600063: audit report of Anhui wanwei Changsheng New Material Co., Ltd. (Rong Cheng Shen Zi [2022] No. 230z0022)
Anhui wanwei Hengsheng New Material Co., Ltd
Rong Cheng Shen Zi [2022] No. 230z0022
Rongcheng Certified Public Accountants (special general partnership)
Beijing, China
catalogue
Serial number content page number
1 audit report 1-5
2 balance sheet 6
3 income statement 7
4 cash flow statement 8
5 statement of changes in owner's equity 9-10
6 notes to financial statements 11-103
As operating revenue is one of the key performance indicators of wanwei Wansheng, there are inherent risks that it may operate revenue to achieve specific goals or expectations. Therefore, we identified revenue recognition as a key audit matter.
2. Audit response
Our relevant procedures for revenue recognition mainly include:
(1) Test the design and operation effectiveness of internal control related to revenue recognition;
(2) Select samples to spot check the main sales framework agreements, sales contracts and orders, check the main transaction terms, and evaluate whether the revenue recognition policy meets the requirements of the accounting standards for business enterprises;
(3) Implement substantive analysis procedures for changes in operating revenue and gross profit margin;
(4) Sample and inspect the sales contract / order, sales invoice, export declaration form, customer receipt, sales receipt and other supporting documents related to product sales revenue of wanwei Wansheng, and evaluate the authenticity of revenue recognition;
(5) Confirm the sales amount of the main customers, evaluate the authenticity and accuracy of revenue recognition, etc. (6) query the industrial and commercial data of the main customers, interview the main customers, understand their transaction background with the company, confirm whether they have a relationship with wanwei Wansheng, check the background information of the main customers and the transaction information of both parties, Pay attention to whether there are abnormal conditions;
(7) Perform the cut-off test, select samples from the revenue transactions recognized before and after the balance sheet date, check the sales contract, waybill, customer receipt and other materials, and confirm whether the revenue is recorded in the appropriate accounting period. (II) provision for bad debts of accounts receivable
1. Event description
See note III (9) and note V (3) of the financial statements for relevant information disclosure.
On December 31, 2021 and December 31, 2020, the book balance of accounts receivable of wanwei Changsheng was 107964049.02 yuan and 93674389.28 yuan respectively, and the bad debt reserves of accounts receivable were 5993162.77 yuan and 5580962.89 yuan respectively.
The determination of the ending value of accounts receivable requires the management to identify the items and objective evidence that have been impaired, evaluate the expected future available cash flow and determine its value, which involves the management to use major accounting estimates and judgments, and the provision for bad debts of accounts receivable is important to the financial statements. Therefore, we determine the provision for bad debts of accounts receivable as a key audit event.
2. Audit response
The relevant procedures implemented by us for bad debt provision of accounts receivable include:
(1) Evaluate and test the design and operation effectiveness of the company's internal control related to accounts receivable management;
(2) Analyze the rationality of the accounting estimation of the company's accounts receivable bad debt reserves, including the basis for determining the combination of accounts receivable, the judgment of significant amount, and the judgment of withdrawing bad debt reserves separately;
(3) Obtain the basis for the management to evaluate whether there is impairment of accounts receivable and confirm the expected loss rate, and evaluate the rationality of bad debt provision in combination with credit risk characteristics and aging analysis; Review and analyze the accounts receivable beyond the credit period, interview the management to understand the main customer information beyond the credit period, and review the rationality of the management's judgment by checking the historical collection, post period collection records and other relevant documents; (4) Confirm the current balance of major customers and evaluate the authenticity and integrity of accounts receivable confirmation;
(5) Query the industrial and commercial information of major customers, interview major customers and verify the background information of major customers;
(6) Retrieve the company's litigation information, conduct separate provision for bad debts test for customers involved in litigation, and evaluate whether there are signs of impairment in combination with the payment collection.
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 wanwei Wansheng, disclosing matters related to going concern and applying the going concern assumption, unless the management plans to liquidate wanwei Wansheng, terminate the operation or has no other realistic choice.
The governance layer is responsible for supervising the financial reporting process of wanwei Wansheng.
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 risk of material misstatement of financial statements due to fraud or error, design and implement
Implement audit procedures to deal with these risks and obtain sufficient and appropriate audit evidence as the basis for issuing audit opinions. Since fraud may involve collusion, forgery, intentional omission, misrepresentation or override of internal control, the risk of failing to find major misstatement caused by fraud is higher than that caused by error.
(2) Understand the internal control related to audit in order to design appropriate audit procedures, but the purpose is not to express an opinion on the effectiveness of internal control.
(3) Evaluate the appropriateness of accounting policies selected by the management and the rationality of accounting estimates and related disclosures.
(4) Draw conclusions on the appropriateness of management's use of going concern assumptions. At the same time, according to the audit evidence obtained, draw a conclusion on whether there are major uncertainties in the matters or circumstances that may lead to major doubts about wanwei Changsheng's going concern ability. If we conclude that there is significant uncertainty, the auditing standards require us to draw the attention of statement users to the relevant disclosures in the financial statements in the audit report; If the disclosure is insufficient, we should express a non unqualified opinion. Our conclusions are based on the information available as of the date of the audit report. However, future events or circumstances may lead to the inability of wanwei Changsheng to continue its business.
(5) Evaluate the overall presentation, structure and content of the financial statements, and evaluate whether the financial statements fairly reflect relevant transactions and events.
(6) Obtain sufficient and appropriate audit evidence on the financial information of wanwei Shengzhong entity or business activities to express an audit opinion on the financial statements. We are responsible for guiding, supervising and implementing the group audit, and take full responsibility for the audit opinions.
We communicated with the management on the planned audit scope, schedule and major audit findings, including the internal control defects that we identified in the audit.
We also provide a statement to the management that we have complied with the professional ethics requirements related to independence, and communicate with the management all relationships and other matters that may reasonably be considered to affect our independence, as well as relevant preventive measures.
From the matters communicated with the management, we determine which matters are the most important for the audit of the current financial statements, thus constituting key audit matters. Unless we are not sure that the disclosure of these matters in the audit report will cause negative consequences in the audit report under the circumstances that the disclosure of these matters exceeds the expected benefits in the audit report.
Anhui wanwei Hengsheng New Material Co., Ltd
Notes to financial statements
From 2020 to 2021
(unless otherwise specified, the monetary unit is RMB)
1、 Basic information of the company
Anhui wanwei Fusheng New Material Co., Ltd. (hereinafter referred to as the company or the company) was incorporated in Chaohu market supervision and Administration Bureau on May 8, 2015 with registration number of 340181000004670. It was jointly invested and established by Anhui wanwei Group Co., Ltd. and Zhejiang Fusheng Plastic Co., Ltd., with a registered capital of 120 million yuan. Among them, Anhui wanwei Group Co., Ltd. paid in 62 million yuan in monetary capital, and Zhejiang Changsheng Plastic Co., Ltd. paid in 48.54587 million yuan in housing, machinery and equipment and land use rights assessed in the asset appraisal report (Kyp [2015] No. 110) issued by Kyp Asset Appraisal Co., Ltd. (the benchmark date of appraisal is December 31, 2014), The remaining 9.45413 million yuan was paid in in monetary capital, and the total contribution of Zhejiang Changsheng Plastic Co., Ltd. was 58 million yuan. The equity structure of the company at the time of establishment is as follows:
No. name of shareholder subscribed capital contribution (10000 paid in capital contribution method subscribed capital contribution ratio) (10000 yuan) example (%)
1 Anhui wanwei Group Co., Ltd. 6200.00 6200.00 currency 51.67 Ren
2 Zhejiang Fusheng Plastic Co., Ltd. 5800.00 5800.00 in kind, land use right and currency
Total 12000.00 12000.00 12000.00 100.00
On June 14, 2016, the shareholders' meeting of the company made a resolution and agreed that Zhejiang Changsheng Plastic Co., Ltd. would transfer its 48.33% equity of the company to 24 natural persons such as Wang Bichang, Xie Lijuan and Shen Yajuan at the price of 58 million yuan, and signed an equity transfer agreement on June 28, 2016.
After this equity transfer, the equity structure of the company is as follows:
No. name of shareholder subscribed capital contribution (10000 paid in capital contribution method subscribed capital contribution ratio) (10000 yuan) example (%)
1 Anhui wanwei Group Co., Ltd. 6200.00 6200.00 currency 51.67 liability company
2 other natural person shareholders 5800.00 5800.00 currency 48.33
Total 12000.00-100.00
On April 2, 2020, the shareholders' meeting of the company made a resolution to agree Shen Yajuan, Xie Lijuan, Wang Yizhu, Shen Guohua, Shen Yifeng, Zhu huangeng, Huang Haiqin, Yu Xueting, Dai Lina, Tao Yuhong, Shen Ping, Wang Guiyou and Chen Sheng to transfer 13.9183% of the company's equity held by them to Anhui Anyuan innovation venture capital fund Co., Ltd. at a transfer price of 2.2 yuan per share, And signed the equity transfer agreement on April 3, 2020.
After this equity transfer, the equity structure of the company is as follows:
No. name of shareholder subscribed capital contribution (10000 paid in capital contribution method subscribed capital contribution ratio) (10000 yuan) example (%)
1 Anhui wanwei Group Co., Ltd. 6200.00 currency
