Securities abbreviation: Guangzhou Lingnan Group Holdings Company Limited(000524) securities code: Guangzhou Lingnan Group Holdings Company Limited(000524) Announcement No.: 2022021
Guangzhou Lingnan Group Holding Co., Ltd
Announcement on changes in accounting policies
Important note: 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.
Special tips:
This accounting policy change is a corresponding change made by Guangzhou Lingnan Group Holdings Company Limited(000524) (hereinafter referred to as "the company") in accordance with the relevant accounting standards for business enterprises revised by the Ministry of finance of the people's Republic of China (hereinafter referred to as "the Ministry of finance"), which will not have a significant impact on the company's financial position, operating results and cash flow.
On March 21, 2022, the 20th meeting of the 10th Session of the board of directors and the 12th meeting of the 10th Session of the board of supervisors of the company deliberated and adopted the proposal on changes in accounting policies. This change in accounting policies does not need to be submitted to the general meeting of shareholders for deliberation. The specific contents are hereby announced as follows:
1、 Overview of changes in accounting policies
(I) reasons for change
The notice on printing and distributing the interpretation of accounting standards for Business Enterprises No. 15 (CAI Kuai [2021] No. 35) (hereinafter referred to as "Interpretation No. 15" or "this interpretation") issued by the Ministry of Finance on December 30, 2021 stipulates the accounting treatment of the external sales of products or by-products produced before the fixed assets reach the expected usable state or in the process of R & D, the relevant presentation of centralized fund management and the judgment of loss contracts. According to the above requirements, the company will adjust the accounting policies related to the external sales of products or by-products (hereinafter referred to as trial operation sales) before the fixed assets reach the expected serviceable state or during the research and development process in accordance with the provisions of Interpretation No. 15 from January 1, 2022.
(II) accounting policies adopted before change
Before the change of accounting policies, the accounting policies implemented by the company are the accounting standards for business enterprises - basic standards, various specific accounting standards, application guide of accounting standards for business enterprises, interpretation announcement of accounting standards for business enterprises and other relevant regulations issued by the Ministry of finance.
(III) accounting policies adopted after change
The company will implement the Interpretation No. 15 issued by the Ministry of Finance on December 30, 2021. 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.
(IV) date of change
The company will start to implement it from January 1, 2022.
2、 Impact of this accounting policy change on the company
(I) main contents of this accounting policy change
Interpretation No. 15 specifies the accounting treatment related to the external sales of products or by-products (hereinafter referred to as trial operation sales) before the fixed assets reach the expected usable state or during the research and development process, mainly including the following contents:
1. For trial operation sales, enterprises shall, in accordance with the provisions of accounting standards for Business Enterprises No. 14 - revenue and accounting standards for Business Enterprises No. 1 - inventory, respectively, account for the income and costs related to trial operation sales and record them into the current profits and losses. The net amount of the income related to trial operation sales after offsetting the relevant costs shall not be used to offset the cost of fixed assets or R & D expenses.
2. Before the relevant products or by-products produced by the trial operation are sold, those that meet the provisions of the accounting standards for Business Enterprises No. 1 - inventory shall be recognized as inventory, and those that meet the relevant asset recognition conditions in other relevant accounting standards for business enterprises shall be recognized as relevant assets.
3. The expenses incurred for testing whether the fixed assets can operate normally belong to the necessary expenses before the fixed assets reach the expected usable state, and shall be included in the cost of the fixed assets in accordance with the relevant provisions of the accounting standards for Business Enterprises No. 4 - fixed assets.
4. An enterprise shall, in accordance with the accounting standards for Business Enterprises No. 1 - inventory, accounting standards for Business Enterprises No. 14 - revenue, accounting standards for Business Enterprises No. 30 - presentation of financial statements and other provisions, judge whether the trial operation sales belong to the daily activities of the enterprise, and present the relevant income and costs of the trial operation sales in the financial statements by distinguishing between daily activities and non daily activities. Those belonging to daily activities are listed in the items of "operating income" and "operating cost", and those belonging to non daily activities are listed in the items of "income from asset disposal". At the same time, the enterprise shall separately disclose the relevant income and cost amount of trial operation sales, the specific reporting items and the important accounting estimates used in determining the relevant costs of trial operation sales in the notes.
5. According to the provisions on the connection between the old and the new, the enterprise shall make retroactive adjustment in accordance with the provisions of this interpretation for the trial operation sales between the beginning of the earliest period for the presentation of the financial statements for the first time and the implementation date of this interpretation; If the retroactive adjustment is not feasible, the enterprise shall apply the provisions of this interpretation from the beginning of the earliest period of retroactive adjustment, and disclose the specific reasons for the failure of retroactive adjustment in the notes.
(II) impact of this accounting policy change on the company
According to the Interpretation No. 15 and in combination with the actual situation of the trial operation sales of the company, the qualified trial operation sales shall be accounted for and included in the current profit and loss in accordance with the accounting standards for Business Enterprises No. 14 - revenue and accounting standards for Business Enterprises No. 1 - inventory. Before the relevant products or by-products produced by the trial operation are sold, those that meet the provisions of the accounting standards for Business Enterprises No. 1 - inventory are recognized as inventory, and those that meet the relevant asset recognition conditions in other relevant accounting standards for business enterprises are recognized as relevant assets. The company will implement the relevant provisions of Interpretation No. 15 from January 1, 2022. This change in accounting policy will not have a significant impact on the company's financial statements, financial position, operating results and cash flow.
3、 Explanation of the board of directors on the rationality of accounting policy change
On March 21, 2022, the 20th meeting of the 10th board of directors of the company deliberated and adopted the proposal on accounting policy change with 8 votes in favor, 0 votes against and 0 abstentions, and agreed to the change of accounting policy. After review, the board of Directors believes that the change of the company's accounting policies is carried out in accordance with the relevant documents of the Ministry of Finance and in line with the provisions of relevant laws, regulations and accounting standards for business enterprises. The changed accounting policies can objectively and fairly reflect the company's financial status and operating results, and will not have a significant impact on the company's financial status, operating results and cash flow, There is no situation that damages the interests of the company and all shareholders, especially minority shareholders.
4、 Opinions of independent directors
The independent directors believe that the change of accounting policy is a reasonable change and adjustment in accordance with the provisions issued by the Ministry of finance, and the implementation of the new change of accounting policy can objectively and fairly reflect the financial status and operating results of the company; The relevant decision-making procedures of this accounting policy change comply with relevant laws and regulations and the articles of association, and there is no situation that damages the interests of the company and shareholders.
5、 Opinions of the board of supervisors
On March 21, 2022, the 12th meeting of the 10th board of supervisors of the company deliberated and adopted the proposal on accounting policy change with 5 votes in favor, 0 votes against and 0 abstentions. The board of supervisors believes that the change of the company's accounting policies complies with the relevant provisions of the Ministry of Finance and the actual situation of the company, and there is no damage to the interests of the company and all shareholders.
6、 Documents for future reference 1. Resolutions of the 20th meeting of the 10th Session of the board of directors; 2. Resolutions of the 12th meeting of the 10th Session of the board of supervisors; 3. Opinions of independent directors. It is hereby announced.
Guangzhou Lingnan Group Holdings Company Limited(000524) board of directors
March 21, 2002
