Stock abbreviation: Unisplendour Corporation Limited(000938) Stock Code: Unisplendour Corporation Limited(000938) Announcement No.: 2022019
Unisplendour Corporation Limited(000938)
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、 Provision for asset impairment
According to the relevant provisions of the accounting standards for business enterprises and the company’s accounting policies, Unisplendour Corporation Limited(000938) (hereinafter referred to as “the company”) has comprehensively checked the accounts receivable, other accounts receivable, inventory, contract assets and other assets within the scope of the consolidated statements as of December 31, 2021, and fully evaluated and analyzed the possibility of recovery of accounts receivable, net realizable value of various inventories and the possibility of impairment of various assets, It is considered that some assets have certain signs of impairment. The company has made provision for asset impairment for assets with signs of impairment. The cumulative amount of provision in 2021 is 70266878578 yuan. The details are as follows:
Description of the provision for asset impairment of the amount (yuan) incurred in 2021
Bad debt loss 11357451477 the company has accrued bad debt reserves for accounts receivable, other accounts receivable and long-term accounts receivable according to the expected loss model
The impairment loss of contract assets is 522338957. The company has withdrawn the provision for impairment of contract assets according to the expected loss model
Inventory falling price loss 58104209384 the net realizable value of some inventories of the company is lower than its book value
Loan impairment loss 229462820 the company has withdrawn impairment provision in accordance with the loan impairment accounting policy
The impairment loss of fixed assets is 53415940. The recoverable amount of some fixed assets of the company is lower than its book value
Total 70266878578
2、 Withdrawal method of asset impairment provision
1. Impairment test method of financial assets and contract assets and provision method for impairment
For financial assets measured at amortized cost, debt instrument investment and contract assets measured at fair value and whose changes are included in other comprehensive income, the company shall carry out impairment accounting treatment and recognize loss reserves on the basis of expected credit losses.
For other financial instruments, except for the purchased or originated financial assets with credit impairment, the company evaluates the changes of credit risk of relevant financial instruments since initial recognition on each balance sheet date. If the credit risk of the financial instrument has increased significantly since the initial recognition, the company shall measure its loss reserves according to the amount equivalent to the expected credit loss of the financial instrument in the whole duration; If the credit risk of the financial instrument does not increase significantly after initial recognition, the company measures its loss reserves according to the amount equivalent to the expected credit loss of the financial instrument in the next 12 months.
The increased or reversed amount of credit loss reserves shall be included in the current profit and loss as impairment loss or gain, except for the financial assets measured at fair value and whose changes are included in other comprehensive income. For financial assets classified as measured at fair value and whose changes are included in other comprehensive income, the company recognizes its provision for credit loss in other comprehensive income, and records the impairment loss or gain into the current profit and loss, without reducing the book value of the financial assets listed in the balance sheet.
In the previous accounting period, the company has measured the loss reserve according to the amount equivalent to the expected credit loss of the financial instrument in the whole duration, but on the current balance sheet date, if the financial instrument no longer belongs to the situation of significant increase in credit risk since initial recognition, the company measures the loss reserve of the financial instrument according to the amount equivalent to the expected credit loss in the next 12 months, The reversal amount of the resulting loss reserves shall be included in the current profits and losses as impairment gains.
The company makes use of the available reasonable and based forward-looking information to determine whether the credit risk of financial instruments has increased significantly since the initial recognition by comparing the risk of default of financial instruments on the balance sheet date with the risk of default on the initial recognition date.
The company determines the credit loss of relevant financial instruments on the basis of combination of receivables.
The company determines the expected credit loss of relevant financial instruments according to the following methods:
1) For financial assets, the credit loss is the present value of the difference between the contract cash flow to be received by the company and the expected cash flow to be received;
2) For financial guarantee contracts, the credit loss is the present value of the difference between the estimated payment amount paid by the company to the contract holder for the credit loss incurred by the contract holder minus the amount expected to be collected by the company from the contract holder, debtor or any other party;
3) For the financial assets with credit impairment on the balance sheet date but not purchased or generated, the credit loss is the difference between the book balance of the financial assets and the present value of the estimated future cash flow discounted at the original effective interest rate.
The factors reflected in the company’s method of measuring the expected credit loss of financial instruments include: the unbiased probability weighted average amount determined by evaluating a series of possible results; Time value of money; Reasonable and reliable information about past events, current situation and prediction of future economic conditions that can be obtained without paying unnecessary additional costs or efforts on the balance sheet date.
2. Inventory falling price reserves
According to the company’s accounting policies, the company’s ending inventory is measured at the lower of cost and net realizable value. If the ending inventory cost is higher than its net realizable value, the inventory falling price reserves shall be withdrawn. The company usually withdraws inventory falling price reserves according to a single inventory item. For inventories with large quantity and low unit price, the inventory falling price reserves shall be withdrawn according to the inventory category. If the influencing factors of the previous provision for inventory falling price have disappeared, so that the net realizable value of the inventory is higher than its book value, the previously written down amount shall be restored within the original provision for inventory falling price, and the reversed amount shall be included in the current profit and loss.
3. Provision for loan impairment
According to the company’s accounting policies, the company first conducts a separate impairment test for loans with significant single amount. If there is objective evidence that they have been impaired, the impairment loss shall be recognized and included in the asset impairment loss. The company includes loans with insignificant single amount or loans that have not been impaired through separate test in the portfolio of financial assets with similar credit risk characteristics for impairment test. The company classifies the creditor’s rights formed by the loan business into five categories: normal category, special category, secondary category, suspicious category and loss category. The impairment reserves of 0%, 2%, 25%, 50% and 100% are accrued respectively according to the ending balance of assets.
4. Provision for impairment of fixed assets
The company judges whether there is any sign of possible impairment of assets on the balance sheet date. If there is any sign of impairment, the recoverable amount shall be estimated on the basis of single assets; If it is difficult to estimate the recoverable amount of a single asset, the recoverable amount of the asset group shall be determined based on the asset group to which the asset belongs.
The recognition of an asset group is based on whether the main cash inflow generated by the asset group is independent of the cash inflow of other assets or asset groups.
The estimation of the recoverable amount of an asset is determined according to the higher one between the net amount of its fair value minus the disposal expenses and the present value of the expected future cash flow of the asset. The company estimates its recoverable amount on the basis of individual assets; If it is difficult to estimate the recoverable amount of a single asset, the recoverable amount of the asset group shall be determined based on the asset group to which the asset belongs. The recognition of an asset group is based on whether the main cash inflow generated by the asset group is independent of the cash inflow of other assets or asset groups.
When the recoverable amount of an asset or asset group is lower than its book value, the book value of the asset shall be written down to the recoverable amount, and the written down amount shall be recognized as asset impairment loss and included in the current profits and losses, and the corresponding asset impairment reserves shall be accrued at the same time. After the asset impairment loss is recognized, the depreciation or amortization expenses of the impaired asset shall be adjusted accordingly in the future period, so that the adjusted book value of the asset (deducting the estimated net residual value) can be systematically apportioned within the remaining service life of the asset. Once the above asset impairment losses are recognized, they will not be reversed in future accounting periods. 3、 The impact of the provision for asset impairment on the company’s financial position
The provision for asset impairment accrued in 2021 will reduce the company’s consolidated net profit attributable to the owners of the parent company by 27996929847 yuan in 2021. The provision for asset impairment this time will be more conducive to truly and accurately reflect the company’s financial status and asset status.
It is hereby announced.
Unisplendour Corporation Limited(000938)
Board of directors
March 26, 2022
