Jilin Xidian Pharmaceutical Technology Development Co., Ltd
Annual financial report for 2021
April 2022
financial reports
1、 Audit report
Unqualified opinion of audit opinion type standard
Signing date of audit report: April 22, 2022
Name of audit institution: Dahua Certified Public Accountants (special general partnership)
Audit Report No.: dhsz [2022] 001402
Name of certified public accountant Gao Shimao, Tian leibin
Body of audit report
All shareholders of Jilin Xidian Pharmaceutical Technology Development Co., Ltd.:
1、 Audit opinion
The audited financial statements of Jilin Pharmaceutical Technology Development Co., Ltd. (hereinafter referred to as the statement of changes in shareholders' equity on December 31, 2021) and the notes to the financial statements of Jilin Pharmaceutical Technology Development Co., Ltd. (hereinafter referred to as the statement of changes in shareholders' equity on December 31, 2021).
In our opinion, the attached financial statements are prepared in accordance with the provisions of the accounting standards for business enterprises in all major aspects and fairly reflect the financial position of West Point pharmaceutical as of December 31, 2021 and the 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. In accordance with the code of professional ethics for Chinese certified public accountants, we are independent of West Point pharmaceutical 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.
We confirm that the recognition of operating revenue is a key audit matter that needs to be communicated in the audit report.
1. Item description
For the accounting policies and carrying amount information related to the recognition of operating income of West Point pharmaceutical, please refer to the financial report / V important accounting policies and accounting estimates / 29 and VII notes / Notes 27 to the items of financial statements.
In 2021, the operating revenue of West Point pharmaceutical was 28565593211 yuan; In 2020, the operating income of West Point pharmaceutical was 28631871928 yuan.
As the operating income is one of the key performance indicators of West Point pharmaceutical, there is an inherent risk that the management manipulates the revenue recognition in order to achieve specific goals or expectations, and there may be a risk of material misstatement whether the operating income is true and accurate and whether it is included in the appropriate accounting period. Therefore, we regard the recognition of operating income as a key audit matter. 2. Audit response
Our important audit procedures for the recognition of operating revenue include:
(1) Understand and evaluate the design of management's internal control related to the recognition of operating revenue, and test the effectiveness of the implementation of key control activities;
(2) Interview with the management and select samples to check the sales contracts to evaluate whether the revenue recognition accounting policies of West Point pharmaceutical meet the requirements of the accounting standards for business enterprises;
(3) Implement analytical procedures for revenue and cost. Compare and analyze the sales revenue and gross profit margin of West Point pharmaceutical in the reporting period by product category, sales region and sales customers;
(4) Select customers by sampling and implement the letter confirmation procedure for their transaction volume and accounts receivable balance during the reporting period;
(5) Inquire the industrial and commercial data of major customers (dealers) during the reporting period through public information, and check whether there is a relationship with West Point pharmaceutical;
(6) Select samples by sampling to check the sales contract or order, sales invoice, delivery order, receipt confirmation and other supporting documents related to revenue recognition;
(7) Perform a cut-off test. For the revenue recognized before and after the balance sheet date at the end of each reporting period, select samples to check the delivery order, receipt and other relevant supporting documents, and evaluate whether the revenue recognition is recorded in the appropriate accounting period.
Based on the audit work performed, we believe that the accounting policies adopted by West Point pharmaceutical in the recognition of operating income are reasonable and correctly recorded in the appropriate accounting period.
4、 Other information
The management of West Point pharmaceutical 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 understand 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 of West Point pharmaceutical 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.
In preparing the financial statements, the management of West Point pharmaceutical is responsible for evaluating the sustainable operation ability of West Point pharmaceutical, disclosing matters related to sustainable operation (if applicable), and applying the assumption of sustainable operation, unless the management plans to liquidate West Point pharmaceutical, terminate operation or has no other realistic choice.
The management is responsible for supervising the financial reporting process of West Point pharmaceutical.
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 to design appropriate audit.
3. Evaluate the appropriateness of accounting policies selected by the management and the rationality of accounting estimates and related disclosures.
4. Draw a conclusion on the appropriateness of the going concern assumption used by the management. 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 West Point pharmaceutical. If we conclude that there are significant uncertainties, the auditing standards require us to draw the attention of report 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 lead to West Point's inability to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the financial statements, and evaluate whether the financial statements fairly reflect relevant transactions and events.
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.
Dahua Certified Public Accountants (special general partnership) Chinese certified public accountant: Gao Shimao
Beijing, China (project partner)
Chinese certified public accountant: Tian leibin
April 22, 2002
2、 The unit of the statement in the financial notes to the financial statements is: yuan 1. The preparation unit of the balance sheet is Jilin Xidian Pharmaceutical Technology Development Co., Ltd
Unit: Yuan
December 31, 2021 December 31, 2020
Current assets:
Monetary capital 1486 Cecep Techand Ecology&Environment Co.Ltd(300197) 210773607672
Provision for settlement
Lending funds
Trading financial assets 6500000000
Derivative financial assets
Notes receivable 21365769382168841064
Accounts receivable 37076209303490491479
Receivables financing
Prepayment 613031682426265535
receivable premium
accounts receivable reinsurance
Reinsurance contract reserve receivable
Other receivables 335839272618941245
Including: interest receivable
Dividends receivable
Purchase of resale financial assets
Inventory 26576427082019488915
Contract assets
Assets held for sale
Non current assets due within one year
Other current assets 6792221687352677599
Total current assets 3149293567026850313509
Non current assets:
Loans and advances
Debt investment
Other debt investment
long-term receivables
Long term equity investment
Investment in other equity instruments
Other non current financial assets
Investment real estate
