Modern Avenue Group Co.Ltd(002656)
Audit report
Zhsz (2022) No. 0510282
catalogue
Starting page audit report 1
financial statements
Consolidated balance sheet 1
Consolidated income statement 3
Consolidated cash flow statement 4
Consolidated statement of changes in shareholders' equity 5
Balance sheet 7
Income statement 9
Cash Flow Statement 10
Statement of changes in shareholders' equity 11
Note 13 to the financial statements
Audit report
Zhong Huan Shen Zi (2022) No. 0510282 Modern Avenue Group Co.Ltd(002656) all shareholders:
1、 Reservations
We have audited the financial statements of Modern Avenue Group Co.Ltd(002656) (hereinafter referred to as "your company"), including the consolidated and company's balance sheet as of December 31, 2021, the consolidated and company's income statement, consolidated and company's cash flow statement, consolidated and company's statement of changes in shareholders' equity and notes to relevant financial statements in 2021.
In our opinion, in addition to the possible impact of the matters described in the "basis for forming a qualified 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 the company's financial position as of December 31, 2021 and the consolidated and the company's operating results and cash flow in 2021.
2、 Basis for forming reservations
Investment in Nanjing Jiayuan New Energy Vehicle Co., Ltd
As described in notes VI and 9 to the financial statements and notes XV, 8 and (6), your company increased the capital of Nanjing Jiayuan New Energy Vehicle Co., Ltd. (hereinafter referred to as the "target company") by RMB 24 million through the subsidiary Foshan Taiyuan No. 1 equity investment partnership (limited partnership), accounting for 16.70% of the equity of the target company.
As we have not obtained the financial report and other relevant financial information of the subject company and the relevant information on the use of funds of RMB 24 million as of the date of issuance of this report, we are unable to judge the impact of the above matters on the changes in the fair value of other equity instrument investments and whether there are other related relationships (except the related relationships disclosed in the notes), and our audit scope is limited.
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 your 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 expressing qualified opinions.
3、 Other information
The management of your company is responsible for other information. Other information includes the information covered in the 2021 annual report, but does not include page 1 of 6 of the audit report
Including 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. As mentioned in the above "basis for forming qualified opinions", we are unable to obtain sufficient and appropriate audit evidence on your company's investment in Nanjing Jiayuan New Energy Vehicle Co., Ltd. Therefore, we are unable to determine whether there is any material misstatement in other information related to the matter.
4、 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. In addition to the "basis for forming qualified opinions", we determined that the following matters are the key audit matters that need to be communicated in the audit report.
(I) bad debt provision for other receivables
Key audit matters how to deal with them in the audit
Please refer to "notes IV and 10" in the financial report. Our audit procedures include:
"Note VI, 5 (2)" and "note VI, 41". 1) Tested and evaluated the impairment of the company's other receivables. As of December 31, 2021, your company had complied with the key internal control, reviewed the management's analysis and evaluation process for the recoverability of other receivables and the book balance of other receivables in the balance sheet;
44727886686 yuan, bad debt provision 2) for the 31471013361 yuan of individually assessed credit risk and withdrawn bad debt provision, the book value of other receivables, we understand the reasons for the judgment of the management and evaluate 13256873325 yuan. Among them, the rationality of bad debt provision in other receivables;
Due from the controlling shareholder Guangzhou Ruifeng Group Co., Ltd. 3) for the total amount of its company (hereinafter referred to as "Ruifeng group") that assesses the risk and withdraws bad debts in a portfolio way is other receivables, we evaluated the rationality of portfolio division and tested the accuracy of 24198378791 yuan, accounting for the expected credit loss rate of the total amount of other receivables;
54.10%, and the bad debt provision is 24198378791 yuan. 4) for other receivables that are individually assessed for credit risk and fully withdrawn, it accounts for 76.89% of the bad debt provision for other receivables.
For the receivables of your company, we checked the litigation situation of the debtor, evaluated the separate impairment test of the amount by the debt company, and found the repayment ability of the debtor;
Audit report page 2 of 6
Key audit matters how to deal with them in the audit
The amount is obviously impaired, and it is expected that it can not be 5) recovered by letter of credit for other important receivables in the reporting period, so the other receivables could not be collected at the end of the period.
Withdraw part of bad debt reserves. Due to the bad of other receivables, 6) in combination with the inspection of the collection after the period, it is evaluated that the amount of the management's provision for accounts receivable is large, which has a greater impact on the financial statements and the rationality of the provision for bad debts of accounts receivable.
Significant, and the provision of bad debt reserves involves the management 7) checking the significant judgments and estimates related to the bad debt reserves of other receivables in the financial report, so we the adequacy of the information disclosure of this matter. Identified as key audit matters.
(II) provision for inventory falling price reserves
Key audit matters how to deal with them in the audit
Please refer to "notes IV and 12" in the financial report. Our audit procedures include:
"Note VI, 6" and "note VI, 42". 1) Tested and evaluated the effectiveness of the design and implementation of your company's compliance control as of December 31, 2021;
And the book value of the inventory in the financial statements is 2) the sampling supervision procedure is implemented for the inventory, and the number of the inventory is 11870569429 yuan, of which the book balance of the inventory is the quantity and status, etc;
26816920036 yuan, inventory falling price reserve 3) by comparing the recent sales unit price of similar products and products in the same state, 14946350607 yuan. As your company's inventory balance and significant changes in the future price trend of products according to seasonal characteristics, and the provision for inventory falling price involves the review of the management, evaluate the method of the management to estimate the net realizable value; Therefore, inventory 4) re measuring the provision for falling price according to your company's inventory provision policy is regarded as a key audit event. Calculate the inventory falling price reserves and analyze whether the provision for inventory falling price reserves is sufficient;
5) Obtain the inventory age list of the inventory and carry out analytical procedures to judge whether there is a risk that the long inventory age will reduce the net realizable value of the inventory.
6) Check the adequacy of information disclosure related to inventory falling price reserves in the financial report.
(III) reversal of estimated liabilities
Key audit matters how to deal with them in the audit
Audit report page 3 of 6
Key audit matters how to deal with them in the audit
Please refer to "note IV 27" in the financial report. Our audit procedures include:
"Notes VI, 27", "notes VI, 44" and "attachment 1) understand and inquire about the progress of relevant litigation of the management and notes XIII and 2". Recognition basis and method of estimated liabilities;
As of December 31, 2021, your company has obtained the documents related to litigation cases from 2) and the legal opinions issued by the lawyers handling the litigation matters to confirm the estimated balance of liabilities. The appraisal management confirmed 10223111125 yuan. Whether the provision of estimated liabilities related to litigation matters is appropriate;
The estimated amount of liabilities has a great impact on the financial statements. 3) inquire about the litigation situation of your company through public channels to evaluate that the relevant litigation cases have not yet formed an effective judgment or assess the integrity of the management's disclosure of litigation matters;
Before withdrawing the lawsuit, the impact of pending litigation matters on the financial statements can be 4) check whether your company's impact on the accounting treatment related to pending litigation matters involves the appropriateness of major judgments, presentation and disclosure made by the management. Therefore, we recognize it as a key audit matter.
In addition to the "basis for forming qualified opinions", we determine that there are no other key audit matters that need to be communicated in our audit report.
5、 Responsibilities of management and governance for financial statements
The management of your company (hereinafter referred to as "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.
In preparing the financial statements, the management is responsible for assessing the company's ability to continue as a going concern, disclosing matters related to going concern (if applicable), and applying the going concern assumption, unless the management plans to liquidate the company, terminate the operation or has no other realistic choice.
The management is responsible for supervising the financial reporting process of your 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:
(I) 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 for publication
