catalogue
1、 Audit report Page 1-5 II. Simulated consolidated financial statements Page 6-8
(I) simulated consolidated balance sheet Page 6
(II) simulated consolidated income statement Page 7
(III) simulated consolidated cash flow statement Page 8
3、 Notes to simulated consolidated financial statements Page 9-73
Audit report
TJS [2022] No. 6325
All shareholders of Hangzhou Changyi Technology Co., Ltd.:
1、 Audit opinion
We have audited the simulated consolidated financial statements prepared by Hangzhou Changyi Technology Co., Ltd. (hereinafter referred to as Changyi Technology Co., Ltd.) according to the preparation basis described in Note 2 to the simulated consolidated financial statements, including the simulated consolidated asset and liability statements on December 31, 2020, December 31, 2021 and February 28, 2022, the simulated consolidated income statements and simulated consolidated cash flow statements for 2020, 2021 and January February 2022, And notes to the simulated consolidated financial statements.
In our opinion, the attached simulated consolidated financial statements are prepared on the basis described in note II to the simulated consolidated financial statements in all material aspects.
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 simulated consolidated 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 Changyi technology 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 our audit opinion.
3、 Key audit matters
The key audit matters are the most important matters that we consider to audit the simulated financial statements in 2020, 2021 and January February 2022 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.
(I) recognition of operating income
1. Key audit matters
The operating income listed in the simulation statement of Changyi technology company comes from the sales income of various sorter equipment of its subsidiary exis tech SDN.BHD. (hereinafter referred to as exis company). As stated in note V (II) of the financial statements, the main business income of various sorter equipment and related parts of exis company in 2020, 2021 and January February 2022 was 2055476 million yuan, 3389484 million yuan and 47.408 million yuan respectively, accounting for 99.68%, 99.87% and 99.86% of its operating income respectively.
The main business income is the profit source of exis company. We identify the authenticity and accuracy of the recognition of the main business income of exis company as the key audit matters.
2. Audit response
For the recognition of operating revenue, our audit procedures mainly include:
(1) Understand, evaluate and test the key internal control procedures and their implementation of the sales and collection cycle of exis company;
(2) Check the important sales contracts signed between exis company and customers, understand and evaluate whether the revenue recognition policies of exis company comply with the provisions of the accounting standards for business enterprises in combination with the business processes learned from the interviews with the management of exis company, and check whether they are consistent in the early and later stages;
(3) Conduct sampling detail test for sales revenue and check with relevant sales contracts, sales invoices, acceptance reports and bank collection documents;
(4) Conduct field or video interviews with major customers to verify the authenticity of sales;
(5) According to the nature of the customer’s letter of credit and the amount of the transaction, select the sample to confirm the account receivable according to the characteristics of the customer’s letter of credit;
(6) Perform a cut-off test on the sales revenue recognized before and after the balance sheet date, and check to the relevant sales contracts, sales invoices, acceptance reports and bank collection documents to check whether the sales revenue is recognized in an appropriate period;
(7) Check whether the information related to operating income has been properly presented in the financial statements.
（2） Existence and valuation of inventory
1. Key audit matters
The inventories of Changyi technology company are held by exis company. The book values of inventories in the simulated consolidated financial statements at the end of 2020, 2021 and February 2022 were 921481 million yuan, 1341916 million yuan and 1298949 million yuan respectively, accounting for 37.28%, 38.61% and 37.32% of the total assets in the simulated consolidated financial statements respectively. It is one of the main assets of Changyi technology company. Whether the inventory really exists and its pricing accuracy have a significant impact on the operating results, so we identify the existence and pricing accuracy of the inventory as key audit matters.
2. Audit response
For the existence and valuation of inventories, our audit procedures mainly include:
(1) Understand and evaluate the key internal control procedures and implementation of exis’s procurement and production cycle; (2) Entrust overseas accountants to implement the supervision procedures for all kinds of inventories and participate in the supervision procedures in the whole process by video to verify the authenticity, accuracy and inventory status of inventories;
(3) Carry out valuation test on major inventories and verify the accuracy of inventory carry forward and balance amount;
(4) Implement substantive analysis procedures for raw material procurement, check the stability of procurement price and the rationality of procurement price differences between different suppliers;
(5) Spot check the completion cost calculation sheet of inventory goods to verify its pricing accuracy;
(6) Implement on-site or video interview procedures and letter confirmation procedures for major customers on the issued goods to determine the authenticity and accuracy of the issued goods;
(7) Obtain various inventory aging tables, review the calculation of inventory falling price reserves by the management of exis company, and evaluate the rationality of assumptions and estimates used in the calculation process;
(8) Check whether the information related to inventory has been properly presented in the financial statements.
4、 Highlights – basis of preparation
We remind statement users to pay attention to the description of the preparation basis in Note 2 of the simulated consolidated financial statements. The simulated consolidated financial statements are only for the purpose of simulating the asset restructuring described in Note 2 to the consolidated financial statements, and are not applicable to other purposes. The contents of this paragraph shall not affect the issued audit opinion.
5、 Other matters – restrictions on the sending object and use of audit reports
Our report is only used to simulate the asset restructuring described in Note 2 to the consolidated financial statements, and should not be sent to or used by other parties other than the parties related to the asset restructuring.
6、 Responsibilities of management and governance for simulating consolidated financial statements
The management of Changyi technology company (hereinafter referred to as the management) is responsible for preparing the simulated consolidated financial statements according to the preparation basis described in Note 2 to the simulated consolidated financial statements, and designing, implementing and maintaining necessary internal control so that the simulated consolidated financial statements are free from material misstatement due to fraud or error.
When preparing the simulated consolidated financial statements, the management is responsible for evaluating the sustainable operation ability of Changyi technology company, disclosing matters related to sustainable operation (if applicable), and applying the assumption of sustainable operation, unless it plans to liquidate, terminate operation or has no other realistic choice.
The governance layer of Changyi technology company (hereinafter referred to as the governance layer) is responsible for supervising the financial reporting process of Changyi technology company.
7、 Responsibilities of certified public accountants for the audit of simulated consolidated financial statements
Our goal is to obtain reasonable assurance on whether the simulated consolidated financial statements 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 statement users based on the simulated consolidated 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 evaluate the risks of material misstatement of the simulated consolidated financial statements caused by 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 in order to design appropriate audit procedures, but the purpose is not to express an opinion on the effectiveness of internal control.
（3） Evaluate the appropriateness of accounting policies selected by the management and the rationality of accounting estimates and related disclosures.
（4） Draw conclusions on the appropriateness of management’s use of going concern assumptions. 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 Changyi technology company. If we conclude that there is significant uncertainty, the auditing standards require us to draw the attention of statement users to the relevant disclosures in the simulated consolidated 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 cause Changyi technology company to be unable to continue its business.
（5） Obtain sufficient and appropriate audit evidence on the financial information of entities or business activities in Changyi technology company to express an audit opinion on the simulated consolidated financial statements. We are responsible for guiding, supervising and implementing the group audit, and take full responsibility for the audit opinions.
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). Tianjian Certified Public Accountants (special general partnership) Chinese certified public accountant:
(project partner)
Hangzhou, China Certified Public Accountant:
May 22, 2002
Hangzhou Changyi Technology Co., Ltd
Notes to simulated consolidated financial statements
January 1, 2020 to February 28, 2022
Monetary unit: RMB 1. Basic information of the company
Hangzhou Changyi Technology Co., Ltd. (formerly known as Hangzhou Changyi Equity Investment Co., Ltd., hereinafter referred to as the company or the company) is jointly invested and established by Hangzhou paradise Silicon Valley Hangshi equity investment partnership (limited partnership) and Paradise Silicon Valley Asset Management Group Co., Ltd. It was registered with Hangzhou high tech Zone (Binjiang) market supervision and Administration Bureau on August 24, 2020 and headquartered in Hangzhou, Zhejiang Province. The company now holds a business license with a unified social credit code of 91330108ma2j0xg0x1 and a registered capital of 2144749 million yuan.
The company is a technology promotion and application service industry. The services provided mainly include: technical services, technology development, technical consultation, technical exchange, technology transfer and technology promotion; Manufacturing of special equipment for semiconductor devices; Sales of special equipment for semiconductor devices; Special equipment manufacturing (excluding licensed professional equipment manufacturing); Software development. (except for the items that must be approved according to law, the company shall independently carry out business activities according to law with its business license)
The scope of the company’s inclusion in the simulated consolidated financial statements is as follows:
No. full name of subsidiary company company abbreviation: business location
Country (region)
1. Research and development of sorting machine equipment of exis tech Sdn. Bhd. Exis, Malaysia
Production and sales
1-1 exis Tech (HK) Pte Limited Investment Management Hong Kong, China
company
1-1-1 sales service of exis Suzhou sorter equipment of Suzhou cantuyigao Intelligent Equipment Co., Ltd. Suzhou, China
Corporate Affairs
See the description of equity in other entities in the notes to the financial statements for details.
2、 Preparation basis of simulated consolidated financial statements
（1） Preparation basis of simulated consolidated financial statements
To meet the requirements of Hangzhou Hangzhou Chang Chuan Technology Co.Ltd(300604) Co., Ltd
