Securities abbreviation: Eternal Asia Supply Chain Management Ltd(002183) securities code: Eternal Asia Supply Chain Management Ltd(002183) Announcement No.: 2022045 Eternal Asia Supply Chain Management Ltd(002183)
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.
Eternal Asia Supply Chain Management Ltd(002183) (hereinafter referred to as “the company”) deliberated and adopted the proposal on the provision for asset impairment in 2021 at the 67th meeting of the sixth board of directors and the annual meeting of 2021 held on April 7, 2022. The provision for asset impairment does not need to be submitted to the general meeting of shareholders for deliberation. The specific contents are as follows:
1、 Overview of the provision for asset impairment this time
In accordance with the requirements of the accounting standards for business enterprises and the guidelines for self regulation and supervision of listed companies of Shenzhen Stock Exchange No. 1 – standardized operation of listed companies on the main board, the company analyzes the assets within the scope of the consolidated statements based on the principle of prudence, and withdraws the corresponding impairment reserves for the assets with signs of impairment.
The company has conducted impairment tests on receivables, inventories, long-term equity investments, investment real estate, fixed assets, intangible assets, goodwill, loans and advances and other assets by the end of 2021. It is judged that there are signs of impairment and impairment reserves need to be withdrawn. The company’s asset items for which the provision for asset impairment is made this time mainly include accounts receivable, inventory, goodwill, loans and advances and long-term equity investment, and the provision for asset impairment is 361.8 million yuan.
The details of the provision for impairment of various assets withdrawn this time are as follows:
Unit: 10000 yuan
Provision for the current period of the project
1、 Bad debt provision 28831
Including: accounts receivable 18973
Other receivables 9604
Impairment loss of notes receivable 254
2、 Inventory falling price reserves 1694
3、 Provision for impairment of goodwill 22
4、 Provision for impairment of loans and advances 3709
5、 Provision for impairment of long-term equity investment 1924
Total 36180
2、 Description of provision for asset impairment
(I) accounts receivable
The company shall separately determine the credit loss of accounts receivable with significantly increased credit risk.
When there is no sufficient evidence to evaluate the expected credit loss at a reasonable cost at the level of single instrument, the company refers to the experience of historical credit loss, combined with the current situation and the judgment of future economic conditions, divides the accounts receivable 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:
Combination name: basis for determining combination and accrual method
Aging analysis method accounts receivable with the same aging of combined supply chain business have similar credit risk, and are withdrawn according to the aging and the expected characteristic loss rate of credit insurance in the whole duration
With reference to the experience of historical credit loss, the bad debt provision is measured in combination with the situation before the related parties within the combined scope of related parties have similar credit risk characteristics and the expectation of future economic conditions
The accounts receivable of other portfolio engineering businesses have similar credit risk characteristics and are withdrawn with reference to the historical credit loss rate
The company shall separately determine the credit loss of other receivables with significantly increased credit risk.
When there is no sufficient evidence to evaluate the expected credit loss at a reasonable cost at the level of single instrument, the company refers to the experience of historical credit loss, combined with the current situation and the judgment of future economic conditions, divides other 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:
Combination name: basis for determining combination and accrual method
The aging analysis method combines other receivables with the same aging and has similar credit risk characteristics. It is withdrawn according to the aging and expected credit loss rate, with reference to historical credit loss experience, The bad debt provision shall be measured in combination with the situation before the related parties within the combination scope of related parties have similar credit risk characteristics and the expectation of future economic conditions
Employees’ borrowings, reserves, deposits and deposits have similar credit reference historical credit loss experience, and bad debt reserves are measured in combination with the situation before the risk-free portfolio risk characteristics and the expectation of future economic conditions
In 2021, the company made bad debt provision of 189.73 million yuan for accounts receivable, 96.04 million yuan for other accounts receivable and 2.54 million yuan for impairment of notes receivable, totaling 288.31 million yuan.
（2） Stock
Withdrawal method of inventory falling price reserves: after a comprehensive inventory of inventories at the end of the period, the inventory falling price reserves shall be withdrawn or adjusted according to the lower of inventory cost and net realizable value.
At the end of the period, the inventory falling price reserves are accrued according to a single inventory item; However, for the inventory with large quantity and low unit price, the inventory falling price reserves shall be withdrawn according to the inventory category; If the inventories are related to the product series produced and sold in the same region, have the same or similar end use or purpose, and are difficult to be measured separately from other items, the inventory falling price reserves shall be accrued jointly.
If the factors affecting the previous write down of inventory value have disappeared, the amount of write down shall be restored and reversed within the amount of inventory falling price reserve originally withdrawn, and the reversed amount shall be included in the current profit and loss.
The company has conducted impairment test on various inventories. According to the test results, the provision for falling price of various inventories is 16.94 million yuan in 2020.
(III) Goodwill
In order to truly reflect the asset value and financial status of the company, according to the accounting standards for business enterprises and the company’s accounting policies and other relevant provisions, the company conducted an impairment test on the relevant assets or asset portfolio containing goodwill. After the test, the goodwill impairment of 220000 yuan was accrued at the end of the reporting period.
(IV) loans and advances
The company shall separately determine the credit loss of loans and advances with significantly increased credit risk.
When there is no sufficient evidence to evaluate the expected credit loss at a reasonable cost at the level of single instrument, the company divides the loans and advances into several combinations according to the characteristics of credit risk with reference to the experience of historical credit loss and mortgage guarantee, combined with the current situation and the judgment of future economic conditions, and calculates the expected credit loss on the basis of the combination. The basis for determining the combination is as follows:
Combination name: basis for determining combination and accrual method
The loans and advances of the same category in the five level classification portfolio have similar credit risk characteristics according to the risk category and expected credit loss rate
Accrual
The company conducted impairment test on all loans issued. According to the test results, the provision for impairment of all loans issued was 37.09 million yuan in 2021.
(V) long term equity investment
According to the accounting standards for business enterprises, the company’s accounting policies and other relevant provisions, the company fully analyzes and evaluates the long-term equity investment. According to the evaluation results, the company accrues impairment reserves for the difference between the recoverable amount of the long-term equity investment and its book value. At the end of the reporting period, the provision for impairment of long-term equity investment was 19.24 million yuan. 3、 The impact of the current provision for asset impairment on the company
The provision for impairment of the above assets is 361.8 million yuan, which is included in the company’s profit and loss in 2021. The company’s provision for asset impairment this time has not been audited by an accounting firm, and the final data shall be subject to the financial data audited by the accounting firm.
It is hereby announced.
Eternal Asia Supply Chain Management Ltd(002183) board of directors April 7, 2022
