Huatai United Securities Co., Ltd
On site inspection report of Guangdong Changqing (Group) Co., Ltd. in 2021
In accordance with the requirements of relevant laws and regulations such as the measures for the administration of securities issuance and listing recommendation business (hereinafter referred to as the recommendation measures) and the guidelines for the recommendation of listed companies of Shenzhen Stock Exchange of the CSRC, Huatai United Securities Co., Ltd., as the sponsor of the public issuance of convertible corporate bonds by Guangdong Changqing (Group) Co., Ltd. (hereinafter referred to as ” Guangdong Chant Group Inc(002616) ” or “the company”), conducted on-site inspection on the relevant situation of Guangdong Chant Group Inc(002616) 2021 from December 28 to December 29, 2021, The report is as follows: name of recommendation institution: Huatai United Securities Co., Ltd. abbreviation of the recommended company: Guangdong Chant Group Inc(002616)
Name of sponsor representative: Han Feichong Tel: 18600127893
Name of sponsor representative: Lin Junjian Tel.: 13924173657
Name of on-site inspector: Lin Junjian, Zhang Heyuan corresponding period of on-site inspection: 2021
On site inspection time: December 28 to December 29, 2021
1、 On site inspection items and opinions
(I) is corporate governance not applicable
On site inspection means: mainly including interview with the Secretary of the board of directors of the company; Consult the articles of association, other management systems and the “three meetings” of the company; Verify the information on changes in directors, supervisors and senior management and relevant announcements; Check the shareholding of shareholders; Check other investments of controlling shareholders and actual controllers and the part-time work of directors, supervisors and senior managers; Consult the company’s property ownership certificate, financial and accounting system, etc.
1. Whether the articles of association and corporate governance system are complete and compliant √
2. Whether the articles of association and the rules of the third board of directors have been effectively implemented √
3. Whether the minutes of the third meeting are complete, whether the time, place, attendees and meeting contents are complete, and whether the meeting materials are kept completely
4. Is the resolution of the third meeting signed and confirmed by relevant personnel attending the meeting √
5. Whether the directors, supervisors and senior management of the company perform their duties in accordance with relevant laws, administrative regulations, departmental rules, normative documents and relevant business rules of the exchange 6 If the directors, supervisors and senior management of the company have made significant changes, have they fulfilled the obligations of √ disclosure of corresponding procedures and information
7. If the controlling shareholder or actual controller of the company changes, has it fulfilled the corresponding √
Procedures and information disclosure obligations
8. Whether the company’s personnel, assets, finance, organization and business are independent √
9. Whether there is no horizontal competition between the company and the controlling shareholders and actual controllers √
(II) on site inspection means of internal control: mainly including consulting the company’s internal audit system, checking the operation of the company’s internal audit department, and checking the personnel data of the audit department; Consult the internal audit plan and internal audit report; Consulted and filed documents, original vouchers and other materials related to the company’s internal control. 1. Whether the internal audit system and internal audit department are established in accordance with relevant regulations √ (if applicable) 2 Whether the internal audit system and internal audit system are established within 6 months after the listing of shares √
3. Accounting department (if applicable) Whether the personnel composition of the internal audit department and the audit committee is compliant (if applicable) √ 4 Whether the audit committee holds a meeting at least quarterly to review the work plan and report submitted by the internal audit department (if applicable) 5 Whether the audit committee reports the internal audit progress, quality and major problems found to the board of directors at least once a quarter (if applicable) 6 Whether the internal audit department reports the implementation of the internal audit work plan and the problems found in the internal audit work to the audit committee at least quarterly √ (if applicable) 7 Does the internal audit department audit the deposit and use of raised funds at least once a quarter (if applicable) 8 Whether the internal audit department submits the internal audit work plan for the next year to the audit committee two months before the end of each fiscal year (if applicable) 9 Whether the internal audit department submits the annual internal audit report (if applicable) to the audit committee within two months after the end of each fiscal year 10 Whether the internal audit department submits an internal control √ evaluation report to the audit committee at least once a year (if applicable) 11 Whether a complete and compliant internal control system has been established for venture capital, entrusted financial management, hedging business and other matters (III) on-site inspection means of information disclosure: mainly including consulting the company’s information disclosure system, consulting the relevant announcements disclosed by the company and the meeting minutes, approval process and seal use records related to the announcements, At the same time, check the relevant information disclosure websites of Shenzhen Stock Exchange.
1. Whether the announcement disclosed by the company is consistent with the actual situation √
2. Whether the contents disclosed by the company are complete √
3. Whether the disclosed matters of the company have not changed significantly or made important progress √
4. Whether there are no major events that should be disclosed but not disclosed √
5. Whether the transmission, disclosure process and confidentiality of major information comply with the relevant provisions of the company’s information √ disclosure management system 6 Whether the investor relations activity record form is published on the interactive website of the exchange in time √ (IV) on site inspection means for the establishment and implementation of the long-term mechanism to protect the company’s interests from infringement: mainly including interviewing the Secretary of the board of directors, consulting the relevant systems of internal control and the list of related parties, consulting the operation data of the third board of directors of the company Go to the deposit bank to obtain the bank statement of the special account for raised funds, and check the company’s large capital transactions. 1. Whether a system has been established to prevent controlling shareholders, actual controllers and their affiliates from directly or √ indirectly occupying the funds or other resources of the listed company 2 Whether the controlling shareholders, actual controllers and their affiliates do not directly or indirectly √ occupy the funds or other resources of the listed company 3 Whether the review procedures of related party transactions are in compliance and fulfill the corresponding information disclosure obligations √
4. Whether the price of related party transactions is fair √
5. Whether there is no related party transaction that is not related √
6. Whether the external guarantee review procedures are compliant and fulfill the corresponding information disclosure obligations √ 7 Whether the guaranteed party is free from deterioration of financial status and failure to pay off the guaranteed debt at maturity √
8 If the guaranteed debt continues to provide guarantee after maturity, whether the corresponding √ approval procedures and disclosure obligations have been fulfilled again (V) on-site inspection methods for the use of raised funds: mainly including consulting the relevant management system of raised funds, tripartite supervision agreement of raised funds, account details and bank statements of raised funds, special reports of raised funds, etc.
1. Whether the tripartite supervision agreement is signed within one month after the raised funds are in place √
2. Whether the tripartite supervision agreement on raised funds is effectively implemented √
3. Whether the raised funds are not occupied by a third party or entrusted financial management in violation of regulations √ 4 Whether there are no situations such as changing the purpose of raised funds without performing the review procedures, temporarily replenishing working capital, replacing pre investment, changing the implementation location, etc. 5 Use idle raised funds to temporarily supplement working capital and invest the raised funds in change
To permanently supplement working capital or use over raised capital to supplement working capital or √
If the bank loan is repaid, whether the company has not made venture investment during the commitment period 6 Whether the use of raised funds is consistent with the disclosed situation, and whether the project progress and investment benefit √ are consistent with the prospectus
7. Whether there are no major risks during the implementation of the project with raised funds √
(VI) on site inspection means of performance: mainly including consulting the company’s financial statements, important contracts and communicating with the management
1. Whether there are significant fluctuations in performance √
2. Is there a reasonable explanation for the large fluctuation of performance √
3. Compared with comparable companies in the same industry, whether there is no obvious abnormality in the company’s performance √ (VII) on-site inspection methods for the performance of the company and shareholders’ commitments: mainly including consulting the company’s register of shareholders, relevant commitments issued by shareholders, checking the performance of relevant commitments, etc.
1. Whether the company has fully fulfilled relevant commitments √
2. Whether the shareholders of the company have fully fulfilled relevant commitments √
(VIII) on site inspection means for other important matters: mainly including checking the establishment of cash dividend system, consulting the company’s large contracts, large capital transactions, payment vouchers and relevant approval procedures, communicating with the management to understand the company’s production and operation, etc.
1. Whether the cash dividend system has been fully implemented and truthfully disclosed √
2. Whether the external financial assistance is legal and compliant, and truthfully disclosed √
3. Whether large capital transactions have real transaction background and reasonable reasons √
4. Whether there is no significant change or √ during the performance of major investment or major contract
Person risk
5. Whether there is no significant change or risk in the company’s production and operation environment √
6. Whether the problems found by the early-stage regulators and sponsors have been solved according to the relevant √
The company’s net profit attributable to the parent company in the first three quarters decreased by 88.12% compared with the same period of last year, including a loss of 47.071 million yuan in the third quarter. After verification, the main reasons for the decline of the company’s profits are: (1) the sharp rise in coal prices. The price of thermal coal rose sharply in 2021. According to the Inner Mongolia Eerduosi Resources Co.Ltd(600295) thermal coal price index, the price of thermal coal in 2021 increased by about twice as much as that in 2020, and more than three times during the peak period, which greatly increased the cost of the company’s combined heat and power projects such as Mancheng, Maoming and Lixian, resulting in losses of these projects; (2) Affected by the rising energy price, the demand for alternative fuels such as biomass fuel has increased, coupled with the impact of abnormal weather, which has led to the rise of biomass fuel cost and the rise of biomass project cost of the company; (3) During the reporting period, many biomass thermal power projects of the company carried out technical upgrading, and some biomass projects put into operation for many years were overhauled, resulting in more downtime and increased maintenance and technical transformation costs; (4) The receivables of biomass subsidy electricity charges waiting for settlement increased, resulting in an increase in the provision of asset impairment losses. In 2021, due to the sharp rise of coal price, the performance of the whole coal power industry was greatly affected. According to the analysis and forecast report on the national power supply and demand situation in the third quarter of 2021 issued by China Power Council, the fuel cost of coal-fired power enterprises rose sharply in the first three quarters of 2021, and the loss surface of coal-fired power enterprises expanded significantly. Since August, the coal-fired power sector of large power generation groups has suffered overall losses, and the loss surface of coal-fired power of some groups has reached 100%. According to public information, listed companies dominated by thermal power, such as Huaneng Power International Inc(600011) , Huadian Power International Corporation Limited(600027) , Datang International Power Generation Co.Ltd(601991) and Gd Power Development Co.Ltd(600795) under the five power generation groups, suffered significant losses in the third quarter of 2021. The company’s profit decline in the first three quarters is the same as the industry trend, and there is no obvious abnormality. 2. The central heating project of Xiongxian Economic Development Zone, which is under construction by the company, can not be implemented due to the impact of xiongan New Area Planning and other policies. The company plans to terminate the project. As of June 30, 2021, the balance of projects under construction in Xiongxian county was 198170800 yuan. The company has hired relevant intermediaries to conduct impairment test on relevant assets of the project in accordance with the provisions of accounting standards, and will disclose the results in a timely manner. (no text below)
(there is no text on this page, which is the signature page of Huatai United Securities Co., Ltd. on the on-site inspection report of Guangdong Changqing (Group) Co., Ltd. in 2021) sponsor representative (signature):
Han Feichong, Lin Junjian
Huatai United Securities Co., Ltd. (official seal) January 12, 2022
