Securities code: Henan Liliang Diamond Co.Ltd(301071) securities abbreviation: Henan Liliang Diamond Co.Ltd(301071) Announcement No.: 2022007 Henan Liliang Diamond Co.Ltd(301071)
Announcement on changes in accounting policies of the company
The company and all members of the board of directors guarantee that the contents of the announcement are true, accurate and complete, and there are no false records, misleading statements or major omissions.
Henan Liliang Diamond Co.Ltd(301071) (hereinafter referred to as “the company”) held the 14th meeting of the second board of directors and the 10th meeting of the second board of supervisors on February 25, 2022, deliberated and adopted the proposal on the change of accounting policies of the company, which needs to be submitted to the 2021 annual general meeting of shareholders of the company for deliberation.
1、 Overview of changes in accounting policies
(I) reasons for changes in accounting policies
On December 7, 2018, the Ministry of Finance issued the notice on revising and Issuing the accounting standards for Business Enterprises No. 21 – leasing (CK [2018] No. 35) (hereinafter referred to as the “new leasing standards”), Enterprises that are required to be listed both at home and abroad and enterprises that are listed overseas and adopt international financial reporting standards or accounting standards for business enterprises to prepare financial statements shall be implemented as of January 1, 2019. Other enterprises that implement the accounting standards for business enterprises shall be implemented as of January 1, 2021.
According to the time requirements for the implementation of the above new leasing standards, the company needs to change its accounting policies accordingly.
(II) date of change
According to the requirements of the Ministry of finance, the company will implement the newly revised “new leasing standards” from January 1, 2021. (III) accounting policies adopted before change
Before the change of accounting policies, the company shall implement the accounting standards for business enterprises – basic standards, various specific accounting standards, application guidelines of accounting standards for business enterprises, interpretation announcement of accounting standards for business enterprises and other relevant regulations issued by the Ministry of finance.
(IV) accounting policies adopted after change
The company will implement the new leasing standards revised and issued by the Ministry of Finance in 2018. Other unchanged parts shall still be implemented in accordance with the accounting standards for business enterprises – basic standards, various specific accounting standards, the application guide of accounting standards for business enterprises, the interpretation announcement of accounting standards for business enterprises and other relevant provisions issued by the Ministry of Finance in the early stage.
2、 Impact of this accounting policy change on the company
(I) main contents of changes in accounting standards for Business Enterprises No. 21 – leasing
1. Under the new lease standards, except for short-term leases and low value asset leases, the lessee will no longer distinguish between financial leases and operating leases. All leases will adopt the same accounting treatment, and the right to use assets and lease liabilities must be recognized.
2. For the right to use assets, if the lessee can reasonably determine that it obtains the ownership of the leased assets at the expiration of the lease term, depreciation shall be accrued within the remaining service life of the leased assets. If it is impossible to reasonably determine that the ownership of the leased asset can be obtained at the expiration of the lease term, depreciation shall be accrued within the shorter of the lease term and the remaining service life of the leased asset. At the same time, the lessee shall determine whether the right of use assets are impaired, and accounting treatment shall be carried out for the identified impairment losses.
3. For lease liabilities, the lessee shall calculate the interest expense of the lease liabilities in each period of the lease term and record it into the current profits and losses.
4. For short-term leases and low value asset leases, the lessee may choose not to recognize the right of use assets and lease liabilities, and include them in the relevant asset costs or current profits and losses according to the straight-line method or other systematic and reasonable methods in each period of the lease term.
(II) impact of this accounting policy change on the company
According to the convergence provisions of the new lease standards, the company chooses to adjust the amount of retained earnings and other relevant items in the financial statements at the beginning of the year when the new lease standards are first implemented according to the cumulative impact of the first implementation of the new lease standards. The information of the comparable period is not adjusted, which will not have a significant impact on the company’s financial position, operating results and cash flow. This accounting policy change is a reasonable change made by the company in accordance with the requirements of relevant standards of the Ministry of finance, which complies with relevant regulations. The implementation of the changed accounting policy can objectively and fairly reflect the company’s financial status and operating results, will not have a significant impact on the company’s financial statements, and will not damage the interests of the company and shareholders.
3、 Review procedures of this accounting policy change
The accounting policy change has been deliberated and approved at the 14th meeting of the second board of directors and the 10th meeting of the second board of supervisors, and the independent directors have expressed their agreed independent opinions.
4、 Opinions of independent directors and board of supervisors
1. The independent directors believe that the change of the company’s accounting policies is a reasonable change and adjustment in accordance with the relevant accounting standards of the Ministry of finance, which can objectively and fairly reflect the company’s financial situation and operating results, and there is no situation that damages the interests of the company and all shareholders, especially small and medium-sized shareholders. The deliberation and voting procedures of the board of directors on the proposal of accounting policy change comply with relevant laws, regulations and the articles of association, and the relevant decision-making procedures are legal and effective. Agree to the change of the company’s accounting policy.
2. The board of supervisors believes that the change of accounting policy is a reasonable change made by the company in accordance with the relevant standards of the Ministry of finance, which meets the relevant provisions. The implementation of the changed accounting policy can objectively and fairly reflect the company’s financial status and operating results, will not have a significant impact on the company’s financial statements, and will not damage the interests of the company and shareholders.
5、 Documents for future reference
1. Henan Liliang Diamond Co.Ltd(301071) the resolution of the 14th meeting of the second board of directors;
2. Henan Liliang Diamond Co.Ltd(301071) the resolution of the 10th meeting of the second board of supervisors;
3. Henan Liliang Diamond Co.Ltd(301071) independent directors’ independent opinions on matters related to the 14th meeting of the second board of directors.
It is hereby announced.
Henan Liliang Diamond Co.Ltd(301071) board of directors
February 28, 2002
