Baoding Lucky Innovative Materials Co.Ltd(300446)
Financial report for 2021
April 2022
financial reports
1、 Audit report
Unqualified opinion of audit opinion type standard
Signing date of audit report: April 15, 2022
Name of audit institution: Zhitong Certified Public Accountants (special general partnership)
Audit Report No.: ztsz (2022) No. 110a010292
Name of certified public accountant: Wang Hongli, Dong Li
Body of audit report
audit report
Zhi Tong Shen Zi (2022) No. 110a010292 Baoding Lucky Innovative Materials Co.Ltd(300446) all shareholders:
1、 Audit opinion
We have audited the financial statements of Baoding Lucky Innovative Materials Co.Ltd(300446) (hereinafter referred to as lucky new material), including the consolidated and company's balance sheet as of December 31, 2021, the consolidated and company's income statement, consolidated and company's cash flow statement, consolidated and company's statement of changes in shareholders' equity and notes to relevant financial statements in 2021.
In our opinion, the attached financial statements are prepared in accordance with the accounting standards for business enterprises in all material 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 lucky new materials 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) revenue recognition
See notes III, 24 and V, 33 of the financial statements for relevant information disclosure.
1. Item description
Lucky new materials is mainly engaged in the production and sales of information anti-counterfeiting materials, electronic functional materials and fine chemical materials. In 2021, the operating revenue was 1530943 million yuan, an increase of 16.82% over the previous year. As lucky new material is currently in the state of being implemented with "delisting risk warning", revenue is one of the key indicators for lucky new material to revoke the "delisting risk warning", and revenue is one of the key performance indicators of lucky new material. There may be an inherent risk that lucky new material management (hereinafter referred to as management) manipulates revenue recognition in order to achieve specific goals or expectations. Therefore, we identify revenue recognition as a key audit matter.
2. Audit response
For revenue recognition, we have mainly implemented the following audit procedures:
(1) Understand and evaluate the design of internal control related to revenue cycle, and test whether key internal control operates effectively; (2) Obtain the sales contract signed between lucky new material and the customer, check the key terms such as contract delivery, acceptance, payment and settlement, and ask the management to evaluate whether the revenue recognition policy is in line with the provisions of the accounting standards for business enterprises
(3) Compare the current operating income and gross profit margin of important products with the previous period, analyze whether the product sales structure and price changes are abnormal, and check the reasons for the abnormal changes;
(4) Check the sales contract, sales order, delivery note, waybill, sales invoice and other important credentials related to the revenue confirmation of lucky new materials, for export business, check the export declaration form, bill of lading and other important credentials, check the customs E-port data, query the customs declaration information through the official website of the General Administration of customs, and check whether the recorded amount of sales revenue is accurate;
(5) Combined with the audit procedures of accounts receivable, select samples and send letters to customers to confirm the ending balance and current transaction amount of accounts receivable;
(6) Check the gross profit margin of related party transactions and analyze the fairness of related party transactions;
(7) Perform a cut-off test on the sales revenue before and after the balance sheet date to verify whether the sales revenue is recorded in the appropriate accounting period.
(II) provision for impairment of fixed assets
See notes III and 14 and notes V and 10 of the financial statements for relevant information disclosure.
1. Item description
As of December 31, 2021, the net book value of fixed assets of lucky new material was 213865000 yuan, the provision for impairment of fixed assets was 13761200 yuan, and the book value of fixed assets was 200103800 yuan. Rakay new materials shall measure the ending value of fixed assets according to the lower of the book value of assets and recoverable amount. As the provision for impairment of fixed assets requires significant judgment by the management, we recognize the provision for impairment of fixed assets as a key audit event.
2. Audit response
For the provision for impairment of fixed assets, we mainly implemented the following audit procedures:
(1) Understand and evaluate the internal control design related to the impairment test of fixed assets, and test the effective operation of key internal controls;
(2) Implement supervision procedures for fixed assets and check the status of fixed assets on the spot;
(3) Understand and evaluate the management's judgment on the signs of impairment of fixed assets and its basis;
(4) Obtain and view the evaluation report on the benchmark date of the impairment test and evaluation of fixed assets of lucky new materials, understand the important assumptions, valuation methods and the selection of important parameters in the asset evaluation report, and review the rationality of the evaluation results;
(5) Evaluate the competence, professional quality and objectivity of appraisers;
(6) Review the accounting treatment and disclosure of the provision for impairment of fixed assets of lucky new materials.
4、 Other information
The management of lucky new materials is responsible for other information. Other information includes the information covered in the 2021 annual report of lucky new material, 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 of lucky new materials 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 to ensure 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 lucky new material, disclosing matters related to sustainable operation (if applicable), and applying the assumption of sustainable operation, unless the management plans to liquidate lucky new material, terminate operation or has no other realistic choice.
The management is responsible for supervising the financial reporting process of lucky new materials.
6、 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. The risk of fraud, collusion or failure to control may be higher than that caused by the discovery of material misstatement or fraud.
(2) Understand the internal control related to audit in order to design appropriate audit procedures, but the purpose is not to express an opinion on the effectiveness of internal control.
(3) Evaluate the appropriateness of accounting policies selected by the management and the rationality of accounting estimates and related disclosures.
(4) Draw conclusions on the appropriateness of management's use of going concern assumptions. 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 lucky new materials. 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 lead to the non sustainable operation of lucky new materials.
(5) Evaluate the overall presentation, 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 lucky new materials to express an 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 the most important for the audit of the current financial statements, 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. 2、 The unit of the statement in the financial notes to the financial statements is: yuan 1. The preparation unit of the consolidated balance sheet is Baoding Lucky Innovative Materials Co.Ltd(300446)
December 31, 2021
Unit: Yuan
December 31, 2021 December 31, 2020
Current assets:
Monetary capital 40105502966313637503
Provision for settlement
Lending funds
Trading financial assets 1491355179829211031310
Derivative financial assets
Notes receivable 9962550073479510
Accounts receivable 24906972042805905116
Receivables financing 373693788325758356
Prepayment 428472456317828535
receivable premium
accounts receivable reinsurance
Reinsurance contract reserve receivable
Other receivables
