Securities code: Funeng Oriental Equipment Technology Co.Ltd(300173) securities abbreviation: Funeng Oriental Equipment Technology Co.Ltd(300173) Announcement No.: 2022045 Funeng Oriental Equipment Technology Co.Ltd(300173)
Announcement on the provision of credit impairment loss and asset impairment loss 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.
1、 Reasons for withdrawing credit impairment loss and asset impairment loss this time
Funeng Oriental Equipment Technology Co.Ltd(300173) (hereinafter referred to as "the company") made the impairment test on the credit and assets within the scope of the consolidated financial statements in 2021 based on the principle of prudence in accordance with the accounting standards for business enterprises, accounting policies and accounting estimates, judged that there were signs of possible impairment, and determined the credit impairment loss and asset impairment loss to be withdrawn.
In 2021, the company and its subsidiaries accrued credit impairment loss of 10142308093 yuan and asset impairment loss of 16249296487 yuan. The details of provision are as follows:
(I) credit impairment loss
Current amount unit of the project (yuan)
Bad debt loss of other receivables -5528735781
Bad debt loss of long-term receivables -535461597
Bad debt loss of notes receivable 487894432
Bad debt loss of accounts receivable -4358564635
Bad debt loss of prepayment -207440512
Total -10142308093
(II) asset impairment loss
Current amount of the project
Inventory depreciation loss and contract performance cost impairment loss -6945399325
Impairment loss of long-term equity investment
Goodwill impairment loss -7943356568
Current amount of the project
Impairment loss of contract assets -1360540594
Total -16249296487
The provision for credit impairment loss and asset impairment loss has been deliberated and approved at the 28th meeting of the Fifth Board of directors and the 18th meeting of the Fifth Board of supervisors. This provision does not need to be submitted to the 2021 annual general meeting of the company for deliberation.
2、 The impact of the accrued credit impairment loss and asset impairment loss on the company
The provision for credit impairment and asset impairment losses will reduce the company's operating profit of 26391604580 yuan in 2021, which has been audited and confirmed by Guangdong chenganxin Certified Public Accountants (special general partnership). 3、 Recognition standard and withdrawal method of credit impairment loss and asset impairment loss withdrawn this time
(I) provision for credit impairment losses: notes receivable, accounts receivable, prepayments, other receivables and long-term receivables of the company.
The company estimates the expected credit losses of financial assets measured at amortized cost, financial assets (debt instruments) measured at fair value and whose changes are included in other comprehensive income, financial guarantee contracts, etc. individually or in combination.
Based on the characteristics of common credit risk, the company divides financial instruments into different combinations. The common credit risk characteristics adopted by the company include: type of financial instruments, credit risk rating, aging combination, etc. For the individual evaluation criteria and combined credit risk characteristics of relevant financial instruments, see note "(x) 7, individual evaluation criteria and combined credit risk characteristics of relevant financial instruments" in the company's annual report 2021.
The company takes into account the past events, current situation, prediction of future economic conditions and other reasonable and reliable information, takes the risk of default as the weight, calculates the probability weighted amount of the present value of the difference between the cash flow receivable under the contract and the cash flow expected to be received, and recognizes the expected credit loss.
If the credit risk of the financial instrument has increased significantly since the initial recognition, the company shall measure its loss reserves according to the amount equivalent to the expected credit loss of the financial instrument in the whole duration; If the credit risk of the financial instrument does not increase significantly after initial recognition, the company measures its loss reserves according to the amount equivalent to the expected credit loss of the financial instrument in the next 12 months. The increase or reversal amount of the loss reserves thus formed shall be included in the current profits and losses as impairment losses or gains.
The company compares the risk of default of financial instruments on the balance sheet date with the risk of default on the initial recognition date to determine the relative change of default risk during the expected duration of financial instruments, so as to evaluate whether the credit risk of financial instruments has increased significantly since the initial recognition. Generally, if it is overdue for more than 30 days, the company considers that the credit risk of the financial instrument has increased significantly, unless there is conclusive evidence that the credit risk of the financial instrument has not increased significantly since initial recognition.
If the credit risk of a financial instrument is low on the balance sheet date, the company considers that the credit risk of the financial instrument has not increased significantly since initial recognition.
If there is objective evidence indicating that a financial asset has been impaired, the company shall make provision for impairment of the financial asset on a single basis.
For receivables and contract assets formed by transactions regulated by the accounting standards for Business Enterprises No. 14 - Revenue (2017), regardless of whether they contain significant financing components, the company always measures its loss reserves according to the amount equivalent to the expected credit loss in the whole duration.
For lease receivables, the company chooses to always measure its loss reserves according to the amount equivalent to the expected credit loss in the whole duration.
If the company no longer reasonably expects that the contractual cash flow of financial assets can be recovered in whole or in part, the book balance of the financial assets shall be directly written down.
1. Notes receivable
The company will separately determine the credit loss of notes receivable that individually assess the credit risk, and choose to always measure the loss provision according to the amount equivalent to the expected credit loss during the duration.
When there is no sufficient evidence to evaluate the expected credit loss at a reasonable cost at the level of single instrument, the company refers to the experience of historical credit loss, combined with the current situation and the judgment of future economic conditions, divides the notes receivable into several combinations according to the characteristics of credit risk, and calculates the expected credit loss on the basis of the combination. The basis for determining the combination is as follows:
Combination name: basis for determining combination and accrual method
The drawee of a bank without credit risk has a high credit rating. There is no bill in history. With reference to the historical credit loss, the risk of credit loss is very low. It has a strong ability to perform its inspection in a short time and pay the contractual cash flow obligation in combination with the current situation. And low credit risk to the future economic situation. The commercial drawee has a high credit rating. In history, there has been no default on the exchange notes with the expected measurement of bad debt reserves, and there has been no overdue acceptance.
2. Accounts receivable, contract assets and other receivables
The company will separately determine the credit loss of accounts receivable with individual assessment of credit risk, and choose to always measure the loss reserve according to the amount equivalent to the expected credit loss in the duration.
When there is no sufficient evidence to evaluate the expected credit loss at a reasonable cost at the level of single instrument, the company refers to the experience of historical credit loss, combined with the current situation and the judgment of future economic conditions, divides the accounts receivable into several combinations according to the characteristics of credit risk, and calculates the expected credit loss on the basis of the combination. The basis for determining the combination is as follows:
Combination name: basis for determining combination and accrual method
Except for the receivables whose loss reserves have been measured separately, the company
The same as or similar to the previous year and divided by aging segment
The expected credit loss of receivables with similar credit risk characteristics is determined based on the expected credit loss of aging and the whole duration, taking forward-looking information into account. Under the combination of this group of expected credit loss rates, the company accrues the breakdown of accounts receivable according to different business segments
There are two combinations: combination 1 intelligent manufacturing equipment sector and combination 2
Lithium battery equipment.
With reference to the historical credit loss, the bad debt provision is measured based on the combination of related parties and the expectation of future economic conditions after the accounts receivable of related parties included in the consolidation scope are verified and combined with the current situation
3. Long term receivables
The company shall separately determine the credit loss of long-term receivables with significant single amount and credit impairment after initial recognition. When there is no sufficient evidence to evaluate the expected credit loss at a reasonable cost at the level of single instrument, the company refers to the experience of historical credit loss, combined with the current situation and the judgment of future economic conditions, divides the long-term receivables into several combinations according to the characteristics of credit risk, and calculates the expected credit loss on the basis of the combination.
(II) provision for inventory falling price
After a comprehensive inventory of inventories at the end of the period, the inventory falling price reserves shall be withdrawn or adjusted according to the lower of the inventory cost and net realizable value. The net realizable value of finished products, goods in stock, materials for sale and other goods inventories directly for sale shall be determined by the amount of the estimated selling price of the inventory minus the estimated selling expenses and relevant taxes in the normal process of production and operation; For the inventory of materials that need to be processed, in the normal production and operation process, the net realizable value is determined by the estimated selling price of the finished products minus the estimated cost to be incurred at the time of completion, estimated selling expenses and relevant taxes; The net realizable value of inventories held for the execution of sales contracts or labor contracts is calculated based on the contract price. If the quantity of inventories held is more than the quantity ordered in the sales contract, the net realizable value of excess inventories is calculated based on the general sales price.
At the end of the period, the inventory falling price reserves are accrued according to a single inventory item; However, for the inventory with large quantity and low unit price, the inventory falling price reserves shall be withdrawn according to the inventory category; If the inventories are related to the product series produced and sold in the same region, have the same or similar end use or purpose, and are difficult to be measured separately from other items, the inventory falling price reserves shall be accrued jointly.
If the factors affecting the previous write down of inventory value have disappeared, the amount of write down shall be restored and reversed within the amount of inventory falling price reserve originally withdrawn, and the reversed amount shall be included in the current profit and loss.
(III) provision for impairment of long-term equity investment
If there is objective evidence of impairment of investments in subsidiaries, associates and joint ventures on the balance sheet date, the corresponding impairment provision shall be withdrawn according to the difference between the book value and the recoverable amount.
(IV) provision for impairment of goodwill
In the goodwill impairment test, the recoverable value is determined by the present value of the expected future cash flow of the asset group. The present value of the estimated future cash flow of the asset group usually adopts the income method, that is, according to the estimated future cash flow generated by the asset group in the process of continuous use and final disposal, the appropriate discount rate is selected to determine the discounted amount. The forecast of expected future cash flow is based on the current situation of the asset group under the premise of the existing management and operation mode of the specific asset group
