Securities code: Chongqing Lummy Pharmaceutical Co.Ltd(300006) securities abbreviation: Chongqing Lummy Pharmaceutical Co.Ltd(300006) Announcement No.: 2022011 Chongqing Lummy Pharmaceutical Co.Ltd(300006)
With regard to the announcement on the provision for asset impairment in 2021, 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.
1、 Asset impairment loss and credit impairment loss accrued this time
(I) overview of asset impairment loss and credit impairment loss accrued this time
In accordance with the accounting standards for business enterprises and the relevant provisions of Chongqing Lummy Pharmaceutical Co.Ltd(300006) (hereinafter referred to as "the company") accounting policies, and based on the principle of prudence, the company conducted a comprehensive inspection and impairment test on all kinds of assets at the end of 2021 within the scope of consolidated statements. After the asset impairment test, the company believes that some assets have certain signs of impairment, and the company and its subsidiaries withdraw impairment reserves for assets that may have asset impairment.
According to the test results, after the company and its subsidiaries conducted a comprehensive inventory and asset impairment test of assets with possible signs of impairment at the end of 2021, they accrued 5145838731 yuan of asset impairment loss and credit impairment loss in 2021, as shown in the following table:
Unit: Yuan
Loss recognized in the current period of the project
1、 Bad debt loss 2347598468
Including: accounts receivable -142214332
Other receivables 2493779454
Notes receivable -3966654
2、 Inventory falling price loss 2798240263
Total 5145838731
(II) withdrawal method and recognition standard of the current provision for asset impairment
The provision for asset impairment withdrawn this time includes bad debt provision for receivables and inventory falling price provision.
1. In 2021, the company accrued 2347598468 yuan of bad debt provision for accounts receivable, and the bad loss provision for accounts receivable:
① Financial assets measured at amortized cost;
② Financial assets measured at fair value with changes included in other comprehensive income.
Other financial assets measured at fair value held by the company are not applicable to the expected credit loss model, including debt investment or equity instrument investment measured at fair value and the change of which is included in the current profit and loss, equity instrument investment designated as measured at fair value and the change of which is included in other comprehensive income, and derivative financial assets.
1) Measurement of expected credit loss
Expected credit loss refers to the weighted average value of credit loss of financial instruments weighted by the risk of default. Credit loss refers to the difference between all contract cash flows receivable under the contract and all cash flows expected to be received by the company discounted at the original effective interest rate, that is, the present value of all cash shortages.
The company measures the loss provision for all accounts receivable formed by transactions regulated by the income standard according to the amount equivalent to the expected credit loss in the whole duration. In addition, the company measures the expected credit losses of financial instruments at different stages. If the credit risk of the financial instrument has not increased significantly since the initial recognition, it is in the first stage, and the company measures the loss reserves according to the expected credit loss in the next 12 months; If the company's credit risk has not increased significantly since the credit loss of the financial instrument is expected to occur, but the financial instrument has been in the second stage since the credit loss has been recognized; If a financial instrument has been impaired since its initial recognition, it is in the third stage. The company measures the loss provision according to the expected credit loss of the whole duration of the instrument.
For financial instruments with only low credit risk on the balance sheet date, the company assumes that their credit risk has not increased significantly since initial recognition. For receivables without major financing components, the company uses simplified measurement method to measure the loss provision according to the expected credit loss amount equivalent to the whole duration.
2) Criteria for judging whether credit risk has increased significantly since initial recognition
If using the available reasonable and reliable forward-looking information and through comparison, it is found that the default probability of a financial asset within the expected duration determined on the balance sheet date is significantly higher than that within the expected duration determined at the initial recognition, it indicates that the credit risk of the financial asset has increased significantly.
3) Financial assets with credit impairment
On the balance sheet date, the company evaluates whether the financial assets measured at amortized cost and the creditor's rights investment measured at fair value and whose changes are included in other comprehensive income have been impaired.
When one or more events that have an adverse impact on the expected future cash flow of a financial asset occur, the financial asset becomes a financial asset with credit impairment.
The evidence of credit impairment of financial assets includes the following observable information: ① significant financial difficulties of the issuer or debtor; ② The debtor violates the contract, such as default or overdue payment of interest or principal; ③ The creditor gives concessions that the debtor will not make under any other circumstances due to economic or contractual considerations related to the debtor's financial difficulties; ④ The debtor is likely to go bankrupt or carry out other financial restructuring; ⑤ The financial difficulties of the issuer or debtor lead to the disappearance of the active market of the financial assets;
4) Recognition of expected credit loss
Considering the credit risk characteristics of different customers, the company evaluates the expected credit loss of financial instruments by single and combined methods.
When a single financial asset cannot evaluate the information of expected credit loss at a reasonable cost, the company divides the receivables into several combinations according to the characteristics of credit risk, and calculates the expected credit loss on the basis of the combination. The basis for determining the combination is as follows:
Project portfolio
Notes receivable bank acceptance bill
Commercial acceptance bill of notes receivable
Aging combination of accounts receivable
Other receivables and dividends receivable
Interest receivable on other receivables
Risk portfolio of receivables of other receivables agency business
Aging combination of other receivables
For the accounts receivable and commercial acceptance bills divided into aging combination, the company refers to the historical credit loss experience, combined with the current situation and the prediction of future economic conditions, adopts the preparation of the comparison table between the aging of accounts receivable and the expected credit loss rate throughout the duration, determines the comparison table according to the historical default rate of accounts receivable observed in the expected repayment period, and adjusts the forward-looking estimation.
No provision for credit impairment loss shall be made for bank acceptance bills.
2. In 2021, the company made provision for inventory falling price of 2798240263 yuan. The method of making provision for inventory falling price is as follows:
Net realizable value refers to the amount of the estimated selling price of inventory minus the estimated cost to be incurred at the time of completion, estimated selling expenses and relevant taxes in daily activities. When determining the net realizable value of inventories, it shall be based on the conclusive evidence obtained, and consider the purpose of holding inventories and the impact of events after the balance sheet date.
On the balance sheet date, inventories are measured at the lower of cost and net realizable value. When the net realizable value is lower than the cost, the inventory falling price reserves shall be withdrawn. Inventory falling price reserves are usually withdrawn according to the difference between the cost of a single inventory item and its net realizable value. For the inventory with large quantity and low unit price, the inventory falling price reserves shall be withdrawn according to the inventory category; For the inventories related to the product series produced and sold in the same region, with the same or similar end use or purpose, and difficult to be measured separately from other items, the inventory falling price reserves can be accrued jointly.
After the provision for inventory falling price is made, if the factors affecting the previous write down of inventory value have disappeared, resulting in the net realizable value of inventory being higher than its book value, it shall be reversed from the amount of inventory falling price provision that has been made, and the reversed amount shall be included in the current profit and loss.
2、 Non operating expenses recognized this time
According to the first instance judgment of Chongqing Laimei Pharmaceutical Co., Ltd. (hereinafter referred to as "Laimei pharmaceutical"), a wholly-owned subsidiary of the company, and Changchun Haiyue Pharmaceutical Co., Ltd. (hereinafter referred to as "Changchun Haiyue") on the sale right of tadalafil tablets, Changchun Haiyue needs to return 37.5 million yuan of the transfer money of the sale right to Laimei pharmaceutical, and Laimei pharmaceutical compensates 37.5 million yuan of the loss of the available interests of Changchun Haiyue. Based on the principle of prudence, The adjustment reduces the remaining book amount of "tadalafil film sales right" calculated in intangible assets, and confirms the non operating expenditure of 3537735750 yuan.
3、 The impact of the provision for asset impairment, credit impairment loss and recognition of non operating expenses on the company's financial position
The impact of the provision for asset impairment and credit impairment loss on the company's total profit in 2021 is -5145838731 yuan and the impact on the owner's equity is -4361972255 yuan; The impact of non operating expenses on the company's total profit in 2021 is -3537735750 yuan and the impact on owner's equity is - Vt Industrial Technology Co.Ltd(300707) 5388 yuan.
4、 The board of directors' statement on the reasonableness of the provision for asset impairment and other matters
The company's provision for asset impairment, credit impairment loss and recognition of non operating expenses comply with the accounting standards for business enterprises and other relevant provisions, and truly reflect the company's financial status, asset value and operating results.
5、 Review opinions of the board of supervisors on the provision for asset impairment and other matters
The board of supervisors believes that the company's provision for asset impairment, credit impairment loss and recognition of non operating expenses comply with the accounting standards for business enterprises and other relevant provisions, and truly reflect the company's financial status, asset value and operating results. It conforms to the actual situation of the company and does not damage the interests of the company and shareholders.
6、 Opinions of independent directors
After verification, the independent directors believe that the company's provision for asset impairment, credit impairment loss and recognition of non operating expenses in 2021 are based on sufficient basis, the decision-making procedures are standardized and legal, comply with the accounting standards for business enterprises and relevant accounting policies of the company, and can objectively and fairly reflect the financial status, asset value and operating results of the company as of December 31, 2021, There is no situation that damages the interests of the company and all shareholders, especially the interests of minority shareholders. We agree to the implementation of the provision for asset impairment in 2021 and agree to submit the matter to the general meeting of shareholders for deliberation.
7、 Other instructions
Sichuan Huaxin (Group) certified public accountants firm (special general partnership) has proposed to withdraw the provision for asset impairment, credit impairment loss and confirm non operating expenses when performing the company's annual audit in 2021. The provision for asset impairment, credit impairment loss and recognition of non operating expenses need to be submitted to the 2021 annual general meeting of shareholders of the company for deliberation.
8、 Documents for future reference
1. Chongqing Lummy Pharmaceutical Co.Ltd(300006) the resolution of the 22nd Meeting of the 5th board of directors;
2. Chongqing Lummy Pharmaceutical Co.Ltd(300006) the resolution of the 18th meeting of the 5th board of supervisors;
3. Independent opinions of independent directors on 2021 annual report and other related matters.
It is hereby announced.
Chongqing Lummy Pharmaceutical Co.Ltd(300006) board of directors March 25, 2022
