Ledman Optoelectronic Co.Ltd(300162)
Audit report
Dxsz [2022] No. 500014
Daxin Certified Public Accountants (special general partnership)
WUYIGE CERTIFIED PUBLIC ACCOUNTANTS LLP.
Wuyige certified public accountants LLP telephone: + 86 (10) 8233055822 / F, Xueyuan International Tower, No. 1 Zhichun Road, Haidian District, Beijing Fax: + 86 (10) 82327668 No.1 Zhichun Road, Haidian dist, 22nd floor, College International Building. Website: Internet: www.daxincpa com. cn. Postal Code: Beijing, China 100083
audit report
Dxsz [2022] No. 500014 Ledman Optoelectronic Co.Ltd(300162) all shareholders:
1、 Audit opinion
We have audited the financial statements of Ledman Optoelectronic Co.Ltd(300162) (hereinafter referred to as "the company"), including the consolidated and parent company's balance sheet as of December 31, 2021, the consolidated and parent company's income statement, consolidated and parent company's cash flow statement, consolidated and parent company's statement of changes in shareholders' equity and notes to financial statements in 2021.
In our opinion, the attached financial statements are prepared in accordance with the provisions of the accounting standards for business enterprises in all material aspects, and fairly reflect the financial position of your company as of December 31, 2021 and the operating results and cash flows of your company and the parent company 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 your company 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 current 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.
(I) goodwill impairment test
1. Item description
By the end of 2021, as stated in "III. accounting policies described in important accounting policies and accounting estimates (XIX)" and "v. notes to important items of consolidated financial statements (XVI) goodwill" in the notes to your company's financial statements, the goodwill account of consolidated financial statements
Wuyige certified public accountants LLP telephone: + 86 (10) 82330558
22 / F, Xueyuan International Tower, No. 1 Zhichun Road, Haidian District, Beijing Fax: + 86 (10) 82327668 no.1zhichun Road, Haidian dist, 22F, College International Building. Website: www.daxincpa com. cn. Postal Code: Beijing, China 100083
The face balance is 2229017 million yuan, the provision for impairment of goodwill is 1771347 million yuan, and the book value of goodwill is 45.767 million yuan. Your company needs to conduct impairment test on goodwill at the end of each year. The impairment test requires to estimate the recoverable amount of the relevant asset group including goodwill, that is, the higher of the net amount of the fair value of the relevant asset group minus the disposal expenses and the present value of the estimated future cash flow of the relevant asset group. When determining the present value of the estimated future cash flow of the relevant asset group, your company needs to properly predict the future income growth rate and the subsequent expected income growth rate, gross profit margin and discount rate of the relevant asset group, which involves the management of your company (hereinafter referred to as the management) using significant accounting estimates and judgments. For significant goodwill at the end of the period, the management employs external valuation experts to calculate the present value of the estimated future cash flow of each relevant asset group based on the cash flow forecast prepared by the management and the discounted model of the estimated future cash flow. As the amount of goodwill is large and involves the use of significant management judgment and estimation, we determine goodwill and impairment test as key audit matters.
2. Audit response
For the goodwill impairment test, our main audit procedures include:
(1) We understand and evaluate the management's identification of each asset group and how goodwill is allocated to each asset group;
(2) We understand and evaluate the professional competence and independence of external valuation experts employed by the management;
(3) We obtain the approved 2022 financial budget, compare it with the 2022 data predicted by the management, and evaluate the rationality of its prediction;
(4) We compare the audit results of relevant asset groups in 2021 with the forecasts of previous years to evaluate the reliability of the management's forecasts;
(5) We compare the key assumptions made by the management, such as the predicted growth rate of revenue and the predicted gross profit margin, with the historical data to evaluate the rationality of their assumptions;
(6) We calculate the discount rate based on the data of comparable listed companies and compare it with the discount rate adopted by the management;
(7) We compare the performance commitment and performance forecast with the company's realized performance, judge its completion, and evaluate the results of goodwill impairment test.
(II) inventory
1. Item description
By the end of 2021, as stated in the notes "III. accounting policies described in important accounting policies and accounting estimates (XI)" and "v. notes to important items in consolidated financial statements (IX) inventory" to your company's financial statements, the book balance of inventory was 4694068 million yuan, the balance of inventory falling price reserves was 604262 million yuan, and the book value of inventory was 4089806 million yuan, an increase respectively over the end of last year
Wuyige certified public accountants LLP telephone: + 86 (10) 82330558
22 / F, Xueyuan International Tower, No. 1 Zhichun Road, Haidian District, Beijing Fax: + 86 (10) 82327668 no.1zhichun Road, Haidian dist, 22F, College International Building. Website: www.daxincpa com. cn. Postal Code: Beijing, China 100083
Increased by 31.97%, - 18.01% and 45.03%.
The amount of your company's inventory is significant and changes greatly. Whether the provision for inventory falling price is sufficient has a great impact on the financial statements. At the same time, your company's management needs to use significant judgment when determining the net realizable value of inventory. Therefore, we determine your company's inventory as a key audit event.
2. Audit response
Our audit procedures for your company's inventory include but are not limited to the following main procedures:
(1) Understand and evaluate whether the design of key internal control related to inventory management is reasonable, and test whether the operation is effective;
(2) Obtain the inventory list, implement the inventory supervision procedure, and check the quantity and status of the inventory;
(3) Obtain the inventory age list at the end of the period, and analyze and review the inventory with a long age to evaluate the rationality of the provision for inventory falling price;
(4) Analyze the changes of inventory and perform valuation test on main inventory to check the accuracy of inventory carry forward operating cost; (5) Combined with the audit of accounts payable, select major suppliers to confirm the ending balance by letter;
(6) Implement inspection and confirmation procedures for the main issued commodities;
(7) Analyze and check the price changes of main products and main raw materials;
(8) Obtain the inventory falling price provision table and sales price policy documents, review the net realizable value of inventory and the amount of inventory falling price provision determined by the company's management, and check whether the provision method is implemented in accordance with the accounting policy.
(III) provision for bad debts of accounts receivable
1. Item description
By the end of 2021, as stated in the notes "III. accounting policies and accounting estimates (IX) and (x)" and "v. notes to important items of consolidated financial statements (V) accounts receivable" to your company's financial statements, the balance of accounts receivable was 3612404 million yuan, the amount of bad debt reserves of accounts receivable was 810161 million yuan, and the book value of accounts receivable was 2802243 million yuan. Bad debt provision policy and situation: the management shall conduct impairment test separately for accounts receivable with significant single amount and accounts receivable with insignificant single amount and the provision for bad debt according to the combination can not reflect its risk characteristics, and withdraw bad debt provision according to the difference between the present value of estimated future cash flow and its book value. In addition to the accounts receivable for which bad debt reserves have been separately accrued, the management mainly determines the accounts receivable portfolio based on the aging as the credit risk characteristics, and determines the bad debt reserves to be accrued based on the actual loss rate of the accounts receivable portfolio with similar credit risk characteristics in previous years and in combination with the current situation. As the book value of accounts receivable is significant, and the management needs to make significant judgment when determining the bad debt provision of accounts receivable, if the accounts receivable cannot be recovered on schedule
Wuyige certified public accountants LLP telephone: + 86 (10) 8233055822 / F, Xueyuan International Tower, No. 1 Zhichun Road, Haidian District, Beijing Fax: + 86 (10) 82327668 No.1 Zhichun Road, Haidian dist, 22nd floor, College International Building. Website: Internet: www.daxincpa com. cn. Postal Code: Beijing, China 100083
Or uncollectible bad debts have a significant impact on the financial statements. Therefore, we determine the bad debt provision of accounts receivable as a key audit event.
2. Audit response
For the bad debt provision of accounts receivable, we designed and implemented the following audit procedures:
(1) Evaluated and tested the design and operation effectiveness of the company's credit policy and internal control related to accounts receivable management;
(2) Analyze the rationality of the accounting estimation of the company's accounts receivable bad debt reserves, including the basis of accounts receivable combination, judgment of significant amount, judgment of separate provision for bad debt reserves, etc;
(3) Analyze and calculate the ratio between the amount of bad debt provision and the balance of accounts receivable on the balance sheet date of the company, compare the amount of bad debt provision in the previous period with the actual amount, and analyze the adequacy of bad debt provision of accounts receivable;
(4) Analyze the aging of accounts receivable and customer reputation, implement the letter of confirmation procedure of accounts receivable and the collection after the inspection period, and evaluate the rationality of bad debt provision;
(5) Obtain the bad debt provision accrual table and check whether the accrual method is implemented in accordance with the bad debt policy; Recalculate the accuracy of the amount of bad debt provision;
(6) Check the public information of major customers and purchasing suppliers to identify whether there is an association relationship; Compare the customer and supplier information to determine whether the same company is both a customer and a supplier.
4、 Other information
The management of your company (hereinafter referred to as the management) is responsible for other information. Other information includes the information covered in your 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.
Wuyige certified public accountants LLP telephone: + 86 (10) 82330558
