catalogue
1、 Audit report Page 1-6 II. Financial statements Page 7-14
(I) consolidated balance sheet Page 7
(II) balance sheet of the parent company Page 8
(III) consolidated income statement Page 9
(IV) profit statement of the parent company Page 10
(V) consolidated cash flow statement Page 11
(VI) cash flow statement of the parent company Page 12
(VII) consolidated statement of changes in owner’s equity Page 13
(VIII) statement of changes in owner’s equity of the parent company Page 14 III. notes to financial statements Page 15-106
Audit report
TJS [2022] No. 2-191
Mango Excellent Media Co.Ltd(300413) all shareholders:
1、 Audit opinion
We have audited the financial statements of Mango Excellent Media Co.Ltd(300413) (hereinafter referred to as Mango Excellent Media Co.Ltd(300413) 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 2021.
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 consolidated and parent company’s financial position of Mango Excellent Media Co.Ltd(300413) company as of December 31, 2021, as well as the consolidated and parent company’s operating results and cash flow 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 Mango Excellent Media Co.Ltd(300413) 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. We shall not express an opinion on these matters based on the overall audit of the financial statements. 3. Revenue recognition
1. Event description
See notes III (XXII), V (II) 1 and XIII (II) of the financial statements for relevant information disclosure.
The operating revenue of Mango Excellent Media Co.Ltd(300413) company mainly comes from Mango TV Internet video business, new media interactive entertainment content production business, content e-commerce, etc. In 2021, Mango Excellent Media Co.Ltd(300413) company’s operating revenue amounted to RMB 153558635 million, of which the operating revenue of mango TV Internet video business and new media interactive entertainment content production business was RMB 131387078 million, accounting for 85.56% of the operating revenue. Since operating revenue is one of the key performance indicators of Mango Excellent Media Co.Ltd(300413) company, there may be inherent risks that the management of Mango Excellent Media Co.Ltd(300413) company (hereinafter referred to as the management) may achieve specific goals or expectations through inappropriate revenue recognition. At the same time, revenue recognition involves complex information systems and major judgments of management. Therefore, we identified revenue recognition as a key audit matter.
2. Audit response
For revenue recognition, our audit procedures mainly include:
(1) Understand the key internal controls related to revenue recognition, evaluate the design of these controls, determine whether they have been implemented, and test the operational effectiveness of relevant internal controls;
(2) Use the work of internal information technology experts to test the general control of information system and the application control related to revenue recognition process;
(3) Check the main sales contracts, understand the main contract terms or conditions, and evaluate whether the revenue recognition method is appropriate;
(4) Implement analysis procedures for operating revenue and gross profit margin on a monthly basis, products, customers, etc., identify whether there are significant or abnormal fluctuations, and find out the causes of fluctuations;
(5) Select samples for different types of income, and test the details of contracts, licenses, settlement documents, collection documents and signing documents according to each business type, and pay attention to the business content and commercial rationality of related sales; (6) Combined with the letter of accounts receivable, the current sales volume is confirmed to the main customers by sampling;
(7) Conduct a cut-off test on the operating income recognized before and after the balance sheet date to evaluate whether the operating income is recognized in an appropriate period;
(8) Obtain the sales return records after the balance sheet date and check whether there is any situation that does not meet the conditions for revenue recognition on the balance sheet date;
(9) Check whether the information related to operating income has been properly presented in the financial statements.
（2） Book value of content copyright
1. Event description
See notes III (XI), (XVII) and V (I) 8 and 14 of the financial statements for relevant information disclosure.
As of December 31, 2021, the book value of Mango Excellent Media Co.Ltd(300413) company’s network information dissemination rights, scripts, film and television dramas and other content copyrights was 79068178 million yuan, including 62966222 million yuan of intangible assets and 16101956 million yuan of inventory.
The management uses significant judgment to evaluate the book value of these network information dissemination rights, scripts, film and television dramas and other content copyrights. In making the relevant assessment, the management takes into account all possible factors that may affect the future broadcasting, production and distribution plans of network information dissemination rights, scripts, film and television dramas and other content copyrights, the selling price or pre pricing of film and television dramas, the discount rate and the current market environment, and judges its expectation of future cash flow. As the amount of copyright of network information dissemination right, script, film and television drama and other content is significant and involves significant management judgment, we determine the book value of copyright of network information dissemination right, script, film and television drama and other content as key audit matters.
2. Audit response
With regard to the book value of the copyright of network information dissemination rights, scripts, film and television plays and other content, our audit procedures mainly include:
(1) Understand the key internal controls related to the copyright of network information dissemination rights, scripts, film and television dramas, evaluate the design of these controls, determine whether they have been implemented, and test the operation effectiveness of relevant internal controls; (2) Whether the amortization right of computer information dissemination system is reasonable, and whether the amortization right of computer information dissemination system is understood and implemented;
(3) By comparing the relevant accounting standards and industry practice benchmarks, we evaluate whether the accounting policies related to the copyright of network information dissemination right, script, film and television drama and other content are reasonable. According to the importance level of the ending net value of network information dissemination right, script, film and television drama and other content copyright, we sample and test the management’s evaluation of the recoverable amount of network information dissemination right, script, film and television drama and other content copyright;
(4) Check the relevant agreements for purchasing the copyright of network information dissemination right, script and other content, verify the validity period of its authorization, and evaluate the rationality of its net realizable value; Select samples of self-made film and television dramas and discuss with the management to understand the current market environment and its future production and distribution plans;
(5) Check the distribution contract to verify the estimated selling price of network information dissemination right, script, film and television drama and other content copyright.
For TV dramas that have been produced but have not obtained the broadcasting license, we select samples and compare the estimated selling price of these TV dramas with the available selling price of similar TV dramas to evaluate their impairment;
(6) Pay attention to the public opinion on the copyright of network information dissemination right, script, film and television drama and other content, evaluate its negative public opinion, and discuss with the management whether it is expected to be off the shelf or unable to be produced;
(7) Check whether the information related to the copyright impairment and amortization of network information dissemination right, script, film and television drama and other contents has been properly presented in the financial statements.
4、 Other information
The management is responsible for other information. Other information includes the information covered in the 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.
5、 Responsibilities of management and governance for financial statements
The management is responsible for preparing the financial statements in accordance with 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, whether due to fraud or error.
When preparing the financial statements, the management is responsible for evaluating the sustainable operation ability of Mango Excellent Media Co.Ltd(300413) company, disclosing matters related to sustainable operation (if applicable), and applying the assumption of sustainable operation, unless liquidation is planned, operation is terminated or there is no other realistic choice.
Mango Excellent Media Co.Ltd(300413) corporate governance (hereinafter referred to as governance) is responsible for supervising the financial reporting process of Mango Excellent Media Co.Ltd(300413) 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 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 the sustainable operation ability of Mango Excellent Media Co.Ltd(300413) 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 Mango Excellent Media Co.Ltd(300413) 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 Mango Excellent Media Co.Ltd(300413) company to express audit opinions 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. Tianjian Certified Public Accountants (special general partnership) Chinese certified public accountant:
(project partner)
Hangzhou, China Certified Public Accountant:
April 21, 2002
Consolidated balance sheet
December 31, 2021
Huihe form 01 prepared by: Mango Excellent Media Co.Ltd(300413)
