Bohai Automotive Systems Co.Ltd(600960)
Consolidated and parent company financial statements in 2021
Audit report
Zhongxinghua Certified Public Accountants (special general partnership)
Zhongxinghuacitified publicaccountants LLP address: 20 / F, tower sohob, Lize, No. 20, Lize Road, Fengtai District, Beijing zip code: 100073 Tel: (010) 51423818 Fax: (010) 51423816
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Report title: Bohai Automotive Systems Co.Ltd(600960) 2021
Audit report on the financial statements of the company and the parent company
Report No.: zths Zi (2022) No. 030210
Customer Name: Bohai Automotive Systems Co.Ltd(600960)
Report date: April 22, 2022
Signed CPA: Li Jiangshan (CPA: 3702 Tcl Technology Group Corporation(000100) 15)
011092022042101820533
Ji Wanli (CPA: 110001673920) Report No.: Zhongxing Huashen Zi (2022) No. 030210 firm name: zhongxinghua Certified Public Accountants (special general accounting firm)
(partner)
Tel: 01051423818
Fax: 01051423816
Mailing address: Building 1, courtyard 20, Lize Road, Fengtai District, Beijing
20th floor, sohob block
E-mail: [email protected].
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catalogue
1、 Audit report II. Attachment of audit report
1. Consolidated and parent company's balance sheet
2. Consolidated and parent company income statement
3. Consolidated and parent company cash flow statement 4 Consolidated statement of changes in shareholders' equity 5 Statement of changes in shareholders' equity of the parent company 6 Note III to the financial statements and Annex 1 to the audit report Copy of business license of zhongxinghua Certified Public Accountants (special general partnership) 2 Copy of practicing certificate of zhongxinghua Certified Public Accountants (special general partnership) 3 Copy of certified public accountant's practice certificate
Zhongxinghua Certified Public Accountants (special general partnership) Z ho N G x i n g h u a c e r t i f i e d p u b l i c a c o u n t a n t s l p
Address (l o c a t i o n): floor 20, block B, Lize s o H O, No. 20, Lize Road, Fengtai District, Beijing
20/F,Tower B,Lize SOHO,20 Lize Road,Fengtai District,Beijing PR China
Tel (t e l): 0 1 0 - 5 1 4 2 3 8 1 8 fax (f a x): 0 1 0 - 5 1 4 2 3 8 1 6
Audit report
ZTE Huashen Zi (2022) No. 030210 Bohai Automotive Systems Co.Ltd(600960) all shareholders:
1、 Audit opinion
We have audited the financial statements of Bohai Automotive Systems Co.Ltd(600960) (hereinafter referred to as " Bohai Automotive Systems Co.Ltd(600960) 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 relevant 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 Bohai Automotive Systems Co.Ltd(600960) company as of December 31, 2021 and the operating results and cash flow of the 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 Bohai Automotive Systems Co.Ltd(600960) 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 opinions. We will not express separate opinions on these matters. We confirm that the following matters are the key audit matters that need to be communicated in the audit report.
(I) revenue recognition
See notes IV, 26 and VI, 43 to the financial statements for relevant information disclosure.
1. Item description
Zhongxinghua Certified Public Accountants (special general partnership)
Bohai Automotive Systems Co.Ltd(600960) company's operating income mainly comes from the production and sales of piston, aluminum structural parts of automobile, wheel hub and other auto parts. In 2021, the operating income of Bohai Automotive Systems Co.Ltd(600960) company was 441486010409 yuan.
As revenue is one of the key performance indicators of Bohai Automotive Systems Co.Ltd(600960) company, there may be inherent risks that the management may manipulate through inappropriate revenue recognition to achieve specific goals or expectations. Therefore, we identify revenue recognition as a key audit matter.
2. Audit response
(1) Understand the key internal controls related to revenue recognition, evaluate the rationality of these control designs, determine whether they have been implemented, and test the effectiveness of the implementation of relevant key internal controls;
(2) Through interviews with the management of Bohai Automotive Systems Co.Ltd(600960) company and sampling inspection of major sales contracts and key contract terms, analyze and evaluate the time point of control transfer related to revenue recognition, discuss and evaluate with the management whether the revenue recognition policy complies with the provisions of accounting standards for business enterprises;
(3) For domestic sales revenue, check the supporting documents related to revenue recognition by sampling, including sales contract, order, sales invoice, delivery order and customer receipt; For export revenue, obtain the E-port Information and check it with the book records, and check the sales contract, export declaration form, freight bill of lading, sales invoice and other supporting documents by sampling;
(4) Implement analysis procedures for income and cost, including: analysis of monthly income, cost and gross profit fluctuation in the current period, and analysis procedures for the comparison of income, cost and gross profit margin of main products in the current period with that in the previous period;
(5) Conduct a cut-off test on the income recognized before and after the balance sheet date by sampling, and check the supporting documents such as the delivery note and receipt note, so as to evaluate whether the income is recognized in an appropriate period;
(6) Check whether the presentation and disclosure of information related to revenue recognition in the financial statements are sufficient and appropriate. (II) impairment of accounts receivable
See notes IV, 10 and VI and 4 to the financial statements for relevant information disclosure.
1. Item description
Bohai Automotive Systems Co.Ltd(600960) company on December 31, 2021, the book balance of accounts receivable was 87317315570 yuan, and the provision for impairment of accounts receivable was 5763092098 yuan Bohai Automotive Systems Co.Ltd(600960) company calculates the expected credit loss of accounts receivable based on the expected credit loss of accounts receivable in the whole duration. The management needs to refer to the historical credit loss experience and combined with the current situation and the prediction of future economic conditions. There is inherent uncertainty in these major judgments. Therefore, we regard the estimation of bad debt provision of accounts receivable as a key audit matter.
Zhongxinghua Certified Public Accountants (special general partnership)
2. Audit response
(1) Understand the key internal controls related to the evaluation of expected credit loss of accounts receivable, evaluate the rationality of these control designs, and test the effectiveness of the implementation of relevant key internal controls;
(2) Obtain the bad debt provision table, check the rationality and consistency of the provision method, and recalculate the accuracy of the calculation of expected credit loss;
(3) Considering the characteristics and nature of customers, to evaluate the appropriateness of the expected credit loss method and model adopted by the management, and to evaluate the rationality of the management's forward-looking adjustment to the expected credit loss;
(4) Review the relevant considerations and objective evidence of the management's credit risk assessment of accounts receivable on December 31, 2021, and evaluate whether the management has properly identified the credit risk characteristics of various accounts receivable;
(5) Analyze the aging of accounts receivable and the reputation of customers, implement audit procedures such as letter of confirmation and collection after the inspection period, and evaluate the rationality of the provision for bad debts of accounts receivable;
(6) Check whether the information related to the impairment of accounts receivable has been properly presented and disclosed in the financial statements.
4、 Other information
Bohai Automotive Systems Co.Ltd(600960) company management (hereinafter referred to as management) is responsible for other information. Other information includes the information covered in the 2021 annual report of Bohai Automotive Systems Co.Ltd(600960) company, 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 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 going concern ability of Bohai Automotive Systems Co.Ltd(600960) company, disclosing matters related to going concern (if applicable), and applying the going concern assumption, unless the management plans to liquidate Bohai Automotive Systems Co.Ltd(600960)
Zhongxinghua Certified Public Accountants (special general partnership)
The company, termination of operation or no other realistic choice.
The management is responsible for supervising the financial reporting process of Bohai Automotive Systems Co.Ltd(600960) company.
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 auditing in accordance with the auditing standards, we used professional judgment and maintained 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. 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. (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 Bohai Automotive Systems Co.Ltd(600960) company. 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 inability of Bohai Automotive Systems Co.Ltd(600960) company to continue its business.
(5) Evaluate the overall presentation, structure and content (including disclosure) 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 Bohai Automotive Systems Co.Ltd(600960) company to express an opinion on the financial statements. I
