Securities code: 000529 securities abbreviation: Guangdong Guanghong Holdings Co.Ltd(000529) Announcement No.: 2021-65
Guangdong Guanghong Holdings Co.Ltd(000529)
Announcement on changes in accounting policies of the company
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
Guangdong Guanghong Holdings Co.Ltd(000529) (hereinafter referred to as: Guangdong Guanghong Holdings Co.Ltd(000529) or the company) held the fourth interim board meeting in 2021 and the second interim board meeting in 2021 on December 14, 2021, and deliberated and adopted the proposal on the change of the company’s accounting policies respectively. The details are as follows:
1、 Summary of changes in accounting policies
(i) Reason and date of accounting policy change
The company’s measurement method for investment real estate is initially determined as cost measurement mode. At present, the investment real estate held by the company is mainly located at No. 520, North Guangzhou Avenue, which is used for external lease. With the economic development of the region where it is located, the real estate value changes greatly. Using the fair value model can dynamically reflect the fair value of investment real estate. In order to more objectively reflect the fair value of the investment real estate held by the company and facilitate investors to objectively understand the assets of the company, according to the relevant provisions of accounting standards for Business Enterprises No. 3 – investment real estate and accounting standards for Business Enterprises No. 28 – changes in accounting policies, accounting estimates and error correction, The company plans to change the accounting policy of the subsequent measurement mode of investment real estate from cost measurement mode to fair value measurement mode from December 31, 2021. After the change of accounting policy, the company will take the evaluation results of relevant investment real estate issued by the evaluation institution as the fair value of investment real estate. Date of change: December 31, 2021
（2） Changes in accounting policies adopted before and after the change
1. Accounting policies adopted before change
The company’s investment real estate is mainly houses and buildings used for lease for a long time. Before change, the company’s investment real estate is subsequently measured in the cost mode, and the buildings and land use rights are depreciated or amortized according to their expected service life and net residual value rate. The expected service life, net residual value rate and annual depreciation (amortization) rate of investment real estate are listed as follows:
Type depreciation life (year) estimated residual value rate (%) annual depreciation rate (%)
Houses and buildings 20-450.00-5.00% 2.375% – 5.00%
2. Accounting policies adopted after change
After this change, the company adopts the fair value model for subsequent measurement of investment real estate without depreciation or amortization. Its book value is adjusted based on the fair value of investment real estate on the balance sheet date, and the difference between the fair value and the original book value is included in the current profit and loss.
The investment real estate measured by the fair value model shall not be changed from the fair value model to the cost model.
When the investment real estate is disposed of or permanently withdrawn from use and it is not expected to obtain economic benefits from its disposal, the recognition of the investment real estate is terminated. The disposal income from the sale, transfer, scrapping or damage of investment real estate shall be included in the current profit and loss after deducting its book value and relevant taxes.
2、 Impact of this accounting policy change on the company
According to the accounting standards for Business Enterprises No. 3 – investment real estate, if the measurement mode of investment real estate changes from cost mode to fair value mode, it belongs to the change of accounting policy and shall be handled in accordance with the accounting standards for Business Enterprises No. 28 – changes in accounting policies, accounting estimates and error correction. If changes in accounting policies can provide more reliable and relevant accounting information, the retrospective adjustment method shall be adopted. The company will implement the above accounting standards as of December 31, 2021.
According to the preliminary calculation of the company, the retroactive adjustment of the accounting policy change of the company’s investment real estate will increase the owner’s equity attributable to the shareholders of the listed company by 112.1404 million yuan on December 31, 2020 Increase the net profit attributable to shareholders of Listed Companies in 2020 by 15.582 million yuan (the above data are based on the consolidated criteria); the retroactive adjustment of this accounting policy change increases the owner’s equity attributable to the shareholders of the listed company by 96.5584 million yuan as of December 31, 2019 and the net profit attributable to the shareholders of the listed company by 96.5584 million yuan in 2019. The above data are the preliminary calculation results of the financial department of the company. Without the audit of the accounting firm, the specific financial statements of the company The impact of business status and operating results will be subject to the results confirmed by the annual audit institution. The change of accounting policy will not lead to the change of profit and loss nature after retroactive adjustment of the annual financial report disclosed by the company in the latest year. This accounting policy change will not lead to changes in the nature of the company’s undisclosed profits and losses in the latest reporting period, and the company expects that the impact of this accounting policy change on the audited net profit of the latest accounting year and the audited owner’s equity of the latest period will not exceed 50%.
After the change of accounting policy, the company will take the evaluation results of relevant investment real estate issued by the evaluation institution as the fair value of investment real estate; If the fair value of relevant assets changes due to the impact of macroeconomic environment, it may increase the risk of future annual performance fluctuation of the company.
3、 Review procedures of this accounting policy change
According to the stock listing rules of Shenzhen Stock Exchange, the guidelines for the standardized operation of companies listed on the main board of Shenzhen Stock Exchange, laws, regulations, normative documents and the articles of association, the proposal on the change of the company’s accounting policies has been deliberated and adopted at the fourth interim board meeting of the company in 2021 and the second interim board meeting of the company in 2021, The independent directors of the company expressed their independent opinions. The proportion of the impact of this accounting policy change on the audited net profit of the latest fiscal year and the audited shareholders’ equity of the latest period will not exceed 50%, which does not need to be submitted to the shareholders’ meeting for deliberation.
4、 Explanation of the board of directors on the reasonableness of this accounting policy change
The board of directors of the company believes that the follow-up measurement of the company’s investment real estate using the fair value model is reasonable and operable, and the change of the company’s accounting policies complies with the relevant provisions of accounting standards for Business Enterprises No. 3 – investment real estate and accounting standards for Business Enterprises No. 28 – changes in accounting policies, accounting estimates and error correction, The changed accounting policy can provide more reliable accounting information, help to more objectively and fairly reflect the company’s financial situation, comply with relevant regulations and the actual situation of the company, and there is no damage to the interests of the company and minority shareholders. We agree to the change of accounting policy.
5、 Opinions of independent directors
After verification, the change of the company’s accounting policies complies with the provisions of accounting standards for Business Enterprises No. 3 – investment real estate and accounting standards for Business Enterprises No. 28 – changes in accounting policies, accounting estimates and error correction. The changed accounting policies can objectively and fairly reflect the company’s financial situation and operating results, Relevant decision-making procedures comply with relevant laws and regulations, the articles of association and other provisions, and there is no situation damaging the interests of the company and shareholders. Therefore, we agree to the accounting policy change of the company.
6、 Opinions of the board of supervisors
After verification, the company has changed its accounting policies in accordance with the accounting standards for Business Enterprises No. 3 – investment real estate and accounting standards for Business Enterprises No. 28 – changes in accounting policies and accounting estimates and error correction, which are in line with relevant regulations and the actual situation of the company, and its decision-making procedures are in line with relevant laws and regulations and the articles of association, It does not harm the interests of the company and all shareholders. Therefore, we agree to the change of accounting policies of the company.
7、 Documents for future reference
(i) Resolution of the fourth extraordinary board meeting of the company in 2021
（2） Resolution of the second interim Board of supervisors meeting of the company in 2021
（3） Explanation of the board of directors on the rationality of changes in accounting policies
（4） Opinions of the board of supervisors on changes in the company’s accounting policies
（5） The independent opinions of the independent directors on the change of the company’s accounting policies are hereby announced.
Guangdong Guanghong Holdings Co.Ltd(000529) board of directors December 15, 2001
