixing Chaoqun Machinery equipment Co.,

LTD138,484.00 138,484.00 100.00%

Not expected to

recover

Zhejiang Tongli Heavy Machinery

Manufacturing Co., LTD133,670.00 133,670.00 100.00%

Not expected to

recover


87

China First Heavy Industry Group Co. LTD 132,135.01 132,135.01 100.00%Not expected to

recover

Kunming Electric Machinery Factory Co.

LTD131,455.02 131,455.02 100.00%

Not expected to

recover

Jiangsu Gangyi Heavy Industry Co., LTD 129,036.10 129,036.10 100.00%Not expected to

recover

Guilin Hongcheng Mining equipment


Not expected to

recover

Shanghai Sule Textile Machinery Co., LTD 126,752.70 126,752.70 100.00%Not expected to

recover

Guangxi Beibu Gulf New Material Co.,

LTD126,353.69 126,353.69 100.00%

Not expected to

recover

Shenyang Qunding Machinery Equipment

Co., LTD126,286.35 126,286.35 100.00%

Not expected to

recover

Tangshan Dunshi Machinery


Not expected to

recover

Shenyang Machine Tool (Group) Co., LTD.

Precision CNC Machine Tool Branch124,002.02 124,002.02 100.00%

Not expected to

recover

Nantong Hengrong machine pump Factory

Co., LTD123,407.18 123,407.18 100.00%

Not expected to

recover

Guangxi Tianyang Huami Paper Industry

Co., LTD122,629.00 122,629.00 100.00%

Not expected to

recover

Taiyuan Heavy Industry Co. LTD 121,560.19 121,560.19 100.00%Not expected to

recover

Zhejiang RIFAPrecision Machinery

Co.,Ltd.120,214.46 120,214.46 100.00%

Not expected to

recover

China Railway Materials Shenyang

Company115,750.43 115,750.43 100.00%

Not expected to

recover

Wuhan Aotebi Motor Co., LTD 115,009.60 115,009.60 100.00%Not expected to

recover

Wuxi Computer Numerical Control Co.,

LTD114,412.20 114,412.20 100.00%

Not expected to

recover

John Deere Jia Lian harvesting Machinery

Co. LTD114,127.98 114,127.98 100.00%

Not expected to

recover

Nantong Motor Factory 113,634.74 113,634.74 100.00%Not expected to

recover

Qinhuangdao Huayye Motor Co., LTD 111,564.44 111,564.44 100.00%Not expected to

recover

Shandong Baoding Coal and Coking Co.

LTD110,528.29 110,528.29 100.00%

Not expected to

recover


88

Shenyang SAIC Jinbei Automobile

Transmission Co., LTD109,908.15 109,908.15 100.00%

Not expected to

recover

Dalian Dalma Motor Co., LTD 109,553.86 109,553.86 100.00%Not expected to

recover

Orient Iron & Steel Co. LTD 108,997.44 108,997.44 100.00%Not expected to

recover

Yingkou Jia Chen Burning chemical Co.,

LTD108,451.55 108,451.55 100.00%

Not expected to

recover

Tongchuan explosion-proof motor Factory 105,476.07 105,476.07 100.00%Not expected to

recover

China Pingcoal what energy chemical

group Limited liability company104,296.17 104,296.17 100.00%

Not expected to

recover

Jilin Jiaohe coal machine Manufacturing

Co. LTD102,965.96 102,965.96 100.00%

Not expected to

recover

DBI Corporation of America 102,568.64 102,568.64 100.00%Not expected to

recover

Changchun Power Generation Equipment

Co. LTD100,536.11 100,536.11 100.00%

Not expected to

recover

The total of other individual items 12,676,958.90 12,676,958.90 100.00%Not expected to

recover

Total 73,132,754.28 73,132,754.28 -- --

If the accounts receivable bad debt provision is drawn according to the general model of expected credit loss, please refer to other

receivables disclosure methods to disclose the relevant information of bad debt provision:


Disclosure by age

In RMB Yuan

age Closing balance

Within 1 year (including 1 year) 882,813,012.05

1 to 2 years 63,214,142.86

2 to 3 years 17,777,160.64

More than 3 years 82,404,471.33

3 to 4 years 29,454,636.22

4 to 5 years 15,247,533.02


A combined 1,046,208,786.88

(2) Bad debt provisions drawn, collected or transferred back in the current period

Provision for bad debts in the current period:

In RMB Yuan


89

categoryOpening

balance

Current change amountClosing

balanceprovisionTo withdraw or

reverse

Cancel after

verificationother

Provision for

bad debt101,878,197.15 30,000.00 8,244.50 101,839,952.65

A combined 101,878,197.15 30,000.00 8,244.50 101,839,952.65

(3) accounts receivable actually written off in the current period

(4) The top five accounts receivable according to the ending balance collected by the debtor

In RMB Yuan

NameEnding balance of accounts

receivable

The proportion of total ending

balance of accounts receivable

Ending balance of allowance

for bad debts

Customer 1 104,686,090.70 10.01%

Customer 2 32,769,278.70 3.13% 289,421.32

Customer 3 21,503,960.05 2.06% 217,113.29

Customer 4 15,438,858.26 1.48% 143,494.39

Customer 5 15,348,753.77 1.47% 105,384.95

combined 189,746,941.48 18.15%

6. Receivables financing

In RMB Yuan

project Closing balance Opening balance

Bank acceptance 71,227,468.25 72,593,534.75


total 129,580,519.36 130,600,545.59

Changes in the amount of receivables financing in the current period and changes in fair value


If the impairment provision of receivables financing is drawn in accordance with the general model of expected credit loss, please

refer to other receivables disclosure methods to disclose the relevant information of impairment provision:


Other notes:

7. Payment in advance

(1) Payment in advance shall be shown according to the age of the account

In RMB Yuan

agingClosing balance Opening balance

account ratio account ratio

Within 1 year 19,201,686.83 87.06% 52,189,932.41 97.06%


90

1 to 2 years 1,291,112.30 5.85% 1,297,764.53 2.41%

2 to 3 years 1,464,721.71 6.64% 284,768.55 0.53%

More than 3 years 98,138.27 0.44%

A combined 22,055,659.11 -- 53,772,465.49 --

(2) The advance payments of the top five in the closing balance collected by the prepaid object

name Closing balance age Proportion to total balance

of prepayments at year-end

(%)

Wafangdian Bearing Precision Forging co.

LTD

9,800,439.22 Within a year 44.44

Fushun Special Steel Co. LTD 6,035,186.31 Within a year 27.36

Wafangdian Far East Bearing Co., LTD 1,500,000.00 Within a year 6.80

Dalian Xiangrui Railway Equipment Co. LTD 1,500,000.00 Within a year 6.80

Zhejiang RIFA Precision Machinery Co.,Ltd. 1,164,000.00 Within a year 5.28

A combined 18,835,625.53 —— 85.40

8. Other receivables

In RMB Yuan

item Closing balance Opening balance

Other receivables 11,290,749.69 14,204,144.25

total 11,290,749.69 14,204,144.25

(1) Interest receivable

(2) Dividends receivable

(3) Other accounts receivable

2) Provision for bad debts

In RMB Yuan

Provision for bad debt

The first stage The second stage The third stage

TotalExpected credit

losses over the next

12 months

Expected credit loss for

the entire duration (no

credit impairment occurs)


the entire duration (credit

impairment incurred)

Balance as of January

1, 20217,169,695.56 7,169,695.56

January 1, 2021

balance in current

period

—— —— —— ——

Balance on June 30,

20217,169,695.56 7,169,695.56

Loss provision Changes in current period significant changes in book balance


91


Disclosure by age

In RMB Yuan

age Closing balance


1 to 2 years 799,115.02

2 to 3 years 269,000.84


3 to 4 years 325,917.88

4 to 5 years 1,487,646.00


A combined 18,460,445.25

3) Bad debt provisions drawn, collected or transferred back in the current period


In RMB Yuan

categoryClosing

balance


balanceprovisionTo withdraw or

reverse

Cancel after

verificationother

Other accounts

receivable bad

debt provision

7,169,695.56 7,169,695.56

total 7,169,695.56 7,169,695.56

9. inventory

Whether companies are required to comply with disclosure requirements in the real estate industry

no

(1) Inventory classification

In RMB Yuan

project

Closing balance Opening balance

Book balance

Provision for

inventory

decline or

impairment of

contract

performance

cost

The book value Book balance

Provision for

inventory

decline or

impairment of

contract

performance

cost

The book value

The raw

materials83,181,077.78 5,904,690.57 77,276,387.21 78,227,553.26 9,089,557.91 69,137,995.35

In the product 32,840,859.15 377,941.98 32,462,917.18 27,387,906.76 421,834.87 26,966,071.89


92

Inventory

goods718,309,340.62 203,236,563.05 515,072,777.57 648,144,216.90 263,961,842.93 384,182,373.97

Send goods 62,336,535.71 62,336,535.71 73,801,865.07 73,801,865.07

Homemade

semi-finished

product

101,140,235.07 27,286,413.30 73,853,821.76 91,906,231.80 30,455,364.33 61,450,867.47

Low value

consumables

and packaging

123,375.55 123,375.55 117,772.55 117,772.55

Total 997,931,423.88 236,805,608.90 761,125,814.98 919,585,546.34 303,928,600.04 615,656,946.30

(2) Reserve for inventory decline and reserve for impairment of contract performance cost

In RMB Yuan

projectOpening

balance

Current increase Current reductionClosing

balanceprovision otherturn back or

sellother

The raw

materials9,089,557.91 3,184,867.34 5,904,690.57

In the product 421,834.87 43,892.89 377,941.98

Inventory

goods263,961,842.93 60,725,279.88 203,236,563.05

Homemade

semi-finished

product

30,455,364.33 3,168,951.03 27,286,413.30

A combined 303,928,600.04 67,122,991.14 236,805,608.90

10. Contract assets

11. Hold assets for sale

12. Non-current assets due within one year

13. Other current assets

In RMB Yuan


VAT to be deducted 10,712,609.56 24,517,849.43

VAT to be certified 92,599.50

A combined 10,712,609.56 24,610,448.93

14. Debt investment

15. Other debt investment

16. Long-term receivables


18. Investment in other equity instruments


93

In RMB Yuan


Shanghai Amyi Electromechanical

Equipment Chain Co., LTD2,000,000.00 2,000,000.00

Qian 'an Zhanyi Iron and Steel Group

Co. LTD2,503,766.95 2,503,766.95

Dalian Longhui Industry and Trade Co.,

LTD7,423,089.69 7,423,089.69

A combined 11,926,856.64 11,926,856.64

19. Other non-current financial assets

20.Investment real estate

(1) Investment real estate using the cost measurement model


In RMB Yuan

project House, building Land use rightProjects under

constructiontotal

I. the original book value

1. Opening balance 171,156,035.71 49,954,300.64 221,110,336.35

2. Increase in the current

period11,222,201.84 0.00 11,222,201.84

(1) Outsourcing 11,222,201.84 0.00 11,222,201.84

(2) Inventory/fixed

assets/construction in

progress transfer

0.00 0.00

(3) Increased business

mergers0.00 0.00

3. Reduced amount in the

current period30,263,620.49 0.00 30,263,620.49

(1) Disposal 30,263,620.49 0.00 30,263,620.49

(2) Other roll out 0.00 0.00 0.00

4. Ending balance 152,114,617.06 49,954,300.64 202,068,917.70

II.Accumulated

depreciation and

accumulated amortization

1. Opening balance 86,016,869.91 17,576,984.05 103,593,853.96


period1,864,052.43 624,421.15 2,488,473.58

(1) Provision or 1,864,052.43 624,421.15 2,488,473.58


94

amortization


current period19,472,689.56 19,472,689.56

(1) Disposal 19,472,689.56 0.00 19,472,689.56

(2) Other roll out 0.00 0.00

4. Ending balance 68,408,232.78 18,201,405.20 86,609,637.98

III.Provision for

impairment

1. Opening balance


period

(1) Withdrawal

3. Reduced amount for the

current period

(1) Disposal

(2) Other roll out

4. Ending balance

Iv. Book value

1. Closing book value 83,706,384.28 31,752,895.44 115,459,279.72

2. Starting book value 85,139,165.80 32,377,316.59 117,516,482.39

21. Fixed assets

In RMB Yuan


Fixed assets 402,752,098.78 474,109,923.22

A combined 402,752,098.78 474,109,923.22

(1) Fixed assets

In RMB Yuan

item House buildingMachine

equipment

Transport

equipment

Electronic

equipment

Other

equipmentTotal

I.the original

book value:

1. Opening

balance264,336,605.71

1,049,807,784.

1214,509,177.09 62,291,443.33 211,182,772.67

1,602,127,782.

92

2. Increase in the

current period1,400,044.53 5,339,468.57 869,179.30 59,929.73 7,668,622.13

(1) Purchase 1,400,044.53 1,772,054.13 807,431.83 10,424.78 3,989,955.27

(2) Transfer of 3,567,414.44 61,747.47 49,504.95 3,678,666.86


95

construction

under

construction

(3) Increased

business mergers

3. Reduced

amount in the

current period

3,509,725.64 86,804,654.10 807,877.78 2,201,604.08 512,259.91 93,836,121.51

(1) Disposal or

scrapping3,509,725.64 86,804,654.10 807,877.78 2,201,604.08 512,259.91 93,836,121.51

4. Ending balance 262,226,924.60 968,342,598.59 13,701,299.31 60,959,018.55 210,730,442.491,515,960,283.

54

II.Accumulated

depreciation

1. Opening

balance179,069,027.56 688,715,910.19 12,767,249.79 50,886,574.18 168,246,931.93

1,099,685,693.

65

2. Increase in the

current period7,335,848.37 25,740,377.47 225,605.31 1,449,538.65 2,879,045.97 37,630,415.77

(1) Withdrawal 7,335,848.37 25,705,228.55 225,605.31 1,449,538.65 2,879,045.97 37,595,266.85

(2) Other

transfers35,148.92 35,148.92

3. Reduced

amount in the

current period

3,508,921.12 38,529,748.41 786,797.03 2,128,006.10 460,079.10 45,413,551.76

(1) Disposal or

scrapping3,508,921.12 38,529,748.41 786,797.03 2,128,006.10 460,079.10 45,413,551.76

4. Ending balance 182,895,954.81 675,926,539.25 12,206,058.07 50,208,106.73 170,665,898.801,091,902,557.

66

III.Provision for

impairment

1. Opening

balance19,879,546.61 1,648.28 621,345.40 7,829,625.76 28,332,166.05

2. Increase in the

current period

(1) Withdrawal

3. Reduced

amount in the

current period

7,000,183.37 1,648.28 24,707.30 7,026,538.95

(1) Disposal or 7,000,183.37 1,648.28 24,707.30 7,026,538.95


96

scrapping

4. Ending balance 12,879,363.24 596,638.10 7,829,625.76 21,305,627.10

Iv. Book value

1. Closing book

value79,330,969.79 279,536,696.10 1,495,241.24 10,154,273.72 32,234,917.93 402,752,098.78

2. Starting book

value85,267,578.15 341,212,327.32 1,740,279.02 10,783,523.75 35,106,214.98 474,109,923.22

(2) Temporary idle fixed assets

In RMB Yuan

projectThe original value

of the book

Accumulated

depreciationImpairment loss The book value note

Machinery and

equipment48,248,051.62 26,970,764.43 13,668,599.30 7,608,687.89

Transportation

equipment

Electronic

equipment855,496.06 587,414.96 243,291.78 24,789.32

Other equipment 600,378.22 434,984.85 152,525.41 12,867.96

A combined 49,703,925.90 27,993,164.24 14,064,416.49 7,646,345.17

(3) Fixed assets leased through operating leases

In RMB Yuan

project Closing book value

House building 28,887,099.75

Machinery and equipment 79,721,126.69

The means of transport 130,766.74

Electronic equipment 2,175,815.79

Other equipment 614,515.86

A combined 111,529,324.83

(4) The fixed assets without the title certificate

In RMB Yuan

project The book valueThe reason why the title certificate is not

completed

Dalian tile shaft precision motor

automobile bearing workshop32,237,075.69

Property ownership certificate

procedures complete, in the process

Main plant of Liao Axle Company 6,446,920.14Comprehensive acceptance is being

handled for the record


97

Liao Axis Company office building 2,620,732.34Comprehensive acceptance is being


Liao axle driver processing workshop 1,166,835.07Comprehensive acceptance is being


Liao Axis company staff canteen 805,672.21Comprehensive acceptance is being


22.Construction in progress

In RMB Yuan

project The ending balance Beginning balance


A combined 24,348,551.06 24,254,985.16

(1) Construction in progress

In RMB Yuan

Item

The ending balance Beginning balance

Book

balance

Impairment

lossThe book value Book balance

Impairment

lossThe book value

Qi finished

products

transform

4,434,526.90 3,468,712.79 965,814.11 5,294,384.87 3,468,712.79 1,825,672.08

Precision bearing

factory

transformation

3,741,698.76 3,741,698.76 4,221,142.02 4,221,142.02

Factory

renovation Project826,926.61 826,926.61 1,659,638.56 1,659,638.56

Railway

reconstruction489,555.58 489,555.58 1,758,204.72 1,758,204.72

Precision rolling

body

transformation

0.00 0.00 1,189,745.29 1,189,745.29

Dalian Industrial

Park Project5,590.46 5,590.46 1,822,184.00 1,822,184.00

Grinding

production line38,957.26 38,957.26 1,774,704.65 1,774,704.65

Super precision

machine

installation project

297,546.02 297,546.02 540,528.68 540,528.68

Large scale

renovation project7,597,921.08 7,597,921.08 1,635,330.51 1,635,330.51

Grinding machine 169.19 169.19 376,403.13 376,403.13


98

modification

The crane project 255,382.52 255,382.52 255,382.52 255,382.52

Computer

engineering184,075.24 184,075.24 184,075.24 184,075.24

Secondary

finished product

modification

265,486.74 265,486.74

Overhaul branch

factory

transformation

141,423.05 141,423.05 176,772.70 176,772.70

Channel 2

construction

project

259,161.89 259,161.89

other 9,538,004.44 9,538,004.44 6,576,039.17 6,576,039.17

A combined27,817,263.8

53,468,712.79 24,348,551.06 27,723,697.95 3,468,712.79 24,254,985.16

(2) Changes of important construction projects under construction in this period

In RMB Yuan


99

The project name Budget numberBeginning

balance

Current

increase

Amount of

fixed assets

transferred in

the current

period

Other

reduced

amounts in

the current

period

The ending

balance

Proportion of

cumulative

project

investment in

budget

Progress

of the

project

Accumulated

capitalization

of interest

Among them:

the amount of

capitalization of

current interest

Capitalizati

on rate of

current

interest

Sources

of

funding

Railway

reconstruction14,472,691.67 1,758,204.72 247,787.60 828,162.03 23,076.92 1,154,753.37 97.75% 97.75 90,837.36 other

Qi finished products

transform107,106,101.50 5,294,384.87 859,857.97 4,434,526.90 53.92% 53.92 656,478.24 other

Precision rolling

body transformation27,209,771.00 1,189,745.29 831,809.07 357,936.22 51.21% 51.21 1,203,099.87 other

Precision bearing

factory

transformation

5,500,815.00 4,221,142.02 498,230.08 243,870.45 4,475,501.65 91.43% 91.43 other

Dalian Industrial

Park Project39,164,803.61 1,822,184.00 1,816,593.54 5,590.46 21.04% 21.04 35,839.06 other

Car modification 2,302,350.00 77.91% 77.91 435.23 other

Overhaul branch

factory

transformation

2,513,380.00 176,772.70 102,477.88 23,076.92 51,217.90 18.80% 18.8 204.04 other

Large scale

renovation project8,493,800.00 1,635,330.51

6,852,230.

08653,275.87 7,834,284.72 92.23% 92.23 33,034.11 other

total 206,763,712.7816,097,764.1

1

7,598,247.

765,336,046.81 46,153.84 18,313,811.22 -- -- 2,019,927.91 --


100

23. Productive biological assets

24. Oil and gas assets


25. Right to use assets

In RMB Yuan

project House lease total

1. Opening balance 1,256,680.47 1,256,680.47

4. Ending balance 1,256,680.47 1,256,680.47

2. Increase in the current period 246,838.56 246,838.56

(1) Withdrawal 246,838.56 246,838.56

1. Closing book value 1,009,841.91 1,009,841.91

2. Starting book value 1,256,680.47 1,256,680.47

26. Intangible assets

(1) Intangible assets

Item Land use right patent right Non-patented technology total

I.the original book value

1. Opening balance 126,235,427.10 6,553,383.89 132,788,810.99


period

(1) Purchase

(2) Internal research and

development

(3) Increased business

mergers


current period

(1) Disposal

4. Ending balance 126,235,427.10 6,553,383.89 132,788,810.99

II. cumulative amortization

1. Opening balance 45,647,605.97 6,415,343.84 52,062,949.81


period1,570,332.68 35,601.78 1,605,934.46

(1) Withdrawal 1,570,332.68 35,601.78 1,605,934.46


current period

(1) Disposal

4. Ending balance 47,217,938.65 6,450,945.62 53,668,884.27


101

III.Provision for impairment

1. Opening balance


period

(1) Withdrawal


current period

(1) Disposal

4. Ending balance

Iv. Book value 79,017,488.45 102,438.27 79,119,926.72

1. Closing book value 79,017,488.45 102,438.27 79,119,926.72

2. Starting book value 80,587,821.13 138,040.05 80,725,861.18

27. Development expenditure

28, goodwill

29. Long-term deferred expenses

In RMB Yuan

projectBeginning

balance

Current

increase

Amortized amount

of the current

period

Other reduced

amount

The ending

balance

Shanghai agency housing

ownership237,346.08 33,915.18 203,430.90

Amortization of floor

coating and maintenance

for the first and second

joint factory building in

new Industrial District of

WaAxis Group

152,329.88 76,164.96 76,164.92

Amortization of heating

overhaul costs79,128.33 27,927.90 51,200.43

Amortization of housing

decoration expenses42,383.82 36,328.80 6,055.02

A combined 511,188.11 174,336.84 336,851.27

30.Deferred income tax assets/deferred income tax liabilities

(1) Non-offset deferred tax assets

(2) non-offset deferred income tax liabilities

In RMB Yuan

projectClosing balance Opening balance

Taxable temporary Deferred tax liabilities Taxable temporary Deferred tax liabilities


102

differences differences

Non - identical control

enterprise assets

valuation value

4,896,322.33 734,448.35 4,896,322.33 734,448.35

A combined 4,896,322.33 734,448.35 4,896,322.33 734,448.35

(3) Deferred income tax assets or liabilities shown on a net basis after offset

In RMB Yuan

project

Deferred tax assets and

liabilities at the end of

the balance

The ending balance of

a deferred tax asset or

liability after offset

The amount of

deferred tax assets and

liabilities offset at the

beginning of the period

The beginning balance

of a deferred tax asset

or liability after offset


(4) Deferred income tax asset details are not recognized

In RMB Yuan


Temporary differences can be deducted 54,337,700.26 54,337,700.26

Deductible losses 567,068,741.45 567,068,741.45

A combined 621,406,441.71 621,406,441.71

(5) Deductible losses on unrecognized deferred tax assets are due in the following years

In RMB Yuan

year Closing balance Opening balance note

2021 36,394,255.27 36,394,255.27

2022 77,265,795.85 77,265,795.85

2023 106,335,303.14 106,335,303.14

2024 100,239,007.68 100,239,007.68

2025 246,834,379.51

total 567,068,741.45 320,234,361.94 --

31. Other non-current assets

32.Short-term borrowing

(1) Classification of short-term loans

In RMB Yuan


Credit borrowing 698,000,000.00 670,000,000.00

A combined 698,000,000.00 670,000,000.00

33.Transactional financial liabilities

34. Derivative financial liabilities

In RMB Yuan


103

species Closing balance Opening balance


Bank acceptance 67,284,800.00 151,086,735.65

A combined 226,793,257.05 274,654,535.65

Accounts payable

(1) List of accounts payable

In RMB Yuan


Payment for goods 1,242,788,565.21 982,917,948.65

The payment 26,097,105.76 24,620,842.88

other 10,519,054.02 37,263,105.32

A combined 1,279,404,724.99 1,044,801,896.85

(2) Significant accounts payable that are more than one year old

In RMB Yuan

project Closing balance Cause of outstanding or carry-over

project Cause of outstanding or carry-over

Liaocheng Dongchangfu Yuanrun

Bearing Accessories Co., LTD6,682,770.67 Outstanding settlement

Liaocheng Hengfeng Rolling bearing

Co., LTD2,348,706.85 Outstanding settlement

Liaocheng Dongheng Bearing parts

Factory1,295,289.30 Outstanding settlement

Taiwan Oil machine Industry Co., LTD 1,188,227.37 Outstanding settlement

A combined 11,514,994.19 --

37.Advance payment

38. Contractual liabilities

In RMB Yuan


Contractual obligations pending

performance47,607,834.61 39,456,304.55

total 47,607,834.61 39,456,304.55

39.Pay staff salaries

(1) List of employee remuneration payable

In RMB Yuan


104

(2) Short-term compensation list

In RMB Yuan

project Beginning balance Increase in currentReduce in the current

periodClosing balance

1. Salary, bonus, allowance

and subsidy41,202,601.27 107,873,690.86 137,282,280.74 11,794,011.39

2. Employee welfare funds 55,153.00 10,471,538.52 10,457,278.02 69,413.50

3. Social insurance premiums 42,646.65 13,662,621.04 13,682,188.40 23,079.29

Among them: medical

insurance premium45,888.12 10,276,615.00 10,310,784.51 11,718.61

Injury insurance premium -1,109.31 2,110,986.99 2,109,581.65 296.03

Maternity insurance -2,132.16 1,275,019.05 1,261,822.24 11,064.65

4. Housing accumulation fund 2,487,488.49 11,854,750.94 11,864,579.94 2,477,659.49

5. Trade union funds and staff

education funds1,558,364.50 1,104,120.20 1,135,183.43 1,527,301.27

A combined 45,346,253.91 144,966,721.56 174,421,510.53 15,891,464.94

(3) Set up the listing of the escrow plan

In RMB Yuan



1. Basic endowment

insurance5,892,803.76 22,481,830.97 22,475,884.34 5,898,750.39

2. Unemployment

insurance premium80,629.42 704,039.41 722,326.91 62,341.92

A combined 5,973,433.18 23,185,870.38 23,198,211.25 5,961,092.31

40.Taxes payable

In RMB Yuan



1. Short-term

compensation45,346,253.91 144,966,721.56 174,421,510.53 15,891,464.94

2. Post-employment

benefits - Set up an

escrow plan

5,973,433.18 23,185,870.38 23,198,211.25 5,961,092.31

Three, dismiss welfare 1,357,454.00 1,357,454.00

A combined 52,677,141.09 168,152,591.94 198,977,175.78 21,852,557.25


105

project Closing balance Beginning balance

The VAT 2,183,316.03 1,576,813.19

Personal income tax 167,553.93 148,082.29

City maintenance and construction tax 212,728.27 208,938.78

The property tax 732,129.76 911,163.89

Land use tax 536,377.57 536,377.57

Stamp duty 419,685.91 160,352.41

Education surcharge 85,072.79 145,800.58

other 0.00 639.97

A combined 4,336,864.26 3,688,168.68

41. Other payable

In RMB Yuan


Interest payable 1,680,000.00 1,041,600.00

Other payable 144,788,203.79 128,434,461.47

total 146,468,203.79 129,476,061.47

(1) Interest payable

In RMB Yuan


Interest payable on short-term

borrowings1,680,000.00 1,041,600.00

total 1,680,000.00 1,041,600.00

(2) Dividends payable

(3) Other payables

1) List other payables according to their nature

In RMB Yuan


Bid bond 1,548,890.00 1,165,890.00

Group payables 40,182,304.11 41,606,986.87

Authorized Dealer security deposit 55,828,065.36 25,526,424.69

other 47,228,944.32 60,135,159.91

total 144,788,203.79 128,434,461.47

42.Hold liabilities for sale

43.Non-current liabilities due within one year

44. Other current liabilities

In RMB Yuan


106


To transfer tax 6,168,824.67 5,129,319.58

total 6,168,824.67 5,129,319.58

45. Long-term borrowing

46.Bonds payable

47.Lease liabilities

In RMB Yuan


Operating lease 1,281,492.96 1,256,680.47

total 1,281,492.96 1,256,680.47

48.Long-term payable

In RMB Yuan



Special payables 244,974.84 244,974.84

A combined 344,974.84 344,974.84

(1) List the long-term payable by the nature of the amount

In RMB Yuan


equipments 100,000.00 100,000.00

A combined 100,000.00 100,000.00

In RMB Yuan

projectBeginning

balance

Increase

in currentThe reduced

The ending

balanceReasons for the formation

Special

pollution

control

169,974.84 169,974.84

Wafangdian Finance Bureau and Wafangdian

Environmental Protection Bureau jointly

approved the allocation in the document

"Wacai Enterprises [2004] No. 217"

Information

construction75,000.00 75,000.00

Dalian Municipal Finance Bureau and Dalian

Municipal Economic and Information

Commission approved the appropriation with

the documents of "Dacai Refers to

Enterprises [2012]917" and "Dacai Letter Fa

[2012]199"

A combined 244,974.84 244,974.84 --

49.Long-term employee compensation payable

50.Estimated liabilities

In RMB Yuan


107

project Closing balance Opening balance Reasons for the formation

Product quality assurance 5,167,386.63 4,771,845.00Withholding compensation for product

quality

Wind power product quality

claim34,260,425.91 34,260,425.91

Product quality problems, the customer

claims compensation

A combined 39,427,812.54 39,032,270.91 --

51.Deferred revenue

In RMB Yuan

project Beginning balance Increase in current The reducedThe ending

balance

Reasons for the

formation

Government

subsidies33,380,301.70 2,405,641.07 30,974,660.63

Old factory

relocation

compensation

26,562,451.38 26,562,451.38

A combined 59,942,753.08 2,405,641.07 57,537,112.01 --

Projects involving government subsidies:

In RMB Yuan

liabilitiesBeginning

balance

The

amount

of

subsidy

added in

this

period

This period

is included

in the

amount of

non-operati

ng income

The amount

of other

income is

included in

the current

period

The

amount of

cost

write-dow

n in this

period

Other

chang

es

The ending

balance

Related to

assets/related

to earnings

Dalian branch

factory

demolition

compensation

21,633,886.42 1,352,117.94 20,281,768.48 Asset related

Bearing base

transformation

project of

high-end

equipment

manufacturing

industry

944,640.00 236,160.00 708,480.00 Asset related

Special

subsidies for

intelligent

manufacturing

5,155,555.56 644,444.42 4,511,111.14 Asset related


108

equipment

development

Large axle load

project discount

subsidy

1,180,000.00 120,000.00 1,060,000.00 Asset related

Industrial

development

fund

3,999,468.00 3,999,468.00 Asset related

Skill master

studio

construction

subsidy

423,349.65 52,918.71 370,430.94 Asset related

Master Liu

Changfu grants43,402.07 43,402.07 Asset related

total 33,380,301.70 2,405,641.07 30,974,660.63

52.Other non-current liabilities

53.equity

In RMB Yuan

Beginning

balance

This change increases or decreases (+, -)

Closing balanceIssuing

new

shares

Send sharesReserve fund

conversionother total

The total

number of

shares

402,600,000.00 402,600,000.00

54. Other equity instruments

55.Capital reserves

In RMB Yuan

project Beginning balance Increase in current The reduced Closing balance

Capital premium

(equity premium)201,956,446.52 201,956,446.52

Other capital reserves 283,734,603.95 283,734,603.95

A combined 485,691,050.47 485,691,050.47

56.Treasury stocks

57.Other comprehensive income

58.Special reserves

59.Surplus reserve

In RMB Yuan


109

project Beginning balance Increase in current The reduced Closing balance

Legal surplus reserve 116,179,772.10 116,179,772.10

Arbitrary surplus

reserves20,590,618.91 20,590,618.91

total 136,770,391.01 136,770,391.01

60.Undistributed profit

In RMB Yuan

project Current period Last period

Undistributed profit at the end of last period

before adjustment-211,056,473.59 201,379,956.97

Adjust the undistributed profit at the beginning

of the later period-211,056,473.59 201,379,956.97

Plus: net profit attributable to the owner of the

parent company for the period4,192,143.24 -380,228,430.56

Dividends payable on common Stock 32,208,000.00

Undistributed profit at the end of the period -206,864,330.35 -211,056,473.59

61.Operating revenue and operating costs

In RMB Yuan

projectCurrent amount Amount of previous period

income cost income cost

Main business 979,323,679.11 743,092,451.14 766,441,287.81 558,705,095.63

Other business 101,741,174.55 88,212,133.11 130,290,947.05 116,016,075.11

A combined 1,081,064,853.66 831,304,584.25 896,732,234.86 674,721,170.74

62.Taxes and surcharges

In RMB Yuan

project Current amount Amount of previous period

City maintenance and construction tax 2,353,667.48 2,107,839.21

Education surcharge 1,659,561.44 1,356,766.05

The property tax 1,317,733.83 1,911,888.83

Land use tax 1,229,139.16 1,170,320.16

Stamp duty 1,088,562.42 567,850.42

other 336,634.91 180,469.62

A combined 7,985,299.24 7,295,134.29

63.Selling expenses

In RMB Yuan


110

Item Current amount Amount of previous period

Domestic freight 12,349,704.71 11,375,376.65

Employee compensation 35,548,237.74 31,436,120.32

Business trip expenses 10,785,468.83 7,694,358.65

conference expense 211,566.96 64,503.82

Trademark royalty 6,109,435.99 13,202,226.80

The international freight 1,647,229.97 507,211.83

Other fees 12,248,118.36 11,333,374.26

total 78,899,762.56 75,613,172.33

64.Administrative costs

In RMB Yuan


Employee compensation 23,431,418.03 13,332,765.29

Amortization of intangible assets 2,230,355.60 2,199,753.74

Guard fee 1,058,384.10 2,870,491.92

Depreciation cost 932,823.09 729,725.04

Business entertainment 129,074.38 137,412.70

Business trip expenses 838,458.84 107,876.35

Other fees 17,224,711.27 19,794,786.49

total 45,845,225.31 39,172,811.53

65.Research and development costs

In RMB Yuan

Item Current amountAmount of previous

period

Artificial cost 3,438,538.95 3,866,670.00

Material input 69,160,362.26 74,265,649.79

Amortize depreciation expense against long-term expense 8,570,897.54 1,371,885.31

Technical service fee, design fee, new process procedure formulation fee

(equipment debugging fee - tooling for new products)14,932,890.82 3,991,033.25

Other fees 2,175,096.69 4,878,780.26

Total 98,277,786.26 88,374,018.61

66.Financial expenses

In RMB Yuan


Interest charges 14,013,998.99 15,282,652.60


111

Less: interest income 240,304.64 404,634.33

Add: exchange loss 1,842,959.48 -983,568.16

Other spending 5,699,002.65 3,130,781.01

total 21,315,656.48 17,025,231.12

67. Other benefits

In RMB Yuan

Other sources of revenue Current amount Amount of previous period

Dalian branch factory demolition

subsidy1,352,117.94 1,352,117.94

Stable post subsidy - Dalian

Employment Management Center17,811.01 1,223,302.21

Bearing base transformation project of

high-end equipment manufacturing

industry

236,160.00 236,160.00

Special subsidies for intelligent

manufacturing equipment development644,444.42 3,200,000.00

Large axle load project discount subsidy 120,000.00 120,000.00

Return of individual tax handling fee 32,813.61 11,381.57

Collect tile axis group union pioneer unit

bonus7,000.00

6296845157Electron withdrawing 2,316.58

Skill master studio construction subsidy 52,918.71

Dalian city group map organization

comprehensive service center awarded

Wu Qiong thesis award

5,000.00

First set (set) government subsidy 46,000.00

Subsidies for work in place of training 83,020.00

Open special funds 464,059.00

Municipal "double hundred plan" talent

research funds50,000.00

Total 3,063,661.27 6,192,961.72

68.Investment income

In RMB Yuan


Proceeds from debt restructuring 870,263.42 664,574.71

Total 870,263.42 664,574.71

69. Net exposure hedging gain


112

70.Fair value change earnings

In RMB Yuan

The source of fair value change income Current amount Amount of previous period

Trading financial assets 183,361.31 -55,470.65

Total 183,361.31 -55,470.65

71.Credit impairment losses

In RMB Yuan

item Current amount Amount of previous period

Loss on accounts receivable 30,000.00 7,311.38

Total 30,000.00 7,311.38

72.Asset impairment loss

73.Income from asset disposal

In RMB Yuan

Source of income from asset disposal Current amount Amount of previous period

Income from disposal of fixed assets 2,727,585.57 276,663.74

74.Non-operating income

In RMB Yuan


period

The amount booked into the

current non-recurring profit and

loss

Debt restructuring gains 0.00

Fine income 217,753.00 1,066,061.88 217,753.00

other 599,903.00 1,069,471.92 599,903.00

Total 817,656.00 2,135,533.80

75.Non-operating expenses

In RMB Yuan


period

The amount booked into the

current non-recurring profit and

loss

donating 80,000.00 0.00

Debt restructuring losses 0.00

Loss of non-current assets 879,472.48 102.41 879,472.48

A fine spending 52,330.77 22,250.00 52,330.77

Late payment fee 14.17 2,523.76 14.17

other 5,106.47 312.58 5,106.47

Total 936,923.89 105,188.75


113

76.Income tax expenses

(1) Income tax expense schedule

(2) Accounting profit and income tax expense adjustment process

In RMB Yuan

Item Current amount

Profit total 4,192,143.24

77. Other comprehensive income

See the notes for details.

78. Cash Flow Statement items

(1) Other cash received in connection with operating activities

In RMB Yuan


Interest income 76,788.52 40,898.52

Government subsidies 46,000.00 46,000.00

Come-and-go money 56,518,795.54 9,998,779.57

Return the deposit and petty cash 139,620.00 82,729.00

other 460,844.42 101,830.42

total 57,242,048.48 10,270,237.51

(2) Other cash paid in connection with operating activities

In RMB Yuan


Cost of sales 222,383.56 172,349.56

Management fees 54,265,462.19 52,648,257.50

Finance charges 135,210.90 133,224.90

other 21,865,294.56 18,305,149.56

total 76,488,351.21 71,258,981.52

(3) Other cash received in connection with investment activities

(4) Other cash paid in connection with investment activities

(5) Other cash received in connection with financing activities

In RMB Yuan


Bill discount 38,566,252.78 41,567,823.29

total 38,566,252.78 41,567,823.29

(6) Other cash disbursements in connection with financing activities

In RMB Yuan



114

The bill is payable at maturity 50,000,000.00 67,110,000.00

total 50,000,000.00 67,110,000.00

79. Supplementary information on cash flow Statement

(1) Supplementary information of cash flow statement

In RMB Yuan

Additional information Current amount Amount of previous period

1. -- --

Adjusting net profit to cash flow from operating activities: 4,192,143.24 3,647,082.19

Net profit

Add: asset impairment provision 28,818,633.76 28,697,977.45

Depreciation of fixed assets, depreciation of oil and gas assets,

depreciation of productive biological assets

Depreciation of usufruct 2,230,355.60 2,199,753.74

Amortization of intangible assets 174,336.84 163,415.20

Amortization of long-term deferred expenses -2,727,585.57 -276,663.74

Loss on disposal of fixed assets, intangible assets and other long-term

assets (marked with "-" for income)820,370.34 102.41

Loss on scrap of fixed assets (marked with "-" for income) 183,361.31 55,470.65

Loss on change in fair value (marked with "-" for earnings) 21,315,656.48 17,025,231.12

Financial expenses (marked with "-" for income) -870,263.42 -664,574.71

Investment loss (marked with "-" for profit)

Reduction in deferred income tax assets (marked with "-" for increase)

Increase in deferred income tax liability (marked with "-" for decrease) -145,468,868.68 29,745,513.29

Decrease in inventory (increase marked with "-") -137,873,561.95 -117,979,875.19

Reduction of operating receivables (marked with "-" for increase) 260,607,765.54 109,907,994.64

Increase of operational payable items (marked with "-" for reduction)

other 31,402,343.49 72,521,427.05

Net cash flow from operating activities -- --

2.

Significant investment and financing activities that do not involve cash

receipts and expenditures:

Debt to capital

A convertible corporate bond that matures within one year -- --

Financial leasing of fixed assets 160,772,019.45 250,275,098.40

3. 127,620,944.91 137,324,488.53


115

Net change in cash and cash equivalents:

Ending balance of cash

Minus: opening balance of cash 33,151,074.54 112,950,609.87

(2) The net cash of the subsidiary paid in the current period

(3) Net cash received at the disposal of subsidiaries during the current period

(4) The composition of cash and cash equivalents

In RMB Yuan

Item Closing balance Opening balance

I. cash 160,772,019.45 127,620,944.91

Wherein: cash on hand 25,913.68 33,102.75

A bank deposit available for payment at

any time160,746,105.77 127,587,842.16

III.Ending balance of cash and cash

equivalents160,772,019.45 127,620,944.91

80.Comments on items of the statement of Changes in owners' equity

Description of the "other" items and the amount of adjustment to the balance at the end of the previous year:

81.An asset whose ownership or use is restricted

82.Foreign currency monetary items

(1) Foreign currency monetary items

In RMB Yuan

projectEnding foreign currency

balanceDiscount rate

The balance converted into

RMB at the end of the period

Monetary fund -- -- 75,392,452.33

Including: US dollars 11,121,250.17 6.37 70,822,345.33

The euro 588,809.91 7.76 4,570,107.00

Hong Kong dollars

Accounts receivable -- -- 26,504,894.73

Including: US dollars 3,396,902.34 6.37 21,632,153.48

The euro 627,801.13 7.76 4,872,741.25

Hong Kong dollars

Long-term borrowing -- --

Including: US dollars

The euro

Hong Kong dollars

Other accounts receivable

Among them: Euro 642,830.99 7.76 4,989,397.01


116

Accounts payable —— 242,995.51

Including: US dollars 21,136.91 6.37 134,604.07

The euro 13,965.09 7.76 108,391.44

Other payable —— 649,220.16

Including: US dollars 101,947.20 6.37 649,220.16

Other notes:

(2) Description of overseas business entities, including important overseas business entities, shall disclose their main overseas

business locations, functional currency and selection basis, and shall also disclose reasons for changes in functional currency.


83.hedging

The qualitative and quantitative information of the hedging item, relevant hedging instruments and hedged risks shall be disclosed

according to the hedging category:

84.Government subsidies

(1) Basic information on government subsidies

In RMB Yuan

species Account Presentation projectThe amount included in

current profit and loss

Return of individual tax handling fee 32,813.61 Other income 32,813.61

Steady post subsidies 17,811.01 Other income 17,811.01

Dalian branch factory demolition

subsidy48,676,244.95 Deferred revenue 1,352,117.94

Special subsidies for intelligent

manufacturing equipment

development

8,000,000.00 Deferred revenue 644,444.42

Open special funds 464,059.00 Other income 464,059.00

Bearing base transformation project

of high-end equipment manufacturing

industry

4,723,200.00 Deferred revenue 236,160.00

Collect tile axis group union pioneer

unit bonus7,000.00 Other income 7,000.00

Large axle load project discount

subsidy2,400,000.00 Deferred revenue 120,000.00

6296845157 Electronic revocation 2,316.58 2,316.58

First set (set) government subsidy 46,000.00 Other income 46,000.00

Skill master studio construction

subsidy700,000.00 Deferred revenue 52,918.71

Dalian city group map organization

comprehensive service center5,000.00 Other income 5,000.00


117

awarded wu Qiong thesis award

Receive the subsidy for labor and

training from January to March 202183,020.00 Other income 83,020.00

Industrial development fund 4,877,400.00 Deferred revenue

A combined 70,034,865.15 —— 3,063,661.27

(2) The return of government subsidies


Other notes:

85.other

VIII. Change of merger scope

IX.Rights and interests in other subjects

1. Interests in subsidiaries

(1) Composition of enterprise groups

The name of

the subsidiary

Main business

arearegistered

Nature of the

business

stakeMake way

direct indirect

Wazhou

liaoyang

bearing

manufacturing

co., LTD

Liao Yang

province

61 Weiguo

Road, Baita

District,

Liaoyang City

Production and

sales of

bearings and

machinery

manufacturing

100.00%Enterprise

merger

Dalian wazhou

precision motor

car bearing co.,

LTD

Dalian

province

12 Yongsheng

Street, 13 Li,

Dalian Free

Trade Zone

Production and

sales of

bearings and

machinery

manufacturing

100.00% Set up

Wazhou

precision

spherical roller

bearings

(wafangdian)

co., LTD

Wafangdian

No.1, Section

1, North Gongji

Street,

Wafangdian

Production and

sales of

bearings and

machinery

manufacturing

100.00%Enterprise

merger

X.Risks associated with financial instruments

XI.Disclosure of fair value

XII. Related Parties and related Party transactions

Name of parent

companyregistered

Nature of the

business

The registered

capital

The parent

company's

shareholding ratio in

the company

The proportion of

voting rights of the

parent company

Wazhou groupNo.1, Section 1,

Beijiaxia Street,

Bearing and all kinds

of equipment519,869,400.00 60.61% 60.61%


118

Wafangdian city,

Dalian

manufacturing,

marketing

A description of the parent company of the enterprise

The final control party of the enterprise is the State-owned Assets Supervision and Administration Commission of Dalian

Municipal People's Government.

2. The company's subsidiaries

Please refer to Note IX. 1.(1) for details of the subsidiaries of the enterprise.

3. The situation of joint venture and joint venture

4. Other related Parties

Names of other affiliates Relationship between other related parties and the enterprise

Dalian Wafangdian Bearing Group Equipment Manufacturing

Co., Ltd.

Other enterprises controlled by the same controlling

shareholder and ultimate controlling party

Wafangdian Bearing Precision Ball Manufacturing Co., Ltd.Other enterprises controlled by the same controlling


Wafangdian Bearing Precision Forging Co., LtdOther enterprises controlled by the same controlling


Wafangdian Bearing Group Wind Power BearingCo., Ltd.Other enterprises controlled by the same controlling


Wafangdian Bearing GroupPrecision Drive Bearing Co., LTDOther enterprises controlled by the same controlling


Wafangdian bearing group equipment technology engineering

co., LTD



Wafangdian Bearing Special Precision Bearing Co., Ltd.Other enterprises controlled by the same controlling


Liaoning northern metal supply chain co., LTDOther enterprises controlled by the same controlling


Wafangdian Bearing Group (U.S.A.) Co., Ltd.Other enterprises controlled by the same controlling


Wafangdian bearing Group High-end Auto Bearing Co., Ltd.Other enterprises controlled by the same controlling


Wafangdian bearing group precision roller co., LTDOther enterprises controlled by the same controlling


Wafangdian Bearing Group Precision Retainer Co., Ltd.Other enterprises controlled by the same controlling


Germany Leipzig Roller and Ball Bearing Co., Ltd.Other enterprises controlled by the same controlling


Wafangdian Bearing Power Co., Ltd. Other enterprises controlled by the same controlling


119


Wafangdian Bearing Group Engineering Technology Research

Center



Wafangdian Bearing Power Co., Ltd. Other associated parties

Dalian Wazhou Jinzhou Machinery Co., Ltd. Other associated parties

Wafangdian Tongda Bearing Manufacturing Co., Ltd. Other associated parties

Dalian Wazhou Fengyuan Machinery Co., Ltd. Other associated parties

ZWZ Bearing Europe GmbH Other associated parties

5. Related Transactions

(1) Related party transactions of purchasing and selling goods, providing and accepting services

List of goods purchased/services received

In RMB Yuan

The affiliated partyContent of Related

TransactionsCurrent amount

Approved

trading quotas

Whether

it exceeds

the

trading

limit

Amount of

previous period

Wafangdian Bearing Precision

Forging Co., LtdBuy spare parts 110,950,488.47 450,000,000.00 no 91,230,285.11

Wafangdian bearing group precision

roller co., LTDBuy spare parts 16,802,062.64 60,000,000.00 no 12,953,553.77

Wazhou Group Precision Drive

Bearing Co., Ltd.

Buy

goods/servicesno 1,985,986.05

Wafangdian Tongda Bearing

Manufacturing Co., Ltd.

Buy

goods/services1,988.00 6,000,000.00 no 1,233,348.00

Dalian Wazhou Fengyuan Machinery

Co., Ltd.Buy parts/services 4,231,302.26 20,000,000.00 no 1,375,930.38

Wafangdian bearing Group High-end

Auto Bearing Co., Ltd.

The purchase of

goods63,713,344.65 170,000,000.00 no 37,322,321.95

Wafangdian Bearing Group Precision

Retainer Co., Ltd.Buy spare parts 66,106,128.36 150,000,000.00 no 30,752,307.46

Dalian Wazhou Jinzhou Machinery

Co., Ltd.Buy spare parts 5,445,226.09 25,000,000.00 no 3,820,940.51

Dalian Wafangdian Bearing Group

Equipment Manufacturing Co., Ltd.

Purchase parts,

products and

equipment

8,660,940.09 70,000,000.00 no 10,812,886.06

Wafangdian Bearing Group Wind

Power BearingCo., Ltd.

The purchase of

goods2,318,842.65 20,000,000.00 no

Wafangdian Bearing Power Co., Ltd. Purchase 18,358,528.43 54,700,000.00 no 9,520,730.75


120

commodity fuel

power, receive

service

Wafangdian Bearing Group

Engineering Technology Research

Center

Accepting labor

services,8,201,980.00 22,000,000.00 no 3,256,398.61

Wafangdian Bearing Group Co., Ltd.

Buy goods, spare

parts/receive

services

373,036,349.161,074,800,000.

00no 197,715,938.60

Germany Leipzig Roller and Ball

Bearing Co., Ltd.

Accepting labor

services,1,000,000.00 no 648,292.34

Total 677,827,180.81 402,628,919.59

Table of goods/services offered for sale

In RMB Yuan

Related party

Content of

Related

Transactions

Current amount Amount of previous period

Wafangdian Bearing Precision Forging Co., Ltd Sales of goods 43,265,124.64 36,492,655.84

Wafangdian Bearing Group Co., Ltd. Sales of goods 33,537,357.81 45,861,559.58

Wafangdian Bearing Group (U.S.A.) Co., Ltd. Sales of goods 33,296,028.83 32,507,453.55

Wazhou Group Precision Drive Bearing Co., Ltd. Sales of goods 131,524.04 1,004,977.15

Dalian Wafangdian Bearing Group Equipment

Manufacturing Co., Ltd.Sales of goods 72,236.78 33,777.71

Wafangdian Bearing Group Wind Power

BearingCo., Ltd.Sales of goods 11,228,246.56 76,473,270.03

Wafangdian Bearing Special Precision Bearing

Co., Ltd.Sales of goods 76,033.09 296,826.65

Dalian Wazhou Jinzhou Machinery Co., Ltd. Sales of goods 1,836.00

Wafangdian Tongda Bearing Manufacturing Co.,

Ltd.Sales of goods 382,488.01

Wafangdian bearing group precision roller co.,

LTDSales of goods 7,466,886.26 5,173,400.70

Wafangdian Bearing Group Precision Retainer Co.,

Ltd.Sales of goods 18,588.59 20,842.17

Wafangdian bearing Group High-end Auto Bearing

Co., Ltd.Sales of goods 2,186,163.12 5,565,981.26

Germany Leipzig Roller and Ball Bearing Co., Ltd. Sales of goods 4,032,732.79 2,874,449.64

Wazhou Group Precision Drive Bearing Co., Ltd.Provide labor

services20,252,715.83 709,423.96


121


Co., Ltd.

Provide labor

services490,622.69 337,459.98

Dalian Wazhou Jinzhou Machinery Co., Ltd.Provide labor

services149,419.98 52,160.67


Manufacturing Co., Ltd.

Provide labor

services147,589.92

Wafangdian Bearing Group Co., Ltd.Provide labor

services9,302,159.07 7,384,140.07

Wafangdian Bearing Precision Forging Co., LtdProvide labor

services484,596.79 181,495.35


LTD

Provide labor

services1,424,404.62 2,056,798.51

Wafangdian Bearing Group Precision Retainer Co.,

Ltd.

Provide labor

services73,816.39

Wafangdian bearing Group High-end Auto Bearing

Co., Ltd.

Provide labor

services2,410,301.24


Ltd.

Provide labor

services3,057,843.11

total

Content of

Related

Transactions

173,104,392.16 217,410,996.83

(2) Associated with entrusted management/contracting and entrusted management/outsourcing

(3) Associated lease

As the lessor, the Company:

In RMB Yuan

Name of the lesseeTypes of leased

assets本期确认的租赁收入上期确认的租赁收入

Wafangdian Bearing Precision Forging

Co., Ltdland 275,414.51 379,436.00


Retainer Co., Ltd.land 131,574.00 131,574.00

Wafangdian Bearing Group Co., Ltd. land 151,127.63 201,626.16

Wafangdian bearing Group High-end Auto

Bearing Co., Ltd.housing 1,668,492.60 3,089,922.60


Co., Ltdhousing 677,018.72 517,810.00

Dalian Wazhou Jinzhou Machinery Co.,

Ltd.housing 401,580.00 401,580.00

Wafangdian Bearing Group Precision housing 382,011.48 382,011.48


122

Retainer Co., Ltd.

Wafangdian Bearing Group Co., Ltd. housing 548,064.60 244,909.80

Dalian Wazhou Fengyuan Machinery Co.,

Ltd.housing 53,730.00 53,730.00


Bearing Co., Ltd.equipment 3,942,532.14 5,883,114.30

Wafangdian bearing group precision roller

co., LTDequipment 219,857.98 1,055,386.86


Retainer Co., Ltd.equipment 419,215.42 1,106,691.67

Wafangdian Bearing Group Co., Ltd. equipment 3,662,482.91 4,635,982.78

Total 12,533,101.99 18,083,775.65

The Company as the lessee:

In RMB Yuan

Name of the lessor Types of leased assetsRental fees confirmed for this

period

The rental fee confirmed in

the previous term

Wafangdian Bearing Group Co.,

Ltd.housing 105,844.50 105,844.50


Ltd.housing 1,400,277.61 1,330,299.06


Ltd.housing 1,169,652.00 584,826.00


Ltd.housing 1,285,835.52 1,285,835.51


Ltd.housing 391,860.00 391,860.00


Ltd.housing 1,129,680.00 1,354,155.00


Ltd.housing 345,541.00 430,657.76


Ltd.housing 34,401.00 56,367.50


Ltd.housing 584,826.00


Ltd.land 559,011.00 559,011.00


Ltd.land 250,180.75 237,657.00


123


Ltd.land 227,850.00 113,925.00


Ltd.land 263,025.00 263,025.00


Ltd.land 84,675.00 84,675.00


Ltd.land 224,475.00 473,776.01


Ltd.land 190,417.50 222,153.75


Ltd.land 113,925.00


Ltd.equipment 104,091.54 124,693.67


Ltd.equipment 179,660.54 168,695.33


Ltd.equipment 11,606.84 5,803.42


Ltd.equipment 484,361.04 483,945.55


Ltd.equipment 66,126.48 66,126.49

total 8,508,572.32 9,042,083.55

(4) Related guarantee

(5) Related party lending

(6) Assets transfer and debt restructuring of related parties

In RMB Yuan

Related partyContent of Related

TransactionsCurrent amount Last period amount

Dalian Wafangdian Bearing Group

Equipment Manufacturing Co., Ltd.

Proceeds from debt

restructuring18,030.00

Wafangdian bearing group equipment

technology engineering co., LTD

Proceeds from debt

restructuring3,885.00 22,650.00


Co., Ltd

Proceeds from debt

restructuring500,000.00

(7) Compensation of key management personnel

In RMB Yuan

item Current amount Last period amount


124

Pay in total 466,564.80 381,462.00

(8) Other related party transactions

6. Accounts receivable and payable by related Parties

(1) Receivable items

In RMB Yuan

The project

name Related party

Ending balance Opening balance

Book balance

Provisio

n for bad

debt

Book balance

Provision

for bad

debt

Accounts

receivable


Bearing Co., Ltd.52,276,288.20 68,678,602.65

Accounts

receivableWafangdian Bearing Precision Forging Co., Ltd 219,872.47 16,662,178.60

Accounts

receivable

Wafangdian Bearing Group Wind Power

BearingCo., Ltd.25,507,541.54 57,817,522.14

Accounts

receivable


LTD92,214,064.30 58,389,070.16

Accounts

receivableWafangdian Bearing Group (U.S.A.) Co., Ltd. 12,671,710.42 12,724,312.13

Accounts

receivable

Wafangdian Bearing Group Precision Retainer

Co., Ltd.7,604,387.25 4,695,277.43

Accounts

receivableWafangdian Bearing Group Co., Ltd. 124,093,657.21 45,948,737.23

Accounts

receivableWazhou Group Precision Drive Bearing Co., Ltd. 35,886,333.50 13,380,098.00

Accounts

receivable


Co., Ltd.313,460.12 96,675.89

Accounts

receivable

Germany Leipzig Roller and Ball Bearing Co.,

Ltd.2,093,164.98 951,712.17

Accounts

receivable


Ltd.2,776,919.75 246,225.41

Accounts

receivableZWZBearingEuropeGmbH 165,782.22

Accounts

receivableDalian Wazhou Jinzhou Machinery Co., Ltd. 1,769,628.29 534,568.97

Accounts

receivable

Wafangdian Bearing Group Engineering

Technology Research Center

Accounts

receivable

Wafangdian HongdaConstant velocity universal

jointManufacturing Company Limited148,466.32 148,466.32


125

Advance

paymentWafangdian Bearing Power Co., Ltd. 180,000.00

Advance

payment


Manufacturing Co., Ltd.12,670.00

Advance

payment


LTD239,733.27 3,157,266.38

Advance

paymentWafangdian Bearing Group Co., Ltd. 674,220.86

Advance

payment


Bearing Co., Ltd.8,019,600.29

Advance

paymentWafangdian Bearing Precision Forging Co., Ltd 36,765,177.51

Other

accounts

receivable

Wafangdian Bearing Group Co., Ltd.Lanzhou

Sales Branch778,950.65 778,950.65

Other

accounts

receivable

Lanzhou Sales Branch 20,254.45 20,254.45

(2) Items payable

In RMB Yuan

The project

nameRelated party Closing book balance Starting book balance

Accounts

payableWafangdian Bearing Precision Forging Co., Ltd 28,439,720.54 11,011,062.39

Accounts

payable瓦轴集团 228,159,410.99 115,348,014.25

Accounts

payable


Manufacturing Co., Ltd.4,001,795.63 2,664,211.48

Accounts

payable

Wafangdian bearing Group High-end Auto Bearing Co.,

Ltd.24,746,134.91 17,774,754.01

Accounts

payableWafangdian Tongda Bearing Manufacturing Co., Ltd. 3,077,828.88 846,928.89

Accounts

payable

Wafangdian bearing group equipment technology

engineering co., LTD29,700.00 29,700.00

Accounts

payableDalian Wazhou Jinzhou Machinery Co., Ltd. 3,908,628.15 2,388,530.75

Accounts

payableDalian Wazhou Fengyuan Machinery Co., Ltd. 4,582,504.87 1,247,725.38

Accounts Wafangdian Bearing Group Engineering Technology 8,040,683.38 4,453,686.53


126

payable Research Center

Accounts

payableWafangdian bearing group precision roller co., LTD 6,099,542.54 2,391,436.65

Accounts

payableWafangdian Bearing Group Precision Retainer Co., Ltd. 19,381,041.28 6,147,681.16

Accounts

payableWafangdian Bearing Power Co., Ltd. 1,823,009.04 1,012,371.15

Accounts

payableWazhou Group Precision Drive Bearing Co., Ltd. 1,367,702.05 682,054.80

Accounts

payableWafangdian Bearing Special Precision Bearing Co., Ltd. 965,878.64

Other payable Wafangdian Bearing Group Co., Ltd. 40,182,304.11 38,476,586.58

Other payableWafangdian bearing group equipment technology

engineering co., LTD5,662,503.19 952,000.00

Other payableDalian Wafangdian Bearing Group Equipment

Manufacturing Co., Ltd.211,088.45

7. Commitment of related Party

8.other

XIII. Share payment

1. The general situation of share payment


2. Share payments settled with equity

□Applicable √ Not applicable

3. Share payments settled in cash


4. Modification and termination of share payment

5.other

XIV.Commitments and contingencies

1. Important commitments

Significant commitments existing at balance sheet date

2. Contingencies

XV.Events after the balance sheet date

XVI.Other important matters

XVII.Annotation of major items in the parent company's financial statements

1. Accounts receivable

(1) Classified disclosure of accounts receivable

In RMB Yuan

category ending balance Beginning balance

Book balance Provision for bad The Book balance Provision for bad The book


127

debt book

value

debt value

account ratio accountProvisio

n ratioaccount ratio account

Provisi

on ratio

Accounts

receivable with

bad debt provision

drawn on a single

item

63,407,86

5.85

5.52

%

63,407,

865.85

100.00

%

63,437,

865.856.00%

63,437,

865.85

100.00

%

Among them:

Accounts

receivable with a

combination of

bad debt

provisions

1,084,436,

108.35

94.48

%

28,386,

695.632.62%

1,056,0

49,412.

72

1,079,5

92,293.

76

94.00%28,394,

940.133.00%

1,051,19

7,353.63

Among them:

Wherein: aging

combination

787,893,0

23.63

68.64

%

28,386,

695.633.60%

759,50

6,328.0

0

722,78

5,069.5

6

63.00%28,394,

940.134.00%

694,390,

129.43

Where:

combination of

related parties

296,543,0

84.72

25.83

%0.00%

296,54

3,084.7

2

356,80

7,224.2

0

31.00% 0.00%356,807,

224.20

A combined1,147,843,

974.20

100.0

0%

91,794,

561.488.00%

1,056,0

49,412.

72

1,143,0

30,159.

61

100.00

%

91,832,

805.988.00%

1,051,19

7,353.63

Provision for bad debt by single item: 63,407,865.85

In RMB Yuan

名称

Closing balance

Book balanceProvision forbad debt

Provision ratio Provision for

Liaoning Yinheng Galvanized Color CoatedSteel Plate Co. LTD

3,213,308.67 3,213,308.67 100.00%Not expected torecover

Shandong Hengji New Material Co., LTD 2,284,666.96 2,284,666.96 100.00%Not expected torecover

Shandong Yuanda Board IndustryTechnology Co., LTD

1,804,722.77 1,804,722.77 100.00%Not expected torecover

Hesteel Company Limited Handan branch 1,608,611.42 1,608,611.42 100.00%Not expected torecover

Angang Steel Company Limited 1,595,050.69 1,595,050.69 100.00%Not expected torecover

Liaoning Wa shaft Bearing Sales Co., LTD 1,500,000.00 1,500,000.00 100.00%Not expected torecover

Bazhou Tianli Pipe Co., LTD 1,325,600.76 1,325,600.76 100.00%Not expected torecover


128

Yingkou Iron & Steel Co. LTD 1,256,973.91 1,256,973.91 100.00%Not expected torecover

Sichuan Southwest Stainless Steel Co. LTD 1,241,333.17 1,241,333.17 100.00%Not expected torecover

Citic Heavy Industrial Machinery Co. LTD 1,137,600.00 1,137,600.00 100.00%Not expected torecover

Henan Taihang Vibration Machinery Co.,LTD

989,207.41 989,207.41 100.00%Not expected torecover

China second heavy machinery Group(Deyang) Wanxin engineering equipment


Benxi Beiying Iron & Steel (Group) Co.LTD


Bengang Steel Plates Co., Ltd 770,000.00 770,000.00 100.00%Not expected torecover

Materials Branch of North Heavy IndustryGroup Co. LTD


Shandong Yuntong New MaterialTechnology Co., LTD


Dongfeng Motor Transmission Co. LTD 704,098.23 704,098.23 100.00%Not expected torecover

Dalian Tianyuan Motor Co., LTD 666,383.31 666,383.31 100.00%Not expected torecover

Wolong Electric Huaian Qingjiang MotorCo., LTD


Qiqihar No.2 Machine Tool (Group) Co.LTD


Xi 'an Jossbo Hydraulic Engineering Co.LTD


Mudanjiang city speed reducer Factory 467,905.65 467,905.65 100.00%Not expected torecover

Hunan Chaoyang Electromechanical Co.,LTD


Xiangtan Motor Co., LTD 416,549.65 416,549.65 100.00%Not expected torecover

Xuzhou XCMG Material Supply Co., LTD 373,237.55 373,237.55 100.00%Not expected torecover

Qingdao Double star Tyre Industry Co., LTD 371,251.58 371,251.58 100.00%Not expected torecover

Minmetals Yingkou Plate Co. LTD 365,064.61 365,064.61 100.00%Not expected torecover

Shandong Kerui Steel Plate Co. LTD 357,290.00 357,290.00 100.00%Not expected torecover

Guangzhou Supplies section of ChinaRailway Guangzhou Bureau Group Co., LTD


Shantui Construction Machinery Co., Ltd. 325,867.86 325,867.86 100.00%Not expected torecover

Shandong tancheng new Asia light industrymachinery limited company


Beiman Special Steel Co. LTD of Northeast 315,004.72 315,004.72 100.00% Not expected to


129

Special Steel Group recover

Taicang Hutai Chang 'e PapermakingEquipment Co. LTD


Panzhihua Group Chengdu Iron & Steel Co.LTD


Harbin Haoke Electric Power TechnologyCo. LTD


Jiangsu Xinrui Gear System Co., LTD 286,949.88 286,949.88 100.00%Not expected torecover

Erzhong Group (Deyang) JinghengTransmission Equipment Co., LTD


Xingtai Iron & Steel Co. LTD 285,834.67 285,834.67 100.00%Not expected torecover

Shandong Guanpeng Metal Sheet Co., LTD 273,748.84 273,748.84 100.00%Not expected torecover

Baoji Loyalty Machine Tool Co., LTD 269,908.74 269,908.74 100.00%Not expected torecover

Jiangsu Dazhong Electric Co., LTD 257,662.90 257,662.90 100.00%Not expected torecover

Korla railway supplies section 256,044.10 256,044.10 100.00%Not expected torecover

Zhuzhou Gear Co., LTD 254,604.07 254,604.07 100.00%Not expected torecover

Jiamusi Electric Motor Co., LTD 245,000.00 245,000.00 100.00%Not expected torecover

Zibo Boshan Qianjin reducer Factory Co.,LTD


Indonesia CV.SIDO Company 243,676.52 243,676.52 100.00%Not expected torecover

Tonghua Iron & Steel Co. LTD 240,568.39 240,568.39 100.00%Not expected torecover

Shijiazhuang Qiangda slurry pump Co. LTD 238,749.98 238,749.98 100.00%Not expected torecover

Ningbo Fan Co., LTD 238,487.84 238,487.84 100.00%Not expected torecover

Shenyang Jingxin Remanufacturing Co.,LTD


Siemens Motors (China) Co., LTD 228,831.20 228,831.20 100.00%Not expected torecover

Anshan Heavy Duty Mining Machinery Co.,Ltd.


Heavy coal Machine Co. LTD 215,142.12 215,142.12 100.00%Not expected torecover

Qinhuangdao Shouqin Metal Material Co.,LTD


Liaoning Renda Equipment Technology Co.,LTD


CRRC Shenyang Locomotive & Rollingstock Co. LTD



130

Chengdu sales center (Panzhihua steel groupPanzhihua vanadium


Tianjin Rongtai New composite MaterialCo., LTD


Hangzhou Qianjin Gear Box Group Co.,LTD


Hebei Wenfeng Iron & Steel Co. LTD 197,979.65 197,979.65 100.00%Not expected torecover

Hubei WaAxis Xin Sheng Technology Co.,LTD


Nanjing Light Industrial Machinery Factory 185,079.54 185,079.54 100.00%Not expected torecover

Gulf World Trading Corporation of India 179,376.85 179,376.85 100.00%Not expected torecover

Huaibei Mining (group) coal industryLimited liability company materials branch


Jiamusi Coal Mine Machinery Co. LTD 171,288.78 171,288.78 100.00%Not expected torecover

Xuzhou Sinoma Equipment HeavyMachinery Co. LTD


Changsha Motor Factory Co. LTD 170,295.76 170,295.76 100.00%Not expected torecover

Austria Andritz Technology Co., LTD.(Foshan)


Xuzhou Meici Bridge Co., LTD 163,037.45 163,037.45 100.00%Not expected torecover

Foshan Ketai Electromechanical Co., LTD 160,772.79 160,772.79 100.00%Not expected torecover

Siping blower Co., LTD 160,053.21 160,053.21 100.00%Not expected torecover

Shenhua Materials Group Co. LTD 155,115.29 155,115.29 100.00%Not expected torecover

Hubei All-out Machinery Group Co. LTD 152,489.82 152,489.82 100.00%Not expected torecover

Guangdong Zhaoqing Jialong PackagingMachinery Group Co. LTD


Wuxi Yutong Bearing Co., LTD 149,427.42 149,427.42 100.00%Not expected torecover

Zhejiang Tongli Heavy MachineryManufacturing Co., LTD


China First Heavy Industry Group Co. LTD 132,135.01 132,135.01 100.00%Not expected torecover

Kunming Electric Machinery Factory Co.LTD


Guilin Hongcheng Mining equipmentManufacturing Co. LTD


Guangxi Beibu Gulf New Material Co., LTD 126,353.69 126,353.69 100.00%Not expected torecover

Shenyang Qunding Machinery Equipment 126,286.35 126,286.35 100.00% Not expected to


131

Co., LTD recover

Shenyang Machine Tool (Group) Co., LTD.Precision CNC Machine Tool Branch


Taiyuan Heavy Industry Co. LTD 121,560.19 121,560.19 100.00%Not expected torecover

Zhejiang RIFAPrecision Machinery Co.,Ltd. 120,214.46 120,214.46 100.00%Not expected torecover

China Railway Materials ShenyangCompany


Wuxi Computer Numerical Control Co.,LTD


John Deere Jia Lian harvesting MachineryCo. LTD


Orient Iron & Steel Co. LTD 108,997.44 108,997.44 100.00%Not expected torecover

Yingkou Jia Chen Burning chemical Co.,LTD


China Pingcoal what energy chemical groupLimited liability company


DBI Corporation of America 102,568.64 102,568.64 100.00%Not expected torecover

Changchun Power Generation EquipmentCo. LTD


Other individual provisions 23,143,246.01 23,143,246.01 100.00%Not expected torecover

Total 63,407,865.85 63,407,865.85 -- --

Withdrawal of bad debt provision by single item:

In RMB Yuan

nameClosing balance

Book balance Provision for bad debt Provision ratio Provision for

Bad debt provision by combination: 28,386,695.63

In RMB Yuan

nameClosing balance

Book balance Provision for bad debt Provision ratio

Aging combination 787,893,023.63 28,386,695.63 3.60%

Total 787,893,023.63 28,386,695.63 --

In RMB Yuan

nameClosing balance


Combination of related

parties215,054,691.15

Total 215,054,691.15 --

Instructions for determining the basis of the combination:


132

Bad debt provision shall be drawn by combination:

In RMB Yuan

nameClosing balance


Instructions for determining the basis of the combination:

If the accounts receivable bad debt provision is drawn according to the general model of expected credit loss, please refer to other

receivables disclosure methods to disclose the relevant information of bad debt provision:


Accounts receivable with bad debt provisions drawn according to the combination of credit risk characteristics shall be disclosed

according to the aging method

In RMB Yuan

aging Closing balance


1 to 2 years 55,372,323.03

2 to 3 years 21,376,208.30


3 to 4 years 15,866,683.20

4 to 5 years 25,358,615.62


Total 1,147,843,974.20

(2) Bad debt provisions drawn, collected or transferred back in the current period


In RMB Yuan

categoryBeginning

balance

Current change amountThe ending

balanceprovisionwithdraw or

reverse

Cancel after

verificationother

Single

provision30,000.00 30,000.00

Total 30,000.00 30,000.00

(3) accounts receivable actually written off in the current period

(4) The top five accounts receivable according to the ending balance collected by the debtor

In RMB Yuan

NameEnding balance of

accounts receivable

The proportion of

total ending balance

of accounts

receivable

Ending balance of allowance

for bad debts


LTD62,089,346.19 5.41%


133


Bearing Co., Ltd.42,596,744.51 3.71%

Taiyuan Material Supply Section of Daqin

Railway Co., LTD32,769,278.70 2.85% 308,227.58

Dalian wazhou precision motor car bearing co.,

LTD49,150,353.29 4.28%

Hebei Donghai Special Steel Group Co. LTD 21,503,960.05 1.87% 118,539.60

total 208,109,682.74 18.12%

2. Other receivables

In RMB Yuan

item Closing balance Opening balance


total 345,885,690.52 13,357,080.42

(1) Interest receivable

(2) Dividends receivable

(3) Other accounts receivable

1) Classification of other receivables by nature

In RMB Yuan

Nature of money Closing book balance Starting book balance

margin 4,579,516.02 6,913,207.78

The deposit 73,869.00 381,780.42

Personal cash 15,721.00 120,512.99

electricity 4,249,167.35 4,895,063.88

Other payments 336,967,417.15 7,024,289.13

total 345,885,690.52 19,334,854.20

2) Provision for bad debts

In RMB Yuan

Provision for bad debt

The first stage The second stage The third stage

TotalExpected credit

losses over the next

12 months


the entire duration (no

credit impairment occurs)


the entire duration (credit

impairment incurred)

Balance as of January

1, 20215,977,773.78 5,977,773.78

January 1, 2021

balance in current

period

—— —— —— ——

Balance on June 30, 5,977,773.78 5,977,773.78


134

2021

Loss provision Changes in current period significant changes in book balance


Disclosure by age

In RMB Yuan

aging Closing balance


1 to 2 years 515,227.91

2 to 3 years 545,368.17


3 to 4 years 226,230.23

4 to 5 years 151,112.17


Total 351,863,464.30

3) Bad debt provisions drawn, collected or transferred back in the current period


In RMB Yuan

category Opening

balance


balanceprovisionwithdraw or

reverse

Cancel after

verificationother

Other accounts

receivable bad

debt provision

5,977,773.78 5,977,773.78

Total 5,977,773.78 5,977,773.78

4) Other receivables in the top five of the closing balance collected by the debtor

In RMB Yuan

Name of the entityNature of

payment

Closing

balanceaging

The proportion of the

total closing balance

of other receivables

Ending

balance of

allowance for

bad debts

Liaoning Electric Power BureauPrepaid

electricity4,249,167.35

Within 1

year1.23%

Luoyang Zhongzhong casting

and forging Factory

Prepayment

for materials723,598.86

More than 5

years0.21% 723,598.86


LTD. Lanzhou Sales branch

Come-and-go

money768,264.15

Four to five

years0.22% 768,264.15

Handan Iron and Steel Group Co.

LTD

Come-and-go

money314,947.00

Within 1

year0.09% 314,947.00


135

Yingkou General Bearing

Manufacturing Co., LTD

Material

money490,288.89

More than 5

years0.14% 490,288.89

total -- 6,546,266.25 -- 1.89% 2,297,098.90


In RMB Yuan

item

Closing balance Opening balance

Book balanceImpairment

lossThe book value Book balance

Impairment

lossThe book value

Invest in

subsidiaries211,583,897.67 211,583,897.67 211,583,897.67 211,583,897.67

total 211,583,897.67 211,583,897.67 211,583,897.67 211,583,897.67

(1) Investment in subsidiaries

In RMB Yuan

Investee

Opening

balance(The

book value)

Increase or decrease in this periodClosing

balance(The

book value)

Ending

balance of

impairment

provision

Add

invest

ment

Reduce

investment

Provision

for

impairment

other

Wazhou liaoyang

bearing

manufacturing co.,

LTD

17,337,259.95 17,337,259.95

Dalian wazhou

precision motor car

bearing co., LTD

45,478,956.37 45,478,956.37

Wazhou precision

spherical roller

bearings

(wafangdian) co.,

LTD

148,767,681.3

5148,767,681.35

Total 211,583,897.67 211,583,897.67

4. Operating revenue and operating costs

In RMB Yuan

itemCurrent account Last period account

income cost income cost

Main business 1,109,372,674.86 920,204,788.55 776,299,724.04 573,014,937.70

other business 99,349,644.92 86,519,816.50 129,773,842.04 116,310,521.69

total 1,208,722,319.78 1,006,724,605.05 906,073,566.08 689,325,459.39

5. Investment income


136

In RMB Yuan

item Current account Last period account

Dividend income derived from other equity

instrument investments during the holding period18,821.12

Proceeds from debt restructuring 376,934.17

total 395,755.29

6.other

XVIII. Supplementary information

1. Current non-recurring profit and loss statement


In RMB Yuan

item account descriptions

Non-current asset disposal gains and losses -820,370.34

Government subsidies included in the current profits and losses

(closely related to the business of the enterprise, except the

government subsidies enjoyed in accordance with the national

unified standard quota or quantitative)

3,063,661.27

Debt restructuring gains and losses 312,267.65

In addition to the normal business of the company effective

hedging related business, tradable financial assets, derivative

financial assets, tradable financial liabilities, changes in the fair

value of the derivative financial liabilities to generate profits

and losses, as well as the disposal of tradable financial assets,

derivative financial assets, tradable financial liabilities,

derivative financial liabilities and other creditor's rights

investment returns

183,361.31

Non-operating income and expenses other than those

mentioned above701,102.45

Less: income tax impact 496,348.77

total 2,943,673.57 --

For the company according to the company information disclosure of securities for public issuance explanatory announcement no. 1

- non-recurring profit and loss "define non-recurring gains and losses as defined in the project, and put the company information

disclosure of securities for public issuance explanatory announcement no. 1 - non-recurring profit and loss of non-recurring profit

and loss items defined as listed in the current profits and losses of the project, should be the reasons why.


2. return on equity and earnings per share

Profit for reporting periodWeighted average return on

equity

Earnings per share

Basic Earnings per

share (YUAN/share)

Diluted Earnings per

Share (YUAN/share)


137

Net income attributable to the

company's common shareholders0.51% 0.010 0.010

Net income attributable to the common

shareholders of a company after

deducting non-recurring gains and

losses

0.15% 0.003 0.003

3. Differences in accounting data under domestic and foreign accounting standards

(1) Differences in net profits and net assets in financial reports disclosed in accordance with international accounting Standards and

Chinese accounting standards


(2) The difference between the net profit and net assets in the financial reports disclosed in accordance with the overseas accounting

standards and the Chinese accounting standards


(3) Explanation of reasons for differences in accounting data under domestic and foreign accounting standards. For the difference

adjustment of data audited by an overseas auditing institution, the name of the overseas auditing institution shall be indicated

4. other

2021 Midyear Report - static.cninfo.com.cn

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