About Jinzi Ham Co.Ltd(002515)
Inquiry letter of 2021 Annual Report
Annual report inquiry letter [2022] No. 114 of the company Department Jinzi Ham Co.Ltd(002515) board of directors:
During the post review of your company’s 2021 annual report (hereinafter referred to as the “annual report”), our department paid attention to the following matters:
1. The annual report shows that during the reporting period, your company achieved an operating revenue of 506 million yuan, a year-on-year decrease of 28.79%, and a net profit attributable to shareholders of listed companies of 428539 million yuan, a year-on-year decrease of 27.74%. Among them, from the first quarter to the fourth quarter, the operating revenue was 250 million yuan, 71 million yuan, 79 million yuan and 105 million yuan respectively, and the net profits attributable to the shareholders of the listed company were 601308 million yuan, 4.5237 million yuan, – 7.8553 million yuan and – 139452 million yuan respectively. During the reporting period, the sales expenses and management expenses of your company were 404097 million yuan and 167784 million yuan respectively, an increase of 20.05% and 11.55% respectively over the same period of last year.
In addition, your company’s report for the first quarter of 2022 shows that in the first quarter of 2022, the operating revenue was 137 million yuan, a decrease of 45.14% over the same period of the previous year, and the net profit attributable to the shareholders of the parent company was 221336 million yuan, a year-on-year decrease of 63.19%.
Please your company:
(1) Explain the reasons for the sharp decline in operating revenue and net profit of your company in 2021 and the first quarter of 2022, as well as the measures (if any) your company has taken or plans to take, in combination with the market environment, the operation of your company, the impact of the change of your company’s actual controller on your company and other factors;
(2) Explain the reason and rationality of the sharp fluctuation of your company’s quarterly performance in combination with the historical performance of your company and the seasonal impact of product sales;
(3) Explain the reason and rationality of the rapid growth of sales expenses and management expenses while your company’s operating revenue has fallen sharply.
2. The annual report shows that the total sales amount of your company to the top five customers during the reporting period is 943788 million yuan, accounting for 18.65% of the total annual sales, and the total purchase amount of the top five suppliers is 146 million yuan, accounting for 50.20% of the total annual purchase.
Please your company:
(1) Explain the specific information of the top five customers and suppliers, including sales / procurement content, transaction amount, signing time of contract or order, time point and basis of revenue recognition, amount of accounts receivable and subsequent collection, and report the specific names of the top five customers and suppliers to our department;
(2) Explain whether the above top five customers and suppliers have related relationships with your company, directors, supervisors, senior managers, more than 5% shareholders and actual controllers or other relationships that may tilt interests, and the performance of necessary review procedures and temporary information disclosure obligations for relevant transactions;
(3) Explain the changes and rationality of your company’s top five customers and suppliers in the last three years, and whether the top five customers and suppliers match the top five of the ending balance of accounts receivable and the top five of the ending balance of accounts payable. If not, explain the reasons and rationality. The annual audit accountant is requested to check the above problems and give clear opinions.
3. The annual report shows that the ending book value of your company’s inventory is 574 million yuan, accounting for 66.40% of your company’s ending current assets. From the end of 2017 to the end of 2020, the book value of your company’s inventories accounted for 15%, 15%, 37% and 65% of current assets respectively; The book value of your company’s raw materials is 253 million yuan, and the provision for inventory falling price is 214102 million yuan, accounting for 7.81% of the book balance of raw materials; Your company has not made provision for falling price of products in process, goods in stock and other inventories; During the reporting period, the inventory turnover rate of your company was 0.662, a decrease of 36.75% over the same period of last year.
Please your company:
(1) Explain the reason and rationality of the sharp increase in the proportion of the book value of inventories to current assets in your company in recent five years, and explain the authenticity of inventories in combination with whether the change of relevant proportion is in line with the actual production and operation of your company;
(2) List the composition and purchase cost of raw materials in stock at the end of 2021 by category, and explain the adequacy of your company’s provision for inventory falling price of raw materials in combination with the market price trend of raw materials;
(3) List the specific composition of inventory, product price change, product shelf life, inventory status, etc. at the end of 2021 by product, and explain the specific situation of impairment test and the adequacy of the provision for inventory falling price;
(4) Explain the reasons and rationality of the sharp decline in inventory turnover rate in 2021.
Ask the annual audit accountant to check the above questions (2) (3) and give clear opinions, and explain the inventory taking and other audit procedures performed on the company’s inventory.
4. The annual report shows that the closing book value of your company’s accounts receivable is 338922 million yuan, an increase of 57.18% over the same period last year. During the reporting period, the turnover rate of accounts receivable of your company was 18.24, a decrease of 49.78% over the same period of last year.
Please your company:
(1) Explain the reason and rationality of the significant increase in the balance of accounts receivable at the end of the period on a year-on-year basis in combination with revenue recognition, credit policy and business development during the reporting period;
(2) Explain the reason and rationality of the sharp decline in the turnover rate of accounts receivable in the reporting period compared with the same period of last year;
(3) Explain the adequacy of bad debt provision in combination with the reply to the above questions; Ask the annual audit accountant to check the above question (3) and give clear opinions. 5. The annual report shows that since mid September 2021, your company’s futures traders have not closed their positions in accordance with the company’s instructions, and the volume of closed positions is far greater than the volume purchased in the spot market in the current month. Your company recognizes the loss caused by hedging instruments as the ineffective part of hedging and records it into the current profits and losses. At the same time, the futures trader will compensate the company in full according to the assessment measures for futures hedging business operation of your company due to the heavy losses of your company caused by the futures trader’s closing positions without permission. According to the investigation, the compensation paid by the futures trader to your company comes from the self owned and self raised funds of his father-in-law Shi xiongbiao (a natural person shareholder holding 3.45% of the shares of your company, and Shi xiongbiao is the brother of Shi Yanjun, the former actual controller of your company). Therefore, your company will include the compensation in the non operating income. Due to the above matters, the annual audit accountant has issued a qualified internal control assurance report to your company. Please your company:
(1) Explain the rectification and effect of relevant internal control defects of your company;
(2) Explain whether the above matters belong to equity transactions and their basis and rationality, whether the relevant compensation can be included in the non operating income in 2021, and whether your company uses relevant accounting treatment to adjust profits.
Ask the annual audit accountant to check the above question (2) and give clear opinions. 6. According to the annual report, on October 11, 2021, the shareholders of your company, anjibama enterprise management partnership (limited partnership) (hereinafter referred to as “anjibama”), Ren Guilong and Shi Yanjun jointly signed the share transfer agreement, and anjibama transferred all 198625280 shares of the company (20.30% of the total share capital of the company) to Ren Guilong. After the transaction is completed, Ren Guilong becomes the controlling shareholder and actual controller of your company. Anjibama, Ren Guilong and Shi Yanjun signed a tripartite performance commitment, promising that the net profit attributable to the shareholders of the listed company (the lower one before and after deducting non recurring profits and losses) under the consolidated statements of 2021 will not be less than 100 million yuan. During the performance commitment period, if the actual net profit of the listed company in the current year is lower than 80% of the promised net profit, anjibama and Shi Yanjun shall compensate Ren Guilong in cash within thirty (30) days after the announcement of the audit report of the listed company in the current year. Please indicate whether the performance of your company in 2021 has triggered the performance compensation obligation of anjibama and Shi Yanjun, and whether anjibama and Shi Yanjun have completed relevant compensation. Ask your company’s lawyer to check and express clear opinions.
7. The annual report shows that on March 5, 2021, the former controlling shareholder of your company, anjibama, publicly auctioned and accepted the remaining creditor’s rights of your company’s equity repurchase of Zhongyu capital at the price of 300 million yuan. As of December 30, 2021, anjibama has fulfilled its obligation to pay the first transfer payment in accordance with the debt transfer agreement signed by both parties, totaling 100 million yuan.
Please supplement and disclose the payment arrangement of the remaining transfer money, and explain whether your company’s provision for impairment of relevant long-term receivables is sufficient in combination with anjibama’s performance ability. Ask the annual audit accountant to check and give clear opinions.
8. According to the annual report, the net profit attributable to the shareholders of the listed company after deducting non recurring profits and losses during the reporting period was 211253 million yuan. In combination with the reply to the above questions and the specific composition and accounting process of your company’s non recurring profit and loss in the reporting period, please explain whether your company’s non net profit deduction is actually negative in the reporting period. If not, please explain the specific calculation process and basis of relevant data; If yes, please explain the deduction of operating income and the income after deduction in accordance with the relevant provisions of the exchange. Ask the annual audit accountant to check and give clear opinions.
9. On April 8, 2022, your company received the notice of investigation filed by the CSRC for suspected illegal information disclosure. Please explain the progress of the above-mentioned investigation matters as of the reply date, the impact of the investigation on the operation of your company, and assess whether your company has the possibility of touching the provisions of articles 9.5.1 and 9.5.2 of the stock listing rules (revised in 2022). If so, please give timely and full risk warning.
Please make a written statement on the above issues, submit the relevant explanatory materials to our department for disclosure before May 9, 2022, and send a copy to the dispatched office at the same time.
We are writing to inform you that
Shenzhen Stock Exchange
Listed company management department I
April 22, 2022
