Yonker Environmental Protection Co.Ltd(300187) audit report Tian Ye Zi [2022] No. 13718
catalogue
Audit report 12021 annual financial statements 62021 annual financial statements note 18 audit report
Tian Zhi Ye Zi [2022] No. 13718 Yonker Environmental Protection Co.Ltd(300187) all shareholders:
1、 Audit opinion
We have audited the financial statements of Yonker Environmental Protection Co.Ltd(300187) (hereinafter referred to as " Yonker Environmental Protection Co.Ltd(300187) "), including the consolidated balance sheet and balance sheet as of December 31, 2021, the consolidated income statement and income statement, the consolidated cash flow statement and cash flow statement, the consolidated statement of changes in owner's equity and the statement of changes in owner's equity in 2021, and the notes to relevant financial statements.
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 consolidated financial position and financial position of Yonker Environmental Protection Co.Ltd(300187) December 31, 2021, the consolidated operating results and consolidated cash flow, operating results and cash flow of 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. According to the code of professional ethics for Chinese certified public accountants, we are independent of Yonker Environmental Protection Co.Ltd(300187) , 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.
Audit report (Continued)
Tian Zhi Ye Zi [2022] No. 13718 key audit matters how to deal with them in the audit
1. Recognition of engineering construction income and cost carry forward Yonker Environmental Protection Co.Ltd(300187) engineering construction income accounts for a large proportion. For the recognition of engineering construction income of atmospheric treatment workers, the main audit procedures we implement are as follows: the performance obligations such as engineering and heavy metal soil remediation are determined as the performance obligations performed within a certain period of time. 1. Understand and evaluate the internal control of the management related to the recognition of engineering construction income, and the performance system design is determined according to the output method, And test the effectiveness of key control implementation. The progress is determined according to the proportion of the completed contract workload in the estimated total contract. 2. Check the main terms of the engineering construction contract, evaluate the engineering construction income and confirm the workload. The performance schedule determines the appropriateness of policies involving management. Major judgments and estimates, including the completion progress, scope of delivery 3, obtaining and checking the output value report signed and sealed by the customer or the supervisor, as well as the estimation of required services, total contract revenue and contract risks, and checking the total contract amount of the project in combination with the project contract and supplementary contract. In addition, due to the change of circumstances, the total contract revenue and other possible amounts shall be reviewed for the accuracy of completion progress and revenue. It will change from the original estimate (sometimes it may be significant). 4. Carry out analytical review on the gross profit margin of major project contracts; The construction cost of Yonker Environmental Protection Co.Ltd(300187) project is confirmed by letter. According to the performance progress, combined with the estimated total contract amount, completion progress and cumulative collection, the total construction cost and the operating cost carried forward in previous years are evaluated to confirm the overall rationality and accuracy of the current construction income.
Business costs. For the project construction cost carry forward, the main audit procedures we implemented are as follows: the confirmation of the estimated total cost involves major judgments and estimates, including PRE-1, understanding and evaluating the internal control total cost composition related to the project construction cost accounting carried forward, the unfinished cost, the design of key control points due to workload changes, and testing the effectiveness of the implementation of key control points. There may be potential risks in the adjustment of the estimated total cost and contract risk. 2. Interview with the management to check the preparation and approval of the estimated total cost and the risk of misrepresentation of the project under construction. This accounting and other data are used to evaluate the project construction cost carry forward and accounting method. Therefore, we determine the appropriateness of project construction income recognition and cost carry forward.
For key audit matters. 3. Select the sample of engineering construction contract, check the constituent items of the estimated total cost, refer to note III (XXXI) of the financial statements and the financial statements attached to the procurement contract and other supporting documents, and evaluate the completeness of the determination of the estimated total cost.
4. Select the sample of engineering construction contract, check the contract, invoice, material and equipment receipt, progress confirmation and other supporting documents of actual engineering cost, and evaluate the accuracy and integrity of actual engineering cost accounting.
Audit report (Continued)
Tian Zhi Ye Zi [2022] No. 13718 key audit matters how to deal with them in the audit
2. Provision for bad debts of accounts receivable Yonker Environmental Protection Co.Ltd(300187) the ending balance of accounts receivable is significant. The bad account of accounts receivable is the provision for bad debts of accounts receivable. The main audit account provision we implemented is measured by the expected credit loss model.
The corresponding sequence of the management is as follows: accounts receivable are calculated according to the amount equivalent to the expected credit loss in the whole duration. 1. Understand, evaluate and test Yonker Environmental Protection Co.Ltd(300187) and accounts receivable management, and measure the bad debt provision by taking into account the historical collection data of accounts receivable and the expected credit loss model to calculate the loss provision and the relevant expected loss probability and forward-looking information of withdrawing the bad debt provision. Design and operation effectiveness of key control points of internal control with similar credit loss model.
The bad debt provision is estimated for customer groups of type. 2. The basis for obtaining the management's estimate includes historical credit loss. Since the management needs to use major acceptance, historical collection and forward-looking information to make recalculation estimation and judgment when using the expected credit loss model, and the amount of influence is significant, we review the accounts receivable, Under the expected credit loss model, it is determined as a key audit event through default risk exposure and bad debt provision. Whether the bad debt provision estimated and withdrawn by the credit loss rate throughout the duration is fully disclosed, please refer to note III, (x) to the financial statements and the notes to the financial statements.
6、 (Ⅳ) 3. For accounts receivable for which bad debt reserves are separately accrued, obtain the basis for the management to estimate the expected future recoverable amount, including customer credit records, court judgments and relevant materials, and review its rationality. 4. For accounts receivable for which bad debt provision is withdrawn according to the expected credit loss model estimated by the portfolio and management, select samples to analyze and calculate the adequacy and rationality of bad debt provision of accounts receivable.
4、 Other information
The management is responsible for other information. Other information includes the information covered in the 2021 annual report, 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.
Audit report (Continued)
Tszz [2022] No. 13718 v. 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 Yonker Environmental Protection Co.Ltd(300187) and disclosing the matters related to going concern (if applicable), and applying the going concern assumption, unless it plans to liquidate Yonker Environmental Protection Co.Ltd(300187) , terminate the operation or has no other realistic choice.
The management is responsible for supervising the financial reporting process of Yonker Environmental Protection Co.Ltd(300187) .
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. 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 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 Yonker Environmental Protection Co.Ltd(300187) going concern ability. If we conclude that there is significant uncertainty, the auditing standards require us to remind the users of the statements in the audit report
Audit report (Continued)
Tzyz [2022] No. 13718: pay attention to the relevant disclosures in the financial statements; 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 cause Yonker Environmental Protection Co.Ltd(300187) to be unable to continue its business. 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 Yonker Environmental Protection Co.Ltd(300187) to express an audit 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.
