Stock abbreviation: Liaoning Sg Automotive Group Co.Ltd(600303) securities code: Liaoning Sg Automotive Group Co.Ltd(600303) No.: pro 2022030 Liaoning Sg Automotive Group Co.Ltd(600303)
Announcement on the provision for asset impairment
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Liaoning Sg Automotive Group Co.Ltd(600303) (hereinafter referred to as “the company”) deliberated and adopted the proposal on the provision for asset impairment at the fifth meeting of the 10th board of directors and the second meeting of the 10th board of supervisors held on April 29, 2022. The specific contents are hereby announced as follows:
1、 Overview of the provision for asset impairment this time
In order to objectively reflect the financial situation and operating results of the company in 2021, according to the accounting standards for business enterprises and other relevant provisions, based on the principle of prudence, the company conducted an impairment test on relevant assets that may show signs of impairment at the end of the year. After testing, the company plans to withdraw 151.69 million yuan of impairment provision in 2021. The company’s provision for impairment has been audited by Dahua Certified Public Accountants (special general partnership).
2、 Description of specific conditions of withdrawing asset impairment reserves
1. Method, basis and standard of withdrawing impairment provision
According to the accounting standards for Business Enterprises No. 1 inventory: it is measured according to the lower of the cost and net realizable value on the balance sheet date. When the net realizable value is lower than the cost, the inventory falling price reserves are accrued.
According to the accounting standards for Business Enterprises No. 8 asset impairment: if there are signs of asset impairment, its recoverable amount shall be estimated. The recoverable amount shall be determined according to the higher one between the net amount of the fair value of the asset minus the disposal expenses and the present value of the expected future cash flow of the asset. If the measurement result of the recoverable amount shows that the recoverable amount of the asset is lower than its book value, the book value of the asset shall be written down to the recoverable amount, and the written down amount shall be recognized as asset impairment loss and included in the current profit and loss, and the corresponding asset impairment provision shall be withdrawn at the same time.
2. Details of provision for impairment
In 2021, the company conducted an impairment test on assets with signs of impairment, and plans to withdraw an impairment provision of 151.69 million yuan, mainly due to the impairment loss of fixed assets, inventory depreciation loss and contract assets impairment loss, including 123.16 million yuan of fixed assets impairment loss, 28.64 million yuan of inventory depreciation loss and 110000 yuan of contract assets impairment loss. Other assets other than the above have no impairment at the end of the year, so no impairment is accrued.
Dandong Hangao port real estate Co., Ltd. hired Beijing Zhongfeng Asset Appraisal Co., Ltd. to conduct asset impairment test. The record number is Zhongfeng pingbao Zi (2022) No. 40026, and there is no impairment.
Dandong Huanghai Automobile Co., Ltd. hired Beijing Zhongfeng Asset Appraisal Co., Ltd. to conduct asset impairment test, with record No. Zhongfeng pingbao Zi (2022) No. 40039, and accrued provision for impairment of fixed assets.
Others are the normal provision for impairment according to the accounting standards for business enterprises and the company’s accounting policies.
3、 Impact of provision for impairment on the company’s financial position
The provision for asset impairment in this period is in line with the actual situation of assets and the provisions of relevant accounting policies. The provision for asset impairment in the current period can more fairly reflect the asset status of the company. The provision for asset impairment in the current period totaled 151.69 million yuan, reducing the company’s net profit attributable to shareholders of Listed Companies in 2021 by 151.69 million yuan.
4、 Opinions of independent directors and board of supervisors
1. Opinions of independent directors
The independent directors of the company believe that the provision for asset impairment this time complies with the relevant provisions of the accounting standards for business enterprises and the company’s financial management system, and the relevant review procedures are legal and compliant. After the provision for asset impairment is withdrawn this time, the company’s financial statements can more fairly reflect the company’s financial situation and operating results, and help to provide investors with more authentic, reliable and accurate accounting information. There is no situation that damages the interests of the company and all shareholders, especially small and medium-sized shareholders. We agree to withdraw the provision for asset impairment this time.
2. Opinions of the board of supervisors
The board of supervisors of the company believes that the company’s provision for asset impairment in accordance with the accounting standards for business enterprises and the relevant provisions of the company’s financial system is in line with the actual situation of the company, can more fairly reflect the company’s financial status and asset value, and the relevant decision-making procedures comply with the provisions of laws and regulations. It agrees to withdraw the provision for asset impairment this time.
It is hereby announced.
Liaoning Sg Automotive Group Co.Ltd(600303)
April 29, 2022
