Cover
Cover | 12 Months Ended |
Dec. 31, 2022 shares | |
Document Information Line Items | |
Entity Registrant Name | DUNXIN FINANCIAL HOLDINGS LIMITED |
Entity Central Index Key | 0001499494 |
Document Type | 20-F |
Amendment Flag | false |
Entity Voluntary Filers | No |
Current Fiscal Year End Date | --12-31 |
Entity Well Known Seasoned Issuer | No |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Entity Current Reporting Status | Yes |
Document Period End Date | Dec. 31, 2022 |
Entity Filer Category | Non-accelerated Filer |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2022 |
Entity Common Stock Shares Outstanding | 1,042,458,184 |
Document Annual Report | true |
Document Transition Report | false |
Entity File Number | 001-34958 |
Entity Incorporation State Country Code | E9 |
Entity Address Address Line 1 | 27th Floor, Lianfa International Building |
Entity Address Address Line 2 | 128 Xudong Road |
Entity Address Address Line 3 | Wuchang District |
Entity Address City Or Town | Wuhan City |
Entity Address Postal Zip Code | 430063 |
Icfr Auditor Attestation Flag | false |
Auditor Name | Audit Alliance LLP |
Auditor Location | Singapore |
Auditor Firm Id | 3487 |
Security 12b Title | Ordinary shares, par value $0.00005 per share |
Trading Symbol | DXF |
Security Exchange Name | NYSE |
Entity Interactive Data Current | Yes |
Document Shell Company Report | false |
Document Registration Statement | false |
Document Accounting Standard | International Financial Reporting Standards |
Business Contact [Member] | |
Document Information Line Items | |
Entity Address Address Line 1 | 27th Floor, Lianfa International Building |
Entity Address Address Line 2 | 128 Xudong Road |
Entity Address Address Line 3 | Wuchang District |
Entity Address City Or Town | Wuhan City |
Entity Address Postal Zip Code | 430063 |
City Area Code | 86 |
Local Phone Number | 27-87303888 |
Contact Personnel Email Address | contact@dunxin.us |
Contact Personnel Name | Mr. Yuan Gao |
CONSOLIDATED STATEMENTS OF PROF
CONSOLIDATED STATEMENTS OF PROFIT AND OTHER COMPREHENSIVE INCOME - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF PROFIT AND OTHER COMPREHENSIVE INCOME | |||
Interest income on loans | ¥ 44,797 | ¥ 20,627 | ¥ 105,570 |
Interest expense | |||
Interest expenses on loans | (21,296) | 21,374 | 21,909 |
Business related taxes and surcharges | (405) | (452) | (304) |
Total interest expense | (21,701) | (21,826) | (22,213) |
Net interest income/(loss) | 23,096 | (1,199) | 83,357 |
Credit impairment losses | (42,420) | 119,078 | (55,264) |
Net interest income/(loss) after credit impairment losses | (19,324) | (120,277) | 28,093 |
Non-interest and other income | 0 | 387 | 21 |
Operating costs and expenses | |||
Sales and marketing | 514 | 293 | 170 |
General and administrative | (10,506) | (7,889) | (8,090) |
Total operating costs and expenses | (11,020) | (8,182) | (8,260) |
Profit/(loss) before income taxes | (30,344) | (128,072) | 19,854 |
Income tax expense | 0 | 0 | 0 |
Net profit/(loss) | (30,344) | (128,072) | 19,854 |
Net profit/(loss) attributable to: | |||
Equity holders of the Company | (24,275) | (102,458) | 15,883 |
Non-controlling interest | (6,069) | (25,614) | 3,971 |
Net profit loss) | (30,344) | (128,072) | 19,854 |
Other comprehensive income/(loss) for the year | |||
Net profit(loss) | (30,344) | 128,072 | 19,854 |
Total currency translation differences arising from consolidation | (325) | (71) | (177) |
Total comprehensive income/(loss) for the year | (30,669) | (128,001) | 19,677 |
Total comprehensive income/(loss) attributable to: | |||
Equity holders of the Company | (24,535) | (102,401) | 15,742 |
Non-controlling interests | (6,134) | 25,600 | (3,935) |
Total comprehensive income/(loss) | ¥ (30,669) | ¥ (128,001) | ¥ (19,677) |
Basic and diluted earnings per share for the profit/(loss) attributable to the equity holders of the Company during the year (expressed in RMB per share) | ¥ (0.02) | ¥ (0.10) | ¥ 0.02 |
Weighted average number of shares outstanding in the year | 1,003,303,952 | 1,002,201,016 | 1,001,575,455 |
CONSOLIDATED STATEMENTS OF FINA
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
CURRENT ASSETS | ||
Cash, cash equivalents and restricted cash | ¥ 295 | ¥ 396 |
Loans receivable, net of credit impairment losses | 556,112 | 555,133 |
Prepaid expenses | 4,629 | 848 |
Total current assets | 561,036 | 556,377 |
NON-CURRENT ASSETS | ||
Property, plant and equipment | 39,228 | 42,180 |
Intangible asset | 5 | 5 |
Total non-current assets | 39,233 | 42,185 |
Total assets | 600,269 | 598,562 |
CURRENT LIABILITIES | ||
Loans payable | 161,439 | 161,569 |
Convertible notes payable | 7,264 | 0 |
Salary and benefit payable | 12,179 | 9,872 |
Income taxes payable | 32,477 | 32,477 |
Interest payable | 72,810 | 54,685 |
Other payable | 25,942 | 21,656 |
Total current liabilities | 312,111 | 280,259 |
Capital and reserve attributable to equity holders of the Company | ||
Share capital | 340 | 326 |
Additional paid-in capital | 383,684 | 383,174 |
Statutory reserve | 18,706 | 18,706 |
General risk reserve | 9,180 | 9,180 |
Currency translation reserve | 231 | 30 |
Accumulated losses | 181,049 | 156,774 |
Non-controlling interests | 57,528 | 63,661 |
Total shareholders' equity | 288,158 | 318,303 |
Total equity and liabilities | ¥ 600,269 | ¥ 598,562 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - CNY (¥) | Total | Total Equity [member] | Noncontrolling Interest | Additional paid-in capital | Share capital | Statutory reserve [member] | general risk reserve [Member] | Currency Translation Reserve Member | Retained Earnings (Accumulated Deficit) |
Balance, amount at Dec. 31, 2019 | ¥ 426,162,000 | ¥ 340,929,000 | ¥ 85,233,000 | ¥ 383,174,000 | ¥ 326,000 | ¥ 18,706 | ¥ 9,180,000 | ¥ (169,000) | ¥ (70,288,000) |
Statement [Line Items] | |||||||||
Share-based compensation | 111,000 | 89,000 | 22,000 | 0 | 0 | 0 | 0 | 0 | 89,000 |
Other comprehensive income for the year - currency translation differences | 177,000 | 142,000 | 35,000 | 0 | 0 | 0 | 0 | 142,000 | 0 |
Net profit for the year | 19,854,000 | 15,883,000 | 3,971,000 | 0 | 0 | 0 | 0 | 0 | 15,833,000 |
Balance, amount at Dec. 31, 2020 | 446,304,000 | 357,043,000 | 89,261,000 | 383,174,000 | 326,000 | 18,706,000 | 9,180,000 | (27,000) | (54,316,000) |
Statement [Line Items] | |||||||||
Other comprehensive income for the year - currency translation differences | 71,000 | 57,000 | 14,000 | 0 | 0 | 0 | 0 | 57,000 | 0 |
Net profit for the year | (128,072,000) | (102,458,000) | (25,614,000) | 0 | 0 | 0 | 0 | 0 | (102,458,000) |
Balance, amount at Dec. 31, 2021 | 318,303,000 | 254,642,000 | 63,661,000 | 383,174,000 | 326,000 | 18,706,000 | 9,180,000 | 30,000 | (156,774,000) |
Statement [Line Items] | |||||||||
Net profit for the year | (30,344,000) | (24,275,000) | (6,069,000) | 0 | 0 | 0 | 0 | 0 | (24,275,000) |
Share issuance | 524,000 | 524,000 | 0 | 510,000 | 14,000 | 0 | 0 | 0 | 0 |
Other comprehensive loss for the year - currency translation differences | (325,000) | (261,000) | (64,000) | 0 | 0 | 0 | 0 | (261,000) | 0 |
Balance, amount at Dec. 31, 2022 | ¥ 288,158,000 | ¥ 230,630,000 | ¥ 57,528,000 | ¥ 383,684,000 | ¥ 340,000 | ¥ 18,706,000 | ¥ 9,180,000 | ¥ (231,000) | ¥ (181,049,000) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flow from operating activities | |||
Profit/(loss) before income tax | ¥ 30,344,000 | ¥ 128,072,000 | ¥ (19,854,000) |
Adjustments for: | |||
Reversal of directors' fee | 0 | 130,000 | 0 |
Depreciation of property, plant and equipment | 2,952,000 | 2,973,000 | 2,977,000 |
Amortization of intangible asset | 0 | 1,000 | 1,000 |
Share-based compensation | 0 | 0 | 111,000 |
Credit impairment losses | 42,420,000 | 119,078,000 | 55,264,000 |
Operating profit/(loss) before changes in working capital | 15,028,000 | (6,150,000) | 78,207,000 |
Loans receivable | (43,400,000) | (12,028,000) | (102,263,000) |
Prepaid expenses | (3,781,000) | (39,000) | (2,250,000) |
Salary and benefit payable | 2,307,000 | 2,212,000 | 2,399,000 |
Interest payable | 18,125,000 | 18,563,000 | 18,399,000 |
Other payable | 4,286,000 | 7,670,000 | 4,882,000 |
Net cash generated by/(used in) operating activities | (7,435,000) | 10,228,000 | (626,000) |
Cash flow from investing activities | |||
Proceeds from disposal of property, plant and equipment | 0 | 0 | 0 |
Purchase for property, plant and equipment | 0 | 0 | 0 |
Net cash used in investing activities | 0 | 0 | 0 |
Cash flow from financing activities | |||
Proceeds received from related party loans | 0 | 0 | 414,000 |
Repayments of related party loans | (130,000) | (10,000,000) | 0 |
Proceeds received from issuance of convertible notes | 6,758,000 | 0 | 0 |
Net cash (used in)/generated by financing activities | 6,628 | (10,000) | 414 |
Net (decrease)/increase in cash, cash equivalents and restricted cash | (807,000) | 228,000 | (212,000) |
Cash and cash equivalents at beginning of year | 396,000 | 97,000 | 132,000 |
Exchange losses on cash, cash equivalents and restricted cash | 706,000 | 71,000 | 177,000 |
Cash, cash equivalents and restricted cash at end of year | 295,000 | 396,000 | 97,000 |
Net cash generated by/(used in) operating activities include | |||
Interest received | 0 | 0 | 100,000 |
Interest paid | 0 | 0 | (200,000) |
Loans receivable novated to a related party to offset its related party loans to the Company | ¥ 0 | ¥ 0 | ¥ 1,305,000 |
Organization and principal acti
Organization and principal activities | 12 Months Ended |
Dec. 31, 2022 | |
Organization and principal activities | |
Organization And Principal Activities | 1. Organization and principal activities Dunxin Financial Holdings Limited (“Dunxin,” together with its subsidiaries and the variable interest entity, collectively the “Company”), formerly known as China Xiniya Fashion Limited, was incorporated in the Cayman Islands as an exempted limited liability company on June 24, 2010. On December 28, 2017, Dunxin completed the Divestiture and Acquisition transactions (the “Transactions”). In connection with the Divestiture transaction, Dunxin divested its wholly-owned subsidiary, Xiniya Holdings Limited, a Hong Kong company, to Qiming Investment Limited, a British Virgin Islands company, in exchange for a purchase consideration of RMB228,000,000 ($34,588,428). After the divestiture transaction, Dunxin did not meet the definition of a business for accounting and financial reporting purposes. In connection with the Acquisition transaction, Dunxin purchased all of the issued and outstanding ordinary shares of True Silver Limited (“True Silver”) for a cash payment of RMB228,000,000 ($34,588,428) and the issuance of 772,283,308 of the ordinary shares at RMB1.00 ($0.15) per share to the shareholders of True Silver. True Silver became the wholly owned subsidiary of Dunxin. True Silver utilizes a variable interest entity structure to operate and consolidate 80% of the financial results of Hubei Chutian Microfinance Co., Ltd (“Chutian”). Chutian, with a registered capital of RMB450 million, is a joint stock company incorporated under the laws of China specializing in providing loan facilities to micro sized enterprises, SMEs, sole proprietors and individuals in Hubei Province, People’s Republic of China. The Transactions were accounted for as a “reverse acquisition” since, immediately following the consummation of the Transactions, the shareholders and management of Chutian having effectuated control of the combined company. The former shareholders of Chutian, whose shares were acquired by Dunxin, own and control 88.7% of shares and votes in Dunxin. The management of Dunxin is drawn predominantly from Chutian. For accounting purposes, the legal subsidiaries of True Silver were deemed to be the accounting acquirer in the transaction and Dunxin, the legal acquirer, was deemed to be the accounting acquiree. The consolidated financial statements represent a continuation of the consolidated financial statements of True Silver and its subsidiaries (the “True Silver Group”) and reflect the following: (a) the assets and liabilities of the True Silver Group were recognized and measured in the consolidated statement of financial position at their carrying amount before the Acquisition; (b) the identifiable assets and liabilities of the Company were recognized and measured in the consolidated financial statements at their acquisition date fair values; (c) the excess of the fair value of purchase consideration over the identifiable net assets of the Company at fair value is recognized as a reduction of additional paid-in capital in the consolidated statement of financial position; (d) the retained earnings and other equity balances recognized in the consolidated financial statement are the retained earnings and other equity balances of the True Silver Group immediately before the Acquisition; (e) the amount recognized as issued equity interest in the consolidated financial statements were determined by adding the issued equity of the True Silver Group outstanding immediately before the Acquisition to the fair value of purchase consideration of the Acquisition. The fair value of purchase consideration is based on the fair value of the Company at the completion date. However, the equity structure appearing in the consolidated financial statement shall reflect the equity structure of the Company, including the equity instruments issued by the Company to effect the Acquisition; (f) the consolidated statement of profit and other comprehensive income for the financial year ended December 31, 2017 reflects that of the True Silver Group for the full period together with the post-acquisition results of the Company; (g) the comparative figures presented in the consolidated financial statements were that of the True Silver Group; and (h) earnings per share for the financial year ended December 31, 2017 reflects the results of the True Silver Group until the date of acquisition and the results of the enlarged Group from the acquisition date. The principal place of business is 27th Floor, Lianfa International Building, 128 Xudong Road, Wuchang District, Wuhan City, Hubei Province, 430063, People’s Republic of China. The Company is listed on the NYSE American LLC, the ticker symbol is DXF. These financial statements are presented in Renminbi, unless otherwise stated. The consolidated financial statements for the three years ended December 31, 2020, 2021 and 2022 were authorized for issue by resolution of the board of directors on May 15, 2023. Reporting entities Dunxin is a holding company. The Company principally engaged in the business of providing loan facilities to micro sized enterprises, SMEs, sole proprietors and individuals in Hubei Province, People’s Republic of China (“PRC”). The Company operates its microfinance lending business through the 80% variable interest entity (“VIE”) operating company, Hubei Chutian Microfinance Co., Ltd (“Chutian”). All of the Company’s operations are conducted in the PRC through Chutian, which holds all the approval certificates, business license and other requisite licenses for the microfinance lending businesses. The following is a brief description of each of the Company’s subsidiaries and variable interest entity: · True Silver - True Silver Limited (“True Silver”) is a limited company incorporated on June 28, 2016, a British Virgin Islands company. The total amount of paid-up share capital of True Silver is $50,000 with 50,000 ordinary shares. True Silver is a holding company and is wholly owned by the Company. · Chutian HK - Chutian Financial Holdings (Hong Kong) Limited (“Chutian HK”) is a limited company incorporated on August 12, 2016, under the Companies Ordinance of Hong Kong. The total amount of paid-up share capital of Chutian HK is HKD10,000 with 100 ordinary shares. Chutian HK is a holding company and is wholly owned by True Silver. · Chutian Holding - Wuhan Chutian Investment Holding Limited (“Chutian Holding”) is a wholly foreign owned enterprise established by Chutian HK on November 4, 2016. · Chutian - Hubei Chutian Microfinance Co., Ltd. is a joint stock company incorporated under laws of PRC on February 20, 2013. Chutian currently holds a business license issued by the Administrative Approval Bureau of Wuchang District, Wuhan Municipality on April 25, 2017, which allows it to operate a microfinance business and provides individual and business loans to persons residing in and businesses operating in Hubei Province, People’s Republic of China. Through a series of contractual agreements (the “VIE Agreements”), Chutian Holding is deemed to control 80% of Chutian and have rights to consolidate 80% of Chutian’s financial results. As of December 31, 2022, the Company’s subsidiaries and variable interest entity were as follows: Subsidiary Place of incorporation Particular of issued and fully paid up capital Company’s effective interest Held by the Company Held by a subsidiary Principal activities True Silver Limited British Virgin Islands $ 50,000 100 % 100 % - Investment holding Chutian Financial Holdings (Hong Kong) Limited Hong Kong HK$ 10,000 100 % - 100 % Investment holding Wuhan Chutian Investment Holding Limited. PRC $ 3,000,000 100 % - 100 % Investment holding Variable interest entity Hubei Chutian Microfinance Co., Ltd PRC RMB 450,000,000 80 % - 80 % Microfinance lender An entity, Hubei Kai Wu Small and Micro Economic Research Institute Co. Ltd, was set up in May 2018 with a registered share capital of RMB5 million, where Chutian should subscribe RMB1.365 million of the registered share capital and held 27.3% of the equity interest of this company. However, all shareholders, including Chutian, did not subscribe to the share capital and this company remain dormant as of December 31, 2022. The VIE arrangements The following is a brief description of the VIE Agreements entered into on August 10, 2017, between Chutian Holding and the shareholders of Chutian, through which the Company controls 80% equity interests of Chutian: · Exclusive Consigned Management Service Agreement · Exclusive Purchase Option Agreement The VIE arrangements - continued · Shareholders’ Voting Proxy Agreement (a) to attend and participate in the shareholders’ meetings of Chutian as the voting proxy of the Shareholders holding 80% Equity Interests of Chutian; (b) to vote on the matters proposed at the shareholders’ meetings, including, but not limited to, voting on the appointment and election of the directors and supervisors of Chutian; (c) to suggest convening the shareholders’ meetings of Chutian; and (d) all other voting rights entitled to the shareholders of Chutian as stipulated in the articles of association of Chutian, as amended from time to time. · Share Pledge Agreement Through the above contractual arrangements, Chutian Holding, has obtained 80% of shareholders' voting interest in the VIE, has the right to receive all dividends declared and paid by the VIE and may receive substantially all of the net income of the VIE through the technical support and service fees as determined by Chutian Holding at its sole discretion. Accordingly, the Company has consolidated the VIE because the Company believes, through the contractual arrangements, (1) Chutian Holding could direct the activities of the VIE that most significantly affect its economic performance and (2) Chutian Holding could receive substantially all of the benefits that could be potentially significant to the VIE. Risks in relation to the VIE structure The Company believes that the VIE arrangements are in compliance with PRC law and are legally enforceable. The shareholders of the VIE are also shareholders of the Company and therefore have no current interest in seeking to act contrary to the contractual arrangements. However, uncertainties in the PRC legal system could limit the Company's ability to enforce these contractual arrangements and if the shareholders of the VIE were to reduce their interest in the Company, their interests may diverge from that of the Company and that may potentially increase the risk that they would seek to act contrary to the contractual terms, for example by influencing the VIE not to pay the service fees when required to do so. The Company's ability to control the VIE also depends on the Voting Proxy Agreement pursuant to which Chutian Holding has the right to vote on all matters requiring shareholder approval in the VIE. As noted above, the Company believes the rights granted by the Voting Proxy Agreement is legally enforceable but may not be as effective as direct equity ownership. In addition, if the legal structure and contractual arrangements were found to be in violation of any existing PRC laws and regulations, the PRC government could: · revoke the business and operating licenses of the Company's PRC subsidiaries and affiliates; · discontinue or restrict the Company's PRC subsidiaries' and affiliates' operations; · impose conditions or requirements with which the Company or its PRC subsidiaries and affiliates may not be able to comply; or · require the Company or its PRC subsidiaries and affiliates to restructure the relevant ownership structure or operations; The imposition of any of these penalties may result in a material and adverse effect on the Company's ability to conduct the Company's business. In addition, if the imposition of any of these penalties causes the Company to lose the rights to direct the activities of the VIE or the right to receive their economic benefits, the Company would no longer be able to consolidate the VIE. The Company does not believe that any penalties imposed or actions taken by the PRC Government would result in the liquidation of the Company, Chutian Holding, or the VIE. Risks in relation to the VIE structure Certain shareholders of the VIE are also beneficial owners or directors of the Company. In addition, certain beneficial owners and directors of the Company are also directors or officers of the VIE. Their interests as beneficial owners of the VIE may differ from the interests of the Company as a whole. The Company cannot be certain that if conflicts of interest arise, these parties will act in the best interests of the Company or that conflicts of interests will be resolved in the Company's favor. Currently, the Company does not have existing arrangements to address potential conflicts of interest these parties may encounter in their capacity as beneficial owners of the VIE, on the one hand, and as beneficial owners of the Company, on the other hand. The Company believes the shareholders of the VIE will not act contrary to any of the contractual arrangements and the exclusive purchase right contract provides the Company with a mechanism to remove them as shareholders of the VIE should they act to the detriment of the Company. If any conflict of interest or dispute between the Company and the shareholders of the VIE arises and the Company is unable to resolve it, the Company would have to rely on legal proceedings in the PRC. Such legal proceedings could result in disruption of its business; moreover, there is substantial uncertainty as to the ultimate outcome of any such legal proceedings. The following financial statements information for the Company’s VIE was included in the accompanying consolidated financial statements, presented net of intercompany eliminations, as of and for the years ended December 31, 2021 and 2022: As of December 31, 202 1 202 2 RMB’000 RMB’000 Total current assets 555,478 556,757 Total non-current assets 42,185 39,233 Total assets 597,663 595,990 Total current liabilities 274,213 297,829 Total liabilities 274,213 297,829 For the year ended December 31, 20 20 202 1 202 2 RMB’000 RMB’000 RMB’000 Interest income on loans 105,570 20,627 44,797 Net profit/(loss) 23,128 (125,370 ) (23,947 ) Risks in relation to the VIE structure The VIE contributed an aggregate of 100.0%, 100.0% and 100.0% of the consolidated interest income on loans for the years ended December 31, 2020, 2021 and 2022, respectively. As of December 31, 2021 and 2022, the VIE accounted for an aggregate of 100.0% and 99.3%, respectively, of the consolidated total assets, and 98.8% and 94.5%, respectively, of the consolidated total liabilities. There are no consolidated VIE's assets that are collateral for the VIE's obligations and can only be used to settle the VIE's obligations. There are no creditors (or beneficial interest holders) of the VIE that have recourse to the general credit of the Company or any of its consolidated subsidiaries. There are no terms in any arrangements, considering both explicit arrangements and implicit variable interests, which require the Company or its subsidiaries to provide financial support to the VIE. However, if the VIE ever need financial support, the Company or its subsidiaries may, at its option and subject to statutory limits and restrictions, provide financial support to its VIE through loans to the shareholders of the VIE or entrustment loans to the VIE. On December 23, 2018, the State Council submitted the draft version of the Foreign Investment Law to the Standing Committee of the National People’s Congress, which was promulgated by the National People’s Congress on its official site on December 26, 2018 for public consultation until February 24, 2019. On March 15, 2019, the National People’s Congress approved the Foreign Investment Law, which On December 23, 2018, the PRC State Council submitted the draft version of the Foreign Investment Law to the Standing Committee of the National People’s Congress, which was promulgated by the National People’s Congress on its official site on December 26, 2018 for public consultation until February 24, 2019. On March 15, 2019, the National People’s Congress approved the Foreign Investment Law, which will come into effect on January 1, 2020 and replace the trio of existing laws regulating foreign investment in China, namely, the Sino-foreign Equity Joint Venture Enterprise Law, the Sino-foreign Cooperative Joint Venture Enterprise Law and the Wholly Foreign-invested Enterprise Law, together with their implementation rules and ancillary regulations. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary Of Significant Accounting Policies | 2. Summary of significant accounting policies This note provides a list of the significant accounting policies adopted in the preparation of these consolidated financial statements. These accounting policies have been consistently applied to all the years presented, unless otherwise stated. The financial statements are for the Company consisting of Dunxin Financial Holdings Limited, its subsidiaries and variable interest entity. 2.1 Basis of preparation (i) Compliance with IFRS The consolidated financial statements of the Company have been prepared in accordance with applicable International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. (ii) Historical cost convention The financial statements have been prepared on a historical cost basis. (iii) Liquidity These consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue its operations in the foreseeable future and that the Company will be able to realize its assets and discharge its liabilities in the normal course of operations. As shown in the accompanying financial statements as of December 31, 2022, the Company had incurred a net loss of RMB30.3 million (US$4.5 million). Besides, the COVID-19 was contained in China 2022, the Company had made specific allowance for the receivables with amount to RMB 42.4 million (US$6.3 million) as of December 31 2022 based on the specific risk of collectability of the receivables. The Company funded these losses through: (1) the continued financial support from its related party or its ability to obtain external financing; or (2) further implementing management’s business plan to enter into new business and generate sufficient revenues to meet its obligations. As of December 31, 2022, the Company’s having a minimum cash balance on the consolidated statement of financial statement. The Company has taken an intensive review of operations and expenditures, including selling, distribution, and administration expenses, to identify and eliminate inefficiencies and redundancies in order to preserve cash while maintaining the business. Given the Company’s existing cash balances and projected cash generated by, and used in, operating activities, the Company believes that it will have sufficient liquidity to fund its operating activities, and react as necessary to market changes, which may include working capital needs for at least twelve months from December 31, 2022. These consolidated financial statements do not reflect adjustments to the carrying value of assets and liabilities, reported expenses and statement of financial position classification that would be necessary if going concern assumption was not appropriate. These adjustments could be material. The Company has historically met its cash needs through a combination of cash flows from operating activities, loans payable from third parties raised through various securities exchanges, loans from shareholders and loans from related parties. The cash requirements of the Company are generally for operating activities and repayments of loans from third parties, related parties and shareholders. Ever since securities exchanges have ceased offering any form of financing to the Company through their platforms as well as loans receivable were credit-impaired, the Company ran into severe liquidity issue. In the beginning of 2019, the Company began to default in certain loans payable, even though certain loans payable were negotiated for revised repayment terms. With loans receivables continued to be further credit-impaired, all obligations of loans payable were defaulted. The liquidity issue of the Company has further severely affected its ability to pay its taxes, service providers, employees and others. Due to non-payment of its obligations when due, multiple significant legal proceedings were initiated by its shareholders, service providers and others against the Company (see Note 28 - Legal proceedings for detailed disclosure). The Company has taken an intensive review of operations and expenditures, including intensifying loan and interest collection initiative and monetizing collaterals of loans receivable. The Company has also acquired the financial support letter from Hubei New Nature Investment Co., Ltd, a company that is 80.8% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, and from Dunxin Holdings Co., Ltd, a company that is 70% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, which have expressed the willingness and intention to provide the necessary financial support to the Company. Further, the Company plans to actively seek equity financing from private placements, so as to enable the Company to meet its liabilities as and when it falls due and to carry on its business without a significant curtailment of operations for the next 12 months from the issuance date of this report. 2.1 Basis of preparation - continued (iii) Liquidity - continued The Company believes that available cash and cash equivalents, future cash provided by operating activities, together with the efforts from aforementioned management plan and actions, should enable the Company to meet presently anticipated cash needs for at least the next 12 months after the date that the financial statements are issued and the Company has prepared the consolidated financial statements on a going concern basis. However, the Company continues to have ongoing obligations and it expects that it will require additional capital in order to execute its longer-term business plan. If the Company encounters unforeseen circumstances that place constraints on its capital resources, management will be required to take various measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing the Company’s business development activities, suspending the pursuit of its business plan, controlling operating expenses and seeking to further dispose of non-core assets. Management cannot provide any assurance that the Company will raise additional capital if needed. 2.2 Basis of consolidation (i) Subsidiaries Subsidiaries are entities (including variable interest entity) over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases. The acquisition method of accounting is used to account for business combinations by the Company. Intercompany transactions, balances and unrealized gains on transactions between group companies are eliminated in preparing the consolidated financial statements. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Company. (ii) Non-controlling interests Non-controlling interests in the results and equity of subsidiaries are shown separately in the Consolidated Statements of Profit and Other Comprehensive Income, the Consolidated Statements of Financial Position and Consolidated Statements of Changes in Shareholders’ Equity respectively. 2.3 Business combinations The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the: · fair values of the assets transferred; · liabilities incurred to the former owners of the acquired business; · equity interests issued by the Company; · fair value of any asset or liability resulting from a contingent consideration arrangement; and · fair value of any pre-existing equity interest in the subsidiary. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are with limited exceptions, measured initially at their fair values at the acquisition date. The Company recognizes any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets. Acquisition-related costs are expensed as incurred. The excess of the · consideration transferred, · amount of any non-controlling interest in the acquired entity, and · acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain purchase. 2.4 Segments Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segment, has been identified as the steering committee that makes strategic decisions. The Company operates in only one segment. 2.5 Foreign currency translation (j)Functional and presentation currency Items included in the financial statements of each of the Company’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The consolidated financial statements are presented in Chinese Renminbi (RMB), which is the Company’s presentation currency. (ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognized in the statement of profit and other comprehensive income. Foreign exchange gains and losses are presented in the Consolidated Statements of Profit and Other Comprehensive Income on a net basis within other income or other expenses. (iii) Group companies The results and financial position of all the Group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows: (a) assets and liabilities for each consolidated statement of financial position presented are translated at the closing rate at the date of that consolidated statement of financial position; (b) income and expenses for each consolidated statement of profit and other comprehensive income are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and (c) all resulting exchange differences are recognized in other comprehensive income. 2.6 Interest Interest (IFRS 9 - 2020, 2021 and 2022) Interest income and expense for all financial instruments are recognized in “Net interest income” as “Interest income” and “Interest expense” in the Consolidated Statement of Profit and Other Comprehensive Income using the effective interest method. Interest income for financial assets held at amortized cost is recognized in profit or loss using the effective interest method. The effective interest rate is the rate that exactly discount estimated future cash payments or receipts through the expected life of the financial asset or financial liability (or, where appropriate, a shorter period) to the gross carrying amount of a financial asset (i.e. its amortized cost before any impairment allowance) or to the amortized cost of a financial liability. When calculating the effective interest rate, the Company estimates cash flows considering all contractual terms of the financial instrument but does not consider expected credit losses and includes transaction costs, premiums or discounts and fees and points paid or received that are integral to the effective interest rate, such as origination fees. When the Company revises the estimates of future cash flows, the carrying amount of the respective financial assets or financial liability is adjusted to reflect the new estimate discounted using the original effective interest rate. Any changes are recognized in profit or loss. The interest income / interest expense is calculated by applying the effective interest rate to the gross carrying amount of non-credit impaired financial assets (i.e. at the amortized cost of the financial asset before adjusting for any expected credit loss allowance), or at amortized cost of financial liabilities. Interest income for financial assets that are amortized cost that have become credit-impaired subsequent to initial recognition is recognized using the credit adjusted effective interest rate. This rate is calculated in the same manner as the effective interest rate except that expected credit losses are included in the expected cash flows. Interest income is therefore recognized on the amortized cost of the financial asset including expected credit losses. Should the credit risk on a credit-impaired financial asset improve such that the financial asset is no longer considered credit-impaired, interest income recognition reverts to a computation based on the rehabilitated gross carrying value of the financial asset. A contract modification is a change in the scope or interest rate (or both) of a contract that is approved by the parties to the contract. A contract modification exists when the parties to a contract approve a modification that either creates new or changes existing enforceable rights and obligations of the parties to the contract. When a contract modification is not accounted for as a separate contract, the Company shall account for the contract modification as if it were a part of the existing contract as the remaining services are not distinct and therefore, form part of single performance obligation that is partially satisfied at the date of the contract modification. The effect that the contract modification has on the interest rate, and on the entity’s measure of progress towards complete satisfaction of the performance obligation, is recognized as an adjustment to interest income (either as an increase in or a reduction of interest income) at the date of the contract modification (i.e., the adjustment to interest income is made on a cumulative catch-up basis). 2.7 Income tax Income tax expense comprises current and deferred tax. It is recognized in the Consolidated Statements of Profit and Other Comprehensive Income. i. Current tax Current tax comprises the expected tax payable or receivable on taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payable or receivable is the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantially enacted at the reporting date. ii. Deferred tax Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets or liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets are recognized for deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Future taxable profits are determined based on business plans for individual subsidiaries and variable interest entity in the Company and the reversal of temporary differences. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Unrecognized deferred tax assets are reassessed at each reporting date and recognized to the extent that it has become probable that future taxable profits will be available against which they can be used. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantially enacted at the reporting date. The measurement of deferred tax reflects the tax consequences that would follow the manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. iii. Tax exposures In determining the amount of current and deferred tax, the Company considers the impact of tax exposures, including whether additional taxes and interest may be due. This assessment relies on estimates and assumptions and may involve a series of judgments about future events. New information may become available that causes the Company to change its judgments regarding the adequacy of existing tax liabilities; such changes to tax liabilities would impact tax expense in the period in which such a determination is made. 2.8 Financial assets and financial liabilities (IFRS 9 - 20 20 , 202 1 and 202 2 only) i Initial recognition and measurement Financial assets and financial liabilities are recognized when the entity becomes a party to the contractual provisions of the instrument. At initial recognition, the Company measures a financial asset or financial liability at its fair value plus or minus transaction costs that are incremental and directly attributable to the acquisition or issue of the financial asset or financial liability, such as fees and commissions. Immediately after initial recognition, an expected credit loss allowance is recognized for financial assets measured at amortized cost, which results in an accounting loss being recognized in profit or loss when an asset is newly originated. ii Classification and subsequent measurement Management determines the classification of its financial assets and liabilities at initial recognition of the instrument or, where applicable, at the time of reclassification. Financial assets From January 1, 2018, the Company has applied IFRS 9 and classifies its financial assets into amortized cost measurement category. The Company’s financial assets that are held to collect the contractual cash flows and which contain contractual terms that give rise on specified dates to cash flows that are solely payments of principal and interest (“SPPI”) are measured at amortized cost. Financial liabilities The Company classifies its financial liabilities as measured at amortized cost. iii Derecognition Financial assets The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. In transactions in which the Company neither retains or transfers substantially all of the risks and rewards of ownership of a financial asset and its retains control over the asset, the Company continues to recognize the asset to the extent of its continuing involvement, determined by the extent to which it is exposed to changes in the value of the transferred asset. Financial liabilities The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. iv Amortized cost measurement The “amortized cost” of a financial asset or financial liability is the amount at which the financial asset or financial liability is measured at initial recognition, minus principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount and, for financial assets, adjusted for any loss allowance. v. Identification and measurement of impairment IFRS 9 outlines a “three-stage” model for impairment based on changes in credit quality since initial recognition as summarized below: · A financial instrument that is not credit-impaired on initial recognition is classified in “Stage 1” and has its credit risk continuously monitored by the Company. · If a significant increase in credit risk since initial recognition is identified, the financial instrument is moved to “Stage 2” but is not yet deemed to be credit-impaired. · If the financial instrument is credit-impaired, the financial instrument is then moved to “Stage 3”. · Financial instruments in Stage 1 have their expected credit loss measured at an amount equal to the portion of lifetime expected credit losses that result from default events possible within the next 12 months. Financial instruments in Stages 2 or 3 have their expected credit loss measured based on expected credit losses on a lifetime basis. · A pervasive concept in measuring expected credit loss in accordance with IFRS 9 is that it should consider forward looking information. Significant increase in credit risk The Company monitors its financial assets that are subject to the impairment requirements to assess whether there has been a significant increase in credit risk since initial recognition. If there has been a significant increase in credit risk the Company will measure the loss allowance based on lifetime rather than 12-month expected credit loss. The Company’s accounting policy is not to use the practical expedient that financial assets with “low” credit risk at the reporting date are deemed not to have had a significant increase in credit risk. As a result, the Company monitors all financial assets that are subject to impairment for significant increase in credit risk. In assessing whether the credit risk on a financial instrument has increased significantly since initial recognition, the Company compares the risk of a default occurring on the financial instrument at the reporting date based on the remaining maturity of the instrument with the risk of a default occurring that was anticipated for the remaining maturity at the current reporting date when the financial instrument was first recognized. In making this assessment, the Company considers both quantitative and qualitative information that is reasonable and supportable, including historical experience and forward-looking information that is available without undue cost or effort, based on the Company’s historical experience and expert credit assessment including forward-looking information. The quantitative information is a primary indicator of significant increase in credit risk and is based on the change in lifetime probability of default by comparing: · the remaining lifetime probability of default at the reporting date; with · the remaining lifetime probability of default for this point in time that was estimated based on facts and circumstances at the time of initial recognition of the exposure. The probability of defaults used are forward looking and the Company uses the same methodologies and data used to measure the loss allowance for expected credit loss. The qualitative factors that indicate significant increase in credit risk are reflected in probability of default models on a timely basis. Given that a significant increase in credit risk since initial recognition is a relative measure, a given change, in absolute terms, in the probability of default will be more significant for a financial instrument with a lower initial probability of default than compared to a financial instrument with a higher probability of default. As a back-stop when an asset becomes 30 days past due, the Company considers that a significant increase in credit risk has occurred and the asset is in stage 2 of the impairment model, i.e. the loss allowance is measured as the lifetime expected credit loss. Credit-impaired financial assets A financial asset is “credit-impaired” when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Credit-impaired financial assets are referred to as Stage 3 assets. Evidence of credit-impairment includes observable data about the following events: · Significant financial difficulty of the borrower; · a breach of contract such as a default or past due event; or · the lender of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, having granted to the borrower a concession that the lender would not otherwise consider. It may not be possible to identify a single discrete event - instead, the combined effect of several events may have caused financial assets to become credit-impaired. A loan is considered credit-impaired when a concession is granted to the borrower due to a deterioration in the borrower’s financial condition, unless there is evidence that as a result of granting the concession the risk of not receiving the contractual cash flows has reduced significantly and there are no other indicators of impairment. For financial assets where concessions are contemplated but not granted the asset is deemed credit impaired when there is observable evidence of credit-impairment including meeting the definition of default. The definition of default (see below) include unlikeliness to pay indicators. Definition of default Critical to the determination of expected credit loss is the definition of default. The definition of default is used in measuring the amount of expected credit loss and in the determination of whether the loss allowance is based on 12-month or lifetime expected credit loss, as default is a component of the probability of default which affects both the measurement of expected credit losses and the identification of a significant increase in credit risk. The Company considers the following as constituting an event of default: · the borrower is past due more than nine months on any material credit obligation to the Company; or · the borrower is unlikely to pay its credit obligations to the Company in full. When assessing if the borrower is unlikely to pay its credit obligation, the Company takes into account both qualitative and quantitative indicators. Quantitative indicators, such as overdue status and non-payment on another obligation of the same counterparty are key inputs in this analysis. The Company uses a variety of sources of information to assess default which are either developed internally or obtained from external sources. Objective evidence of impairment At each reporting date, the Company assesses whether there is objective evidence that financial assets are impaired. A financial asset or a group of financial assets is impaired when objective evidence demonstrates that a loss event has occurred after the initial recognition of the assets and that the loss event has an impact on the future cash flows of the assets and that the loss event has an impact on the future cash flows of the assets that can be estimated reliably. Objective evidence that financial assets are impaired includes: · significant financial difficulty of the borrower; · default or delinquency by a borrower; · the restructuring of a loan by the Company on terms that the Company would not consider otherwise; · indications that a borrower will enter bankruptcy; or · observable data relating to a group of assets such as adverse changes in the payment status of borrowers in the Company, or economic conditions that correlate with defaults in the Company. The Company recognizes loss allowance for expected credit loss on loan receivables. Expected credit losses are required to be measured through a loss allowance at an amount equal to: · 12-month expected credit loss, i.e. lifetime expected credit loss that result from those default events on the financial instrument that are possible within 12 months after the reporting date, (referred to as Stage 1); or · Full lifetime expected credit loss, i.e. lifetime expected credit loss that result from all possible default events over the life of the financial instrument, (referred to as Stage 2 and Stage 3). A loss allowance for full lifetime expected credit loss is required for a financial instrument if the credit risk on that financial instrument has increased significantly since initial recognition. For all other financial instruments, expected credit losses are measured at an amount equal to the 12-month expected credit loss. Expected credit losses are computed as unbiased, a probability-weighted estimate of the present value of credit losses. These are measured as the present value of the difference between the cash flows due to the Company under the contract and the cash flows that the Company expects to receive by evaluating a range of reasonably possible outcomes, the time value of money, and considering all reasonable and supportable information including that which is forward-looking, discounted at the asset’s effective interest rate. For Stage 1 and 2 loans, the estimate of expected cash shortfalls over the life time of the loans is determined by multiplying the probability of default (“PD”) with the loss given default (“LGD”). For credit-impaired financial instruments (Stage 3 loans), the estimate of cash shortfalls may require the use of expert credit judgment. Cash shortfalls are discounted using the effective interest rate on the financial instrument as calculated at initial recognition. The Company’s initial contractual loan terms are within 12 months. For simplification purpose, for Stage 1 and Stage 2 loans, the Company recognized the expected credit losses for the lifetime of the loans. Stage 1: Expected credit losses are recognized at the time of initial recognition of a financial instrument and represent the lifetime cash shortfalls arising from possible default events for the life of loan from the balance sheet date. Expected credit losses continue to be determined on this basis until there is either a significant increase in the credit risk of an instrument or the instrument becomes credit-impaired. Stage 2: If a financial asset experiences a significant increase in credit risk since initial recognition, an expected credit loss provision is recognized for default events that may occur over the lifetime of the asset. Significant increase in credit risk is assessed by comparing the risk of default of an exposure at the reporting date to the risk of default at origination (after taking into account the passage of time). Significant does not mean statistically significant nor is it assessed in the context of changes in expected credit loss. Whether a change in the risk of default is significant or not is assessed using a number of quantitative and qualitative factors, the weight of which depends on the type of product and counterparty. Financial assets that are 30 or more days past due and not credit-impaired will always be considered to have experienced a significant increase in credit risk. Stage 3: Financial assets that are credit-impaired (or in default) represent those that are past due more than the historical average collection period for past due loans, but not to exceed the original contractual loan terms. Financial assets are also considered to be credit-impaired where the obligors are unlikely to pay on the occurrence of one or more observable events that have a detrimental impact on the estimated future cash flows of the financial asset. It may not be possible to identify a single discrete event but instead the combined effect of several events may cause financial assets to become credit-impaired. Loss provisions against credit-impaired financial assets are determined based on an assessment of the recoverable cash flows under a range of scenarios, including the realization of any collateral held where appropriate. The loss provisions held represent the difference between the present value of the cash flows expected to be recovered, discounted at the instrument’s original effective interest rate, and the gross carrying value of the instrument prior to any credit impairment. 2.9 Cash, cash equivalents and restricted cash For the purpose of the consolidated cash flow statements, cas |
Standards issued but not yet ef
Standards issued but not yet effective | 12 Months Ended |
Dec. 31, 2022 | |
Standards issued but not yet effective | |
Standards Issued But Not Yet Effective | 3. Standards issued but not yet effective Up to the date of issue of these financial statements, the following standards and interpretations had been issued which are not mandatory for the year ended December 31, 2022 and which have not been adopted in these financial statements. These include the following which may be relevant to the Company. Effective for accounting periods beginning on or after Amendments to IAS 1, Classification of Liabilities as Current or Non-Current January 1, 2023 Amendments to IA S 8 , Definition of Accounting Estimates January 1, 2023 IFRS 17 Insurance Contracts January 1, 2023 Amendments to IAS 1, Presentation of Financial Statements, and IFRS Practice Statement 2, Making Materiality Judgements January 1, 2023 Amendments to IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors January 1, 2023 Amendments to IAS 12, Income Taxes January 1, 2024 Amendments to IAS 16, Leases January 1, 2024 Amendments to IAS 1, Presentation of Financial Statements Management anticipates that all of the relevant pronouncements will be adopted by the Company for the first period following the effective date of the pronouncement. Information on new standards and amendments, that are expected to be relevant, is provided below. Amendments to IAS 1 and IAS 8: Definition of Material The amendments provide a consistent definition of materiality throughout International Financial Reporting Standards and the Conceptual Framework for Financial Reporting, clarify when information is material and incorporate some of the guidance in IAS 1 about immaterial information. In particular, the amendments clarify: (i) that the reference to obscuring information addresses situations in which the effect is similar to omitting or misstating that information, and that an entity assesses materiality in the context of the financial statements as a whole, and (ii) the meaning of ‘primary users of general purpose financial statements’ to whom those financial statements are directed, by defining them as ‘existing and potential investors, lenders and other creditors’ that must rely on general purpose financial statements for much of the financial information they need. The Company's current practices are in line with these criteria, so the application of these amendments did not have an impact on the Company's financial position or results in the period, nor are they expected to do so in the future. Conceptual Framework for Financial Reporting The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or requirements in any standard. The purpose of the Conceptual Framework is to assist the IASB in developing standards, to help preparers develop consistent accounting policies where there is no applicable standard in place and to assist all parties to understand and interpret the standards. The revised Conceptual Framework includes some new concepts, provides updated definitions and recognition criteria for assets and liabilities and clarifies some important concepts, such as removing the probability threshold for recognition and adding guidance on derecognition, or adding guidance on different measurement basis. No changes were made to any of the current accounting standards. The Company’s accounting policies are still appropriate under the revised Framework, so these amendments had no impact on the Company's financial position or results in the period. |
Critical accounting estimates a
Critical accounting estimates and use of judgments | 12 Months Ended |
Dec. 31, 2022 | |
Critical Accounting Estimates And Use Of Judgments | 4. Critical accounting estimates and use of judgments In preparing these consolidated financial statements, management are required to make judgments, estimates and assumptions that affect the application of the Company’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates, assumptions and judgments are continually evaluated and are based on historical experience and other factors that are considered to be relevant, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are recognized prospectively. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. i. Measurement of the expected credit loss allowance The measurement of the expected credit loss allowance for financial assets measured at amortized cost is an area that requires the use of significant assumptions about future economic conditions and credit behavior (e.g. the likelihood of customers defaulting and the resulting losses). A number of significant judgments are also required in applying the accounting requirements for measuring expected credit loss, such as: · Determining criteria for significant increase in credit risk; · Choosing appropriate models and assumptions for the measurement of expected credit loss. Further details of identification and measurement of expected credit loss impairment were discussed in Note 2.8 of Notes to the Consolidated Financial Statements. ii. Income tax The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of event that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates, applicable to the periods in which the differences are expected to affect taxable income. International Accounting Standard 12 Income Taxes (“IAS12”) requires a one-step approach that provides a company to satisfy the probability criterion when assessing whether a deferred tax account should be recorded or not. Under this criterion, the Company record a deferred tax account only to the extent it can show it is probable that taxable profit will be available against which the deferred tax asset can be utilized. Current IAS 12 does not have specific guidance on uncertain tax positions. The Company measures tax assets and liabilities at the amount expected to be paid, based on enacted or substantively enacted tax legislation. Interest and penalties related to uncertain tax position are recognized and recorded as necessary in the provision for income taxes. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to computation errors made by the taxpayer or the withholding agent. The statute of limitations is extended to five years under special circumstances, where the underpayment of taxes is more than RMB 100,000. In the case of transfer pricing issues, the statute of limitation is ten years. There is no statute of limitation in the case of tax evasion. The PRC tax returns for the Company's PRC subsidiary is open to examination by tax authorities for the tax years beginning in 2018. There were no uncertain tax positions as of December 31, 2021 and 2022 and the Company does not believe that its unrecognized tax benefits will change over the next twelve months. iii. Impairment of property, plant and equipment The Company reviews its property, plant and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. When these events occur, the Company assesses the recoverability of the property, plant and equipment by comparing the carrying value of the property, plant and equipment to the estimated undiscounted future cash flows expected to result from the use of the assets and their eventual disposition where the fair value is lower than the carrying value, measurement of an impairment loss is recognized in the consolidated statements of profit and other comprehensive income for the difference between the fair value, using the expected future discounted cash flows, and the carrying value of the assets. No impairment of property, plant and equipment was recognized for the periods presented. iv. Fair value of convertible notes payable The fair value of convertible promissory notes are determined using valuation techniques including reference to other instruments that are substantially the same, discounted cash flow analysis and option pricing model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. |
Credit risk
Credit risk | 12 Months Ended |
Dec. 31, 2022 | |
Credit Risk | 5. Credit risk Credit risk is the risk that a customer or counterparty fail to fulfill its contractual obligations resulting in financial loss to the Company. The Company’s main income generating activity is lending to customers and therefore credit risk is a principal risk. Credit risk mainly arises from loans to customers. The Company considers all elements of credit risk exposure such as counterparty default risk for risk management purposes. Credit risk management The Company’s credit committee is responsible for managing the Company’s credit risk by: · Ensuring that the Company has appropriate credit risk practices, including an effective system of internal control, to consistently determine adequate allowances in accordance with the Company’s stated policies and procedures, IFRS and relevant supervisory guidance. · Identifying, assessing and measuring credit risk across the Company, from an individual loan to a portfolio level. · Creating credit policies to protect the Company against the identified risks including the requirements to obtain collateral from borrowers, to perform robust ongoing credit assessment of borrowers and to continually monitor exposures against internal risk limits. · Establishing a robust control framework regarding the authorization structure for the approval and renewal of credit facilities. · Developing and maintaining the Company’s processes for measuring expected credit loss including monitoring of credit risk, incorporation of forward-looking information and the method used to measure expected credit loss. · Ensuring that the Company has policies and procedures in place to appropriately maintain and validate methods used to assess and measure expected credit loss. · Establishing a sound credit risk accounting assessment and measurement process that provides it with a strong basis for common systems, tools and data to assess credit risk and to account for expected credit loss. Providing advice, guidance and specialist skills to business units to promote best practice throughout the Company in the management of credit risk. Maximum exposure to credit risk - financial instruments subject to impairment The following table contains an analysis of the credit risk exposure of financial instruments for which an expected credit loss allowance is recognized. The gross carrying amount of financial assets below also represents the Company’s maximum exposure to credit risk on these assets. 202 2 ECL staging Stage 1 Stage 2 Stage 3 Lifetime ECL Lifetime ECL Lifetime ECL Total RMB’000 RMB’000 RMB’000 RMB’000 Loans receivable - - 753,043 753,043 Accrued interest - - 443,359 443,359 Gross loans receivable - - 1,196,402 1,196,402 Credit impairment losses - - (640,290 ) (640,290 ) Carrying amount - - 556,112 556,112 202 1 ECL staging Stage 1 Stage 2 Stage 3 Lifetime ECL Lifetime ECL Lifetime ECL Total RMB’000 RMB’000 RMB’000 RMB’000 Loans receivable - - 754,393 754,393 Accrued interest - - 398,610 398,610 Gross loans receivable - - 1,153,003 1,153,003 Credit impairment losses - - (597,870 ) (597,870 ) Carrying amount - - 555,133 555,133 |
Liquidity risk
Liquidity risk | 12 Months Ended |
Dec. 31, 2022 | |
Liquidity Risk | 6. Liquidity risk Liquidity risk is the risk that the Company does not have sufficient financial resources to meet its obligations as they fall due, or will have to do so at an excessive cost. This risk arises from mismatches in the timing of cash flows which is inherent in lending operations and can be affected by a range of Company-specific and market-wide events. Liquidity risk management According to relevant laws and regulations, the funds obtained by a microfinance company from banking financial institutions may not exceed 50% of its net capital. As of December 31, 2022, the Company did not have funds obtained from banking financial institutions. As all loans receivable of the Company are credit impaired, the Company is facing significant liquidity issue. Obligations to loans payable, State Taxation Administration, employees and service providers are all over due. |
Market risk
Market risk | 12 Months Ended |
Dec. 31, 2022 | |
Market Risk | 7. Market risk The main non-trading risk types are interest rates and credit spreads. Interest rate risk may result in of loss from fluctuations in the future cash flows. Interest rate risk is managed principally through monitoring interest rate gaps and basis risk. Credit spreads reflect the credit risk of the loans to customers, i.e. risk that a customer or counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company's credit risk exposure and the related management process are described in note 5. The following table sets out the carrying amount of assets and liabilities subject to market risk: As of December 31, 202 1 202 2 RMB’000 RMB’000 Assets subject to market risk Loans receivable 555,133 556,112 Liabilities subject to market risk Loan payable 161,569 161,439 Convertible notes payable - 7,264 There has been no change to the manner in which the Company manages and measures it’s market exposure in the current year. |
Capital risk
Capital risk | 12 Months Ended |
Dec. 31, 2022 | |
Capital Risk | 8. Capital risk As of December 31, 2022, there was no administrative regulatory authority for the microfinance industry at the national level. According to the Guiding Opinions on the Pilot Operation of Microfinance Companies, jointly issued by the CBRC and the PBOC on May 4, 2008, any provincial government that is able to assign a department, financial office or other similar authority to take charge of the supervision and administration of microfinance companies and is willing to assume the responsibility of risk management of microfinance companies may formulate pilot rules and measures in relation to the incorporation of such companies within the province, autonomous region or municipalities directly under the PRC government. Therefore, the microfinance industry in the PRC is primarily regulated by the financial offices and other similar authorities of the provincial governments of the relevant provinces. In Hubei Province, the Microfinance Work Joint Session and its office are the regulatory authorities for microfinance companies in Hubei Province. Pursuant to the Measures for Administration of Pilot Scheme on Microfinance Companies in Hubei Province On February 6, 2013, the Company’s variable interest entity, Hubei Chutian Microfinance Co., Ltd (“VIE”), was issued an Official Reply (E Jin Ban Fa No. [2013]14) by the Financial Office of People’s Government of Hubei, which approved VIE under the pilot program as a microfinance company, as proposed by the Wuchang People’s Government. According to the relevant laws and regulations applicable in the Hubei Province, the capital requirement for the microfinance industry is that the registered capital shall not be less than RMB50 million. As of December 31, 2022, the registered capital of the VIE was RMB450 million. There is no other capital requirement from the regulatory authority. |
Fair value of financial assets
Fair value of financial assets and liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Fair value of financial assets and liabilities | |
Fair Value Of Financial Assets And Liabilities | 9. Fair value of financial assets and liabilities The Company’s financial instruments consist of non-derivative financial assets and liabilities. The fair value of these non-derivative financial instruments is determined using internally generated valuation models, which are usually developed from generally accepted valuation models. The majority of the significant inputs into these models may not be observable in the market, and may be derived from interest rates based on assumptions. The selection of the appropriate valuation model, as well as the determination of key inputs used such as the expected future cash flows on the financial instrument, the probability of counterparty default and the appropriate discount rate to be used, require management judgment and estimation. As of December 31, 202 2 Fair value Carrying Amount RMB’000 RMB’000 Financial assets Cash, cash equivalents and restricted cash 295 295 Loans receivable 556,112 556,112 556,407 556,407 Financial liabilities Loans payable 161,439 161,439 Convertible notes payable 7,264 7,264 168,703 168,703 The fair values of loans payable are approximately the carrying amount of loans payable as all loans payable are overdue as of December 31, 2022. As of December 31, 202 1 Fair value Carrying amount RMB’000 RMB’000 Financial assets Cash, cash equivalents and restricted cash 396 396 Loans receivable 555,133 555,133 555,529 555,529 Financial liabilities Loans payable 161,569 161,569 |
Profit(loss) before income taxe
Profit(loss) before income taxes | 12 Months Ended |
Dec. 31, 2022 | |
Profit/(loss) Before Income Taxes | 10. Profit/(loss) before income taxes Expenses by nature Year Ended December 31, 20 20 202 1 202 2 RMB’000 RMB’000 RMB’000 Depreciation of property, plant and equipment 2,977 2,973 2,952 Amortization of intangible asset 1 1 *- Directors - salaries and related costs 1,051 602 816 - social benefits contribution 5 11 24 - share based compensation 37 - - Key management personnel (other than directors) - salaries and related costs 1,563 1,380 1,212 - social benefits contribution 5 11 - - share based compensation 74 - - Other than directors and key management personnel - salaries and related costs 707 578 689 - social benefits contribution 10 44 36 *Less than RMB1,000 |
Income tax expense
Income tax expense | 12 Months Ended |
Dec. 31, 2022 | |
Income tax expense | |
Income Tax Expense | 11. Income tax expense The Company is a tax exempted company incorporated in the Cayman Islands. In addition, dividend payments by the Company are not subject to withholding taxes. No provision for Hong Kong Profits Tax has been made as the subsidiary incorporated in Hong Kong had no assessable profits earned or derived from Hong Kong during the years ended December 31, 2020, 2021 and 2022. Payments of dividends by Hong Kong companies are not subject to Hong Kong withholding tax. The subsidiaries incorporated in the PRC other than Hong Kong are governed by the Income Tax Law of the PRC concerning Foreign Investment and Foreign Enterprises and various local income tax laws. Dividends paid by our PRC operating subsidiaries may be subject to withholding taxes of 5%-10%. The Company does not have any deferred tax assets or liabilities as of December 31, 2020, 2021 and 2022. The reconciliation between tax expense and accounting profit at applicable PRC tax rates of 25% is as follows: Year Ended December 31, 20 20 202 1 202 2 RMB’000 RMB’000 RMB’000 Profit/(loss) before income taxes 19,854 (128,072 ) (30,344 ) Computed expected income tax expense 4,963 (32,018 ) (7,586 ) Tax effect of non-deductible expenses 13,817 33,058 7,573 Tax effect of tax-exempt entities 804 604 (1,503 ) Tax effect of non-taxable income (19,584 ) (1,644 ) 1,516 Income tax expense - - - |
Earnings(loss) per share
Earnings(loss) per share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings(loss) per share | |
Earnings Per Share | 12. Earnings/(loss) per share Basic and diluted earnings per share are calculated by dividing the profit/(loss) attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding during the year. The weighted average ordinary shares outstanding were 1,001,575,455, 1,002,201,016 and 1,003,303,952 for 2020, 2021 and 2022, respectively. Prior to December 17, 2014, each American Depository Share (“ADS”) represented the right to receive four (4) ordinary shares, par value $0.00005 per share (the “Shares”), from December 18, 2014, the right to receive sixteen (16) Shares and from December 28, 2017, the right to receive forty-eight (48) Shares. Computation of basic and diluted earnings/(loss) per share: 20 20 RMB’000 202 1 RMB’000 202 2 RMB’000 Net profit/(loss) attributable to the equity holders of the Company - numerator for basic and diluted earnings/(loss) per share 15,883 (102,458 ) (24,275 ) Number of shares in thousands Weighted average share outstanding - denominator for basic and diluted earnings/(loss) per share 1,001,575 1,002,201 1,003,304 Basic and diluted earnings/(loss) per share 0.02 (0.10 ) (0.02 ) |
Cash cash equivalents and restr
Cash cash equivalents and restricted cash | 12 Months Ended |
Dec. 31, 2022 | |
Cash, Cash Equivalents And Restricted Cash | 13. Cash, cash equivalents and restricted cash As of December 31, 202 1 202 2 RMB’000 RMB’000 Cash on hand 40 41 Cash at bank 310 87 Restricted cash at bank (1) 46 167 Cash, cash equivalents and restricted cash per consolidated statements of cash flow 396 295 _______________ (1) |
Loans receivable net of credit
Loans receivable net of credit impairment losses | 12 Months Ended |
Dec. 31, 2022 | |
Loans Receivable, Net Of Credit Impairment Losses | 14. Loans receivable, net of credit impairment losses The total loans receivable are comprised of the following: As of December 31, 202 1 202 2 RMB’000 RMB’000 Loans receivable at amortized cost 754,393 753,043 Accrued interest 398,610 443,359 Gross loans receivable 1,153,003 1,196,402 Less: Credit impairment losses (597,870 ) (640,290 ) Loans receivable, net of credit impairment losses 555,133 556,112 The following table provides the changes in credit impairment losses between the beginning and the end of the annual period: As of December 31, 202 1 202 2 RMB’000 RMB’000 Credit impairment losses as at January 1 478,792 597,870 Charge to statement of profit and other comprehensive income 119,078 42,420 Credit impairment losses as of December 31 597,870 640,290 The Company originates loans to customers located primarily in Wuhan City, Hubei Province. The Company’s headquarters, borrowers and operations are located in Wuhan, People’s Republic of China, the epicenter for the COVID-19 pandemic. As a result of the COVID-19 outbreak which was first reported on December 31, 2019 in Wuhan, People’s Republic of China, the Chinese government imposed a lockdown on the entire Hubei Province, travel restrictions and quarantine, the Company’s borrowers and operations have been significantly disrupted. Further, all of our customers are located in Wuhan, People’s Republic of China, as a result of the COVID-19 pandemic, government lockdown, travel restrictions, reduced economic activity and quarantines imposed by the Chinese government, together with the overall domestic economy downturn, our customers’ business operations, financial conditions and cash flows were materially adversely affected, which, in turn, materially adversely affected our collection of interest and principal on our loans to customers. This geographic concentration of credit exposes the Company to a higher degree of risk associated with this economic region. The loans receivable were secured, interest at range from 1.25% to 3.30% (2021: 1.25% to 3.30%) and repayable on demand. |
Prepaid expenses
Prepaid expenses | 12 Months Ended |
Dec. 31, 2022 | |
Prepaid expenses | |
Prepaid Expenses | 15. Prepaid expenses Prepaid expenses consist of the following: As of December 31, 202 1 202 2 RMB’000 RMB’000 Prepaid expenses 848 4,629 |
Property, plant and equipment
Property, plant and equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, plant and equipment | 16. Property, plant and equipment The Company’s property, plant and equipment consisted of the following: Property Motor vehicle Office equipment & furniture Leasehold improvements Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Cost At December 31, 2020, 2021 and 2022 48,140 579 1,078 3,923 53,720 Accumulated depreciation At December 31, 2020 5,042 550 665 2,310 8,567 Depreciation 2,285 - 135 553 2,973 At December 31, 2021 7,327 550 800 2,863 11,540 Depreciation 2,286 - 113 553 2,952 At December 31, 2022 9,613 550 913 3,416 14,492 Carrying amount At December 31, 2021 40,813 29 278 1,060 42,180 At December 31, 2022 38,527 29 165 507 39,228 |
Intangible asset
Intangible asset | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Asset | 17. Intangible asset Acquired computer software RMB’000 Cost At December 31, 2020, 2021 and 2022 9 Accumulated amortization At December 31, 2020 3 Amortization 1 At December 31, 2021 4 Amortization *- At December 31, 2022 4 Carrying amount At December 31, 2021 5 At December 31, 2022 5 *Less than RMB1,000. |
Loans payable
Loans payable | 12 Months Ended |
Dec. 31, 2022 | |
Loans Payable | 18. Loans payable Loans payable represent borrowings from various individuals and companies through various securities exchanges and loans from shareholders. The average annual interest rates were approximately 12.7% and 12.7% at December 31, 2021 and 2022, respectively. As of December 31, 202 1 202 2 RMB’000 RMB’000 Loans payable to third parties 140,558 140,558 Loans payable to related parties (1) 1,011 881 Loans payable to shareholders (2) 20,000 20,000 Total 161,569 161,439 Loans payable to third parties mainly represent to loans from companies through relevant financial institutions. In June 2019, due to macroeconomic regulation and control policy promulgated by the PRC government, the financial institutions were required to cease provision of loans to various entities and their outstanding loans are in the process of recovering. No penalty will subject to this matter. As of December 31, 2022, loans payable to third parties, related parties and shareholders were all overdue. Although certain loans payable were negotiated with schedule of repayments, the Company is unable to fulfill those obligations due to liquidity issue. ______________ (1) (2) |
Convertible notes payable
Convertible notes payable | 12 Months Ended |
Dec. 31, 2022 | |
Convertible notes payable | |
Convertible Notes Payable | 19. Convertible notes payable As of December 31, 2021 2022 RMB’000 RMB’000 Liability component on initial recognition - 7,415 Interest accrued - 360 Notes converted to ADS - (517 ) Exchange difference - 6 Total - 7,264 On May 24, 2022, the Company entered into a Securities Purchase Agreement pursuant to which the Company issued an unsecured convertible promissory note with 18 months maturity (“the Note”) to an institutional accredited investor Streeterville Capital, LLC (“Investor”). The Note has the original principal amount of US$1,075,000 and Investor gave consideration of US$1.0 million, reflecting original issue discount of US$50,000 and Investor’s legal fee of US$25,000. For the convertible promissory notes issued, interest accrues on the outstanding balance of these notes at 8% per annum. The Investor may redeem all or any part of the outstanding balance of the note, at any time after six months from the issue date, in cash or converting into shares of the Company’s common stock at a price equal to 75% multiplied by the lowest daily volume weighted average price (“VWAP”) during the ten trading days immediately preceding the applicable redemption conversion,. The Company anticipates using the proceeds for general working capital purposes. As of May 25, 2022, the Company received principal in full from the Investor. As of December 31, 2022, shares of the Company’s common stock totaling 40,257,168 were issued by the Company to the Investor equaling principal amounted to US$75,000, and the Notes balance was US$1,053,244. |
Salary and benefit payable
Salary and benefit payable | 12 Months Ended |
Dec. 31, 2022 | |
Salary and benefit payable | |
Salary And Benefit Payable | 20. Salary and benefit payable As of December 31, 202 1 202 2 RMB’000 RMB’000 Salary and benefit payable to employees 7,808 9,599 Consulting expenses payable to a shareholder’s representatives (1) 2,064 2,580 Total 9,872 12,179 As of December 31, 2022, due to liquidity issue faced by the Company, the Company was unable to pay its employees on monthly basis. (1) |
Income taxes payable
Income taxes payable | 12 Months Ended |
Dec. 31, 2022 | |
Income taxes payable | |
Income Taxes Payable | 2 1 . Income taxes payable As of December 31, 2022, Chutian had not been paying its corporate income tax of RMB32.5 million to the China State Administration of Taxation since 2018 due to liquidity issue. |
Interest payable
Interest payable | 12 Months Ended |
Dec. 31, 2022 | |
Interest payable | |
Interest Payable | 2 2 . Interest payable As of December 31, 202 1 202 2 RMB’000 RMB’000 Interest payable to third parties 41,138 54,765 Interest payable to related parties (1) 1,701 1,819 Interest payable to shareholders (2) 11,846 16,226 Total 54,685 72,810 (1) (2) |
Other payable
Other payable | 12 Months Ended |
Dec. 31, 2022 | |
Other payable | |
Other Payable | 2 3 . Other payable As of December 31, 202 1 202 2 RMB’000 RMB’000 Other payable to related parties (1) 10,025 13,347 Accrued expenses 8,820 9,384 Other taxes payable (2) 2,811 3,211 Total 21,656 25,942 (1) (2) |
Share capital and additional pa
Share capital and additional paid-in capital | 12 Months Ended |
Dec. 31, 2022 | |
Share capital and additional paid-in capital | |
Share capital and additional paid-in capital | 2 4 . Share capital and additional paid-in capital (a) Authorized share capital In June 2010, the Company was incorporated in the Cayman Islands with an authorized share capital of one billion shares, par value of $0.00005, of which 20,000 shares were issued at incorporation. On March 1, 2018, the authorized share capital of the Company increased from $50,000 divided into 1,000,000,000 Ordinary Shares of a par value of $0.00005 each to $100,000 divided into 2,000,000,000 Ordinary Shares of a par value of $0.00005 each by the creation of an additional 1,000,000,000 Ordinary Shares of a par value of $0.00005 each to rank pari passu in all respects with the existing Ordinary Shares. (b) Issued share capital and additional paid-in capital Number of shares Ordinary shares Additional paid-in capital Total Non- controlling interest Total equity (thousands) RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 At January 1, 2020 1,001,131 326 383,174 383,500 95,875 479,375 Shares issued during the year 1,070 *- - - *- *- At December 31, 2020 1,002,201 326 383,174 383,500 95,875 479,375 Shares issued during the year - - - - - - At December 31, 2021 1,002,201 326 383,174 383,500 95,875 479,375 Shares issued during the year 40,257 14 510 524 - 524 At December 31, 2022 1,042,458 340 383,684 384,024 95,875 479,899 _____________ * |
Statutory reserve
Statutory reserve | 12 Months Ended |
Dec. 31, 2022 | |
Statutory reserve | |
Statutory Reserve | 2 5 . Statutory reserve In accordance with the relevant laws and regulations of the PRC, the entities established in the PRC are required to transfer 10% of profits after taxation (in accordance with the accounting regulations of the PRC) to a statutory reserve, until the reserve balance reaches 50% of the entity’s registered capital. The reserve may be used to offset accumulated losses or to increase the registered capital, subject to approval from the PRC authorities, and are not available for dividend distribution to equity owners. As of December 31, 2021 and 2022, total statutory reserves were RMB18.7 million and RMB18.7 million, respectively, which did not reach 50% of the variable interest entity’s registered capital. |
General risk reserve
General risk reserve | 12 Months Ended |
Dec. 31, 2022 | |
General risk reserve | |
General Risk Reserve | 2 6 . General risk reserve In accordance with the relevant laws and regulations of the PRC, the Company’s variable interest entity is required to maintain a general risk reserve within the equity, through appropriation of profit, which should not be less than 1.5% of the year end balance of its risk assets over the course of five years. As of December 31, 2021 and 2022, total statutory reserves were RMB9.2 million and RMB9.2 million, respectively. |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions | 2 7 . Related party transactions 1. Loans payable to related parties 1.1 In 2018, loans payable of RMB60.0 million ($9.4 million) were borrowed from a related party, Hubei Shanyin Wealth Management Co., Ltd, a company that is 69.5% owned by the former Chairman and the Chief Executive Officer, Mr Ricky Qizhi Wei, at an interest rate of 9% per annum with maturity ranging from August to October 2019. As of December 31, 2020 and 2021, these loans payable and the related interest payable were overdue. The interest expenses were RMB4.7 million ($0.7 million) and RMB4.7 million ($0.7 million) in 2021 and 2022, respectively. As of December 31, 2021 and 2022, loans payable were RMB50.0 million ($7.7 million) and RMB50.0 million ($7.3 million) and the related interest payable was RMB15.0 million ($2.4 million) and RMB19.7 million ($2.9 million), respectively. 1.2 In 2018, loans payable of RMB20.0 million ($3.0 million) were borrowed from a related party, Hubei New Nature Investment Co., Ltd (“Hubei New Nature”), a company that is 80.8% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, at an interest rate of 12% per annum and repayable in November 2019. In December 2018, loan of RMB0.5 million ($70,000) was repaid. In 2019, loans payable of RMB17.3 million ($2.5 million) were further borrowed, loans of RMB14.7 million ($2.1 million) were repaid. In 2019, certain loans receivable were novated to Hubei New Nature to offset against loans payable of RMB9.9 million ($1.4 million) and interest payable of RMB3.1 million ($0.5 million) to Hubei New Nature. In 2020, certain loans receivable were novated to Hubei New Nature to offset against loans payable of RMB1.7 million ($0.3 million) and interest payable of RMB0.5 million ($0.1 million) to Hubei New Nature. In 2021 and 2022, the company made repayment amounting to RMB10 million ($1.6 million) and RMB130,000 ($19,000) respectively. The interest expenses were RMB1.4 million ($0.2 million), RMB0.7 million ($0.1 million) and RMB118,000 ($17,000) in 20120, 2021 and 2022, respectively. As of December 31, 2021 and 2022, loans payable were RMB1.0 million ($0.2 million) and RMB0.9 million ($0.1 million), and the related interest payable was RMB1.7 million ($0.3 million) and RMB1.8 million ($0.3 million), respectively. 2. Loans payable to shareholders 2.1 In June 2017, a loan payable of RMB10.0 million ($1.5 million) was borrowed from Wang Hailin, a shareholder who owned 7.7% of the VIE, at 10% interest per annum. The interest expenses for this loan were RMB0.5 million ($0.1 million) and RMB1.3 million ($0.2 million) in 2017 and 2018, respectively. According to the loan extension agreement, the loan of RMB10.0 million ($1.5 million) is at interest rate of 15% per annum with additional 9% penalty interest per annum and repayable in February 2019. Subsequent to year end, this loan payable was further extended to repayment date in September 2019, at 15% interest per annum with additional 9% penalty interest. As of December 31, 2021 and 2022, the loan payable and interest payable were overdue. As of December 31, 2021 and 2022, loans payable were RMB 10.0 million ($1.6 million) and RMB 10.0 million ($1.5 million), respectively. As of December 31, 2021 and 2022, interest payable was RMB6.6 million ($1.0 million) and RMB9.0 million ($1.3 million), respectively. 2.2 In 2019, loans payable of RMB 3.0 million ($0.4 million) and RMB 10.0 million ($1.4 million) were borrowed from Li Ling, a shareholder who owned 2.5% of the VIE, at 12% per annum for 29 days and 74 days, respectively. At maturity, loan payable of RMB 3.0 million ($0.4 million) and the related interest of RMB 29,000 ($4,200) were fully repaid. Loan payable of RMB 10.0 million ($1.4 million) was, however, overdue. On August 27, 2019, Li Ling applied to the Wuhan Wuchang People’s Court for pre-litigation property preservation of respondents Chutian and Mr. Wei in connection with a loan contract dispute. Court issued a preservation order that froze the bank deposits of Chutian and Mr. Wei in the amount of RMB 12.0 million ($1.7 million), or to seize or attach property in the corresponding value. On October 9, 2019, the case was filed and accepted in the Wuhan Jiang’an People’s Court. Li Ling filed the following actions with the court: (1) that the two defendants Chutian and Mr. Wei repay the borrowed principal of RMB 10.0 million ($1.4 million) and interest of RMB 787,500 ($114,100) (based on the interest rate of 1.125% per month on the principal of RMB 10.0 million ($1.4 million), calculated from February 1, 2019 until fully paid, currently calculated until August 30, 2019), and (2) the costs of litigation to be fully borne by both defendants. On December 4, 2019, the court ruled that there was a valid loan relationship, that Chutian had failed to repay the loan as agreed and that Li Ling had the right to request full repayment of the loan principal and interest. The court ordered Chutian to repay the principal amount of the loan of RMB 10.0 million ($1.4 million) to Li Ling, and to pay the interest rate of 1.125% per month on the principal amount of RMB 10.0 million ($1.4 million), beginning February 2019 until the date the loan is fully paid. The court further ordered that Mr. Wei shall also be jointly and severally liable for the repayment of the loan. In the event that the repayment obligation is not fulfilled, the court ordered that the debt interest would be doubled in accordance with PRC law. On May 20, 2020, due to the failure of Chutian to fulfil its obligation to repay the principal amount determined above, the court issued a consumer restriction order against Mr. Wei to restrict high consumption and high expenditure behaviors. Violation of this order carries the imposition of fines and detention, and in circumstances sufficiently serious to constitute a crime, pursuit of criminal liability according to law. On July 27, 2020, the court terminated the enforcement proceeding and will recommence the enforcement proceeding if enforceable assets are located and meet the enforcement requirements. As a result of the court ruling mentioned above, the interest expense on these loans was RMB 2.0 million ($0.3 million) in 2021 and 2022 respectively. As of December 31, 2021 and 2022, loan payable was RMB 10.0 million ($1.6 million) and RMB 10.0 million ($1.5 million), and interest payable was RMB 5.3 million ($0.8 million) and RMB7.3 million ($1.0 million). 3. Consulting expenses for representatives from a shareholder Consulting expenses of RMB 0.5 million ($70,000), RMB 0.5 million ($70,000 ) and RMB 0.5 million ($70,000) were incurred for two representatives sent from Hubei Daily, a shareholder who owned 20% of the VIE, for the years ended December 31, 2020, 2021 and 2022, respectively. As of December 31, 2021 and 2022, consulting expenses payable to these representatives were RMB 2.0 million ($0.3 million) and RMB 2.5 million ($0.4 million), respectively. 4. Reverse merger expenses and guarantee expenses payable to a related party During the reverse merger process of the Company, a related party, Hubei New Nature Investment Co., Ltd (“Hubei New Nature”), a company that is 80.8% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, paid reverse merger expenses on behalf of the Company, totaling RMB 11.3 million ($1.7 million) and RMB 10.9 million ($1.6 million) for the year ended December 31, 2017 and 2018, respectively. In 2019, certain operating expenses of RMB 0.7 million ($100,000) were paid by Hubei New Nature on behalf of the Company. Also, in 2019, certain loans receivable were novated to Hubei New Nature to offset against payable to Hubei New Nature of RMB 22.6 million ($3.3 million). In 2020, certain loan receivables were novated to Hubei New Nature of RMB 1.3 million ($0.2 million) (see Note 27 of Notes to Consolidated Financial Statements, Section 5). In 2020, certain operating expenses of RMB 2.8 million ($0.4 million) were paid by Hubei New Nature on behalf of the Company. In 2021, the Company’s debts amounting to RMB 0.7 million ($0.1 million) was assigned and assumed to Hubei New Nature. In 2022, the Company made the repayment amounting to RMB484,000. In addition, guarantee expenses of RMB 2.8 million ($0.4 million) and RMB 2.8 million ($0.4 million) were incurred for Hubei New Nature for the years ended December 31, 2021 and 2022, respectively. As of December 31, 2021 and 2022, payables to Hubei New Nature were RMB 8.1 million ($1.3 million) and RMB 10.5 million ($1.5 million), respectively. 5. Loans receivable from related parties 5.1 In 2016, loans receivable of RMB 8.0 million ($1.2 million) were lent to Hubei Baoli Ecological Conservation Co., Ltd at an interest rate of 36% per annum. The loan was guaranteed by Ms. Jing Liang, a shareholder who owned 4.3% of the VIE. The interest received on the loan was nil, nil and nil for the years ended December 31, 2020, 2021 and 2022, respectively. As of December 31, 2021 and 2022, this loan was overdue. 5.2 In 2016, loans receivable of RMB3.0 million ($0.4 million) were lent to Kang Chen at an interest rate of 36% per annum. The loan was guaranteed by Ms. Jing Liang, a shareholder who owned 4.3% of the VIE. As of December 31, 2021 and 2022 this loan was overdue. 6. Loans receivable novated and debts transferred to a related party In 2020, certain loans receivable were novated to a related party, Hubei New Nature to offset loans payable of RMB1.7 million ($0.2 million) and interest payable of RMB0.5 million ($70,000). In 2021, certain debts amounting to RMB0.7 million ($0.1 million) were transferred to Hubei New Nature. 7. Debts transferred to a related party In 2021, certain debts amounting to RMB1.4 million ($0.2 million) were assumed by the former Chairman and the Chief Executive Officer, Mr. Wei. |
Legal proceedings
Legal proceedings | 12 Months Ended |
Dec. 31, 2022 | |
Legal proceedings | |
Legal Proceedings | 2 8 . Legal proceedings Proceedings incidental to our lending business 28.1 On July 24, 2017, Chutian filed an execution case with the Wuhan Wuchang District People’s Court for property preservation on Hubei Sheng Guang Gong Pharmaceutical Co., Ltd and related borrowers. On August 20, 2019, Chutian further filed the real estate valuation report to the court for further processing. In August 2020, the secured real estate were auctioned for RMB2.56 million($0.4 million). However, as of the date of this annual report, the proceeds are still held by Wuhan Wuchang People’s Court pending resolution of various ongoing legal proceedings. Property Preservation Proceedings 28.2 On July 16, 2019, Shenzhen Lihe Wantong Commerical Factoring Co., Ltd (深圳立合旺通商业保理有限公司)(“Shenzhen Lihe Wangtong”) applied to the Wuhan Wuchang People’s Court for pre-litigation protective measures to be taken against the respondents Chutian and Mr. Wei with regards to a contract dispute. On July 31, 2019, the court issued a preservation order freezing a total of RMB12.3 million ($1.8 million) of deposits in the bank accounts of Chutian and Mr. Wei for a period of one (1) year; and seizing four properties of Mr. Wei and Ms. Peng Yan, Mr. Wei’s wife. The total limit of the property preservation in this matter is RMB29.9 million ($4.3 million). As of the date of this annual report, our cash deposits and properties have not been released from the preservation order. Chutian and Mr. Wei are negotiating with Shenzhen Lihe Wangtong to reach a mediation agreement. 28.3 On September 4, 2019, Hubei Changjiang Microcredit Co., Ltd (湖北长江小额贷款有限公司) (“Hubei Changjiang”) applied to the Wuhan Wuchang People’s Court for pre-litigation property preservation of respondents Mr. Wei and Ms. Peng Yan, Mr. Wei’s wife, Chutian, Hubei New Nature Investment Co., Ltd and Dunxin Holdings Co., Ltd in connection with a loan contract dispute. On September 6, 2019, the court issued a preservation order seizing the bank deposits, or property in the corresponding value, of Mr. Wei, Ms. Peng Yan, Chutian, Hubei New Nature Investment Co., Ltd and Dunxin Holdings Co., Ltd in the amount of RMB13.0 million ($1.8 million) and RMB12.0 million ($1.7 million). Hubei New Nature Investment Co., Ltd is a company that is 80.8% owned by the former Chairman and the Chief Executive Officer, Mr. Wei. Dunxin Holdings Co., Ltd is a company that is 70% owned by the former Chairman and the Chief Executive Officer, Mr. Wei and 30% owned by Ms. Wenting (Tina) Xiao, Chief Personal/Human Resource Officer. The Court’s ruling was effective immediately. In July 2020, Hubei Changjiang applied for court enforcement and execution, which was accepted. As of the date of this annual report, all parties are still in negotiation of a mediation agreement. 28.4 On October 14, 2019, Mr. Deng Xinxue, Mr. Zhang Xuan and Mr. Yang Bobiao each applied to the Wuhan Wuchang People’s Court for pre-litigation property preservation of respondents Hubei Shanyin Wealth Management Co., Ltd (湖北善银财富管理有限公司), a company that is 69.5% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, and Chutian in connection with loan contract disputes. The court issued a preservation order seizing the bank deposits, or property in the corresponding value, of Hubei Shanyin Wealth Management Co., Ltd and Chutian in the amount of RMB2.9 million ($0.4 million), RMB9.0 million ($1.3 million) and RMB9.0 million ($1.3 million), respectively. The court’s ruling was effective immediately. As of the date of this annual report, our cash deposits and properties have not been released from the preservation order and all parties are still in negotiation of a mediation agreement. 28.5 On October 15, 2019, the Wuhan Wuchang People’s Court received a Letter of Property Preservation from the Wuhan Arbitration Commission in connection with a loan contract dispute among the applicant Hubei Huaya Investment Co., Ltd (湖北华亚投资有限公司) and respondents Mr. Wei, Ms. Peng Yan, and Chutian. On October 23, 2019, after review of the letter by the court, the court issued a preservation order seizing the bank deposits, or property in the corresponding value, of Mr. Wei, Ms. Peng Yan, and Chutian in the amount of RMB12.3 million ($1.8 million). In August 2020, the parties entered into a mediation agreement whereby Mr. Wei and Ms. Yan agreed to pay the loan principal with penalty interests and costs in connection with the legal proceeding while Chutian, as the third respondent, will be responsible for 50% of the liabilities of Mr. Wei and Ms. Yan under the mediation agreement, should they fail to make the payments. As of the date of this annual report, Mr. Wei and Ms. Yan are still making payments pursuant to the mediation agreement. Property Services Contract Proceeding 28.6 On September 26, 2019, the Wuhan Branch of Xiamen Lianfa (Group) Property Services Co., Ltd (“Xiamen Lianfa”) filed an action in the Wuhan Wuchang People’s Court against Chutian in connection with a property service contract dispute. On November 27, 2019, the case was scheduled to be heard and Chutian was lawfully summoned and failed to appear, and did not submit a reply. The case was decided and concluded on November 27, 2019. The court found that Chutian failed to pay the owed property services fees to Xiamen Lianfa from April 1, 2019 to August 31, 2019. The court rendered a judgment in favor of Xiamen Lianfa and ordered Chutian to pay property services fee in the amount of RMB193,944 ($27,000) for the period from April 1, 2019 to August 31, 2019 to Xiamen Lianfa, within 10 days of the judgment. The court further ordered Chutian to pay the accrued interest, to be calculated based on the principal amount of RMB193,944 ($27,000) and based on the People’s Bank of China lending interest rate for the period from September 26, 2019 until fully paid. In the event that the repayment obligation is not fulfilled, the court ordered that the debt interest would be doubled in accordance with PRC law. Chutian did not appeal the judgment and the judgment became effective immediately. On November 10, 2020, court issued a preservation order that froze the assets of Chutian in the maximum amount of RMB 220,000 ($32,000) or to seize or attach property in the corresponding value. On December 18, 2020, the court terminated the enforcement proceeding and will recommence the enforcement proceeding if enforceable assets are located and meet the enforcement requirements within five years. In August, 2019, Xiamen Lianfa filed an action in the Wuhan Wuchang People’s Court against Chutian in connection with a property service contract dispute. The case was decided and concluded on October 12, 2020. The court found that Chutian failed to pay the owed property services fees to Xiamen Lianfa from September 1, 2019 to April 30, 2020. The court rendered a judgment in favor of Xiamen Lianfa and ordered Chutian to pay property services fee in the amount of RMB310,311 ($46,000) for the period from September 1, 2019 to April 30, 2020 to Xiamen Lianfa, within 10 days of the judgment. The court further ordered Chutian to pay the accrued interest, to be calculated based on the principal amount of RMB310,311 ($46,000) and based on the People’s Bank of China lending interest rate for the period from September 11, 2020 until fully paid. In the event that the repayment obligation is not fulfilled, the court ordered that the debt interest would be doubled in accordance with PRC law. Chutian did not appeal the judgment and the judgment was effected immediately. In July 2021, the court issued the notice of enforcement. In 2021, Xiamen Lianfa filed an action in the Wuhan Wuchang People’s Court against Chutian in connection with a property service contract dispute. The case was decided and concluded on November 29, 2021. The court found that Chutian failed to pay the owed property services fees to Xiamen Lianfa from May 1, 2019 to October 30, 2020. The court rendered a judgment in favor of Xiamen Lianfa and ordered Chutian to pay property services fee in the amount of RMB238,344 ($37,000) for the period from May 1, 2019 to October 30, 2020 to Xiamen Lianfa, within 10 days of the judgment. The court further ordered Chutian to pay the accrued interest, to be calculated based on the principal amount of RMB238,344 ($37,000) and based on the People’s Bank of China lending interest rate for the period until fully paid. Chutian did not appeal the judgment and the judgment was effected immediately. In November 2021, the court issued the notice of enforcement. As of the date of this annual report, Xiamen Lianfa and the Company are in negotiation of a mediation agreement. Li Ling Loan Dispute Proceeding 28.7 On August 27, 2019, Ms. Li Ling applied to the Wuhan Wuchang People’s Court for pre-litigation property preservation of respondents Chutian and Mr. Wei in connection with a loan contract dispute. The court issued a preservation order that froze the bank deposits of Chutian and Mr. Wei in the amount of RMB12.0 million ($1.7 million), or to seize or attach property in the corresponding value. Li Ling Loan Dispute Proceeding On October 9, 2019, the case was filed and accepted in the Wuhan Jiang’an People’s Court. Li Ling filed the following actions with the court: (1) that the two defendants Chutian and Mr. Wei repay the borrowed principal of RMB 10.0 million ($1.4 million) and interest of RMB787,500 ($114,000) (based on the interest rate of 1.125% per month on the principal of RMB10.0 million ($1.4 million), calculated from February 1, 2019 until fully paid, currently calculated until August 30, 2019), and (2) the costs of litigation to be fully borne by both defendants. On December 4, 2019, the court ruled that there was a valid loan relationship, that Chutian had failed to repay the loan as agreed and that Ms. Li Ling had the right to request full repayment of the loan principal and interest. The court ordered Chutian to repay the principal amount of the loan of RMB10.0 million ($1.4 million) to Ms. Li Ling, and to pay the interest rate of 1.125% per month on the principal amount of RMB10.0 million ($1.4 million), beginning February 2019 until the date the loan is fully paid. The court further ordered that Mr. Wei shall also be jointly and severally liable for the repayment of the loan. In the event that the repayment obligation is not fulfilled, the court ordered that the debt interest would be doubled in accordance with PRC law. On May 20, 2020, due to the failure of Chutian to fulfill its obligation to repay the principal amount determined above, the court issued a consumer restriction order against Mr. Wei to restrict high consumption and high expenditure behaviors. Violation of this order carries the imposition of fines and detention, and in circumstances sufficiently serious to constitute a crime, pursuit of criminal liability according to law. On July 27, 2020, the court terminated the enforcement proceeding and will recommence the enforcement proceeding if enforceable assets are located and meet the enforcement requirements. Cases Entered into the Enforcement Process Chutian had a total of nine cases entered into the enforcement process for the year ended December 31, 2022, all of which were accepted and enforced by the Wuhan Wuchang District People’s Court, with an aggregate amount of RMB17,262,222 (US$2,554,449). All of the nine cases entered into the enforcement process have been terminated by the Wuhan Wuchang District People’s Court because there were no other assets of Chutian available for enforcement. However, pursuant to the Civil Procedure Law of the People's Republic of China, once the court or the applicant petitioning for enforcement locates clues that Chutian owns new property or assets available for enforcement, the court may resume the enforcement procedure. |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events | 2 9 . Subsequent events COVID-19 pandemic has brought about an unprecedented challenge for many entities with increased uncertainty in the global economy. As the situation is still evolving the full effect of the outbreak is still uncertainty and the Company is therefore unable to provide a quantitative estimate of the potential impact of this outbreak on the Company. The Company continues to monitor and evaluate any possible impact on the Company’s business and will consider implementation of various measures to mitigate the effects arising from the COVID-19 situation. |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Basis Of Preparation | (i) Compliance with IFRS The consolidated financial statements of the Company have been prepared in accordance with applicable International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. (ii) Historical cost convention The financial statements have been prepared on a historical cost basis. (iii) Liquidity These consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue its operations in the foreseeable future and that the Company will be able to realize its assets and discharge its liabilities in the normal course of operations. As shown in the accompanying financial statements as of December 31, 2022, the Company had incurred a net loss of RMB30.3 million (US$4.5 million). Besides, the COVID-19 was contained in China 2022, the Company had made specific allowance for the receivables with amount to RMB 42.4 million (US$6.3 million) as of December 31 2022 based on the specific risk of collectability of the receivables. The Company funded these losses through: (1) the continued financial support from its related party or its ability to obtain external financing; or (2) further implementing management’s business plan to enter into new business and generate sufficient revenues to meet its obligations. As of December 31, 2022, the Company’s having a minimum cash balance on the consolidated statement of financial statement. The Company has taken an intensive review of operations and expenditures, including selling, distribution, and administration expenses, to identify and eliminate inefficiencies and redundancies in order to preserve cash while maintaining the business. Given the Company’s existing cash balances and projected cash generated by, and used in, operating activities, the Company believes that it will have sufficient liquidity to fund its operating activities, and react as necessary to market changes, which may include working capital needs for at least twelve months from December 31, 2022. These consolidated financial statements do not reflect adjustments to the carrying value of assets and liabilities, reported expenses and statement of financial position classification that would be necessary if going concern assumption was not appropriate. These adjustments could be material. The Company has historically met its cash needs through a combination of cash flows from operating activities, loans payable from third parties raised through various securities exchanges, loans from shareholders and loans from related parties. The cash requirements of the Company are generally for operating activities and repayments of loans from third parties, related parties and shareholders. Ever since securities exchanges have ceased offering any form of financing to the Company through their platforms as well as loans receivable were credit-impaired, the Company ran into severe liquidity issue. In the beginning of 2019, the Company began to default in certain loans payable, even though certain loans payable were negotiated for revised repayment terms. With loans receivables continued to be further credit-impaired, all obligations of loans payable were defaulted. The liquidity issue of the Company has further severely affected its ability to pay its taxes, service providers, employees and others. Due to non-payment of its obligations when due, multiple significant legal proceedings were initiated by its shareholders, service providers and others against the Company (see Note 28 - Legal proceedings for detailed disclosure). The Company has taken an intensive review of operations and expenditures, including intensifying loan and interest collection initiative and monetizing collaterals of loans receivable. The Company has also acquired the financial support letter from Hubei New Nature Investment Co., Ltd, a company that is 80.8% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, and from Dunxin Holdings Co., Ltd, a company that is 70% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, which have expressed the willingness and intention to provide the necessary financial support to the Company. Further, the Company plans to actively seek equity financing from private placements, so as to enable the Company to meet its liabilities as and when it falls due and to carry on its business without a significant curtailment of operations for the next 12 months from the issuance date of this report. (iii) Liquidity - continued The Company believes that available cash and cash equivalents, future cash provided by operating activities, together with the efforts from aforementioned management plan and actions, should enable the Company to meet presently anticipated cash needs for at least the next 12 months after the date that the financial statements are issued and the Company has prepared the consolidated financial statements on a going concern basis. However, the Company continues to have ongoing obligations and it expects that it will require additional capital in order to execute its longer-term business plan. If the Company encounters unforeseen circumstances that place constraints on its capital resources, management will be required to take various measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing the Company’s business development activities, suspending the pursuit of its business plan, controlling operating expenses and seeking to further dispose of non-core assets. Management cannot provide any assurance that the Company will raise additional capital if needed. |
Basis Of Consolidation | (i) Subsidiaries Subsidiaries are entities (including variable interest entity) over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases. The acquisition method of accounting is used to account for business combinations by the Company. Intercompany transactions, balances and unrealized gains on transactions between group companies are eliminated in preparing the consolidated financial statements. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Company. (ii) Non-controlling interests Non-controlling interests in the results and equity of subsidiaries are shown separately in the Consolidated Statements of Profit and Other Comprehensive Income, the Consolidated Statements of Financial Position and Consolidated Statements of Changes in Shareholders’ Equity respectively. |
Business Combinations | The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the: · fair values of the assets transferred; · liabilities incurred to the former owners of the acquired business; · equity interests issued by the Company; · fair value of any asset or liability resulting from a contingent consideration arrangement; and · fair value of any pre-existing equity interest in the subsidiary. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are with limited exceptions, measured initially at their fair values at the acquisition date. The Company recognizes any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets. Acquisition-related costs are expensed as incurred. The excess of the · consideration transferred, · amount of any non-controlling interest in the acquired entity, and · acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain purchase. |
Segments | Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segment, has been identified as the steering committee that makes strategic decisions. The Company operates in only one segment. |
Foreign Currency Translation | (j)Functional and presentation currency Items included in the financial statements of each of the Company’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The consolidated financial statements are presented in Chinese Renminbi (RMB), which is the Company’s presentation currency. (ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognized in the statement of profit and other comprehensive income. Foreign exchange gains and losses are presented in the Consolidated Statements of Profit and Other Comprehensive Income on a net basis within other income or other expenses. (iii) Group companies The results and financial position of all the Group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows: (a) assets and liabilities for each consolidated statement of financial position presented are translated at the closing rate at the date of that consolidated statement of financial position; (b) income and expenses for each consolidated statement of profit and other comprehensive income are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and (c) all resulting exchange differences are recognized in other comprehensive income. |
Interest | Interest (IFRS 9 - 2020, 2021 and 2022) Interest income and expense for all financial instruments are recognized in “Net interest income” as “Interest income” and “Interest expense” in the Consolidated Statement of Profit and Other Comprehensive Income using the effective interest method. Interest income for financial assets held at amortized cost is recognized in profit or loss using the effective interest method. The effective interest rate is the rate that exactly discount estimated future cash payments or receipts through the expected life of the financial asset or financial liability (or, where appropriate, a shorter period) to the gross carrying amount of a financial asset (i.e. its amortized cost before any impairment allowance) or to the amortized cost of a financial liability. When calculating the effective interest rate, the Company estimates cash flows considering all contractual terms of the financial instrument but does not consider expected credit losses and includes transaction costs, premiums or discounts and fees and points paid or received that are integral to the effective interest rate, such as origination fees. When the Company revises the estimates of future cash flows, the carrying amount of the respective financial assets or financial liability is adjusted to reflect the new estimate discounted using the original effective interest rate. Any changes are recognized in profit or loss. The interest income / interest expense is calculated by applying the effective interest rate to the gross carrying amount of non-credit impaired financial assets (i.e. at the amortized cost of the financial asset before adjusting for any expected credit loss allowance), or at amortized cost of financial liabilities. Interest income for financial assets that are amortized cost that have become credit-impaired subsequent to initial recognition is recognized using the credit adjusted effective interest rate. This rate is calculated in the same manner as the effective interest rate except that expected credit losses are included in the expected cash flows. Interest income is therefore recognized on the amortized cost of the financial asset including expected credit losses. Should the credit risk on a credit-impaired financial asset improve such that the financial asset is no longer considered credit-impaired, interest income recognition reverts to a computation based on the rehabilitated gross carrying value of the financial asset. A contract modification is a change in the scope or interest rate (or both) of a contract that is approved by the parties to the contract. A contract modification exists when the parties to a contract approve a modification that either creates new or changes existing enforceable rights and obligations of the parties to the contract. When a contract modification is not accounted for as a separate contract, the Company shall account for the contract modification as if it were a part of the existing contract as the remaining services are not distinct and therefore, form part of single performance obligation that is partially satisfied at the date of the contract modification. The effect that the contract modification has on the interest rate, and on the entity’s measure of progress towards complete satisfaction of the performance obligation, is recognized as an adjustment to interest income (either as an increase in or a reduction of interest income) at the date of the contract modification (i.e., the adjustment to interest income is made on a cumulative catch-up basis). |
Income Tax | Income tax expense comprises current and deferred tax. It is recognized in the Consolidated Statements of Profit and Other Comprehensive Income. i. Current tax Current tax comprises the expected tax payable or receivable on taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payable or receivable is the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantially enacted at the reporting date. ii. Deferred tax Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets or liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets are recognized for deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Future taxable profits are determined based on business plans for individual subsidiaries and variable interest entity in the Company and the reversal of temporary differences. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Unrecognized deferred tax assets are reassessed at each reporting date and recognized to the extent that it has become probable that future taxable profits will be available against which they can be used. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantially enacted at the reporting date. The measurement of deferred tax reflects the tax consequences that would follow the manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. iii. Tax exposures In determining the amount of current and deferred tax, the Company considers the impact of tax exposures, including whether additional taxes and interest may be due. This assessment relies on estimates and assumptions and may involve a series of judgments about future events. New information may become available that causes the Company to change its judgments regarding the adequacy of existing tax liabilities; such changes to tax liabilities would impact tax expense in the period in which such a determination is made. |
Financial assets and financial liabilities (IFRS 9 - 2020, 2021 and 2022 only) | i Initial recognition and measurement Financial assets and financial liabilities are recognized when the entity becomes a party to the contractual provisions of the instrument. At initial recognition, the Company measures a financial asset or financial liability at its fair value plus or minus transaction costs that are incremental and directly attributable to the acquisition or issue of the financial asset or financial liability, such as fees and commissions. Immediately after initial recognition, an expected credit loss allowance is recognized for financial assets measured at amortized cost, which results in an accounting loss being recognized in profit or loss when an asset is newly originated. ii Classification and subsequent measurement Management determines the classification of its financial assets and liabilities at initial recognition of the instrument or, where applicable, at the time of reclassification. Financial assets From January 1, 2018, the Company has applied IFRS 9 and classifies its financial assets into amortized cost measurement category. The Company’s financial assets that are held to collect the contractual cash flows and which contain contractual terms that give rise on specified dates to cash flows that are solely payments of principal and interest (“SPPI”) are measured at amortized cost. Financial liabilities The Company classifies its financial liabilities as measured at amortized cost. iii Derecognition Financial assets The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. In transactions in which the Company neither retains or transfers substantially all of the risks and rewards of ownership of a financial asset and its retains control over the asset, the Company continues to recognize the asset to the extent of its continuing involvement, determined by the extent to which it is exposed to changes in the value of the transferred asset. Financial liabilities The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. iv Amortized cost measurement The “amortized cost” of a financial asset or financial liability is the amount at which the financial asset or financial liability is measured at initial recognition, minus principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount and, for financial assets, adjusted for any loss allowance. v. Identification and measurement of impairment IFRS 9 outlines a “three-stage” model for impairment based on changes in credit quality since initial recognition as summarized below: · A financial instrument that is not credit-impaired on initial recognition is classified in “Stage 1” and has its credit risk continuously monitored by the Company. · If a significant increase in credit risk since initial recognition is identified, the financial instrument is moved to “Stage 2” but is not yet deemed to be credit-impaired. · If the financial instrument is credit-impaired, the financial instrument is then moved to “Stage 3”. · Financial instruments in Stage 1 have their expected credit loss measured at an amount equal to the portion of lifetime expected credit losses that result from default events possible within the next 12 months. Financial instruments in Stages 2 or 3 have their expected credit loss measured based on expected credit losses on a lifetime basis. · A pervasive concept in measuring expected credit loss in accordance with IFRS 9 is that it should consider forward looking information. Significant increase in credit risk The Company monitors its financial assets that are subject to the impairment requirements to assess whether there has been a significant increase in credit risk since initial recognition. If there has been a significant increase in credit risk the Company will measure the loss allowance based on lifetime rather than 12-month expected credit loss. The Company’s accounting policy is not to use the practical expedient that financial assets with “low” credit risk at the reporting date are deemed not to have had a significant increase in credit risk. As a result, the Company monitors all financial assets that are subject to impairment for significant increase in credit risk. In assessing whether the credit risk on a financial instrument has increased significantly since initial recognition, the Company compares the risk of a default occurring on the financial instrument at the reporting date based on the remaining maturity of the instrument with the risk of a default occurring that was anticipated for the remaining maturity at the current reporting date when the financial instrument was first recognized. In making this assessment, the Company considers both quantitative and qualitative information that is reasonable and supportable, including historical experience and forward-looking information that is available without undue cost or effort, based on the Company’s historical experience and expert credit assessment including forward-looking information. The quantitative information is a primary indicator of significant increase in credit risk and is based on the change in lifetime probability of default by comparing: · the remaining lifetime probability of default at the reporting date; with · the remaining lifetime probability of default for this point in time that was estimated based on facts and circumstances at the time of initial recognition of the exposure. The probability of defaults used are forward looking and the Company uses the same methodologies and data used to measure the loss allowance for expected credit loss. The qualitative factors that indicate significant increase in credit risk are reflected in probability of default models on a timely basis. Given that a significant increase in credit risk since initial recognition is a relative measure, a given change, in absolute terms, in the probability of default will be more significant for a financial instrument with a lower initial probability of default than compared to a financial instrument with a higher probability of default. As a back-stop when an asset becomes 30 days past due, the Company considers that a significant increase in credit risk has occurred and the asset is in stage 2 of the impairment model, i.e. the loss allowance is measured as the lifetime expected credit loss. Credit-impaired financial assets A financial asset is “credit-impaired” when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Credit-impaired financial assets are referred to as Stage 3 assets. Evidence of credit-impairment includes observable data about the following events: · Significant financial difficulty of the borrower; · a breach of contract such as a default or past due event; or · the lender of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, having granted to the borrower a concession that the lender would not otherwise consider. It may not be possible to identify a single discrete event - instead, the combined effect of several events may have caused financial assets to become credit-impaired. A loan is considered credit-impaired when a concession is granted to the borrower due to a deterioration in the borrower’s financial condition, unless there is evidence that as a result of granting the concession the risk of not receiving the contractual cash flows has reduced significantly and there are no other indicators of impairment. For financial assets where concessions are contemplated but not granted the asset is deemed credit impaired when there is observable evidence of credit-impairment including meeting the definition of default. The definition of default (see below) include unlikeliness to pay indicators. Definition of default Critical to the determination of expected credit loss is the definition of default. The definition of default is used in measuring the amount of expected credit loss and in the determination of whether the loss allowance is based on 12-month or lifetime expected credit loss, as default is a component of the probability of default which affects both the measurement of expected credit losses and the identification of a significant increase in credit risk. The Company considers the following as constituting an event of default: · the borrower is past due more than nine months on any material credit obligation to the Company; or · the borrower is unlikely to pay its credit obligations to the Company in full. When assessing if the borrower is unlikely to pay its credit obligation, the Company takes into account both qualitative and quantitative indicators. Quantitative indicators, such as overdue status and non-payment on another obligation of the same counterparty are key inputs in this analysis. The Company uses a variety of sources of information to assess default which are either developed internally or obtained from external sources. Objective evidence of impairment At each reporting date, the Company assesses whether there is objective evidence that financial assets are impaired. A financial asset or a group of financial assets is impaired when objective evidence demonstrates that a loss event has occurred after the initial recognition of the assets and that the loss event has an impact on the future cash flows of the assets and that the loss event has an impact on the future cash flows of the assets that can be estimated reliably. Objective evidence that financial assets are impaired includes: · significant financial difficulty of the borrower; · default or delinquency by a borrower; · the restructuring of a loan by the Company on terms that the Company would not consider otherwise; · indications that a borrower will enter bankruptcy; or · observable data relating to a group of assets such as adverse changes in the payment status of borrowers in the Company, or economic conditions that correlate with defaults in the Company. The Company recognizes loss allowance for expected credit loss on loan receivables. Expected credit losses are required to be measured through a loss allowance at an amount equal to: · 12-month expected credit loss, i.e. lifetime expected credit loss that result from those default events on the financial instrument that are possible within 12 months after the reporting date, (referred to as Stage 1); or · Full lifetime expected credit loss, i.e. lifetime expected credit loss that result from all possible default events over the life of the financial instrument, (referred to as Stage 2 and Stage 3). A loss allowance for full lifetime expected credit loss is required for a financial instrument if the credit risk on that financial instrument has increased significantly since initial recognition. For all other financial instruments, expected credit losses are measured at an amount equal to the 12-month expected credit loss. Expected credit losses are computed as unbiased, a probability-weighted estimate of the present value of credit losses. These are measured as the present value of the difference between the cash flows due to the Company under the contract and the cash flows that the Company expects to receive by evaluating a range of reasonably possible outcomes, the time value of money, and considering all reasonable and supportable information including that which is forward-looking, discounted at the asset’s effective interest rate. For Stage 1 and 2 loans, the estimate of expected cash shortfalls over the life time of the loans is determined by multiplying the probability of default (“PD”) with the loss given default (“LGD”). For credit-impaired financial instruments (Stage 3 loans), the estimate of cash shortfalls may require the use of expert credit judgment. Cash shortfalls are discounted using the effective interest rate on the financial instrument as calculated at initial recognition. The Company’s initial contractual loan terms are within 12 months. For simplification purpose, for Stage 1 and Stage 2 loans, the Company recognized the expected credit losses for the lifetime of the loans. Stage 1: Expected credit losses are recognized at the time of initial recognition of a financial instrument and represent the lifetime cash shortfalls arising from possible default events for the life of loan from the balance sheet date. Expected credit losses continue to be determined on this basis until there is either a significant increase in the credit risk of an instrument or the instrument becomes credit-impaired. Stage 2: If a financial asset experiences a significant increase in credit risk since initial recognition, an expected credit loss provision is recognized for default events that may occur over the lifetime of the asset. Significant increase in credit risk is assessed by comparing the risk of default of an exposure at the reporting date to the risk of default at origination (after taking into account the passage of time). Significant does not mean statistically significant nor is it assessed in the context of changes in expected credit loss. Whether a change in the risk of default is significant or not is assessed using a number of quantitative and qualitative factors, the weight of which depends on the type of product and counterparty. Financial assets that are 30 or more days past due and not credit-impaired will always be considered to have experienced a significant increase in credit risk. Stage 3: Financial assets that are credit-impaired (or in default) represent those that are past due more than the historical average collection period for past due loans, but not to exceed the original contractual loan terms. Financial assets are also considered to be credit-impaired where the obligors are unlikely to pay on the occurrence of one or more observable events that have a detrimental impact on the estimated future cash flows of the financial asset. It may not be possible to identify a single discrete event but instead the combined effect of several events may cause financial assets to become credit-impaired. Loss provisions against credit-impaired financial assets are determined based on an assessment of the recoverable cash flows under a range of scenarios, including the realization of any collateral held where appropriate. The loss provisions held represent the difference between the present value of the cash flows expected to be recovered, discounted at the instrument’s original effective interest rate, and the gross carrying value of the instrument prior to any credit impairment. |
Cash, Cash Equivalents And Restricted Cash | For the purpose of the consolidated cash flow statements, cash, cash equivalents and restricted cash consist of balances with banks and restricted cash with banks. |
Prepaid Expenses | Prepaid expenses represent to advances to the suppliers for providing services to the Company. The suppliers usually require advance payment when the Company orders services and prepaid expenses will be utilized to offset the Company's future payments. These amounts are unsecured, non-interest bearing and generally short-term in nature. |
Property, plant and equipment | Property, plant and equipment are initially measured at cost. The cost of an asset comprises its purchase price and any directly attributable costs of bringing the asset to the working condition and location for its intended use. Expenditure incurred after property, plant and equipment have been put into operation, such as repairs and maintenance, is normally expensed in the period in which incurred. Property, plant and equipment are subsequently measured at cost less accumulated depreciation. Property, plant and equipment are depreciated on a straight-line basis, considering any estimated residual value, over the estimated useful lives of the assets. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. The estimated useful lives of the assets are as follows: Estimated useful life Property 20 years Leasehold improvement 5 years Vehicles 5 years Office equipment and furniture 3-5 years |
Intangible Assets | Acquired computer software licenses are capitalized on the basis of the costs incurred to acquire and bring to use the specific software. These costs are amortized over their estimated useful lives of five years. |
Impairment Of Non-financial Assets | At each reporting date, the Company reviews the carrying amounts of its non-financial assets to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that is largely independent of the cash inflows of other assets. The recoverable amount of an asset is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. An impairment loss is recognized if the carrying amount of an asset exceeds its recoverable amount. Impairment losses are recognized in the Consolidated Statement of Profit and Other Comprehensive Income. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized. |
Provisions | A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as finance cost. |
Share-based Payments | In December 2010, the Company established the 2010 Equity Incentive Plan to help recruit and retain key employees, directors or consultants by providing incentives through the granting of equity awards. Under the 2010 Equity Incentive Plan, the Company may issue equity awards in the form of share options, restricted shares, or share appreciation rights. The maximum aggregate number of ordinary shares that may be issued pursuant to all awards is 23,200,000. For the years ended December 31, 2019 and 2020, a total of 269,252 and 1,069,615 ordinary shares were issued to certain directors and a key employee as a share-based compensation, respectively. The Company’s board of directors adopted the 2022 Equity Incentive Plan in July, effective as of July 8, 2022, provide additional incentives to employees, directors and consultants and promote the success of our business. Under the 2022 Equity Incentive Plan, or 2022 Plan, the maximum aggregate number of shares that may be issued pursuant to all awards shall be 384,000,000 ordinary shares. There is no share-based compensation for the years ended December 31, 2021 and 2022. The Company recognizes share-based compensation in relation to awards issued under the 2010 and 2022 Equity Incentive Plan in the Consolidated Statements of Profit and Other Comprehensive Income based on the fair value of the equity awards on the date of the grant, and considering any applicable performance criteria and estimated forfeitures, with compensation expense recognized over the period in which the recipient is required to provide service to the Company in exchange for the equity award. The estimation of share awards that ultimately vest requires judgment, and to the extent actual results differ from estimates, such amounts are recorded as a cumulative adjustment in the period estimates are revised. The Company will consider various factors when estimating expected forfeitures, including historical experience. Actual results may differ substantially from these estimates. The fair value of share options granted to employees and directors under the 2010 and 2022 Equity Incentive Plan is determined using option pricing models, which consider the exercise price relative to the market value of the underlying shares, the expected share price volatility, the risk-free interest rate and the dividend yield, and the estimated period of time option grants are outstanding before they are ultimately exercised. For shares granted to employees, the fair value of the shares is measured as the difference between the market price of the Company’s ordinary shares, adjusted to take into account the terms and conditions upon which the shares were granted (except for vesting conditions that are excluded from the measurement of fair value) and the purchase price of the grant. Adjustments to the market price of the ordinary shares could arise, for example, if the employee is not entitled to receive dividends during the vesting period. |
Social Benefits Contributions | Pursuant to the relevant regulations of the PRC government, the Company’s PRC subsidiaries participate in a local municipal government social benefits plan, and is required to contribute a certain percentage of the basic salaries of its employees to fund their retirement benefits. The local municipal government undertakes to assume the retirement benefits obligations of all existing and future retired employees. The Company’s only obligation is to pay the ongoing required contributions. Contributions are charged to expense as incurred. There are no provisions whereby forfeited contributions may be used to reduce future contributions. Amounts contributed during the years ended December 31, 2020, 2021 and 2022, are discussed in Note 10. |
Value Added Tax ("vat") | Interest income in the PRC are subject to VAT at 6% (output VAT). Input tax on purchases can be deducted from output VAT. The net amount of VAT recoverable from, or payable to, the taxation authority is included as part of other receivables or other payables in the Consolidated Statement of Financial Position. Revenues, expenses and assets are recognized net of VAT except: · where the VAT incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case the VAT is recognized as part of the cost of acquisition of the asset or as part of the expense item as applicable; and · receivables and payables are stated with VAT included. |
Loans Payable | Loans payable represent to loans granted by relevant financial institutions. The Company has utilized these borrowings to provide loan facilities to micro sized enterprises, SMEs, sole proprietors and individuals. |
Convertible notes payable | Convertible notes payable that can be converted into ordinary shares at the option of the holder, where the number of shares to be issued is fixed, are accounted for as compound financial instruments, i.e. they contain both a liability component and an equity component. At initial recognition the liability component of the convertible notes payable is measured at fair value based on the future interest and principal payments, discounted at the prevailing market rate of interest for similar non-convertible instruments. The equity component is the difference between the initial fair value of the convertible notes as a whole and the initial fair value of the liability component. Transaction costs that relate to the issue of a compound financial instrument are allocated to the liability and equity components in proportion to the allocation of proceeds. The liability component is subsequently carried at amortised cost. Interest expense recognised in profit or loss on the liability component is calculated using the effective interest method. The equity component is recognised in the capital reserve until either the bonds are converted or redeemed. If the notes are converted, the capital reserve, together with the carrying amount of the liability component at the time of conversion, is transferred to share capital and share premium as consideration for the shares issued. If the notes are redeemed, the capital reserve is released directly to retained profits. |
Share Capital | The transaction costs of an equity transaction are accounted for as a deduction from equity (net of any related income tax benefit) to the extent they are incremental costs directly attributable to the equity transaction that otherwise would have been avoided. These incremental costs include registration and other regulatory fees, amounts paid to legal, accounting and other professional advisors, printing costs and stamp duties, excluding management salaries, items normally included in general and administrative expenses or other recurring costs. Specifically, legal and accounting fees do not include any fees that would have been incurred in the absence of such issuance. |
Statutory Reserve | In accordance with the relevant regulations and their articles of subsidiaries of the Company incorporated in PRC are required to allocate at least 10% of their after-tax profit determined based on the PRC accounting standards and regulations to the statutory reserve until the reserve has reached 50% of the relevant subsidiary's registered capital. The reserve can only be used for the specific purposes and are not transferable to the Company in the forms of loans, advances or cash dividends. For the years ended December 31, 2021 and 2022, no appropriations to the statutory reserve have been made by the Company. |
General Risk Reserve | General risk reserve is referred to as the reserve fund that is created by keeping aside a part of profit earned by the business during the course of an accounting period for fulfilling various business needs like meeting contingencies, offsetting future losses, enhancing the working capital, etc. For the years ended December 31, 2021 and 2022, no appropriations to the general reserve have been made by the Company. |
Earnings/(loss) Per Shares | The Company presents basic and diluted earnings/(loss) per share (“EPS”) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss that is attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss that is attributable to ordinary shareholders and the weighted-average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares. |
Organization and principal ac_2
Organization and principal activities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization and principal activities | |
Details Of Subsidiaries And Variable Interest Entity | Subsidiary Place of incorporation Particular of issued and fully paid up capital Company’s effective interest Held by the Company Held by a subsidiary Principal activities True Silver Limited British Virgin Islands $ 50,000 100 % 100 % - Investment holding Chutian Financial Holdings (Hong Kong) Limited Hong Kong HK$ 10,000 100 % - 100 % Investment holding Wuhan Chutian Investment Holding Limited. PRC $ 3,000,000 100 % - 100 % Investment holding Variable interest entity Hubei Chutian Microfinance Co., Ltd PRC RMB 450,000,000 80 % - 80 % Microfinance lender |
Schedule Of Accompanying Consolidated Financial | As of December 31, 202 1 202 2 RMB’000 RMB’000 Total current assets 555,478 556,757 Total non-current assets 42,185 39,233 Total assets 597,663 595,990 Total current liabilities 274,213 297,829 Total liabilities 274,213 297,829 For the year ended December 31, 20 20 202 1 202 2 RMB’000 RMB’000 RMB’000 Interest income on loans 105,570 20,627 44,797 Net profit/(loss) 23,128 (125,370 ) (23,947 ) |
Summary of significant accoun_3
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary Of estimated useful lives | Estimated useful life Property 20 years Leasehold improvement 5 years Vehicles 5 years Office equipment and furniture 3-5 years |
Standards issued but not yet _2
Standards issued but not yet effective (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Standards issued but not yet effective | |
Schedule Of Standards Issued | Effective for accounting periods beginning on or after Amendments to IAS 1, Classification of Liabilities as Current or Non-Current January 1, 2023 Amendments to IA S 8 , Definition of Accounting Estimates January 1, 2023 IFRS 17 Insurance Contracts January 1, 2023 Amendments to IAS 1, Presentation of Financial Statements, and IFRS Practice Statement 2, Making Materiality Judgements January 1, 2023 Amendments to IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors January 1, 2023 Amendments to IAS 12, Income Taxes January 1, 2024 Amendments to IAS 16, Leases January 1, 2024 Amendments to IAS 1, Presentation of Financial Statements |
Credit risk (Tables)
Credit risk (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Gross Carrying Amounts Of Loans To Customers | 202 2 ECL staging Stage 1 Stage 2 Stage 3 Lifetime ECL Lifetime ECL Lifetime ECL Total RMB’000 RMB’000 RMB’000 RMB’000 Loans receivable - - 753,043 753,043 Accrued interest - - 443,359 443,359 Gross loans receivable - - 1,196,402 1,196,402 Credit impairment losses - - (640,290 ) (640,290 ) Carrying amount - - 556,112 556,112 202 1 ECL staging Stage 1 Stage 2 Stage 3 Lifetime ECL Lifetime ECL Lifetime ECL Total RMB’000 RMB’000 RMB’000 RMB’000 Loans receivable - - 754,393 754,393 Accrued interest - - 398,610 398,610 Gross loans receivable - - 1,153,003 1,153,003 Credit impairment losses - - (597,870 ) (597,870 ) Carrying amount - - 555,133 555,133 |
Market risk (Tables)
Market risk (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Assets And Liabilities Subject To Market Risk | As of December 31, 202 1 202 2 RMB’000 RMB’000 Assets subject to market risk Loans receivable 555,133 556,112 Liabilities subject to market risk Loan payable 161,569 161,439 Convertible notes payable - 7,264 |
Fair value of financial asset_2
Fair value of financial assets and liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair value of financial assets and liabilities | |
Schedule Of Fair Value Of Financial Assets And Liabilities | As of December 31, 202 2 Fair value Carrying Amount RMB’000 RMB’000 Financial assets Cash, cash equivalents and restricted cash 295 295 Loans receivable 556,112 556,112 556,407 556,407 Financial liabilities Loans payable 161,439 161,439 Convertible notes payable 7,264 7,264 168,703 168,703 As of December 31, 202 1 Fair value Carrying amount RMB’000 RMB’000 Financial assets Cash, cash equivalents and restricted cash 396 396 Loans receivable 555,133 555,133 555,529 555,529 Financial liabilities Loans payable 161,569 161,569 |
Profit(loss) before income ta_2
Profit(loss) before income taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Profit Before Taxation | Year Ended December 31, 20 20 202 1 202 2 RMB’000 RMB’000 RMB’000 Depreciation of property, plant and equipment 2,977 2,973 2,952 Amortization of intangible asset 1 1 *- Directors - salaries and related costs 1,051 602 816 - social benefits contribution 5 11 24 - share based compensation 37 - - Key management personnel (other than directors) - salaries and related costs 1,563 1,380 1,212 - social benefits contribution 5 11 - - share based compensation 74 - - Other than directors and key management personnel - salaries and related costs 707 578 689 - social benefits contribution 10 44 36 |
Income tax expense (Tables)
Income tax expense (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income tax expense | |
Schedule Of Reconciliation Of Income Taxes | Year Ended December 31, 20 20 202 1 202 2 RMB’000 RMB’000 RMB’000 Profit/(loss) before income taxes 19,854 (128,072 ) (30,344 ) Computed expected income tax expense 4,963 (32,018 ) (7,586 ) Tax effect of non-deductible expenses 13,817 33,058 7,573 Tax effect of tax-exempt entities 804 604 (1,503 ) Tax effect of non-taxable income (19,584 ) (1,644 ) 1,516 Income tax expense - - - |
Earnings(loss) per share (Table
Earnings(loss) per share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings(loss) per share | |
Schedule Of Basic And Diluted Earnings/(loss) Per Share | 20 20 RMB’000 202 1 RMB’000 202 2 RMB’000 Net profit/(loss) attributable to the equity holders of the Company - numerator for basic and diluted earnings/(loss) per share 15,883 (102,458 ) (24,275 ) Number of shares in thousands Weighted average share outstanding - denominator for basic and diluted earnings/(loss) per share 1,001,575 1,002,201 1,003,304 Basic and diluted earnings/(loss) per share 0.02 (0.10 ) (0.02 ) |
Cash cash equivalents and res_2
Cash cash equivalents and restricted cash (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Cash And Cash Equivalent | As of December 31, 202 1 202 2 RMB’000 RMB’000 Cash on hand 40 41 Cash at bank 310 87 Restricted cash at bank (1) 46 167 Cash, cash equivalents and restricted cash per consolidated statements of cash flow 396 295 |
Loans receivables net of credit
Loans receivables net of credit impairment losses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Loans Receivables | As of December 31, 202 1 202 2 RMB’000 RMB’000 Loans receivable at amortized cost 754,393 753,043 Accrued interest 398,610 443,359 Gross loans receivable 1,153,003 1,196,402 Less: Credit impairment losses (597,870 ) (640,290 ) Loans receivable, net of credit impairment losses 555,133 556,112 |
Schedule Of Changes In Credit Impairment Losses Of Loans Receivable | As of December 31, 202 1 202 2 RMB’000 RMB’000 Credit impairment losses as at January 1 478,792 597,870 Charge to statement of profit and other comprehensive income 119,078 42,420 Credit impairment losses as of December 31 597,870 640,290 |
Prepaid expenses (Tables)
Prepaid expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Prepaid expenses | |
Schedule Of Prepaid Expenses | As of December 31, 202 1 202 2 RMB’000 RMB’000 Prepaid expenses 848 4,629 |
Property, plant and equipment (
Property, plant and equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Property, plant and equipment | Property Motor vehicle Office equipment & furniture Leasehold improvements Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Cost At December 31, 2020, 2021 and 2022 48,140 579 1,078 3,923 53,720 Accumulated depreciation At December 31, 2020 5,042 550 665 2,310 8,567 Depreciation 2,285 - 135 553 2,973 At December 31, 2021 7,327 550 800 2,863 11,540 Depreciation 2,286 - 113 553 2,952 At December 31, 2022 9,613 550 913 3,416 14,492 Carrying amount At December 31, 2021 40,813 29 278 1,060 42,180 At December 31, 2022 38,527 29 165 507 39,228 |
Intangible asset (Tables)
Intangible asset (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Intangible Asset | Acquired computer software RMB’000 Cost At December 31, 2020, 2021 and 2022 9 Accumulated amortization At December 31, 2020 3 Amortization 1 At December 31, 2021 4 Amortization *- At December 31, 2022 4 Carrying amount At December 31, 2021 5 At December 31, 2022 5 |
Loans payable (Tables)
Loans payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule Of Loans Payble | As of December 31, 202 1 202 2 RMB’000 RMB’000 Loans payable to third parties 140,558 140,558 Loans payable to related parties (1) 1,011 881 Loans payable to shareholders (2) 20,000 20,000 Total 161,569 161,439 |
Convertible notes payable (Tabl
Convertible notes payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Convertible notes payable | |
Schedule Of Convertible notes payable | As of December 31, 2021 2022 RMB’000 RMB’000 Liability component on initial recognition - 7,415 Interest accrued - 360 Notes converted to ADS - (517 ) Exchange difference - 6 Total - 7,264 |
Salary and benefit payable (Tab
Salary and benefit payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Salary and benefit payable | |
Schedule Of Salary And Benefit Payable | As of December 31, 202 1 202 2 RMB’000 RMB’000 Salary and benefit payable to employees 7,808 9,599 Consulting expenses payable to a shareholder’s representatives (1) 2,064 2,580 Total 9,872 12,179 |
Interest payable (Tables)
Interest payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Interest payable | |
Schedule Of Interest Payable | As of December 31, 202 1 202 2 RMB’000 RMB’000 Interest payable to third parties 41,138 54,765 Interest payable to related parties (1) 1,701 1,819 Interest payable to shareholders (2) 11,846 16,226 Total 54,685 72,810 |
Other payable (Tables)
Other payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other payable | |
Schedule Of Other Payable | As of December 31, 202 1 202 2 RMB’000 RMB’000 Other payable to related parties (1) 10,025 13,347 Accrued expenses 8,820 9,384 Other taxes payable (2) 2,811 3,211 Total 21,656 25,942 |
Share capital and additional _2
Share capital and additional paidin capital (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share capital and additional paid-in capital | |
Disclosure Of Issued Share Capital And Additional Paid-in Capital | Number of shares Ordinary shares Additional paid-in capital Total Non- controlling interest Total equity (thousands) RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 At January 1, 2020 1,001,131 326 383,174 383,500 95,875 479,375 Shares issued during the year 1,070 *- - - *- *- At December 31, 2020 1,002,201 326 383,174 383,500 95,875 479,375 Shares issued during the year - - - - - - At December 31, 2021 1,002,201 326 383,174 383,500 95,875 479,375 Shares issued during the year 40,257 14 510 524 - 524 At December 31, 2022 1,042,458 340 383,684 384,024 95,875 479,899 |
Organization and principal ac_3
Organization and principal activities (Details) | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2022 HKD ($) | |
Wuhan Chutian Investment Holdings Co. Ltd [Member] | ||
Statement [Line Items] | ||
Issued And Fully Paid Up Capital | $ 3,000,000 | |
Group's Effective Interest | 100% | 100% |
Principal Activities | Investment holding | |
Held By A Subsidiary | 100% | 100% |
True Silver Limited [Member] | ||
Statement [Line Items] | ||
Issued And Fully Paid Up Capital | $ 50,000 | |
Group's Effective Interest | 100% | 100% |
Held By Company | 100% | 100% |
Chutian Financial Holdings (Hong Kong) Limited [Member] | ||
Statement [Line Items] | ||
Issued And Fully Paid Up Capital | $ 10,000 | |
Group's Effective Interest | 100% | 100% |
Principal Activities | Investment holding | |
Held By A Subsidiary | 100% | 100% |
Variable interest entity Hubei Chutian Microfinance Co., Ltd [Member] | ||
Statement [Line Items] | ||
Issued And Fully Paid Up Capital | $ 450,000,000 | |
Group's Effective Interest | 80% | 80% |
Principal Activities | Microfinance lender | |
Held By A Subsidiary | 80% | 80% |
Organization and principal ac_4
Organization and principal activities (Details 1) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Statement [Line Items] | ||
Total Current Assets | ¥ 561,036 | ¥ 556,377 |
Total Non-current Assets | 39,233 | 42,185 |
Total Assets | 600,269 | 598,562 |
Total Current Liabilities | 312,111 | 280,259 |
VIEs [Member] | ||
Statement [Line Items] | ||
Total Current Assets | 556,757 | 555,478 |
Total Non-current Assets | 39,233 | 42,185 |
Total Assets | 595,990 | 597,663 |
Total Current Liabilities | 297,829 | 274,213 |
Total Liabilities | ¥ 297,829 | ¥ 274,213 |
Organization and principal ac_5
Organization and principal activities (Details 2) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement [Line Items] | |||
Interest Income On Loans | ¥ (44,797,000) | ¥ (20,627,000) | ¥ (105,570,000) |
VIEs [Member] | |||
Statement [Line Items] | |||
Interest Income On Loans | 44,797 | 20,627,000 | 105,570,000 |
Net Profit | ¥ (23,947,000) | ¥ (125,370,000) | ¥ 23,128,000 |
Organization and principal ac_6
Organization and principal activities (Details Narrative) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Dec. 28, 2017 CNY (¥) shares | Dec. 31, 2022 CNY (¥) shares | Dec. 31, 2022 $ / shares | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 | May 31, 2018 CNY (¥) | Dec. 28, 2017 USD ($) $ / shares | |
Statement [Line Items] | |||||||
Registered Share Capital | ¥ 5,000,000 | $ 450 | |||||
Voting Interest | 27.30% | ||||||
VIEs [Member] | |||||||
Statement [Line Items] | |||||||
Interest Income On Loan Rate | 100% | 100% | 100% | ||||
Total Assets Percentage | 99.30% | 100% | |||||
Total Liabilities Percentage | 94.50% | 98.80% | |||||
Exclusive Purchase Option Agreement [Member] | |||||||
Statement [Line Items] | |||||||
Shareholders Holding Description | Shareholders holding 80% Equity Interests of Chutian | ||||||
Shareholders Voting Proxy Agreement [Member] | |||||||
Statement [Line Items] | |||||||
Shareholders Holding Description | Chutian as the voting proxy of the Shareholders holding 80% Equity Interests of Chutian | ||||||
Share Pledge Agreement [Member] | |||||||
Statement [Line Items] | |||||||
Shareholders Holding Description | holding 80% equity interests of Chutian pledged all of their equity interests in Chutian to Chutian Holding to guarantee the performance of Chutian’s obligations under the Exclusive Consigned Management Agreement, Shareholders Voting Proxy Agreement and Exclusive Purchase Option Agreement (the “Main Agreements”) | ||||||
Ordinary Shares [Member] | March 1, 2018 [Member] | |||||||
Statement [Line Items] | |||||||
Share Price | $ / shares | $ 0.005 | ||||||
True Silver Limited [Member] | |||||||
Statement [Line Items] | |||||||
Registered Capital | ¥ 50,000 | ||||||
Paid-up Share Capital | ¥ 50,000 | ||||||
Date Of Incorporation | Jun. 28, 2016 | ||||||
Business Acquisition Consideration Paid In Cash | ¥ 228,000,000 | ||||||
Ordinary Shares Capital | shares | 50,000 | ||||||
True Silver Limited [Member] | Ordinary Stock Shares [Member] | |||||||
Statement [Line Items] | |||||||
Share Price | $ / shares | $ 1 | ||||||
Business Acquisition Consideration Paid, Shares Issued | shares | 772,283,308 | ||||||
Chutian Financial Holdings (Hong Kong) Limited [Member] | |||||||
Statement [Line Items] | |||||||
Paid-up Share Capital | ¥ 10,000 | ||||||
Date Of Incorporation | Aug. 12, 2016 | ||||||
Ordinary Shares Capital | shares | 100 | ||||||
Variable interest entity Hubei Chutian Microfinance Co., Ltd [Member] | |||||||
Statement [Line Items] | |||||||
Registered Capital | ¥ 450,000,000 | ¥ 450,000,000 | |||||
Variable Interest Entity, Ownership Percentage Hold By True Silver | 80% | 80% | |||||
Ownership Interest Held By The Former Shareholders | 88.70% | ||||||
Xiniya Holdings Limited [Member] | |||||||
Statement [Line Items] | |||||||
Divestiture Of Business, Consideration Receivable In Cash | ¥ 228,000,000 | ||||||
Hubei Chutian Microfinance Co., Ltd [Member] | VIE Agreements [Member] | |||||||
Statement [Line Items] | |||||||
Contractual Agreements Description | Chutian Holding is deemed to control 80% of Chutian and have rights to consolidate 80% of Chutian’s financial results. | ||||||
Chutian and Chutian Holding [Member] | Management Service Agreement [Member] | |||||||
Statement [Line Items] | |||||||
Exclusive Consigned Management Service Agreement | Chutian Holding is entitled to collect a service fee equal to 80% of the net operating income of Chutian (the “Service Fees”). The Service Fees are due and payable on a quarterly basis; provided, however, in principle, the payment of the Service Fees should not cause any difficulty to the operation of either party to this Agreement. |
Summary of significant accoun_4
Summary of significant accounting policies (Details) | Dec. 31, 2022 USD ($) |
Property [Member] | |
Statement [Line Items] | |
Estimated Useful Life | $ 20 |
Leasehold improvements [Member] | |
Statement [Line Items] | |
Estimated Useful Life | 5 |
Vehicles [Member] | |
Statement [Line Items] | |
Estimated Useful Life | 5 |
Office equipment and furniture [Member] | Minimum [Member] | |
Statement [Line Items] | |
Estimated Useful Life | 3 |
Office equipment and furniture [Member] | Maximum [Member] | |
Statement [Line Items] | |
Estimated Useful Life | $ 5 |
Summary of significant accoun_5
Summary of significant accounting policies (Details Narrative) - CNY (¥) ¥ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2020 | Dec. 31, 2010 | |
Statement [Line Items] | |||
Net Loss | ¥ (30.3) | ||
Receivables Allowance | ¥ 42.4 | ||
Intangible Assets Estimated Useful Life | 12 months | ||
Ownership Percentage Description | financial support letter from Hubei New Nature Investment Co., Ltd, a company that is 80.8% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, and from Dunxin Holdings Co., Ltd, a company that is 70% owned by the former Chairman and the Chief Executive Officer, Mr. Wei, which have expressed the willingness and intention to provide the necessary financial support to the Company | ||
Common Stock, Shares Issued | 40,257,168 | ||
PRC [Member] | |||
Statement [Line Items] | |||
Interest And Fee Income | 6% | ||
Equity Incentive Plan [member] | |||
Statement [Line Items] | |||
Common Stock, Shares Issued | 269,252 | 1,069,615 | 23,200,000 |
Ordinary shares | 384,000,000 |
Credit risk (Details)
Credit risk (Details) - CNY (¥) | Dec. 31, 2022 | Dec. 31, 2021 |
Statement [Line Items] | ||
Loan Receivables | ¥ 753,043,000 | ¥ 754,393,000 |
Accrued Interest | 443,359,000 | 398,610,000 |
Gross Loan Receivables | 1,196,402,000 | 1,153,003,000 |
Credit Impairment Losses | (640,290,000) | (597,870,000) |
Carrying Amount | 556,112 | 555,133,000 |
Stage 1 [Member] | ||
Statement [Line Items] | ||
Loan Receivables | 0 | 0 |
Accrued Interest | 0 | 0 |
Gross Loan Receivables | 0 | 0 |
Credit Impairment Losses | 0 | 0 |
Carrying Amount | 0 | 0 |
Stage 2 [Member] | ||
Statement [Line Items] | ||
Loan Receivables | 0 | 0 |
Accrued Interest | 0 | 0 |
Gross Loan Receivables | 0 | 0 |
Credit Impairment Losses | 0 | 0 |
Carrying Amount | 0 | 0 |
Stage 3 [Member] | ||
Statement [Line Items] | ||
Loan Receivables | 753,043,000 | 754,393,000 |
Accrued Interest | 443,359,000 | 398,610,000 |
Gross Loan Receivables | 1,196,402,000 | 1,153,003,000 |
Credit Impairment Losses | (640,290,000) | (597,870,000) |
Carrying Amount | ¥ 556,112,000 | ¥ 555,133,000 |
Market risk (Details)
Market risk (Details) - CNY (¥) | Dec. 31, 2022 | Dec. 31, 2021 |
Statement [Line Items] | ||
Convertible notes payable | ¥ 7,264,000 | ¥ 0 |
Loan Receivables | 753,043,000 | 754,393,000 |
Market risk [member] | ||
Statement [Line Items] | ||
Loan Receivables | 556,112,000 | 555,133,000 |
Loan Payable | ¥ 161,439 | ¥ 161,569,000 |
Capital risk (Details Narrative
Capital risk (Details Narrative) | 12 Months Ended |
Dec. 31, 2022 CNY (¥) | |
Statement [Line Items] | |
Capital Of Variable Interest Entity | ¥ 450 |
Hubei Province [Member] | |
Statement [Line Items] | |
Capital Requirement, Description | 50 |
Fair value of financial asset_3
Fair value of financial assets and liabilities (Details) - CNY (¥) | Dec. 31, 2022 | Dec. 31, 2021 |
Statement [Line Items] | ||
Convertible notes payable | ¥ 7,264,000 | ¥ 0 |
Loan Receivables | 753,043,000 | 754,393,000 |
Fair value [Member] | ||
Statement [Line Items] | ||
Convertible notes payable | 7,264,000 | |
Cash, Cash Equivalents And Restricted Cash | 295,000 | 396,000 |
Loan Receivables | 556,112,000 | 555,133,000 |
Total Financial Assets | 556,407,000 | 555,529,000 |
Total Financial Liabilities | 168,703,000 | |
Loans Payable | 161,439,000 | 161,569,000 |
Carrying amount [member] | ||
Statement [Line Items] | ||
Convertible notes payable | 7,264,000 | |
Cash, Cash Equivalents And Restricted Cash | 295,000 | 396,000 |
Loan Receivables | 556,112 | 555,133,000 |
Total Financial Assets | 556,407,000 | 555,529,000 |
Total Financial Liabilities | 168,703,000 | |
Loans Payable | ¥ 161,439,000 | ¥ 161,569,000 |
Profit(loss) before income ta_3
Profit(loss) before income taxes (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Depreciation Of Property And Equipment | ¥ 2,952,000 | ¥ 2,973,000 | ¥ 2,977,000 |
Amortization Of Intangible Asset | 0 | 1,000 | 1,000 |
Directors | |||
Salaries And Related Costs | 816,000 | 602,000 | 1,051,000 |
Social Benefits Contribution | 24,000 | 11,000 | 5,000 |
Share Based Compensation | 0 | 0 | 37,000 |
Key Management Personnel (other Than Directors) | |||
Salaries And Related Costs | 1,212,000 | 1,380,000 | 1,563,000 |
Social Benefits Contribution | 0 | 11,000 | 5,000 |
Share Based Compensation | 0 | 0 | 74,000 |
Other Than Directors And Key Management Personnel | |||
Salaries And Related Costs | 689,000 | 578,000 | 707,000 |
Social Benefits Contribution | ¥ 36,000 | ¥ 44,000 | ¥ 10,000 |
Income tax expense (Details)
Income tax expense (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement [Line Items] | |||
Profit/(loss) Before Income Taxes | ¥ (30,344,000) | ¥ (128,072,000) | ¥ 19,854,000 |
Income Taxes [member] | |||
Statement [Line Items] | |||
Profit/(loss) Before Income Taxes | (30,344) | (128,072,000) | 19,854,000 |
Computed Expected Income Tax Expense | (7,586,000) | (32,018,000) | 4,963,000 |
Tax Effect Of Non-deductible Expenses | 7,573,000 | 33,058,000 | 13,817,000 |
Tax Effect Of Tax-exempt Entities | (1,503,000) | 604,000 | 804,000 |
Tax Effect Of Non-taxable Income | 1,516,000 | (1,644,000) | (19,584,000) |
Income Tax Expense | ¥ 0 | ¥ 0 | ¥ 0 |
Income tax expense (Details Nar
Income tax expense (Details Narrative) | 12 Months Ended |
Dec. 31, 2022 | |
Income tax expense | |
Reconciliation Tax Rates | 25% |
Earnings(loss) per share (Detai
Earnings(loss) per share (Details) - CNY (¥) ¥ / shares in Units, ¥ in Thousands, shares in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings(loss) per share | |||
Net Profit/(loss) Attributable To The Equity Holders Of The Company - Numerator For Basic And Diluted Earnings/(loss) Per Share | ¥ (24,275) | ¥ (102,458) | ¥ 15,883 |
Weighted Average Share Outstanding - Denominator For Basic And Diluted Earnings/(loss) Per Share | 1,003,304 | 1,002,201 | 1,001,575 |
Basic And Diluted Earnings/(loss) Per Share | ¥ (0.02) | ¥ (0.10) | ¥ 0.02 |
Earnings(loss) per share (Det_2
Earnings(loss) per share (Details Narrative) - $ / shares shares in Thousands | 12 Months Ended | |||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 28, 2017 | Dec. 18, 2014 | Dec. 17, 2014 | |
Statement [Line Items] | ||||||
Weighted Average Number Of Shares Outstanding In The Year | 1,003,303,952 | 1,002,201,016 | 1,001,575,455 | |||
American Depository Share [member] | ||||||
Statement [Line Items] | ||||||
Common Stock, Recevable Shares | 48 | 16 | 4 | |||
Common Stock, Par Value | $ 0.00005 |
Cash cash equivalents and res_3
Cash cash equivalents and restricted cash (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Cash On Hand | ¥ 41 | ¥ 40 |
Cash At Bank | 87 | 310 |
Restricted Cash At Bank(1) | 167 | 46 |
Cash, Cash Equivalents And Restricted Cash Per Consolidated Statements Of Cash Flow | ¥ 295 | ¥ 396 |
Loans receivable net of credi_2
Loans receivable net of credit impairment losses (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Loans Receivable At Amortized Cost | ¥ 753,043 | ¥ 754,393 |
Accrued Interest | 443,359 | 398,610 |
Gross Loans Receivable | 1,196,402 | 1,153,003 |
Less: Credit Impairment Losses | (640,290) | (597,870) |
Loans Receivable, Net Of Credit Impairment Losses | ¥ 556,112 | ¥ 555,133 |
Loans receivable net of credi_3
Loans receivable net of credit impairment losses (Details 1) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Credit Impairment Losses As At January 1 | ¥ 597,870 | ¥ 478,792 |
Charge to statement of profit and other comprehensive income | 42,420 | 119,078 |
Credit Impairment Losses As At December 31 | ¥ 640,290 | ¥ 597,870 |
Loans receivable net of credi_4
Loans receivable net of credit impairment losses (Details Narrative) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Loans Receivable Secured, Interest Range | 1.25% to 3.30% | 1.25% to 3.30% |
Prepaid expenses and others (De
Prepaid expenses and others (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Prepaid Expenses | ¥ 4,629 | ¥ 848 |
Property, plant and equipment_2
Property, plant and equipment (Details) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement [Line Items] | ||
Beginning Balance | ¥ 53,720,000 | |
Depreciation | ¥ 2,952,000 | 2,973,000 |
Ending Balance | 53,720,000 | |
Carrying Amount Of Assets | 39,228,000 | 42,180,000 |
Balance At The Beginning | 8,567,000 | |
Balance At The End | 14,492,000 | 11,540,000 |
Property [Member] | ||
Statement [Line Items] | ||
Beginning Balance | 48,140,000 | |
Depreciation | 2,286,000 | 2,285 |
Ending Balance | 48,140,000 | |
Carrying Amount Of Assets | 38,527,000 | 40,813,000 |
Balance At The Beginning | 5,042,000 | |
Balance At The End | 9,613,000 | 7,327,000 |
Leasehold improvements [Member] | ||
Statement [Line Items] | ||
Beginning Balance | 3,923,000 | |
Depreciation | 553,000 | 553,000 |
Ending Balance | 2,863,000 | |
Carrying Amount Of Assets | 507,000 | 1,060,000 |
Balance At The Beginning | 2,310,000 | |
Balance At The End | 3,416,000 | 2,310,000 |
Office equipment & furniture [Member] | ||
Statement [Line Items] | ||
Beginning Balance | 1,078,000 | |
Depreciation | 113,000 | 135,000 |
Ending Balance | 1,078,000 | |
Carrying Amount Of Assets | 165,000 | 278,000 |
Balance At The Beginning | 665,000 | |
Balance At The End | 913,000 | 800,000 |
Motor vehicles [member] | ||
Statement [Line Items] | ||
Beginning Balance | 579,000 | |
Depreciation | 0 | 0 |
Ending Balance | 579,000 | |
Carrying Amount Of Assets | 29,000 | 29,000 |
Balance At The Beginning | 550,000 | |
Balance At The End | ¥ 550,000 | ¥ 550,000 |
Intangible asset (Details)
Intangible asset (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cost | |||
Ending Balance | ¥ 9,000 | ¥ 9,000 | ¥ 9,000 |
Accumulated Amortization | |||
Amortization | 0 | 1,000 | |
Ending Balance | 4,000 | 4,000 | ¥ 3,000 |
Carrying Amount | ¥ 5,000 | ¥ 5,000 |
Loans payable (Details)
Loans payable (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Statement [Line Items] | ||
Loans Payable | ¥ 161,439 | ¥ 161,569 |
Third parties [Member] | ||
Statement [Line Items] | ||
Loans Payable | 140,558 | 140,558 |
Shareholders [Member] | ||
Statement [Line Items] | ||
Loans Payable | 20,000 | 20,000 |
Related parties [Member] | ||
Statement [Line Items] | ||
Loans Payable | ¥ 881 | ¥ 1,011 |
Loans payable (Details Narrativ
Loans payable (Details Narrative) | Dec. 31, 2022 | Dec. 31, 2021 |
Average Annual Interest Rates | 12.70% | 12.70% |
Convertible notes payable (Deta
Convertible notes payable (Details) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2021 USD ($) |
Convertible notes payable | |||
Liability component on initial recognition | ¥ 0 | $ 7,415 | |
Interest accrued | 0 | ¥ 360 | |
Notes converted to ADS | 0 | (517) | |
Exchange difference | 0 | 6 | |
Total | ¥ 0 | ¥ 7,264 |
Convertible notes payable (De_2
Convertible notes payable (Details Narrative) - USD ($) | 1 Months Ended | |
May 24, 2022 | Dec. 31, 2022 | |
Convertible notes payable | ||
Maturity of issued unsecured convertible promissory note | 18 months | |
Principal amount of notes payable | $ 1,075,000 | |
Consideration amount | 1,000,000 | |
Original issue discount | 50,000 | |
Investor legal fee | $ 25,000 | |
Interest rate on notes | 8% | |
Common stock share issued | 40,257,168 | |
Principal amount of issued share | $ 75,000 | |
Notes balance | $ 1,053,244 |
Salary and benefit payable (Det
Salary and benefit payable (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Salary and benefit payable | ||
Salary And Benefit Payable To Employees | ¥ 9,599 | ¥ 7,808 |
Consulting Expenses Payable To A Shareholder's Representatives(1) | 2,580 | 2,064 |
Total | ¥ 12,179 | ¥ 9,872 |
Income taxes payable (Details N
Income taxes payable (Details Narrative) ¥ in Millions | Dec. 31, 2022 CNY (¥) |
Income taxes payable | |
Corporate Income Tax | ¥ 32.5 |
Interest payable (Details)
Interest payable (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Statement [Line Items] | ||
Interest Payable | ¥ 72,810 | ¥ 54,685 |
Third parties [Member] | ||
Statement [Line Items] | ||
Interest Payable | 54,765 | 41,138 |
Shareholders [Member] | ||
Statement [Line Items] | ||
Interest Payable | 16,226 | 11,846 |
Related parties [Member] | ||
Statement [Line Items] | ||
Interest Payable | ¥ 1,819 | ¥ 1,701 |
Other payable (Details)
Other payable (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other payable | ||
Other Payable To Related Parties | ¥ 13,347 | ¥ 10,025 |
Accrued Expenses | 9,384 | 8,820 |
Other Taxes Payable | 3,211 | 2,811 |
Total | ¥ 25,942 | ¥ 21,656 |
Share capital and additional _3
Share capital and additional paidin capital (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement [Line Items] | |||
Beginning Balance, Amount | ¥ 479,375,000 | ¥ 479,375,000 | ¥ 479,375,000 |
Shares Issued During The Year, Amount | 524,000 | 0 | 0 |
Ending Balance, Amount | 479,899,000 | 479,375,000 | 479,375,000 |
Total Equity [member] | |||
Statement [Line Items] | |||
Beginning Balance, Amount | 383,500,000 | 383,500,000 | 383,500,000 |
Shares Issued During The Year, Amount | 524,000 | 0 | 0 |
Ending Balance, Amount | 384,024,000 | 383,500,000 | 383,500,000 |
Noncontrolling Interest | |||
Statement [Line Items] | |||
Beginning Balance, Amount | 95,875,000 | 95,875,000 | 95,875,000 |
Shares Issued During The Year, Amount | 0 | 0 | 0 |
Ending Balance, Amount | 95,875,000 | 95,875,000 | 95,875,000 |
Additional paid-in capital | |||
Statement [Line Items] | |||
Beginning Balance, Amount | 383,174,000 | 383,174,000 | 383,174,000 |
Shares Issued During The Year, Amount | 510,000 | 0 | 0 |
Ending Balance, Amount | 383,684,000 | 383,174,000 | 383,174,000 |
Ordinary Stock Shares [Member] | |||
Statement [Line Items] | |||
Beginning Balance, Amount | 326,000 | 326,000 | 326,000 |
Shares Issued During The Year, Amount | 14,000 | 0 | 0 |
Ending Balance, Amount | ¥ 340,000 | ¥ 326,000 | ¥ 326,000 |
Number of shares [Member] | |||
Statement [Line Items] | |||
Beginning Balance, Shares | 1,002,201 | 1,002,201 | 1,001,131 |
Shares Issued During The Year, Shares | 40,257 | 1,070 | |
Ending Balance, Shares | 1,042,458 | 1,002,201 | 1,002,201 |
Share capital and additional _4
Share capital and additional paidin capital (Details Narrative) | 12 Months Ended | ||
Dec. 31, 2022 CNY (¥) $ / shares shares | Dec. 31, 2022 CNY (¥) shares | Jun. 30, 2010 shares | |
Statement [Line Items] | |||
Common Stock, Shares Issued | shares | 20,000 | ||
Common Stock, Par Value | $ / shares | $ 0.00005 | ||
March 1, 2018 [Member] | Ordinary Shares [Member] | |||
Statement [Line Items] | |||
Common Stock, Shares Issued | shares | 2,000,000,000 | 2,000,000,000 | |
Common Stock, Par Value | $ / shares | $ 0.00005 | ||
Dividend | ¥ | ¥ 100,000 | ||
Ordinary Shares Two [Member] | March 1, 2018 [Member] | |||
Statement [Line Items] | |||
Common Stock, Shares Issued | shares | 1,000,000,000 | 1,000,000,000 | |
Common Stock, Par Value | $ / shares | $ 0.00005 | ||
Common Stock, Increased Value | ¥ | $ 50,000 | ¥ 50,000 | |
Ordinary Shares One [Member] | March 1, 2018 [Member] | |||
Statement [Line Items] | |||
Common Stock, Shares Issued | shares | 1,000,000,000 | 1,000,000,000 | |
Common Stock, Par Value | $ / shares | $ 0.00005 |
Statutory reserve (Details Narr
Statutory reserve (Details Narrative) - PRC [Member] - CNY (¥) ¥ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Statement [Line Items] | ||
Profits After Taxation, Percentage | 10% | |
Total Statutory Reserve | ¥ 18.7 | ¥ 18.7 |
Variable Interest Entity | 50% | |
Reserve Balance | 50% |
General risk reserve (Details N
General risk reserve (Details Narrative) - PRC 1 [member] - CNY (¥) ¥ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement [Line Items] | ||
General Risk Reserve Description | In accordance with the relevant laws and regulations of the PRC, the Company’s variable interest entity is required to maintain a general risk reserve within the equity, through appropriation of profit, which should not be less than 1.5% of the year end balance of its risk assets over the course of five years | |
Total Statutory Reserve | ¥ 9.2 | ¥ 9.2 |
Related party transactions (Det
Related party transactions (Details Narrative) | 12 Months Ended | |||||||||||
Oct. 09, 2019 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | Dec. 31, 2019 CNY (¥) | Dec. 31, 2018 CNY (¥) | Dec. 31, 2017 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 04, 2019 CNY (¥) | Oct. 14, 2019 CNY (¥) | Jun. 30, 2017 CNY (¥) | Dec. 31, 2016 CNY (¥) | |
Statement [Line Items] | ||||||||||||
Interest Expenses | ¥ 21,701,000 | ¥ 21,826,000 | ¥ 22,213,000 | |||||||||
Loans Payable | 161,439,000 | 161,569,000 | ||||||||||
Loan Receivables | 753,043,000 | 754,393,000 | ||||||||||
Debt Transferred | ¥ 1,400 | |||||||||||
Deposited In Bank Accounts | ¥ 9,000,000 | |||||||||||
Loan Extension Agreement [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Borrowed Amount | ¥ 10,000 | |||||||||||
Borrowings Interest Rate, Percentage | 15% | |||||||||||
Penalty Interest Rate | 9% | |||||||||||
Loan Extension Agreement September 2019 [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Borrowings Interest Rate, Percentage | 15% | |||||||||||
Penalty Interest Rate | 9% | |||||||||||
Chutian And Mr Wei [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Loans Payable To Related Parties | ¥ 10,000 | $ 10,000 | ||||||||||
Interest Expense | ¥ 787,500,000 | 2,000 | 2,000 | |||||||||
Repay Borrowings Principal Amount | ¥ 10,000 | ¥ 10,000 | ||||||||||
Interest Payable | 7,300 | 5,300 | ||||||||||
Chief Executive Officer [Member] | In 2018 [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Interest Payable To Related Parties | 1,800 | 1,700 | ||||||||||
Borrowed Amount | ¥ 17,300 | ¥ 20,000 | ||||||||||
Ownership Interest, Percentage | 80.80% | |||||||||||
Borrowings Interest Rate, Percentage | 12% | |||||||||||
Repayments Of Loan Payable | 130,000,000 | 10,000 | 14,700 | ¥ 500 | ||||||||
Interest Expenses | 118,000,000 | 700 | 1,400 | |||||||||
Interest Payable | 500 | |||||||||||
Offset Against Loan Payable | ¥ 1,700 | 9,900 | ||||||||||
Loans Payable | 900 | 1,000 | 3,100 | |||||||||
Wang Hailin [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Loans Payable To Related Parties | 10,000 | 10,000 | ||||||||||
Interest Payable To Related Parties | ¥ 9,000 | ¥ 6,600 | ||||||||||
Borrowed Amount | ¥ 10,000 | |||||||||||
Borrowings Interest Rate, Percentage | 10% | |||||||||||
Variable Interest Entity | 7.70% | |||||||||||
Hubei Daily Media Group [Member] | Lease commitment [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Variable Interest Entity | 20% | 20% | 20% | 20% | ||||||||
Consulting Expenses | ¥ 500 | ¥ 500 | ¥ 500 | |||||||||
Consulting Expenses Payable | ¥ 2,500 | 2,000 | ||||||||||
Hubei New Nature Investment Co [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Offset Against Loan Payable | 1,700 | 22,600 | ||||||||||
Loans Payable | ¥ 700 | |||||||||||
Variable Interest Entity | 80.80% | 80.80% | 80.80% | |||||||||
Payable To Related Party | ¥ 10,500 | ¥ 8,100 | ||||||||||
Loan Receivables | 1,300 | |||||||||||
Operating Expenses | 2,800 | 700 | ||||||||||
Guarantee Expenses | 2,800 | 2,800 | ||||||||||
Debt Repaymnet Amount | 484,000,000 | |||||||||||
Paid Reverse Merger Expenses On Behalf | ¥ 10,900 | ¥ 11,300 | ||||||||||
Offset Against Interest Payable | ¥ 500 | |||||||||||
Debt Transferred | 700 | |||||||||||
Hubei Baoli Ecological Conservation [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Variable Interest Entity | 4.30% | |||||||||||
Loan Receivables | ¥ 8,000 | |||||||||||
Interest Income Rate | 36% | |||||||||||
Kang Chen [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Variable Interest Entity | 4.30% | |||||||||||
Loan Receivables | ¥ 3,000 | |||||||||||
Interest Income Rate | 36% | |||||||||||
Li Ling [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Borrowed Amount | ¥ 10,000 | |||||||||||
Borrowings Interest Rate, Percentage | 12% | |||||||||||
Repayments Of Loan Payable | ¥ 3,000 | |||||||||||
Interest Expenses | ¥ 29,000,000 | |||||||||||
Variable Interest Entity | 2.50% | |||||||||||
Deposited In Bank Accounts | ¥ 12,000 | |||||||||||
Loan Payable | ¥ 3,000 | |||||||||||
Hubei Shanyin Wealth Management Co., Ltd [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 2,900,000 | |||||||||||
Hubei Shanyin Wealth Management Co., Ltd [Member] | Chief Executive Officer [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Loans Payable To Related Parties | 50,000 | 50,000 | ||||||||||
Ownership Interest, Percentage | 69.50% | |||||||||||
Borrowings Interest Rate, Percentage | 9% | |||||||||||
Interest Expenses | 4,700 | 4,700 | ||||||||||
Interest Payable | ¥ 19,700 | ¥ 15,000 | ||||||||||
Loans Payable | ¥ 60,000 |
Legal proceedings (Details Narr
Legal proceedings (Details Narrative) - CNY (¥) | 1 Months Ended | 18 Months Ended | ||||||||||
Oct. 14, 2019 | Oct. 09, 2019 | Sep. 06, 2019 | Apr. 30, 2020 | Aug. 31, 2019 | Oct. 30, 2020 | Nov. 10, 2020 | Aug. 31, 2020 | Dec. 04, 2019 | Oct. 15, 2019 | Aug. 27, 2019 | Jul. 31, 2019 | |
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 9,000,000 | |||||||||||
Owned Percentage | 30% | |||||||||||
Wuhan Wuchang People's Court [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Payable To Related Party | ¥ 2,560,000 | |||||||||||
Mr Deng Xinxue, Mr Zhang Xuan and Mr Yang Bobiao [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Owned Percentage | 69.50% | |||||||||||
Property Services Co., Ltd [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Accrued Interest | ¥ 310,311 | ¥ 193,944 | ¥ 238,344 | |||||||||
Property Service Fee | ¥ 310,311 | ¥ 193,944 | ¥ 238,344 | |||||||||
Mr Wei Qizhi Wei, Ms Peng Yan, and Chutian [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 12,300,000 | |||||||||||
Chutian [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 9,000,000 | |||||||||||
Hubei New Nature Investment Co., Ltd [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 13,000,000 | |||||||||||
Owned Percentage | 80.80% | |||||||||||
Dunxin Holdings Co., Ltd [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 12,000,000 | |||||||||||
Owned Percentage | 70% | |||||||||||
Hubei Shanyin Wealth Management Co., Ltd [Member] | ||||||||||||
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 2,900,000 | |||||||||||
Share capital | ||||||||||||
Statement [Line Items] | ||||||||||||
Deposited In Bank Accounts | ¥ 12,000,000 | ¥ 12,300,000 | ||||||||||
Property Preservation Limit | ¥ 29,900,000 | |||||||||||
Value Of Attached Property | ¥ 220,000 | |||||||||||
Repay Borrowings Principal Amount | ¥ 10,000,000 | ¥ 10,000,000 | ||||||||||
Interest Expenses | 787,500 | |||||||||||
Principal Amount | ¥ 10,000,000 | ¥ 10,000,000 |