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神州长城(000018)公告正文

神州B:2016年半年度报告(英文版)

公告日期:2016-08-27

                  Sino Great Wall Co., Ltd. The Semi-annual Report 2016




  Sino Great Wall Co., Ltd.
The Semi-annual Report 2016




        August 2016




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                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016




                  I. Important Notice, Table of Contents and Definitions

The Board of Directors and the directors, Supervisory Committee and supervisors and Senior Executives of the
Company hereby warrant that at the year , there are no misstatement, misleading representation or important
omissions in this report and shall assume joint and several liability for the authenticity, accuracy and completeness
of the contents hereof.


All the directors attended the board meeting for reviewing the Semi-Annual Report.
The Company has no plan of cash dividends carried out, bonus issued and capitalizing of common reserves either.


Mr.Chen Lve , The Company leader, Mr. Cui Hongli, Chief financial officer and the Mr. Cui Hongli, the person in
charge of the accounting department (the person in charge of the accounting )hereby confirm the authenticity and
completeness of the financial report enclosed in this semi-annual report.




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                                                            Sino Great Wall Co., Ltd. The Semi-annual Report 2016



                                         Table of Contents




Semi-Annual Report 2016

I.Important Notice, Table of contents and Definitions

II. Basic Information of the Company

III. Summary of Accounting Data and Financial Indicators

IV. Report of the Board of Directors

V. Important Events

VI. Change of share capital and shareholding of Principal Shareholders

VII. Situation of the Preferred Shares

VIII.Information about Directors, Supervisors and Senior Executives

IX. Financial Report

X. Documents available for inspection




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                                                                Sino Great Wall Co., Ltd. The Semi-annual Report 2016




                                                  Definition


                                         Refers
              Terms to be defined                                                  Definition
                                           to
                                         Refers
Company Law                                       Company Law of the People’s Republic of China
                                           to
                                         Refers
Securities Law                                    Securities Law of the People’s Republic of China
                                           to
                                         Refers
“CSRC”                                          China Securities Regulatory Commission
                                           to
                                         Refers
Company,The Company, Sino Great Wall              Sino Great Wall Co., Ltd.
                                           to
                                         Refers
Sino International                                Sino Great Wall International Engineering Co., Ltd.
                                           to
                                         Refers
BDO                                               BDO China Shu Lun Pan Certified Public Accountants LLP
                                           to
                                         Refers
SZSE                                              Shenzhen Stock Exchange
                                           to
                                         Refers
Reporting period                                  January 1,2016 to June 30,2016
                                           to
                                         Refers
Wuhan Commercial & Vocational Hospital            Wuhan Commercial & Vocational Hospital Co.,Ltd
                                           to




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                                                                       Sino Great Wall Co., Ltd. The Semi-annual Report 2016



                                         II. Basic Information of the Company
I.Company Information

Stock abbreviation:              Sino Great Wall     Sino-B             Stock code:                   000018      200018
Stock exchange for listing       Shenzhen Stock Exchange
Name in Chinese                  神州长城股份有限公司
Chinese Abbreviation             神州长城     神州 B
English name (If any)            Sino Great Wall Co., Ltd.
English Abbreviation (If any) Sino Great Wall        Sino-B
Legal Representative             Chen Lve
II. Contact person and contact manner
                                          Board secretary                                 Securities affairs Representative
Name                  Yang Chunling                                           Liu Guofa
                                                                              Sino Great Wall Building, No.3 Jinxiu
                      Sino Great Wall Building, No.3 Jinxiu Street,Economic
Contact address                                                               Street,Economic Technology Development Zone ,
                      Technology Development Zone , Beijing
                                                                              Beijing
Tel                   010-89045855                                            010-89045855
Fax                   010-89045856                                            010-89045856
E-mail                1208806865@qq.com                                       000018sz@sina.com


3.Other

(1)Way to contact the Company

Whether registrations address, offices address and codes as well as website and email of the Company changed in
reporting period or not
□ Applicable □√ Not Applicable
The registered address, office address and their postal codes, website address and email address of the Company
did not change during the reporting period. The said information can be found in the 2015 Annual Report.

(2)About information disclosure and where this report is placed

Did any change occur to information disclosure media and where this report is placed during the reporting period?
□ Applicable √ Not applicable
The newspapers designated by the Company for information disclosure, the website designated by CSRC for
disclosing this report and the location where this report is placed did not change during the reporting period. The
said information can be found in the 2015 Annual Report.

(3)Registration changes of the Company

Whether registration has changed in reporting period or not
□ Applicable √ Not applicable



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                                                                         Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Date/place for registration of the Company, registration nmber for enterprise legal license number of taxation
registration and organization code have no change in reporting period, found more details in annual report 2015.



III. Summary of Accounting Data and Financial Indicators

1.Summary of accounting /Financial Data

May the Company make retroactive adjustment or restatement of the accounting data of the previous years due to
change of the accounting policy and correction of accounting errors.
□Yes √No
                                                 Reporting period             Same period of last year      YoY+/-(%)
Operating income(RMB)                               1,953,574,755.51                 2,081,209,219.16               -6.13%
Net profit attributable to the shareholders
                                                        202,299,416.64                   165,342,341.12               22.35%
of the listed company(RMB)
Net profit after deducting of non-recurring
gain/loss attributable to the shareholders of           175,937,165.15                   165,020,064.04                   6.62%
listed company(RMB)
Cash flow generated by business operation,
                                                     -1,256,615,959.20                  -243,795,872.83              415.44%
net(RMB)
Basic earning per share(RMB/Share)                                     0.12                          0.10             20.00%
Diluted gains per
                                                                       0.12                          0.10             20.00%
share(RMB/Share)(RMB/Share)
Weighted average ROE(%)                                         14.47%                           12.84%                   1.63%
                                                As at the end of the
                                                                              As at the end of last year    YoY+/-(%)
                                                 reporting period
Gross assets (RMB)                                    5,781,742,089.91                 4,017,462,824.63               43.92%
Shareholders’ equity attributable to
                                                      1,514,525,228.17                 1,282,256,738.74               18.11%
shareholders of the listed company(RMB)


II. Differences between accounting data under domestic and overseas accounting standards

1. Differences of net profit and net assets disclosed in financial reports prepared under international and
Chinese accounting standards.

□ Applicable √Not applicable
No difference.

2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards.

□ Applicable √Not applicable
No difference .



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                                                                           Sino Great Wall Co., Ltd. The Semi-annual Report 2016


III.Items and amount of non-current gains and losses

√Applicable □Not applicable
                                                                                                                                 In RMB
                                Items                                           Amount                             Notes
Except the effective hedge business related to the normal
operation business of the Company, the profit and loss in the
changes of fair values caused by the holding of tradable financial                                   Proceeds from the sales of bank
                                                                                         46,868.49
assets and tradable financial liabilities as well as the investment                                  financial products
returns in disposal of tradable financial assets, tradable financial
liabilities and saleable financial assets
                                                                                                     According to the Land Transfer
                                                                                                     (Expropriation) Compensation
                                                                                                     Agreement of Shenzhen Dapeng
                                                                                                     New District People's Hospital
                                                                                                     Construction Project, the
Other non-operating income and expenditure except for the                                            compensation shall be made for
                                                                                    26,315,383.00
aforementioned items                                                                                 the expropriation of the land and
                                                                                                     on-ground buildings in Kuixin
                                                                                                     community which belongs to the
                                                                                                     company’s Kuiyong branch
                                                                                                     located in Shenzhen Dapeng New
                                                                                                     district.
Total                                                                               26,362,251.49                    --
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Compaines Offering their Securities to the Public-Non-recurring Gains and Losses and
its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure
for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as
recurring gains and losses, it is necessary to explain the reason.
□ Applicable √ Not applicable
None of Non-recurring gain /loss items recorgnized as recurring gain /loss/itesm as defined by the information
disclosure explanatory Announcement No.1- Non –recurring gain/loss in the report period.




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                                                                   Sino Great Wall Co., Ltd. The Semi-annual Report 2016



                                     IV. Report of the Board of Directors

I. General

      Since 2015, SGW Co., LTD has shorten the interior fitting business in China , extensively developed the ove
rseas EPC projects and investment opportunity, and strengthen the Medical Care and PPP investment. Affected b
y the slowdown in the domestic construction market and so forth factors, the company’s domestic decoration busi
ness had got a slowdown in a certain extent, gross profit margin is low. As for the company's overseas business d
evelopment, , SGW successively signed a major construction contracts in southeast Asia and Africa, other countri
es and regions. SGW signed a memorandum of understanding about Ethiopia medical industrial park with China's
transportation construction Co.,Ltd. International engineering branch. The overseas business has kept good growth
 rate, overseas revenue grew by 103.64% year on year, which covers the rate of74.62% of total revenue of SGW
Co., LTD.
      For the Medical Care, SGW Co., LTD has acquired Wuhan Commercial & Vocational Hospital Co.,Ltd (here
inafter referred to as "Wuhan Commercial & Vocational Hospital ") . Moreover, SGW invested the PPP Project of
 the first Phase of Lu YI Xian Ren Ming Hospital Removal and Construction Works. SGW Co., Ltd won the bid o
f Guizhou Zhong Shan Liang DU Hong Qiao Third-Grade Class-A Hospital Project. And the medical care invest
ment and PPP project have a very good beginning.
      To look forward, based on the analysis to the Construction Market of domestic and Abroad and current state
and future development prospect, SGW Co., Ltd will go on strengthening the EPC Contracting and investment alo
ng the “ One Road, One Belt” Countries, enhance the investment of Medical Care and PPP business to keep the ra
pid growth of current business. Besides, in order to secure the stable growth of domestic business, the Company w
ill actively respond to the Government Policy, Seize the development opportunity , where Chinese Government an
d Social Capital work together, fully develop the PPP investment and construction opportunity. SGW Co. Ltd wi
ll improve its business scope and profitability so as to lay a solid foundation for the everlasting development.
      During the reporting period, the company realized the total revenue of RMB 1953.5748 million, a decrease
of 6.13% compared to the same period of last year; realized the operating profits of RMB 213.0631 million, a
decrease of 5.79% compared to the same period of last year; realized the net profits attributable to shareholders of
the listed company of RMB 202.2994 million, an increase of 22.35% compared to the same period of last year.

II. Analysis on principal Business

Year-on-year changes in major financial statistics
                                                                                                                        In RMB
                                                                          YOY
                          This report period    Same period last year                              Cause change
                                                                        change(%)
Operating income
                             1,953,574,755.51       2,081,209,219.16        -6.13% 。

Operating cost               1,460,727,131.33       1,690,684,183.21       -13.60%
Sale expenses                    9,259,264.24           7,502,905.30        23.41%
                                                                                     Mainly due to the setting-up of overseas
                                                                                     group company and overseas regional
Administrative expenses        112,993,754.29          64,838,318.67        74.27%
                                                                                     companies in the second half year of 2015.
                                                                                     Due to the increase of overseas


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                                                                        Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                                                                                        management personnel in the current
                                                                                        reporting period compared to the previous
                                                                                        period.
                                                                                        Due to the increase of borrowing from
Financial expenses                  70,024,674.60          17,908,021.84      291.02%
                                                                                        financial institutions in the current period
                                                                                        Due to the change of income tax rate of the
Income taqx expenses                37,862,759.83          61,167,289.27      -38.10%
                                                                                        company’s subsidiary
R&D investment                      64,858,681.88          64,725,606.72        0.21%
                                                                                          Due to the project cash deposit as
                                                                                        collateral and expenditure of advanced
Net cash flows from
                                 -1,256,615,959.20        -243,795,872.83     415.44% payment increased largely as the overseas
operating activities
                                                                                        business increased rapidly in the current
                                                                                        period
                                                                                        Due to the payable of Wuhan Commercial
Net cash flows from
                                   -100,287,677.86         -16,471,509.45     508.86% & Vocational Hospital Co.,Ltd in the
investing activities
                                                                                        current period.
Net cash flows from                                                                     Due to the borrowing from bank increased
                                 1,383,660,404.96         177,769,654.93      678.34%
financing activities                                                                    in the current period
Net increase in cash and
                                    28,377,720.07          -82,539,347.92    -134.38%
cash equivalents
Major changes in profit composition or cources during the report period
□ Applicable √ Not applicable
The profit composition or sources of the Company have remained largely unchanged during the report period.
Delay of future development and plan disclosed in Company’s IPO prospectus, fund raising prospectus and capital
reorganization report into this report period.\
□ Applicable √ Not applicable
No future development and plan disclosed in Company’s IPO prospectus, fund raising prospectus and capital
reorganization report into this report period.
Implementation of business plans disclosed in previous periods in this period.
In view of the international and domestic economic situation, the company formulated the business plan of
"strengthening the domestic decoration main business, expanding overseas construction market and promoting the
layout in the health-care industry to ensure steady growth of business performance". During the reporting period,
the company's overseas business maintained good growth, in the first half of the complete overseas business
income is 1.458 billion RMB, the new signing and the winning project engineering 7.6 billion RMB; Company
steadily promoting health investment, acquisition of Wuhan Commercial and Vocational Hospital, hospital PPP
projects fall to the ground, one after another good operating plan execution.
III. Composition of principal businesses
                                                                                                    In RMB
                                                                                                 Increase/decrease Increase/decrease
                                                                            Increase/decrease
                                                                                                    of principal     of gross profit
                                                                            of reverse in the
                       Operating                            Gross profit                        business cost over    rate over the
                                        operating costs                      same period of
                       revenue                                rate(%)                             the same period    same period of
                                                                              the previous
                                                                                                  of previous year the previous year
                                                                                year(%)
                                                                                                        (%)               (%)


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                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Industry
Decoration works     514,581,944.96   430,177,995.85       16.40%          -63.02%         -63.21%            0.42%
Engineering
                   61,377.29             989,075.00        65.43%          -44.58%         -68.76%           26.76%
design
EPC                1,430,818,506.77 1,029,560,060.48       28.04%         113.63%          102.36%            4.01%
Product
None
Area
     Domestic        495,748,253.47   409,999,729.35       17.30%          -63.69%         -64.17%            1.11%
     Overseas      1,457,710,561.70 1,050,727,401.98       27.92%         103.64%           92.34%            4.23%


IV. Analysis on Assets and Liabiliti

     Great Wall Co., Ltd., an comprehensive building operation enterprise, specializes in designing and
constructing for the building decoration engineering as well as relevant engineering operation. The Company’s
building operation business mainly includes overseas engineering contract and domestic engineering decoration,
electromechanics installment and curtain wall design and operation. In recent years, with the larger strength in
extending the Company’s overseas market, the increasing quantity and scale of overseas project and the strong
growth in overseas business, the Company’s competitive advantages are mainly reflected as the following aspects:

1.        Service advantages of integration
   The Company owns Grade A qualification of specific building decoration engineering and design, Grade I
qualification to professionally contract the building decoration engineering, Grade I qualification to professionally
contract electromechanic installment engineering and Grade I qualification to professionally contract the curtain
wall installment engineering. Meanwhile, the Company owns the qualification to operate the external engineering
contract. The complete design and operation qualification owned by the Company enable itself to provide the
clients with the integration service of the whole industrial-chain operation and design in decoration,
electromechanics installment and curtain wall. The Company has experienced in operation and ability on project
management with the whole industrial-chain integration services, such as project design, civil engineering,
electromechanics, refined decoration and the fire safety of curtain wall, where the Company can independently
complete the whole process of operation business for the building engineering project. In the area of building
engineering, the Company can form a joint-force advantage, reasonably arrange purchase, labor and the operation
plan for projects, optimizing the progress of project, effectively shorten the project time limit, decreasing the
overall cost of the project and realizing the maximum in the project profit.
2.       Preemptive advantages and brand effect of overseas business
   Judging from the international and domestic economic situations and the construction market, the company
assessed the situation ahead of others and made the layout of the overseas market, to form marketing team for
overseas construction business in advance, cultivate abilities of project management training and business
negotiation, and accumulate experience in the construction project. Familiar with the political and economic
environment in overseas markets, the construction market environment and labor market and labor regulations, the
company can make reasonable estimates about construction projects, effectively control construction projects and
win customers' acceptance by offering the engineering of perfect quality. With winning the bid and completion of
local landmarks, the company's visibility and influence in countries of the Middle East, Southeast Asia has been
increasing promoted establishing a good corporate image and brand image.


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                                                                         Sino Great Wall Co., Ltd. The Semi-annual Report 2016


3.     Advantages of talented personnel
     Talent competition is the core part of enterprise competition, as talents are the most valuable asset of
enterprises. In order to ensure the stability of the company's personnel, various effective measures has be carried
out, including continuing to introduce talents, mobilizing and inspiring the enthusiasm and creativity of employees
work, sharing incentives for business growth with employees, and giving part of the company directors,
supervisors and senior management personnel and business backbones the privileged rights to purchase
non-public shares. In this way, listed companies and employees share a mutual benefits, and their subjective
initiative would be inspired, promoting the company's rapid development of overseas and domestic business The
Company’s core business management team, experienced in operating and skillfully marketing, is of high quality
and capability, like management capability, leaving good support for development of the company in future.

     4.Distribution Advantage of Healthcare Industry

     The Company mainly adopts the model of PPP.With the correlated approach of Construction plus Healthcare,
the Company purchases or co-operates the current hospital and invests to build new hospitals as well as other
healthcare projects. Since 2015, the Company has taken healthcare industry as another key point for the future
development, and the Company has purchased Commercial Employees Hospital of Wuhan,and has invested in
relocation project period I of People’s Hospital of Luyi as well as winning the bidding of the project of Guizhou
Zhongshan Liangdu Hongqiao Top Three Hospital, where distribution goes well in healthcare industry.

V. Analysis on investment Status

1. External Equity investment

(1)External investment

√Applicable □Not applicable
                                                       External investment
     Investment amount (January-June
                                                  Investment Amount (January-June 2015)(RMB)                     Change rate(%)
              2016)(RMB)
                                9,700.00                                                                  0.00               100.00%
                                                     Particulars of investees
                                                                                                                  Proportion in the
                   Name                                              Principal business
                                                                                                                 investees’ equity(%)
                                           Preventive health care section, internal medicine, surgery,
                                           obstetrics and gynecology, pediatrics, ophthalmology,
                                           otolaryngology, department of stomatology, department of
                                           dermatology, infection disease department, oncology,
                                           department of anesthesiology, medical laboratory, department of
Wuhan Commercial & Vocational
                                           pathology, medical imaging department, department of                              100.00%
Hospital Co.,Ltd
                                           traditional Chinese medicine, integrated traditional Chinese
                                           medicine and Western Medicine, hemodialysis room. (The
                                           business scope and the operating period complied with the
                                           business scope and the operating period of the approved license).
                                           (Items subject to the approval by laws shall be carried out after


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                                                                 Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                                      the approval by the relevant departments)




(2)Holding of the equipty in financial enterprises

□ Applicable √ Not applicable
There was no Holding of the equipty in financial enterprises.

(3)Securities investment

□ Applicable √ Not applicable
There was no investment in securities by the Company in the Reporting period.

(4)Explanation on Holding Equity in Other Listed Companies

□ Applicable√ Not applicable
There was no holding equity in other listed companies in the reporting period.

II.Information nof trust management, derivative investment and entrusted loan

(1)Trust management

□ Applicable √Not applicable
There was no trust management of the Company in the Reporting period.

(2)Derivative investment

□ Applicable√ Not applicable
There was no derivative investment of the Company in the reporting period.

(3)Entrusted loan

□ Applicable√ Not applicable
There was no entrusted loan of the Company in the reporting period.

III.Application of the Raised funds

√ Applicable □ Not applicable

(1)General application of the raised funds

√ Applicable □ Not applicable
                                                                                                         In RMB’0000


Total amount of the raised capital                                                                            25,500


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                                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Total raised capital invested in the report period                                                                                       3,366.36
Total accumulative raised capital invested                                                                                               4,966.36
Amount of raised capital of which the purpose was changed in the
                                                                                                                                                  0
report period
Accumulative amount of raised capital of which the purpose has been
                                                                                                                                                  0
changed
Proportion of raised capital of which the purpose has been changed
                                                                                                                                             0.00%
(%)
                                                        Notes to use of raised capital
      As of June 30, 2016, the accumulative use of the raised funds by the company was RMB 49,663,565.80, and for the reporting
period, the amount of RMB 33,663,565.80 of raised funds was used. As of the end of the reporting period, the company invested a
total of RMB 32,265,103.15 to the overseas marketing network construction project, the amount of RMB 276,000 was invested for
the second phase construction of the informationalization project, the transaction related taxes and fees and intermediary fees were
RMB 17,122,462.65, the balance of the raised funds that have not been used was RMB 205,336,422.92; besides, there was RMB
150,000,000 of idle raised funds temporarily used for supplementing the company’s liquidity, the interest income of the special
account for raised funds was RMB 348,438.57, the handling charge of the special account for raised funds was RMB 639.26 and
the actual balance of the special account for raised funds was RMB55,684,222.23.


(2)Promised projects of raised capital

√ Applicable □ Not applicable

                                                                                                                                      In RMB’0000
                                                                                                     Date
                                                                            Accumul Investme
                                                                                                   when the
                                       Total                                  ated         nt                                            Has any
                           Project                   Total     Amount                               project    Benefit
                                       raised                                amount     progress                            Has the      material
                          changed(i              investme inested in                                 has       realized
Committed investment                   capital                              invested ended the                             predicted     change
                          ncluding               nt after        the                               reached      in the
projects and investment               invested                              at the end reporting                           result be      taken
                           partial               adjustme reporting                                   the      reporting
                                         as                                  of the     period(%                           realized      place in
                          change)                    nt (1)    period                              predicted    period
                                      commited                              reporting )(3)=(2)(                                         feasibility
                                                                                                   applicabl
                                                                            period(2)      1)
                                                                                                   e status
Committed investment projects
1. Overseas marketing
network construction      No            10,000       10,000 3,226.51 3,226.51            32.27%                            Yes          No
project
2.Informatization
                          No             2,500         2,500       27.6          27.6     1.10%                            Yes          No
Construction Phase II
3.Related taxes and
agency fees of this       No            13,000       13,000      112.25 1,712.25         13.17%                            Yes          No
transaction
Subtotal of committeed
                               --       25,500       25,500 3,366.36 4,966.36              --         --                         --          --
investment projects
Investment orientation for und arising out of plan


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                                                                         Sino Great Wall Co., Ltd. The Semi-annual Report 2016


No
Total                         --       25,500     25,500 3,366.36 4,966.36          --         --             0      --         --
Situation about not
coming up to schemed
progress or expected     Not applicable
revenue and the reason
( in specific project)
Notes to significant
change in feasibility of No
the project
Amount, application      Not applicable
and application
progress of the
unbooked proceeds
About the change of      Not applicable
the implementation
site of the projects
invested with the
proceeds
Adjustment of the        Not applicable
implementation way of
investment funded by
raised capital
About the initial        Not applicable
investment in the
projects planned to be
invested with the
proceeds and the
replacement
                         Applicable
                         For maximizing the using efficiency of the raised funds and reducing the financial costs, the company shall,
                         with full consideration of the funds use plan for the projects invested by the raised funds, use RMB
Using the idle
                         150,000,000.00 to temporarily supplement the liquidity, with a term not exceeding 12 months and such
proceeds to
                         amount was expected to be returned to the special account for raised funds before May 30, 2017. Such item
supplement the
                         had been examined and approved in the 9th board meeting of seventh session board of directors of the
working capital on
                         company, and the company's board of supervisors, independent directors and the sponsor all had issued a
temporary basis
                         consent to it. During the use term, the company did not change the purpose of the raised funds, not affect
                         the normal conduct of the investment plans by the raised funds and not carry out the securities investment
                         and so forth risky investment.
Balance of the           Not applicable
proceeds in process of
project implementation
and the cause
About application and Unused raise funds to raise money deposited in the account


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                                                                                Sino Great Wall Co., Ltd. The Semi-annual Report 2016


status of the proceeds
unused
Problems existing in
application of the
proceeds and the           Not applicable
information disclosure
or other issues


(3)Changes of raised funds projects

□ Applicable √ Not applicable
The Company had no raised funds in company reporting period.

(4)Fund-raising project

        Fund-raising project overview                           Disclosure date                                 Disclosure index
Special report of raised storage and usage         August 27,2016                                    http://www.cninfo.com.cn


4.Analysis on principal subsidiaries and Mutual Shareholding Companies

√Applicable □Not applicable
Particulars about the principal subsidiaries and Mutual shareholding companies
                                                                                                                                       In RMB
                                                Leading                        Total                                  Operating
    Company   Compan         Sectors                        Registered                       Net assets   Tumover                  Net Profit
                                            products and                 assets(RMB                                    profit
     Name         y type    engaged in                        capital                         (RMB)       (RMB)                     (RMB)
                                                services                         )                                     (RMB)
                                         Construction
                                         general
                                         contracting,
                                         labor
                                         subcontracting;
                                         engineering
Sino Great                 Contract of survey and
Wall                       construction design;
Internationa Subsidiar project,          professional                        5,149,598,5 1,379,172,8 1,953,458,8 246,681,8 208,881,098.
                                                            70,136,099
l             ies          decoration,   contracting;                                75.25        29.79       15.17       84.71             88
Engineering                healthcare    engineering
Co., Ltd.                  investment    design for the
                                         construction
                                         decoration;
                                         building curtain
                                         wall design,
                                         etc.




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                                                                       Sino Great Wall Co., Ltd. The Semi-annual Report 2016


V. Significant projects of investments with non-raised funds

□ Applicable √ Not applicable
The company has no project invested by raised fund in the reporting period.

VI. Prediction of business performance for January -September 2016.

Estimation of accumulative net profit from the beginning of the year to the end of next report period to be loss
 probably or the warning of its material change compared with the corresponding period of the last year and
 explanation of reason.

√ Applicable □Not applicable
Forenotice of earning :√Year-on-year increase
Type of data filet for the prediction
                                                              Same period of
                            Year beginning to end of next
                                                               the previous                 Increase or decrease%
                                     report period
                                                                    year
Estimated amount of
accumulative net                  29,000 --          34,000         24,295.28 Increase                   20.00% --        40.00%
profit(RMB’0000)
Basic earnings per shares
                                    0.17 --            0.20                0.14 Increase                    21% --           43%
(Yuan/share)
                             The company's overseas business was steadily developed with a growing momentum, which led to
                            that the company’s profits were steadily increasing, therefore the company implemented the plan of
Notes to forenotice of
                            increasing shares by converting capital reserve into share capital-on the basis of 28 shares increased
earnings
                            for every 10 shares, which rendered that earnings per share from the begging of the year to the next
                            reporting period decreased a little compared to the same period last year/


VII. Explanation of the Board of Directors and the Supervisor Committee concerning the “Non-standard
audit report ” issued by the CPAs firm for the reporting period

□ Applicable √ Not applicable

VIII.Explanation by the Board of Directors about the “ non-standard audit report “ for lastyear.

□ Applicable √ Not applicable

IX. Profit distribution carried out in the report period

Execution or adjustment of profit distribution, especially cash dividend, and capitalizing of reserves in the report
period.
√ Applicable □Not applicable
During the reporting period, upon the base of total share capital of 446,906,582 shares on the date of December 31,
2015, 28 shares were increased for every 10 shares to all the shareholders by converting capital reserve into share
capital, therefore the total increased shares by converting capital reserve into share capital were 1,251,338,429

                                                               16
                                                                            Sino Great Wall Co., Ltd. The Semi-annual Report 2016


shares, so the total share capital were 1,698,245,011 shares after such share increasing by converting capital
reserve into share capital.

                                             Special explanation of the cash dividend policy
Whether conformed with the regulations of the Articles of
association or the requirements of the resolutions of the             Yes
shareholders’ meeting:
Whether the dividend standard and the proportion were definite
                                                                      Yes
and clear:
Whether the relevant decision-making process and the system
                                                                      Yes
were complete:
Whether the independent director acted dutifully and exerted the
                                                                      Yes
proper function:
Whether the medium and small shareholders had the chances to
fully express their suggestions and appeals, of which their legal     Yes
interest had gained fully protection:
Whether the conditions and the process met the regulations and
was transparent of the adjustment or altered of the cash dividend Not a;pplicable
policy:


X. Preplan for profit distribution and turning capital reserve into share capital in the reporting period

□ Applicable √ Not applicable

The Company planed that no to distribute cash dividend, bonus shares and there was no turning of capital reserve
into share capital.

XI. Particulars about researches, visits and interviews received in this reporting period

√ Applicable □ Not applicable
                       Reception        Way of       Types of                                             Discussion topics and
  Reception time                                                             Vistors rece3ived
                          place         reception    visitors                                             provision of materials
                                                                                                       Information of the
                                                                                                       company's overseas orders
                     BOD office                                                                        and overseas staffing; the
                                    Onsite          Organizati GF Securities . Tang Xiao, GF
January 20,2016       of the                                                                           company’s advantages of
                                    investigation on              Securities.Yue Hengyu
                      Company                                                                          entering into the medical
                                                                                                       industry. No document
                                                                                                       provided
                                                                 Guohai Securities. Wang Xin, Yinhua   The situation and
                     BOD office                                  Fund. Su Jingran, Yinhua Fund. Li     advantages of the
                                    Onsite          Organizati
February 1,2016      of the                                      Xiaohui,South Fund. Cao Fan. Minsheng company's overseas
                                    investigation on
                     Company                                     Securities. Yan Xiaoqing, Minsheng    business; the mode of the
                                                                 Securities.Wang Xiao, BOBBNS. Wang    company's investment to


                                                                     17
                                                                 Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                                                       Liang,CMS. Wang Binpeng,Great Weal       hospitals, negotiated
                                                       Wealth Assets. Zhang Yuehong,Shibei      priorities, impacts to the
                                                       Investment. Pan Hongxing,CRT. Xiao       company’s business
                                                       Chuanzhe and CRT. Li Yanhua.             performance and staffing of
                                                                                                the medical team. No
                                                                                                document provided


                                                                                                The mode of the company's
                                                                                                investment to hospitals,
                                                       Wanmeng Shengshi. Liu Zhikai,            negotiated priorities,
                BOD office                             Wanmeng Shengshi. Sun Yuqi, Wanmeng impacts to the company’s
                             Onsite       Organizati
March 3,2016    of the                                 Shengshi Gong Pu, Hanhe Capital. Xue     business performance;
                             investigation on
                Company                                Tao,Essences. Song Yilu, Essences. Xia   Information of the
                                                       Tian and Huaxia Life. Xie Dacheng.       company's overseas orders
                                                                                                and overseas staffing. No
                                                                                                document provided
                                                                                                Engineering information of
                                                                                                the company’s domestic
                BOD office
                             Onsite       Organizati Mingji International Investment .Zhu       and foreign business and
March 11,2016    of the
                             investigation on          Quan.                                    the considerations on the
                 Company
                                                                                                medical field investment.
                                                                                                No document provided
                                                                                                Information of the
                                                                                                company’s business
                BOD office
                             Onsite       Organizati Xingshi Investment. Feng Du, Yin Hua       performance, orders in hand
May 4,2016      of the
                             investigation on           Fund. Zhang Ke.                         and the mode of investment
                Company
                                                                                                to hospitals. No document
                                                                                                provided
                                                       Hina Brodercasting Culture Media
                                                       Group.Xiong Shengyou, Hina                The company’s basic
                                                       Brodercasting Culture Media Group. Qin information, development
                BOD office
                             Onsite       Organizati Weichuan, Guotai Junan . Chen              strategy and information of
May 24,2016     of the
                             investigation on          Xiao,Guotai Junan . Shen Zhenhao, Holly medical business
                Company
                                                       Hight . Jia Shuai, Daxing Sixiang. Zhang development. No document
                                                       Liang,Guohai Securities. Wang Xin and    provided
                                                       Guohai Securities. Li Xiang.




                                                           18
                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016




                                            V. Important Events

1.Governance of the Company

During the reporting period, The company has strictly abided by the relevant laws, rules and regulations requested
on “Corporate Law”, “Securities Law”, “Listing Rules of Shenzhen Stock Exchange” and
“Governance Rules of Listed Companies” and by China Securities Regulatory Commission, established and
perfected the internal control management system, and constantly made the deep improvement of the corporate
governance activities to further standardize the company operations and improve the management level. The
company’s governance meets the basic requirements of regular documents on the governance of the listed
companies issued by China Securities Regulatory Commission.On March 14,2016,The Proposal on Revising the
Articles of Association of the Company and the Proposal on Revising the Company's Internal Control System
were examined and approved in the 5th board meeting of the company’s seventh session board of directors, which
had comprehensively revised the company’s Articles of Association and each management system.
  (1).Shareholders and shareholders' general meeting: The Company convened and held shareholders' general
meeting strictly according to the requirements of Opinions on Standardization of Shareholders' General Meeting
of Listed Companies, formulated Rules of Procedure of Shareholders' General Meeting, ensured all shareholders,
especially medium and small shareholders, enjoy equal position and can fully exercise their own rights.
(2).Relationship between the controlling shareholder and the Company: The acts of the controlling shareholder of
the Company were standardized. It did not exceed the authority of the shareholders' general meeting to directly or
indirectly intervene with the decision-making and operating activities of the Company. The Company is
independent from its controlling shareholder in respect of personnel, assets, finance, organ and business. The
board of directors, the supervisory committee and internal organ of the Company are able to operate
independently.
(3) The Directors and The Board of Directors: the Board of Directors includes four special committees, such as
Audit Committee, Nomination Committee, Strategy Committee and Remuneration and Appraisal Committee,
which has provided a favorable support to the company for the decision-making related issues. Each special
committee has operated according to their work responsibilities and procedure rules, made research and
examination for the relative business and major issues of the company, and expressed the professional opinions in
the Board of Directors to offer support and advice for the scientific decision-making of the Board and ensure the
Board’s work more scientific and efficient. Also, the organization of the Board of Directors is in line with the
requirement of laws and regulations, and the independent directors play an important role in the corporate
decision-making. So, the company attaches importance to the function of the independent directors. In the
company’s management, the independent directors make careful review and express the independent views for the
financial audit, the affiliated transactions and other issues.
(4).Supervisors and the supervisory committee: The number and composition of the Supervisory Committee of the
Company complied with the requirements of laws and regulations. The Supervisory Committee of the Company
formulated the Rules of Procedure of the Supervisory Committee. The supervisors of the Company were able to
perform their duties seriously, take the attitude of being responsible for all shareholders and supervise the legality
and regulation conformity of the Company's finance and the duty performance of the directors, managers and
other senior executives of the Company.
(5) During the report period, the Company’s shareholders strictly fulfilled the commitments made at the
reorganization, where no over-due fulfillment of commitment existed.

                                                         19
                                                                Sino Great Wall Co., Ltd. The Semi-annual Report 2016




  (6)Information disclosure and transparency: The Company designated the secretary to the board of directors to
be responsible for information disclosure, Regulations on Management of Information Disclosure,Regulations on
Management of External Information Users and reception of shareholder and consultation. In the report period,
the Company was able to truly, accurately, completely and timely disclose relevant information according to the
provisions of laws, regulations and the Articles of Association of the Company. The Company will continue to
operate in a standardized way strictly according to the requirements of relevant laws and regulations including the
Company Law, further perfect company administration structure and establish and improve various regulations in
light of the gap with the requirements of Standards of Administration of Listed Companies, ensure the
maximization of shareholders' interests and safeguard the lawful rights and interests of all shareholders.

(7)The legitimate rights and interests of stakeholders: the company respects and safeguards the interests of the
legitimate rights and interests of stakeholders, realized the balance of the rights and interests of all parties, such as
shareholders, customers, enterprise and staff. The company adhered to the win-win relationships and mutual
developments with the stakeholders
     Standardized operation is the foundation and guarantee for the healthy development of the enterprise, the
company will, in accordance with The Company Law, Provisional Code of Corporate Governance for Listed
Company, Shenzhen Stock Exchange Stock Listing Rules ,Standardize Operational Guidelines for Listed
Companies on the Main Board of Shenzhen Stock Exchange and the requirements of relevant laws and regulations,
continue to improve the internal control system and the corporate governance structure, raise the level of
standardized operation, safeguard the legitimate rights and interests of all shareholders, thus to ensure the
company’s sustainable, steady and healthy development.
There exist no difference in compliance with the corporate governance , the PRC Company Law and the relevant
provisions of CSRC.

II. Lawsuits affairs

Major lawsuits and Arbitration affairs

□ Applicable √ Not applicable
The Company has no major lawsuit or arbitration in the report period.

Other Lawsuits affairs

□ Applicable √ Not applicable
III. Query form media
□ Applicable √ Not applicable
In the reporting year, the Company had no query from media
IV. Bankruptcy or Reorganization Events
□ Applicable √ Not applicable
There Company was not involved in any bankruptcy or reorganization events in the reporting period.

V. Transaction in Assets

1. Purchase of assets

                                                           20
                                                                                  Sino Great Wall Co., Ltd. The Semi-annual Report 2016


√ Applicable □Not applicable
                                                                                   Ratio of
                                                                                                            Relation
                                                                                    the Net
                                                                                                                with
                                                                     Influence      Income
Counter-pa                                                                                                 Counter-pa
               Acquired Transactio                     Impact on      on the      Caused by
     rty or                                                                                    Connected        rty      Date of
                     or     n Price (10 Progress Company's Profit and              the Asset                                        Disclosure
 Ultimate                                                                                      Transactio (applicab Disclosure
               Purchased thousand         (Note 2)      Business Loss of the Contributi                                               Index
Controllin                                                                                         n            le to    (Note 5)
                 Assets       yuan)                     (Note 3)    Company        ng to the
     g Party                                                                                               associated
                                                                     (Note 4)       Listed
                                                                                                            business
                                                                                   Company
                                                                                                           situation)
                                                                                    in Total
                                                       Expanded
                                                       the
                                                                    The
                                                       company's
                                                                    contribute
                                                       medical                                                                      Securities
                                                                    d net
                                                       services,                                                                    Times,
13                                                                  profits
                                                       improved                                                                     Hong
individual                                                          (‘0000) to
               Wuhan Co                                the layout                                                                   Kong
shareholde                               The                        the listed
               mmercial                                of the                                                                       Commerci
rs                                       ownership                  company
               and                                     company's                                                                    al Daily
including                                transfer of                during the                                          May
               Vocational        9,700                 medical                         0.00% No            No                       and
Wang Jide,                               the assets                 period                                              11,2016
               Hospital C                              services                                                                     www.cninf
Fu                                       had been                   from the
               o.,Ltd                                  industry                                                                     o.com.cn..
jiuzhou,                                 completed                  date of
                                                       and it’s                                                                    www.cninf
Zeng                                                                purchase
                                                       conducive                                                                    o.com.cn.
Xiankao                                                             to the end
                                                       for making                                                                   On May
                                                                    of the
                                                       a new                                                                        11,2016
                                                                    reporting
                                                       profit
                                                                    period
                                                       growth
                                                       point
2. Sale of assets
□ Applicable √ Not applicable
There is no sale of assets in the Company during the reporting period
3. Business combination
□ Applicable √ Not applicable
There is no Bubiness combination in the Company during the reporting period
VI. Implementation and Influence of Equity Incentive Plan of the Company
□ Applicable √ Not applicable
There is no equity incentive plan and its implementation in the Company during the reporting period.
VII. Significant related-party transactions

1. Related transactions in connection with daily operation

√Applicable □ Not applicable



                                                                            21
                                                                      Sino Great Wall Co., Ltd. The Semi-annual Report 2016



                                                                                       Whether
                                                                             Trading
                                   Principl                                     over the
                                                                          limit                             Market               Index
                         Subjects e of                                          approve
                                                     Amount                                                 price of               of
                           of the pricing                     Ratio in approve                                       Date of
Related Relation Type of                    Price of of trade                             Way of            similar             inform
                          related    the                      similar              d                                 disclosu
parties  ship      trade                     trade RMB0’                                payment             trade               ation
                         transacti related                     trades       d                                           re
                                                       000                                                  availabl            disclos
                            ons transacti                                       limited                        e                  ure
                                     ons                               (RMB
                                                                                 or not
                                                                       ’0000)
                                                                                 (Y/N)
             The
           compan
           y where
Qinghai       the
                      Procure                                                                    Quarterl
Heyi       Compan
                      ment of Material Market Market                                             y          Market
Trade         y’s                                        2,134.06    2.12     6,000 No
                      goods/se Goods price        price                                          settleme price
Co.,       director
                      rvices                                                                     nt
Ltd.        holds
           the post
           of legal
            person
Kunwu
 Jiuding
           5% or
 Invest
           more
 ment
           sharehol
 Manag                Sale of                                                                    Settleme
           ders are              Decorati Market Market                                                     Market
 ement                goods /                                 25.7    0.50             No        nt by
           subject               on items price   price                                                     price
 Co.,                 services                                                                   contract
           to the
 Ltd.
           same
 And
           control
 related
 party
             The
           compan
           y where
Beijing       the
Baolilai Compan Sale of                                                                          Settleme
                                 Decorati Market Market                                                     Market
Technol       y’s    goods /                                 19.8   0.038             No        nt by
                                 on items price   price                                                     price
ogy Co., director services                                                                       contract
Ltd.        holds
           the post
           of legal
            person
Total                                        --      --   2,179.56   --        6,000        --        --       --       --        --
Details of any sales return of a large None



                                                                22
                                                                             Sino Great Wall Co., Ltd. The Semi-annual Report 2016


amount
                                               On April 13,2016, the Company convened the 6th meeting of the 7th board of
                                          directors,which examined and adopted “Proposal on the Company’s Daily Related
Give the actual situation in the report
                                          Transaction in 2016”, predicting the total amount of daily transaction between the Qinghai
period where a forecast had been
                                          Heyi Trade Co., Ltd., the related party, incurred RMB 60 million. This proposal has been
made for the total amounts of routine
                                          examined and adopted by the annual shareholder’s meeting of the Company in 2015: The
related-party transactions by type to
                                          related transaction amount actually incurred RMB 21.7956 million in the first half year of
occur in the current period(if any)
                                          2016.


Reason for any significant difference
between the transaction price and the Not applicable
market refernce price (if applicable)
2. Related-party transactions arising from asset acquisition or sale
□ Applicable √ Not applicable
The Company was not involved in any related-party transactions arising from asset acquisition or sale during the
reporting period.
3. Related-party transitions with joint investments
□ Applicable √ Not applicable
The Company was not involved in any related-party transaction with joint investments during the reporting
period.

4. Credits and debt with related parties

√ Applicable □ Not applicable

The existence of non operating related credit and debt of the Company.
□Yes√ No
There existence of non operating related credit and debt of the Company of the reporting period.
Debt due to related parties:
Related      Connection      Reasons          Opening           New issue           The amount       Rate         Interest       Closing
partty       relateion                        balance           amount               ofrestitution                                Balance
                                                                                     period
             Controlling
             shareholder     business
Chen Lue                                           38,028.76              9,385.5        47,414.26      0.00%                0             0
             and actual      development
             controller
             Controlling
             shareholder
                             Support
Xian         and actual
                             business                       0       15,000,000         15,000,000       0.00%                0             0
Zhijuan      controller
                             development
             Chen Lue
             Niece
Effect of debts related to   Mr Chen Lue and Ms. Xian Zhijuan provided financial support to the company, will help the company
operation of the             expand their business, improve business performance.


                                                                     23
                                                                     Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Company




5. Other related-party transactions

□ Applicable √ Not applicable
The Company was not Other significant related-party transactions during the reporting period.
VIII. Particulars about the non-operating occupation of funds by the controlling shareholder
and other related parties of the Company
□ Applicable √ Not applicable
The Company was not involved in the non-operating occupation of funds by the controlling shareholder and other
related parties during the reporting period..

IX. Particulars about significant contracts and their fulfillment

I. Particulars about trusteeship, contract and lease

(1) Trusteeship

□ Applicable √ Not applicable

There was no any trusteeship of the Company in the reporting period.

(2) Contract

□ Applicable √ Not applicable

There was no any contract of the Company in the reporting period.

(3) Lease

□ Applicable √ Not applicable
There was not involved in any lease of the Company in the reporting period.

II. Guarantees provided by the company

√Applicable □Not applicable
                                                                                                                 In RMB’0000
                                      External Guarantee (Exclude controlled subsidiaries)
                   Relevant                        Date of                                                            Guarante
                                  Amoun                                                                    Complete
                  disclosure                      happening          Actual                                              e
 Name of the                          t of                                                       Guarante implemen
                  date/No. of                      (Date of         mount of    Guarantee type                           for
  Company                         Guaran                                                          e term    tation
                      the                          signing          guarantee                                         associate
                                      tee                                                                   or not
                  guaranteed                     agreement)                                                              d


                                                               24
                                                                        Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                        amount                                                                                                  parties
                                                                                                                               (Yes or
                                                                                                                                    no)
       Total of external guarantee                                       Total of actual external
                                                                  0                                                                       0
approved in Period(A1)                                                guarantee in Period(A2)
                                                                         Total balance of actual
       Total of external guarantee
                                                                  0       external guarantee at                                           0
approved at Period-end(A3)
                                                                      Period-end(A4)
                                     Guarantee of the Company for the controlling subsidiaries
                                                                                                                               Guarante
                       Relevant                                                                                                      e
                                     Amoun           Date of                                                        Complete
                       disclosure                                                                                                   for
 Name of the                             t         happening            Actual                                      implemen
                      date/No. of                                                      Guarantee         Guarante              associate
  Company                               of           (Date o           mount of                                      tation
                          the                                                              type           e term                    d
  guaranteed                         guarant         signing          guarantee                                           or
                      guaranteed                                                                                                parties
                                        ee         agreement)                                                            not
                        amount                                                                                                 (Yes or
                                                                                                                                    no)
Sino Great                                                                         The joint liability
                 March 15,2016        20,000 March 30,2016                20,000                         1 year     No         No
Wall                                                                               guaranty
Sino Great                                                                         The joint liability
                 March 15,2016        15,000 April 7,2016                 15,000                         1 year     No         No
Wall                                                                               guaranty
Sino Great                                                                         The joint liability
                 March 15,2016         3,000 March 25,2016                 3,000                         1 year     No         No
Wall                                                                               guaranty
Sino Great                                                                         The joint liability
                 March 15,2016        10,000 April 26,2016                10,000                         1 year     No         No
Wall                                                                               guaranty
Sino                                                                               The joint liability
                                      12,000 January 13,2016              12,000                         1 year     No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                      10,000 January 13,2016              10,000                         1 year     No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                      20,000 January 21,2016              20,000                         1 year     No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                      10,000 April 26,2016                10,000                         1 year     No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                      20,000 April 19,2016                20,000                         1 year     No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                      15,000 June 21,2016                 15,000                         1 year     No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                      40,000 June 28,2016                 40,000                         2 years    No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                       2,000 September 29,2015             2,000                         1 year     No         No
International                                                                      guaranty
Sino                                                                               The joint liability
                                       2,000 November 17,2015              2,000                         1 year     No         No
International                                                                      guaranty
Sino                                   5,000 December 16,2015              5,000 The joint liability 1 year         No         No

                                                                25
                                                                              Sino Great Wall Co., Ltd. The Semi-annual Report 2016


International                                                                            guaranty
                                                                           Total of actual guarantee
Total of guarantee for subsidiaries
                                                               500,000 for subsidiaries in the                                        48,000
approved in the Period (B1)
                                                                           Period (B2)
                                                                           Total of actual guarantee
Total of guarantee for subsidiaries
                                                               500,000 for subsidiaries at                                            48,000
approved at Period-end (B3)
                                                                           Period-end (B4)
                                      Guarantee of the Company for the controlling subsidiaries
                                                                                                                                 Guarante
                        Relevant                                                                                                       e
                                      Amoun           Date of                                                         Complete
                     disclosure                                                                                                       for
 Name of the                              t          happening               Actual                                   implemen
                     date/No. of                                                             Guarantee     Guarante              associate
  Company                                of              (Date o            mount of                                   tation
                          the                                                                    type       e term                    d
  guaranteed                          guarant         signing              guarantee                                        or
                     guaranteed                                                                                                   parties
                                         ee         agreement)                                                             not
                        amount                                                                                                   (Yes or
                                                                                                                                      no)
Sino                                                                                     Joint liability
                                        1,000 December 25,2015                   1,000                     1 year     No         No
International                                                                            guaranty
                                                                           Total amount of guarantee to
Total guarantee quota to the
                                                                           the subsidiaries actually
subsidiaries approved in the                                       2,000                                                               1,000
                                                                           incurred in the reporting
reporting period (C1)
                                                                           period (C2)
                                                                           Total balance of actual
Total guarantee quota to the
                                                                           guarantee to the subsidiaries
subsidiaries approved at the end of                                2,000                                                               1,000
                                                                           at the end of the reporting
the reporting period (C3)
                                                                           period (C4)
Total of Company’s guarantee(namely total of the large three aforementioned)
  Total of guarantee in the Period                                         Total of actual guarantee in
                                                               502,000                                                                49,000
(A1+B1+C1)                                                               the Period(A2+B2+C2)
                                                                            Total of actual guarantee at
Total of guarantee at Period-end
                                                               502,000                Period-end                                      49,000
(A3+B3+C3)
                                                                           (A4+B4+C4)
The proportion of the total amount of actually guarantee in thenet
                                                                                                                                  32.41%
assets of the Company(A4+B4+C4)
Including:
Amount of guarantee for shareholders, actual controller and its
                                                                                                                                            0
associated parties(D)
The debts guarantee amount provided for the
Guaranteed parties whose assets-liability ratio exceed                                                                                48,000
70% directly or indirectly(E)
Proportion of total amount of guarantee in net assets of the
                                                                                                                                            0
company exceed 50%(F)
Total guarantee Amount of the abovementioned guarantees
                                                                                                                                            0
(D+E+F)


                                                                     26
                                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Explanations on possibly bearing joint and several
                                                                         None
liquidatingresponsibilities for undue guarantees ( If any)
Explanations on external guarantee against regulated
                                                                         None
procedures(Ifany)
Description of the guarantee with complex method

(1)Illegal providing of external guarantees

□ Applicable √Not applicable

No illegal providing of external guarantees in the report period.

III. Other significant contracts

√Applicable□ Not applicable
There was no other significant contract of the Company in the reporting period.
                                                                                                  Whether
                                                                     Pricin                         the
  Contract the                                                                        The                     Related The report on the
                     Counterpart                                         g                        related
  name of the                        Contract object         Date                  transaction                transacti            final
                    contract name                                    princip                       party
   Company                                                                            price                      on        implementation
                                                                         les                      transacti
                                                                                                       on

                                                                                                                          Geological
Sino Great Wall Haoli                                                Pricin
                                                                                                                          exploration and
International      Consulting       Min apartment      May           g              USD 120
                                                                                                  No          None        overlay has been
Engineering Co., Management         projects           31,2016       agree           million
                                                                                                                          completed, in site
Ltd.               Co., Ltd.                                         ments
                                                                                                                          construction

                                                                                                                          Geological
Sino Great Wall                                                      Pricin
                   MOTTAMA                                                                                                exploration and
International                       MTower Office May                g           USD 80
                   Holdings Co.,                                                                  No          None        overlay has been
Engineering Co.,                     tower project     31,2016       agree million
                   Ltd.                                                                                                   completed, in site
Ltd.                                                                 ments
                                                                                                                          construction

                                                                                                                          Has enter the
Sino Great Wall                                                      Pricin
                   OXLEY-GEM(                                                                                             arena, under
International                                          May           g                USD 285
                   CAMBODIA)C PP50 project                                                        No          None        preparation work
Engineering Co.,                                       31,2016       agree              million
                   O.,LTD.                                                                                                before
Ltd.                                                                 ments
                                                                                                                          construction

                                    BISKRA
Sino Great Wall China                                                Pricin
                                    province                                              MKD                             Under preparation
International       RailwayNo.14                       May           g
                                    HAMMAM                                           4705.0982 No             None        work before
Engineering Co., Bureau Group                          31,2016       agree
                                    SALIHINE                                            million                           construction
Ltd.                Co., Ltd.                                        ments
                                    Hotell

Sino Great Wall Banque              The republic of June             Pricin         USD 300                               Under preparation
                                                                                                  No          None
International      Congolaise de    Congo 5000 sets 29,2016          g                million                             work before



                                                                    27
                                                                         Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Engineering Co., l’Habitat        of modern                        agree                                          construction
Ltd.                               economy                          ments
                                   applicable room
                                   project

                                   The republic of
                                                                                                                   Has enter the
Sino Great Wall                    Congo 5000 sets                  Pricin
                   PT.WANXIAN                                                                                      arena, under
International                      of modern         August         g         RMB 1.5015
                   G NICKEL                                                                    No        None      preparation work
Engineering Co.,                   economy           1,2016         agree            billion
                   INDONESIA                                                                                       before
Ltd.                               applicable room                  ments
                                                                                                                   construction
                                   project


IV. Other significant transactions

□ Applicable √ Not applicable
There was no other significant transaction of the Company in the reporting period.

X.Commitments made by the Company or shareholders holding over 5% of the Company’s shares in the
reporting period or such commitments carried down into the reporting period

√Applicable □ Not applicable
                                                                                                 Time of
                      Commitment                                                                                Peiod of
   Commitment                                                 Contents                           making                      Fulfillment
                          maker                                                                             commitment
                                                                                               commitment
Commitment on
                    No                No                                                       No                           No
share reform
Commitment in
the acquisition
report or the       No                No                                                       No                           No
report on equity
changes
                                      Shares acquired by purchases of assets through
                                      issuing shares: “I will not transfer the new shares
                                      of Victor Onward Holdings acquired through this
                                      restructuring, including but not limited to the
                                      public transfer through the stock market or by
                                      agreement, and I will not entrust anybody else to
Commitments in
                    Chen Lve, He      manage my shares of Victor Onward Holdings,              March                        Strict
assets                                                                                                      36 months
                    Feiyan            within 36 months from the date new shares list           19,2015                       performing
reorganization
                                      and before the date I’ve carried out my
                                      obligations of performance compensation under
                                      this restructuring(subject to whatever is early,
                                      hereinafter referred to as “lock-up periods”). If
                                      the closing price of shares of Victor Onward
                                      Holdings were lower than this issue price for 20


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                                             Sino Great Wall Co., Ltd. The Semi-annual Report 2016


           continuous trading days in 6 months after the
           restructuring transaction has been completed, or
           the final closing price were lower than this issue
           price 6 months after the transaction has been
           completed, the lock-up periods of my shares of
           Victor Onward Holdings are automatically
           prolonged for 6 months. (The above-mentioned
           issue price will be calculated according to the
           price after the adjustment of ex-dividend, etc. if
           ex-dividend behaviors of the company, including
           distribution of dividends, giving bonus,
           conversion of share capital, rationing shares, and
           etc., were happened during the above-mentioned
           periods. If the restructuring transaction were
           March 19,2015 36 mont hs Strict perfor ming
           Shenzhen Victor Onward Textile Industrial Co.,
           Ltd. The Third Quarterly Report 2015. 14
           investigated by judicial authorities or China
           Securities Regulatory Commission due to false
           record, misleading statement or major omission of
           the information provided or disclosed, I will not
           transfer my shares of the company before the
           conclusion of the case has been made clear. After
           the above-mentioned lock-up periods, I will sell
           or transfer the new shares of the company
           acquired from this restructuring following
           relevant regulations of China Securities
           Regulatory commission and Shenzhen Stock
           Exchange.
           Shares acquired by matching funds raised: “I will
           not transfer the new shares of Victor Onward
           Holdings acquired through this issuing by any
           way, including but not limited to the public
                                                                 March                 Strict
Chen Lve   transfer through the stock market or by                         36 months
                                                                 19,2015                performing
           agreement, within 36 months from the date new
           shares list. If regulation rules or regulators have
           longer requirements for lock-up periods, it should
           be executed accordingly.
           Up to the issue day of the letter, I and other
           corporations controlled by me haven’t possessed
           funds of Sino Great Wall; After the transaction is March                    Strict
Chen Lve                                                                   Long-term
           completed, I and other companies controlled by        19,2015                performing
           me (if any), except for listed companies and their
           holding subsidiaries, will not possess the funds of


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                                              Sino Great Wall Co., Ltd. The Semi-annual Report 2016


           listed companies or Sino Great Wall by any way,
           including cash in advance, other expenses, direct
           or indirect loans, assumption, etc. and try our best
           to avoid fund intercourse with listed companies or
           Sino Great Wall, which has nothing to do with
           normal operations. If Sino Great Wall got
           penalized by government administration
           departments due to the money lending which was
           happened before the transaction, I will bear the
           total compensation for the company’s loss
           resulting from it by cash in order to guarantee
           Sino Great Wall won’t suffer any loss.
           Meanwhile, I will actively urge Sino Great Wall
           to establish complete inner control system and
           funds management system within lawful
           authority.
           In view of the fact that the houses rented by Sino
           Great Wall and it’s son subsidiaries, subsidiaries,
           haven’t rental registration, I promise, if Sino
           Great Wall and its son subsidiaries, subsidiaries,     March                 Strict
Chen Lve                                                                    Long-term
           were penalized by real estate management               19,2015                performing
           department or suffered other losses resulting from
           it, I agree to compensate the loss of the company
           by cash.
           During the reporting period, the project which
           Sino Great Wall is involved in is the decoration
           engineering construction project of Libo Grand
           Hotel (hereinafter referred to as “Libo project”)
           which the company contracted before the bidding
           process. Sino Great Wall is not involved in any
           other projects except for Libo project before
           bidding process. As to the violating issues existed
           in the Libo project, I promise as follows: if Sino     March                 Strict
Chen Lve                                                                    Long-term
           Great Wall got penalized by government                 19,2015                performing
           administration departments or suffered any
           economic loss resulted from it, I will compensate
           the company by cash; Meanwhile, I, within lawful
           authority, will also promise to urge the company
           to undertake related construction projects legally
           so as to avoid violating issues happened before
           implementation of bidding process, i.e., at the
           time for construction again.
           “1. Up to October 13th,2014, the related expenses March                     Strict
Chen Lve                                                                    Long-term
           of the litigation and arbitration cases, including     19,2015                performing


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                                              Sino Great Wall Co., Ltd. The Semi-annual Report 2016


           the actual price, compensation, penalty, ligation
           costs, etc. which the parent-subsidiary companies
           of Sino Great Wall needs to pay caused by the
           final results of ligation and arbitration cases,
           exceed the amount of liabilities which recognized
           in the “Audit Report” made for Sino Great Wall
           by Ruihua CPA (Special Ordinary Partnership) on
           the basis of the audit base day of July 31st, 2014,
           I promise to bear the balance by cash
           unconditionally so as to guarantee the
           parent-subsidiaries of Sino Great Wall won’t
           suffer any loss. 2. This commitment letter is
           irrevocable.
           1. On condition that ownership defect exists in the
           lease of house property of parent-subsidiary
           companies of Sino Great Wall and its subsidiary
           corporation, which resulted in inability for
           parent-subsidiary companies of Sino Great Wall
           and its subsidiary corporation to continue leasing
           this house property but having to relocate, or
           parent-subsidiary companies of Sino Great Wall
           and its subsidiary corporation can’t timely find
           suitable workplace for lawful operation in related
           area, I will undertake to compensate by cash for
           parent-subsidiary companies of Sino Great Wall’s
                                                                 March                 Strict
Chen Lve   losses which are caused by operation and finance                Long-term
                                                                 19,2015                performing
           due to the above-mentioned matters. 2. I
           undertake to unconditionally bear the relevant
           fines by cash for parent-subsidiary companies of
           Sino Great Wall on condition that the rental house
           property of parent-subsidiary companies of Sino
           Great Wall and its subsidiary corporation is in
           absence of handling procedures for filing house
           leasing ,which resulted in that parent-subsidiary
           companies of Sino Great Wall and its subsidiary
           corporation are fined by property administrative
           department. 3.The commitment letter is
           irrevocable.
           “In condition that parent-subsidiary companies of
           Sino Great Wall or its son subsidiary haven’t paid
           social security or housing fund for staff according March                   Strict
Chen Lve                                                                   Long-term
           to law, which resulted in any losses to Sino Great 19,2015                   performing
           Wall , including the competent authorities’
           requirement for Sino Great Wall or its subsidiary


                                      31
                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016


           to make supplementary payment, to be punished
           and resourced, I will bear by full-amount cash for
           the fee of supplemental payment and the expense
           and fee for being punished or resourced, which is
           to guarantee Sino Great Wall and its subsidiary to
           avoid suffering from any loss ”.
           “At present, Suzhou Lvbang has possessed one
           state-own land use right, of which the land
           certificate is Suzhou Guo Yong(2014)
           No.Y2014086”, locates in Danan Village, Dadian
           Town, Yongqiao District, Suzhou City with
           32,966 square meters of area and the purpose for
           industry. Suzhou Lvbang possesses its own
           factory with 9,843.87 square meters of area
           above-mentioned, which is the building reserved
           on the former selling land. Suzhou Lvbang is
           carrying out refurnishing and reconstruction for
           this factory and has acquired “License of
           Construction Land Planning ”with
           No.2014-08-001 approved and issued by
           Yongqiao District, Suzhou City’s housing and
                                                                 March                 Strict
Chen Lve   rural construction bureau, of which other                       Long-term
                                                                 19,2015                performing
           examination and approval procedures of
           construction are in the process of handling “I
           undertake to actively supervise and urge Suzhou
           Lvbang on handling procedures of the approval
           process involved with factor refurnishing and
           reconstruction, and which is suffered from
           administrative punishment by relevant competent
           authorities in reason of claiming certificate of
           title, or in which any dispute or controversy exist
           in construction and ownership, which shall be my
           responsibility to carry out solution, and I
           undertake to compensate by cash for Suzhou
           Lvbang’s losses which are due to this matter,
           guaranteeing no losses occur to Sino Great Wall
           and Suzhou Lvbang for this matter.
           “According to the “Agreement of Significant
           Asset Replacement and Issue of Share to Buy
           Asset”(hereinafter referred to as “Agreement”)
                                                                 March                 Strict
Chen Lve   signed among Victor Onward Holdings, all                        Long-term
                                                                 19,2015                performing
           shareholders of Sino Great Wall and Union
           Development Group Co., Ltd (hereinafter referred
           to as“ Union Group”) on October 13, 2014, all the


                                      32
                                                      Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                   creditor’s rights and liabilities related to place-out
                   asset before the delivery date of Victor Onward
                   Holdings shall be Union Group’s responsibility to
                   carry out solution; After the asset delivery date, if
                   any losses occur to Victor Onward Holdings in
                   reason of the liability transfer of asset delivery,
                   personnel placement, unsettled dispute or
                   controversy and other compensation related to
                   place-out asset, payment obligation and
                   punishment, Union Group or the specified third
                   party shall sufficiently compensate all losses for
                   Victor Onward Holdings for the above matters. I
                   undertake, if Union Group and the specified third
                   party refuse to compensate the losses caused by
                   the above mentioned matters for Victor Onward
                   Holdings according to the“ Agreement”, I will
                   compensate by cash for the Victor Onward
                   Company within 5 working day in advance.
                   Meanwhile, I will reserve the resource rights for
                   Union Group and the specified third party “.
                   According to“ Agreement of Shenzhen Victor
                   Onward Textile Industrial Co., Ltd., Chen Lve
                   and He Feiyan Concerning on Performance
                   Compensation” and its supplemental agreement ,
                   Chen Lve’s promised Sino Great Wall that the net
                   profit deducted by incidental losses and
                   attributable to the parent companies’ owners after
Chen Lve, He                                                                 May                     Strict
                   audition of 2015, 2016 and 2017 shall be                              Long-term
Feiyan                                                                       11,2015                  performing
                   respectively more than RMB 345.8 million, RMB
                   438.5 million and RMB 538.2 million. If the net
                   profit of Sino Great Wall is less than the promised
                   net profit mentioned above , Chen Lve and He
                   Feiyan will compensate for listed company in
                   accordance with “Performance Compensation
                   Agreement” and its supplemental agreement
Chen Lve; He       1. This reorganization is planned to place in asset.
Feiyan, Wuxi       At present, complete separation has existed
Hengtai Jiuding    between me or other enterprises under my
Assets             possession (if any) and the listed company in
                                                                             September               Strict
Management         staff, asset, finance, institution and business of                    Long-term
                                                                             30,2015                  performing
Centre             Sino Great Wall. Independence exists in both
(LP);Yantai      staff, asset, finance, institution and business and
Zhaoxuan Yuantai no confusion exists. 2. I undertake, after this
Jiuding Venture    reorganization, to ensure the continued complete


                                               33
                                                      Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Investment Centre separation between me or other enterprises under
(LP);Suzhou      my possession(if any) and the listed company in
Tianyao            staff, asset, finance, institution and business,
Zhongshan          sustaining the independence in the listed
Jiuding            company’s staff, asset, finance, institution and
Investment Centre business, as follows: (1).The Ensurance of
(LP);Jiaxing     Independence for Listed Company’s Personnel
Jiahe Jiuding      Ensure that the general manager, the vice-general
Investment Centre manger, the chief financial officer, the board
(LP);            secretary and the senior executives of the
                   Company only accept salary in listed company,
                   including no holding of any post except director
                   and supervisor in my enterprise or other
                   enterprises under my possession. 2.Ensure the
                   complete independence exists among the listed
                   company’s labor, personnel, and salary
                   management and me. 3. The director, supervisor,
                   general manager and other senior executives
                   recommended by me have all been through the
                   legal procedures, and I will not intervene the
                   company’s board and the shareholder’s decision
                   for appointing and dismissing personnel by
                   exercising official power. (2)The Ensurance of the
                   Asset Independence of Listed Company 1.Ensure
                   that the listed company possesses business system
                   related to operation and the relevant
                   completely-independent asset. 2.Ensure that no
                   occupation of mine exists in capitals and assets of
                   the listed company. 3.The Ensurance of the
                   Financial Independence of Listed Company
                   1.Ensure that the independent finance department
                   and the independent financial calculating system
                   set up by the listed company, which possess
                   normative and independent financial and
                   accounting rules. 2. Ensure that the listed
                   company independently opens a bank account,
                   not sharing the same bank account with me.
                   3.Ensure that the financial staff of the listed
                   company holds no part-time post in my enterprise
                   and other enterprises under my possession. 4.
                   Ensure that the listed company pays taxes
                   according to law. 5. Ensure that the listed
                   company makes the financial decision-making
                   independently, I will not intervene the utilization


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                                                     Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                  of the listed company’s capital. (4)The Ensurance
                  of the Institutional Independence of Listed
                  Company 1.Ensure that the listed company sets
                  up perfect governance structure for the share
                  company’s legal person, which possesses
                  independent and complete institutional framework
                  2.Ensure that the shareholder’s meeting, the board
                  of director, the independent director, the
                  supervisor and the general managers exercise
                  official powers according to laws, regulations and
                  articles of incorporation (5)The Ensurance of the
                  Business Independence of Listed Company 1.
                  Ensure that the listed company possesses the
                  asset, staff, qualification and ability for
                  independently holding business activities, which
                  possesses the independent, autonomous and
                  sustain operation ability catering to the market. 2.
                  Ensure that I will not intervene the listed
                  company’s business activities except exercising
                  shareholder’s rights. 3.Ensure that I or other
                  enterprises under my possession will avoid
                  working on the listed company’s main business
                  which possesses substantial competition. 4.
                  Ensure to reduce the related transaction between
                  me and the listed company or between other
                  enterprises under my possession and the listed
                  company as much as possible; When confirming
                  necessary but unavoidable related transaction, I
                  will ensure the fair operation according to the
                  principle of market culture and the fair price, and
                  fulfill the transaction procedures and the
                  obligation of disclosing information according to
                  relevant laws and regulations and normative
                  document.
Wuxi Hengtai      “Once I or our unit acquire the newly-added share
Jiuding Assets    of Victor Onward Company through this
Management        transaction, no transfers will occur in any way
Centre(LP);     within 12 months from the listing date, including
Yantai Zhaoxuan   but not limited to public transfer by securities       March                 Strict
                                                                                   12 months
Yuantai Jiuding   market or transfer by agreement, and no                19,2015               performing
Venture           entrusting for others to manage my holding share
Investment Centre of Victor Onward Holdings . Once the
(LP);Suzhou     above-mentioned lockup period expires, I will
Tianyao           implement the selling or transferring of the


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                                                       Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Zhongshan           newly-added share of Victor Onward Holdings
Jiuding             according to the relevant provision of CSRC and
Investment Centre SZSE.
(LP); Jiaxing
Jiahe Jiuding
Investment Centre
(LP)
                    “1.Before this reorganization, the fairness and
                    reasonableness of pricing and the legitimacy and
                    effectiveness of decision-making procedure exist
                    in the transaction(if any) between me or the
                    enterprise under my possession(if any) and Sino
                    Great Wall which is planned to place asset in, no
Chen Lve; He        related transaction with obvious unfairness
Feiyan,Wuxi         exists ; 2.After this reorganization, I or the
Hengtai Jiuding     enterprise under my possession will avoid and
Assets              reduce the related transaction with listed company
Management          as much as possible. As for any unavoidable or
Centre(LP);       reasonable related transaction, I or the enterprise
Yantai Zhaoxuan     under my possession will sign the agreement
Yuantai Jiuding     according to laws and fulfill the lawful procedure,
Venture             and fulfill relevant approval procedure for internal
                                                                           March                 Strict
Investment Centre decision-making and timely fulfill the obligation                  Long-term
                                                                           19,2015               performing
(LP);Suzhou       of disclosing information according to law,
Tianyao             following relevant laws, regulations, other
Zhongshan           normative documents and articles of listed
Jiuding             company, which is to guarantee the fairness and
Investment Centre reasonableness in related transaction pricing, to
(LP); Jiaxing     guarantee the fairness of transaction condition and
Jiahe Jiuding       to guarantee not to utilize the related transaction
Investment Centre to illegally transfer the capital and profit of listed
(LP)              company, and not to utilize this transaction to
                    engage in any behaviors which will cause any
                    losses to listed company or other shareholder’s
                    legitimate rights. Once I violate the above
                    promises and cause losses to the listed company, I
                    will compensate the listed company for the losses
                    caused by the this matter.
                    During the assets reorganization, the house
                    property and land without property certificate in
Union
                    the disposed assets within the plant area of Kuixin March                    Strict
Development                                                                          Long-term
                    Community of Kuichong Street of Longgang               19,2015               performing
Group Co., Ltd.
                    District and the expected compensations, as well
                    as the expected compensations concerning to the


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                                                   Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                 regaining of plots planned as schools within the
                 right of land use of Nanyou Industrial Park of
                 Nanshan District have not been recorded in the
                 assessment. Therefore, Union Group promises
                 that after the reorganization, if Union or a third
                 party appointed by Union receives compensations
                 or incomes related toabove-mentioned disposed
                 assets which are house property and land without
                 property certificate as well as regaining of plots
                 planned as schools, Union will return the benefits
                 to Victor Onward Holdings, in 10 working days
                 since the collection. The actual costs and fees
                 during the possession of the house property and
                 land and the paid as well as the unpaid but
                 necessary costs and fees for the reception of the
                 above-mentioned benefits for Union Group or its
                 third party will be deducted from the income. The
                 specific benefits and payable costs and fees
                 should be confirmed jointly by Union Group and
                 Victor Onward Holdings based on the actual
                 situations. (Notes:On June 25, 2015,All
                 shareholders of Victor Onward Holdings, Union
                 Group and Sino Great Wall Signed supplementary
                 agreement, and specified that the land and houses
                 without ownership certificate of Victor Onward
                 Holdings located at the factory area of Kuixin
                 community of Kuichong street office of
                 Longgang district (the land area is about 50,000
                 square meters, the built-up area of houses is about
                 25,000 square meters, among them about 18,000
                 square meters of buildings at built-up area are
                 within the plan of removal and collection of
                 government,hereinafter referred as
                 “undocumented property) still belongs to Victor
                 Onward Holdings. And the benefits and risks of
                 the real estate without certificate are enjoyed and
                 assumed by Victor Onward Holdings.”
                 According to the Term 5.5.3 of Agreement on
                 Major Asset Replacement and Asset Purchase
Union            Through Issuing Shares (hereinafter referred to as
                                                                       March                 Strict
Development      Agreement) signed on October 13, 2014 by the                    Long-term
                                                                       19,2015               performing
Group Co., Ltd   company and all shareholders of Victor Onward
                 Co. Ltd.. and Sino Great Wall, Victor Onward
                 Holdings should obtain the letter of approval


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                                  Sino Great Wall Co., Ltd. The Semi-annual Report 2016


concerning the transferred debts of the disposed
assets from the creditor (including the guarantee,
similarly hereinafter) before the date of assets
delivery. In the situation of debts on Victor
Onward Holdings due to the absence of creditor’s
consent, the company or the third party appointed
by the company is in charge of paying off debts or
reaching agreement on the solution with the
creditor. When there are losses caused by
improper solutions of the company or the third
party appointed by the company, the company or
the third party appointed by the company will
fully compensate for the caused losses of Victor
Onward Holdings in 5 working days after
receiving the notice. According to the Term 5.5.4
of Agreement, after the date of assets delivery,
any compensations, obligations of payment and
penalties caused by disposed assets as well as
unsettled disputes in Victor Onward Holdings will
be undertaken and solved by the company or the
third party appointed by the company, and Victor
Onward Holdings assumes no responsibility.
When there are losses caused by it, the company
or the third party appointed by the company will
fully compensate for the caused losses of Victor
Onward Holdings in 5 working days after
receiving the notice. According to the Term 5.6.1
of Agreement and based on the principle of “staff
arrangement according to the assets”, the labor
relations, social insurance relations including
pension, medical treatment, unemployment,
working injury and maternity, and other liable
welfare and salary of all the staff in Victor
Onward Holdings. (including but not limited to
on-post Shenzhen Victor Onward Textile
Industrial Co., Ltd. The Third Quarterly Report
2015. 25 employees, employees awaiting job
assignments, retired employees, retained
employees with suspend salary, transferred
employees, and temporary employees, etc) will be
transferred to the company or the third party
appointed by the company. Compensations or
related matters (if any) due to the termination of
labor relationship in advance with Victor Onward


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                                                                  Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                                  Holdings, the company or the third party
                                  appointed by the company will be in charge of the
                                  payment. The company promises that for the
                                  losses caused by matters such as the
                                  above-mentioned debt transfers of disposed
                                  assets, personnel arrangement, unsettled disputes,
                                  potential debts, payment obligations and
                                  penalties, the company or the third party
                                  appointed by the company will fully compensate
                                  for the losses of Victor Onward Holdings due to
                                  the above-mentioned matters based on the
                                  Agreement in cash.
Commitments
make in initial
                     No           No                                                         No          No
public offering or
re-financing
Other
commitments for
                     No           No                                                         \No         No
medium and small
shareholders
Completed on
                     Yes
time(Y/N)
If the
commitments is
not fulfilled on
time, shall explain No
the specify reason
and the next work
plan


XI. Particulars about engagement and disengagement of CPAs firm

Whether the semi-annual financial report had been audited?
□ Yes √ No
The semi-annual financial report has not been audited.

XII. Punishment and Rectification

□ Applicable √ Not applicable




                                                            39
                                                                         Sino Great Wall Co., Ltd. The Semi-annual Report 2016


There was no any punishment and rectification of the Company in the reporting period.

XIII. Reveal of the delisting risks of illegal or violation

□ Applicable √ Not applicable
There was no any delisting risk of illegal or violation of the Company in the reporting period.

XIV. Explanation about other significant matters

√ Applicable □Not applicable
  On June 24, 2016, the company published a notice that the company is planning the item of non-public
share-issuing, therefore the trade of the company’s share shall be suspended from June 24, 2016. On July 7, 2016,
the Proposal on the Company’s Non-public A-share Issuance to Specific Objects and the relevant proposals were
examined and approved in the 10th board meeting of the 7th session board of directors, therefore the trade of the
company’s shares shall be restored from July 11, 2016. The Proposals related to the company’s non-public A-share
issuance were examined and approved in the 2016 second extraordinary general shareholder meeting on July 25,
2016.



XV. Issuance of corporate bonds


Whether the company has corporate bonds that have been publicly issued and listed on the stock exchange, and
 not yet due or due but not folly cashed on the approval date of annual report
No.



VI. Change of share capital and shareholding of Principal Shareholders

1.Changes in share capital
                                                                                                                               In shares
                            Before the change                       Increase/decrease(+,-)                   After the Change
                             Amount       Proporti            Bon
                                                     Share           Capitalization of
                                            on                us                         Othe                                Proportio
                                                     allotm          common reserve             Subtotal       Quantity
                                                              shar                        r                                     n
                                                      ent                  fund
                                                               es
I. Share with conditional
                            277,968,976 62.20%                           778,313,133            778,313,133 1,056,282,109     62.20%
subscription
1.State-owned shares                  0     0.00%                                   0                      0
2.Staee-owned legal
                                      0     0.00%                                   0                      0
person shares
3.Other domestic shares     277,968,976 62.20%                           778,313,133            778,313,133 1,056,282,109     62.20%
Of which:Domestic legal
                             99,888,348 22.35%                           279,687,374            279,687,374    379,575,722    22.35%
person shares
Domestic natural person     178,080,628 39.85%                           498,625,758            498,625,758    676,706,386    39.85%


                                                                    40
                                                                Sino Great Wall Co., Ltd. The Semi-annual Report 2016


 shares
 4.Share held by foreign
                                          0   0.00%                      0                 0
 investors
 Of which:Foreign legal
                                          0   0.00%                      0                 0
 person shares
 Foreign natural person
                                          0   0.00%                      0                 0
 shares
 II. Shares with
                                 168,937,606 37.80%            473,025,296        473,025,296   641,962,902   37.80%
 unconditional subscription

 1.Common shares in RMB           99,515,703 22.27%            278,643,968        278,643,968   378,159,671   22.27%

2.Foreign shares in domestic
                                  69,421,903 15.53%            194,381,328        194,381,328   263,803,231   15.53%
             market

 III. Total of capital shares    446,906,582 100.00%          1,251,338,429     1,251,338,429 1,698,245,011 100.00%
Reasons for share changed:
√ Applicable □Not applicable
During the reporting period, upon the base of total share capital of 446,906,582 shares on the date of December 31,
2015, 28 shares were increased for every 10 shares to all the shareholders by converting capital reserve into share
capital, therefore the total increased shares by converting capital reserve into share capital were 1,251,338,429
shares, so the total share capital were 1,698,245,011 shares after such share increasing by converting capital
reserve into share capital.
Approval of Change of Shares
√ Applicable □Not applicable
The company’s 2015 annual share increasing plan by converting capital reserve to share capital was examined and
approved in the 2015 annual general shareholder meeting convened by the company on May 6, 2016.

Ownership transfer of share changes
√ Applicable □Not applicable
In June 2016, the company had implemented the company’s 2015 annual share increasing plan by converting
capital reserve to share capital, and the increased A-shares were directly put into the shareholders’ A-share
securities accounts on June 7, 2016. The increased B-shares were directly put into the shareholders’ B-share
securities accounts on June 13, 2016. When the increased shares were registered, the company’s total share capital
was increased to 1,698,245,011 shares.
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to
common shareholders of Company in latest year and period
√ Applicable □Not applicable
On June 7, 2016, the company implemented the plan of 2015 annual profit distribution and share-increasing by
converting capital reserve to share capital, thus the company’s total share capital was changed to 1,698,245,011
shares from 446,906,582 shares. Based on the total share capital after the increasing, the diluted 2015-annual
earnings per share were RMB 0.2041. The net assets per share attributable to the company’s ordinary shareholders
were RMB 0.75.

Other information necessary to disclose for the company or need to disclosed under requirement from security
regulators

                                                         41
                                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016


□ Applicable √ Not applicable
Explanation on changes in aspect of total shares, shareholders structures as well as structure of assets and liability
of the Company
√ Applicable □Not applicable
After the company’s implementation on the plan of increasing shares by converting capital reserve to share capital,
the company’s total share capital was changed to 1,698,245,011 shares from 446,906,582 shares.

II. Shareholders and actual controlling shareholder

                                                                                                                                    In Shares
                                                                       Total number of preferred
Total number of common
                                                                       shareholders that had restored the
shareholders at the end of the                              54,275                                                                           0
                                                                       voting right at the end of the
reporting period
                                                                       reporting period (if any) (note 8)
                                       Shareholding of shareholders holding more than 5% shares
                                           Proporti                                                                        Number os share
                                             on of     Number of            Changes in   Amount of      Amount of          pledged/frozen
  Shareholders     Nuture of shareholder    shares    shares held at        reporting     restricted    un-restricted State
                                             held      period -end            period     shares held    shares held        of     Amount
                                            (%)                                                                        share
                   Domestic Natural                                                                                      Mortg
Chen Lve                                    34.33%      582,944,556 429,808,094          582,109,696          834,860            431,760,594
                   person                                                                                                age
                   Domestic Non-
Union Holdings
                   State-owned legal         6.79%      115,295,921 72,154,889                          115,295,921
Co., Ltd.
                   person
STYLE-SUCC
                   Foreign legal person      5.47%       92,970,910 68,504,881                              92,970,910
ESS LIMITED
Shanghai
Financial          Domestic Non-
Development        State-owned legal         4.49%       76,300,504 56,221,424             76,300,504
Investment         person
Fund(LP)
                   Domestic Natural
He Feiyan                                    3.23%       54,800,458 40,379,285             54,800,458
                   person
Jiutai Fund-
Bank of
Communication
s-Jiutai
Huitong No.2       Other                     2.50%       42,479,672 31,300,811             42,479,672
specific
customer asset
management
plan
Wuxi Hengtai       Domestic Non-             2.26%       38,330,615 28,243,611             38,330,615


                                                                       42
                                                                          Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Jiuding Assets    State-owned legal
Management        person
Centre(LP)
Foshan Haihui
Heying Venture
                  Domestic Non-
Imvestment
                  State-owned legal          2.25%       38,150,252 28,110,712         38,150,252
Partnership(Lim
                  person
ited
Partnership)
Jiangxi Taihao
                  Domestic Non-
Venture
                  State-owned legal          1.87%       31,791,879 23,425,595         31,791,879
Investment
                  person
Centre(LP)
Yantai
 ZhaoxuanYuan
                  Domestic Non-
 tai Jiuding
                  State-owned legal          1.87%       31,742,745 23,389,391         31,742,745
 Venture
                  person
 Investment
 Centre(LP)
Strategy investors or general legal
person becomes top 10 shareholders due
                                            None
to rights issued (if applicable)See Notes
3)
                                            Chen Lve and He Yanfei are consortium officers; Wuxi Hengtai Jiuding Assets
Explanation on associated relationship      Management Centre (LP)and Yantai Zhaoxuan Yuantai Jiuding Venture Investment
or concerted action of the above            Centre(LP)are consortium officers,The other tradable shareholders neither knew whether
shareholders                                there exists associated relationship between them


                                      Shareholding of top 10 shareholders of unrestricted shares
                                             Quantity of unrestricted shares held at the end of                Share type
          Name of the shareholder
                                                            the reporting period                       Share type           Quantity
Union Holdings Co., Ltd.                                                            115,295,921 RMB Common shares           115,295,921
                                                                                                  Foreign shares placed
STYLE-SUCCESS LIMITED                                                                92,970,910                              92,970,910
                                                                                                  in domestic exchange
                                                                                                  Foreign shares placed
Rich Crown Investment Co., Ltd.                                                      23,235,313                              23,235,313
                                                                                                  in domestic exchange
Liuzhou Jiali Real estate
                                                                                     13,350,040 RMB Common shares            13,350,040
Development Co., ltd.
                                                                                                  Foreign shares placed
Zeng Ying                                                                             6,536,000                               6,536,000
                                                                                                  in domestic exchange
Chanan Fund-China Everbright
                                                                                      6,288,828 RMB Common shares             6,288,828
 Bank-Liu Wenjin
                                                                                                  Foreign shares placed
KGI ASIA LIMITED                                                                      4,991,274                               4,991,274
                                                                                                  in domestic exchange


                                                                   43
                                                                            Sino Great Wall Co., Ltd. The Semi-annual Report 2016


China Galaxy International Securities                                                                Foreign shares placed
                                                                                        3,659,829                                 3,659,829
(Hongkong) Co., Ltd.                                                                                 in domestic exchange
                                                                                                     Foreign shares placed
Song Wenguang                                                                           3,444,966                                 3,444,966
                                                                                                     in domestic exchange
Xingzheng Securities Asset
Management-China Everbright Bank
                                                                                        3,166,110 RMB Common shares               3,166,110
-No.57 collectin of assets management
plan for Xingzheng Securities asset
Explanation on associated relationship
or consistent action among the top 10
shareholders of non-restricted             The controlling shareholder of the above-mentioned largest shareholder Shenzhen Union
negotiable shares and that between the     Holdings Ltd. and third shareholder Rich Crown Investment Co., Ltd.. Is Union
top 10 shareholders of non-restricted      Development Group Ltd.
negotiable shares and top 10
shareholders
Notes to the shareholders involved in
financing securities (if any)(See Notes    None
4)
Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a
buy-back agreement dealing in reporting period.
□ Yes √ No
The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company
have no buy –back agreement dealing in reporting period.

III. Change of the controlling shareholder or the actual controller

Change of the controlling shareholder in the reporting period
□ Applicable √ Not Applicable
There was no any change of the controlling shareholder of the Company in the reporting period.
Change of the actual controller in the reporting period
□ Applicable √ Not applicable
There was no any change of the actual controller of the Company in the reporting period.

IV. Particulars on shareholding increase scheme during the reporting period proposed or implemented by
the shareholders and act-in-concert persons

√ Applicable □Not applicable
Name of shareholder /     The planned             Actual increased
                                                                          Actual increased           The initial date of disclosure of
Name of person acting     increase proportion share-holding
                                                                          shareholding proportion increasing share-holdings plan
in concert                for the stake holding quantity

                                          2.00%               422,200                        0.09%                            July 7, 2015
Chen Lve
Description of other information



                                                                     44
                                                              Sino Great Wall Co., Ltd. The Semi-annual Report 2016


On July 7, 2015, the company disclosed the Announcement on Increasing Share-holding Plan by the Company’s
Potential Actual Controller of Chenlue. On July 7, 2015, the company received a written notice from Mr. Chenlue,
who is confident in the company’s future development based on the understandings of the current capital market
situation and planned, by the means allowed by Shenzhen Stock Exchange((including but not limited to
competitive transaction , block transaction, etc.), to increase the share-holding of the company’s A-shares and/or
B-shares of no more than 2% stake of the company’s total share capital which was based on the total share capital
after the major assets swap and the share issuance to purchase assets. According to the relevant provisions of
Measures for the Administration of the Takeover of Listed Companies, such increased stake shall not be lessened
within 6 months commenced form the date of completion of the stake-holding increasing. As of July 7, 2016, Mr.
Chenlue totally increased his stake-holding of 422,200 shares (Such quantity of the shares was before the
implementation of 2015 annual profit distribution plan, while after the implementation of 2015 annual profit
distribution plan, accordingly such quantity shall be 1,604,360 shares), which accounted for 0.094% of the
company’s total share capital.




                                  VII. Situation of the Preferred Shares


□Applicable √Not applicable
The Company had no preferred shares in the reporting period




                                                        45
                                                                                    Sino Great Wall Co., Ltd. The Semi-annual Report 2016



VIII. Information about Directors, Supervisors and Senior Executives

I. Change in shares held by directors, supervisors and senior executives

√ Applicable □Not applicable
                                                                         Amount of                        Number of Number of
                                                        Amount of
                                                                           shares                         restricted     restricted         Number of
                                       Shares held at     shares                          Shares held
                                                                         decreased                          stock          stock          restricted stock
                             Office    the              increased at                        at the
     Name       Position                                                   at the                         granted at     granted at       granted at the
                             status    year-begin(sh the reporting                        year-ending
                                                                         reporting                           the        the reporting year-ending(sh
                                       are)             period(share                      (share)
                                                                         period(sha                       year-begin period(share              are)
                                                             )
                                                                              re)                           . share)         )
            Board
            chairman,
Chen Lve                   In office    153,136,462 428,782,094                       0 582,944,556                 0                 0                  0
            General
            Manager
Hu
            Director       In office               0                0                 0               0             0                 0                  0
Yongfeng
            Director,D
             eputy
Li Erlong                  In office           3,000             8,400                0        11,400               0                 0                  0
             General
             Manager
            Director,D
Liang       eputy
                           In office               0                0                 0               0             0                 0                  0
Rong        General
            Manager
Wang Lei Director          In office               0                0                 0               0             0                 0                  0
Ban Bin     Director       In office               0                0                 0               0             0                 0                  0
Tang        Independe
                           In office               0                0                 0               0             0                 0                  0
Jianxin     nt Director
Zhang       Independe
                           In office               0                0                 0               0             0                 0                  0
Yufeng      nt Director
Jiang
            Independe
Chonggua                   In office               0                0                 0               0             0                 0                  0
            nt Director
ng
            Chairman
            of the
Dong
            supervisor In office                   0                                  0               0             0                 0                  0
Binggen
            y
            committee
Huang
            Supervisor In office                   0                0                 0               0             0                 0                  0
Shengde
Wu          Supervisor In office                   0                0                 0               0             0                 0                  0



                                                                         46
                                                                        Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Xiaoming
             Deputy
Song
             General       In office            0           0              0             0                  0               0
Chenling
             Manager
Cui Hongli CFO             In office            0           0              0             0      0           0               0
             Secretary
Yang         to the
                           In office            0           0              0             0      0           0               0
Chunling     board of
             directors
Total              --           --     153,139,462 428,790,494             0 582,955,956        0           0               0
II. Changes in directors, supervisors and senior management staffs
□ Applicable √ Not Applicable
Directors, supervisors and senior management staff did not change in the reporting period. For details, see the
2015 annual report.



                                                    IX. Financial Report


1. Audit report

Has this semi-annual report been audited?
□ Yes √ No
The semi-annual financial report has not been audited.

II. Financial statements

Currency unit for the statements in the notes to these financial statements:RMB

1.Consolidated Balance sheet

Prepared by : Sino Great Wall Co., Ltd.
                                                                                                                       In RMB
                   Items                             Year-end balance                        Year-beginning balance
             Current asset:
             Monetary fund                                            1,114,361,163.46                          695,384,561.31
           Settlement provision
Outgoing call loan
  Financial assets measured at fair
value with variations accounted into                                                                              1,102,961.04
current income account
    Derivative financial assets
 Bill receivable                                                       210,891,319.69                           220,448,747.94
 Account receivable                                                   3,162,231,825.59                      2,352,808,087.33



                                                                 47
                                                Sino Great Wall Co., Ltd. The Semi-annual Report 2016


  Prepayments                                  117,820,004.51                          77,707,568.38
 Insurance receivable
Reinsurance receivable
Provisions of Reinsurance contracts
receivable
  Interest receivable
  Dividend receivable
 Other account receivable                      467,579,684.04                         239,952,886.10
 Repurchasing of financial assets
 Inventories                                   245,856,552.73                         168,133,668.91
  Assets held for sales
  Non-current asset due in 1 year               14,020,966.88                          15,717,270.60
  Other current asset                           13,633,979.33                          14,138,411.87
Total of current assets                       5,346,395,496.23                      3,785,394,163.48
Non-current assets:
  Loans and payment on other’s behalf
disbursed
  Disposable financial asset
  Expired investment in possess
 Long-term receivable
 Long term share equity investment
 Property investment
  Fixed assets                                  95,739,662.33                          43,846,215.63
  Construction in progress                        2,101,034.12                         10,016,928.24
Engineering material
  Fixed asset disposal
  Production physical assets
 Gas & petrol
 Intangible assets                             107,478,930.17                           9,267,746.33
 R & D petrol
 Goodwill                                       33,981,631.40                           6,724,316.91
Long-germ expenses to be amortized              36,217,955.33                          18,909,785.69
Differed income tax asset                       59,287,367.87                          47,950,278.07
 Other non-current asset                       100,540,012.47                          95,353,390.28
Total of non-current assets                    435,346,593.69                         232,068,661.15
Total of assets                               5,781,742,089.91                      4,017,462,824.63
Current liabilities
  Short-term loans                            1,786,708,647.08                        225,408,496.07
 Loan from Central Bank
 Deposit received and hold for others
 Call loan received
Financial liabilities measured at fair
value with variations accounted into


                                         48
                                                   Sino Great Wall Co., Ltd. The Semi-annual Report 2016


current income account
     Derivative financial liabilities
  Bill payable                                    314,222,954.89                         143,410,167.17
  Account payable                               1,015,554,995.43                       1,332,619,954.77
 Advance payment                                   73,606,960.67                          64,963,842.60
 Selling of repurchased financial assets
Fees and commissions receivable
 Employees’ wage payable                          23,317,399.59                          12,669,619.20
 Tax payable                                      247,445,787.75                         284,826,290.11
 Interest payable                                   4,210,888.11                             527,969.26
 Dividend payable
  Other account payable                           261,367,548.32                         635,200,976.60
 Reinsurance fee payable
 Insurance contract provision
 Entrusted trading of securities
Entrusted selling of securities
  Liabilities held for sales
Non-current liability due in 1 year                25,175,567.33                           7,135,752.00
Other current liability                            68,823,529.00
Total of current liability                      3,820,434,278.17                       2,706,763,067.78
Non-current liabilities:
  Long-term loan                                  420,458,334.52                          30,140,649.14
 Bond payable
  Including:preferred stock
             Sustainable debt
  Long-term payable
  Long=term payable employees’s
remuneration
 Special payable
 Expected liabilities
     Differed income
  Differed income tax liability                    28,759,092.55                              15,444.16
Other non-current liabilities
Total non-current liabilities                     449,217,427.07                          30,156,093.30
Total of liability                              4,269,651,705.24                       2,736,919,161.08
Owners’ equity
  Share capital                                 1,698,245,011.00                         446,906,582.00
     Other equity instruments
  Including:preferred stock
             Sustainable debt
 Capital reserves                               -1,301,706,291.22                        -50,367,862.22
  Less:Shares in stock
        Other comprehensive income                       -132.50


                                           49
                                                             Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Special reserves                                             74,370,126.02                           46,014,941.54
  Surplus reserves                                           84,394,441.23                           84,394,441.23
 Common risk provision
Undistributed profit                                        959,222,073.64                          755,308,636.19
Total of owner’s equity belong to the
                                                           1,514,525,228.17                       1,282,256,738.74
parent company
Minority shareholders’ equity                                -2,434,843.50                          -1,713,075.19
Total of owners’ equity                                   1,512,090,384.67                       1,280,543,663.55
Total of liabilities and owners’ equity                   5,781,742,089.91                       4,017,462,824.63


Legal Representative: Chen Lve

Person in charge of accounting:Cui Hongli

Accounting Dept Leader: Cui Hongli

2. Balance sheet of Parent Company

                                                                                                              In RMB
                   Items                     Year-end balance                      Year-beginning balance
             Current asset:
             Monetary fund                                  264,417,393.06                          239,145,251.31
 Financial assets measured at fair value
 with variations accounted into current
             income account
       Derivative financial assets
             Bill receivable
           Account receivable                                                                               29,083.30
              Prepayments                                       761,881.82
           Interest receivable
          Dividend receivable
        Other account receivable                           1,304,458,764.96
               Inventories
          Assets held for sales
    Non-current asset due in 1 year
           Other current asset                                  140,807.87
         Total of current assets                           1,569,778,847.71                         239,174,334.61
          Non-current assets:
       Disposable financial asset
     Expired investment in possess
          Long-term receivable
  Long term share equity investment                        3,176,451,536.66                       3,079,451,536.66
          Property investment



                                                      50
                                                Sino Great Wall Co., Ltd. The Semi-annual Report 2016


            Fixed assets                              5,008.00
      Construction in progress
       Engineering material
        Fixed asset disposal
     Production physical assets
            Gas & petrol
          Intangible assets
            R & D petrol
              Goodwill
Long-germ expenses to be amortized              23,234,735.71
     Deferred income tax asset                         382.68                                382.68
      Other non-current asset
    Total of non-current assets               3,199,691,663.05                      3,079,451,919.34

           Total of assets                    4,769,470,510.76                      3,318,626,253.95

         Current liabilities
          Short-term loans                    1,255,000,000.00
Financial liabilities measured at fair
value with variations accounted into
      current income account
   Derivative financial liabilities
            Bill payable
          Account payable
         Advance payment
     Employees’ wage payable                     1,066,439.92
            Tax payable                         97,163,195.11                          98,150,372.30
          Interest payable                        3,150,083.33
         Dividend payable
       Other account payable                       721,700.86                             803,339.56
      Liabilities held for sales
 Non-current liability due in 1 year
       Other current liability
      Total of current liability              1,357,101,419.22                         98,953,711.86
     Non-current liabilities:
          Long-term loan                       200,000,000.00
           Bond payable
    Including:preferred stock
          Sustainable debt
        Long-term payable
     Employees’ wage payable
          Special payable
        Expected liabilities
          Deferred income

   Deferred income tax liability


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                                                            Sino Great Wall Co., Ltd. The Semi-annual Report 2016


      Other non-current liabilities
    Total of Non-current liabilities                     200,000,000.00
            Total of liability                          1,557,101,419.22                             98,953,711.86
            Owners’ equity
              Share capital                             1,698,245,011.00                            446,906,582.00
        Other equity instrument
      Including:preferred stock
            Sustainable debt
            Capital reserves                            1,237,956,472.37                          2,489,294,901.37
         Less:Shares in stock
     Other comprehensive income
            Special reserves
            Surplus reserves                                26,309,287.00                            26,309,287.00
          Undistributed profit                           249,858,321.17                             257,161,771.72
        Total of owners’ equity                        3,212,369,091.54                          3,219,672,542.09
 Total of liabilities and owners’ equity               4,769,470,510.76                          3,318,626,253.95


3.Consolidated Income Statement

                                                                                                            In RMB
                  Items                     Report period                     Same period of the previous year
    I. Income from the key business                     1,953,574,755.51                          2,081,209,219.16
         Incl:Business income                          1,953,574,755.51                          2,081,209,219.16
             Interest income
          Insurance fee earned
     Fee and commission received
          II. Total business cost                       1,662,031,476.57                          1,855,070,717.88
           Incl:Business cost                          1,460,727,131.33                          1,690,684,183.21
             Interest expense
        Fee and commission paid
      Insurance discharge payment
         Net claim amount paid
     Insurance policy dividend paid
     Insurance policy dividend paid
          Reinsurance expenses
       Business tax and surcharge                            9,026,652.11                            44,597,636.60
              Sales expense                                  9,259,264.24                             7,502,905.30
         Administrative expense                           112,993,754.29                             64,838,318.67
           Financial expenses                               70,024,674.60                            17,908,021.84
         Asset impairment loss                              78,527,096.27                            29,539,652.25
 Add:Gains from change of fir value
                                                                                                         25,148.61
             (“-”for loss)
    Investment gain(“-”for loss)                            46,868.49


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                                                   Sino Great Wall Co., Ltd. The Semi-annual Report 2016


  Incl: investment gains from affiliates
 Gains from currency exchange(“-”for
                  loss)
  III. Operational profit(“-”for loss)         213,063,051.16                        226,163,649.89
    Add :Non-operational income                    29,133,269.00                            379,419.84
  Including:Income from disposal of
            non-current assets
      Less:Non business expenses                    2,755,912.00                             33,439.34
Incl:Loss from disposal of non-current
                                                                                              31,839.34
                  assets
       IV.Total profit(“-”for loss)              239,440,408.16                        226,509,630.39
       Less:Income tax expenses                    37,862,759.83                         61,167,289.27
               V. Net profit                       201,577,648.33                        165,342,341.12
 Net profit attributable to the owners of
                                                   202,299,416.64                        165,342,341.12
             parent company
      Minority shareholders’ equity                  -721,768.31
    VI. Other comprehensive income                        -132.50                                  0.00
Net of profit of other comprehensive inco
me attributable to owners of the parent co                -132.50                                  0.00
                  mpany.
(I)Other comprehensive income items
     that will not be reclassified into
      gains/losses in the subsequent
            accounting period
1.Re-measurement of defined benefit pla
  ns of changes in net debt or net assets
2.Other comprehensive income under the
equity method investee can not be reclass
         ified into profit or loss.
(II)
Other comprehensive income that will b                    -132.50                                  0.00
    e reclassified into profit or loss.
1.Other comprehensive income under the
equity method investee can be reclassifie
           d into profit or loss.
2.Gains and losses from changes in fair v
  alue available for sale financial assets
3.Held-to-maturity investments reclassifi
ed to gains and losses of available for sal
             e financial assets
4.The effective portion of cash flow hedg
               es and losses
5.Translation differences in currency fina
                                                          -132.50                                  0.00
             ncial statements
                 6.Other



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7.Net of profit of other comprehensive i
    ncome attributable to Minority                                        0.00                                     0.00
          shareholders’ equity
    VII. Total comprehensive income                          201,577,515.83                           165,342,341.12
Total comprehensive income attributable
                                                             202,299,284.14                           165,342,341.12
   to the owner of the parent company
Total comprehensive income attributable
                                                                -721,768.31
            minority shareholders
           VIII. Earnings per share
        (I)Basic earnings per share                                     0.12                                     0.10
        (II)Diluted earnings per share                                    0.12                                     0.10
The current business combination under common control, the net profits of the combined party before achieved ne
t profit of RMB 198,300,449.93, last period the combined party realized RMB 165,342,341.12.

Legal Representative:Chen Lve

 Person in charge of accounting:Cui Hongli

Accounting Dept Leader: Cui Hongli

4. Income statement of the Parent Company

                                                                                                                In RMB
Items                                       Amount in this period                    Amount in last period
    I. Income from the key business                                 115,940.34                          1,917,380.00
            Incl:Business cost                                           0.00                               168,586.00
        Business tax and surcharge                                                                           149,728.00
               Sales expense
          Administrative expense                              13,785,695.93                             3,135,693.00
             Financial expenses                               19,950,608.66                              -866,617.00
           Asset impairment loss                                     -1,530.70
 Add:Gains from change of fir value
               (“-”for loss)
    Investment gain(“-”for loss)
 Incl: investment gains from affiliates
  II. Operational profit(“-”for loss)                    -33,618,833.55                              -670,010.00
    Add :Non-operational income                              29,071,295.00
 Including:Income from disposal of
             non-current assets
     Less:Non business expenses                               2,755,912.00
Incl:Loss from disposal of non-current
                    assets
        III.Total profit(“-”for loss)                       -7,303,450.55                              -670,010.00
        Less:Income tax expenses
    IV. Net profit(“-”for net loss)                       -7,303,450.55                              -670,010.00

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                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016


V.Net of profit of other comprehensive i
                                                                        0.00                                  40,084.00
                 ncome
(I)Other comprehensive income items
    that will not be reclassified into
                                                                                                              40,084.00
     gains/losses in the subsequent
           accounting period
1.Re-measurement of defined benefit pl
ans of changes in net debt or net assets
2.Other comprehensive income under th
e equity method investee can not be recl
       assified into profit or loss.
                 (II)
Other comprehensive income that will b
    e reclassified into profit or loss.
1.Other comprehensive income under th
e equity method investee can be reclassi
         fied into profit or loss.
2.Gains and losses from changes in fair
value available for sale financial assets
3.Held-to-maturity investments reclassif
ied to gains and losses of available for s
           ale financial assets
4.The effective portion of cash flow hed
             ges and losses


5.Translation differences in currency fin
            ancial statements
                 6.Other
   VI. Total comprehensive income                              -7,303,450.55                              -629,926.00
       VII. Earnings per share:
     (I)Basic earnings per share
     (II)Diluted earnings per share


5. Consolidated Cash flow statement

                                                                                                                In RMB
                  Items                      Amount in this period                    Amount in last period
 I.Cash flows from operating activities
 Cash received from sales of goods or
                                                              805,577,789.73                           878,764,409.16
          rending of services
     Net increase of customer deposits
and capital kept for brother company
Net increase of loans from central bank
Net increase of inter-bank loans from


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                                                     Sino Great Wall Co., Ltd. The Semi-annual Report 2016


other financial bodies
Cash received against original insurance
contract
Net cash received from reinsurance
business
Net increase of client deposit and
investment
  Net increase of amount from disposal
financial assets that measured by fair
value and with variation reckoned into
current gains/losses
  Net increase of inter-bank fund
received
  Net increase of trade financial asset
disposal
  Net increase of repurchasing business
Tax returned                                              3,004.17
Other cash received from business                   339,397,760.63
                                                                                           180,660,797.51
operation
   Sub-total of cash inflow                       1,144,978,554.53                       1,059,425,206.67
Cash paid for purchasing of
                                                  1,158,556,976.75                         988,366,445.02
merchandise and services
Net increase of client trade and advance
Net increase of savings n central bank
and brother company
Cash paid for original contract claim
 Cash paid for interest, processing fee
and commission
 Cash paid for policy dividend
Cash paid to staffs or paid for staffs              101,231,096.05                          69,516,152.17
 Taxes paid                                          86,805,215.28                          53,832,357.06
Other cash paid for business activities           1,055,001,225.65                         191,506,125.25
Sub-total of cash outflow from business
                                                  2,401,594,513.73                       1,303,221,079.50
  activities
Cash flow generated by business
                                                  -1,256,615,959.20                       -243,795,872.83
operation, net
II.Cash flow generated by investing
Cash received from investment
                                                     12,800,000.00
retrieving
Cash received as investment gains                       146,912.79
Net cash retrieved from disposal of
fixed assets, intangible assets, and other                                                      89,678.00
long-term assets



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                                                  Sino Great Wall Co., Ltd. The Semi-annual Report 2016


Net cash received from disposal of
subsidiaries or other operational units
Other investment-related cash received
Sub-total of cash inflow due to
                                                  12,946,912.79                              89,678.00
investment activities
Cash paid for construction of
fixed assets, intangible assets                   16,234,590.65                          16,557,303.16
and other long-term assets
Cash paid as investment
Net increase of loan against pledge
Net cash received from subsidiaries and
                                                  97,000,000.00
other operational units
Other cash paid for investment
                                                                                              3,884.29
activities
Sub-total of cash outflow due to
                                                 113,234,590.65                          16,561,187.45
investment activities
Net cash flow generated by investment           -100,287,677.86                         -16,471,509.45
III.Cash flow generated by financing
Cash received as investment
Incl: Cash received as investment from
minor shareholders
Cash received as loans                          2,195,182,638.00                        348,000,000.00
Cash received from bond placing
Other financing –related ash received           103,516,162.13                         177,282,072.41
Sub-total of cash inflow from financing
                                                2,298,698,800.13                        525,282,072.41
activities
Cash to repay debts                              317,642,499.29                         287,031,864.55
Cash paid as dividend, profit, or
                                                  36,392,124.49                          10,302,041.01
interests
Incl: Dividend and profit paid by
subsidiaries to minor shareholders

                                                561,003,771.39
Other cash paid for financing activities                                                 50,178,511.92



Sub-total of cash outflow due to                915,038,395.17
                                                                                        347,512,417.48
financing activities


                                            1,383,660,404.96
Net cash flow generated by financing                                                    177,769,654.93


IV. Influence of exchange rate
                                                    1,620,952.17                            -41,620.57
alternation on cash and cash equivalents




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                                                                 Sino Great Wall Co., Ltd. The Semi-annual Report 2016



V.Net increase of cash and cash                                 28,377,720.07
                                                                                                         -82,539,347.92
equivalents

Add: balance of cash and cash
                                                                582,743,756.81                           243,759,954.90
equivalents at the beginning of term

VI ..Balance of cash and cash                                 611,121,476.88
                                                                                                         161,220,606.98
equivalents at the end of term



6. Cash flow statement of the Parent Company

                                                                                                                   In RMB
                    Items                    Amount in this period                      Amount in last period
 I.Cash flows from operating activities
 Cash received from sales of goods or
                                                                     139,273.00                            1,917,380.00
           rending of services
                 Tax returned
   Other cash received from business
                                                                578,645,723.03                             2,058,967.00
                  operation
        Sub-total of cash inflow                                578,784,996.03                             3,976,347.00
      Cash paid for purchasing of
       merchandise and services
  Cash paid to staffs or paid for staffs                             132,268.03                                 781,594.00
                 Taxes paid                                       1,313,588.98                                  662,064.00
 Other cash paid for business activities                      1,893,003,110.13                             3,715,030.00
Sub-total of cash outflow from business
                                                              1,894,448,967.14                             5,158,688.00
                   activities
Cash flow generated by business
                                                              -1,315,663,971.11                           -1,182,341.00
operation, net
  II.Cash flow generated by investing
    Cash received from investment
                  retrieving
   Cash received as investment gains
  Net cash retrieved from disposal of
fixed assets, intangible assets, and other
              long-term assets
  Net cash received from disposal of
 subsidiaries or other operational units
Other investment-related cash received
    Sub-total of cash inflow due to
          investment activities
     Cash paid for construction of
     fixed assets, intangible assets
       and other long-term assets

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                                                  Sino Great Wall Co., Ltd. The Semi-annual Report 2016


        Cash paid as investment
Net cash received from subsidiaries and
                                                  97,000,000.00
        other operational units
    Other cash paid for investment
               activities
   Sub-total of cash outflow due to
                                                  97,000,000.00
         investment activities
Net cash flow generated by investment             -97,000,000.00
 III.Cash flow generated by financing
     Cash received as investment
        Cash received as loans                  1,455,000,000.00
    Cash received from bond placing
 Other financing –related ash received
Sub-total of cash inflow from financing
                                                1,455,000,000.00
               activities
          Cash to repay debts
    Cash paid as dividend, profit, or
                                                  17,063,887.14
                interests
Other cash paid for financing activities                    0.00
    Sub-total of cash outflow due to
                                                  17,063,887.14
          financing activities
 Net cash flow generated by financing           1,437,936,112.86
     IV. Influence of exchange rate
alternation on cash and cash equivalents
    V.Net increase of cash and cash
                                                  25,272,141.75                          -1,182,341.00
              equivalents
    Add: balance of cash and cash
                                                 239,145,251.31                           8,480,977.00
  equivalents at the beginning of term
     VI ..Balance of cash and cash
                                                 264,417,393.06                           7,298,636.00
     equivalents at the end of term




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                                                                                                                                                  Sino Great Wall Co., Ltd. The Semi-annual Report 2016
7. Consolidated Statement on Change in Owners’ Equity

Amount in this period
                                                                                                                                                                                                     In RMB
                                                                                                           Amount in this period
                                                                        Owner’s equity Attributable to the Parent Company
                                                 Other Equity
                                                  instrusment                                         Other                                                                        Minor           Total of
            Itme                                                                          Less:                                                    Common
                                                                           Capital                  Comprehen Specialized          Surplus                      Attributable    shareholders’     owners’
                           Share Capital                                                 Shares                                                      risk
                                            preferre Sustain              reserves                     sive        reserve         reserves                        profit          equity           equity
                                                                Other                    in stock                                                  provision
                                            d stock   able                                           Income
                                                      debt
I.Balance at the end of                                                 -50,367,862.2                             46,014,941 84,394,441.2                                                        1,280,543,663
                           446,906,582.00                                                                                                                      755,308,636.19 -1,713,075.19
last year                                                                            2                                    .54                 3                                                               .55
Add: Change of
       accounting policy
Correcting of previous
errors
Merger of entities under
common control
         Other
II.Balance at the
                                                                        -50,367,862.2                             46,014,941 84,394,441.2                                                        1,280,543,663
beginning of current       446,906,582.00                                                                                                                      755,308,636.19 -1,713,075.19
                                                                                     2                                    .54                 3                                                               .55
year
III.Changed in the         1,251,338,429.                               -1,251,338,42                             28,355,184                                                                     231,546,721.1
                                                                                                       -132.50                                                 203,913,437.45    -721,768.31
current year                          00                                         9.00                                     .48                                                                                  2
(1)Total                                                                                                                                                                                       201,577,648.3
                                                                                                                                                               202,299,416.64    -721,768.31
comprehensive income                                                                                                                                                                                           3
(II)Investment or
decreasing of capital by
                                                                                                      60
                                                                   Sino Great Wall Co., Ltd. The Semi-annual Report 2016
owners
1.Ordinary Shares inv
ested by hareholders
2.Holders of other equ
ity instruments invested
capital
3.Amount of shares
paid and accounted as
owners’ equity
4.Other
(III)Profit allotment                                                           165,552.20                 165,552.20
1.Providing of surplus
reserves
 2.Providing of
common risk provisions
3.Allotment to the
owners (or
shareholders)
     4.Other                                                                     165,552.20                 165,552.20
(IV) Internal
                             1,251,338,429.   -1,251,338,42
transferring of owners’
                                        00            9.00
equity
1. Capitalizing of capital
                             1,251,338,429.   -1,251,338,42
reserves (or to capital                                                                                            0.00
                                        00            9.00
shares)
2. Capitalizing of
surplus reserves (or to
capital shares)
3.Making up losses by
surplus reserves.
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                                                                                                                                             Sino Great Wall Co., Ltd. The Semi-annual Report 2016
4. Other
                                                                                                              28,355,184
(V). Special reserves                                                                                                                                                                       28,355,184.48
                                                                                                                        .48
                                                                                                              28,355,184
1. Provided this year                                                                                                                                                                       28,355,184.48
                                                                                                                        .48
2.Used this term
  (VI)Other                                                                                                                                               1,448,468.61
IV. Balance at the end of 1,698,245,011.                              -1,301,706,29                           74,370,126 84,394,441.2                                                       1,512,090,384
                                                                                                    -132.50                                               959,222,073.64 -2,434,843.50
this term                             00                                       1.22                                     .02              3                                                               .67
Amount in last year

                                                                                                                                                                                                In RMB
                                                                                                        Amount in last year
                                                                      Owner’s equity Attributable to the Parent Company
                                                  Other Equity
                                                  instrusment                                     Other                                                                       Minor           Total of
            Items                                                                       Less:                                                 Common
                                           preferr                       Capital                  Compre    Specialized       Surplus                      Attributable    shareholders’     owners’
                           Share Capital             Sustai                            Shares                                                   risk
                                             ed               Other     reserves                  hensive     reserve         reserves                        profit          equity           equity
                                                     nable                             in stock                                               provision
                                           stock                                                  Income
                                                     debt
I.Balance at the end of                                               176,467,549.0                         21,813,200.1 49,347,406.2                                                       761,471,188.4
                           70,136,099.00                                                           -85.60                                                 443,707,019.71
last year                                                                          0                                      0              3                                                                4
Add: Change of
     accounting policy
Correcting of previous
errors
Merger of entities under
common control
         Other
II.Balance at the          70,136,099.00                              176,467,549.0                -85.60 21,813,200.1 49,347,406.2                       443,707,019.71                    761,471,188.4

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                                                           Sino Great Wall Co., Ltd. The Semi-annual Report 2016
beginning of current       0                      0    3                                                     4
year
III.Changed in the                     -12,203,238.7                                              153,139,152.6
                               50.30                                   165,342,341.12
current year                                      5                                                          7
(1)Total
comprehensive income
(II)Investment or
decreasing of capital by
owners
1.Ordinary Shares inv
ested by hareholders
2.Holders of other equ
ity instruments invested
capital
3.Allotment to the
owners (or
shareholders)
       4.Other
                                                                                                  165,342,391.4
(III)Profit allotment        50.30                                   165,342,341.12
                                                                                                             2
1.Providing of surplus
reserves
 2.Providing of
common risk provisions
3.Allotment to the
owners (or
shareholders)
       4.Other                50.30                                   165,342,341.12
(IV) Internal
transferring of owners’
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                                                                                                                                          Sino Great Wall Co., Ltd. The Semi-annual Report 2016
equity
1. Capitalizing of capital
reserves (or to capital
shares)
2. Capitalizing of
surplus reserves (or to
capital shares)
3.Making up losses by
surplus reserves.
4. Other
                                                                                                           -12,203,238.7                                                             -12,203,238.7
(V) Special reserves
                                                                                                                       5                                                                          5
1. Provided this year
                                                                                                           -12,203,238.7
2.Used this term
                                                                                                                       5
  (VI)Other
IV. Balance at the end of                                             176,467,549.0                                        49,347,406.2                                              914,610,341.1
                               70,136,099.00                                                       -35.30 9,609,961.35                                 609,049,360.83
this term                                                                         0                                                   3                                                           1


8. Statement of change in owner’s Equity of the Parent Company

Amount in this period
                                                                                                                                                                                          In RMB
                                                                                                        Amount in this period
                                                    Other Equity instrusment                                               Other
                                                                                                                                    Specializ
            Items                                                                                    Less: Shares in Comprehen                                     Attributable   Total of owners’
                                 Share Capital      preferre                    Capital reserves                                       ed       Surplus reserves
                                                               Sustaina Other                              stock            sive                                      profit           equity
                                                    d stock                                                                         reserve
                                                               ble debt                                                    Income
I.Balance at the end of last
                                   446,906,582.00                               2,489,294,901.37                                                  26,309,287.00 257,161,771.72 3,219,672,542.09
year

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                                                                     Sino Great Wall Co., Ltd. The Semi-annual Report 2016
Add: Change of
       accounting policy
Correcting of previous
errors
         Other
II.Balance at the
                              446,906,582.00    2,489,294,901.37            26,309,287.00 257,161,771.72 3,219,672,542.09
beginning of current year
III.Changed in the current
                             1,251,338,429.00   -1,251,338,429.00                          -7,303,450.55    -7,303,450.55
year
(1)Total comprehensive
                                                                                           -7,303,450.55    -7,303,450.55
income
(II)Investment or
decreasing of capital by
owners
1.Ordinary Shares invest
ed by hareholders
2.Holders of other equit
y instruments invested cap
ital
3.Allotment to the owners
(or shareholders)
 4.Other
(III)Profit allotment
1.Providing of surplus
reserves
2.Allotment to the owners
(or shareholders)
3.Other
(IV)Internal transferring
                             1,251,338,429.00   -1,251,338,429.00                   0.00
of owners’ equity
                                                                65
                                                                                                                                   Sino Great Wall Co., Ltd. The Semi-annual Report 2016
 1. Capitalizing of capital
reserves (or to capital           1,251,338,429.00                             -1,251,338,429.00                                                    0.00
shares)
 2. Capitalizing of surplus
reserves (or to capital
shares)
 3.Making up losses by
surplus reserves.
4. Other
(V) Special reserves
1. Provided this year
2.Used this term
(VI)Other
IV. Balance at the end of
                                  1,698,245,011.00                             1,237,956,472.37                                            26,309,287.00 249,858,321.17 3,212,369,091.54
this term
Amount in last year
                                                                                                                                                                                     In RMB
                                                                                                Amount in last year
                                            Other Equity instrusment
                                                                                                               Other
       Itmes                                                                                 Less: Shares                  Specialized                      Attributable   Total of owners’
                          Share Capital    preferre                      Capital reserves                   Comprehensiv                 Surplus reserves
                                                      Sustaina   Other                         in stock                      reserve                           profit      equity
                                           d stock                                                            e Income
                                                      ble debt
I.Balance at the
                          169,142,356.00                                     31,606,598.00                                                 26,309,287.00 -100,562,791.00      126,495,450.00
end of last year
Add: Change of
     accounting
     policy
Correcting of
previous errors
          Other
II.Balance at the         169,142,356.00                                     31,606,598.00                                                 26,309,287.00 -100,562,791.00      126,495,450.00
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                            Sino Great Wall Co., Ltd. The Semi-annual Report 2016
beginning of
current year
III.Changed in the
                                                    -629,926.00      -629,926.00
current year
(1)Total
comprehensive                                       -629,926.00      -629,926.00
income
(II)Investment or
decreasing of
capital by owners
1.Ordinary Share
s invested by hareh
olders
2.Holders of oth
er equity instrume
nts invested capital
3.Allotment to the
owners (or
shareholders)
     4.Other
(III)Profit
allotment
1.Providing of
surplus reserves
2.Allotment to the
owners (or
shareholders)
3.Other
(IV)Internal
transferring of
                       67
                                                             Sino Great Wall Co., Ltd. The Semi-annual Report 2016
owners’ equity
 1. Capitalizing of
capital reserves (or
to capital shares)
 2. Capitalizing of
surplus reserves
(or to capital
shares)
 3.Making up
losses by surplus
reserves.
4. Other
(V) Special
reserves
1. Provided this
year
2.Used this term
(VI)Other
IV. Balance at the
                       169,142,356.00   31,606,598.00               26,309,287.00 -101,192,717.00   125,865,524.00
end of this term




                                                        68
                                                             Sino Great Wall Co., Ltd. The Semi-annual Report 2016


III.Basic Information of the Company

Sino Great Wall Co., Ltd. (hereinafter referred to as the "Company" or "Sino Great Wall") is formerly known as
Shenzhen Victor Onward Textile Industrial Company Limited which is formerly known as Xinnan Printing and
Dyeing Factory Co., Ltd.. Established in 1980, Xinnan Printing and Dyeing Factory Co., Ltd. is the first wholly
foreign-owned enterprise in Shenzhen. In April 1984, Xinnan Printing and Dyeing Factory Co., Ltd. was changed
into a foreign joint venture and was renamed Shenzhen Victor Onward Printing and Dyeing Co., Ltd.. On
November 19, 1991, approved by the Government of Shenzhen City, Shenzhen Victor Onward Printing and
Dyeing Co., Ltd. was restructured into a joint stock limited company and was renamed Shenzhen Victor Onward
Textile Industrial Company Limited.

Domestic listed RMB ordinary shares ("A" shares; stock code: 000018) and overseas-listed foreign investment
shares ("B" shares; stock code: 200018) issued by the Company were listed for trading on the Shenzhen Stock
Exchange in 1992.

On July 23, 2015, approved by the China Securities Regulatory Commission under the Official Reply to
Approving Shenzhen Victor Onward Textile Industrial Company Limited to Make Major Assets Restructuring and
Issue Shares to Chen Lve and Other Shareholders to Purchase Assets and Raise Supporting Funds (Z.J.X.K. [2015]
No.1774), the Company issued 251,849,593 shares to Chen Lve and other 167shareholders to purchase 100% of
equities of Sino Great Wall International Engineering Co., Ltd. held by them and issued to them 25,914,633
non-public offering shares, which raised funds of RMB 254,999,988.72.

As at September 24, 2015, equities of the listed company were changed to be registered in the name of the
Company. Both parties fully completed the transfer of equities and the relevant formalities of industrial and
commercial registration of changes, so the Company already owned 100% of equities in the listed company.
Meanwhile, according to the Confirmation on Delivery of Exchange-Out Assets, as at the date of delivery (namely
July 31, 2015), all assets and liabilities of the Company had been exchanged out. On September 24, 2015,
Shenzhen Branch of the China Securities Depository and Clearing Corporation Li mited had completed the
relevant securities registration formalities for the above new shares.

On July 29, 2015, the listed company received the new registered capital of RMB 251,849,593 paid by all the
shareholders of Sino Great Wall. Ruihua Certified Public Accountants issued the Verification Report (R.H.Y.Z.
[2015] No.48250011) on July 30, 2015. Registered capital after the change was RMB 420,991,949 and share
capital RMB 420,991,949. On December 4, 2015, Shenzhen Victor Onward Textile Industrial Company Limited.
was renamed Sino Great Wall Co., Ltd..

As at June 30, 2016, total share capital of the Company was 1,698,245,011 shares, in which there were
1,434,441,780 circulating A shares and 263,803,231 circulating B shares. Chen Lve who holds 582,944,556 A
shares, accounting for 34.33% of the total share capital, is the Company's controlling shareholder and actual
controller.

Registered address of the Company: No.26 Kuipeng Road, Baishi Gang, Kuichong Town, Longgang District,
Shenzhen. Legal representative: Chen Lve. The Company falls under textile printing and dyeing industry. The
Company mainly engages in dyeing and printing production, processing and sales of all kinds of pure cotton, pure
linen, polyester cotton, ramie cotton, high-grade blended fabrics and finished garments.

During the reporting period, the company had completed the purchase of Wuhan Commercial & Vocational
Hospital Co.,Ltd and the company shall incorporate it into the consolidated financial statements.

IV.Basis for the preparation of financial statements

1.Basis for the preparation
The company is based on continuous operation, according to the actual transactions and events, in accordance wit
h "Accounting Standards for Enterprises - Basic Standards" issued by the Ministry of Finance and specific corpora
te accounting standards, corporate accounting standards application guide, explained Accounting Standards and ot

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                                                                 Sino Great Wall Co., Ltd. The Semi-annual Report 2016


her regulations (hereinafter referred to as "Enterprise Accounting Standards") are recognized and used to measure,
 on this basis, combined with China Securities Regulatory Commission, "public offering of securities of the Comp
any disclosure Rule No. 15 - financial Reporting general Provisions" (2014 revised) , the financial report was base
d on it.

2. Continuous operation.

The Company since 12 months after the reporting period does not exist on the company's continued viability of si
gnificant concern events or circumstances.

V. Significant accounting policies and accounting estimates
Specific accounting policies and accounting estimates tips:
1. Statement on the Accounting Standard Followed by the Company
The financial statements prepared by the Company comply with the requirements of corporate accounting
standards. They truly and completely reflect the financial situations, operating results, equity changes and cash
flow, and other relevant information of the company.
2.Fiscal Year
The Company adopts the Gregorian calendar year commencing on January 1 and ending on December 31 as the
fiscal year.
The reporting period is from January 1, 2016 to June 30, 2016.
 3.Operating cycle
The Company has an operating cycle of 12 months.
  4. Functional currency

RMB is the currency of the Company and domestic subsidiaries in the primary economic environment. The
functional currency of the Company and domestic subsidiaries is RMB. Currency of the Company in preparing its
financial statements is RMB.
  5. Accounting treatment methods of business combinations under common control and not under common
  control

Business combinations under common control: The assets and liabilities acquired by the Company in business
combinations are measured at the book value of assets and liabilities of the combinee (including the goodwill
arising from the acquisition of the combinee by the ultimate controller) in the consolidated financial statements of
the ultimate controller on the combination date. The stock premium in the capital reserves should be adjusted at
the difference between the book value of the net assets acquired in combinations and that of consideration paid for
the combination (or total par value of shares issued). If the stock premium in the capital reserves is insufficient to
cover the differences, the retained earnings should be adjusted.
Business combinations not under common control: The Company shall, on the acquisition date, measure the assets
surrendered and liabilities incurred or assumed by the Company for a business combination at their fair values.
The Company shall recognize the difference of the combination costs in excess of the fair value of the identifiable
net assets acquired from the acquiree as goodwill. The Company shall recognize the difference of the combination
costs in short of the fair value of the identifiable net assets acquired from the acquiree in the current profit and loss
after review.
Intermediary service charges such as audit fee, legal service fee, appraisal and consultancy fee paid for business
combinations and other directly relevant expenses are included in the current profit and loss when incurred; the
transaction costs for the issuance of equity securities for business combinations shall be used to offset equities.
 6.Preparation method for consolidated financial statements
         1.Scope of consolidation
The scope of consolidation of the consolidated financial statements of the Company is recognized based on the
control and all subsidiaries (including the divisible part of the investee controlled by the Company) shall be
included in the consolidated financial statements.
         2. Procedures for consolidation

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                                                               Sino Great Wall Co., Ltd. The Semi-annual Report 2016


The Company prepares the consolidated financial statements based on its own financial statements and those of its
subsidiaries according to other relevant information. When the Company prepares its consolidated financial
statements, it shall regard the whole enterprise group as an accounting entity to reflect the overall financial
position, operating results and cash flows of the enterprise group according to the requirements for recognition,
measurement and presentation of the relevant accounting standards for business enterprises and the unified
accounting policies.
Accounting policies and accounting periods adopted by all subsidiaries included in the scope of consolidation of
the consolidated financial statements shall be consistent with those of the Company. If accounting policies and
accounting periods adopted by the subsidiaries are inconsistent with those of the Company, in the preparation of
the consolidated financial statements, necessary adjustments shall be made according to the accounting policies
and accounting periods of the Company. For the subsidiaries acquired through business combination not under
common control, adjustments to their financial statements shall be made based on the fair values of net
identifiable assets on the acquisition date. For the subsidiaries acquired through business combination under
common control, adjustments to their financial statements shall be made based on the fair values of their assets
and liabilities (including goodwill from acquisition of the subsidiaries by the ultimate controller) in the financial
statements of the ultimate controller.
The share of owner's equity, net profits and losses in the current year and comprehensive income in the current
year of subsidiaries attributable to minority shareholders should be separately presented under the item "owner's
equity" in the consolidated balance sheet, the item "net profit" and the item "total comprehensive income" in the
consolidated income statement. The difference of the loss in the current year shared by minority shareholders of
the subsidiaries in excess of the share of minority shareholders in the owner's equity at the beginning of the year
of the subsidiaries should be used to offset the minority equity.
(1)Increase in subsidiaries or business
During the reporting period, if the Company increased subsidiaries or business from business combinations under
common control, the beginning balance of the consolidated balance sheet shall be adjusted; the incomes, expenses
and profits from the beginning of the current year of the combinations of the subsidiaries or business to the end of
the reporting period shall be included in the consolidated income statement; cash flows from the beginning of the
current year of the combinations of the subsidiaries or business to the end of the reporting period shall be included
in the consolidated statement of cash flows. Relevant items in the comparative financial statements of the
subsidiaries shall be adjusted accordingly, as if the reporting entity after the business combination exists when the
ultimate controller starts its control.
Where the Company can control the investee under common control due to additional investments and other
reasons, adjustments shall be made as if parties involved in the combination have existed in the current state when
the ultimate controller start its control. Equity investments held before the Company controls the combinee, and
the relevant profit and loss, other comprehensive income and other changes in net assets that are recognized from
the later of the date when the Company obtains the original equity and the date when the combiner and the
combinee are under common control to the combination date, shall be used to offset the retained earnings at the
beginning of the year or the current profit and loss during the period of the comparative statements.
During the reporting period, if the Company increased subsidiaries or business from business combinations not
under common control, the beginning balance in the consolidated balance sheet shall not be adjusted; the incomes,
expenses and profits of the subsidiaries or business from the acquisition date to the end of the reporting period
shall be included in the consolidated income statement; cash flows of the subsidiaries and business from the
acquisition date to the end of the reporting period shall be included in the consolidated statement of cash flows.
Where the Company can implement control over an investee not under common control due to additional
investment or other reasons, the equity held by the combinee before the purchase date is remeasured at the fair
value on the purchase date of the equity, and the difference between the fair value and the book value shall be
included in the current investment income. In the event that the equity of the acquiree held prior to the acquisition
date involves changes to other comprehensive income under the equity method and other changes to owners'
equity except for net profit and loss, other comprehensive income and profit distribution, other comprehensive
income and other changes in the owner's equity associated therewith are transferred to investment income of the
period to which the acquisition date belong, except for other comprehensive income arising from changes in net
liabilities or net assets due to the re-measurement of defined benefits plan by the investee.
(2)Disposal of subsidiaries or business
A .General method of disposal
During the reporting period, if the Company disposes subsidiaries or business, the incomes, expenses and profits
from the subsidiaries or business from the beginning of the year to the disposal date shall be included in the
consolidated income statement; cash flows of the subsidiaries and business from the beginning of the year to the

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disposal date shall be included in the consolidated statement of cash flows.
The difference of total amount of the consideration from disposal of equities plus the fair value of the remaining
equities less the shares calculated at the original shareholding ratio in net assets and goodwill of the original
subsidiary which are continuously calculated as of the acquisition date or combination date is included in the
investment income of the period at the loss of control. Other comprehensive incomes associated with the equity
investments of the original subsidiary, or the changes in owners' equity other than net profit or loss, other
comprehensive income and profit distribution, are transferred into investment income of the period when control
is lost, except for other comprehensive income from the change in net liability or net asset due to the investor's
re-measurement of designated benefit plan.
B .Disposal of subsidiaries by stages
Where the Company disposes the equity investments in subsidiary through multiple transactions and by stages
until it loses the control, if the effect of the disposal on the terms and conditions of all transactions of equity
investments in subsidiary and economic effect meet one or more of the following circumstance, it usually
indicates that the multiple transactions should be accounted for as a package deal:
i. The transactions are concluded at the same time or under the consideration of mutual effect;
ii. The transactions as a whole can reach a complete business result;
iii. The occurrence of a transaction depends on that of at least one other transactions; and/or
iv. A single transaction is uneconomical but it is economical when considered together with other transactions.
Where various transactions of disposal of equity investments in subsidiaries until loss of the control belong
to a package deal, accounting treatment shall be made by the Company on the transactions as a transaction to
dispose subsidiaries and lose the control; however, the difference between each disposal cost and net asset
share in the subsidiaries corresponding to each disposal of investments before loss of the control should be
recognized as other comprehensive income in the consolidated financial statements and should be transferred into
the current profit or loss at the loss of the control.
Where various transactions of disposal of equity investments in subsidiaries until loss of the control do not belong
to a package deal, before the loss of the control, accounting treatment shall be made according to the relevant
policies for partial disposal of equity investments in the subsidiary without losing control; at the loss of the control,
accounting treatment shall be made according to general treatment methods for disposal of subsidiaries.
(3)Purchase of minority equity of subsidiaries
The difference between long-term equity investments acquired by the Company through purchase of minority
interest and the subsidiary’s identifiable net assets attributable to the Company calculated continuously from the
acquisition date (or the combination date) in accordance with the increased shareholding ratio shall be charged
against stock premium within capital reserves in the consolidated balance sheet; when stock premium within
capital reserves is insufficient to offset, the retained earnings shall be adjusted.
(4)      Partial disposal of long-term equity investments in subsidiaries without losing control
The difference between the proceeds from partial disposal of equity investments in the subsidiary and the share of
identifiable net assets of the subsidiary attributable to the Company which are calculated continuously from the
acquisition date (or the combination date) and which are corresponding to the disposal of long-term equity
investments without losing control shall be charged against stock premium within capital reserves in the
consolidated balance sheet; when stock premium within capital reserves is insufficient to offset, the retained
earnings shall be adjusted.


7. Joint venture arrangements classification and Co-operation accounting treatment

8..Recognition Standard of Cash & Cash Equivalents
     The company recognizes its cash in vault & the deposits that are ready for payment at any time as cash when
preparing the cash flow statement.which are featured with short term (expire within 3 months since purchased),
high liquidity, easy to convert to know cash, low in risk of value change, could be recognized as cash equivalents.
   9. Foreign currency transactions and translation of foreign currency statements
         1.Foreign currency transactions
Foreign currency transactions are translated into functional currency at the approximate rate of spot
exchange rate on the day when the transactions occur.
The balance of foreign currency monetary items as at the balance sheet date are translated at the spot
exchange rate on the balance sheet date and the exchange differences arising therefrom shall be included in

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the current profit and loss, except those exchange differences arising from the special borrowings of foreign
currency related to the acquired and constructed assets qualified for capitalization that will be capitalized at
the borrowing expenses.
          2.Translation of foreign currency statements
Assets and liabilities in the balance sheet are translated at the spot exchange rates on balance sheet date;
owners' equity items, except for the item of “undistributed profits”, are translated at the spot exchange rates
on the dates when the transactions occur. The income and expenses items in income statements are translated
at the approximate rate of spot exchange rate prevailing on the date when transactions occur.
Where the Company disposes of an overseas business, it shall transfer the exchange difference relating to the
overseas business to the current profit and loss.
   10. Financial instruments
Financial instruments include financial assets, financial liabilities and equity instruments.
          1.Classification of financial instruments
At the initial recognition, financial assets and financial liabilities are classified as: financial assets or financial
liabilities measured at fair value through current profit and loss, including financial assets or financial liabilities
held for trading (and financial assets or financial liabilities directly designated to be measured at fair value
through current profit and loss); held-to-maturity investments; receivables; available-for-sale financial assets; and
other financial liabilities, etc.
          2.Recognition basis and measurement method of financial instruments
(1)Financial assets (financial liabilities) measured at fair value through current profit and loss
Financial assets (financial liabilities) measured at fair value through current profit and loss are initially recognized
at the fair value upon acquisition (net of cash dividends declared but not yet paid or bond interest due but not yet
received) and the related transaction costs are included in current profit and loss.
The interest or cash dividends to be received during the holding period is or are recognized as investment income.
Change in fair values is included in the current profit and loss at the end of the period.
Difference between the fair value and initial book-entry value is recognized as investment income upon disposal;
meanwhile, adjustment is made to gains or losses from changes in fair values.
(2) Held-to-maturity investments
Held-to-maturity investments are initially recognized at the sum of the fair value (net of bond interest due but not
yet received) and related transaction costs upon acquisition.
The interest income will be calculated and determined according to the amortized cost and effective interest rate
during the holding period and included in investment income. The effective interest rates are determined upon
acquisition and remain unchanged during the expected remaining period, or a shorter period if applicable.
Upon disposal, the difference between the purchase price obtained and the book value of the investment is
recognized in investment income.
(3) Receivables
For creditor’s rights receivable arising from external sales of goods or rendering of service by the Company and
other creditor's rights of other enterprises (excluding liability instruments quoted in an active market) held by the
Company, including accounts receivable and other receivables, the initial recognition amount shall be the contract
price or agreement price receivable from purchasing party. Receivables with financing nature are initially
recognized at their present values.
Upon recovery or disposal, the difference between the purchase price obtained and the book value of the
receivables is recognized in current profit and loss.
(4) Available-for-sale financial assets
Financial assets (financial liabilities) measured at fair value through current profit and loss are initially recognized
at the fair value and related transaction expenses upon acquisition (net of cash dividends declared but not yet paid
or bond interest due but not yet received).
The interest or cash dividends to be received during the holding period is or are recognized as investment income.
The interest or cash dividends should be measured at fair value and their changes in fair value should be included
in other comprehensive income. However, for an equity instrument investment that has no quoted price in an
active market and whose fair value cannot be reliably measured, and for derivative financial asset linked to the
said equity instrument investment and settled by delivery of the same equity instrument, they shall be measured at
cost.
Difference between the proceeds and the book value of the financial assets is recognized as investment income
upon disposal; meanwhile, amount of disposal corresponding to the accumulated change in fair value which is
originally and directly included in other comprehensive income shall be transferred out and recognized as the
current profit and loss.

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(5) Other financial liabilities
They are initially recognized at the sum of the fair value and the associated transaction costs. Other financial
liabilities are subsequently measured at amortized cost.
          3.Recognition and measurement of transfer of financial assets
When a financial assets transfer occurs, the financial assets will be derecognized when substantially all the risks
and rewards on the ownership of the financial assets have been transferred to the transferee; and they will not be
derecognized if substantially all the risks and rewards on the ownership of the financial assets have been retained.
The principle of substance over form is adopted to determine whether a financial asset meets the above
de-recognition conditions for the financial asset. The transfer of a financial asset of the Company is classified into
the entire transfer and the partial transfer of financial asset. Where the entire transfer of the financial asset meets
the de-recognition conditions, the difference of the following two amounts will be included in current profit and
loss:
(1)      The book value of the transferred financial asset;
(2)      The sum of the consideration received from the transfer and the accumulated amount of the changes in fair
value originally and directly included in owners’ equity (the situation where the financial asset transferred is an
available-for-sale financial asset is involved in).
If the partial transfer of financial asset satisfies the criteria for derecognition, the entire book value of the
transferred financial asset shall be split into the derecognized and recognized part according to their respective fair
value and the difference between the amounts of the following two items shall be included in the current profit
and loss:
(1)      The book value of derecognized part;
(2)      The sum of the consideration for the derecognized part and the portion of de-recognition corresponding to
the accumulated amount of the changes in fair value originally and directly included in owners' equity (the
situation where the financial asset transferred is an available-for-sale financial asset is involved in).
If the transfer of a financial asset does not meet the derecognition criteria, the financial asset shall continue to be
recognized, and the consideration received will be recognized as a financial liability.
           4 .Derecognition criteria of financial liabilities
Where the present obligations of financial liabilities have been discharged in whole or in part, the financial
liability is derecognized or any part thereof will be derecognized; if the Company signs an agreement with
creditors to replace the existing financial liabilities by undertaking new financial liabilities, and the new financial
liabilities are substantially different from the existing ones in terms of contract terms, the existing financial
liabilities will be derecognized, and at the same time, the new financial liability will be recognized.
Where substantial revisions are made to some or all of the contractual stipulations of the existing financial liability,
the Company shall derecognize the existing financial liability wholly or partly, and at the same time recognize the
financial liability with revised contractual stipulations as a new financial liability.
Upon whole or partial derecognition of financial liabilities, the difference between the book value of the financial
liabilities derecognized and the consideration paid (including non-cash assets surrendered or new financial
liabilities assumed) shall be included in the current profit and loss.
Where the Company repurchases part of a financial liability, the entire book value of the financial liability shall be
split into the derecognized part and continuously-recognized part according to their respective fair value on the
repurchase date. The difference between the book value allocated to the derecognized part and the considerations
paid (including non-cash assets surrendered and the new financial liabilities assumed) shall be included in the
current profit and loss.
          5 .Recognition method of fair value of financial assets and financial liabilities
Where there is an active market for financial instruments, the fair values shall be recognized at quoted prices in
the active market. Where there is no active market, the fair values shall be recognized with valuation techniques.
At the time of valuation, the Company adopts the techniques that are applicable in the current situation and
supported by enough available data and other information, selects the input values consistent with the features of
assets or liabilities considered by market participants in relevant asset or liability transactions, and gives priority
to using relevant observable inputs. Unobservable inputs are used only under the circumstance when it is
impossible or unobservable inputs to obtain relevant observable inputs.
             6.Test method and accounting treatment of depreciation of financial assets (excluding receivables)
Except for the financial assets measured at fair values through current profit and loss, the book value of financial
assets on the balance sheet date should be checked. If there is objective evidence that a financial asset is impaired,
provision for impairment shall be made.
(1) Provision for impairment of available-for-sale financial assets:
If the fair value of available-for-sale financial assets has significantly declined at the end of the period, or it is

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expected that the trend of decrease in value is non-temporary after considering of various relevant factors, the
impairment shall be recognized, and accumulated losses from decreases in fair value originally and directly
included in owners' equity shall be all transferred out and recognized as impairment loss.
For available-for-sale debt instruments whose impairment losses have been recognized, if their fair values rise in
the subsequent accounting period and such rise is objectively related to the matters occurring after the recognition
of impairment loss, the previously recognized impairment loss shall be reversed and recorded into the current
profit and loss.
Impairment losses on available-for-sale equity instruments should not be reversed through profit and loss.
(2) Provision for impairment of held-to-maturity investments:
Measurement of provision for impairment loss on held-to-maturity investments is treated in accordance with the
measurement method of impairment loss on accounts receivable.

11. Accounts receivable

(1)Accounts receivable with material specific amount and specific provisioned bad debt preparation.
                                                                 The Company recognizes account receivables that are
                                                                 individually significant (more than or equal to RMB 10 million)
Judgment criteria or amount standard of material specific amount
                                                                 and other receivables of a single current entities (more than or
or amount criteria                                               equal to RMB 2 million) as individually significant receivables.


                                                                  On the balance sheet date, the Company separately conducts an
                                                                  impairment test on accounts receivable that are individually
                                                                  significant. Where they are impaired after such test, the
                                                                  impairment loss is recognized at the difference between the
                                                                  present value of its future cash flows lower than the book value
                                                                  and the provision for bad debts shall be made; accounts
Provision method with material specific amount and provision of
                                                                  receivable that are not impaired after the separate test, together
specific bad debt preparation
                                                                  with accounts receivable that are individually insignificant, are
                                                                  divided into several portfolios according to similar credit risk
                                                                  features. The impairment loss is calculated and recognized at a
                                                                  certain percentage of these portfolios of accounts receivable in
                                                                  the balance on the balance sheet date and the provision for bad
                                                                  debts shall be made.



(2)The accounts receivable of bad debt provisions made by credit risk Group
                                Name                                      Method for recognition of impairment allowances
Group of account age                                              The age analysis
Accounts on age basis in the portfolio:
√applicable□ not applicable
                   Age                              Rate for receivables(%)                     Rate for other receivables(%)
Within 1 year(Included 1 year)                                                 5.00%                                          5.00%
1-2 years                                                                      10.00%                                        10.00%
2-3 years                                                                      30.00%                                        30.00%
3-4 years                                                                      50.00%                                        50.00%
4-5 years                                                                      80.00%                                        80.00%
Over 5 years                                                                   100.00%                                        100.00%
Accounts on percentage basis in group:


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□ applicable √not applicable
Accounts on other basis in group:
√applicable□ not applicable
(3)Account receivable with non-material specific amount but specific bad debt preparation
                                                          On the balance sheet date, the Company recognizes impairment
                                                          losses and makes provision for bad debts of other individually
Reason of specific bad debt preparation provision:       significant receivables with signs of impairment at the
                                                          differences of the present values of their future cash flows in
                                                          short of their book values.
                                                          On the balance sheet date, the Company separately conducts an
                                                          impairment test on accounts receivable that are individually
                                                          insignificant but are provided for bad debts on individual basis.
Provision method of bad debt preparation
                                                          Where they are impaired after such test, the impairment losses
                                                          are recognized at the difference between the present value of
                                                          future cash flows lower than the book value and the provision for
                                                          bad debts shall be accordingly made;
       12.Inventories
         1.Classification of inventories
Inventories are classified into: raw materials and engineering construction, etc..
         2.Valuation method of inventories dispatched
The inventories are measured at weighted average method when dispatched.
         3.Recognition basis for net realizable values of inventories of different categories
Net realizable values of merchandise inventories held directly for sale, such as finished goods, stock commodities,
and available-for-sale materials, are measured at the estimated selling prices less estimated sales expenses and
relevant taxes and surcharges in the normal production process. Net realizable values of material inventories
which need further processing are measured at the estimated selling prices less the estimated costs of completion,
estimated sales expenses and relevant taxes and surcharges in the normal production process. Net realizable values
of inventories held for the purpose of fulfillment of sales contracts or service contracts are calculated on the basis
of the contract prices; if the quantity of inventories held exceeds that stated in the contract, the net realizable
values of the excessive part are calculated on the basis of normal selling prices.
The provisions for inventory depreciation reserve are made on an individual basis at the end of the period, for
inventories with large quantities and relatively low unit prices, the provisions for inventory depreciation reserve
are made on a category basis. For inventories related to the product portfolios manufactured and sold in the same
area, and of which the final usage or purpose is identical or similar thereto, and which is difficult to be separated
from other items for measurement purposes, the provisions for inventory depreciation reserve are made on a
portfolio basis.
Except that there is clear evidence that the market price is abnormal on the balance sheet date, the net realizable
value of inventory items shall be recognized at the market price on the balance sheet date.
Net realizable value of inventory items at the end of the year is recognized at the market price on the balance sheet
date.
4. Inventory system
Perpetual inventory system is adopted.
         5.Amortization methods for low-cost consumables and packaging materials
(1)     One-off amortization method is adopted for low-cost consumables;
(2)     One-off amortization method is adopted for packaging materials.
13. Classified as the assets held for sale
1. Recognition criteria for the classification of the assets held for sale
    The company will recognize the combination parts of the enterprise (or non-current assets) which
simultaneously meet the following requirements, as the components of the assets held for sale.




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(1) The components should be immediately sold under the current condition only according to the usual terms of
the parts sold.
(2) The enterprise has made resolution for the disposal of the components, the approval of shareholders’ meeting
or relevant authority agency if the shareholder’s approval is requested by the rules.
(3) The enterprise has signed the irrevocable transfer agreement with the transferee.
(4) The transfer shall be completed within one year.


14.Long-term equity investment
          1.Standards for joint control and significant influence
The term ‘common control’ refers to the joint control, according to the relevant provisions, over an arrangement,
of which the relevant activities should be agreed and decided by the participants that share the control. Where the
Company and other investors exert common joint control over the investee and the Company is entitled to net
assets of the investee, the investee is the joint venture of the Company.
Significant influence refers to the power to participate in making decisions on the financial and operating policies
of an enterprise, but not the power to control, or jointly control, the formulation of such policies with other parties.
Where the Company is able to exert significant influence over the investee, the investee is its associate.
          2.Recognition of initial investment costs
(1) Long-term equity investments acquired from business combination
Business combination under the same control: if the Company makes payment in cash, transfers non-cash assets
or bears debts and issues equity securities as the consideration for the business combination, the book value of the
owner's equity of the acquiree in the consolidated financial statements of the ultimate controller is recognized as
the initial cost of the long-term equity investment on the combination date. In case the Company can exercise
control over the investee under common control for additional investment or other reasons, the initial investment
cost of long-term equity investments is recognized at the share of book value of net asset of the acquiree after the
combination in the consolidated financial statements of the ultimate controller on the combination date. The stock
premium should be adjusted at the difference between the initial investment cost of long-term equity investments
on the combination date and the book value of long-term equity investments before the combination plus the book
value of consideration paid for additional shares; if there is no sufficient stock premium for write-downs, the
retained earnings are adjusted.
Business combination not under common control: The Company recognizes the combination cost determined on
the combination date as the initial cost of long-term equity investments. Where the Company can control the
investee not under common control from additional investments, the initial investment cost should be changed to
be accounted for under the cost method and recognized at the sum of the book value of equity investments
originally held and newly increased investment cost.
(2) Long-term equity investment acquired by other means
For a long-term equity investment acquired through making payments in cash, its initial cost is the actually paid
purchase cost.
For a long-term equity investment acquired from issuance of equity securities, its initial cost is the fair value of
the issued equity securities.
If the exchange of non-monetary assets has commercial substance and the fair values of assets traded out and
traded in can be measured reliably, the initial cost of long-term equity investment traded in with non-monetary
assets are determined based on the fair values of the assets traded out and the relevant taxes and surcharges
payable unless there is any conclusive evidence that the fair values of the assets traded in are more reliable; if the
exchange of non-monetary assets does not meet the above criteria, the book value of the assets traded out and the
relevant taxes and surcharges payable are recognized as the initial cost of long-term equity investment traded in.
For a long-term equity investment acquired from debt restructuring, its initial cost is determined based on the fair
value.
          3.Subsequent measurement and recognition of gains and losses
(1) Long-term equity investments accounted for under the cost method
Long-term equity investments in subsidiaries are accounted for under the cost method. Except for the actual price
paid for acquisition of investment or the cash dividends or profits contained in the consideration which have been
declared but not yet distributed, the Company recognizes the investment income in the current year at the cash
dividends or profits declared by the investee.
(2) Long-term equity investments accounted for under the equity method


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Long-term equity investments in associates and joint ventures are accounted for under the equity method. If the
cost of initial investment is in excess of the proportion of the fair value of the net identifiable assets in the investee
when the investment is made, the difference will not be adjusted to the initial cost of the long-term equity
investments; if the cost of initial investment is in short of the proportion of the fair value of the net identifiable
assets in the investee when the investment is made, the difference will be included in the current profit and loss.
The Company shall recognize the investment income and other comprehensive income at the shares of net profit
and loss and other comprehensive income realized by the investee which the Company shall enjoy or bear and
adjust the book value of long-term equity investments at the same time; the Company shall calculate the shares
according to profits or cash dividends declared by the investee and correspondingly reduce the book value of
long-term equity investments; the book value of long-term equity investments shall be adjusted according to the
investee's other changes in owner's equity other than net profit and loss, other comprehensive income and profit
distribution, which should be included in owner's equity.
The share of the investee's net profit or loss should be recognized after adjustments are made to net profit of the
investee based on the fair value of identifiable net assets of the investee upon acquisition of investments and
according to accounting policies and accounting period of the Company. When holding the investment, the
investee should prepare the consolidated financial statements, it shall account for the investment income based on
the net profit, other comprehensive income and the changes in other owner's equity attributable to the investee.

The Company shall write off the part of incomes from internal unrealized transactions between the Company and
associates and joint ventures which are attributable to the Company according to the corresponding ratio and
recognize the profit and loss on investments on such basis. Where the losses from internal transactions between
the Company and the investee fall into the scope of assets impairment loss, the full amount of such losses should
be recognized. For transactions on investments or sales of assets between the Company and associates and joint
ventures, where such assets constitute business, they should be accounted for according to the relevant policies
disclosed in this note "Accounting treatment of business combinations under common control and not under
common control" and "Preparation of consolidated financial statements".
When the Company recognizes its share of loss incurred to the investee, treatment shall be done in following
sequence: firstly, the book value of the long-term equity investment shall be reduced. Secondly, where the book
value thereof is insufficient to cover the share of losses, investment losses are recognized to the extent of book
value of other long-term equities which form net investment in the investee in substance and the book value of
long term receivables shall be reduced. Finally, after all the above treatments, if the Company is still responsible
for any additional liability in accordance with the provisions stipulated in the investment contracts or agreements,
provisions are recognized and included into current investment loss according to the obligations estimated to
undertake.
(3) Disposal of long-term equity investments
For disposal of long-term equity investments, the difference between the book value and the actual price shall be
included in the current investment income.
For long-term equity investments accounted for under the equity method, when the Company disposes such
investments, accounting treatment should be made to the part that is originally included in other comprehensive
income according to the corresponding proportion by using the same basis for the investee to directly dispose the
relevant assets or liabilities. Owner's equity recognized at the changes in the investee's other owner's equity other
than net profit or loss, other comprehensive income and profit distribution shall be transferred to the current profit
and loss according to the proportion, except for other comprehensive income from changes arising from
re-measurement of net liabilities or net assets of defined benefit plan.
In case the joint control or significant influence over the investee is lost for disposing part of equity investments or
other reasons, the remaining equity will be changed to be accounted for according to the recognition and
measurement principles of financial instruments. The difference between the fair value and the book value on the
date of the loss of joint control or significant influence should be included in the current profit and loss. For other
comprehensive income recognized from accounting of the original equity investments under the equity method,
accounting treatment should be made by using the same basis for the investee to directly dispose the relevant
assets or liabilities when the equity method is no longer adopted. Owner's equity recognized from the investee's
changes in other owner's equity other than net profit or loss, other comprehensive income and profit distribution
should all transferred to the current profit and loss when the equity method confirmed is no longer adopted.
Where the Company loses the control over the investee due to disposal of partial equity investments or other
reasons, when it prepares individual financial statements, if the remaining equity after disposal can exercise joint

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control or significant influence on the investee, such investments should be changed to be accounted for under the
equity method and the remaining equity should be deemed to have be adjusted on acquisition, namely when the
equity method is adopted for accounting; if the remaining equity after disposal can exercise joint control or
significant influence on the investee, such equity will be changed to be accounted for according to recognition and
measurement standards of financial instruments and the difference between fair value and book value on the date
of loss of the control or significant influence should be included in the current profit and loss.
Where equity after the disposal is acquired from business combinations due to additional investments or other
reasons, when the Company prepares individual financial statements, if the remaining equity after the disposal is
accounted for under the cost method or equity method, other comprehensive income and other owners' equity
recognized from equity investments that are held before the acquisition date and are accounted for under the
equity method should be carried forward in proportion; if the remaining equity after the disposal is changed to be
accounted for according to recognition and measurement standards of financial instruments, other comprehensive
income and other owners' equity should be carried forward at full amount.
15. Investment real estate
The measurement mode of investment property
Not applicable
16.Fixed assets

(1)Confirmation conditions
    Fixed assets refer to physical assets owned for purpose of production, service providing, leasing or
management, and operation with service life of more than one year. Fixed assets are recognized when all of the
following conditions are satisfied:(1)Financial benefits attached to the fixed asset is possibly inflowing to the
Company;(2) The cost of the fixed asset can be reliable measured.

(2)Depreciation method


                                                      Evpected useful    Estinated residual value   Annual depreciation rat
         Type            Depreciation method
                                                          life(Year)             rate                            e(%)
House and Building     Straight-line method    20                        5                          4.75
Machinery and
                       Straight-line method    10                        5                          9.5
equipment
Transportation
                       Straight-line method    7                         5                          13.57
equipment
Electronic
equipment and other                            3-5                       5                          19.00-31.67
equipment           Straight-line method

(3)Cognizance evidence and pricing method of financial leasing fixed assets
The fixed assets acquired under financing lease are recognized if one of the following conditions is specified by
the Company and the leaser in their lease agreement:
(1) Upon the expiration of the lease term, the ownership of the leased asset has been transferred to the Company;
(2) The Company has the option to purchase the asset and the purchase price is far lower than the asset’s fair
value at the time of the option being exercised;
(3) The lease term covers the most of the useful life of the leased asset;
(4) The present value of the minimum payment by the Company on the lease commencement date is almost equal
to the asset’s fair value.
On the lease commencement date, the book entry value of a fixed asset acquired under financing lease is
measured at the asset’s fair value or the present value of the minimum lease payment, whichever is the lower. The
minimum lease payment is recorded as the book entry value of the long-term payables, and the difference between
them is deemed as the unrecognized financing expenses.
   17.Construction in process


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Projects under construction are recorded as fixed assets at necessary expenditures incurred before preparing the
asset to reach the condition for its intended use. For construction in progress that has reached working condition
for intended use but for which the completion of settlement has not been handled, it shall be transferred into fixed
assets at the estimated value according to the project budget, construction price or actual cost, etc. from the date
when it reaches the working condition for intended use and the fixed assets shall be depreciated in accordance
with the Company’s policy for fixed asset depreciation; adjustment shall be made to the estimated value based on
the actual cost after the completion of settlement is handled, but depreciation already provided for will not be
adjusted.
   18.Borrowing costs
          1.Recognition principles of capitalization of borrowing costs
Borrowing costs include the interest of borrowings, the amortization of discount or premium, auxiliary expenses,
exchange differences incurred by foreign currency borrowings, etc.
The borrowing costs incurred to the Company and directly attributable to the acquisition and construction or
production of assets eligible for capitalization should be capitalized and recorded into asset costs; other borrowing
costs should be recognized as costs according to the amount incurred and be included into current profit and loss.
Assets eligible for capitalization refer to fixed assets, investment property, inventories and other assets which may
reach their intended use or sale status only after long-time acquisition and construction or production activities.
Borrowing costs may be capitalized only when all the following conditions are met at the same time:
(1) Asset disbursements, which include those incurred by cash payment, the transfer of non-cash assets or the
undertaking of interest-bearing debts for acquiring and constructing or producing assets eligible for capitalization,
have already been incurred;
(2) Borrowing costs have already been incurred;
(3) The acquisition and construction or production activities which are necessary to prepare the assets for their
intended use or sale have already been started.
          2.Capitalization period of borrowing costs
Capitalization period refers to the period from commencement of capitalization of borrowing costs to its
cessation; period of suspension for capitalization is excluded.
Capitalization of borrowing costs should cease when the acquired and constructed or produced assets eligible for
capitalization have reached the working condition for their intended use or sale.
When some projects among the acquired and constructed or produced assets eligible for capitalization are
completed and can be used separately, the capitalization of borrowing costs of such projects should be ceased.
If all parts of the acquired and constructed or produced assets are completed but the assets cannot be used or sold
externally until overall completion, the capitalization of borrowing costs should be ceased at the time of overall
completion of the said assets.
          3.Period of capitalization suspension
If the acquisition and construction or production activities of assets eligible for capitalization are abnormally
interrupted and such condition lasts for more than three months, the capitalization of borrowing costs should be
suspended; if the interruption is necessary procedures for the acquired, constructed or produced assets eligible for
capitalization to reach the working conditions for its intended use or sale, the borrowing costs continue to be
capitalized. Borrowing costs incurred during the interruption are recognized as the current profit and loss and
continue to be capitalized until the acquisition, construction or production of the asset restarts.
          4.Measurement of capitalization rate and capitalized amounts of borrowing costs
As for special borrowings borrowed for acquiring and constructing or producing assets eligible for capitalization,
borrowing costs of special borrowing actually incurred in the current period less the interest income of the
borrowings unused and deposited in bank or return on temporary investment should be recognized as the
capitalization amount of borrowing costs.




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As for general borrowings used for acquiring and constructing or producing assets eligible for capitalization, the
interest of general borrowings to be capitalized should be calculated by multiplying the weighted average of asset
disbursements of the part of accumulated asset disbursements exceeding special borrowings by the capitalization
rate of used general borrowings. The capitalization rate is calculated by weighted average interest rate of general
borrowings.

19.Biological Assets

None

20.Oil & gas assets

None
21..Intangible assets
(1) Valuation method, service life and impairment test
         1.Measurement method of intangible assets
(1) The Company initially measures intangible assets at cost on acquisition;
The cost of an externally acquired intangible asset comprises its purchase price, related taxes and surcharges and
any other directly attributable expenditure of preparing the asset for its intended use. If the deferred payment of
purchase price of intangible assets exceeding normal credit terms is substantially of financial nature, the cost of
intangible assets should be determined at the present value of the purchase price.
The intangible assets acquired and used by the debtor to repay debt in debt restructuring should be recorded at the
fair value of the intangible assets. The difference between the book value of restructured debts and the fair value
of intangible assets used to repay debt should be included in the current profit and loss.
On the premise that non-monetary assets trade is of commercial nature and the fair value of the assets traded in or
out can be measured reliably, the intangible assets traded in with non-monetary assets should be recognized at the
fair value of the assets traded out, unless any unambiguous evidence indicates that the fair value of the assets
traded in is more reliable; as to the non-monetary assets trade not meeting the aforesaid premise, the book value of
the assets traded out and related taxes and surcharges payable should be recognized as the cost of the intangible
assets, with gains or losses not recognized.
(2) Subsequent measurement
The useful lives of intangible assets are analyzed on acquisition.
For intangible assets with definite useful lives, the Company shall adopt the straight-line method for amortization
within the period during which they can bring economic benefits to the Company; where the period during which
they can bring economic benefits to the Company cannot be forecast, those intangible assets shall be deemed as
assets with indefinite lives and no amortization will be made.
         2.Estimate of useful life of intangible assets with limited useful life:

                                               Estimated useful
                         Item                                                    Basis
                                                    lives
        Land use right                             50 years           Land use certificate
                                                        5 years       By reference to the same
          software                                                    industry
The useful life and amortization method of intangible assets with limited useful lives should be reviewed.
After review, the useful life of intangible assets and amortization method at the end of the year are not different
from previous estimates.
         3.Specific criteria for classification of research phase and development phase
Research phase: the phase for the creative and planned investigation and research to acquire and understand new
scientific or technological knowledge.
Development stage: the phase for the application of research achievements and other knowledge to a certain plan
or design, prior to the commercial production or use, so as to produce any new material, device or product, or
substantially improved material, device and product.

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Expenditure of an internal research and development project on the research phase shall be included in current
profit and loss when it occurs.
           4.Specific criteria for capitalization of expenditures at the development phase
Expenditure on the development phase of an internal research and development project shall be recognized as
intangible assets only when the following conditions are simultaneously satisfied:
(1) It is feasible technically to finish intangible assets for use or sale;
  (2) It is intended to finish and use or sell the intangible asset;
(3) The ways whereby the intangible asset is to generate economic benefits, including those whereby it is able
prove that there is a potential market for the products manufactured by applying this intangible asset or that there
is a potential market for the intangible asset itself; if the intangible asset will be used internally, its usefulness shall
be proved;
(4) It is able to finish the development of the intangible assets, and able to use or sell the intangible assets, with
the support of sufficient technologies, financial resources and other resources; and
(5) The expenditure attributable to the intangible asset during its development phase can be measured reliably.
     22.Impairment of long-term assets
For the long-term equity investments, investment property, fixed assets, construction in progress, intangible assets,
and other long-term assets measured at cost model, if there are signs of impairment, an impairment test will be
conducted on the balance sheet date. If the recoverable amount of the asset is less than its book value after test,
assets impairment provision will be made at the difference and included into impairment loss. The recoverable
amount is determined at the higher of the net of the fair value less disposal costs and the present value of the
expected future cash flows. The assets impairment provision is calculated and made on an individual basis. If it is
difficult for the Company to estimate the recoverable amount of the individual asset, the recoverable amount of an
asset group to which the said asset belongs to will be determined. Asset group is the smallest asset group that can
independently generate cash inflows.
For goodwill, impairment test shall be conducted at least in the end of each year.
The Company conducts an impairment test for the goodwill. The book value of goodwill arising from business
combinations is amortized to relevant asset groups with a reasonable method from the date of acquisition; or
amortized to relevant combination of asset groups if it is difficult to be amortized to relevant asset groups. When
the book value of goodwill is amortized to the relevant assets group or combination of assets groups, it shall be
evenly amortized according to the proportion of the fair value of each assets group or combination of assets
groups in the total fair value of the relevant assets groups or combinations of assets groups. Where the fair value
cannot be reliably measured, it should be amortized according to the proportion of the book value of each asset
group or combination of assets groups in the total book value of assets groups or combinations of assets groups.
When making an impairment test on the relevant assets groups or combination of assets groups containing
goodwill, if any indication shows that the assets groups or combinations of assets groups may be impaired, the
Company shall first conduct an impairment test on the assets groups or combinations of assets groups not
containing goodwill, calculate the recoverable amount and compare it with the relevant book value to recognize
the corresponding impairment loss. Then the Company shall conduct an impairment test on the assets groups or
combinations of assets groups containing goodwill, and compare the book value of these assets groups or
combinations of assets groups (including the book value of the goodwill apportioned thereto) with the recoverable
amount. Where the recoverable amount of the relevant assets groups or combinations of assets groups is lower
than the book value thereof, the Company shall recognize the impairment loss of the goodwill.

The above losses from asset impairment shall not be reversed in subsequent accounting periods once recognized.
    23.Long-term deferred expenses
         Long-term deferred expenses refer to various expenses which have been already incurred but will be born
         in this period and in the future with an amortization period of over 1 year.
         1.Amortization method
Long-term deferred expenses are amortized evenly over the beneficial period.
          2.Amortization years
The amortization period is determined in accordance with the contract or expected beneficial period.
      24.Employee compensation
         1.Accounting treatment of short-term compensation
During the accounting period of an employee' providing services for the Company, the Company should recognize
the short-term compensation actually incurred as liabilities and include it in the current profit and loss or the
relevant asset costs.
During the accounting period when employees serve the Company, the corresponding amount of employee


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compensation is calculated and determined according to the provision basis and provision proportion as stipulated
in the provisions on the social insurance premiums and housing funds paid for employees by the Company, as
well as trade union funds and employee education funds.
If the employee benefits are of non-monetary, they are measured at fair value if they can be reliably measured.
          2.Accounting treatment of post-employment benefits
Defined contribution plans
The Company pays basic endowment insurance and unemployment insurance for employees according to the
relevant provisions of the local government, calculate payables according to payment base and proportion
specified by the local government and recognizes them as liabilities, and includes them into the current profit and
loss or the relevant asset costs.
          3.Accounting treatment of dismissal benefits
The Company recognizes the employee compensation arising from dismissal benefits as liabilities and include it
in the current profit and loss when the Company cannot unilaterally withdraw dismissal benefits which are
provided for termination of labor relation plan or layoff proposal, or when the Company recognizes costs or
expenses (which is earlier) associated with restructuring of payment of dismissal benefits.
(4) Accounting methods for other long-term employee benefits
     25. Estimated liabilities
          1.Recognition criteria for estimated liabilities
Where all the following conditions are met simultaneously for any obligation pertinent to any contingency
including litigation, debt guarantee, onerous contract and reorganization, the Company will recognize such
contingency as estimated liabilities:
(1) The obligation is a present obligation of the Company;
(2) The performance of such obligation is likely to result in outflow of economic benefits from the Company;
and
(3) The amount of the obligation can be measured reliably.
          2.Measurement of estimated liabilities
Estimated liabilities of the Company is initially measured as the best estimate of expenses required for the
performance of the relevant present obligations.
When the Company determines the best estimate, it should have a comprehensive consideration of risks with
respect to contingencies, uncertainties and the time value of money. If the time value of money is significant, the
best estimate shall be determined after discounting the relevant future outflow of cash.
The best estimate shall be accounted as follows in different circumstances:
If there is continuous range (or interval) for the necessary expenses, and probabilities of occurrence of all the
outcomes within this range are equal, the best estimate shall be determined at the average amount of upper and
lower limits within the range.
If there is no continuous range (or interval) for the necessary expenses, or probabilities of occurrence of all the
outcomes within this range are unequal although such a range exists, in case that the contingency involves a single
item, the best estimate shall be determined at the most likely outcome; if the contingency involves two or more
items, the best estimate should be determined according to all the possible outcomes with their relevant
probabilities.
When all or some of the expenses necessary for the liquidation of estimated liabilities of the Company are
expected to be compensated by a third party, the compensation should be separately recognized as an asset only
when it is virtually certain that the reimbursement will be obtained. The amount recognized for the reimbursement
should not exceed the book value of estimated liabilities.

       26.Share-based payments
The Company's share-based payments are transactions in which the Company grants equity instruments or
undertakes equity-instrument-based liabilities in return for services from employees [or other parties]. The
share-based payments of the Company consist of equity-settled share-based payments and cash-settled
share-based payments.
Where equity-settled share-based payments are exchanged for providing services by employees, their fair values
are measured at those of employees’ equity instruments. Where the Company makes share-based payments in
restricted stocks and the employee makes capital contributions to subscribe such shares, such shares should not be
circulated or transferred before they reach unlocked conditions and before they are unlocked; if the unlocked
conditions specified in the final equity incentive plan fail to be reached, then the Company should repurchase the
shares at the price agreed in advance. When the Company received the payment of the employee for the
subscription of restricted stocks, it should recognize share capital and capital reserves (share premiums) in

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accordance with the payment for subscription received. The Company should fully recognize a liability at the
repurchase obligations and recognize treasury stock at the same time. On each balance sheet date within the
vesting period, the Company will, based on the newly-acquired subsequent information such as the changes in the
number of the vested employees and whether the specified performance is reached, make the best estimate on the
number of the vesting equity instruments. On such basis, the services received in the current period should be
included in the relevant cost or expenses according to fair value on the date of grant and capital reserves should be
accordingly increased. No adjustments should be made to the recognized relevant costs or expenses and total
owners' equity after the vesting date. However, when the right can be exercised immediately after the grant, it
should be included in the relevant costs or expenses at the fair value on the date of grant. The capital reserves
should be increased accordingly.
For share-based payments finally failing to be exercised, costs or expenses should not be recognized, unless the
conditions for vesting are market conditions or non-vesting conditions. At this time, whether market conditions or
non-vesting conditions are met or not, it is deemed to have vesting rights if non-market conditions in all the
vesting conditions are met.
If the terms of the equity-settled share-based payments were modified, the services received should be recognized
at least in accordance with the terms of the unmodified terms. Moreover, the modification of fair value of equity
instruments granted from any increase, or beneficial changes to the employee on the modification date should be
recognized as increases in services obtained.
If the equity-settled share-based payments were cancelled, they should be handled as accelerated exercise of rights
on the date of cancellation and the amount that is not yet recognized should be immediately recognized. Where
employees or other parties could choose to meet non-vesting conditions but failed to meet the conditions in the
vesting period, they should be handed as cancelling the equity-settled share-based payments. But, if new equity
instruments were granted and such new equity instruments granted are recognized to be used to replace the
cancelled equity instruments on the date of grant of new equity instruments, then the alternative equity
instruments for granted should be handled in the way same as the revision to terms and conditions on handling the
original equity instruments.
27. Preferred shares, perpetual capital securities and other financial instruments
  28.Revenue
          1.General recognition principles for revenues from sales of goods:
(1)      The Company has transferred significant risks and rewards of ownership of the goods to the buyer;
(2)      The Company retains neither continuing managerial involvement to the degree usually associated with
ownership nor effective control over the goods sold;
(3)      The amount of revenues can be measured reliably;
(4)      The related economic benefits are likely to flow into the Company;
(5)      The costs incurred or to be incurred in respect of the transaction can be measured reliably.
          2 .Specific principles
(1) Revenues from rendering of services
Revenues from rendering of services of the Company mainly refer to revenues from engineering design. If the
outcome of transactions can be estimated reliably, revenues shall be recognized at the important timing specified
in the design contract. That is to say, revenues shall be recognized at the percentage of workload of completed
design at the important timing in total design workload and expected recoverable contract amount.
Where the outcome of transactions on rendering of services cannot be reliably estimated, the revenues from
rendering of services shall be recognized at labor costs that have been incurred and that are expected to be
compensated. The labor costs that have been incurred are recognized as the expenses in the current period. Labor
costs that have been incurred but that are not expected to be compensated shall not be recognized as revenues.
When contracts or agreements of the Company concluded with other enterprises include sales of goods and
rendering of services, if the part of sales of goods and that of rendering of services can be distinguished and be
separately measured, they shall be treated separately; if the part of sales of goods and that of rendering of services
cannot be distinguished or can be distinguished but cannot be separately measured, the whole contract shall be
treated as sales of goods.
(2) Revenues from construction contracts
If the outcome of a construction contract can be reliably estimated, the revenues and costs from the construction
contract shall be recognized at the percentage of completion method on the balance sheet date. The percentage of
completion of the contract is recognized at the percentage of the accumulated contract costs actually incurred in
the estimated total costs.
Note: Calculation formula


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Where the outcome of a construction contract cannot be estimated reliably, if contract costs are not expected to be
recoverable, contract revenue is recognized to the extent of actual contract costs that are expected to be
recoverable and the contract costs are recognized as contract expenses immediately when incurred. If contract
costs are not expected to be recoverable, they are recognized as expenses immediately when incurred and contract
revenue is not recognized. When uncertainties that make the outcome of a construction contract unable to be
estimated reliably do not exist, revenues and costs associated with construction contracts should be recognized
with the completion percentage method.
If the estimated total contract costs exceed the estimated total contract revenue, the expected loss is recognized as
current expenses.
Accumulated cost incurred and accumulative gross profit (loss) recognized as well as settled payments of the
construction contract should be presented at the net amount after the offset in the balance sheet. The part of
accumulated cost incurred plus accumulative gross profit (loss) recognized exceeding settled payments of the
construction contract should be presented as inventories; the part of accumulated cost incurred plus accumulative
gross profit (loss) recognized in short of settled payments of the construction contract should be presented as
advances from customers.
(3)Hospital income
Hospital income comes mainly from outpatient and inpatient, affirm income time when patients finished
settlement.Income from outpatient service, because in the patient of outpatient treatment, do not need to be
hospitalized, is a short treatment time, the clinic will be in the hospital after the settlement, pay treatment and is
expended, affirm income financial on the day after receipt of the money.
Resident income, because the hospital patients need to be in the hospital treatment for a period of time, when the
hospital new prepaid a part of the medical model, the first not affirm income. At discharge, the settlement of the
hospitalization medical treatment, the patient draw up invoices for the hospital to the patient, the financial confirm
the income of hospital patients.
     29.Government subsidies
(1)Basis and accounting methods for assets related government subsidies
           1.Type
Government subsidies are monetary assets and non-monetary assets freely obtained by the Company from the
government. They are divided into government subsidies related to assets and government subsidies related to
income.
Government subsidies related to assets refer to government subsidies which are acquired by the Company for
construction or form long-term assets in other ways, including the financial allocation for purchasing fixed assets
or intangible assets, the financial discount for special loan of fixed assets and others. Government subsidies
related to income refer to government subsidies other than government subsidies related to assets.
          2.Timing of recognition
If a government subsidy is a monetary asset, it shall be measured in the light of the amount received or receivable.
If a government subsidy is a non-monetary asset, it shall be measured at its fair value; and if its fair value cannot
be obtained in a reliable way, it shall be measured at a nominal amount. Government subsidies measured at the
nominal amount are directly included in the current profit or loss.
          3.Accounting treatment
For asset-related government grants, the Company will recognize them as deferred income, and include them in
non-operating income according to the useful lives of the related assets constructed or acquired;
if government subsidies related to income are used to compensate the Company’s relevant expenses or losses in
future periods, such government subsidies should be recognized as deferred income on acquisition and be
included in the current profit and loss during the period of recognition of the relevant expenses; if government
subsidies related to income are used to compensate the Company’s relevant expenses or losses incurred, such
government subsidies are directly included into the current profit and loss on acquisition.
     30. Deferred income tax assets and deferred income tax liabilities
Deferred income tax assets are recognized at deductible temporary differences to the extent that it shall not exceed
the taxable income probably obtained in future period to be against the deductible temporary difference. For
deductible losses and tax credits that can be carried forward to subsequent periods, deferred tax assets arising
therefrom are recognized to the extent that future taxable income will be probable to be available against
deductible losses and tax credits.
Taxable temporary differences are recognized as deferred income tax liabilities except in special circumstances.


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Such special circumstances include: the initial recognized of goodwill; other transactions or events that are not a
business combination and affect neither accounting profit nor taxable profit (tax loss).
If the Company has the legal right of netting and intends to settle in net amount or to obtain assets and discharge
liabilities simultaneously, the current income tax assets and current income tax liabilities of the Company shall be
presented based on the net amount after offset.
When the Company has the legal right for netting of current income tax assets and current income tax liabilities
and the income tax assets and income tax liabilities are related to the income tax levied on the same taxpayer by
the same tax administrative department or are related to different taxpayers but, within each future period of
reversal of important income tax assets and income tax liabilities, the taxpayers involved intend to settle current
income tax assets and current income tax liabilities or acquire assets and liquidate liabilities at the same time, the
Company's income tax assets and income tax liabilities shall be presented at the net amount after the offset.
     31.Leases
           1.Accounting treatment of operating leases
(1) The Company's rental expenses paid for leased assets shall, within the whole lease term excluding the
rent-free period, be amortized with the straight-line method and included in current expenses. Initial direct costs
related to lease transactions paid by the Company shall be included in the current expenses.
When assets lessor bears costs related to the lease borne by the Company, the Company shall deduct the part of
expenses from the total rents and amortize the rents after deduction over the lease term and include them in
current expenses.
(2) The Company's rental expenses collected for leased assets shall, within the whole lease term excluding the
rent-free period, be amortized with the straight-line method and recognized as the relevant rental income. Initial
direct cost associated with leasing transactions paid by the Company should be included in the current cost; the
cost of large amount shall be capitalized and included by stages in the current income according to the same base
recognized at the income related to leasing over the whole leasing period.
When the Company bears costs related to the lease borne by the leasee, the Company shall deduct te part of
expenses from the total rents and amortize the rents after deduction over the lease term.
          2.Accounting treatment of finance leases
(1) Assets acquired under finance leases: at the inception of the leases, the Company shall recognize the
book-entry value of leased assets at the lower of their fair values or their present values of the minimum lease
payments, and shall recognize the book-entry value of long-term payables at the amounts of the minimum lease
payments, and shall recognize the differences between the above two book-entry values as unrecognized financing
charges. Under the effective interest method, the Company amortizes the unrecognized financing charges over the
lease term and includes them in the financial expenses. The Company records the initial direct expenses in the
values of leased assets.
(2) Assets leased under finance leases: On the lease beginning date, the Company recognizes the difference of
finance leasing receivables plus unguaranteed residual value and their present value as unrealized financing
income and recognized the unrealized financing income as rental income in each period when the rents will be
received in the future. The initial direct expenses of the Company related to lease are included into the initial
measurement of financing lease payment receivable, and the income recognized in lease period is decreased
accordingly.
□Applicable √Not applicable

32. Other significant accounting policies and estimates
(1)Change of main accounting policies
None

(2)Change of main accounting estimations

None

33.Change of main accounting policies and estimations

(1)Change of main accounting policies
None

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                                                                        Sino Great Wall Co., Ltd. The Semi-annual Report 2016


(2)Change of main accounting estimations

None

34.Other

VI.Taxation

1.Main categories and rates of taxes

                Tax type                                    Tax basis                                 Tax rate(%)
                                           The output tax is calculated based on
                                           taxable income in accordance with tax
                                           laws, and value added tax payable should
VAT                                                                                     11、36
                                           be the balance of the output tax after
                                           deducting the deductible input tax for the
                                           current year
                                           Calculated and paid at taxable operating
                                                                                        3、5
Business tax                               income
                                           Calculated and paid at business tax,
                                           value-added tax and consumption tax          1、5、7
Urban maintenance and construction tax     actually paid
Enterprise income tax                      Calculated and paid at taxable income        15、25
In case there exist any taxpayer paying corporate income tax at different tax rates, disclose the information
                        Name of taxpayer                                                 Income tax rates


2.Tax preferences

(1)According to the provisions of the Circular of the State Administration of Taxation on Issuing the Tentative
Measures for the Collection and Administration of Income Tax on Enterprises That Have Operations in Different
Regions and That Pay Taxes in a Consolidated Manner (G.S.F. [2008] No. 28) issued on March 10, 2008, for
business institutions and establishments without the status of a legal person that are established in different
regions within the territory of China, namely those engaging in production and operating activities in different
regions, their head offices (parent companies) are enterprises that pay taxes in a consolidated manner. The parent
company pays taxes in a consolidated manner. The parent company pays taxes in a consolidated manner. Head
office and branches prepay enterprise income tax in installment, 50% of which is shared by all branches and 50%
of which is prepaid by the head office. Branches share the prepayments in the proportion of 35%, 35% and 30% of
operating income, employee compensation and total assets; final settlement of annual enterprise income tax shall
be made by the parent company at the tax authority and will no longer be allocated to branches.
(2)The Company's subsidiaries Sino Great Wall Group Co., Limited (hereinafter referred to as "Sino Hong
Kong") and Inrich Me Engineering Co., Limited (hereinafter referred to as "Inrich Me Engineering") are
enterprises established in the Hong Kong Special Administrative Region and are subject to enterprise profit tax at
the rate of 16.5%; Sino Great Wall International Engineering (MACAU) Co., Limited (hereinafter referred to as
"Sino Macau") is en enterprise established in the Macao Special Administrative Region and is subject to
complementary income tax at the progressive rate.
(3)The Company's wholly-owned subsidiary Sino Great Wall International Engineering Co., Ltd. (hereinafter
referred to as "Sino International") obtained the high-tech enterprise certificate (No. GR201511003125) jointly
approved and issued by Beijing Municipal Science and Technology Commission, Beijing Municipal Finance
Bureau, Beijing Municipal Office, SAT and Beijing Local Taxation Bureau on November 24, 2015. The certificate
was issued on November 24, 2015 and valid for 3 years, so Sino International would pay enterprise income tax at


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                                                                       Sino Great Wall Co., Ltd. The Semi-annual Report 2016


the rate of 15% in 2015, 2016 and 2017.
(4) According to the Notice of Ministry of Finance and State Administration of Taxation on Full Implementation
of Replacing the Business Tax with the VAT, the company’s wholly-owned subsidiary-Wuhan Commercial &
Vocational Hospital Co.,Ltd shall enjoy the preferential policy with VAT exemption from May 1, 2016.

3.Other

        VII. Notes to the major items of consolidated financial statement

1.Monetary funds
                                                                                                                       In RMB
                   Items                                  Year-end balance                    Year-beginning balance
Cash on hand                                                                 1,421,081.59                        1,349,587.20
Bank deposit                                                           523,011,174.45                         343,390,159.56
Other monetary capital                                                 589,928,907.42                         350,644,814.55
Total                                                                 1,114,361,163.46                        695,384,561.31
Including: Total amount deposited abroad                                64,361,377.79                          60,170,773.67
 2. Financial assets measured at fair value through current profit and loss
                                                                                                                       In RMB
                             Items                                Year-end balance            Year-beginning balance
Financial assets measured at fair value through current profit
                                                                                       0                         1,102,961.04
and loss
Total                                                                                  0                         1,102,961.04


3.Derivative financial assets

□ Applicable √ Not applicable


4.Note receivables

(1)Classification Note receivable

                                                                                                                       In RMB
                   Items                                  Year-end balance                    Year-beginning balance

Bank acceptance bill                                                          891,520.48                         4,040,251.87

Commercial acceptance bill                                             209,999,799.21                         216,408,496.07

Total                                                                  210,891,319.69                         220,448,747.94


(2) Notes receivable pledged by the Company at the period-end

                                                                                                                       In RMB
                                  Items                                                     Amount


            (3)Notes receivable endorsed or discounted by the Company as at June 30,2016 but not expired on
            the balance sheet date

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                                                                         Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                                                                                                                                  In RMB
                                                                                               Amount underecognized as at June 30,
                       Item                    Amount derecognized as at June 30, 2016
                                                                                                             2016
Bank acceptance bill                                                         20,601,564.61

Commercial acceptance bill                                                                                                 107,157,999.08

Total                                                                        20,601,564.61                                 107,157,999.08
5. Account receivable
        (1).Classification account receivables.
                                                                                                                                  In RMB
                                         Amount in year-end                                        Amount in year- begin
                              Book Balance     Bad debt provision                Book Balance          Bad debt provision
        Category                                                     Book
                          Amount Proportio Amount Proportio                     Amount Proportio Amount Proportion( Book value
                                                                     value
                                      n(%)                n(%)                              n(%)                    %)
Receivables subject
                                                                                2,638,7
to provision for bad      3,535,94             373,709,             3,162,231                         285,934,0               2,352,808,0
                                     100.00%              10.57%                42,183. 100.00%                     10.84%
debts on credit risk      0,852.18               026.59               ,825.59                             96.56                      87.33
                                                                                     89
characteristics basis
                                                                                2,638,7
                          3,535,94             373,709,             3,162,231                         285,934,0               2,352,808,0
Total                                                                           42,183.
                          0,852.18               026.59               ,825.59                             96.56                      87.33
                                                                                     89
Receivable accounts with large amount individually and bad debt provisions were provided
□Applicable √Not applicable
Account reveivable on which bad debt proisions are provided on age basis in the group
√ Applicable □ not applicable
                                                                                                                                  In RMB
                                                                          Amount in year-end
               Aging
                                         Account receivable                  Bad debt provision                Rate of alloance(%)
Within item 1 year
Within 1 year                                     2,320,366,583.60                    148,165,313.55                               5.00%
1-2 years                                           838,376,994.69                        83,837,699.47                           10.00%
2-3 years                                           260,707,518.15                        78,212,255.45                           30.00%
3-4 years                                           102,177,573.37                        51,088,786.69                           50.00%
4-5 years                                             9,536,054.65                         7,628,843.72                           80.00%
Over 5 years                                          4,776,127.72                         4,776,127.71                         100.00%
Total                                             3,535,940,852.18                    373,709,026.59
Notes:


(2)Bad debt provision accrual collected or switch back

Bad debt provision accrual was RMB58,627,821.32 ; The acmount collected or switches back amounting to
 37,413,023.19.




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                                                                           Sino Great Wall Co., Ltd. The Semi-annual Report 2016


(3)The current accounts receivable write-offs situation

                                                                                                                                  In RMB
                               Items                                                         Amount written off


Account receivables actually written-off during the reporting period:
                                                                                                                                  In RMB
                        Nature of account                               Reason for written      Verification       Arising from related
        Name                                  Amount written off
                           receivables                                         -off              procedures         transactions (Y/N)
Explanation for write-off of account receivables:



(4)The ending balance of other receivables owed by the imputation of the top five parties

                                                                                  Amount in year-end
                       Name
                                                  Account receivable                  Proportion(%)            Bad debt provision
    China Harbour Engineering Company Ltd.                492,333,328.54                              14.73           24,616,666.43
    China Water Conservancy & Hydropower                  310,280,223.17                               8.95           15,514,011.16
    Second Engineering Bureau Co., Ltd.
    Zhong Ya Group                                        232,270,000.92                               7.14           11,613,500.05
    Oxley Diamond (Cambo                                  209,683,175.54                               6.35           10,484,158.78
    Henan No.1 Thermal Power Construction                 178,865,404.63                               5.51            8,943,270.23
    Co., Ltd.
                       Total                            1,423,432,132.80                              42.67           71,171,606.64
(5) Account receivable which terminate the recognition owning to the transfer of the financial assets
(6) The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts
receivable
Other notes:

6.Prepayments

(1)Age analysis

                                                                                                                                  In RMB
                                             Year-end balance                                    Year-beginning balance
            Aging
                                   Amount                   Proportion                       Amount                  Proportion
Within 1 year                          109,659,061.20                      93.07%             70,146,608.20                    90.27%
1-2 years                                5,273,833.77                       4.50%               5,258,018.08                      6.77%
2-3 years                                1,681,622.82                       1.40%               1,090,606.22                      1.40%
Over 3 years                             1,205,486.72                       1.03%               1,212,335.88                      1.56%
Total                                  117,820,004.51              --                         77,707,568.38               --
Notes of the reasons of the prepayment ages over 1 year with significant amount but failed settled in time::



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                                                                        Sino Great Wall Co., Ltd. The Semi-annual Report 2016


(2)The ending balance of Prepayments owed by the imputation of the top five parties

                        Name                                 Balance in year-end                           Proportion

Shenzhen Qianhai Yifang Supply chain                                       45,000,000.00                                        38.43
 Management Co., Ltd.
DANCO For Building Materials Co.                                           14,892,674.54                                        12.72
Kaiyuan(Tianjing)Building materials Sales Co.,                            2,972,088.60                                         2.54
Ltd.
ABB LLC QATAR                                                               2,712,624.20                                         2.32
TIANJIN TEXTILE GROUP IMPORT AND                                            2,206,750.71                                         1.88
EXPORT INC.
                        Total                                              67,784,138.05                                        57.89
Other notes:

7.Interest receivable

None


8.Dividend receivable

None


9.Other receivable

(1)Disclosure of calassification of other receivables

                                                                                                                  In RMB

                                      Amount in year-end                                        Amount in year-begin
                                                Amount in                      Amount in
                        Amount in year-end                                                         Amount in year-begin
        Category                                year-begin         Book            year-end
                                                                                                                          Book value
                        Amount Proportio Amount Proportio          value   Amount Proportio Amount Proportion(
                                    n(%)                n(%)                             n(%)                   %)
Other receivables
provided bad debt       510,129,             42,550,0            467,579,6 261,942                21,989,49               239,952,88
                                   100.00%              8.34%                            99.82%                  8.39%
provision in credit       746.12               62.09                  84.03 ,379.50                    3.40                     6.10
risk groups
Other account
receivable with
                                                                           478,000                478,000.0
minor individual                                                                         0.18%                 100.00%
                                                                                   .00                    0
amount but bad debt
provision is provided
Total                   510,129,             42,550,0            467,579,6 262,420 100.00% 22,467,49             8.56% 239,952,88


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                                                                        Sino Great Wall Co., Ltd. The Semi-annual Report 2016


                            746.12              62.09                 84.03 ,379.50                   3.40                      6.10
Other receivable accounts with large amount and were provided had debt provisions individually at end of period.
□Applicable √Not applicable
Other receivable accounts in Group on which bad debt provisions were provided on age analyze basis:
√Applicable □Not applicable
                                                                                                                            In RMB
                                                                           Amount in year-end
               Aging
                                          Other receivable                 Bad debt provision                Proportion(%)
Within item 1 year
Within 1 year                                     395,480,734.49                      19,536,993.94                            5.00%
1-2 years                                          67,082,013.00                       6,708,201.30                         10.00%
2-3 years                                          41,702,166.65                      12,510,649.99                         30.00%
3-4 years                &n