The audited financial statements of Hubei Zhongyi Technology Co., Ltd. for 2018, 2019, 2020 and the six months ended June 30, 2021
catalogue
Page audit report 1 – 5 audited financial statements
Consolidated balance sheet 6 – 7 consolidated income statement 8
Consolidated statement of changes in shareholders’ equity 9 – 12 consolidated cash flow statement 13 – 14 company balance sheet 15 – 16 company income statement 17 company statement of changes in shareholders’ equity 18 – 19 cash flow statement of the company 20 – 21 notes to financial statements 22 – 143 supplementary information
1. Detailed statement of non recurring gains and losses 1
2. Return on net assets and earnings per share 2
audit report
Ernst & Young Huaming (2021) Shen Zi No. 61378651c02 Hubei Zhongyi Technology Co., Ltd. all shareholders of Hubei Zhongyi Technology Co., Ltd.:
1、 Audit opinion
We have audited the financial statements of Hubei Zhongyi Technology Co., Ltd., including the consolidated and company’s balance sheets as of December 31, 2018, December 31, 2019, December 31, 2020 and June 30, 2021, the consolidated and company’s income statement, statement of changes in shareholders’ equity, cash flow statement and notes to relevant financial statements for 2018, 2019, 2020 and the six months ended June 30, 2021.
In our opinion, the attached financial statements of Hubei Zhongyi Technology Co., Ltd. are prepared in accordance with the provisions of the accounting standards for business enterprises in all material aspects, and fairly reflect the consolidated and company financial status of Hubei Zhongyi Technology Co., Ltd. as of December 31, 2018, December 31, 2019, December 31, 2020 and June 30, 2021, as well as the financial statements of 2018, 2019 Business performance and cash flow of the company for the year 2020 and the six months ended June 30, 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 Hubei Zhongyi Technology Co., Ltd. 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
The key audit matters are the most important matters that we consider to audit the financial statements of 2018, 2019, 2020 and the six months ended June 30, 2021 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 (2021) Shen Zi No. 61378651c02 Hubei Zhongyi Technology Co., Ltd. III. key audit matters (Continued)
Key audit matters: how to deal with this matter in the audit:
Recognition of revenue from sales of goods in 2018, 2019, 2020 and the six-month period ending June 30, 2021 when we review the recognition of revenue from sales of goods, the consolidated financial accounting procedures include: the amount of revenue from sales of goods in the statements is (1) people’s (1) test and evaluate the design of key internal control related to the recognition of revenue from sales of goods of RMB Shenzhen Kingdom Sci-Tech.Ltd(600446) 48296 and RMB 82874832491 The effectiveness of the and operation of RMB;
116769905612 yuan and RMB (2) the sales of main customers through sampling inspection amounted to 95789816086 yuan.
The group’s revenue from the sale of goods is the same as the terms, so as to evaluate whether the management’s judgment on the main risks and rewards of the seller in the ownership of goods is appropriate; Confirm when reaching the customer. According to the relevant contract agreements, we confirm the sales volume and the balance of accounts receivable to the main customers as the sales revenue when the goods are signed by the customer. For the customers who do not reply, there may be a risk that the sales revenue is not confirmed during the current period by checking the sales contract, delivery order and sales. Therefore, we will issue the invoice The execution of alternative procedures such as customer receipt is identified as key audit matters. Order;
(3) Field visit to major customers;
Accounting policies for the recognition of sales revenue in the financial statements (4) select samples of sales revenue, see notes III, 21 and 22 and notes for policies and disclosure, and check the sales contract, sales delivery order, goods V and 36. Original documents such as signed receipt and sales invoice;
(5) Perform sales revenue cut-off test to evaluate whether the revenue is recognized in the appropriate accounting period;
(6) Perform analytical procedures.
Audit report (Continued)
Ernst & Young Huaming (2021) Shen Zi No. 61378651c02 Hubei Zhongyi Technology Co., Ltd. IV. 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 evaluating the sustainable operation ability of Hubei Zhongyi Technology Co., Ltd., disclosing matters related to sustainable operation (if applicable), and applying the assumption of sustainable operation, unless it plans to liquidate, terminate operation or has no other realistic choice.
The management is responsible for supervising the financial reporting process of Hubei Zhongyi Technology Co., Ltd.
5、 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 perform the following work: (1) identify and evaluate the risk 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) Evaluate the appropriateness of accounting policies selected by the management and the rationality of accounting estimates and related disclosures.
Audit report (Continued)
Ernst & Young Huaming (2021) Shen Zi No. 61378651c02 Hubei Zhongyi Technology Co., Ltd. v. responsibilities of certified public accountants for the audit of financial statements (Continued)
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 carried out the following work: (Continued) (4) draw a conclusion on the appropriateness of the going concern assumption used by the management. At the same time, according to the audit evidence obtained, draw a conclusion on whether there are major uncertainties in the matters or circumstances that may lead to major doubts about the sustainable operation ability of Hubei Zhongyi Technology Co., Ltd. If we conclude that there is significant uncertainty, the auditing standards require us to draw the attention of statement users to the relevant disclosures in the financial statements in the audit report; If the disclosure is insufficient, we should express a non unqualified opinion. Our conclusions are based on the information available as of the date of the audit report. However, future events or circumstances may cause Hubei Zhongyi Technology Co., Ltd. to be unable to continue its business. (5) Evaluate the overall presentation (including disclosure), structure and content of the financial statements, and evaluate whether the financial statements fairly reflect relevant transactions and events. (6) Obtain sufficient and appropriate audit evidence on the financial information of entities or business activities in Hubei Zhongyi Technology Co., Ltd., so as to express an audit opinion on the financial statements. We are responsible for guiding, supervising and implementing the group audit, and take full responsibility for the audit opinions.
We communicated with the management on the planned audit scope, schedule and major audit findings, including the internal control defects that we identified in the audit.
We also provide a statement to the management that we have complied with the professional ethics requirements related to independence, and communicate with the management all relationships and other matters that may reasonably be considered to affect our independence, as well as relevant preventive measures (if applicable).
From the matters communicated with the management, we determine which matters are most important for the audit of financial statements in 2018, 2019, 2020 and the six months ended June 30, 2021, thus constituting key audit matters. We describe these matters in the audit report, unless laws and regulations prohibit the public disclosure of these matters, or in rare cases, if the negative consequences of communicating a matter in the audit report are reasonably expected to exceed the benefits in the public interest, we determine that we should not communicate the matter in the audit report.
Audit report (Continued)
