Audit report Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929)
Rong Cheng Shen Zi [2022] No. 230z0460
Rongcheng Certified Public Accountants (special general partnership)
Beijing, China
catalogue
Serial number content page number
1 audit report 1-6
2 consolidated balance sheet 7
3 consolidated income statement 8
4 consolidated cash flow statement 9
5 consolidated statement of changes in owner's equity 10
6 balance sheet of parent company 12
7. Income statement of the parent company 13
8 cash flow statement of parent company 14
9. Statement of changes in owner's equity of the parent company 15
10 notes to the financial statements 17 - 144
Audit report
Rong Cheng Shen Zi [2022] No. 230z0460 Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) all shareholders:
1、 Audit opinion
We have audited the financial statements of Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) (hereinafter referred to as Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) ), including the consolidated and parent company's balance sheet as of December 31, 2021, the consolidated and parent company's income statement, consolidated and parent company's cash flow statement, consolidated and parent company's statement of changes in owner's equity and notes to relevant financial statements in 2021.
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 financial position of Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) the consolidated and parent company as of December 31, 2021 and the operating results and cash flow of the consolidated and parent company in 2021.
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. According to the code of professional ethics for Chinese certified public accountants, we are independent of Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) , 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.
3、 Key audit matters
The key audit matters are the most important matters that we consider to audit the current financial statements according to our professional judgment. We shall not express an opinion on these matters based on the overall audit of the financial statements.
(I) recognition of business income of water environment treatment project
1. Item description
As shown in the accounting policies described in "III. important accounting policies and accounting estimates" 26 in the notes to the financial statements and "v. item notes to the consolidated financial statements" 41. In 2021 Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) confirmed the business income of water environment treatment project of 49399231923 yuan, accounting for 77.84% of the total income; For the performance obligation performed within a certain period of time, the revenue shall be recognized according to the performance progress determined by the input method during the contract period, and the performance progress shall be determined according to the proportion of the actual contract cost incurred for the performance of the contract to the estimated total contract cost. The performance schedule requires the Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) Management (hereinafter referred to as the "management") to make major judgments and estimates, including the judgment and estimation of the contract completion schedule, delivery and service scope, the estimated total contract cost, the cost to complete the contract, the total contract revenue and contract risk, Therefore, we identified the revenue recognized from the performance progress of the water environment treatment project business as a key audit matter.
2. Audit response
The relevant procedures we implement mainly include:
For the revenue recognition of water environment treatment engineering business, our main audit procedures are as follows:
(1) Understand, evaluate and test the internal control related to the budget preparation, performance schedule calculation and revenue recognition of water environment treatment project business contract;
(2) Sample check the business contract and cost budget data of water environment treatment project on which the management's estimated total revenue and estimated total cost are based, compare the difference between the actual cost of completed settlement projects and the estimated total cost, and evaluate whether the major judgments and estimates made by the management are reasonable and sufficient;
(3) Sample test the accuracy of the contract performance costs incurred;
(4) Implement cut-off test procedures to check whether the relevant contract performance costs are recorded in the appropriate accounting period;
(5) Select the business contract sample of water environment treatment project, obtain the project progress confirmation confirmed by the owner or supervisor, compare it with the calculated performance progress, and conduct on-site investigation on the project image progress to evaluate the rationality of performance progress;
(6) Obtain the standing book of water environment treatment project business contract, and recalculate the performance progress and contract income.
Based on the above work, we believe that the relevant evidence can support the important accounting estimates and judgments of the management on the recognition of business income of water environment treatment project.
1. Item description
As shown in "III. important accounting policies and accounting estimates" 10 and 13 in the notes to the financial statements and "v. notes to consolidated financial statements" 4 and 8. As of December 31, 2021, Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) accounts receivable balance is 27065267619 yuan, accounts receivable bad debt provision balance is 2761579751 yuan, contract asset balance is 27007282391 yuan, and contract asset impairment provision is 574922173 yuan. As the balance of accounts receivable and contract assets is significant and the evaluation of bad debt provision involves significant judgment of the management, we regard the impairment of accounts receivable and contract assets as a key audit matter.
2. Audit response
The relevant procedures for the provision of impairment of accounts receivable and contract assets mainly include:
(1) Understand, evaluate and test the effectiveness of the design and operation of key internal controls related to accounts receivable, contract asset management and impairment test;
(2) Analyze the rationality and consistency of the accounting estimates of the management for the provision of expected credit losses of accounts receivable and contract assets, including the basis for determining the combination of accounts receivable and the judgment of separate provision for bad debts; (3) Evaluate the rationality of the provision for bad debts of accounts receivable by analyzing the aging of accounts receivable and the reputation of customers, and implementing the procedures of letter of confirmation of accounts receivable and the collection after the inspection period;
(4) Obtain the bad debt provision of accounts receivable and the provision for impairment of contract assets, and check the rationality and accuracy of the evaluation of the expected credit loss of accounts receivable and contract assets.
Based on the above work, we believe that the relevant evidence can support the management's important accounting estimates and judgments on the impairment of accounts receivable and contract assets.
4、 Other information
Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) Management (hereinafter referred to as management) is responsible for other information. Other information includes the information covered in Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) 2021 annual report, but does not include the financial statements and our audit report.
Our audit opinion on the financial statements does not cover other information, and we will not issue any form of assurance conclusion on other information.
In combination with our audit of the financial statements, our responsibility is to read other information and consider whether other information is materially inconsistent with the financial statements or the information we have learned in the audit process, or there seems to be material misstatement.
Based on the work we have performed, if we determine that there is a material misstatement in other information, we should report that fact. In this regard, we have nothing to report.
5、 Responsibilities of management and governance for financial statements
Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) the management (hereinafter referred to as 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 due to fraud or error.
When preparing the financial statements, the management is responsible for evaluating the going concern ability of Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) and disclosing the matters related to going concern (if applicable), and applying the going concern assumption, unless the management plans to liquidate Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) , terminate the operation or has no other realistic choice.
The management is responsible for supervising the financial reporting process of Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) .
6、 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. The risk of fraud, collusion or failure to control may be higher than that caused by the discovery of material misstatement or fraud.
(2) Understand the internal control related to audit to design appropriate audit procedures.
(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 Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) 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 cause Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) unable 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 entities or business activities in Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) 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. We describe these matters in the audit report, unless laws and regulations prohibit the public disclosure of these matters, or in rare cases, if the negative consequences of communicating a matter in the audit report are reasonably expected to exceed the benefits in the public interest, we determine that we should not communicate the matter in the audit report.
(there is no text on this page, which is the signature and seal page of Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) Rong Cheng Shen Zi [2022] No. 230z0460 report.)
Rongcheng certified public accountants China Certified Public Accountants:
(special general partnership) Mao Wei (project partner) Chinese certified public accountant:
Li Zeyi
Beijing, China Certified Public Accountant:
Qian Yanping
March 9, 2022
Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929)
Notes to financial statements
Year 2021
(unless otherwise specified, the monetary unit is RMB)
1、 Basic information of the company
1. Company profile
Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) (hereinafter referred to as "the company" or "the company") was formerly MAANSHAN Anhui Huaqi Environmental Protection&Technology Co.Ltd(300929) Technology Development Co., Ltd. (hereinafter referred to as "Huaqi Co., Ltd"). Huaqi Co., Ltd. was jointly funded by Angong Huaye Automation Engineering Co., Ltd., Li Minghe and other 24 natural person shareholders,
