Jiangsu Expressway Company Limited(600377)
From January 1, 2021
Financial statements for the year ended December 31, 2021
Jiangsu Expressway Company Limited(600377)
Notes to financial statements
(unless otherwise specified, the monetary unit is RMB)
1、 Basic information of the company
Jiangsu Expressway Company Limited(600377) (hereinafter referred to as “the company”) is a joint stock limited company incorporated in Nanjing, Jiangsu Province on August 1, 1992, with its headquarters located in Nanjing, Jiangsu Province. The parent company and ultimate holding company of the company are Jiangsu Transportation Holding Co., Ltd. (“transportation holding”).
The company and its subsidiaries (hereinafter referred to as “the group”) are mainly engaged in the construction, operation and management of Jiangsu section of Shanghai Nanjing Expressway (“Shanghai Nanjing expressway”) and other highways in Jiangsu Province, and develop passenger transport and other services along the highway. See note VII for relevant information of the company’s subsidiaries.
During the reporting period, see note VI for the new subsidiaries of the group.
2、 Preparation basis of financial statements
As of December 31, 2021, the total amount of current liabilities of the group exceeded the total amount of current assets by RMB 452131450580. On December 31, 2021, the group has signed a credit contract with the bank, and the unused loan line with a credit term of more than one year is not less than RMB 100000000000. The line of ultra short-term financing bonds registered with Bank Of China Limited(601988) inter market dealers association but not yet issued with a registration term of more than one year is RMB 552000000000. The management of the company believes that the continuous operation of the group can be maintained through the above credit line. Therefore, the financial statements are prepared on the basis of the assumption of continuous operation.
3、 Important accounting policies and accounting estimates of the company
The group’s main business is toll road operation, so the accounting policy for the amortization of Expressway franchise rights is formulated according to the operating characteristics of the expressway industry. For details, see relevant notes III and 16.
1. Statement of compliance with accounting standards for business enterprises
The financial statements comply with the requirements of the accounting standards for business enterprises issued by the Ministry of finance, and truly and completely reflect the consolidated financial position and financial position of the company as of December 31, 2021, the consolidated operating results and operating results, and the consolidated cash flow and cash flow of the company in 2021.
In addition, the financial statements of the company also comply with the disclosure requirements of the financial statements and notes in the rules for the preparation of information disclosure of companies offering securities to the public No. 15 – General Provisions on financial reports revised by the China Securities Regulatory Commission (hereinafter referred to as the “CSRC”) in 2014.
2. Accounting period
The fiscal year starts on January 1 and ends on December 31 of the Gregorian calendar.
3. Business cycle
The company regards the period from the purchase of assets for processing to the realization of cash or cash equivalents as the normal business cycle. Except for the real estate industry, the group takes 12 months as an operating cycle and takes it as the liquidity classification standard of assets and liabilities. The business cycle of the real estate industry is from real estate development to sales and realization. The specific cycle is determined according to the development project. The business cycle is used as the liquidity division standard of assets and liabilities. The business cycle is usually more than 12 months.
4. Recording currency
The bookkeeping base currency of the company is RMB, and the currency used in the preparation of financial statements is RMB. The bookkeeping functional currency selected by the company and its subsidiaries is based on the pricing and settlement currency of main business revenue and expenditure.
5. Accounting treatment methods for business combinations under the same control and not under the same control
If the group obtains control over another or more enterprises (or a group of assets or net assets) and it constitutes a business, the transaction or event constitutes a business combination. Business combinations are divided into business combinations under the same control and business combinations not under the same control. For transactions not under the same control, when judging whether the acquired asset portfolio constitutes a business, the purchaser will consider whether to choose the simplified judgment method of “concentration test”. If the combination passes the concentration test, it is judged that it does not constitute a business. If the combination fails to pass the concentration test, it shall still be judged according to the business conditions.
When the group obtains a group of assets or net assets that do not constitute a business, the purchase cost shall be allocated according to the relative fair value of all identifiable assets and liabilities obtained on the purchase date, and shall not be treated according to the following accounting treatment methods of business combination.
(1) Business combination under the same control
A business combination under the same control is a business combination in which the enterprises participating in the merger are ultimately controlled by the same party or the same parties before and after the merger, and the control is not temporary. The assets and liabilities acquired by the combining party in the business combination shall be measured according to the book value in the consolidated financial statements of the final controller on the combination date. For the difference between the book value of the net assets obtained and the book value of the merger consideration paid (or the total face value of the issued shares), adjust the share capital premium in the capital reserve; If the capital stock premium in the capital reserve is insufficient to be offset, the retained earnings shall be adjusted. The directly related expenses incurred for business combination shall be included in the current profit and loss when incurred. The date of merger is the date on which the combining party actually obtains control over the combined party.
(2) Business combination not under the same control
If the parties involved in the merger are not ultimately controlled by the same party or the same parties before and after the merger, it is a business merger not under the same control. The sum of the assets paid by the group as the acquirer to obtain the control of the acquiree (including the equity of the acquiree held before the acquisition date), the liabilities incurred or assumed and the fair value of the issued equity securities on the acquisition date minus the difference between the fair value share of the identifiable net assets of the acquiree obtained in the merger on the acquisition date. If it is positive, it is recognized as goodwill; If it is negative, it shall be included in the current profit and loss. The group will include the transaction costs of equity securities or debt securities issued as merger consideration into the initially recognized amount of equity securities or debt securities.
Other direct expenses incurred by the group for business combination are included in the current profit and loss. The difference between the fair value of paid assets and their book value shall be included in the current profits and losses. The Group recognizes the identifiable assets, liabilities and contingent liabilities of the acquiree that meet the recognition conditions at fair value on the acquisition date. The date of purchase refers to the date on which the purchaser actually obtains control over the acquiree.
When the business combination not under the same control is realized step by step through multiple transactions, the group will re measure the equity of the acquiree held before the acquisition date according to the fair value of the equity on the acquisition date, and the difference between the fair value and its book value is included in the current investment income or other comprehensive income. Other comprehensive income and other changes in owner’s equity (refer to note III, 11 (2) (b)) related to the equity of the acquiree held before the acquisition date, which can be reclassified into profit and loss under the equity method, are transferred to the current investment income on the acquisition date; If the equity of the acquiree held before the acquisition date is an equity instrument investment measured at fair value and its changes are included in other comprehensive income, the other comprehensive income recognized before the acquisition date is transferred to retained income on the acquisition date.
6. Preparation method of consolidated financial statements (1) general principles
The consolidation scope of the consolidated financial statements is determined on the basis of control, including the company and the subsidiaries controlled by the company. Control means that the group has the power over the investee, enjoys variable returns through participating in relevant activities of the investee, and is able to use the power over the investee to affect its return amount. When judging whether the group has power over the investee, the group only considers the substantive rights related to the investee (including the substantive rights enjoyed by the group itself and other parties). The financial position, operating results and cash flow of subsidiaries are included in the consolidated financial statements from the control start date to the control end date.
The equity, profit and loss and total comprehensive income attributable to minority shareholders of subsidiaries are listed separately after the shareholders’ equity in the consolidated balance sheet and the net profit and total comprehensive income in the consolidated income statement.
If the current loss shared by minority shareholders of a subsidiary exceeds the share of minority shareholders in the owner’s equity of the subsidiary at the beginning of the period, the balance shall still be offset against the reduced shareholder’s equity.
When the accounting period or accounting policy adopted by the subsidiary is inconsistent with that of the company, necessary adjustments have been made to the financial statements of the subsidiary according to the accounting period or accounting policy of the company at the time of merger. At the time of consolidation, all intra group transactions and balances, including unrealized internal transaction gains and losses, have been offset. For the unrealized loss of intra group transactions, if there is evidence that the loss is the impairment loss of relevant assets, the loss shall be recognized in full.
(2) Subsidiaries acquired through merger
For subsidiaries acquired through business combination under the same control, when preparing the consolidated current financial statements, based on the book value of various assets and liabilities of the consolidated subsidiaries in the financial statements of the final controller, it is deemed that the consolidated subsidiaries are included in the consolidation scope of the company when the final controller of the company begins to control them, The opening balance of the consolidated financial statements and the comparative statements of the previous period shall be adjusted accordingly.
For subsidiaries acquired through business combination not under the same control, when preparing the consolidated financial statements of the current period, the purchased subsidiaries shall be included in the consolidation scope of the company from the acquisition date on the basis of the fair value of all identifiable assets and liabilities of the purchased subsidiaries determined on the acquisition date.
(3) Disposal of subsidiaries
When the group loses control over its original subsidiaries, any disposal gains or losses arising therefrom shall be included in the investment income of the current period when the control is lost.
If the long-term equity investment in a subsidiary is disposed step by step through multiple transactions until the control right is lost, it shall be judged whether it is a package deal according to the following principles:
-These transactions are concluded at the same time or in consideration of mutual influence;
-These transactions as a whole can achieve a complete business result;
-The occurrence of one transaction depends on the occurrence of at least one other transaction;
-A transaction is uneconomic when considered alone, but it is economical when considered together with other transactions.
If each transaction is not a package deal, all transactions before the loss of control over the subsidiary shall be treated in accordance with the accounting policy of partial disposal of equity investment in the subsidiary without loss of control (see note III, 6 (4)).
If each transaction is a package deal, it shall be treated as a transaction to dispose of the original subsidiary and lose control. Before losing control, the difference between each disposal price and the share of the book value of the net assets of the subsidiary continuously calculated from the purchase date corresponding to the disposal investment shall be included in other comprehensive income in the consolidated financial statements, When the control right is lost, it shall be transferred into the profits and losses of the current period when the control right is lost.
(4) Changes in minority interests
The difference between the cost of long-term equity investment newly obtained by the company due to the purchase of minority equity and the share of net assets of subsidiaries calculated according to the newly increased shareholding ratio, and the difference between the disposal price obtained due to the partial disposal of equity investment in subsidiaries and the net assets of subsidiaries corresponding to the disposal of long-term equity investment without losing control, Adjust the capital reserve (capital stock premium) in the consolidated balance sheet. If the capital reserve (capital stock premium) is insufficient to offset, adjust the retained earnings.
7. Criteria for determining cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits that can be used for payment at any time, and investments with short holding period, strong liquidity, easy conversion to known amount of cash and low risk of value change.
8. Foreign currency transactions and translation of foreign currency statements
When the group receives the capital invested by investors in foreign currency, it shall be converted into RMB at the spot exchange rate of the day, and other foreign currency transactions shall be converted into RMB at the spot exchange rate of the transaction date at the time of initial recognition.
On the balance sheet date, foreign currency monetary items are translated at the spot exchange rate on that date. Except for the exchange differences of the principal and interest of special borrowings related to the acquisition and construction of assets eligible for capitalization (see note III and 15), other exchange differences are included in the current profit and loss. Foreign currency non monetary items measured at historical cost are still translated at the spot exchange rate on the transaction date. Foreign currency non monetary items measured at fair value are translated at the spot exchange rate on the date when the fair value is determined. The resulting exchange difference belongs to the difference of equity instrument investment measured at fair value and its changes are included in other comprehensive income, which is included in other comprehensive income; Other differences are included in current profits and losses.
yes
