Yunnan Xiyi Industrial Co.Ltd(002265)
Pro forma financial statement Review Report
Zhongxinghua Certified Public Accountants (special general partnership)
Zhongxinghuacitified public accounts LLP address: 20 / F, tower sohob, Lize, No. 20, Lize Road, Fengtai District, Beijing zip code: 100073 Tel: (010) 51423818 Fax: (010) 51423816
catalogue
1、 Review report of pro forma financial statements II. Pro forma financial statements
1. Pro forma consolidated balance sheet
2. Pro forma consolidated income statement
3. Notes III to the financial statements for reference and annexes to the review report
1. Copy of business license of zhongxinghua Certified Public Accountants (special general partnership)
2. Copy of practicing certificate of zhongxinghua Certified Public Accountants (special general partnership)
3. Copy of certified public accountant’s practice certificate
Beijing Institute of Certified Public Accountants
Business report unified coding reporting system
Unified code of business reporting: 11000167202909007074
Yunnan Xiyi Industrial Co.Ltd(002265) pro forma financial statement report name:
Review Report
Report No.: zthy Zi (2022) No. 010011
Name of audited (inspected) unit: Yunnan Xiyi Industrial Co.Ltd(002265)
Name of accounting firm: zhongxinghua accounting firm (special general partnership)
Business type: other assurance business
Report date: May 23, 2022
Filing date: May 21, 2022
Zhang Wenxue (420003204575),
Signed by:
Zhang Zhen (110100100002)
(information can be queried by scanning QR code or logging into the official website of Beijing injection Association)
Note: this filing information only proves that the report has been filed with the Beijing Institute of certified public accountants, and does not mean that the Beijing Institute of Certified Public Accountants makes any form of guarantee for the content of the report in any sense.
Yunnan Xiyi Industrial Co.Ltd(002265)
Notes to pro forma financial statements
(unless otherwise specified, the monetary unit is RMB)
1、 Basic information of the enterprise
1. Place of registration, organizational form and headquarters address of the company
Yunnan Xiyi Industrial Co.Ltd(002265) (hereinafter referred to as “the company” or “the company”) was approved in March 2005 by the state owned assets supervision and Administration Commission of the State Council in the document of state owned assets reform [2005] No. 328 and the document of state owned assets right [2005] No. 201, By China Ordnance Equipment Group Co., Ltd. (hereinafter referred to as “Ordnance Group”) , Nanfang Industrial Assets Management Co., Ltd., Yunnan state owned Assets Management Co., Ltd., Wuhan Changjiang photoelectric Co., Ltd. and Kunming yifengda Trading Co., Ltd. The company was listed on Shenzhen Stock Exchange in July 2008 and now holds a business license with a unified social credit code of 9153 Shenzhen Kaifa Technology Co.Ltd(000021) 6521606p.
As of March 31, 2022, the company has issued a total of 318566172 shares, with a registered capital of 318566172 yuan. Its registered address is shanchong, Haikou Town, Xishan District, Kunming, and its headquarters address is shanchong, Haikou Town, Xishan District, Kunming.
The company’s main business activities are: production and operation of automobile engine connecting rod series products, other industrial products, machine tool series products and parts.
The parent company of the company is Nanfang Industrial Asset Management Co., Ltd., and the ultimate controlling party of the company is Ordnance Group.
2. Consolidated report range
See “VIII. Change of consolidation scope” in this note for the change of consolidation scope during the reporting period.
For the relevant information of the company’s subsidiaries, see “IX. interests in other entities” in this note.
2、 Major asset restructuring
(I) major asset restructuring plan
According to the plan of Yunnan Xiyi Industrial Co.Ltd(002265) issuing shares and paying cash to purchase assets and raise supporting funds and related party transactions approved by the board of directors on December 4, 2021, the company plans to purchase 100% equity of Chongqing construction industry (Group) Co., Ltd. (hereinafter referred to as “Chongqing Construction Industry”) held by it by issuing shares and paying cash to Ordnance Group. In this transaction, the company plans to raise matching funds by non-public offering of shares to no more than 35 specific investors. The total amount of matching funds raised shall not exceed 100% of the transaction price of purchasing assets by issuing shares in this transaction, and the number of shares issued shall not exceed 30% of the total share capital of the company before this transaction. The benchmark date for the pricing of the issuance of shares and the payment of cash for the purchase of assets is the announcement date of the resolution of the first interim board meeting of the company in 2021. The issuance price of the issued shares and the payment of cash for the purchase of assets in this transaction is 6.77 yuan / share. 1. Issuing shares and paying cash to purchase assets
According to the assets appraisal report issued by Zhongshui Zhiyuan Assets Appraisal Co., Ltd. (Zhongshui Zhiyuan pingbao Zi [2022] No. 010012), taking November 30, 2021 as the appraisal base date, the appraisal result of the total equity value of shareholders of Chongqing construction industry is 4964716700 yuan. Based on the above appraisal value and through negotiation between the parties to the transaction, the transaction price of 100% equity of Chongqing construction industry is 4964716700 yuan,
Among them, the company paid 70 million yuan in cash to the Ordnance Group, and the remaining 42647167 million yuan was paid by issuing shares at the issuing price of 6.77 yuan / share.
2. Issue shares to raise supporting funds
In this transaction, the company plans to raise supporting funds by non-public offering of shares to no more than 35 specific investors. The total amount of supporting funds to be raised in this transaction shall not exceed 1 million yuan, not more than 100.00% of the transaction price of purchasing assets by issuing shares, that is, not more than 4264716700 yuan, and the number of shares issued shall not exceed 30% of the total share capital of the company before this transaction, that is, not more than 95569851 shares. Among the supporting funds raised this time, 70 million yuan is used to pay the cash consideration of this transaction, and the rest is used to supplement the working capital of the company and Chongqing construction industry and pay intermediary fees and relevant transaction taxes.
The raising of supporting funds is based on the successful implementation of the transaction of issuing shares and paying cash to buy assets, but the success of raising supporting funds does not affect the implementation of the transaction of issuing shares and paying cash to buy assets.
(II) basic information of the assets to be placed
Chongqing Construction Industry Department separated the scientific research and production part of special products from the original construction industry (Group) Co., Ltd. according to the requirements of [2003] No. 1039 document of the Commission of science, technology and industry for national defense. The newly established wholly state-owned company was invested and established by Ordnance Group. On December 28, 2005, it obtained the business license of enterprise legal person with the registration number of 915 Shenzhen Quanxinhao Co.Ltd(000007) 842028302 from Chongqing Administration for Industry and commerce, Registered address: No. 1 Jianshe Avenue, Huaxi Industrial Park, Banan District, Chongqing, with the original registered capital of 120 million yuan.
In 2015, according to the decision on the merger of Chongqing construction industry (Group) Co., Ltd. and Chongqing Changfeng Machinery Co., Ltd. (bingzhuang Ji [2014] No. 364) of Ordnance Group, Chongqing construction industry absorbed and merged Chongqing Changfeng Machinery Co., Ltd. (hereinafter referred to as “Chongqing Changfeng Machinery”), Chongqing Changfeng Machinery was cancelled. In January 2015, Chongqing construction industry fully completed all assets Succession of liabilities. On April 23, 2015, the registered capital of Chongqing construction industry was changed to RMB 20115587666. Chongqing construction industry headquarters address: Chongqing, legal representative: Che Lianfu.
3、 Preparation basis of pro forma financial statements
The pro forma financial statements are prepared on the assumption that the reorganization has been completed on January 1, 2021 (hereinafter referred to as the “merger base date”), and based on the equity structure after the reorganization and on the premise of sustainable operation, according to the following assumptions:
1. The relevant proposals described in Note 2 to the pro forma financial statements can be approved by the general meeting of shareholders of the company and the China Securities Regulatory Commission.
2. It is assumed that on January 1, 2021, the company has completed the issuance of 629943382 A shares with a par value of RMB 1 per share, the issuance price is RMB 6.77 per share, and the procedures related to the purchase of assets have been completed on January 1, 2021.
3. The pro forma financial statements are based on the 2021 financial statements of the company audited by Dahua Certified Public Accountants (special general partnership) and the simulated consolidated financial statements of Chongqing construction industry in 2021 and January March 2022 audited by zhongxinghua Certified Public Accountants (special general partnership), and are prepared by adopting the important accounting policies, accounting estimates and preparation methods of consolidated financial statements described in this note.
4. Since both the company and Chongqing construction industry are controlled by Ordnance Group before and after the transaction, this pro forma consolidated financial statement incorporates the assets and liabilities of Chongqing construction industry into the pro forma consolidated financial statement according to the book value in accordance with the relevant accounting treatment requirements of business combination under the same control, On January 1, 2021, Chongqing construction industry adjusted the capital reserve and retained earnings for the part of the book value of the owner’s equity attributable to the parent company exceeding the face value of the above issued shares.
5. The pro forma financial statements do not consider the non-public offering of shares to raise matching funds for restructuring.
6. The pro forma financial statements do not take into account the relevant taxes that may arise in this restructuring.
Based on the special preparation purpose of the pro forma financial statements, the pro forma financial statements do not include the pro forma consolidated cash flow statement and the pro forma consolidated statement of changes in shareholders’ equity, and only the pro forma consolidated financial information is presented, but the financial information of the parent company of the company is not presented.
Since the reorganization plan is yet to be approved by the general meeting of shareholders of the company and the CSRC, the final approved reorganization plan, including the shares actually issued by the company and their pricing, as well as the issuance expenses, may be different from the above assumptions adopted in the pro forma financial statements, the relevant assets and liabilities will be adjusted when they are actually recorded after the completion of the reorganization.
4、 Statement of compliance with accounting standards for business enterprises
The pro forma financial statements are prepared in accordance with the accounting standards for business enterprises and the preparation basis described in note III, which truly and completely reflect the company’s pro forma financial status, operating results and other relevant information.
5、 Important accounting policies and accounting estimates
1. Accounting period
The accounting period of the company is divided into annual period and interim period, which refers to the reporting period shorter than a complete accounting year. The accounting year of the company adopts the Gregorian calendar, i.e. from January 1 to December 31 each year.
2. Business cycle
Normal business cycle refers to the period from the purchase of assets for processing to the realization of cash or cash equivalents. The company takes 12 months as an operating cycle and takes it as the liquidity division standard of assets and liabilities.
3. Recording currency
RMB is the currency of the main economic environment in which the company and its domestic subsidiaries operate. The company and its domestic subsidiaries use RMB as the bookkeeping base currency. The currency used by the company in preparing the financial statements is RMB.
4. Accounting treatment methods for business combinations under the same control and not under the same control
Business combination refers to the transaction or event in which two or more separate enterprises are combined to form a reporting entity. Business combinations are divided into business combinations under the same control and business combinations not under the same control.
(1) Business combination under the same control
A business combination under the same control is a business combination in which the enterprises participating in the merger are ultimately controlled by the same party or the same parties before and after the merger, and the control is not temporary. For business combinations under the same control, the party that obtains control over other enterprises participating in the merger on the merger date is the merging party, and other enterprises participating in the merger are the merged party. The merger date refers to the date on which the combining party actually obtains control over the merged party. The assets and liabilities acquired by the company in business combination shall be measured according to the book value of the combined party’s assets and liabilities (including the goodwill formed by the final controller’s acquisition of the combined party) in the final controller’s consolidated financial statements on the combination date; For the difference between the book value of the net assets obtained and the book value of the merger consideration paid (or the total face value of the issued shares), the share capital premium in the capital reserve shall be adjusted. If the share capital premium in the capital reserve is insufficient to be offset, the retained earnings shall be adjusted.
All direct expenses incurred by the combining party for business combination shall be included in the current profit and loss when incurred.
(2) Business combination not under the same control
A business combination not under the same control is a business combination in which the enterprises participating in the merger are not ultimately controlled by the same party or the same parties before and after the merger. For business combinations not under the same control, the party that obtains control over other enterprises participating in the merger on the acquisition date is the purchaser, and other enterprises participating in the merger are the acquiree. The date of purchase refers to the date on which the purchaser actually obtains control over the acquiree.
For business combination not under the same control, the combination cost includes the fair value of assets paid, liabilities incurred or assumed and equity securities issued by the acquirer to obtain the control over the acquiree on the acquisition date. The intermediary expenses such as audit, legal services, evaluation and consultation and other management expenses incurred for business combination are included in the current profit and loss when incurred. The transaction costs of equity securities or debt securities issued by the Purchaser as merger consideration shall be included in the initial recognition amount of equity securities or debt securities. The contingent consideration involved shall be included in the merger cost according to its fair value on the acquisition date. It is necessary for new or further evidence of the existing situation on the acquisition date to appear within 12 months after the acquisition date
