Aoyuan Beauty Valley Technology Co.Ltd(000615) : Announcement on changes in accounting policies

Securities code: Aoyuan Beauty Valley Technology Co.Ltd(000615) securities abbreviation: Aoyuan Beauty Valley Technology Co.Ltd(000615) Announcement No.: 2022038 Aoyuan Beauty Valley Technology Co.Ltd(000615)

Announcement on changes in accounting policies

The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.

Aoyuan Beauty Valley Technology Co.Ltd(000615) (hereinafter referred to as "the company") has made corresponding changes to the company's accounting policies in accordance with the provisions of the Ministry of finance of the people's Republic of China (hereinafter referred to as "the Ministry of finance"), and the specific conditions are hereby announced as follows:

1、 Overview of changes in accounting policies

1. Reason for change

On December 30, 2021, the Ministry of Finance issued the notice on printing and distributing the interpretation of accounting standards for Business Enterprises No. 15 (CAI Kuai [2021] No. 35) (hereinafter referred to as "interpretation of Standards No. 15"), which clarified the accounting treatment of the external sales of products or by-products produced before the fixed assets reach the expected serviceable state or in the process of research and development.

Due to the revision of the above accounting standards, the company needs to adjust the relevant accounting policies originally adopted. 2. Change date

According to the above relevant standards and notice provisions of the Ministry of finance, the company will implement the above accounting standards for business enterprises from January 1, 2022.

3. Accounting policies adopted before change

Before this change, the company implemented the accounting standards for business enterprises - basic standards, various specific accounting standards, application guidelines of accounting standards for business enterprises, interpretation announcement of accounting standards for business enterprises and other relevant regulations issued by the Ministry of finance.

4. Accounting policies adopted after change

After this change, the company changed the accounting policies implemented for the accounting treatment of the external sales of products or by-products produced before the fixed assets reach the expected serviceable state or during the research and development process to the relevant provisions of the interpretation standard No. 15. Other unchanged parts shall still be implemented in accordance with the accounting standards for business enterprises - basic standards, various specific accounting standards, the application guide of accounting standards for business enterprises, the interpretation announcement of accounting standards for business enterprises and other relevant provisions issued by the Ministry of Finance in the early stage.

5. Main contents of change

If an enterprise sells the products or by-products produced before the fixed assets reach the expected serviceable state or during the research and development process, such as the samples produced when testing whether the fixed assets operate normally, or sells the products or by-products produced during the research and development process (hereinafter referred to as trial operation sales), it shall be in accordance with the accounting standards for Business Enterprises No. 14 - revenue The accounting standards for Business Enterprises No. 1 - inventory and other applicable accounting standards shall separately account for the income and cost related to trial operation sales and record them into the current profits and losses. The net amount of the income related to trial operation sales after offsetting the relevant costs shall not be used to offset the cost of fixed assets or R & D expenses. The enterprise shall make retroactive adjustment in accordance with the provisions of this interpretation for the trial operation sales that occur between the beginning of the earliest period for the presentation of the financial statements for the first time to the implementation date of this interpretation (January 1, 2022).

2、 Impact of this accounting policy change on the company

This accounting policy change will be implemented from January 1, 2022. For the trial operation sales between the beginning of the earliest period for the presentation of the financial statements for the first time to the implementation date of this interpretation, the company will make retroactive adjustment in accordance with the provisions of standard Interpretation No. 15.

The retroactive adjustment of this accounting policy change will affect the financial statements on January 1, 2022, including an increase of 231420 million yuan in inventory, a decrease of 753857 million yuan in fixed assets and a decrease of 52.546 million yuan in undistributed profits.

It is hereby announced.

Aoyuan Beauty Valley Technology Co.Ltd(000615) board of directors

April 30, 2002

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