688026: Guangzhou Jet Bio-Filtration Co.Ltd(688026) financial reports and audit reports for the last three years and financial reports for the latest period

catalogue

1、 Audit report Page 1-7 II. Financial statements Page 8-15

(I) consolidated and parent company's balance sheet Page 8-9

(II) consolidated and parent company's income statement Page 10

(III) consolidated and parent company cash flow statement Page 11

(IV) consolidated and statement of changes in owner's equity of the parent company Page 12-15 III. notes to financial statements Page 16-129

Audit report

TJS [2019] No. 7-465

Guangzhou Jet Bio-Filtration Co.Ltd(688026) all shareholders:

1、 Audit opinion

We have audited the financial statements of Guangzhou Jet Bio-Filtration Co.Ltd(688026) (hereinafter referred to as Guangzhou Jet Bio-Filtration Co.Ltd(688026) company), including the consolidated and parent company's balance sheets on December 31, 2016, December 31, 2017, December 31, 2018 and June 30, 2019, the consolidated and parent company's income statement, consolidated and parent company's cash flow statement for 2016, 2017, 2018 and January June 2019 Consolidated and parent company's statement of changes in owner's equity, and notes to relevant financial statements.

In our opinion, the attached financial statements are prepared in accordance with the provisions of the accounting standards for business enterprises in all material aspects and fairly reflect the consolidated and parent company's financial position of Guangzhou Jet Bio-Filtration Co.Ltd(688026) company on December 31, 2016, December 31, 2017, December 31, 2018 and June 30, 2019, as well as the financial position of 2016, 2017, 2018 Operating results and cash flow of the merger and parent company from January to June 2019.

2、 Basis for forming audit opinions

We conducted our audit in accordance with the auditing standards for Chinese certified public accountants. The "responsibilities of certified public accountants for the audit of financial statements" in the audit report further expounds our responsibilities under these standards. In accordance with the code of professional ethics for Chinese certified public accountants, we are independent of Guangzhou Jet Bio-Filtration Co.Ltd(688026) company and have fulfilled other responsibilities in terms of professional ethics. We believe that the audit evidence we have obtained is sufficient and appropriate, which provides a basis for our audit opinion.

Page 1 of 129

3、 Key audit matters

Key audit matters are the most important matters that we believe are the audit of the financial statements from January to June 2019, 2018 and 2017 according to our professional judgment. The response to these matters is based on the overall audit of the financial statements and the formation of audit opinions. We will not express separate opinions on these matters.

(1) Impairment of accounts receivable

1. Relevant fiscal year: January June 2019

(1) Item description

Relevant information disclosure is detailed in notes III (IX) 1 and V (I) 2 to the financial statements.

As of June 30, 2019, Guangzhou Jet Bio-Filtration Co.Ltd(688026) the book balance of accounts receivable of the company was RMB 57067387.30, the bad debt provision was RMB 3339523.77, and the book value was RMB 53727863.53.

Guangzhou Jet Bio-Filtration Co.Ltd(688026) the management of the company (hereinafter referred to as the management) measures its loss reserves according to the expected credit loss amount equivalent to the whole duration based on the credit risk characteristics of various accounts receivable and the combination of individual accounts receivable or accounts receivable. For accounts receivable whose expected credit loss is measured on a single basis, the management comprehensively considers the reasonable and reliable information about past events, current situation and future economic situation forecast, estimates the expected cash flow received, and determines the bad debt provision to be withdrawn accordingly; For the accounts receivable whose expected credit loss is measured on the basis of portfolio, the management divides the portfolio based on the aging, refers to the historical credit loss experience, and adjusts it according to the forward-looking estimation, and prepares the comparison table between the aging of accounts receivable and the expected credit loss rate, so as to determine the accrued bad debt reserves.

As the amount of accounts receivable is significant and the impairment of accounts receivable involves significant management judgment, we determine the impairment of accounts receivable as a key audit event.

(2) Audit response

For the impairment of accounts receivable, our audit procedures mainly include:

1) Understand the key internal controls related to the impairment of accounts receivable, evaluate the design of these controls, determine whether they have been implemented, and test the operation effectiveness of relevant internal controls;

2) Review the subsequent actual write off or reversal of accounts receivable for which bad debt reserves have been accrued in previous years, and evaluate the accuracy of previous forecasts of the management;

3) Review the relevant considerations and objective evidence of the management's credit risk assessment of accounts receivable. Evaluation page 2 of 129

Whether the management properly identifies the credit risk characteristics of various accounts receivable;

4) For accounts receivable that measure the expected credit loss on a single basis, obtain and check the management's prediction of the expected cash flow received, evaluate the rationality of the key assumptions used in the prediction and the accuracy of the data, and check with the obtained external evidence;

5) For accounts receivable whose expected credit loss is measured on the basis of portfolio, evaluate the rationality of the management's division of portfolio according to the characteristics of credit risk; Evaluate the rationality of the comparison table between the aging of accounts receivable and the expected credit loss rate prepared by the management according to the historical credit loss experience and forward-looking estimation of the combination with similar credit risk characteristics; Test the accuracy and completeness of the data used by the management (including accounts receivable aging, historical loss rate, migration rate, etc.) and whether the calculation of bad debt reserves is accurate;

6) Check the post period collection of accounts receivable and evaluate the rationality of the management's provision for bad debts of accounts receivable;

7) Implement letter verification procedures for important accounts receivable to verify the existence and accuracy of accounts receivable;

8) Check whether the information related to the impairment of accounts receivable has been properly presented and disclosed in the financial statements.

2. Relevant fiscal years: 2018 and 2017

(1) Item description

See notes III (x) and V (I) 2 to the financial statements for relevant information disclosure.

As of December 31, 2018, Guangzhou Jet Bio-Filtration Co.Ltd(688026) the book balance of accounts receivable of the company was RMB 70865192.85, the bad debt provision was RMB 4042501.75, and the book value was RMB 66822691.10; As of December 31, 2017, Guangzhou Jet Bio-Filtration Co.Ltd(688026) the book balance of accounts receivable of the company was RMB 52888770.55, the bad debt provision was RMB 3008159.15, and the book value was RMB 49880611.40.

For accounts receivable subject to impairment test separately, when there is objective evidence indicating impairment, the management shall comprehensively consider the debtor's industry status, operation status, financial status, repayment records and other factors, estimate the present value of future cash flow and determine the bad debt reserves to be accrued; For the accounts receivable that are subject to impairment test in combination, the management divides the combination according to the aging, industry status, overdue status and other basis, adjusts based on the historical loss rate of the combination with similar credit risk characteristics and combined with the actual situation, estimates the present value of future cash flow, and determines the bad debt reserves that should be withdrawn.

Page 3 of 129

As the amount of accounts receivable is significant and the impairment test of accounts receivable involves significant management judgment, we determine the impairment of accounts receivable as a key audit event.

(2) Audit response

For the impairment of accounts receivable, our audit procedures mainly include:

1) Understand the key internal controls related to the impairment of accounts receivable, evaluate the design of these controls, determine whether they have been implemented, and test the operation effectiveness of relevant internal controls;

2) Review the relevant considerations and objective evidence of the management's impairment test on accounts receivable, and evaluate whether the management has fully identified the accounts receivable that have been impaired;

3) For accounts receivable subject to separate impairment test, obtain and check the management's prediction of the present value of future cash flow, evaluate the rationality of key assumptions used in the prediction and the accuracy of data, and check with the obtained external evidence;

4) Evaluate the rationality of the management's classification of the combination according to the characteristics of credit risk for the accounts receivable that are tested for impairment by combination; Test the accuracy and completeness of the data used by the management (including checking the accuracy of accounts receivable aging by sampling for accounts receivable portfolio with aging as credit risk characteristics) and whether the calculation of the corresponding provision for bad debts is accurate;

5) Implement letter verification procedures for important accounts receivable to verify the existence and accuracy of accounts receivable;

6) Check the post period collection of accounts receivable and evaluate the rationality of the management's provision for bad debts of accounts receivable;

7) Check whether the information related to the impairment of accounts receivable has been properly presented and disclosed in the financial statements.

(2) Revenue recognition

Relevant fiscal years: January June 2019, 2018 and 2017

(1) Item description

See notes III (XXII) and V (Ⅱ) 1 to the financial statements for relevant information disclosure.

The operating revenue of Guangzhou Jet Bio-Filtration Co.Ltd(688026) company mainly comes from the production and sales of biological laboratory consumables products such as biological culture and liquid treatment. From January to June 2019, Guangzhou Jet Bio-Filtration Co.Ltd(688026) the company's operating revenue was RMB 94311458.00; In 2018, Guangzhou Jet Bio-Filtration Co.Ltd(688026) the company's operating revenue was 207479558.03 yuan; In 2017, Guangzhou Jet Bio-Filtration Co.Ltd(688026) the company's operating revenue was RMB page 4 of 129

167043100.22 yuan.

The domestic sales revenue of Guangzhou Jet Bio-Filtration Co.Ltd(688026) company is recognized when the products are delivered to the buyer and the receipt is confirmed, the amount of product sales revenue has been determined, the payment for goods has been recovered or the collection voucher has been obtained, and the relevant economic benefits are likely to flow in, and the cost related to the products can be measured reliably. The export revenue is recognized when the products are declared at customs and leave the port, the bill of lading is obtained, the amount of product sales revenue has been determined, the payment for goods has been recovered or the collection certificate has been obtained, and the relevant economic benefits are likely to flow in, and the cost related to the products can be measured reliably.

As operating revenue is one of the key performance indicators of Guangzhou Jet Bio-Filtration Co.Ltd(688026) company, there may be inherent risk that the management may achieve specific goals or expectations through improper revenue recognition. Therefore, we identified revenue recognition as a key audit matter.

(2) Audit response

For revenue recognition, our audit procedures mainly include:

1) Understand the key internal controls related to revenue recognition, evaluate the design of these controls, determine whether they are implemented, and test the operation effectiveness of relevant internal controls;

2) Check the main sales contracts, identify the terms related to the transfer of main risks and rewards of commodity ownership, and evaluate whether the revenue recognition policy is in line with the provisions of the accounting standards for business enterprises;

3) Implement substantive analysis procedures for operating revenue and gross profit margin on a monthly basis, products, customers, etc., identify whether there are significant or abnormal fluctuations, and find out the causes of fluctuations;

4) For domestic sales revenue, check the supporting documents related to revenue recognition by sampling, including sales orders, sales invoices, delivery lists, etc; For export revenue, obtain E-port Information and check with book records, and check sales orders, export customs declarations, freight bills of lading, sales invoices and other supporting documents by sampling;

5) Conduct on-site visit and verification on major customers, interview the cooperation between major customers and Guangzhou Jet Bio-Filtration Co.Ltd(688026) company, and obtain the transaction order data between major customers and Guangzhou Jet Bio-Filtration Co.Ltd(688026) company;

6) Combined with the letter of accounts receivable, the sales volume is confirmed to the main customers by sampling;

7) Check the operating income recognized before and after the balance sheet date to the delivery list, freight bill of lading and other supporting documents by sampling, and evaluate whether the operating income is recognized in an appropriate period;

8) Check whether the information related to operating income has been properly presented and disclosed in the financial statements. Page 5 of 129

4、 Responsibilities of management and governance for financial statements

The management is responsible for preparing the financial statements in accordance with the provisions of the accounting standards for business enterprises to achieve a fair reflection, and designing, implementing and maintaining necessary internal control so that the financial statements are free from material misstatement caused by fraud or error.

When preparing the financial statements, the management is responsible for evaluating the going concern ability of Guangzhou Jet Bio-Filtration Co.Ltd(688026) company, disclosing matters related to going concern (if applicable), and applying the going concern assumption, unless liquidation is planned, operation is terminated or there is no other realistic choice.

The Guangzhou Jet Bio-Filtration Co.Ltd(688026) corporate governance layer (hereinafter referred to as the governance layer) is responsible for supervising the financial reporting process of Guangzhou Jet Bio-Filtration Co.Ltd(688026) company.

5、 Responsibilities of certified public accountants for the audit of financial statements

Our goal is to obtain reasonable assurance on whether the financial statements as a whole are free from material misstatement due to fraud or error, and issue an audit report containing audit opinions. Reasonable assurance is a high-level assurance, but it does not guarantee that the audit performed in accordance with the audit standards will always be found when a major misstatement exists. Misstatement may be caused by fraud or error. If it is reasonably expected that the misstatement alone or in summary may affect the economic decisions made by the users of the financial statements based on the financial statements, the misstatement is generally considered to be significant.

In the process of carrying out the audit work in accordance with the audit standards, we use professional judgment and maintain professional doubt. At the same time, we also carry out the following work:

(1) Identify and assess the risks of material misstatement of financial statements due to fraud or error, design and implement audit procedures to deal with these risks, and obtain sufficient and appropriate audit evidence as the basis for issuing audit opinions. from

- Advertisment -