Securities code: Jsti Group(300284) securities abbreviation: Jsti Group(300284) Announcement No.: 2022016 Jsti Group(300284)
Announcement on 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.
Jsti Group(300284) (hereinafter referred to as “the company”) held the 5th meeting of the 5th board of directors and the 4th meeting of the 5th board of supervisors on April 17, 2021, and deliberated and adopted the proposal on the provision for asset impairment in 2021 (this proposal still needs to be submitted to the 2021 general meeting of shareholders of the company for deliberation). The relevant information is hereby announced as follows:
1、 Overview of the provision for asset impairment this time
1. Reasons for withdrawing asset impairment provision this time
In accordance with the accounting standards for business enterprises and the company’s financial rules and regulations, based on the principle of prudence, the company has conducted a comprehensive inventory of accounts receivable, other accounts receivable, inventory, fixed assets, construction in progress, intangible assets, goodwill and other assets within the scope of consolidated statements as of December 31, 2021, including the possibility of recovery of accounts receivable, net realizable value of inventory, fixed assets, construction in progress The recoverable amount of intangible assets and goodwill has been fully evaluated and analyzed. According to the evaluation and analysis results, the company and its subsidiaries have made a comprehensive inventory and asset impairment test of assets with possible signs of impairment at the end of 2021 (including accounts receivable, other accounts receivable, inventory and intangible assets), and accrued a total of 40973527623 yuan of asset impairment reserves in 2021. The details are as follows:
Credit impairment loss unit: Yuan
Amount incurred in current period and amount incurred in previous period
Bad debt loss of accounts receivable -22455534168 -37418127930
Bad debt loss of other receivables 820324378 -1614565134
Total -21635209790 -39032693064
Asset impairment loss unit: Yuan
Amount incurred in current period and amount incurred in previous period
Impairment loss of contract assets -16774927833 -2178216697
Goodwill impairment loss -2563390000 -2705373940
Total -19338317833 -4883590637
2、 The recognition standard and withdrawal method of the provision for asset impairment this time
(I) recognition standard and withdrawal method of bad debt provision for accounts receivable
The accounts receivable of the company mainly include notes receivable, accounts receivable, accounts receivable financing, other receivables, debt investment, other debt investment and long-term receivables.
For the receivables and lease receivables arising from the sale of products or the provision of labor services, the company measures the loss reserves according to the amount equivalent to the expected credit loss in the whole duration.
For other types of receivables, the company assesses whether the credit risk of a financial instrument has increased significantly since the initial recognition on each balance sheet date. If the default probability of a financial instrument within the expected duration determined on the balance sheet date is significantly higher than that within the expected duration determined at the initial recognition, it indicates that the credit risk of the financial instrument has increased significantly.
If the credit risk does not increase significantly after initial recognition and is in the first stage, the company measures the loss reserve according to the amount of expected credit loss in the next 12 months; If the credit risk has increased significantly since the initial recognition, but there is no credit impairment, and it is in the second stage, the company measures the loss reserve according to the amount equivalent to the expected credit loss in the whole duration; If the credit impairment of receivables has occurred since the initial recognition, it is in the third stage. The company measures the loss provision according to the expected credit loss of the whole duration.
For accounts receivable with low credit risk on the balance sheet date, the company assumes that its credit risk has not increased significantly since initial recognition, and measures the loss provision according to the expected credit loss in the next 12 months. 2) Accounts receivable that separately assess credit risk, such as accounts receivable from related parties; Receivables in dispute with the other party or involving litigation and arbitration; Receivables that have obvious signs that the debtor is likely to be unable to perform its repayment obligations.
In addition to the receivables that separately assess the credit risk, the company divides the receivables into different groups based on the common risk characteristics, and evaluates the credit risk on the basis of combination. Determination basis of different combinations:
The basis for determining the portfolio of projects and the method of measuring expected credit loss
With reference to the historical credit loss experience, combined with the current situation and the prediction of the economic situation of non bank acceptance bills, the expected credit loss is calculated through the default risk exposure and the renewal expected credit loss rate of the whole deposit and receivable bill portfolio.
Commercial acceptance bill
For those formed by providing labor services, we should refer to the historical credit loss experience with customers according to the product type, combined with the current situation and
The basis for determining the portfolio of projects and the method of measuring expected credit loss
The classification of accounts receivable is used to predict the economic situation, and the expected credit loss is calculated through the default risk exposure and the expected credit loss rate throughout the duration.
With reference to the experience of historical credit loss, combined with the current situation and the prediction of the economic situation formed by non project contracting, it should be divided by default risk exposure and the whole deposit and receipt type according to the product type and customer
Renew the expected credit loss rate and calculate the expected credit loss.
With reference to the experience of historical credit loss, combined with the current situation and the prediction of the economic situation of unsold goods according to the product type and customers, it is divided by default risk exposure and the whole type of deposits and receivables
Renew the expected credit loss rate and calculate the expected credit loss.
With reference to the experience of historical credit loss, combined with the current situation and the prediction of the economic situation of other accounts receivable portfolio according to the aging, the expected credit loss is calculated through the default risk exposure and the expected credit loss rate in the next 12 months or the whole duration.
With reference to the historical credit loss experience, combined with the current situation and the prediction of the economic situation of non long-term receivables according to the nature of investment, the expected credit loss is calculated through the default risk exposure and the expected credit loss rate for the whole duration.
For the accounts receivable divided into labor service provision, project contracting and commodity sales portfolio, the company refers to the historical credit loss experience, combined with the current situation and the prediction of future economic conditions, prepares the comparison table between the aging of accounts receivable and the expected credit loss rate throughout the duration, and calculates the expected credit loss.
(II) recognition standard and withdrawal method of inventory falling price reserves
On the balance sheet date, the company shall withdraw the inventory falling price reserve according to the difference between the cost of a single inventory (materials) and the net realizable value, and record it into the current profit and loss; If the factors affecting the previous write down of inventory value have disappeared, the amount of write down shall be restored and reversed from the amount of inventory falling price reserves that have been withdrawn, and the reversed amount shall be included in the current profits and losses. For inventories (materials and materials) with large quantity and low unit price, provision for inventory falling price shall be made according to the category of inventory (materials and materials).
(III) recognition standard and withdrawal method of impairment provision for contract assets
Contract assets of the company refer to the right to receive consideration for goods or services transferred to customers, and the right depends on other factors other than the passage of time. Depending on the lapse of time, the company only has the right to receive the accounts receivable from the customer as unconditional consideration.
The determination method and accounting treatment method of the expected credit loss of contract assets are consistent with the determination method and accounting treatment method of the expected credit loss of accounts receivable.
(IV) recognition standard and withdrawal method of long-term assets impairment provision
On the balance sheet date, the company determines whether there are signs of impairment of long-term assets such as long-term equity investment, investment real estate measured by cost mode, fixed assets, construction in progress, productive biological assets measured by cost mode, oil and gas assets and intangible assets according to internal and external information, and carries out impairment test on long-term assets with signs of impairment to estimate their recoverable amount. In addition, regardless of whether there is any sign of impairment, the company conducts impairment test on goodwill, intangible assets with uncertain service life and intangible assets that have not yet reached the serviceable state at least at the end of each year, and estimates their recoverable amount.
If the estimation result of the recoverable amount shows that the recoverable amount of the above long-term assets is lower than its book value, its book value will be written down to the recoverable amount, and the written down amount will be recognized as asset impairment loss and included in the current profit and loss, and the corresponding impairment provision will be withdrawn at the same time.
The recoverable amount refers to the higher one between the net amount of the fair value of the asset (or asset group, asset group combination, the same below) minus the disposal expenses and the present value of the expected future cash flow of the asset.
Asset group is the smallest asset portfolio that can be recognized, and its cash inflow is basically independent of other assets or asset groups. The asset group consists of assets related to the creation of cash inflows. When identifying the asset group, it mainly considers whether the asset group can generate cash inflow independently, and also considers the management method of production and operation activities and the decision-making method of asset use or disposal.
The net amount of the fair value of an asset minus the disposal expenses is determined according to the price that market participants can receive from the sale of an asset or need to pay for the transfer of a liability in an orderly transaction on the measurement date minus the amount that can be directly attributed to the disposal expenses of the asset. The present value of the estimated future cash flow of an asset is determined by selecting an appropriate pre tax discount rate according to the estimated future cash flow generated during the continuous use and final disposal of the asset.
The impairment loss related to the asset group or combination of asset groups shall first offset the book value of goodwill allocated to the asset group or combination of asset groups, and then offset the book value of other assets in proportion according to the proportion of the book value of other assets except goodwill in the asset group or combination of asset groups, However, the book value of each asset after deduction shall not be lower than the net amount of the fair value of the asset minus the disposal expenses (if determinable), the present value of the expected future cash flow of the asset (if determinable) and zero, whichever is the highest.
Once the aforesaid impairment loss of long-term assets is recognized, it shall not be reversed in subsequent accounting periods.
3、 The impact of the provision for asset impairment on the company’s financial position
After considering the impact of income tax and minority shareholders’ profits and losses, the net profit attributable to shareholders of Listed Companies in 2021 will be reduced by 279437404 yuan.
4、 Important tips
5、 Opinions of the board of directors
The board of directors of the company believes that the provision for asset impairment this time complies with the provisions of the accounting standards for business enterprises and the company’s financial rules and regulations, truly reflects the company’s financial situation and asset value, does not harm the interests of the company and shareholders, and does not involve the company’s affiliated units and related persons. It agrees to the provision for asset impairment this time
