China Communications Construction Company Limited(601800) audited financial statements for 2021
catalogue
Page audit report 1-5 audited financial statements
Consolidated balance sheet 6-8 consolidated income statement 9-10 consolidated statement of changes in shareholders’ equity 11-12 consolidated cash flow statement 13-14 company balance sheet 15-17 company’s income statement 18 company’s statement of changes in shareholders’ equity 19-20 company’s cash flow statement 21-22 notes to financial statements 23-307 supplementary information
1. Detailed statement of non recurring profit and loss 308 2 Return on net assets and earnings per share 309.3 Reconciliation of differences between China and IFRS 310
audit report
Ernst & Young Huaming (2022) Shen Zi No. 60900316a01 China Communications Construction Company Limited(601800) China Communications Construction Company Limited(601800) all shareholders:
1、 Audit opinion
We have audited the financial statements of China Communications Construction Company Limited(601800) , including the consolidated and company’s balance sheet as of December 31, 2021, the consolidated and company’s income statement, the statement of changes in shareholders’ equity, the cash flow statement and the notes to relevant financial statements in 2021.
In our opinion, the attached financial statements of China Communications Construction Company Limited(601800) are prepared in accordance with the accounting standards for business enterprises in all major aspects and fairly reflect the consolidated and company’s financial position as of December 31, 2021 and the consolidated and company’s operating results and cash flow 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. In accordance with the code of professional ethics for Chinese certified public accountants, we are independent of China Communications Construction Company Limited(601800) , 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
Key audit matters are the most important matters that we consider to be the audit of this year’s financial statements according to our professional judgment. The response to these matters is based on the overall audit of the financial statements and the formation of audit opinions. We will not express separate opinions on these matters. Our description of how to deal with each of the following matters in the audit is also against this background.
We have fulfilled the responsibilities described in the “responsibilities of certified public accountants for the audit of financial statements” section of this report, including those related to these key audit matters. Accordingly, our audit work includes the implementation of audit procedures designed to deal with the risk of material misstatement of the assessed financial statements. The results of our audit procedures, including the procedures for the following key audit matters, provide a basis for our overall audit opinion on the financial statements.
Audit report (Continued)
Ernst & Young Huaming (2022) Shen Zi No. 60900316a01 China Communications Construction Company Limited(601800) III. key audit matters (Continued)
Key audit matters how to deal with them in the audit
Revenue recognition of construction contract China Communications Construction Company Limited(601800) revenue mainly comes from our evaluation and test of the construction contract that China Communications Construction Co., Ltd. recognizes revenue according to the performance progress. The internal control of the revenue recognition process of the company according to the performance, including the recognition of revenue according to the progress of the contract, involves the preparation of the expected revenue of the contract, the expected revenue of the contract and the expected cost of the contract, as well as the major judgment and estimation of the expected cost of performance, including the internal control of the management in calculating the revenue according to the progress; During the execution of major construction contracts, it is selected to continuously review the key contract terms based on the contract delivery scope and contract manufacturing, and check the estimated contract revenue, contract accrued revenue and contract estimated cost due to the factors such as the expected unfinished cost of the contract; The relevant estimated costs were assessed and revised by sampling inspection.
In addition, the contract costs incurred due to the verification of documents; After the deadline change is implemented, the estimated contract revenue and estimated contract cost will be compared with the test procedure to check whether the relevant contract costs are recorded and whether the original estimates have changed (sometimes it may be significant and recorded in the appropriate accounting period; according to the sum of the costs incurred). The estimated contract cost recalculates the performance progress and income; The analysis process is implemented for the gross profit margin of major construction contracts. See the sequence for the accounting policies and disclosure information for the recognition of construction contract revenue. Notes III, 24 and 36, notes V and 50 and notes XV and 10 to the financial statements. Expected credit loss of contract assets, accounts receivable and long-term receivables impairment provision of contract assets, accounts receivable and long-term receivables we evaluated and tested the recognition of China Communications Construction Co., Ltd. on the basis of expected credit loss, involving significant judgment and estimation of the company’s contract assets, accounts receivable and long-term accounts receivable China Communications Construction Company Limited(601800) management’s internal control over the impairment provision process; Reviewed the management’s analysis of the historical collection of accounts receivable and long-term accounts receivable, the historical collection of accounts receivable and long-term accounts receivable and the historical settlement of contract assets, and the analysis of the historical settlement of credit contract assets of the counterparty; For the selected service level and future economic situation, evaluate the contract assets, sample and check the relevant documents to review the credit risk of aging accounts receivable and long-term accounts receivable. Accuracy; Evaluated the management’s assessment of the credit risk of contract assets, accounts receivable and long-term accounts receivable. See notes III, 9 and 36, notes V, 4, 9, 12 and 24 and notes XV and 2 of the financial statements for the accounting policies and disclosure information of impairment provision for contract assets, accounts receivable and long-term receivables.
Audit report (Continued)
Ernst & Young Huaming (2022) Shen Zi No. 60900316a01 China Communications Construction Company Limited(601800) III. key audit matters (Continued)
Franchise impairment test
For franchise assets with signs of impairment, we evaluated and tested the internal of the impairment test process of franchise assets carried out by the management of China Communications Construction Co., Ltd. to determine the recoverable amount of relevant franchise assets. Control; The recoverable amount of the exclusive franchise assets of the external experts hired by the management is evaluated. Through the competency, professional quality and objectivity of the cash flow industry, the discount method is determined, which involves significant judgment and estimation. According to the procedures implemented by China Communications Construction Co., Ltd., the appropriateness of relevant supporting evidence used by the management of China Communications Construction Co., Ltd. to estimate the future traffic in the process of implementing the procedures is evaluated; The company has assessed the amount, operating cost and the recoverable amount of assets based on and assumed in the future cash flow forecast by adopting a reasonable discount rate. Reasonableness, including the expected future traffic volume, the operation status of franchise assets, the accounting policies for the provision for impairment of these franchise rights and the development plan of the operation area of the disclosed information assets; Compare the forecast in notes 3, 18 and 36 and note 5 of the financial statements of previous years with the actual performance in 2021; 20。 The rationality of cash flow discount rate is evaluated.
4、 Other information
China Communications Construction Company Limited(601800) management is responsible for other information. Other information includes the information covered in the 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
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 caused by fraud or error.
When preparing the financial statements, the management is responsible for assessing China Communications Construction Company Limited(601800) ‘s ability to continue as a going concern, disclosing matters related to going concern (if applicable), and applying the assumption of going concern, unless liquidation is planned, operation is terminated or there is no other realistic choice.
The management is responsible for supervising the financial reporting process of China Communications Construction Company Limited(601800) .
Audit report (Continued)
Ernst & Young Huaming (2022) Shen Zi No. 60900316a01 China Communications Construction Company Limited(601800) VI. 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. Since fraud may involve collusion, forgery, intentional omission, misrepresentation or override of internal control, the risk of failing to find major misstatement caused by fraud is higher than that caused by error.
(2) Understand the internal control related to audit to design appropriate audit procedures.
(3) Evaluation management
