audit report
Hunan Jiuzhitang Co.Ltd(000989) Pharmaceutical Co., Ltd
Rong Cheng Shen Zi [2022] No. 100z0196
Rongcheng Certified Public Accountants (special general partnership)
Beijing, China
Audit report
All shareholders of Hunan Jiuzhitang Co.Ltd(000989) Pharmaceutical Co., Ltd. (rcsz [2022] No. 100z0196):
1、 Audit opinion
We have audited the financial statements of Hunan Jiuzhitang Co.Ltd(000989) Pharmaceutical Co., Ltd. (hereinafter referred to as "pharmaceutical 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 owner's equity and notes to relevant financial statements.
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 financial position of the pharmaceutical company as of December 31, 2021 and the operating results and cash flow of the pharmaceutical company and the parent 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 pharmaceutical companies 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、 Responsibilities of management and governance for financial statements
The management of the pharmaceutical company 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 sustainable operation ability of the pharmaceutical company, disclosing matters related to sustainable operation (if applicable), and applying the assumption of sustainable operation, unless the management plans to liquidate the pharmaceutical company, terminate operation or has no other realistic choice.
The management is responsible for supervising the financial reporting process of pharmaceutical companies.
4、 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 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 the pharmaceutical 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 cause the pharmaceutical company 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 pharmaceutical companies 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).
(there is no text below, which is the signature and seal page of the report No. [2022] 100z0196 of Hunan Jiuzhitang Co.Ltd(000989) Pharmaceutical Co., Ltd.)
Rongcheng certified public accountants China Certified Public Accountants:
(special general partnership) Chen Moulin
Chinese certified public accountant:
Liu Jiaming
Beijing, China Certified Public Accountant:
Solitsone
April 22, 2022
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Legal representative: Guo Caihong person in charge of Accounting: Zhou Ling person in charge of accounting organization: Zhou Ling
Hunan Jiuzhitang Co.Ltd(000989) Pharmaceutical Co., Ltd
Notes to financial statements
Year 2021
(unless otherwise specified, the monetary unit is RMB)
1、 Basic information of the company
1. Company profile
Hunan Jiuzhitang Co.Ltd(000989) Pharmaceutical Co., Ltd. (hereinafter referred to as "the company") was jointly invested by Jiuzhitang Co.Ltd(000989) , Li Kejun and others. It was registered in Changsha Administration for Industry and Commerce on December 1, 2004 with a registered capital of 35 million yuan, of which Jiuzhitang Co.Ltd(000989) accounts for 90% of the registered capital and other natural persons account for 10% of the registered capital.
In 2016, the company obtained the business license of enterprise legal person with the registration number of 914 Dalian Demaishi Precision Technology Co.Ltd(301007) 68040923t. After previous equity changes, Jiuzhitang Co.Ltd(000989) holds 98.571% of the company's equity, and Li Kejun's natural person accounts for 1.429% of the registered capital. Company domicile: No. 339, tongzipo West Road, Changsha City, Hunan Province.
Legal representative of the company: Guo Caihong.
The company belongs to the pharmaceutical production industry, and its business scope is as follows: drugs, western medicine, Chinese patent medicine, protein assimilation preparations, peptide hormones, class I medical devices, class II medical devices, class III medical devices, prepackaged food, dairy products, bulk food, baby products, chemical reagents and daily chemical products (excluding dangerous and monitored chemicals), Cereals, beans and potatoes, cosmetics and sanitary products, cleaning products Wholesale of sanitary and toilet equipment and appliances, daily necessities, daily utensils and daily groceries, ceramics, glassware, instruments and meters, hardware products, furniture, glasses, traditional Chinese medicine decoction pieces, biological products and drinking water; Self operated and acting as an agent for the import and export of various commodities and technologies, except for the commodities and technologies that the state restricts the company to operate or prohibits the import and export; Wholesale and purchase of traditional Chinese medicine; Sales of health products, disinfectants, glassware, agricultural and sideline products and primary food Shenzhen Agricultural Products Group Co.Ltd(000061) ; Commodity information consulting services; Medical equipment leasing services; Information system integration service; Information technology consulting services; Computer technology development and technical services; Medical information and technical consulting services; Conference services; Rental of premises; Organization of training activities; Wholesale of medical diagnosis, monitoring and treatment equipment; Logistics agency services; Warehousing agency services; Software development system integration services. (for projects that must be approved according to law, business activities can be carried out only with the approval of relevant departments, and Internet financial services such as unauthorized payment, virtual currency trading, ICO, illegal foreign exchange and so on).
2、 Preparation basis of financial statements
1. Preparation basis
The company prepares the financial statements on the basis of continuous operation, based on the actual transactions and events, and in accordance with the accounting standards for business enterprises and its application guidelines and the provisions of the interpretation of the standards. In addition, the company also disclosed relevant financial information in accordance with the rules for the preparation of information disclosure of companies offering securities to the public No. 15 - General Provisions on financial reports (revised in 2014) of the CSRC.
2. Going concern
The company has evaluated the continuous operation ability of the company for 12 months since the end of the reporting period, and no matters affecting the continuous operation ability of the company are found. It is reasonable for the company to prepare financial statements based on continuous operation. 3、 Important accounting policies and accounting estimates
The following important accounting policies and accounting estimates of the company are formulated in accordance with the accounting standards for business enterprises. The businesses not mentioned shall be implemented in accordance with the relevant accounting policies in the accounting standards for business enterprises.
1. Statement of compliance with accounting standards for business enterprises
The financial statements prepared by the company comply with the requirements of the accounting standards for business enterprises and truly and completely reflect the company's financial status, operating results, changes in owner's equity, cash flow and other relevant information.
2. Accounting period
The accounting year of the company starts from January 1 to December 31 of the Gregorian calendar.
3. Business cycle
The normal business cycle of the company is one year.
4. Recording currency
The bookkeeping base currency of the company is RMB, and the currency of overseas subsidiaries in the main economic environment in which they operate is the bookkeeping base currency.
5. Accounting treatment methods for business combinations under the same control and not under the same control
(1) Business combination under the same control
The assets and liabilities obtained by the company in business combination shall be measured at the book value of the combined party in the consolidated financial statements of the final controller on the combination date. Among them, if the accounting policies adopted by the merged party and the company before business combination are different, the accounting policies shall be unified based on the principle of importance, that is, the book value of the assets and liabilities of the merged party shall be adjusted according to the accounting policies of the company. If there is a difference between the book value of the net assets obtained by the company in business combination and the book value of the consideration paid, the capital reserve (capital premium or equity premium) shall be adjusted first. If the balance of capital reserve (capital premium or equity premium) is insufficient to offset, the surplus reserve and undistributed profit shall be offset successively.
For the accounting treatment method of business combination under the same control through step-by-step transactions, see note III, 6 (6). (2) Business combination not under the same control
The identifiable assets and liabilities of the acquiree obtained by the company in business combination shall be measured at their fair value on the acquisition date. Among them, if the accounting policies adopted by the acquiree and the company before business combination are different, the accounting policies shall be unified based on the principle of importance, that is, the book value of the acquiree's assets and liabilities shall be adjusted according to the accounting policies of the company. The difference between the combination cost of the company on the acquisition date and the fair value of the identifiable assets and liabilities of the acquiree obtained in the business combination is recognized as goodwill; If the combination cost is less than the difference between the fair value of the identifiable assets and liabilities of the acquiree obtained in the business combination, the combination cost and the fair value of the identifiable assets and liabilities of the acquiree obtained in the business combination shall be reviewed first. If the combination cost is still less than the fair value of the identifiable assets and liabilities of the acquiree obtained after review, the difference shall be recognized as the current profit and loss of the combination.
For the accounting treatment method of business combination not under the same control through step-by-step transactions, see note III, 6 (6). (3) Treatment of transaction expenses in business combination
The intermediary expenses such as audit, legal services, appraisal and consultation and other relevant management expenses incurred for business combination shall be included in the current profit and loss when incurred. The transaction expenses of equity securities or debt securities issued as merger consideration shall be included in the initial recognition amount of equity securities or debt securities.
6. Preparation method of consolidated financial statements
(1) Determination of consolidation scope
The consolidation scope of consolidated financial statements is determined on the basis of control, including not only subsidiaries determined according to voting rights (or similar voting rights) themselves or in combination with other arrangements, but also structured entities determined based on one or more contractual arrangements.
Control means that the company has the power over the investee, enjoys variable returns by participating in relevant activities of the investee, and has the ability to use the power over the investee to influence its performance
