ANNUAL REPORT

Stock Code: 601668.SH

Cover Photo: Ningliang Section of Dongjiakou-Liangshan Expressway

 CORPORATE VISION

To be the investment and

construction group with the most
international competitiveness

COPRORATE MISSION

Expanding a happy
living environment

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 CONTENTS

1 CHAIRMAN’S STATEMENT

3 IMPORTANT NOTES

4 SECTION I DEFINITIONS

5 SECTION II COMPANY PROFILE AND KEY FINANCIAL INDICATORS

9 SECTION III OVERVIEW OF BUSINESS OPERATION

20 SECTION IV DISCUSSION AND ANALYSIS OF BUSINESS

OPERATION

46 SECTION V IMPORTANT MATTERS

80 SECTION VI CHANGES IN ORDINARY SHARES AND

SHAREHOLDERS

87 SECTION VII INFORMATION RELATED TO PREFERRED SHARES

90 SECTION VIII DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT

AND EMPLOYEES

102 SECTION IX CORPORATE GOVERNANCE

110 SECTION X INFORMATION ON CORPORATE BONDS

110 SECTION XI FINANCIAL REPORT

110 SECTION XII INDEX OF DOCUMENTS AVAILABLE FOR INSPECTION

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 CHINA SECURITIES REGULATORY COMMISSION
SHANGHAI STOCK EXCHANGE

The Company prepared its 2020 Annual Report in accordance with relevant regulations and
guidelines set forth by the China Securities Regulatory Commission and the Shanghai Stock
Exchange, including the Publicly Listed Company Information Disclosure Content and Format
Guideline No. 2 – Content and Format of the Annual Report, the Shanghai Stock Exchange Listing
Rules and other relevant regulations and guidelines. This is a free translation into English of a
report issued in China and is provided solely for the convenience of English-speaking readers.
This report should be read in conjunction with, and is construed in accordance with, China law
and professional auditing standards applicable in China. Should there be any inconsistency
between the Chinese version and the English version, the Chinese version shall prevail. Investors
can access the Company’s 2020 Annual Report on the website of the Shanghai Stock Exchange
(www.sse.com.cn).

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 CHAIRMAN’S STATEMENT
1
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

CHAIRMAN’S STATEMENT

Dear shareholders and investors,

On behalf of the Board of Directors of CSCEC, I would like to present to you the Annual Report 2020 of the Company, and to
express my sincere gratitude to all stakeholders who have long been supporting and interested in the reform and development of
the Company.

The year of 2020 was an exceptionally unusual year. Amid the complex international circumstances and the arduous and onerous
missions in relation to consolidating the reform and development initiatives of the PRC, especially the severe impact of the
COVID-19 pandemic, and under the strong leadership of the Party Central Committee with Comrade Xi Jinping at the core, CSCEC
has implemented in depth the decisions and policies of the Party Central Committee and the State Council, and implemented the
requirements of the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council. The Company
focused on the strategic goal of “one creation and five aspects of strength”, and made the utmost efforts to proceed with pandemic
prevention and control and promote production and operation. We made extraordinary progress while maintaining stability and
delivered a successful conclusion of the Company’s “13th Five-Year Plan” by facing up to challenges and overcoming difficulties
with bravery and tenaciousness. The value of new contracts for the whole year stood at RMB3.2 trillion, topping the RMB3 trillion
level for the first time, representing a year-on-year increase of 11.6%; the revenue was RMB1.62 trillion, representing a year-on-
year increase of 13.7%; the net profit attributable to shareholders of the Company was RMB44.94 billion, representing a year-
on-year increase of 7.3%, and basic earnings per share was RMB1.07, representing a year-on-year increase of 10.3%. CSCEC
becomes the only company in the global construction industry with both its value of new contracts and revenue exceeding RMB1
trillion. The Company ranked 18th on the Fortune Global 500 list, 3rd on the list of Fortune China 500, and 1st on ENR’s Top 250
Global Contractors rankings. We continued to maintain the highest credit ratings among the global industry peers, enhanced our
market competitiveness and brand influence and consolidated our leadership in the industry.

In 2020, the Company’s business management delivered a number of breakthroughs and achievements, which are mainly
reflected in the following five aspects:

Firstly, the Company made remarkable achievements in respect of pandemic prevention and control as well as production
and operation. The Company firmly assumed the responsibility and mission of a central enterprise, and resolutely submitted to the
overall planning of the national anti-pandemic campaign. By efficiently coordinating and organizing resources from all parts of the
society, we completed 119 emergency hospital construction tasks, including Wuhan Huoshenshan and Leishenshan hospitals, and
was recognized, among others, as national advanced collective and advanced individuals in fighting the COVID-19 pandemic.
The Company coordinated the normalized pandemic prevention and control of tens of thousands of projects under construction in
a scientific manner, dispatched working groups and medical teams to help overseas branches handle the pandemic prevention
and control based on local conditions, and spared no effort to ensure the safety and health of 350,000 employees and more than 2
million migrant workers. The Company has taken multiple measures to promote the resumption of work and production accurately
and forcefully. A substantial number of major projects associated with the national economy and people’s livelihood have been
advanced as scheduled, and our key operating indicators have reached a record high, thus enabling the Company to effectively
playing the role of “stabilizer” and “ballast stone”.

Secondly, we submitted to the national strategy firmly and forcefully. The operation of the Company was deeply integrated
into the regional coordinated development strategy as we completed investments amounting to RMB308.6 billion in the Beijing-
Tianjin-Hebei Region, the Yangtze River Economic Belt, the Guangdong-Hong Kong-Macao Greater Bay Area, the Yangtze River
Delta and the Yellow River Basin, and enhanced exchanges and cooperation with local governments and other central enterprises
to jointly promote the implementation of national strategies. Our overseas branches have been doing their best to hold on to
the local market, and have been deeply implementing the Belt and Road Initiative (“BRI”), thus making key overseas operating
indicators buck the declining trend.

Thirdly, the key reform tasks were advancing in depth. As we comprehensively implemented the three-year campaign of state-
owned enterprise reform and conscientiously enforced “two consistencies” to facilitate the improvement of modern enterprise
system with Chinese characteristics, we have achieved phased results of key special project reforms in pilot programs including
“mixed-ownership pilot campaign”, “Two-hundred Campaign” and “Science Reform Demonstration Action”. Furthermore, the
pilot program of the professional manager system reform has reaped more matured results, and the “Management Enhancement
Action in Alignment with International Top Level” has been carried out in a comprehensive manner. The phase IV A-share incentive
scheme smoothly kicked off with a view to stimulating the enthusiasm and creativity of managers and key personnel on a larger
scale.

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 CHAIRMAN’S STATEMENT
2
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Fourthly, the “Six Special Actions” continued to be carried out in depth. The Company insisted on taking special actions to
strengthen our areas of weakness, having solved a number of bottlenecks that obstruct our high-quality development. Science
and technology innovation reached a new level. In particular, the Company won two more first prizes of the State Scientific and
Technological Progress Award, and the investment in R&D and the number of innovation achievements hit a record high. Efforts
were made to deploy and build a new generation of information architecture, and accelerate the pace of digital transformation
of enterprises. As the target of reducing leverage was successfully achieved, the debt-to-asset ratio at the end of the year was
73.7%, and the total asset turnover ratio improved year-on-year. We are more capable of making investment and management
decisions and operating PPP projects. Our refined project management was continuously improved, and the safety production
conditions was continuously optimized.

Fifthly, the Company undertook its social responsibility proactively and fruitfully. We successfully completed the task of
targeted poverty alleviation assistance, particularly, helping remove all three targeted poverty alleviation counties in Gansu from
the poverty-stricken counties list. We have safeguarded the timely payment for migrant workers and private enterprises as agreed.
Vigorous efforts were made to give full play to the supporting and leading functions of the industry chain and supply chain, thus
boosting the common development of upstream and downstream enterprises. We recruited 28,000 college graduates and created
2 million jobs, making an important contribution to stable employment.

The year 2020 is the final year of the 13th Five-Year Plan. Over the past five years, as CSCEC has been studying and implementing
the important remarks of General Secretary Xi Jinping on the reform and development of state-owned enterprises and building of
Party, the Company has made remarkable achievements in the reform and development, creating one miracle after another in the
history of global architecture and delivering a magnificent picture of Chinese construction. By accelerating the pace of reform,
the Company has been successfully selected by SASAC as one of the 10 model enterprises for the “World-class Enterprises
Campaign” and has established and expedited the achievement of its strategic goal of “one creation and five aspects of strength”.
The Company’s exceptional achievements in technological innovation and engineering excellence were demonstrated by 12
National Science and Technology Progress Awards, 25 awards of Tien-yow Jeme Civil Engineering Prize, 142 CSCEC Engineering
Luban Awards and 301 National Quality Engineering Awards. As the Company’s competitive edge in the whole industry chain
has been consolidated, we saw sustained enhancement in the development quality of housing construction, infrastructure, real
estate as well as prospecting and design, steady growth of our overseas business and fast expansion of our new business.
Specifically, the Company recorded an average annual growth rate of 12.9% in revenue and 11.5% in net profit attributable to
ordinary shareholders of the Company. The Company jumped from the 37th to the 18th place in the Fortune Global 500 rankings,
maintaining its position as the world’s largest investment and construction group. The Company has been practicing its social
responsibility in an in-depth manner. It was actively committed to improving people’s livelihood, successfully completing the task
of targeted poverty alleviation assistance, thus making positive contributions to the overall building of a well-off society. During
the period, the Company distributed dividends to all shareholders in an amount of more than RMB33.7 billion in an effort to bring
returns to investors.

The year 2021 marks the 100th anniversary of the founding of the Communist Party of China and the first year of the “14th Five-Year
Plan”. CSCEC will firmly hold high the great banner of Xi Jinping’s thought on socialism with Chinese characteristics in the new era,
fully implement the spirits of the 19th CPC National Congress, the 2nd, 3rd, 4th and 5th Plenary Sessions of the 19th CPC Central
Committee and the Central Economic Work Conference, earnestly arrange meetings of heads of central enterprises, adhere to
the general work guideline of making progress while maintaining stability. In addition, as we enter a new development stage, we
will follow a new development philosophy and help to foster a new development pattern. We will also focus on the “one creation
and five aspects of strength” strategic goals, accelerate the implementation of 166 strategic initiatives, enhance the normalized
pandemic prevention and control, strictly regulate production and operation and promote high-quality development. The Company
is striving to sign new contracts worth over RMB3.50 trillion and register a revenue of RMB1.76 trillion. The Company is dedicated
to bringing better returns to its shareholders and investors and embracing the 100th anniversary of the founding of the Party with
exceptional achievements and top-level performance.

Chairman: Zhou Naixiang

April 16, 2021

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 IMPORTANT NOTES
3
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

IMPORTANT NOTES

I. The Company’s Board of Directors, Board of Supervisors and Directors, Supervisors and Senior Management
guarantee that information contained in the Annual Report is true, accurate and complete and does not contain
any false representations, misleading statements or material omissions, and severally and jointly accept legal
responsibility thereof.

II. This Report was passed at the 53rd meeting of the second session of the Board of the Company, at which all the
Directors of the Company had attended.

III. Ernst & Young Hua Ming LLP (Special General Partnership) issued a standard unqualified audit report to the
Company.

IV. Zhou Naixiang, Head of the Company (Chairman); Wang Yunlin, Head of Accounting (Chief Financial Officer); and
Xie Song, Head of the Accounting Office (Chief Accounting Officer) guarantee that the financial report set out in the
Annual Report is true, accurate and complete.

V. Profit distribution plan or the conversion plan of reserves to share capital for the Reporting Period considered by
the Board of Directors

On the basis of 41,948,167,844 capital shares as of the date of disclosure, the Company proposes to distribute a cash
dividend of RMB2.147 (tax inclusive) for every 10 shares to all ordinary shareholders, and the ratio of the annual cash
dividend payout to net profit attributable to shareholders of the Company is 20.04%. In case of any change in its total
share capital prior to the record date of shareholders for profit distribution plan, the Company proposes to maintain
the distribution ratio per share unchanged, and to adjust the total distribution amount accordingly. An announcement
containing details of the adjustments will be made separately. The profit distribution plan was considered and approved at
the 53rd meeting of the second session of the Board and is subject to the consideration and approval by the 2020 annual
general meeting of the Company.

VI. Risk statement with respect to forward-looking statements

√ Applicable    N/A

This Report contains certain forward-looking statements made on subjective assumptions and judgments on future policies
and economic trends, which may differ from the actual results or trends due to a range of variables.

The forward-looking statements regarding future plans, development strategies, etc. contained in this Report do not
constitute a material commitment to investors by the Company, and investors are advised to exercise attention.

VII. Whether there is any non-operating misappropriation of funds of the Company by the controlling shareholder and
its related parties

No

VIII. Whether the Company has provided any guarantee in favor of external parties in violation of the prescribed
decision-making procedures

No

IX. Whether more than half of the directors are unable to guarantee the truthfulness, accuracy and completeness of
the Annual Report disclosed by the Company

No

X. Warning on major risks

During the Reporting Period, the Company is not exposed to major risks.

The Company has described possible related risks in detail in this Report. Please refer to the relevant information set out in
“Discussion and Analysis of the Future Development of the Company” under Section IV “DISCUSSION AND ANALYSIS OF
BUSINESS OPERATION” hereof.

XI. Miscellaneous

√ Applicable    N/A

In addition to the audited financial data, the business data used in this Report comes from the management of the
Company.

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 SECTION I  DEFINITIONS
4
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

SECTION I  DEFINITIONS
In this Report, unless the context otherwise requires, the following words shall have the following meanings:

Definitions of common words

CSCEC/the Company China State Construction Engineering Corporation Limited (中国建筑股份有限公司)

China State Construction/the Group China State Construction Engineering Corporation (中国建筑集团有限公司)
China Construction First Group China Construction First Group Corporation Limited to China Construction Eighth
Corporation to Eighth Engineering Engineering Division Corp. Ltd. (中国建筑一局（集团）有限公司至中国建筑第八工
Division 程局有限公司)
Xinjiang Construction & Engineering CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. (中建新疆建工（集
团）有限公司)
COHL China Overseas Holdings Limited (中国海外集团有限公司)
CSCEC International Operations China State Construction Engineering Corporation International Operations (中国
建筑国际工程公司)
China Overseas The real estate development brand and business owned by China Overseas Land
& Investment Ltd. (中国海外发展有限公司) (00688.HK), a subsidiary of COHL
CSC Land The real estate brand and business other than “China Overseas” that CSCEC is
engaged in
China Construction Engineering Design China Construction Engineering Design Group Corporation Limited (中国中建设计
Group 集团有限公司)
China Overseas Land & Investment China Overseas Land & Investment Ltd. (中国海外发展有限公司) (00688.HK)
CSC International China State Construction International Holdings Limited (中国建筑国际集团有限公
司) (03311.HK)
China Overseas Grand Oceans China Overseas Grand Oceans Group Limited (中国海外宏洋集团有限公司)
(00081.HK)
CSC Development China State Construction Development Holdings Limited (中国建筑兴业集团有限
公司) (00830.HK)
China Overseas Property China Overseas Property Holdings Limited (中海物业集团有限公司) (02669.HK)
West Construction China West Construction Group Co., Ltd. (中建西部建设股份有限公司) (002302.
SZ)
CSC Finance China State Construction Finance Co., Ltd. (中建财务有限公司)
China Construction Fangcheng China Construction Fangcheng Investment & Development Group Co., Ltd. (中建
方程投资发展集团有限公司)
China Construction Capital China Construction Capital Holdings Limited (中建资本控股有限公司)
China State Decoration China State Decoration Group Co., Ltd. (中国建筑装饰集团有限公司)
China Construction Infrastructure China Construction Infrastructure Co., Ltd. (中国建设基础设施有限公司)
CSCDC China State Construction Development Co., Ltd. (中国建筑发展有限公司)
China Construction Science and Industry China Construction Science and Industry Corporation Ltd. (formerly known as
China Construction Steel Structure Co., Ltd. (中建钢构有限公司))
China Construction Communications China Construction Communications Engineering Group Co., Ltd. (中建交通建设
集团有限公司)
China Construction Science & Technology China Construction Science & Technology Group Co., Ltd.（中建科技集团有限公
司）(formerly known as China Construction Science & Technology Co., Ltd. (中建
科技有限公司))
China Construction Harbour and Channel China Construction Harbour and Channel Engineering Bureau Group Co., Ltd. (中
Engineering Bureau 建港航局集团有限公司)
Articles of Association Articles of association of China State Construction Engineering Corporation
Limited
Reporting Period From January 1, 2020 to December 31, 2020

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 SECTION II  COMPANY PROFILE AND KEY FINANCIAL INDICATORS
5
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

SECTION II  COMPANY PROFILE AND KEY FINANCIAL INDICATORS

I. Information of the Company

Chinese name 中国建筑股份有限公司

Chinese abbreviation 中国建筑
English name China State Construction Engineering Corporation Limited
English abbreviation CSCEC
Legal representative Zhou Naixiang

II. Contact Details

Secretary to the Board of Directors

Name Xue Keqing
CSC Fortune International Center, Building 3, Courtyard 5, Anding
Address
Road, Chaoyang District, Beijing
Tel. 010-86498888
Fax 010-86498170
Email [email protected]

III. Overview of Basic Information

Registered address No.15, Sanlihe Road, Haidian District, Beijing

Postal code of the registered address 100037
CSC Fortune International Center, Building 3, Courtyard 5, Anding
Office address
Road, Chaoyang District, Beijing
Postal code of the office address 100029
Website www.cscec.com
Email [email protected]

IV. Information Disclosure and Place for Inspection of Annual Report

Name of media designated by the Company China Securities Journal, Shanghai Securities News, Securities Times
  for information disclosure and Securities Daily
Website designated by CSRC for publishing
www.sse.com.cn
  annual report
CSCEC Board Office
Place for inspection of annual report CSC Fortune International Center, Building 3, Courtyard 5, Anding
Road, Chaoyang District, Beijing

V. Overview of Stocks

Overview of stocks
Type Stock exchange Abbreviation Stock Code Original ticker
A share Shanghai Stock Exchange CSCEC 601668 N/A

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 SECTION II  COMPANY PROFILE AND KEY FINANCIAL INDICATORS
6
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

VI. Other Relevant Information

Ernst & Young Hua Ming LLP
Name
(Special General Partnership)
Accounting firm engaged Level 16, Ernst & Young Tower, Oriental Plaza,
by the Company (domestic) Office address No. 1 East Chang An Avenue, Dong Cheng District,
Beijing, PRC
Name of signatory Zhou Ying, Yang Shujuan, Shen Yan

VII. Key Accounting Data and Financial Indicators for the Last Three Years

(I) Key accounting data

Unit: ’000 yuan  Currency: RMB
2018
Change
Key accounting data 2020 2019 After Before
YoY (%)
adjustment adjustment
Revenue 1,615,023,327 1,419,836,588 13.7 1,199,324,525 1,199,324,525
Profit before income taxes 94,290,605 81,467,846 15.7 71,788,788 71,788,788
Net profit attributable to shareholders of the Company 44,944,250 41,881,399 7.3 38,241,324 38,241,324
Net profit attributable to shareholders of the Company
42,685,522 42,491,547 0.5 37,535,578 37,535,578
  after deducting non-recurring profit or loss
Net cash flows from operating activities 20,271,781 -34,220,077 / 10,311,290 10,311,290

At the end of 2018

At the end At the end Change
of 2020 of 2019 YoY (%) After Before
adjustment adjustment
Net assets attributable to shareholders of the Company 300,421,431 277,197,681 8.4 243,892,279 243,961,186
Total assets 2,192,173,839 2,034,451,929 7.8 1,849,004,412 1,861,840,298
Total share capital at the end of the period 41,965,072 41,975,630 -0.03 41,985,174 41,985,174

(II) Key financial indicators

2018
Change
Key financial indicators 2020 2019 After Before
YoY (%)
adjustment adjustment
Basic earnings per share (RMB/share) 1.07 0.97 10.3 0.87 0.87
Diluted earnings per share (RMB/share) 1.07 0.96 11.5 0.85 0.85
Basic EPS (RMB/share) after deducting non-recurring
0.99 0.98 1.0 0.85 0.85
  profit or loss
Decrease
of 0.06
Weighted average return on net assets (%) 15.54 15.60 15.97 15.97
percentage
points
Decrease
Weighted average return on net assets after deducting of 1.08
14.76 15.84 15.66 15.66
  non-recurring profit or loss (%) percentage
points
Net assets per share attributable to
6.92 6.10 13.4 5.26 5.26
  ordinary shareholders (RMB/share)
Dividend per 10 shares (RMB) 2.147 1.85 16.1 1.68 1.68
Explanation on the Company’s key accounting data and financial indicators for the three years preceding the end of the
Reporting Period

√ Applicable  N/A

① Due to the Company’s adoption of new accounting standards during the period, the amounts before and after
adjustment represent those at the end of the 2018 Reporting Period and those at the beginning of period after the
adoption of new standards on January 1, 2019 respectively.

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 SECTION II  COMPANY PROFILE AND KEY FINANCIAL INDICATORS
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

② When calculating earnings per share, the restricted shares that have not yet met the unlocking conditions and
become invalid are deducted from the weighted average number of ordinary shares issued by the Company.

③ According to relevant accounting requirements, when calculating earnings per share, the dividends or interests of
other equity instruments such as preferred stocks and perpetual bonds and restricted shares shall be excluded
from the net profit attributable to shareholders of the listed company.

④ The net assets per share attributable to ordinary shareholders are the net assets attributable to shareholders of the
parent company deducting other equity instruments, and then divided the balance by the total number of issued
shares at the end of the Reporting Period.

⑤ Dividend amount (tax inclusive).

For details, please refer to Note XI “Share-based payment” and Note V. 63 “Earnings per share” to the financial statements
under Section XI “FINANCIAL REPORT” hereof, and Supplementary Information from the Management II “Return on Net
Assets and Earnings Per Share” and other relevant information.

VIII. Differences between Accounting Data under Domestic and Foreign Accounting Standards

(I) Differences of net profit and net assets attributable to shareholders of the Company in the
financial report disclosed in accordance with the International Accounting Standards and
Chinese Accounting Standards
Applicable √ N/A

(II) Differences of net profit and net assets attributable to shareholders of the Company in the
financial report disclosed in accordance with both foreign accounting standards and Chinese
accounting standards
Applicable √ N/A

(III) Explanation on differences between domestic and foreign accounting standards

Applicable √ N/A

IX. Key Financial Data of 2020 by Quarter

Unit: ’000 yuan  Currency: RMB

Q1 Q2 Q3 Q4
(Jan. – Mar.) (Apr. – Jun.) (Jul. – Sep.) (Oct. – Dec.)
Revenue 263,830,618 464,357,149 347,918,442 538,917,118
Net profit attributable to shareholders
7,572,374 12,267,411 11,297,053 13,807,412
  of the Company
Net profit attributable to shareholders
  of the Company after deducting 7,419,483 11,163,925 11,122,972 12,979,142
  non-recurring profit or loss
Net cash flows from operating activities -90,976,368 20,331,162 -17,767,836 108,684,823

Note: The Company’s key quarterly financial data has not been audited.

Explanation on differences between the quarterly data and data contained in regular reports disclosed

Applicable √ N/A

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 SECTION II  COMPANY PROFILE AND KEY FINANCIAL INDICATORS
8
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

X. Statement of Non-Recurring Profit or Loss

√ Applicable  N/A

Unit: ’000 yuan  Currency: RMB

Note
Non-recurring items Amount of 2020 Amount of 2019 Amount of 2018
(if applicable)
Gains from disposal of non-current assets 143,538 / 80,472 29,931
Non-operating
Government grants related with non-daily operations 110,094 income and 137,067 75,848
expenses
Investment
Gain from stepped acquisition 133,746 248,249 -238
income
In addition to the normal operation of the company’s
  effective hedging business, income/losses arising from
  changes in fair value and from disposal/redemption of
247,894 / -436,009 -325,733
  the financial assets held for trading, derivative financial
  assets, financial liabilities held for trading, derivative
  financial liabilities and other debt investments
Interest income from loans
58,784 / 492,765 247,830
  non-financial corporations
Reversal of the provision on receivables and
1,288,041 / 2,291,693 849,770
  contract assets for impairment on an individual basis
Income from disposal of long-term equity investments 7,016 / 274,341 3,385
Investment income from disposal of subsidiaries 136,721 / 138,333 226,038
Losses from non-operating activities or occasional matters 1,212,987 / -3,127,374 /
Other non-operating income and expenses than the
-278,721 / 77,620 87,215
  above items
Impact on income tax -559,777 / -615,658 -384,906
Impact on non-controlling interests (after tax) -241,595 / -171,647 -103,394
Total 2,258,728 / -610,148 705,746

XI. Items Measured at Fair Value

√ Applicable  N/A

Unit: ’000 yuan  Currency: RMB

Opening Closing Current Effect on

Name of item
balance balance changes current profits
Exchangeable bonds 11,635,832 4,421,322 -7,214,510 60,204
Financial assets held for trading 902,072 244,459 -657,613 12,266
Investments in other equity instruments 8,069,043 5,838,384 -2,230,659 156,146
Other non-current financial assets 50,510 335,510 285,000 0
Accounts receivable financing 3,674,166 3,788,082 113,916 0
Current portion of non-current assets 0 182,608 182,608 0
Other debt investments 612,106 356,377 -255,729 19,278
Other current assets 3,557,504 2,906,177 -651,327 59,533
Total 28,501,233 18,072,919 -10,428,314 307,427

XII. Miscellaneous

Applicable √ N/A

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 SECTION III  OVERVIEW OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

SECTION III  OVERVIEW OF BUSINESS OPERATION

I. Explanation on the Company’s Principal Business, Business Model and Industry Information
during the Reporting Period

(I) Principal business and business model

As an investment and development conglomerate bestowed with the longest history of specialized and market-
oriented operation, the most developed level of integration in the PRC and the largest scale in the world, CSCEC
is a market leader in housing construction engineering, infrastructure construction and investment, real estate
development and investment, prospecting, and design etc. CSCEC ranks 18th in Fortune Global 500 (2020) and
among top 3 on the list of Fortune China 500 for eight consecutive years, and tops the list of the 2020 Top 250
Global Contractors published by Engineering News-Record (ENR). CSCEC has been rated as Grade A by the
SASAC of the State Council for 15 times. The leading global rating agencies, i.e., S&P Global Ratings, Moody’s
Investors Service and Fitch Ratings affirmed CSCEC’s ratings as A/A2/A (respectively) with “Stable” outlook, the
highest credit ratings among the global industry peers.
CSCEC stands as one of the most competitive investment companies in China, specializing in real estate
development, financing and investment for construction projects and integrated urban construction. Featuring
a “four in one” business model integrating planning and design, investment and development, infrastructure
construction and housing construction engineering, it provides a turnkey solution covering all aspects, processes,
elements for urban development projects, with a priority given to the synergy between internal resource integration
and business development.
Tapping into more than 100 countries and regions, CSCEC, as the largest engineering contractor in the world,
specializes in a broad range of business covering all aspects related to urban development and each stage
throughout construction projects. The Company is well equipped with the capabilities of comprehensive design,
construction and land development, and is well positioned to compete relying on its complete industry chain
of construction products ranging from R&D on technology of products, prospecting and design, real estate
development, construction contracting, equipment manufacturing and asset operation to property management.
Among most super-high-rise buildings with a height of 300 meters or above in China, those technically
sophisticated and structurally complicated are built by CSCEC.
Among the 10 model enterprises selected by SASAC for the “World-class Enterprises Campaign”, CSCEC is the
only company engaged in a “perfectly competitive market”. Under the guidance of “Decision to Accelerate the
Establishment of World-class Enterprises” and the “Implementation Plan of the World-class Model Enterprises
Campaign”, we continue to explore the science connotation of “one creation and five aspects of strength”1 in
alignment with world-class enterprises and advanced enterprises in the industry, focus on enhancing scientific and
technological innovation, improve governance effectiveness, deepen reform of state-owned enterprises, integrate
into national strategies, promote international operations, accelerate digital transformation, promote green
development, develop and expand new business, and improve the level of leadership of Party building.
CSCEC further deepened the reform and innovation as the driving force, benchmarking with the top enterprises
within and beyond the industry in the world, steadily promoted the “Two-hundred Campaign” reform, the “mixed-
ownership pilot campaign” and the “Innovative Technology Reform Demonstration Enterprise” initiative, in a
way to continuously optimize our corporate governance mechanism and modern enterprise system. “Two-
hundred Campaign” reform reaped promising result, the Second Construction Co., Ltd. of China Construction
First Group Corporation Limited advanced the reform in all aspects. The specific measures included introduction
of strategic investors, completion of capital increase and share increase, transition from a sole shareholder to
binary shareholders, taking office by the first batch of professional managers and simultaneously facilitating the
“three systems” reform consisting of administration, labor and distribution. CSCEC adopted a market-based
human resource management approach comprehensively whereas we had in place full coverage of performance
appraisal, establishing a performance culture and remuneration system to provide incentives for value creation
and sophisticated and diversified incentive mechanisms including restricted share plan, share option incentive,
bonus incentive and tenure incentive in a bid to stimulate the vitality of the Company. Under the market-oriented
and contract-based guidance, CSCEC introduced the reform of professional manager system in seven subsidiaries
and the tenure system and contractual management of managerial members in the subsidiaries which carried out
“innovative technology reform” and “mixed-ownership pilot campaign”. Accordingly, “three systems” reform has
been undergoing in an in-dept manner.

1
“one creation” refers to the goal of establishing CSCEC as a world-class company with strong global competitiveness. “five aspects of
strength” refer to strong value creativity, strong innovation leadership, strong brand influence, strong international competitiveness and
strong cultural soft power.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Upholding the guiding philosophy of “implementing the new development concepts and adhering to high-quality
development”, CSCEC made concrete efforts to advance the restructuring, transformation and upgrading. The
Company took the strategic goals of “one creation and five aspects of strength” as the guide for the “14th Five-
Year Plan”, to unify our thinking and lead the future, and uphold the concepts of marketization, high-quality
development, reform and innovation, green development, people-oriented development, development conforming
to greater security and international development. Motivated by our determination of building up a globally
competitive top-class enterprise, and on the basis of facilitating the reform of state-owned enterprises, the
Company accelerated “166” strategic initiatives2 and was committed to becoming a leading global conglomerate
with strong value creativity, strong innovation leadership, strong brand influence, strong international
competitiveness and strong cultural soft power.

Positioned as a competitive player in the entire construction industry chain, we are committed
to providing domestic and foreign clients with one-stop services from design, construction to
implementation of major high, big, professional, cutting-edge, difficult and special construction
projects. To this end, we implemented a series of measures, including tapping our potential,
strictly controlling over construction quality and costs, and improving client satisfaction.
Meanwhile, we adhered to a marketing strategy oriented toward “high-end markets, high-end
customers, high-end projects” and an operation strategy prioritizing “low-cost competition, high
quality management”. We have constructed a large number of extremely challenging landmark
projects ranging from skyscrapers, large public buildings, clean plants, hotels, hospitals to
Housing schools in the civilian, public and industrial construction sector, representing the highest
construction standard in the field of housing construction in China, which established CSCEC as a leader
engineering in the Chinese and global housing construction markets. As a trendsetter in the industry, the
Company seeks to enhance the standards of ecological civilization and green development,
reduce energy consumption, and create an excellent living environment for the public through
industrialized, eco-friendly and intelligent construction, reinforcing people’s sense of gain,
spiritual well-being and security.

Placing equal emphasis on construction and investment operations, we completed many high-
profile domestic and international infrastructure projects ranging from urban rail transits, high-
speed railways, extra-large bridges, expressways, municipal roads, urban utility tunnels, ports
and waterways, electricity, mining, metallurgy, petrochemical, airports to nuclear power plants,
leveraging our advantages in technology, management and talent. In addition, the Company
rapidly grows to be the best Chinese infrastructure financier and investor in reliance upon solid
financial strengths. Recognized as one of the most trusted investors for BT (Build-Transfer),
BOT (Build-Operate-Transfer) and PPP (Public-Private Partnership) projects, we invested in
numerous key national and regional projects, with long-term strategic partnerships in respect of
infrastructure investment and construction established with a number of provincial, autonomous
region, and direct controlled municipal governments and dozens of major cities. Furthermore,
infrastructure facilities built by us can also be found in dozens of countries and regions
Infrastructure worldwide, including North America, Central America, Hong Kong SAR, Macao SAR, Southeast
Asia, North Africa, Central and West Africa, South Africa, Middle East, and Central Asia. As an
construction and important driver for economic growth and effective implementation of national strategies, the
investment infrastructure industry bolsters areas of weakness at the grassroots level to foster the public’s
well-being, and serves as the main vehicle for driving development along the “Belt and Road”
and for strengthening interconnection between China and countries covered by the BRI. As a
strong supporter of national strategies and serving the needs of people’s livelihood, CSCEC
will continue to broaden its infrastructure business and actively participate in new infrastructure
business with the aim of improving people’s livelihood, bolstering areas of weakness to
promote the public’s well-being, and setting the development direction for emerging industries.

2
“166” strategic initiatives refer to “One Improvement, Six Commitments and Six Specialization” strategic initiatives. Specifically, One
Improvement means further improving political stance. Six Commitments means commitment to high-quality development, commitment to
innovation-driven development, commitment to serving national strategies, commitment to deepening reform of state-owned enterprises,
commitment to accelerating transformation and upgrading, and commitment to incorporation of Party leadership into corporate governance. Six
Specialization means the special acts of deepening inspection and rectification, enhancing scientific and technological innovation, disposing of
inefficient and ineffective assets, improving basic management, promoting information building-up and strictly enforcing safety production.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

China Overseas Land & Investment Ltd. (“China Overseas”) and China State Construction
Land (“CSC Land”) are the two real estate brands owned by CSCEC. Specifically, China
Overseas encompasses all real estate business of COHL, and has always ranked among the
most valuable property brands in China, with strong business presence in the Guangdong-
Hong Kong-Macao Greater Bay Area (GBA), the Yangtze River Delta, the Beijing-Tianjin-
Hebei Region and dozens of economically dynamic cities across the country. It boasts a
well-established and balanced nationwide strategic business network. CSC Land is the
brand used by the real estate business of the Company’s subsidiaries and branches, mainly
engaged in the middle-end real estate projects in first- and second-tier cities, as well as the
localized operation of real estate projects in third- and fourth-tier cities. CSCEC has stepped
up synergy between internal resources integration and business development to vertically
integrate a wide variety of operations ranging from investment, property development, design
Real estate
and construction to property operation and services. Leveraging on extraordinary construction development and
technology, advanced real estate development concept and first-class property service quality investment
, it has established a sophisticated investment operation and risk management system in the
real estate business area, and formed a unique competitive advantage in the industry chain.
Meanwhile, the Company has actively innovated products and business models and focused
on the public’s housing needs, and has been closely involved in the “New Urbanization”
campaign to make life more joyful for the people and build a more beautiful China.

The prospecting and design business arm of CSCEC mainly consists of seven top-rated
major prospecting and design service providers, with business covering architectural design,
urban planning, engineering survey, public utility design, etc. The Company has established
itself as a market leader in super-high-rise buildings, airports, hotels, sports facilities and
exhibition venues and ancient architects. We currently have almost 20,000 high-end technical
professionals specializing in construction engineering and design, public utility engineering
and design, engineering survey and geotechnical engineering, outranking all other market
Prospecting
players. The Company has made outstanding contributions to development of the sector in and design
terms of design originality, technology innovation and industry standards development.

CSCEC is one of the earliest companies that conducted international engineering contracting
business in China, and has always upheld the operating philosophy of “going global”.
After continuous overseas market development and operation over the decades, the
Company has established strong business presence in the global markets, with foreign
engineering contracting business covering housing construction, manufacturing, energy,
transportation, water conservancy, industry, petrochemical, hazardous substance treatment,
telecommunications and sewage/waste treatment projects, while exploring and successfully
completing overseas real estate projects. In terms of project operation, apart from the
traditional general contracting model, the Company actively explored other project operating
models, such as financing and investment channels to give an impetus to such project
business models as general contracting, DB (Design-Build), EPC (Engineering-Procurement-
Construct), BOT and PPP. Meanwhile, attempt has been made in respect of capital operations Overseas
such as cross-border mergers and acquisitions to enhance the quality and efficiency of operations
development overseas business. Adhering to the guiding principle of “prioritizing overseas
markets”, the Company has strengthened localized business management focusing on
integration of resources, and has developed overseas business development strategies from a
loftier vantage point and with a strong sense of responsibility to promote business globalization,
in line with the objectives of the BRI.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(II) Overview of the industry eco-friendliness, smart buildings and construction

industrialization within the CSCEC system.
The construction industry is an important pillar industry
of the national economy, which has a close relationship Focusing infrastructure investment on key areas.
with the development of the entire national economy In 2020, the central government has made important
and the improvement of people’s livelihood. In recent deployment for the construction of urban agglomerations
years, China’s construction industry has continued and central cities. In terms of improving the carrying
to develop rapidly, with its scale expanding, and the capacity of the central cities, the priorities were to
construction capacity improving. In 2020, the growth of bolster areas of weakness of people’s livelihood
China’s construction sector decelerated amid an increase projects, construct public service projects, build
in market concentration. Sticking to the proactive human settlements, and develop new districts and
fiscal policy, the state government has expanded large industrial towns in first- and second-tier cities. In
effective investments, increased investment in strategic terms of connection network improvement within urban
emerging industries, stepped up the upgrade focusing agglomerations, the priorities were to build the intercity
on industrialization, digitalization and smart operation rail transit network in the Yangtze River Delta, the GBA,
of construction, with a view to cultivating “Chinese Beijing-Tianjin-Hebei Region and other regions, and to
Construction” brands with global competitiveness. We bolster areas of weakness such as railways, motorways,
have also witnessed a shift of focus in innovation and water transportation, airports, water conservancy,
application of technologies toward BIM, industrial Internet, energy, agricultural and rural development, ecological
5G, artificial intelligence, Internet of Things (IoT), big and environmental protection, and construction of
data, cloud computing, robots and building machines, urban parking facilities and cold chain logistics facilities
etc. Meanwhile, adhering to the “green development” in urban and rural areas. Specifically, rail transport,
strategy, the government has worked out a scientific underground space, eco-environment protection and
and sound urbanization plan focusing on improving the telecommunication facility are expected to be the fastest
ecological environment, eco-friendly planning, design growing segments, and the total volume of road and
and construction standards, and is fully committed to railway projects will remain at a high level. Along with
building smart cities to promote harmony between people the commercialization of the 5G technology in the future,
and nature, leveraging digitalized construction, IT and the focus of infrastructure investment will shift toward the
other new technologies. new-generation infrastructure such as AI, the Industrial
Internet and IoT.
The property construction market has great potential
for growth. According to the national urbanization The real estate sector is transiting to a stock-based
plan, China’s urban population will grow to nearly one model. In 2020, adhering to the regulatory policy that
billion by 2030, implying a total demand for residential “houses are for living in, not speculation”, the central
properties of eighty billion to ninety billion square meters government implemented measures specifically based
(including housing properties and public buildings). A on local conditions, adopted multiple strategies, and
considerable gap between supply and demand indicates stepped up efforts to establish a multi-supplier and multi-
the promising prospect of the property construction channel housing system that places equal emphasis on
market. Specifically, the government has pushed forward rental housing and properties for sale. The goal is to meet
new urbanization initiatives such as the transformation the housing needs of all Chinese residents, while shifting
of old urban residential blocs and communities, as well the public’s perception of housing properties toward
as medical and healthcare, cultural and entertainment, their intrinsic function – houses are for people to live in.
sports and fitness facilities, and facilities for people’s Stringent regulatory policies were maintained, and as
livelihood, opening up new opportunities for construction the government introduced policies such as the “three
companies. The government has also promoted red lines” for real estate companies, the incremental
prefabricated building development and the proportion market tends to stabilize, and the real estate industry
of newly started prefabricated buildings has increased will gradually shift from an incremental model to a stock
year by year, which is expected to inject tremendous model. Urban renewal is an inevitable product of the
growth momentum into the construction market. As the stock era, which contains huge space and opportunities.
BRI deepened and gained traction on the international Besides, China’s urban renewal focuses more on
stage, a growing number of countries have joined the refinement and micro-renewal, and the transformation
global development initiative, leading to continuous of old communities has become a hot spot. The Ministry
growth of our prospective overseas markets. CSCEC has of Housing and Urban-Rural Development (MOHURD)
a proven track record of effective branding, management estimates that the overall investment of transformation
and technology development in the upscale property of old communities exceeds RMB4 trillion. At present,
construction market, and maintained its leading position local authorities have successively issued three-year
in the field. Meanwhile, benchmarked against the leading action plans for the transformation of old communities,
international standards, CSCEC has actively implemented and the MOHURD has launched pilot projects in 15 cities
“prefabrication + internet + IoT” technological innovation including Xiamen and Guangzhou. The most prominent
and construction practices, aiming to develop investment, feature of the transformation is “renovation”, which
industry and technology platforms that promote promotes the development of the market for decoration
and public supporting facilities construction.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

II. Explanation on Significant Changes in the Company’s Major Assets during the Reporting Period

√ Applicable N/A
During the Reporting Period, there were no significant changes in the Company’s major assets. For details of changes
in major operating assets, please refer to the relevant information of “Analysis of assets and liabilities” under Section IV
“DISCUSSION AND ANALYSIS OF BUSINESS OPERATION” hereof.
Among them: overseas assets amount to 1,854 (Unit: 100 million yuan, Currency: RMB), accounting for 8.5% of the total
assets. The above data of overseas asset has not been audited.

III. Analysis of the Core Competitiveness during the Reporting Period

√ Applicable N/A

(I) Market-oriented operating mechanism

As a main body of the market economy, CSCEC will always adhere to the market-oriented operating mechanism, to
respect, abide by, adapt to and take advantage of market rules, and gradually enhance its ability to operate in compliance
with market rules. Faced with the cut-throat market competition, CSCEC will take innovative approaches to tap into and
continuously meet the real and potential needs of customers, and continuously retain and attract customers with high-
quality products and value-added services. The Company will always adhere to the concept focused on performance,
and pursue excellence in performance by clearly defining objectives, scientifically designing processes and strengthening
efficient operations, as well as pursuing the growth at scale supported by profitability. With the efficient utilization and
operation of resources, the Company will improve efficiency in turnover of assets, and achieve return on assets higher
than that of average level of the industry while vigorously promoting economies of scale, and continue to gain higher
market share through steady growth. We always pay close attention to cash flow and take all measures to ensure net
operating cash inflow to pursue the sustainable and healthy development of the Company.
Innovation is the eternal focus for enterprises. As uncertainties in the market economy are becoming common, CSCEC will
break the market equilibrium with creativity, actively capture profit opportunities, seek to reorganize production elements,
continuously enhance quality of products and service, and open up new markets, new business and new customer base
to make full use of changes to explore innovation, thereby enhancing the Company’s market competitiveness. As an
economic organization, the Company will always be committed to pursuing economic performance, while believing that
an enterprise that truly stands up to market trends and has an ever-growing foundation must be a model for practicing
social responsibility. CSCEC will uphold the concept of green development, be dedicated to building quality projects for
the society, actively fulfill social responsibilities, and boost the happiness of people.

(II) Direction of globalization

The Company has always been adhering to the international business philosophy, solidly promoting the high-quality
development of overseas business, focusing on the integration of domestic and foreign resources, and is committed to
becoming a multinational company that allocates resources globally and operates efficiently. Thus, the Company took
swift actions amid the COVID-19 pandemic, and further enhanced its brand influence and global competitiveness by
leveraging on advantages of the whole industry chain and global resource allocation capabilities. The Company adopted
a localized operating approach, deeply developed the market where the Company was operated and deeply participated
in the urban development to actively explore a business model conforming to the development of the host country.
Through localized operation and by establishing a community of interests with local partners, we achieved sustainable
development in the host country. The Company insisted on market-oriented competition, improved its internationalization
level through competition with world-class enterprises and win-win cooperation, and broadened its global thinking with
a view to laying a solid foundation for the Company to participate in global competition and cooperation at a higher level
and to a deeper extent.

(III) Relevant and diversified and vertically integrated expansion

Producing or offering products or services that can continue to secure, serve and satisfy customers, is an important
guarantee for the long-term development of the Company. In terms of selecting products (or services), the Company has
centered on the diversification based on its existing technological advantages and market advantages. The Company
will continue to maintain its traditional advantages in prospecting and design, housing construction and real estate
development, while actively expanding horizontally in other fields such as infrastructure investment and construction
business.
CSCEC is committed to the vertically integrated expansion of investment, design, construction, operation and services,
and strives to establish a unique market position in the domain of its business, creating competitive advantages that are
difficult for its competitors to follow suit.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(IV) Competitive strategy featuring high quality, low cost and differentiation

Providing products and services with high quality and at low cost to the public has always been the goal of CSCEC. High
quality comes from the Company’s technological, human resources and organizational advantages; while low cost stems
from the Company’s integrated business model, benefits of scale as well as economies of speed. As an outstanding
SOE representative in a perfectly competitive industry, CSCEC has always taken “making appropriate and correct
decisions and doing right things” as the basic direction of the Company’s production, operation and career development.
Focusing on implementing the marketing strategy of “high-end markets, high-end customers, high-end projects”, the
Company continues to carry out “differentiation oriented” market operations and competition. Through implementing the
“differentiation” strategy, different subsidiaries within the Company focus on their respective market segments, either
differentiating by profession (specialization), or by region (regionalization), to develop their own “core products, unique
services” to reduce internal disorderly competition and strengthen the overall advantage of external competitiveness.

(V) A management and control model with balanced authorization and centralization

Showing respect to the development history of CSCEC, a competitive group management and control model is explored
and formed on the basis of the Group formed by multi-legal carriers. The Company’s headquarters is positioned as
one that exercises strategic management and control, fulfilling the responsibilities and duties of leadership, service
and supervision, and insists on the liberalization and management of the second-level subsidiaries. The second-level
subsidiaries operate under the authorization of the Company and enjoy the corresponding authorities based on the
extent of the responsibility. For labor-intensive and mature business, we increase the authorization and expand market
contact to speed up market response and improve service quality. For capital-intensive and less mature business, we
focus on resources to bring impact to target market segments, and actively seek rapid breakthroughs in target markets
on the basis of effectively avoiding risks. Aiming at different market segments, we adopt different strategies for market
competition and corresponding management and control models.

(VI) Results-oriented and accountability-based management system

Various management efforts of the Company have always been committed to the realization of the Company’s mission,
vision and goals. The fundamental purpose of management is to improve the efficiency of our work, while making
our employees more fulfilling and the Company more prosperous in the future. By way of the organic integration of
the management actions in the various functional areas of the Company, a vital, scientific, reasonable, concise and
efficient system is formed, which is believed to play an effective role in avoiding taking isolated and disorderly actions
and making excuses, and achieving the unification of responsibilities and rights. We firmly believe that managers are
defined by their responsibilities. In order to improve the quality of products and services, the Company is committed
to the standardization of management, technology and works. With the help of information technologies and through
the “integration” of standardization and informatization, work efficiency is improved, and “bottom line management” is
implemented to enhance product quality and reduce operating costs.

(VII) “People-centered” human resource management

The Company firmly believes that human resource is one of the core competitiveness of the Company. For CSCEC,
one of the aspects that can best reflect its competitive advantage is that it has a large group of talents dedicated to the
enterprise and their careers, having faith in that the interests of the team are higher than those of the individuals, having a
good knowledge of technology and management and good at marketing with merits as self-discipline, self-motivation and
self-betterment.
The Company will always follow the basic human resources management concept of “retaining talents with career
development opportunities, emotional connection and rewards” and “caring for individuals”, and will embed this concept
into the human resources management policies of the Company. The Company intends to establish a salary incentive
mechanism that combines individual value creation and ability and shares the solid results of the development of
enterprise, while strengthening the attraction and development of talents to better provide strong talent support to its
development.
The Company will always adhere to the employment principle of having both ability and morality while deeming virtue as
a priority. The Company believes that, “every individual has his/her shortcomings and strengths”, and does not pursue
perfect talents, but instead follows the concept of “employing people with strengths”. The Company adheres to the
“performance-based principle”, and “evaluates talents based on performance” through the “horse racing mechanism”.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(VIII) Promote development under the strategy of “integration of industry and finance”

Under the ever-changing external environment and in response to the diversified needs of its principal business, CSCEC
gives full play to the role of industrial finance, tapping the potential of its internal financial service institutions and providing
financial services for the development of its principal business, thus forming an industry-financing integration mode
with the characteristics of CSCEC. Leveraging on external financial market and internal professional financial platforms
such as CSC Finance and China Construction Capital, and in line with the characteristics of the industry in which the
Company engaged, the Company has carried out domestic and overseas capital pooling, loan pooling, bank credit
financing, bond financing, equity financing, structured financing, accounts receivable factoring, asset securitization,
supply chain financial, insurance pooling and other business, thus providing timely, differentiated financial services
which are irreplaceable by social finance and playing an active role in driving the development of the principal business,
broadening financing channels, reducing financing costs, revitalizing stock assets, and realizing capital reduction
and efficiency gains. At the same time, the Company strictly implements relevant national policies, strengthens daily
management, strictly controls financial risks, and stops its capital moving from the real economy to the virtual economy
and arbitrage of idle funds.

(IX) Core competitiveness driven by innovation in science and technology

The Company believes that science and technology are the primary productive force, which is a critical pull for the growth
and expansion of the Company. Despite being a player in a traditional industry, our continuous efforts in innovation in
science and technology have brought changes in our production and organization models, ensuring our leadership
in cost control and providing support for economies of scale and speed to form solid competitiveness in key aspects.
During the “13th Five-Year Plan” period, the Company took the lead in undertaking 10 national key R&D projects, ranking
first among building construction enterprises, involving green building, intelligent construction, building industrialization,
energy conservation and environmental protection, basic engineering software and other fields.
During the “13th Five-Year Plan” period, the Company accelerated the construction of an open and collaborative
technological innovation system, further stimulated the innovation drive, intensified efforts to make breakthroughs in
key and core technologies, and created strong industrial technology advantages. In terms of deepening the reform
of the science and technology system, the Company improved the system of scientific research management, results
management, and incentives for R&D talents by granting scientific research personnel the authority to make decisions on
the technical route, expanding the authority to adjust the scientific research budget of the undertaking unit, increasing the
incentive for R&D talents, and mobilizing the enthusiasm for innovation. In terms of strengthening technical leadership,
through continuous innovation, the Company has been engaged in diverse business fields such as super high-rise
construction equipment and technology, large-span building construction technology and techniques, intelligent
manufacturing of steel structures, high-performance concrete new materials, new-generation nuclear power plant
construction technology, architectural design with new Tang style and airport architectural design, which formed strong
scientific and technological strength and provided powerful impetus for the development of the Company’s housing
construction, infrastructure, overseas and new businesses.
In terms of reinforcing the building of the science and technology system, investment in science and technology has
continued to increase. The initial layout of innovation platform building-up has been formed, consisting of 103 high-
tech enterprises, 5 national-grade enterprise technology centers (including sub-centers), 59 provincial and ministerial-
grade enterprise technology centers, 5 provincial and ministerial-grade engineering research centers, 23 engineering
technology research centers, 2 key laboratories, 1 engineering laboratory, of which there is a total of 31 provincial and
ministerial-grade innovation platforms. We have built 10 postdoctoral workstations and 16 other kinds of science and
technology innovation platforms, forming an innovation development mechanism led by independent innovation and
combining industry, academia, research and application.

(X) Corporate culture in mind and action

CSCEC is an enterprise with a glorious history. We are innovating in the course of inheritance, adhering to the mission of
“bringing genuine happiness to society”, and committed to becoming the most internationally competitive investment and
construction group. In the process of fulfilling the mission and realizing the vision, the core values of “quality assurance,
value creation” and the entrepreneurial spirit of “integrity, innovation, transcendence, and win-win” will be integrated into
the rules and management behaviors and become part of the soft power of the Company.
Resources can be exhausted, only culture lasts. Adhering to its creed which is formed against the backdrop of the market
economy, the Company has seen a constant integration with its subsidiaries in culture development, which provides
ongoing internal support for the Company’s ever-growing business.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

IV. Brand, Creditability and Honors during the Reporting Period

Based on CSCEC’s good performance in brand building and operation development, the brand reputation and industry
influence of the Company has been further strengthened during the Reporting Period.
Brand value steadily increased. The Company ranked 18th in the Fortune Global 500 (2020), 3rd among the Fortune
China 500, first in ENR’s “Top 250 Global Engineering Contractors”, and among the top 10 in ENR international contractors
list for three consecutive years. “CSCEC” ranked first in the UK Brand Finance “2020 Global Brand Value Top 500”; in the
value evaluation of Chinese brands organized by China Council for Brand Development, the Company ranked first in the
construction industry with a brand strength of 972.00 and a brand value of RMB110.396 billion; it ranked the 17th in “China
Top 100 Brand Value List 2020”. Its subsidiary China Overseas was awarded the “China Real Estate Industry Leading
Brand” for the 17th time, with a brand value of RMB121.6 billion, ranking first in the industry. The Company ranked first in
the construction industry list of the “Overseas Image of Chinese Enterprises” in the “2020 Excellent Examples of Overseas
Image Building-up of Chinese Enterprises” by the China Foreign Languages Publishing Administration, and was selected
as one of the “Top Ten Excellent Examples of the Year”.
Leading the global industry in terms of creditability. In 2020, the leading global rating agencies i.e., S&P Global
Ratings, Moody’s Investors Service and Fitch Ratings affirmed CSCEC’s ratings as A/A2/A (respectively) with “Stable”
outlook. CSCEC maintained the highest credit ratings among the global industry peers for the 6th consecutive year; the
Company was granted the qualification of cross-border fund centralized operation business for multinational companies,
which facilitated cross-border financing of RMB and foreign currencies; the Company was awarded the “Excellent Sponsor
of Asset Securitization”, “Excellent Sponsor of Asset Securitization Innovative Business” and “Special Award for Pandemic
Control” by Shanghai Stock Exchange in 2020.
Further achievements in honors and awards. During the Reporting Period, 32 projects of the Company won the Chinese
Construction Engineering Luban Prize, 74 projects won the National Quality Engineering Award; the Company also won
71 National Construction Engineering Decoration Awards, 51 China Installation Engineering Quality Awards, and 68 China
Steel Structure Gold Awards. A total of 62 projects at home and abroad were awarded the International Safety Awards
in 2020 by the British Safety Council, accounting for 10% of the total awards granted. The Company was presented the
2020 Enterprise of the Year Award by Bosnia-Herzegovina’s mainstream media Evening News in recognition of its great
contribution to the progress of the Pan-European 5C corridor expressway project in the face of the pandemic, becoming
the only foreign company among the winners. The subsidiary China Construction Third Engineering Division received 6
awards from the CTBUH Global Awards of Excellence 2020. China Construction (South Pacific) Development Co., Pte Ltd.
won 6 “BCA Construction Excellence Awards” in Singapore, and one “BCA Quality Excellence Award - Quality Champion
(Platinum)”. The Egypt branch of CSCEC was awarded the “China-Egypt Anti-pandemic Cooperation Contribution Award”
by the Chinese Embassy in Egypt, the only Chinese enterprise in Egypt with this honor.
More fruitful achievements in scientific and technological innovation. During the Reporting Period, five scientific
and technological achievements passed the preliminary evaluation of the National Science and Technology Award, two
of which passed the preliminary evaluation of the first prize and three of which passed the preliminary evaluation of the
second prize. The quantity and quality of high-level scientific and technological achievements for the year hit the best
level in the Company’s history. Six projects of the Company took the lead in completing the construction received the 18th.
Among them, Que’er Mountain tunnel project of China Highway Line 317 was the only tunnel project selected in 2020. The
Company won 220 awards for the last three sessions of excellent survey and design in engineering survey, architectural
design industry and municipal public utility works. As of the end of the Reporting Period, the Company received a total
of 75 national science and technology awards, 90 awards of Tien-yow Jeme Civil Engineering Prize, and developed 244
national engineering construction methods, took the lead in preparing 91 national and industry standards and was granted
33,855 patents (including 3,175 invention patents). Our employees Qian Fang and Guo Xiaoyan were among the list of
9th batch national prospecting and design masters and Zhang Kun was awarded the National Innovation Pioneer Award.
The Company has 2 academicians of the Chinese Academy of Engineering, one winner of the highest-grade science
and technology award in engineering construction, 12 national engineering prospecting and design masters, 276 experts
entitled to special allowances from the State Council and 28 professionals were granted “China Skills Awards” or credited
as “national technical experts”. We developed a number of highly competitive innovation teams such as super high-
rise intelligent construction innovation team, civil engineering intelligent measurement and control innovation team, and
underground space intelligent construction innovation team.
Prominent performance in fulfilling social responsibility. The Company was awarded the highest honor of 2020
CAIJING Evergreen Award for Sustainable Development – “Sustainable Development Contribution Award”, the “Special
Contribution Award” of the 15th session of People’s Corporate Social Responsibility Summit Forum and its Sustainable
Development Report won the highest five-star rating by Chinese Academy of Social Sciences for the eighth consecutive
year. The China Alliance of Social Value Investment released the 2020 list of A-share listed companies’ sustainable
development value “Yili 99” on which CSCEC ranked first. CSCEC shared its experience in fulfilling social responsibilities
in the Collective Publication of Social Responsibility Reports of Central Enterprises (2020) by SASAC of the State Council,
and two examples were selected in the “Research Report on Corporate Social Responsibility of Central Enterprises (2020)”,
“Research Report on Overseas Social Responsibility of Central Enterprises (2020)” and “Cases of the Fight Against
COVID-19 Pandemic by Central Enterprises”.

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 SECTION III  OVERVIEW OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

V. Key Business Data

Growth YoY
Item Unit 2020 2019
(%)

Total value of new contracts RMB100 million 32,008 28,689 11.6

I. Construction business

(I) Accumulative value of new contracts during RMB100 million

27,721 24,863 11.5
the period

By industry 1.  Housing construction 20,779 19,506 6.5

2. Infrastructure 6,798 5,226 30.1

3.  Prospecting and design 143 131 9.1

By region 1.  Domestic 25,902 23,095 12.2

2. Overseas 1,819 1,768 2.9

(II) Quantity of housing construction works Ten thousand / / /

square meters
1. Accumulative area under construction 154,229 145,671 5.9

2. Accumulative area of new construction

34,239 38,301 -10.6
projects

3. Accumulative area of completed

19,079 23,220 -17.8
construction

(III) Quantity of infrastructure works / / / /

1. Road (newly signed in China) Kilometers 4,186 4,024 4.0

Ten thousand
2. Area (newly signed in China) 4,162 2,923 42.4
square meters

II. Real estate business

(I) Contract sales during the period RMB100 million 4,287 3,826 12.1

Of which: China Overseas① 2,960 2,669 10.9

(II) Contract sales area during the period Ten thousand 2,370 2,173 9.1
square meters
Of which: China Overseas 1,387 1,290 7.5

(III) Subscription sales at the end of the period RMB100 million 106 183 -42.0

(IV) Average selling price during the period RMB/square meter 18,087 17,606 2.7

(V) Land reserve at the end Ten thousand

11,637 12,166 -4.3
of the period② (Full amount) square meters

Of which: China Overseas 6,179 6,522 -5.3

(VI) Purchase of land reserve (Full amount) Ten thousand 2,042 2,259 -9.6
square meters
Of which: China Overseas 1,349 1,146 17.7

Notes: ① China Overseas refers to the real estate business that China Overseas Land & Investment and its subsidiaries are engaged in,
but does not include that of China Overseas Grand Oceans;

② Land reserve at the end of the period = land reserve at the end of the previous year + newly acquired land reserve – area
completed in the current period + (or –) area of projects being adjusted.

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 SECTION III  OVERVIEW OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

VI. Key Earnings Results

Unit: 100 million yuan  Currency: RMB

Value of new contracts for construction Contract sales of real estate business
business

30,000 27,721 5,000

4,287
24,863
25,000 23,285
22,249 4,000 3,826
20,000 18,796
3,000
2,986
15,000 2,286
2,000 1,896
10,000

1,000
5,000

0 0
2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

Revenue Net profit attributable to shareholders

of the Company

20,000 500
449.4
418.8
16,150
400 382.4
15,000 14,198
329.4
298.7
11,993
10,541 300

10,000
9,598
200

5,000
100

0 0
2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

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 SECTION III  OVERVIEW OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million yuan  Currency: RMB

Proportion of new contract value Proportion of revenue by segment Note

 
 

 

 

Housing Infrastructure Real Design Housing Infrastructure Real Design

construction estate construction estate

Proportion of gross profit by segment Note Gross profit margin by segment Note


30.0%
26.2%
25.0%
24.2%

  20.0%

15.0%

8.5%
10.0%
6.7%
5.0%

 0.0%
Housing Infrastructure Real Design
construction estate
Housing Infrastructure Real Design
construction estate

Note: The denominator of the segment business is the direct summation of data from the four business segments of the Company (housing
construction, infrastructure, real estate and design).

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION

The value of new contracts for I. Discussion and Analysis of Business Operation
the whole year made a
breakthrough by topping In 2020, amid the severe and complex domestic and international environment,

3
especially the serious impact of the COVID-19 pandemic, China maintained
steady economic recovery, effectively safeguarded employment and people's
livelihoods, and delivered better-than-expected results for its major objectives.
The GDP exceeded RMB101.60 trillion, representing a year-on-year increase
of 2.3%; the total investment in fixed asset (excluding farmers) in the whole
RMB trillion country was RMB51.89 trillion, representing a year-on-year increase of 2.9%; the
investment in real estate development was RMB14.14 trillion, representing a year-
on-year increase of 7.0%; the sales of commercial houses was RMB17.36 trillion,
representing a year-on-year increase of 8.7%; the sales areas of commercial
The revenue was houses were 1,760.86 million square meters, representing a year-on-year increase

1.62
of 2.6%; and the total output value of the construction industry was RMB26.39
trillion, representing a year-on-year increase of 6.2%.
In 2020, the Company implemented the decision and deployment of the Party
Central Committee and the State Council as well as the requirements of the SASAC,
RMB trillion focused on the strategic goals of “one creation and five aspects of strength”,
made coordinated efforts in pandemic prevention and control as well as business
development, worked hard and overcame difficulties, adhered to the general work
guideline of making progress while maintaining stability, actively practiced the
The net profit attributable concept of high-quality development, and achieved excellent results in reform and
development. The Company’s business, as a whole, has demonstrated a good
to shareholders of the momentum of steady enhancement in quality and stable development towards
Company was excellence, ranking among the top central enterprises in terms of operating

44.94
performance, and making due contributions to national pandemic prevention and
control efforts, economic development and the undertaking of building an overall
moderately prosperous society.

RMB billion II. Highlights of Operation Results for the Reporting Period
Prominent contribution in pandemic prevention and control. In early 2020, when
the COVID-19 pandemic was raging, the Company was commissioned at such
a critical moment. Relying on its strong supply chain system, core technological
Basic earnings per share was capabilities in rapid construction and integrated construction capability of assembly

1.07
buildings, the Company successfully completed the construction of 119 emergency
hospitals, including the Wuhan – Huoshenshan Hospital and Leishenshan Hospital,
and was able to play its role and deliver satisfactory results in critical moments. The
Company has always been putting employees’ safety and health first, establishing
RMB a regular pandemic prevention and control mechanism, setting up an pandemic
prevention and control office, and implementing various prevention and control
measures. In light of the continuous spread of the pandemic around the globe,
the Company carried out overseas pandemic prevention and control initiatives,
adhered to the principle of “one country, one policy”, and organized overseas
The Company ranked

18
institutions and projects to prevent and control the pandemic based the actual
situations in different countries and regions, thus safeguarding the safety and health
of its employees in more than 80 countries and regions.
Operating performance grew against the headwinds. During the Reporting
th Period, the amount of the Company’s newly signed contracts exceeded
RMB3 trillion, once again setting a record among its global counterparts in
on the Fortune Global 500 list construction industry in terms of orders. The Company achieved continuous
growth in revenue and profit before income tax with continued sound and stable
business development. The Company achieved revenue of RMB1,615.02 billion,
representing a year-on-year increase of 13.7%, and profit before income taxes of
RMB94.29 billion, representing a year-on-year increase of 15.7%. The Company's

3
weighted average return on net assets (WARA) was 15.54%; the basic earnings
per share (EPS) was RMB1.07, representing a year-on-year increase of 10.3%. The
Company's financial risks were overall controllable with an eased pressure on cash
flows. At the end of the Reporting Period, the asset-liability ratio was kept at 73.7%,
rd representing a year-on-year decrease of 1.7 percentage points.

on the list of Fortune China 500 Support for macro-level strategic development and proactive efforts. The
Company has always been taking serving the national strategy as its most
important political responsibility and the biggest development opportunity, and
demonstrated its role as a central state-owned enterprise to achieve transformation

1
and upgrading and high-quality development while serving the national strategy.
During the Reporting Period, the Company took the initiative to integrate into
national and regional coordinated development strategies such as Beijing-Tianjin-
Hebei Synergistic Development, Yangtze River Economic Belt Development, GBA
Construction, Yangtze River Delta Integrated Development, and Yellow River
st Basin Ecological Protection. The Company focused high-quality resources onto
high-priority sectors, and gave full play to its nationwide presence, and obtained
on ENR’s Top 250 Global new contracts at a total of RMB2,144.2 billion in the above-mentioned regions,
Contractors rankings accounting for more than two-thirds of total values of its new contracts. The
Company has actively adjusted according to the local development strategies and
plans, increased exchanges and cooperation with local governments and peer
central enterprises to jointly promote the implementation of national development

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

strategies, serve the decommissioning of capital function of Beijing, and promote the construction of major projects such
as the Beijing Winter Olympic Stadium, Daxing International Airport, the largest shantytown project in western Beijing, and
the Xiong’an Commercial Service Center. The Company supported the construction of the “five centers” in Shanghai, and
assisted in building a world-class free trade zone in the Lingang New Area. The Company invested RMB59.0 billion in the
historic landscape protection and urban renewal project in the neighborhoods of 67-71 Jianguo East Road, Huangpu District,
Shanghai. The Company fully served the development of quality BRI projects by actively responding to the development
needs of BRI countries, and advancing the key projects under BRI, such as the central business district project in the new
capital of Egypt.
Reform and innovation to deliver excellent performance. In order to implement the three-year reform action of state-
owned enterprises, the Company formulated an implementation plan, focusing on eight aspects of reform and forming a list of
specific tasks. It further clarified the boundaries of the responsibilities of the Party organization, the board of directors and the
management, improved the rules of procedure and the list of decision-making matters, and promoted the deep integration
of the Party’s leadership into corporate governance. The Company has made concrete efforts in promoting special reform
projects, and four subsidiaries have been included in the “Mixed Reform Pilot Project in Important Fields”, “Two-hundred
Campaign” and “Science Reform Demonstration Action”, and seven subsidiaries have implemented the professional manager
system. The Company granted restricted A shares in the phase IV, and broadened the range of participants covered by
the share incentives. The “Management Enhancement Action in Alignment with International Top Level” has established a
comprehensive benchmarking system in business sectors and management areas respectively. The “Six Special Actions”
carried by the Company achieved effective results, solving a number of bottlenecks that restricted high-quality development,
significantly improving the quality and efficiency of production and operation. During the Reporting Period, the Company
actively implemented the deployments of the State Council and the China Securities Regulatory Commission, carried out
special actions on governance of listed companies, continuously improved the level of corporate governance, enhanced the
ability to prevent and resolve risks, and effectively improved the quality of listed companies.
Continued to promote science and technology innovation. During the Reporting Period, various indicators of the
Company hit a record high, including the number of high-end talents in science and technology, the intensity of investment
in science and technology, and the achievements in science and technology research and development. The Company
developed the world’s first “air building-construction machine” and “air tower machine” with independent intellectual property
rights, built the world’s only 10,000-ton multifunctional experimental system, developed world-leading technologies in rapid
construction of anti-pandemic hospital and “five bridges at the same rotation” technology, setting a number of new world
records. The prefabricated hospital building and rapid construction technology played a key role in the construction of the
Wuhan – Huoshenshan Hospital and Leishenshan Hospital, and three corporate technical standards, including “Standard
for Construction of Emergency Hospital Engineering Project against Pandemic” prepared by the Company, were officially
released to provide the community with green, healthy, efficient and environmental friendly public health medical engineering
product system and industrialized services, standardized solutions for a sound public health emergency management and
treatment system. The Company is one of the first central enterprises in the industry to conduct prefabricated construction
business. It has a wide presence in steel structure, precast concrete, etc., and has a competitive advantage in the entire
industry chain from design to construction. The Company’s precast concrete business adheres to the five-in-one business
model to drive the development of EPC. It has a green assembly building intelligent construction platform with independent
intellectual property rights, the first of its kind in China, and an advanced fully automatic smart precast factory.
A responsible corporate citizen. With the paired-up assistance in poverty alleviation by China State Construction, the
controlling shareholder of the Company, three counties in Gansu (Zhuoni, Kangle and Kangxian) were removed from the
poverty-stricken counties list, and the Company won the highest-grade rate in the poverty alleviation assessment of central
entities for three consecutive years. As a reward to investors, we proposed to pay 2020 cash dividends in an amount of
about RMB9 billion to ordinary shareholders. We provided job opportunities for 28,000 graduates and more than 2 million
workers, making an important contribution to stabilizing employment. The Company thoroughly implemented the Regulation
on Ensuring Wage Payment to Migrant Workers of the State Council by paying migrant workers’ wages in full, and drove the
common development of upstream and downstream enterprises, including private enterprises. The Company maintained “zero
arrears” by paying private enterprise as agreed, reduced or exempted rents, and exempted highway tolls, so as to support
small, medium and micro enterprises and individual industrial and commercial households to tide over the difficulties.
For details, please refer to V “Key Business Data” and VI “Key Earnings Results” under Section III “OVERVIEW OF BUSINESS
OPERATION” hereof.

(I) Analysis of principal business

Analysis of changes in related items in the income statement and cash flow statement

Unit: ’000 yuan  Currency: RMB

Amount of the
Amount in the Change ratio
Items same period
current period (%)
last year
Revenue 1,615,023,327 1,419,836,588 13.7
Cost of sales 1,440,131,634 1,262,226,200 14.1
Selling and distribution expenses 5,522,266 4,330,826 27.5
General and administrative expenses 28,982,939 27,685,477 4.7
Research and development expenses 25,522,546 17,289,939 47.6
Finance expenses 7,797,699 7,911,711 -1.4
Net cash flows from operating activities 20,271,781 -34,220,077 /
Net cash flows from investing activities -52,627,785 -19,812,811 /
Net cash flows from financing activities 30,818,051 26,307,910 17.1

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Reason for changes in revenue: In recent years, the value of the Company’s new contracts has maintained a
relatively high growth rate, and the projects under construction have been smoothly advanced, especially the
housing and infrastructure business. The annual revenue increased by RMB128.73 billion, accounting for 66.0% of
the increased amount in the Company’s revenue.
Reason for changes in cost of sales: The expansion of business scale led to the increase in the cost of sales
accordingly.
Reason for changes in selling and distribution expenses: The Company’s real estate business increased
advertising investment during the pre-sale period, and the corresponding advertising fees and business promotion
fees, business fees and sales commissions grew rapidly.
Reason for changes in general and administrative expenses: Such expenses as employee remuneration,
property management fees and depreciation fees increased due to the expansion of business scale as well as the
increase in management personnel and business activities.
Reason for changes in research and development expenses: The increase in expenses during the Reporting
Period was due to the Company’s increased investment in R&D.
Reason for changes in finance expenses: The decrease in expenses during the Reporting Period was due to the
increase in foreign exchange income over last year.
Reason for changes in net cash flow from operating activities: It was due to the increase in payments received
for construction projects and collection of payments from sales of real estate projects, the improvement in cash
flows from the principal construction business and real estate business during the period.
Reason for changes in net cash flow from investment activities: It was due to the decrease in cash received
from recovering our investments, and cash received in respect of investment return and the increase in cash paid
for investment business in the current period.
Reason for changes in net cash flow from financing activities: It was mainly due to the increase in the amount
of fund inflows from absorbing investments, the issuance of perpetual bonds and long-term borrowings during the
period.

1. Analysis of revenue and cost

√ Applicable   N/A
In 2020, the Company delivered revenue of RMB1,615.02 billion, an increase of 13.7% year-on-year; with
cost of sales at RMB1,440.13 billion, an increase of 14.1% year-on-year. The Company recorded a gross
profit of RMB174.89 billion, an increase of 11.0% year-on-year; a gross profit margin of 10.8%, a decrease
of 0.3 percentage points as compared to the same period last year.
For details related to income recognition methods, please refer to Note III. 34 “Significant Accounting
Judgement and Estimates” to the financial statements under Section XI “FINANCIAL REPORT” hereof.

(1). Principal business by industry, product and region

Unit: ’000 yuan  Currency: RMB

Principal business by industry

Gross profit Change YoY Change YoY Change YoY of

By industry Revenue Cost of sales margin of revenue of cost of sales gross profit margin
(%) (%) (%) (%)
Housing construction 0.3 percentage
1,001,101,026 933,774,639 6.7 14.8 14.3
engineering points increased
Infrastructure construction
348,435,361 318,931,135 8.5 9.5 9.6 /
and investment
Real estate development 4.9 percentage
271,292,353 200,162,296 26.2 25.0 33.9
and investment points decreased
5.8 percentage
Prospecting and design 10,607,297 8,039,404 24.2 7.2 -0.4
points increased
3.3 percentage
Others 21,321,634 15,494,857 27.3 -10.4 -6.3
points decreased
Elimination -37,734,344 -36,270,697 / / / /

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Principal business by region

Gross profit Change YoY Change YoY of Change YoY of

By region Revenue Cost of sales margin of revenue cost of sales gross profit margin
(%) (%) (%) (%)

0.7 percentage
Mainland China
1,525,382,093 1,358,824,509 10.9 15.9 16.8 points decreased

Overseas note 4.1 percentage

89,641,234 81,307,125 9.3 -13.8 -17.5 points increased

0.3 percentage
Total
1,615,023,327 1,440,131,634 10.8 13.7 14.1 points decreased

Note: “Overseas” refer to the regions other than Mainland China.

Unit: ’000 yuan  Currency: RMB

Revenue and its proportion in the last three years

Proportion Proportion Proportion

By industry 2020 2019 2018
(%) (%) (%)

Housing construction
1,001,101,026 62.0 872,366,117 61.4 724,230,782 60.3
engineering

Infrastructure
construction and 348,435,361 21.6 318,105,335 22.4 276,675,284 23.1
investment

Real estate
development and 271,292,353 16.8 216,979,828 15.3 184,112,490 15.4
investment

Prospecting and
10,607,297 0.7 9,894,280 0.7 9,436,215 0.8
design

Others 21,321,634 1.3 23,800,895 1.7 20,750,371 1.7

Elimination -37,734,344 -2.4 -21,309,867 -1.5 -15,880,617 -1.3

Total 1,615,023,327 100 1,419,836,588 100 1,199,324,525 100

Explanation on principal business by industry, product and region

√ Applicable   N/A

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

• Housing construction engineering business

During the Reporting Period, the Company’s housing construction business grew steadily and continued to lead the mid-
to high-end markets. The total value of new contracts for the whole year was RMB2,077.9 billion, an increase of 6.5% year-
on-year with revenue at RMB1,001.1 billion, an increase of 14.8% year-on-year; gross profit was RMB67.3 billion, with a
gross margin of 6.7%, an increase of 0.3 percentage points year-on-year.
During the Reporting Period, the Company fully leveraged its competitive edge in respect of whole industrial chain
and sticked to the marketing strategy featuring “high-end market, high-end customers and high-end projects” and the
enterprise management strategy of “low-cost competition and high-quality management”. The Company made sustained
efforts to enhance its competitive strength in the field of high-end housing construction such as super high-rise and large-
span construction, and fully mastered the core technology of “high, large, precise and top-class” housing construction.
The Company won six bids for super high-rise projects over 300 meters, and completed the construction for Suzhou
International Finance Center, which is the 18th in the world and the 10th in China, continuing to setting the “China speed”
in respect of super high-rise construction. Meanwhile, the Company ensured the smooth delivery of the world’s largest
quantum information laboratory, the No. 1 Research Building of the Innovation Institute of Quantum Information and
Quantum Science and Technology of the Chinese Academy of Sciences, and the renovation and expansion project of the
Capital Gymnasium, etc.
During the Reporting Period, the Company further enhanced its competitive advantages in the field of high-end housing
construction, such as medical facilities, exhibition centers and industrial plants, and educational facilities. In terms of
medical facilities, the new contracts amounted to RMB124.8 billion, representing a year-on-year increase of 101.8%.
In addition to the Wuhan Huoshenshan Hospital and Leishenshan Hospital, we also undertook the construction of 117
emergency hospitals including the relocation and reconstruction project of Shantou Central Hospital (major pandemic
case treatment base). In terms of construction of exhibition centers and industrial plants, the new contracts amounted
to RMB187.9 billion, an increase of 46.9% year-on-year. The Company undertook a series of exhibition center projects,
including the National Convention and Exhibition Center (Tianjin) Phase II Project, the Xi’an High-tech International
Convention Center Phase II Project, the EPC general contracting of the Ningbo International Convention Center Project
in Zhejiang Province. In addition, industrial plant projects undertook by the Company included EPC general contracting
of the Made in China 2025 Industrial Park Construction Project (Phase II), the main plant project of production line of
the Changsha Huike (长沙惠科) 8.6 generation ultra-high-definition new display device components, and the general
contracting of Great Wall International Logistics Center in Shenzhen, Guangdong Province. In terms of the construction of
education facilities, the new contracts amounted to RMB100.9 billion, representing a year-on-year increase of 42.5%. The
Company undertook the EPC general contracting (section I) project of a general high school construction project in Yunnan
Province and the design and construction general contracting (EPC) project of the Guangzhou International Campus
Phase II of South China University of Technology (the First Batch). Meanwhile, as the Company actively participated in the
building-up of new urbanization, it undertook the Section I of the EPC general contracting project for the construction of the
Kexue Valley Digital Town in Zhengdong New District, Zhengzhou, Henan Province, the general contracting project for the
construction of an intelligent and healthy living area in Xishan Area, Laoshan District, Qingdao, Shandong Province, and
the urban renovation project in Zaoyuansu Village adjacent to the Bypass Expressway in Baqiao District, Xi’an, Shaanxi
Province in celebration of the 14th National Games of China.
During the Reporting Period, the Company fulfilled its technological leadership in housing construction and increased
the use of green building, BIM technology and new materials. As a leading enterprise in green construction in China,
the Company’s modular integrated construction (MiC) technology for prefabricated building is among the industry-
leading level. Specifically, when the component parts of buildings are produced in intelligent and specialized factories
and delivered to the construction site, each modular composite has already met the standard ready for fine decoration
before moving in. The North Lantau Hospital Hong Kong Infection Control Center, which has been opened, is the world’s
first infectious disease hospital with totally negative pressure isolation wards adopting MiC construction technology. The
Company made further R&D investments in intelligent construction sites and smart construction control software system,
with a view to applying the 5G technology to construction process of premium projects and giving support to optimized
performance of project through digital service model. The Company’s first manufacturing base based on its independently-
developed BIM intensive processing of steel reinforcement was completed in Hubei Province. The Company independently
developed the “one-stop security remote inspection system”, which, together with the 5G technology and smart helmets,
helped to improve the efficiency of safety inspection.

• Infrastructure construction and investment operations

During the Reporting Period, the Company achieved rapid growth in the scale of its infrastructure business and continued
to optimize the adjustment of its business structure. To stimulate the high-quality development of infrastructure business,
and maintain a reasonable gearing ratio, the Company has entered into new infrastructure contracts with a total value
of RMB679.8 billion for the whole year, an increase of 30.1% year-on-year. It recorded revenue of RMB348.4 billion, an
increase of 9.5% year-on-year; and the gross profit amounted to RMB29.5 billion, an increase of 8.8% year-on-year with a
gross profit margin of 8.5%, in line with last year.
During the Reporting Period, the Company focused on its competitive strengths in infrastructure investment and
construction business and won a number of bids of major infrastructure projects. In terms of airport construction, the
Company continued to reaped substantial fruits by winning the bid for the T3B terminal of Chongqing Jiangbei Airport, the
regional transportation hub of BRI; in terms of rail transit transportation, the Company further reinforced and improved its
performance, in particular, winning the bid for Xi’an Metro Line 8 project, Metro Line 16 Phase I project, Nanjing Metro Line
9 Phase I project, Hefei Rail Transit Line 7 Phase I project, Dalian Metro Line 4 project, etc.; in terms of railway construction,
the Company won bids for the civil works project of the Laixi-Rongcheng railroad, and the new Lanzhou-Zhangye Line
No. 3 & No. 4 High-speed Railway project, and the Qianhai-Huanggang Port section project of Guangdong-Dongguan-
Shenzhen intercity railway; in terms of municipal highway, the Company focused on major projects and won bids for the

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Nantong bypass expressway project which is among the key projects for the integrated development of Yangtze River
Delta region and the Chongqing-Hunan Double-track Line expressway project. The Company also reached a new level in
terms of urban development. The Company won a number of significant projects including underground space project in
the core area of Fuzhou Binhai New City (the third largest TOD project in China) and the composite development project
of Ningxiang High-speed railway new city in Changsha. The Company actively explored the deployment of new kind of
infrastructure. Specifically, as we enhanced cooperation with top enterprises in the field of communication and Internet, we
won the bids for Zhangbei data center, Alibaba Inner Mongolia cloud computing data center, etc.
During the Reporting Period, the Company closely followed the national development strategies and policies and
continued to contribute “China Construction Power” to the “tackling areas of weakness” in the field of national infrastructure
construction. Xiong’an high-speed railway station of which the Company undertook the construction was officially put into
use; the first generating unit of Jinggangshan Navigation and Power Hub Project on the Ganjiang River, as the first large-
scale waterway project we had ever undertaken, was successfully connected to the electrical grid system and generated
electricity power. Among the railway and bridge projects undertook by the Company, the Shanghai-Suzhou-Nantong
Railway, Weifang-Rongcheng High-speed Railway, Baiyin-Zhongchuan primary highway main line of G341, the renovation
and expansion project of Beijing-Shanghai Expressway and the expansion project of Zhaoqing Bridge have officially been
opened in succession, contributing to the regional development strategies of our country. In terms of subway projects,
Zhengzhou Metro Line 3 Phase I, Nanning Metro Line 4 and the northern section of Qingdao Metro Line 8 have been
opened in succession; a number of major projects completed milestone stage of construction as scheduled, including the
Xuzhou Metro Line 3, Changnan Avenue in Nanchang and Dapu Expressway in Guangxi, laying the “CSCEC foundation”
for the “new infrastructure, new urbanization initiatives and major projects” strategy of China.

• Real estate development and investment business

During the Reporting Period, the real estate business achieved contract sales of RMB428.7 billion throughout the year,
representing a year-on-year increase of 12.1%, and contracted sales area of 23.70 million square meters, a year-on-year
increase of 9.1%; revenue amounted to RMB271.3 billion, representing a year-on-year increase of 25.0%; and gross profit
amounted to RMB71.1 billion with a gross profit margin of 26.2%, representing a year-on-year decrease of 4.9 percentage
points.
During the Reporting Period, the Company delivered a new construction area of 26.83 million square meters, representing
a year-on-year increase of 29.1%; a completed area of 27.54 million square meters, representing a year-on-year increase
of 20.7%; and an area under construction of 69.89 million square meters, representing a year-on-year increase of 7.4%.
During the year, the newly acquired land bank was 20.42 million square meters, and the land bank at the end of the period
was approximately 116.37 million square meters. Over 70% of the Company’s real estate inventory is concentrated in first-
line and provincial capital cities.
After years of development, the Company currently owns 12.54 million square meters of investment properties
encompassing office buildings, hotels, apartments, commercial real estate and others, with a net book value of RMB92.28
billion, accounting for 4.2% of the Company’s total assets. During the Reporting Period, the investment property recorded
revenue of RMB5.87 billion. The Company accelerated the upgrading of industry, expanded business areas such as
commerce, pension, education, and logistics, continuously enhancing the operation and management and profitability of
investment properties. The abovementioned data of investment properties has not been audited.
During the Reporting Period, amid the severe impact of the pandemic, China Overseas took proactive measures in
response to the increased instabilities and uncertainties and strived to maintain secured momentum of growth. During
the Reporting Period, China Overseas delivered a faster sales growth over the overall industry and the greatest amount
of investments in land equity in the industry. China Overseas's GFA of newly land bank increased by a total of 13.49
million square meters. Furthermore, we successfully won the bids for a series of ultra large projects including Shanghai
Hongqi Village, Wuhan Hanyang Jianqiao and Shanghai Jianguo Road East, each of which has a GFA exceeding one
million square meters. Leveraging on the competitive edge in respect of compliance with the “three red lines” indicators,
China Overseas seized the opportunities of rapidly evolving upstream and downstream industry chains brought about
by rapid advances in technology and promoted the development of new business models and new business categories
such as commercial properties, education and retirement, logistics to expand new room of development while focusing
on accelerating the development of the principal business of residential development. Regarding commercial properties,
China Overseas has responded to the opportunity arising from market consolidation and revaluation of commercial assets
and promoted the management model featuring “investment, financing, management and exit”. Specifically, the Company
acquired China Overseas Fortune Center in Suzhou and Foshan Vivo City Shopping in the last two years, and sold two
office buildings of China Overseas International Centre in Chengdu. In addition, the Company also successfully issued two
tranches of commercial mortgage-backed securities (CMBS) to raise RMB6.7 billion. In 2020, China Overseas recorded
revenue from commercial asset management of RMB4.4 billion.
During the Reporting Period, CSC Land actively responded to the challenges arising from the pandemic and maintained
stable growth in scale and efficiency. The contract sales amounted to RMB132.7 billion, an increase of 14.7% year-on-
year. CSC Land upheld a prudent financial strategy, and strictly controlled its debt ratio to ensure the steady development
of its real estate business under the guidance of financial regulatory policies. CSC Land also took measures including
closely evaluating and assessing the market forecast, enhancing product values, further destocking, further regulating
the full-cycle management of real estate projects and speeding up the recovery of funds, mainly the funds in connection
with sales of properties. In respect of selection of city, CSC Land prioritized large and medium-sized cities with small
inventories and strong purchasing power; in respect of selection of district, CSC Land gave priority to core locations
where moderate residential-based projects with fairly comprehensive facilities and a high turnover rate are located. As the
business operation and management has been developing steadily, CSC Land – Meilanfang (梅澜坊) project, which is
operated and managed by the Company, has been awarded as a national 3A grade tourist attraction.
For details, please refer to “Properties under development” and “Completed properties for sale” in Note V 8 “Inventories”
and “Pre-sales deposits” in Note V 29 “Contract liabilities” to the financial statements under Section XI “FINANCIAL
REPORT” hereof.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

• Prospecting and design business

During the Reporting Period, the Company’s prospecting and design business was improved in quality and quantity.
During the year, the new contracts amounted to RMB14.3 billion, an increase of 9.1% year-on-year; revenue amounted to
RMB10.6 billion, an increase of 7.2% year-on-year; gross profit amounted to RMB2.6 billion, with a gross profit margin of
24.2%, an increase of 5.8 percentage points year-on-year.
During the Reporting Period, the Company continued to promote the building of a design-centered industrial chain,
actively expanded its engineering consulting business, and built a design industry system with full-field coverage, full-
process services, full-value chain, and full-element growth with a view to enhance and improve our prospecting and design
business. The Company took the lead to complete a variety of outstanding design works such as Chongqing Jiangbei
Airport, Zhengzhou Xinzheng Airport and Dunhuang Grand Theatre. The Company ranked 30th on the ENR “Top 150
Global Engineering Designs” in 2020 with the competitiveness of the industry continuously enhanced.
During the Reporting Period, the Company fulfilled its competitiveness in the segments including urban planning,
transportation facilities and sports facilities, and undertook the design of relevant projects. In terms of urban planning, the
Company won the bids for the future community planning of Tianchuan, Zhejiang, land space planning of Hetian, Xinjiang,
land space planning of Pingyang, Gansu, in-depth urban design of Chengdu 5G intelligent pioneer zone, global talent
innovation park – Zhongyuan Science and Technology City, etc. In terms of transportation facilities, the Company won the
bids for the engineering design of T3B terminal and fourth runway of Chongqing Jiangbei International Airport, the Xi’an
Xianyang International Airport phase III project, Yuyang Airport expansion project phase II in Yulin, the overall planning of
the roadside area and the design of public transportation facilities of New Phnom Penh International Airport in Cambodia,
TOD transportation complex of Shaoxing High-speed Railway North Station and so on; in terms of sport facilities, we won
the bids for the 14th National Games (equestrian) venue and supporting facilities, the construction project of Luoyang
Olympic Center, Chongqing Longxing Football Stadium and Qingdao Youth Football Stadium.

• Overseas business
During the Reporting Period, the Company coordinated pandemic prevention and control as well as production and
operation of overseas business. There was no confirmed COVID-19 case due to group gatherings in the Company's
overseas entities and projects. Due to the impacts of COVID-19 on production and operation activities, the new contracts
for overseas business amounted to RMB187.2 billion, same level as last year; revenue was RMB89.6 billion, representing a
year-on-year decrease of 13.8%; and gross profit amounted to RMB8.3 billion with a gross profit margin of 9.3%.
During the Reporting Period, upholding the philosophy of “putting people and life first”, the principle of “one country and
one policy” and “one project and one policy”, the Company implemented the policy in a precise manner and the pandemic
prevention and control in a strict and detailed manner in respect of overseas business. Firstly, the Company had in place
an overseas pandemic prevention and control working group, 14 country-specific pandemic prevention and control joint
working mechanism and 24-hour emergency contact mechanism, forming an overseas pandemic prevention and control
working system. Secondly, the Company dispatched a medical working group to countries where pandemic had severely
hit and we had a relatively large number of employees, including Egypt, Algeria, Cambodia, Ethiopia and so on, to
improve our front-line pandemic prevention and control capability. Thirdly, we set up a special fund designed for overseas
pandemic prevention and control initiatives, in an attempt to safeguard the material supplies and medical protection in
place for pandemic control of overseas entities. Fourthly, shift of overseas employees was arranged in an orderly manner
to comply with the “prevention of imported cases” requirement. Fifthly, the Company gave attention and affection for
employees to safeguard the stability of workforce. The lives, safety and health of the Company's foreign and Chinese
employees abroad were strongly safeguarded, and the Company had no record of COVID-19 confirmed cases occurred
due to group gatherings in overseas entities and projects in more than 100 countries.
During the Reporting Period, the Company actively responded to the volatile international engineering market, fulfilled
its market-oriented competitive advantages, enhanced market expansion efforts, and made solid progress in overseas
market expansion. The year 2020 saw the Company tap into four new country markets, including Peru, Chile, El Salvador
and Madagascar, and successfully entered into a series of contracts concerning various major projects, such as the first
subway Makati Metro Transit Project in the Philippines and the new Phnom Penh International Airport in Cambodia (the
world’s highest 4F airport).
During the Reporting Period, while ensuring that pandemic prevention and control measures were strictly carried out, the
Company spared no effort to proceed with the performance of overseas projects by overcoming restrictions on the cross-
border flow of personnel, materials and machinery. A large number of construction projects under the BRI in connection
with national economy and people’s livelihood made significant progress. In the capital of Egypt, the construction of eight
high-rise buildings in the new central business district have been completed, the construction progress of which has
been appreciated by the property owners; in Pakistan, the PKM Expressway project (Sukkur-Multan section) was officially
handed over and put into use, opening the north-south traffic artery through the central Pakistan; in Algeria, the third
largest mosque in the world, the Grand Mosque, was opened; in Algeria, the north-south traffic artery project - the 53KM
section of the Algerian North-South expressway project was opened to traffic ahead of schedule.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

• Other business
Other business of the Company mainly includes the income from primary land development, lease of machinery equipment
and engineering supervision and management. During the Reporting Period, revenue was RMB21.3 billion, a decrease
of 10.4% year-on-year; gross profit amounted to RMB5.8 billion, with a gross profit margin of 27.3%, a decrease of 3.3
percentage points year-on-year.
For details, please refer to Note V 49 “Revenue and cost of sales”, Note V 61 “Expenses by nature” and Note XIV 1 “Segment
reporting” to the financial statements under Section XI “FINANCIAL REPORT” hereof.

(2). Analytical statement on production and sales

 Applicable  √ N/A

(3). Analytical statement on costs

Unit: ’000 yuan  Currency: RMB

By industry

Changes in
Percentage Percentage the amount
of total of total cost of the current
Amount of the
Components of Amount in the cost in the in the same period over
By industry same period of
operating cost current period current period last the same
last year
period year period last
(%) (%) year
(%)

Housing Raw materials,

construction subcontract costs, 933,774,639 64.8 816,661,197 64.7 14.3
engineering labor costs, etc.

Infrastructure Raw materials,

construction and subcontract costs, 318,931,135 22.1 290,979,462 23.1 9.6
investment labor costs, etc.

Construction and
Real estate
installation costs,
development and 200,162,296 13.9 149,490,891 11.8 33.9
land costs, labor
investment
costs, etc.

Prospecting and Labor costs, rental

8,039,404 0.6 8,071,133 0.6 -0.4
design of equipment

Labor costs, rental

Others 15,494,857 1.1 16,529,092 1.3 -6.3
of equipment

Elimination / -36,270,697 -2.5 -19,505,575 -1.5 /

Total / 1,440,131,634 100 1,262,226,200 100 14.1

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: ’000 yuan  Currency: RMB

Main cost components

Components of Proportion Proportion Proportion

By industry 2020 2019 2018
operating costs (%) (%) (%)

Cost of sales from

21,545,271 1.5 19,855,211 1.6 17,010,696 1.6
products

Subcontracting cost 300,894,270 20.9 257,717,240 20.4 233,507,557 22.1

Housing
construction Raw materials 286,112,366 19.9 277,250,496 22.0 234,397,731 22.2
engineering Employee benefits 31,128,794 2.2 27,718,240 2.2 25,908,266 2.5

Other expenses 294,093,938 20.3 234,120,010 18.5 165,034,946 15.7

Sub-total 933,774,639 64.8 816,661,197 64.7 675,859,196 64.0

Cost of sales from

– – – – – –
products

Subcontracting cost 115,931,326 8.1 126,131,695 10.0 114,807,022 10.8

Infrastructure
construction and Raw materials 84,942,618 5.8 87,967,301 7.0 79,415,185 7.5
investment Staff cost 46,293,060 3.2 36,660,547 2.9 26,299,140 2.5

Other expenses 71,764,131 5.0 40,219,919 3.2 32,844,887 3.2

Sub-total 318,931,135 22.1 290,979,462 23.1 253,366,234 24.0

Carry-over of real
estate development 190,935,051 13.3 142,772,220 11.4 113,717,202 10.8
Real estate
products
development
and investment Other expenses 9,227,245 0.6 6,718,671 0.4 5,956,882 0.5

Sub-total 200,162,296 13.9 149,490,891 11.8 119,674,084 11.3

Prospecting
Sub-total 8,039,404 0.6 8,071,133 0.6 7,739,985 0.7
and design

Others Sub-total 15,494,857 1.1 16,529,092 1.3 14,644,604 1.4

Elimination / -36,270,697 -2.5 -19,505,575 -1.5 -14,574,513 -1.4

Total 1,440,131,634 100.0 1,262,226,200 100.0 1,056,709,590 100

Explanation on other information of cost analysis

 Applicable  √ N/A

(4). Major customers and suppliers

√ Applicable   N/A
In 2020, the revenue generated from/sales to the top 5 customers of the Company was RMB17.18
billion, accounting for 1.1% of the total revenue/sales of the year. Among the sales to the top five
customers, the sales to related parties was nil, accounting for nil of the total sales for the year.
During the Reporting Period, the amount of procurement from the top 5 suppliers was RMB22.511
billion, accounting for less than 1.6% of cost of sales. Among the amount of procurement from the
top 5 suppliers, the amount of procurement from related parties amounted to nil, accounting for nil
of the total amount of procurement for the year.
The Company’s business scale and its diversified business structure determine that the Company’s
suppliers are more extensive and less concentrated, and the public bidding with minimum
restrictions is used for the procurement of bulk materials, which ensures the supply of resources
and avoids the Company’s reliance on a single supplier.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

2. Expenses
√ Applicable   N/A
In 2020, the Company’s selling and distribution expenses, general and administrative expenses, finance expenses
and R&D expenses totaled RMB67.83 billion, a year-on-year increase of 18.5%. The four items of expenses
accounted for 4.2% of revenue, a year-on-year increase of 0.2 percentage points.
During the Reporting Period, the Company’s selling and distribution expenses were RMB5.52 billion, an increase
of 27.5% year-on-year, mainly due to the increase in advertising and promotion fees as a result of the expansion of
the real estate business.
During the Reporting Period, the Company’s general and administrative expenses were RMB28.98 billion, an
increase of 4.7% year-on-year, mainly due to the expansion in scale of business, and the increase in employee
remuneration, property management fees and depreciation costs in line with the increase in management
personnel and business activities. The Company’s general and administrative expenses accounted for 1.8% of
the revenue, that is, the general and administrative fee was RMB1.8 for each RMB100 of income. The Company’s
cost management and control delivered remarkable result, and it continued to maintain a leading position in the
industry.
During the Reporting Period, the Company’s finance expenses were RMB7.80 billion, a year-on-year decrease of
1.4%. The was mainly due to the increase in foreign exchange income over last year.
During the Reporting Period, the Company’s R&D expenses amounted to RMB25.52 billion, an increase of 47.6%
year-on-year, mainly due to the higher R&D investment in technology.
For details, please refer to relevant information as set out in Note V 51 “Selling and distribution expenses”, Note
V 52 “General and administrative expenses”, Note V 53 “Research and development expenses” and Note V 54
“Finance expenses” to the financial statements under Section XI “FINANCIAL REPORT” hereof.

3. Investments in research and development

Table of investment in research and development
√ Applicable   N/A
Unit: ’000 yuan  Currency: RMB

Investment in research and development expensed during the period 29,391,759

Investment in research and development capitalized during the period /

Total investment in research and development 29,391,759

Total investment in research and development as a percentage of total revenue (%) 1.8

Number of research and development personnel 21,845

Number of research and development personnel as a percentage of total employees (%) 6.1

Percentage of investment in research and development capitalized (%) /

Explanation
√ Applicable   N/A
In recent years, the Company has been further implementing the innovation-driven development strategy, carrying
out special actions for scientific and technological innovation, making important achievements in the R&D and
promotion of core equipment and technologies, and continuously enhancing the core competitiveness of the
enterprise.
During the Reporting Period, the Company continued to increase the R&D efforts and investment in major
engineering construction equipment. In 2020, the Company’s independently developed the civil engineering
experimental equipment “CSCEC 10,000-ton multifunctional experimental system” which has the world’s strongest
loading capacity, the largest loading space and the most advanced functions was officially put into use. The
maximum vertical loading capacity of 10,800 tons enabled the said system the world’s only six-degree-of-freedom
engineering structure experimental equipment with a vertical loading capacity of over ten thousand tons, solving
the problem of “capacity effect” facing engineering experimental equipment in China; the construction of the first
1,000-meter long Yangtze River Bridge project – Yichang-Wujiagang Yangtze River Bridge project undertaken
by the Company used the independently-developed air tower-building machine to complete the construction of
main tower, making a significant breakthrough in technology innovation equipment in the field of infrastructure; in
Chongqing, the second cross-line project of the expressway made a breakthrough in the technology in connection
with the “three lines and five bridges” cluster turning, setting a new world record of “the largest number and
tonnage of large-span cluster turning bridges”; plant-alike “building-construction machine” was successfully

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

applied to the CSCEC Yuhu No. 1 (御湖壹号) project in Chongqing, indicating our country’s transition in housing
construction from skyscrapers to super high-rise buildings and to high-rise buildings within the height of 100
meters by using the heavy equipment “air building-construction machine”. The cutting-edge technological results
of the Company's R&D have been gradually and widely applied to regular housing projects, benefiting a variety of
projects currently.
During the Reporting Period, the Company continually strived to overcome difficulties facing key core technologies
and made breakthroughs in the technologies of rapid construction of super high-rise and assembly buildings,
connection technology for assembly concrete structure, engineering intelligent equipment, construction in
extreme environment, digital steel processing and 5G intelligent remote control. The Company took the lead
in developing new and efficient “dry” assembly technology and formed a prefabricated prestressed Efficient
Fabricated Frame (CSCEC PPEFF system) with independent intellectual property rights, which has passed the
world’s largest continuous collapse resistance experiment and can achieve rapid construction of two floors in five
days. The Company’s first digital steel BIM intensive processing base went into full production. Its 5G intelligent
remote-control tower made significant progress, and in reliance on the Beijing Daxing Lingkong Economic Zone
Development Service Center project, successfully passed the first indoor remote control tower hoisting test based
on the 5G environment in the construction site in the industry. A breakthrough was made in the application of single
tower multi-cage elevator, which entered the application stage in engineering. Core construction technologies,
such as “construction technology of giant concrete cross columns in net cylinder super high rise” and “construction
technology of infrastructure in dry and hot areas”, gave strong support for the overseas market; super early-
strength, low-heat, ultra-high-pumping concrete formulation technology was applied to the North Africa projects for
the first time, setting a record of concrete application strength and pumping height in the local market.
The Company continues to leverage on its leading edge in technology, actively cultivates and promotes scientific
and technological achievements, and improves relevant technical standard systems. In 2020, the Company was
granted 8,951 patents, including 505 invention patents, and 555 new technologies for the construction industry
were promoted within the Company. The Company took a leading role in developing 6 full-text mandatory national
standards, compiled and issued 3 national standards (including the Code for Acceptance of Construction Quality
of Steel Structure), and 1,732 of its engineering methods were accredited at province and ministry levels.

4. Cash flows
√ Applicable   N/A
During the Reporting Period, the Company’s net cash outflow was RMB3.9 billion, a decrease of net outflow
RMB23.2 billion from the net outflow of RMB27.1 billion last year.
The Company’s net cash outflow from operating activities was RMB20.3 billion, mainly due to the increase in
project payments received and recovery of funds from real estate sales activities and the improvement in cash
flows from the principal construction business and real estate business during the period. The Company received
cash from sales activities at a rate of 106.1%, a year-on-year increase of 0.2 percentage points, and the cash
recovery of operating activities continued to strengthen.
The Company’s net cash outflow from investment activities was RMB52.6 billion, a year-on-year increase in net
outflow of RMB32.8 billion. This was mainly due to the decrease in cash received from investment recovery and
cash received from investment income and the increase in cash expenses in investment.
The Company’s net cash inflow from financing activities was RMB30.8 billion, a year-on-year increase in net inflow
of RMB4.5 billion, mainly due to the increase in cash received from investment, issuance of perpetual bonds and
long-term borrowings.
For details, please refer to relevant information as set out in Note V 64 “Notes to the consolidated cash flow
statement” and Note V 65 “Supplementary information to the consolidate cash flow statement” to the financial
statements under Section XI “FINANCIAL REPORT” hereof.

5. Financing
During the Reporting Period, the face value of the Company’s newly issued bonds totaled approximately RMB21.6
billion. The Company was dedicated to satisfy the financial needs of relevant entities in pursing the pandemic
prevention and control measures, resumption of work and production and business development by introducing “ten
financial measures”, setting up special loan pools, providing access to green approval channels, and providing a
reserve of financial resources.
In order to actively implement the decision-making of the Party Central Committee and the State Council on
deepening the reform of SOEs, and respond to the guidance of the SASAC of the State Council on market-oriented
legalization of debt-to-equity swaps, the Company organized part of its three-tier subsidiaries, in cooperation with
investment institutions, to carry out market-oriented debt-to-equity conversion business. The market-oriented debt-
to-equity conversion funds effectively supplemented equity capital for related subsidiaries, and were directly used
to swap external debt, which strongly supported the development of the principal business, while optimizing the
subsidiaries’ governance structure and enhancing its governance capabilities.
As of the end of the Reporting Period, the Company’s total interest-bearing liabilities were RMB500.6 billion, an
increase of RMB37.5 billion from the beginning of the year, and a year-on-year increase of 8.1%. This was mainly
due to the increase in the Company’s business volume, the corresponding increase in long-term borrowings, and
the increase in interest expenses.
During the Reporting Period, the interest payment/redemption of corporate bonds and debt financing instruments
are listed as follows:

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million yuan  Currency: RMB

Whether to pay
Category Abbreviation Issue date Maturity date Amount interest/redeem
normally
15 China
Redemption and
Medium-term Construction April 28, 2015 April 28, 2020 30
interest payment
note MTN001
15 China
November 9, November 9, Redemption and
Medium-term Construction 20
2015 2020 interest payment
note MTN002
16 China
Medium-term Construction April 13, 2016 April 13, 2021 30 Interest payment
note MTN001
17 China
Redemption and
Medium-term Construction April 20, 2017 April 20, 2020 50
interest payment
note MTN001
18 China
Medium-term Construction August 17, 2018 August 17, 2023 50 Interest payment
note MTN001
18 China
Medium-term Construction August 17, 2018 August 17, 2023 50 Interest payment
note MTN002

During the Reporting Period, the bonds issued by the Company’s subsidiaries are as follows:

Unit: 100 million yuan  Currency: RMB/USD

Amount of
Name of bond Issue date Term Amount principal at the Issuer
end of period
March 2, CHINA OVERSEAS FINANCE
CHINA OVS N2503 5 3 (USD) 3 (USD)
2020 (CAYMAN) VIII LTD
March 2, CHINA OVERSEAS FINANCE
CHINA OVS N3003 10 5 (USD) 5 (USD)
2020 (CAYMAN) VIII LTD
March 2, CHINA OVERSEAS FINANCE
CHINA OVS N3503 15 2 (USD) 2 (USD)
2020 (CAYMAN) VIII LTD
Beijing China Overseas
20 China Overseas April 28,
3+3+3+3+3+3 37 (RMB) 37 (RMB) Plaza Commercial
1A 2020
Development Ltd.
20 China Construction July 29, China State Construction
3 20 (RMB) 20 (RMB)
G1 2020 International Holdings Limited
20 China Overseas August 14, China Overseas Development
3+3 20 (RMB) 20 (RMB)
01 2020 Group Co., Ltd.
Beijing China Overseas
20 China Overseas August 17,
5+5+5+3 30 (RMB) 30 (RMB) Plaza Commercial
2A 2020
Development Ltd.
20 China State
Construction October 28, China State Construction
3 5 (RMB) 5 (RMB)
International 2020 International Investments Limited
Investments MTN001
20 China Overseas November 9, China Overseas Development
3 24 (RMB) 24 (RMB)
03 2020 Group Co., Ltd.
20 China Overseas
December 14, China Overseas Development
Development Group 3 15 (RMB) 15 (RMB)
2020 Group Co., Ltd.
MTN001

For details, please refer to relevant information as set out in Note V. 36 “Bonds payable” to the financial statements
under “FINANCIAL REPORT” hereof.

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(II) Operating investment business

During the Reporting Period, the Company completed an investment of RMB438.5 billion, an increase of 8.0%
year-on-year, and the investment business maintained a steady development trend.

Unit: 100 million yuan  Currency: RMB

Amount of
investment during Proportion YoY increase
Classification of projects
the Reporting (%) (%)
Period
By categories of projects
Real estate development 3,109 70.9 11.8
Investment in infrastructure and housing construction 1,102 25.1 0.6
Comprehensive urban development 146 3.3 -3.4
Fixed assets and other investments 28 0.7 -14.5
By continuity of projects
Continued investment projects 2,826 64.4 3.3
New projects in 2020 1,559 35.6 17.9
Total 4,385 100 8.0

Note: The above classification of projects is designed in accordance with industry practices and the Company’s
internal management needs. The classification attributes of some projects will be adjusted according to the actual
circumstances of the project. The year-on-year growth rate in the table will be adjusted retrospectively to the
changed projects accordingly.

• 1. Real estate development business

During the Reporting Period, the investment amount of the Company’s real estate development business
reached RMB310.9 billion, a year-on-year increase of 11.8%; payback of investment return was RMB328.6
billion, a year-on-year increase of 16.1%; and ratio of investment to income was 105.7%, a year-on-year
increase of 3.9 percentage points.

• 2. Business of investment in infrastructure and housing construction

During the Reporting Period, the investment in infrastructure and housing construction of the Company
reached RMB110.2 billion, a year-on-year increase of 0.6%; payback of investment return was RMB46.5
billion, a year-on-year increase of 4.9%; and the income to expenses ratio of investment was 42.2%, a
year-on-year increase of 1.7 percentage points.

• 3. Comprehensive urban construction business

During the Reporting Period, the amount of investment of the Company’s comprehensive urban
construction business reached RMB14.6 billion, a year-on-year decrease of 3.4%; payback of investment
return was RMB15.8 billion, a year-on-year increase of 64.5%; and the income to expenses ratio of
investment was 108.2%, a year-on-year increase of 44.6 percentage points.

• 4. Investment and construction in key regions

The Company resolutely implemented the major decision-making and deployment of the Party Central
Committee and the State Council, took the responsibility as a central enterprise around major national
strategic planning and deployment, actively practised regional coordinated development strategies, and
was deeply involved in the coordinated development of the Beijing-Tianjin-Hebei Region, the development
of the Yangtze River Economic Belt, the construction of the GBA, investment and construction in key
national areas such as the integrated development of the Yangtze River Delta, ecological protection and
high-quality development of the Yellow River Basin. During the Reporting Period, the amount of investment
of the Company in the Beijing-Tianjin-Hebei Region, Yangtze River Economic Belt, GBA, the Yangtze River
Delta, and the Yellow River Basin reached RMB308.63 billion, representing 70.4% of the Company’s overall
investment.

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

• 5. Development of PPP business

In accordance with the national requirements on the regulated development of PPP business, and under
the guidance of national policy, the Company has comprehensively cleared up and rectified the existing
PPP projects, maintained reasonable control of the scale of PPP projects, and adhered to the high-quality
development of PPP business.
During the Reporting Period, the Company won new bids for 18 PPP projects with the project investment
in aggregate of RMB47.8 billion, including an equity investment of RMB15.4 billion, covering business
fields including expressways, railroad engineering and waterway and environmental protection. By the
end of 2020, the Company had a total of 387 PPP projects in progress with the project investment in
aggregate of RMB1,285.18 billion, including an equity investment of RMB626.15 billion, covering business
fields including municipal engineering works, transportation, cultural and sports venues, composite
development of towns and industrial parks, ecological and environmental protection. In accordance with
the national requirements on the regulated development of PPP business, and under the guidance of
national policy, the Company has comprehensively cleared up and rectified the existing PPP projects,
maintained reasonable control of the scale of PPP projects and adhered to the high-quality development
of PPP business. The Company invested in and constructed a number of major landmark projects related
to national economy and people’s livelihood through PPP business, covering the fields of municipal
engineering, transportation, comprehensive development of towns and industrial parks, ecological
construction and environmental protection, which strongly promoted the Company’s steady growth and
structural adjustment. This helped the Company's transformation from a company which is solely engaged
in housing construction business to the world’s largest investment and construction conglomerate, and
enhance the brand influence of CSCEC.
As of the end of 2020, 118 of the Company’s PPP projects was in operation, accounting for 30.41% of
the PPP projects in progress, with the project investment in aggregate of RMB235.32 billion including
an equity investment of approximately RMB158.8 billion, accounting for 25.36%. According to the
category of operating projects, the projects in operation were mainly municipal roads, comprehensive
pipeline network, cultural and sports venues, security housing projects and ecological and environmental
protection. Among them, Zhengzhou Metro Line 3 was successfully opened to traffic under independent
operation, further enriching the business model of the Company’s operating business. In 2020, the
Company further strengthened the operation management of PPP projects and issued the Implementation
Rules for Operation and Management, and a number of subsidiaries set up specific operating entities,
with the operation and management system basically taking shape and the operation and management
capability continuously improved. On the one hand, the Company supervised our subsidiaries to complete
the planning, preparation and filing of operation plans before the projects were opened for operation
period, so as to fully prepare for the operation; on the other hand, in respect of projects in operation,
the Company monitored the operating income, assessment results and performance of government
payments, so as to effectively protect the investment income. In 2020, PPP projects in operation delivered
satisfactory results in evaluation and assessment, particularly, 98.7% of the projects meeting the annual
operation performance assessment and recording payback of investment return of 96.4%. In this regard,
the Company has overcome the adverse impact of the pandemic on the operation of the projects and
consolidated the two responsibilities, namely performance assessment and investment return.

(III) Operating status of the professional sectors

Since the implementation of the “specialization” strategy, the Company has fostered and developed a number
of professional companies with sophisticated management mechanisms, innovative capabilities and core
competencies in their respective specialized fields. The Company split its principal business into 11 professional
sub-sectors, which continued to maintain satisfactory overall development momentum. The total value of new
contracts was RMB459.0 billion, a year-on-year increase of 5.7%; revenue was RMB363.22 billion, a year-on-year
increase of 7.6%; gross profit was RMB24.99 billion, a year-on-year decrease of 8.8%; and operating profit was
RMB12.57 billion, a year-on-year decrease of 14.1%.
Since the implementation of the “specialization” strategy, the Company has fostered and developed a number
of professional companies with sophisticated management mechanisms, innovative capabilities and core
competencies in their respective specialized fields. During the Reporting Period, the Company’s internal division
of specialization and layout became more rational, the synergetic and coordination mechanism was more
sophisticated, and the overall competitive edge became more prominent. Various specialized sectors and related
subsidiaries provided solid support for the Company’s development in the full business area, full life cycle, and
whole industry chain capabilities. The construction scale of China Construction Science and Industry has been
ranked first in the steel structure industry since 2012; the core propane dehydrogenation plant product of China
Construction Industrial & Energy Engineering. Group Co., Ltd. had the largest market share in the world for three
consecutive years, and was awarded “National Single Champion Product in Manufacturing” by the Ministry of
Industry and Information Technology in 2020; the construction scale of glass curtain wall business of China State
Decoration remains its leading position in the industry; China Construction Science & Technology built up more
than 20 modern assembly industry bases across the country, with a total designed assembly capacity of 4 million
cubic meters per year, which can support nearly 50 million square meters of buildings. The world-leading “China
Construction Cloud Tunnel Intelligence” control system of China Construction Intelligence (中建智能) was a
typical application of the Internet of Things technology in the process of control of tunnel underground excavation
construction; China West Construction continued to maintain a leading position in the industry in terms of the
concrete output for commercial use.

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million yuan  Currency: RMB

Name of Amount of new Revenue for YoY Increase Gross profit for YoY Increase Operating profit YoY Increase
Item
sector contracts 2020 (%) 2020 (%) for 2020 (%)
Installation 529 601.5 10.7 31.4 -4.2 19.4 -8.7
Steel
74 218.2 11.7 13.4 -3.4 9.2 65.2
Cross-section structure
Commercial
498 234.2 4.6 27.0 17.5 11.4 42.5
concrete
Housing Decoration 370 332.7 11.0 25.8 14.3 6.4 -23.3
construction Gardening 24 55.4 54.1 3.7 73.9 3.2 222.6
Municipal
913 783.3 15.5 87.6 -8.3 50.7 -6.4
projects
Railways 159 100.8 7.1 -3.1 / -2.4 /
Rail transit 1,165 307.9 1.2 8.1 -17.5 2.3 -59.0
Infrastructure Roads and
640 865.5 -3.8 46.9 -38.8 22.6 -55.3
bridges
Electricity 60 51.3 46.0 2.5 85.0 1.5 /
Port
158 81.3 25.0 6.5 230.0 1.5 /
engineering
Total 4,590 3,632.2 7.6 249.9 -8.8 125.7 -14.1

Gross profit margin (%) Operating profit margin (%)

Names of YoY change YoY change
Item
sector 2020 2019 (Percentage 2020 2019 (Percentage
points) points)
Installation 5.2 6.0 -0.8 3.2 3.9 -0.7
Steel
6.1 7.1 -1.0 4.2 2.8 1.4
Cross-section structure
Commercial
11.5 10.3 1.2 4.9 3.5 1.4
concrete
Decoration 7.8 7.5 0.2 1.9 2.8 -0.9
Housing construction
Gardening 6.7 5.9 0.8 5.7 2.7 3.0
Municipal
11.2 14.1 -2.9 6.5 8.0 -1.5
projects
Railways -3.0 -5.9 2.9 -2.4 -6.4 4.0
Rail transit 2.6 3.2 -0.6 0.7 1.8 -1.1
Infrastructure Roads and
5.4 8.5 -3.1 2.6 5.6 -3.0
bridges
Electricity 5.0 3.9 1.0 2.9 -0.3 3.2
Port
7.9 3.0 4.9 1.8 -2.9 4.7
engineering
Total 6.9 8.1 -1.2 3.5 4.3 -0.9

(IV) Explanation on significant changes in profit arising from non-major business

 Applicable  √ N/A

(V) Analysis of assets and liabilities

√ Applicable   N/A

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 1.  Assets and liabilities
Unit: ’000 yuan  Currency: RMB
Amount as of the end Amount as of the end Change between
Amount as of the end of of the current period as Amount as of the end of of last period as a amounts as of the end

BAR21010002_E_CSCEC 2020AR()_.indb 35
Name of item Remarks
the current period a percentage of total the last period percentage of total of the current period
assets (%) assets (%) and last period (%)
Total assets increased by RMB157.7 billion during the period, mainly due to the
Total assets 2,192,173,839 100 2,034,451,929 100 7.8 increase in inventories and investment properties, which accounted for 74.2% of
the increase in total assets.
The increase in cash and bank balances of RMB3.4 billion in the year was mainly due
Cash and 295,857,190 13.5 292,441,419 14.4 1.2 to the increase in bank deposits as a result of the increase in net cash inflow from
bank balances operating activities and financing activities.
Accounts receivable increased by RMB6.5 billion for the year, which was due to the
Accounts receivable 160,441,814 7.3 153,961,875 7.6 4.2 increase in payment from property owners in line with the increase in business scale.
The decrease in prepayments of RMB12.8 billion for the year was mainly due to the
Prepayments 42,243,346 1.9 55,084,548 2.7 -23.3 decrease in prepayments.
The inventories increased by RMB96.2 billion for the year, mainly due to the increase
Inventories 675,125,328 30.8 578,917,620 28.5 16.6 in properties under development and completed properties for sale.
Contract assets decreased by RMB9.9 billion for the year, mainly due to the increase
Contract assets 141,065,956 6.4 150,975,326 7.4 -6.6 in owner settlements.
Current portion of non-current assets increased by RMB20.5 billion for the year, mainly
Current portion of 77,936,729 3.6 57,463,704 2.8 35.6 due to the increase in warranty deposits due within one year, long-term receivables
non-current assets from investment projects and receivables from primary land development.
Long-term receivables increased by RMB12.8 billion, mainly due to the increase in
Long-term receivables 177,642,042 8.1 164,825,662 8.1 7.8 receivables from investment projects.
Long-term equity Long-term equity investments increased by RMB11.5 billion, mainly due to the increase
86,439,061 3.9 74,916,901 3.7 15.4
investments in investments in associates and joint ventures.
The decrease in investments in other equity instruments of RMB2.2 billion for the year
Investment in other equity 5,838,384 0.3 8,069,043 0.4 -27.6 was mainly due to the decrease in fair value of investments in equity instruments held
instruments at the end of the year.
Investment properties increased by RMB20.8 billion during the year, mainly due to the
Investment properties 97,123,680 4.4 76,301,157 3.8 27.3 increase in properties during the year.
Intangible assets increased by RMB6.15 billion during the year, mainly due to the
Intangible assets 22,558,997 1.0 16,409,157 0.8 37.5 increase in franchise in line with the increase in construction investment.
Other non-current assets decreased by RMB8.0 billion, mainly due to the transfer of
Other non-current 139,945,933 6.4 147,948,942 7.3 -5.4 investment projects held under financial asset model to long-term receivables upon
assets settlement.
Total liabilities increased by RMB82.5 billion year-on-year, mainly due to
Total liabilities 1,615,078,738 73.7 1,532,616,609 75.3 5.4 the increase in contract liabilities and long-term borrowings, both of which
accounted for 88.3% of the increase in total liabilities.
The decrease of RMB1.8 billion in notes payable for the year was mainly due to the
Notes payable 5,265,592 0.2 7,030,414 0.3 -25.1 reduction of note payments.
Contract liabilities increased by RMB27.7 billion, mainly due to the increase in pre-
Contract liabilities 309,479,052 14.1 281,789,584 13.9 9.8 sales property payments.
The net increase of long-term borrowings of RMB45.1 billion was mainly due to the
Long-term borrowings 292,897,038 13.4 247,800,428 12.2 18.2 continued growth of demand for long-term funds to support the capital operation of the
projects as the business grows and PPP projects are continuously launched.
The decrease in bonds payable of RMB10.8 billion was mainly due to the repayment of
Bonds payable 88,782,471 4.0 99,596,598 4.9 -10.9 some bonds by the Company.
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION

Other explanation

None
35

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

2.  Restriction on major assets as of the end of the Reporting Period

 Applicable  √ N/A

3.  Other explanation

 Applicable  √ N/A

(VI) Analysis of operating information in the industry

√ Applicable   N/A

Analysis of operating information in the construction industry

1.  Projects completed and accepted after verification during the Reporting Period

√ Applicable   N/A

Unit: 100 million yuan  Currency: RMB

Construction
Segment of Housing Infrastructure Specialized
and Others Total
industry construction construction engineering
decoration
Number of projects 7,677 1,661 / / / 9,338
Total amount 20,740 5,907 / / / 26,647

√ Applicable   N/A

Unit: 100 million yuan  Currency: RMB

Locations of projects Number of projects Total amount

Mainland China 9,031 24,791
Overseas 307 1,856
Of which:
Hong Kong and Macao SARs 96 850
Southeast Asia 98 377
Middle East 28 251
North Africa 9 62
Central and Southern Africa 19 16
America 27 134
Europe 5 0.1
Other regions 25 166
Total 9,338 26,647

Other explanation

√ Applicable   N/A

With reference to the relevant national standards, combined with its own operating characteristics and
structural development needs, the Company’s housing construction projects include engineering general
contracting and specialized contracting projects (foundation, steel structure, construction and installation,
renovation and decoration, etc.); infrastructure projects include transportation engineering (roads, municipal
roads, railways, urban rail transit, airports, ports and docks, parking lots, tunnels, bridges, waterways, etc.),
energy engineering, petrochemical engineering, water supply and treatment engineering, environmental

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

protection engineering, post and telecommunications engineering, health crisis and disaster prevention
engineering, hydraulic engineering and other projects (outdoor stadiums, outdoor recreational facilities,
reclamation, artificial islands, underground comprehensive pipe corridors, pipe networks, etc.), which is also
applicable to the items below.

2.  Projects under construction during the Reporting Period

√ Applicable   N/A

Unit: 100 million yuan  Currency: RMB

Construction
Segment of Housing Infrastructure Specialized
and Others Total
industry construction construction engineering
decoration
Number of projects 11,932 2,811 / / / 14,743
Total amount 57,252 19,118 / / / 76,370

√ Applicable   N/A

Unit: 100 million yuan  Currency: RMB

Locations of projects Number of projects Total amount
Mainland China 14,077 70,918
Overseas 666 5,452
Of which:
Hong Kong and Macao SARs 93 1,153
Southeast Asia 173 1,574
Middle East 62 560
North Africa 66 614
Central and Southern Africa 121 528
America 65 369
Europe 13 23
Other regions 73 631
Total 14,743 76,370

Other explanation

 Applicable  √ N/A

3.  Material projects under construction

 Applicable  √ N/A

Other explanation

 Applicable  √ N/A

4. Overseas projects during the Reporting Period

√ Applicable   N/A

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million yuan  Currency: RMB

Locations of projects Number of projects Total amount
Hong Kong and Macao SARs 189 2,003
Southeast Asia 280 2,004
Middle East 90 811
North Africa 80 703
Central and Southern Africa 144 721
America 92 502
Europe 18 23
Other regions 99 878
Total 992 7,645

Other explanation

√ Applicable   N/A

The above project status includes completed and settled, completed and unsettled, under construction and
others.

The amount of overseas projects set out in the contract was translated in the exchange rate of foreign
currencies against RMB as agreed in the contract or the spot exchange rate at the time of entering of the
contract.

5. Total number of new projects signed during the Reporting Period

√ Applicable   N/A

The total number of new projects signed during the Reporting Period was 5,718 with an amount of RMB2,772.1
billion (amount of construction contracts).

6. Orders in hand as of the end of the Reporting Period

√ Applicable   N/A

The total amount of orders in hand as of the end of the Reporting Period was RMB5,569.8 billion. Among them,
the amount of the contract has been signed but the project has not yet started is RMB1,724.4 billion, and the
amount of the unfinished part of the project under construction is RMB3,845.4 billion.

Other explanation

 Applicable  √ N/A

7. Other explanation

 Applicable  √ N/A

• The Company’s qualifications in the construction industry

As of the end of the Reporting Period, the Company had a total of 38 enterprises with special qualifications, 1 enterprise
with comprehensive engineering grade-A qualification, and 64 special-grade qualifications, including 32 special-grade
qualifications in general contracting of construction projects, 19 special-grade qualifications in general contracting of
municipal utilities works, and 10 special-grade qualifications in general contracting of highway projects, 2 special-grade
qualifications in general contracting of petrochemical projects, 1 special-grade qualification in general contracting of port
and waterway projects, and 1 grade-A qualification in design-related comprehensive business.

• The Company’s quality control system, implementation standards, control measures and
overall evaluation
Based on the ISO9001 quality system, the Company continuously improved the multi-level and comprehensive quality
management system such as quality organization system, regimes and supervision system, and maintained effective
operation. Before the commencement of work, the Company attentively made project quality planning, specified the
objectives of project quality management, entered into the agreement regarding the post quality responsibility goals,
refined the post quality tasks, and made preparations for construction. During the process of construction, the Company
implemented quality standardization management and guidance for examples, refined technical communication, adopted
strict approaches to engineering technology review, strict raw material field acceptance, management of inspection, and
inspection on process quality, taking a strict approach to project quality acceptance. After the completion of the project,

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

the Company signed project quality warranty, compiled the construction manual, and distributed it to the users. The
Company attached great importance to quality assurance services, established customer files, and conducted regular and
irregular quality review visits.

• Operation of the Company’s safe production system

In 2020, the Company had no major or above-grade production safety accidents. 169 projects of the Company were
awarded the “Projects for Study and Exchange on Safety and Production Standardization of Construction Project Sites” by
the Construction Safety and Machinery Branch of China Construction Industry Association (中国建筑业协会建筑安全与机械
分会), accounting for 32.2% of the total number of awards, ranking first among central enterprises and enterprises across
the country. Throughout the year, the Company identified and eliminated 1.03 million hidden hazards, carried out 365,000
safety production training sessions, and provided about 75,000 occupational health training sessions. 100% of employees
attended the training on safety and 100% employees had personal health files.
During the Reporting Period, the Company organized special meetings on production safety, meetings of the safety
committees, emergency video meetings on safe production, etc. to promote and implement General Secretary Xi Jinping’s
important expositions and instructions on production safety, and to implement the safe production and initiatives of the
Party Central Committee and the State Council. In response to the requirements for pandemic prevention and control
measures as well as resumption of work and production and based on the characteristics of the highly frequent occurrence
of accidents, the Company issued “Eight Prohibitions” for Enhancing Safety Precautious Measures during Pandemic
Prevention and Control and Resumption of Work and Production; in response to the severity of the high incidence of
accidents involving lifting injuries and limited-space operations across the country, the Company issued the Notice on
Strengthening the Safety Management of Lifting Machinery and Equipment and the Notice on Strengthening the Safety
Management of Limited-space Operation; to carry out the safety initiatives at the end of the year, the Company also issued
the Notice on Further Strengthening of Production Safety at the Turn of the Year and other documents. Enterprises at all
levels spared no efforts to ensure the pandemic prevention and control measures and safety and stability of resumption
of work and production, fully implemented the “special action on accountability of production safety and systematic
governance”. The Company also promoted the three-year action of special rectification measure of production safety, and
continued to carry out special inspections on production safety. The Company delivered satisfactory performance in three
battles, i.e., “battle for overcoming difficulties in pandemic prevention and control and resumption of work and production,
battle for promoting production safety in daily operating activities, and the battle for safeguarding safety and stability at the
turn of the year”, ensuring the safety and development of CSCEC.

(VII) Analysis of investment

1. General analysis of external equity investment

√ Applicable   N/A
The Company’s external equity investment mainly includes stocks purchased from the secondary market
for trading purposes, and equities held in other listed or unlisted companies for non-trading purposes.
Accounting items include financial assets held for trading, investment in other equity instruments and long-
term equity investments.

(1)  Major equity investment

 Applicable  √ N/A
(2)  Major non-equity investment
 Applicable  √ N/A
(3)  Financial assets measured at fair value
√ Applicable   N/A

Unit: ’000 yuan   Currency: RMB

Investment Changes in Cost of Gains or Changes in
Carrying value
cost at the investment investment at losses during fair value in Source of
Stock code Stock name at the end of Accounting items
beginning of cost during the the end of the the Reporting the Reporting stocks
the period
the period period period Period Period
Financial assets
600015.SH HUAXIA BANK 5,558 0 5,558 8,340 -1,563 -1,895 Purchase
held for trading
Financial assets
600723.SH BCRG 4,406 -4,406 0 0 2,781 2,169 Purchase
held for trading
Financial assets
/ SPH 1,961 -92 1,869 474 305 -446 Purchase
held for trading
Financial assets
/ PACIFICCENTURY 9,938 -466 9,472 1,941 0 0 Purchase
held for trading
Financial assets
/ PACIFIC2 CENTURY2 1,472 -69 1,403 789 0 0 Purchase
held for trading

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 SECTION IV  DISCUSSION AND ANALYSIS OF BUSINESS OPERATION
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Investment Changes in Cost of Gains or Changes in

Carrying value
cost at the investment investment at losses during fair value in Source of
Stock code Stock name at the end of Accounting items
beginning of cost during the the end of the the Reporting the Reporting stocks
the period
the period period period Period Period
CHENGDU HI-TECH Financial assets
000628.SZ 440 0 440 2,636 -443 -443 Purchase
DEVELOPMENT CO LTD. held for trading
Financial assets
601328.SH BANKCOMM 2,660 0 2,660 11,296 -2,105 -2,900 Purchase
held for trading
Financial assets
601838.SH BANK OF CHENGDU 255 0 255 4,123 781 618 Purchase
held for trading
Financial assets
600688.SH SPC 601 -601 0 0 243 -9 Purchase
held for trading
Financial assets
600620.SH SHSTC 16 -16 0 0 65 -9 Purchase
held for trading
Investment in
AGRICULTURAL BANK OF
601288.SH 796,467 0 796,467 933,173 54,058 -163,454 other equity Purchase
CHINA instruments
Investment in
600015.SH HUAXIA BANK 241,479 0 241,479 362,316 14,434 -82,318 other equity Purchase
instruments
Investment in
601328.SH BANKCOMM 2,005 0 2,005 6,423 452 -1,389 other equity Purchase
instruments
Investment in
00687.HK TYSAN HOLDINGS 199,904 0 199,904 18,470 39,350 -32,590 other equity Purchase
instruments
Investment in
600778.SH YOUHAO GROUP 720 -720 0 0 0 -1,950 other equity Purchase
instruments
Investment in
601229.SH BANK OF SHANGHAI 1,641 0 1,641 9,457 483 -1,990 other equity Purchase
instruments
Other current
000617.SZ CNPCCCL 1,900,000 0 1,900,000 1,668,344 45,523 -204,263 Purchase
assets
Other current
600390.SH MINMETALS CAPITAL 1,500,000 0 1,500,000 1,237,833 14,010 -447,065 Purchase
assets
Financial assets
Other investment in securities 896,034 -648,588 247,446 214,860 12,202 -6,516 Purchase
held for trading
Total 5,565,557 -654,958 4,910,599 4,480,475 180,576 -944,450 / /
Notes:
① This table sets out the Company’s investment in stock securities including as financial assets held for trading, other current
assets, and investment in other equity instruments.
② Profit and loss for the Reporting Period, with respect to financial assets held for trading, includes the investment income and
changes in fair value during holding period and the investment gains on disposal during the Reporting Period; with respect
to investment in other equity instruments and other current assets, includes investment gains during the holding period.
③ Other securities investment refers to investment in stock securities accounted for as financial assets held for trading,
investment in other equity instruments other than those listed above.
④ In addition to the table above, for other items included in financial assets held for trading and investment in other equity
instruments, please refer to the relevant information as set out in Note V 2 “Financial assets held for trading” and Note V 15
“Investment in other equity instruments” under Section XI “FINANCIAL REPORT” hereof.

(VIII) Major disposal of assets and equity interests

 Applicable  √ N/A

(IX) Analysis of major controlling companies or companies with shareholding

√ Applicable   N/A

1. Major subsidiaries acquired through incorporation or investment

Unit: ’000 yuan  Currency: RMB
Shareholding ratio
Name Nature of business Registered capital Total assets Net assets Net profit
(%)
COHL Investment holding 31,032,258 100.00 921,633,116 296,568,256 43,252,283
China Overseas Land & Investment Real estate development and operation HKD1,095,000,000 56.00 756,032,365 275,517,623 36,880,626
CSC International Construction and installation HKD1,500,000,000 64.66 153,473,783 45,615,157 5,131,456
China Overseas Property Property management HKD30,000,000 61.18 5,213,183 1,838,312 614,342
China Construction First Group Corporation Construction and installation 7,000,000 100.00 94,406,571 24,274,709 2,804,773
China Construction Second Engineering Division Construction and installation 5,000,000 100.00 123,853,978 31,992,387 2,278,857

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Shareholding ratio
Name Nature of business Registered capital Total assets Net assets Net profit
(%)
China Construction Third Engineering Division Construction and installation 5,039,865 100.00 224,235,936 56,381,608 7,661,202
China Construction Fourth Engineering Division Construction and installation 5,100,000 100.00 108,240,036 21,703,151 724,699
China Construction Fifth Engineering Division Construction and installation 6,018,000 100.00 147,347,571 30,393,665 3,408,287
China Construction Sixth Engineering Division Construction and installation 4,277,946 100.00 59,275,536 12,026,530 376,400
China Construction Seventh Engineering Division Construction and installation 6,000,000 100.00 89,843,970 22,853,392 2,052,689
China Construction Eighth Engineering Division Construction and installation 13,500,000 100.00 224,271,026 52,616,573 8,521,384
China Construction Engineering Design Group Engineering prospecting and design 510,000 100.00 2,940,984 1,118,377 86,279
China State Decoration Industrial renovation and decoration 1,000,000 100.00 13,958,594 2,759,039 19,713
China Construction Fangcheng Business of infrastructure construction 5,000,000 100.00 62,840,499 17,010,347 1,575,336

2. Major subsidiaries acquired through business combination under common control

Unit: ’000 yuan  Currency: RMB

Registered Shareholding
Name Nature of business Total assets Net assets Net profit
capital ratio (%)
CSCEC Xinjiang
Construction and installation 3,500,000 85.00 46,260,376 13,164,802 1,294,023
Construction & Engineering
China West Construction Construction materials 1,262,354 57.79 23,833,616 10,056,435 945,990
Shenzhen China Overseas Real estate development
Investment（深圳中海投资）
2,650,000 100.00 3,495,304 3,460,950 176,720
and operation
CSC Finance Financial 10,000,000 80.00 111,756,847 12,415,401 602,877

3. Major subsidiaries acquired through business combination not under common control
Unit: ’000 yuan  Currency: RMB

Registered Shareholding
Name Nature of business Total assets Net assets Net profit
capital ratio (%)
Construction and
CSC Development HKD100,000,000 47.89 6,218,497 1,324,877 158,850
installation
China Construction
Infrastructure
Harbour and Channel 1,333,333 70.00 9,093,644 2,092,743 137,658
construction
Engineering Bureau

For details, please refer to relevant information as set out in “1. Interests in subsidiaries” under Note VII
“Interest in other entities” to the financial statements under Section XI “FINANCIAL REPORT” hereof.

(X) Structured entities under the control of the Company

√ Applicable   N/A

For details, please refer to relevant information as set out in “3. Interests in consolidated structured entities” under
Note VII “Interest in other entities” to the financial statements under Section XI “FINANCIAL REPORT” hereof.

III. Discussion and Analysis of the Future Development of the Company

(I) Industrial development and trends

√ Applicable   N/A

For details, please refer to relevant information as set out in Section III “OVERVIEW OF BUSINESS OPERATION”
hereof on the situations of the industry.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(II) Development strategies

√ Applicable   N/A
In 2021, the Company will continue to be committed to the corporate mission of “expanding a happy living
environment”, uphold the guiding philosophy of inheritance and innovation, adhere to the general principle of
the work of making progress while maintaining stability, building on the new development stage, implement
new development concepts, and serve to create a new development pattern, enhance professional capabilities
throughout the life cycle in the fields of construction, investment, prospecting and design, strengthen normalized
pandemic prevention and control, make dedicated efforts in production and operation, promote high-quality
development, and make a good start for the “14th Five-Year Plan”.
During the “14th Five-Year Plan” period, the Company will continue to highlight the main responsibilities and main
business in accordance with the principle of respecting history and embracing the future, and firmly promote the
Company’s continuous high-quality development, innovative development, eco-friendly development, business
optimization development, digital development and overall security development and transformation, and
expand emerging business areas closely related to the main business. The Company will strive to speed up its
transformation and upgrading while securing growth, follow the principle of innovation and inheritance, and further
enhance its core competitiveness.
1. Investment and operation business. The real estate business is committed to becoming an exceptional
international real estate development and operation group, and will continue to take “transformation and
upgrading” as the keynote, accelerate the formation of a pattern that focuses on residential product
development, supplemented by high-quality commercial development and operation as well as by
emerging business such as education and healthcare. Infrastructure investment and operation business is
a key part for the Company to optimize its business structure and achieve transformation and upgrading.
During the “14th Five-Year Plan” period, the Company will attach great importance to investment
management and the safe and stable operation of projects, and strive to enhance “three key aspects
of capabilities”, i.e., operation control, professional implementation and risk resolution. With regard to
new-type urbanization business, the Company will proactively seize opportunities, actively implement
the country’s strategic deployment of the implementation of urban renewal actions, coordinate regional
distribution, concentrate relevant resources, give full play to its “four-in-one” advantage, and focus on
the zoning development and large-scale urban renewal, station-city integration, urban operation, etc.,
coordinate urban planning, construction, and operation management to create a livable, green, resilient,
smart and humane city, and continuously improve the quality of urban living environment and people’s life,
dedicated to becoming a leading urban service operator in the country.
2. Engineering construction business. The housing construction engineering business should continue to
consolidate the Company’s absolute dominant position in the housing construction field. In accordance
with the principle of steady development with efficiency enhancement, the business will focus on
expanding projects in the public investment and high-quality real estate developers’ residential and
commercial office projects, and continue to improve its competitiveness in super high-rise and large-span
projects, reach industry benchmark levels in supply chain management, informatization, construction
quality, energy conservation and environmental protection as well as production safety, and deliver
scientific research results reaching the domestic and international leading levels, and continuously improve
the Company’s market competitiveness and quality of development. Infrastructure business is still an
important aspect of the Company’s optimization of its business structure. It is necessary to more actively
seize the development opportunities brought by the country’s major strategies, focus on key markets,
improve its management system, and strive to make up for the shortcomings by combining provinces and
metropolitan areas, thus obtaining the dual benefits of economic growth and social responsibility, and
promoting the further optimization of the Company’s business structure, and ensuring that the infrastructure
business continues to grow stronger, better, and bigger during the “14th Five-Year Plan” period. In terms of
business in construction, the Company continues to deepen reforms and innovations, optimize the internal
coordination mechanism of the system, and continue to grow stronger, better and larger, and become the
industry’s leading enterprise in terms of scale, technology and quality, as well as the first choice for high-
end customers.
3. Prospecting and design business. Through the prospecting and design business, the Company will
enhance its brand influence, cultivate high-end talents, strengthen technological innovation, and provide
strong support for the Company’s general engineering contracting business. The Company will also
promote the extension of the prospecting and design business, build the core competence of the brand,
focus on key professional directions, achieve distinctive and differentiated development, enhance the
original ability of product solutions, strengthen brand building, create a highland of talents in prospecting
and design, and prepare high-end talent reserves, strengthen business synergy and linkage, and
innovate business cooperation models. Taking advantage of development opportunities such as the
BRI, the Company will actively cooperate with entities within and outside the system to expand overseas
prospecting and design business.
4. New business. The Company will further intensify the development of new business, and vigorously
create an innovative atmosphere within the Company that encourages bold explorations and innovation
and tolerates failure. The Company will implement classified policies, and give appropriate special
considerations in terms of resource input, performance appraisal and management procedures, give full
play to the Company’s advantages, continue to explore new business forms, cultivate new momentum, and
strive to make new business an important business segment of the Company by the end of the “14th Five-
Year Plan” period.
5. International business. During the “14th Five-Year Plan” period, in the face of the new situations of
severe and complex international environment and widespread and far-reaching impact of the pandemic,
the Company will continue to adhere to the development direction of developing global business,
further improve the international operation mechanism and model, and seize the business opportunities
brought by the BRI, enhance the voice and influence in the global industry, and become an outstanding
representative of “Chinese Construction” in the global market. Meanwhile, the Company will focus on
contributing international talents, and learn their advanced management experience and business
philosophy through competition with international advanced enterprises, with a view to improving the
Company’s overall management level.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

During the “14th Five-Year Plan” period, the Company will, based on the actual needs of the new
development stage, implement the new development concept, accelerate the construction of a new
development pattern, take the promotion of high-quality development as the theme, and deepen the
supply-side structural reform as the main line, paying attention to the new business opportunities brought
by demand-side reform, benchmark against the country’s “14th Five-Year Plan” and 2035 long-term
vision goals, proactively adapting to the new situation and meeting new challenges, fully seizing new
opportunities, nurturing opportunities in crises and changes. The Company will always bear in mind the
overall strategy of the great rejuvenation of the Chinese nation as well as the profound changes unseen
in the world in a century, thereby maintaining strategic focus and remaining committed to development,
amplify our own advantages, complement various shortcomings, and coordinate development and
safety, take full advantage of the domestic and international markets, and make good use of the domestic
and international resources, thus achieving higher quality, more efficient, more sustainable and safer
development, and becoming a “globally competitive world-class comprehensive enterprise group in
investment and construction”.

(III) Operation Plan

√ Applicable   N/A
In 2021, the Company plans to achieve the amount of newly signed contracts of more than RMB3.50 trillion,
and a revenue of more than RMB1.76 trillion. The Company will adhere to the general work guideline of making
progress while maintaining stability, adhere to the new development concept, pursue high-quality development,
focus on the strategic goal of “one creation and five aspects of strength”, implement the “166” strategic measures,
adhere to high-quality development, and strive to solve the issue of unbalanced and insufficient development, and
promote reform in terms of quality, efficiency and driving force. The Company will adhere to scientific research
and judgment, accurately respond to the external situation and national policies, take the initiative to study new
situations, solve new problems, and creatively promote the work throughout the year. The Company will also make
persistent efforts in the implementation of the Company’s reform and development tasks. We will focus on five
aspects of work:
1. Promoting the quality development of housing construction business. The Company will pay close
attention to the impact of the “three red lines” and bank real estate loan concentration management on the
industry, strictly implement the bottom line of the Company’s real estate projects, strengthen cooperation
with high-quality customers, and resolutely abandon projects that do not meet the bottom-line standards.
The Company will intensify the development of the public investment market, and further expand projects
in areas such as science and technology innovation projects, public health, and the renovation of old
urban communities, actively adapt to new changes in technology, capture new market demands, upgrade
products and services, and increase high-quality supply.
2. Promoting the scale development of infrastructure business. The Company will continue to adhere
to high standards, seize opportunities, integrate resources, and continue to strengthen and optimize
the infrastructure business. The Company will improve the infrastructure business system, enhance the
marketing system centered on two-level headquarters, the performance system centered on general
contracting capabilities, and the support system centered on technology, so as to continuously improve
the core competitiveness of the infrastructure business. The Company will deeply cultivate the national
strategic areas, further give play to the role of the Company’s leadership to contact the regional
mechanism, deepen the high-level connection, and implement major projects. It is necessary for the
Company to actively expand into key infrastructure markets, and strive to obtain major projects in the
fields of urban rail transit, municipal roads, expressways, ecological and environmental protection, water
conservancy and railways.
3. Promoting the steady development of real estate business. Adhering to the regulatory policy that
“houses are for living in, not speculation” and the principle of prudent and caution investment, the
Company will explore new strategies to adapt to the new situation, ensure the steady growth of scale and
profits, and achieve high-quality development. China Overseas will continue to consolidate and enhance
its advantages in residential development, accelerate the improvement of commercial asset scale and
operational efficiency, increase turnover speed, seek benefits from digitalization and refinement, and
maintain industry-leading profitability. CSC Land will focus on development business and on investment
areas, maintains an investment rhythm that matches resources and capabilities, and strives to improve
turnover efficiency and quality of development.
4. Promoting the innovative development of prospecting and design business. The Company will
vigorously enhance the originality ability, focus on the three major points of technological innovation,
talent training and introduction as well as professional construction, and promote more professional fields
to reach first-class levels. The Company will intensify transformation and upgrading efforts, deepen the
expansion of new areas such as land and space planning, urban design, and infrastructure prospecting
and design, cultivate new business growth points, and facilitate the Company’s structural adjustment. The
Company will promote the allocation of high-quality design resources to the core regional market, and
promote the optimization of the layout of design of the Yangtze River Economic Belt and the GBA.
5. Promoting the rapid development of innovative businesses. In terms of the financial business, the
Company adheres to the principle of integrating industry and finance and strengthening production by
financing, further improve the business layout, enhance service functions, strengthen risk prevention
and control, and effectively meet the needs of the main business. The Company will also accelerate the
cultivation of new infrastructure business, continue to explore projects in emerging fields such as smart
parking, smart light poles and general aviation, and create a sustainable business model.
6. Developing overseas markets through concrete efforts. Making innovations in perseverance, and
seeking development in innovation, the Company will overcome immediate difficulties, consolidate existing
achievements, and promote high-quality overseas development. The Company will streamline overseas
top-level design, increase market development efforts, formulate development plans in a scientific manner,
categorize and cultivate overseas markets, and strive to nurture new opportunities and open new chapters.
The Company will improve basic management capabilities, optimize coordinated management measures
for overseas markets, and continue to promote standardized management of overseas projects.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

The business plan does not constitute the commitment to investors in terms of the Company’s performance.
Investors are advised to maintain sufficient risk awareness, and should understand the difference between the
business plan and commitments of performance.

(IV) Potential risks

√ Applicable   N/A

1. Macro-economic risks
Currently, the country’s economic growth is shifting, the issue of the aging of the population is serious, the
economic growth continues to decline, and the overall development of the construction industry is slowing
down. Looking ahead, due to international trade frictions and changes in the international financial situation,
as well as the continued impact of the COVID-19 pandemic, although China’s economy will continue to
recover in 2021, we should not be over-optimistic. With the weakening of counter-cyclical adjustment
policies, infrastructure and real estate investment is facing the downward pressure. The Company
must continue to strengthen in-depth research on the macro economy, closely follow national and local
investment and construction hotspots, deepen supply-side structural reforms, accelerate business
transformation and upgrading, and promote radiation and extension of its business. The Company will
strengthen monitoring during the execution of strategic planning to target the external economy, revise
corporate strategy in time for environmental changes, actively integrate into national strategy, further
optimize regional layout, precise layout in key areas, give full play to its own professional advantages, and
actively seek business opportunities from national regional strategic layout. The Company will actively and
steadily explore overseas markets and seize the opportunities brought by BRI, promote the continuous
development and growth of overseas business, strengthen regional linkages, enhance synergies, give
play to the Company’s advantages in resource integration, and increase the Company’s sensitivity and
predictability to changes in the economic environment.

2. International operation risks

Since the fourth quarter of 2020, the pandemic in many countries has rebounded strongly, causing a
serious impact on the global society and economy. Affected by the idea of reverse globalization, strategic
games among major powers were intensified, and uncertainties and risks in the international situation have
increased. The continuous spread of the pandemic has led to a sharp decline in contracting projects in the
international market, and the pressure on market development has significantly increased. Projects under
construction have recorded an increase in pandemic prevention expenditures, experienced payment
delays, and lagging progress in contract performance. Project costs and construction schedule pressures
have also risen. In particular, the unstable security situation of individual countries has increased the
difficulty of operating in overseas markets. Confronting such complex and ever-changing international
situation, the Company has been consolidating its ability to identify and respond to international business
risks and strengthening the Company’s control and dynamic adjustment of organizational structure.
Besides, it has been improving the comprehensive risk management system of the entire business chain of
overseas business, adhering to compliant operations, and improving the risk assessment and monitoring
mechanism of overseas projects. It has also paid attention to the effective operation of overseas safe
production supervision mechanisms, and properly identified, prevented and resolved risks of international
operations.

3. Risks related to safety, environmental protection and quality

The Company’s engineering contracting business accounts for a large proportion of its business
portfolio and covers a wide range of sectors. Due to the characteristics of the industry and the external
environment, in the course of construction, it may be exposed to natural disasters such as floods,
rainstorms, earthquakes, typhoons, and fires and risks such as unexpected public events. The Company’s
production safety, environmental protection and quality are exposed to certain risks. The Company takes
production safety, environmental protection and quality as the lifeline of the Company and attaches great
importance to project management. Over the years, the Company has been adhering to the concept of “life
first, safety operation foremost”, always putting project management in the first place, and strictly following
the CSCEC 1132 safe production supervision model to improve the safety supervision system of all levels
of enterprises to the production unit. The Company will further improve the safety production supervision
organization in accordance with the law, fully allocate full-time safety supervision personnel, strengthen the
quality and capacity of the safety supervision team, adhere to the problem-oriented approach, defend the
bottom line of safety, innovate management methods, consolidate the safety foundation, and effectively
prevent all kinds of production safety accidents. The Company closely follows the national environmental
protection policy guidance, continues to increase the promotion of environmental protection management,
initiates the preparation of the CSCEC Ecological Environmental Protection Management Measures and the
Management Manual, and promotes enterprises at all levels to improve safety, ecology and environmental
protection as well as quality management system in terms of enterprises and projects, continue to
consolidate the foundation of project management and improve risk prevention capabilities.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

4. Risks related to the COVID-19 pandemic

CSCEC is a labor-intensive enterprise. Project suspension and personnel isolation caused by the pandemic
will have certain impact on the production and operation of the Company, and will exert greater pressure
on the Company’s main economic indicators. In response to the global pandemic and the current situation
of the COVID-19 pandemic, the Company made effective efforts in normalized pandemic prevention and
control to ensure the lives and health of employees of the Company, while dealings with new risks brought
by the global pandemic, such as the resulting risks of resumption of work and production due to the
restriction on materials and personnel, decline in business performance due to the impact of the pandemic,
legal contract disputes and other derivative risks. Throughout the year, the Company strengthened the
overall planning and organizational leadership of pandemic prevention and control, resumption of work
and production, and urged all subsidiaries and projects to establish a work system featuring “horizontal
to edge, vertical to end”, and defined work responsibilities at all levels. It also strictly implemented
the pandemic prevention and control reporting mechanism, and implemented dynamic tracking and
monitoring. Under the premise of preventing and controlling the pandemic, the Company actively resumed
work and production, thoroughly analyzed the impact of the pandemic on production and operation,
formulated targeted policies and measures, and strengthened work deployment. At present, with the
normalized management of the pandemic, the Company has not relaxed its vigilance, and adhered to the
overall coordination of domestic and foreign countries, strictly implements the main responsibilities, and
continues to make concrete efforts in pandemic prevention.

5. Investment risk
The 2021 Economic Work Conference of the Political Bureau of the Central Committee proposed “promoting
the stable and healthy development of the real estate market”, laying the main tone for the “stable” and
“development” of the real estate industry in 2021. The central government’s determination to balance
steady growth and prevent risks remains unchanged. The overall policy orientation of the real estate
regulation and control policy has remained stable. The strong positioning of regulatory policy that “houses
are for living in, not speculation” is maintained, and city-specific policies have been implemented to
ensure the smooth operation of the market. Affected by the domestic economic downturn, fiscal pressure
and the pandemic, under the “three stabilities” target, there are no obvious signs of relaxation in the
short-term restrictions on purchase, loan and sales. The financial supervision for the industry continues
to be strengthened, and some investment projects may not be able to progress as planned. These may
result in an increase in the risk of investment recovery, increased corporate financing costs and reduced
investment returns. The Company will strengthen research on national policies, regulations and industry
policies. Under the combined effect of PPP project clean-up regulations and strict financial supervision
policies, the Company will strictly implement the requirements as stipulated in No. 192 document of
SASAC, No. 92 document of the Ministry of Finance and No. 10 document of the Ministry of Finance,
improve investment business management and control standards and reasonably control the scale of
investment. The Company will also strictly implement the investment budget, insist on the principle of “no
investment without budget”, and strictly require that subsidiaries without budget space shall not invest in
new projects. The Company will adhere to the principle of operating within capacity, and establish a “dual
control” mechanism for investment budgets and asset-liability ratios. The Company will strictly regulate the
expansion of PPP projects, strictly implement investment business control requirements, further clarify the
legal compliance requirements of PPP projects, carry out project feasibility research, prevent decision-
making risks with scientific advance planning and demonstration, and take a “zero tolerance” approach
in terms of risks in compliance defects of projects, with a view to effectively improving the quality of new
investment projects. At the same time, the Company will strengthen the process management and control
of investment projects, comprehensively improve project operation capabilities, and promptly give warning
on and mitigate risks that may arise during the implementation of investment projects.
Various financial risks faced by the Company in its operating activities include market risks (mainly
exchange rate risk, interest rate risk and other price risks), credit risk and liquidity risk. The overall risk
management plan of the Company will focus on the unpredictability of the financial market, and reducing
the potential adverse impact on the financial performance. For details, please refer to the relevant
information as set out in Note VIII “Risks relating to financial instruments” to the financial statements under
Section XI “FINANCIAL REPORT” hereof.
For details of the Company’s goodwill and its impairment, please refer to the relevant information as set out
in Note V. 20 “Goodwill” to the financial statements under Section XI “FINANCIAL REPORT” hereof.

(V) Miscellaneous
 Applicable  √ N/A

IV. Explanation on the Circumstances and Reasons for not Disclosing in Accordance with
the Standards due to Non-applicability of the Standards or Special Reasons such as State
Secrets and Trade Secrets
 Applicable  √ N/A

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 SECTION V  IMPORTANT MATTERS
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

SECTION V  IMPORTANT MATTERS

I. Profit Distribution Plan of Ordinary Shares and Reserve Capitalization Plan

(I) Formulation, execution, or adjustment of cash dividend policy

√ Applicable   N/A
According to the Articles of Association: The Company may distribute dividends in cash, stock, a combination of
both and other means permitted by laws and regulations; the Company shall preferentially make profit distribution
in the form of cash dividends. In the event that the Company is operating well and the Board of Directors believes
that the Company’s share price does not match the size of its share capital, and the distribution of dividends in
stock is in the interests of shareholders of the Company as a whole, the Company may propose stock dividend and
other distribution proposals when the conditions for distribution in the form of cash dividends are satisfied. Except
for special circumstances as determined by the Board of Directors of the Company, the Company shall distribute
dividends in cash when the Company records a profit in current year and the accumulated undistributed profits are
positive. The profits distributed in cash each year shall, in principle, be not less than 15% of the distributable profits
of that year.
On May 25, 2020, the Proposal on 2019 Profit Distribution Plan of China State Construction Engineering
Corporation Limited was considered and approved at the 2019 annual general meeting of the Company
through a combination of on-site open ballot and internet voting; on June 17, 2020, the Company released the
Announcement on Implementing Rights and Interests Distribution for 2019 of China State Construction Engineering
Corporation Limited; on June 24, 2020, the Company distributed cash dividends to all shareholders, marking the
full implementation of the profit distribution plan in 2019. The Company distributed profits in strict compliance with
relevant provisions of the Articles of Association and the resolutions passed at the general meetings.

(II) Plans or proposals for profit distribution or reserve capitalization of the Company in the last
three years (including the Reporting Period)
Unit: ’000  Currency: RMB

Net profit
attributable Percentage
to ordinary of the net profit
Amount of shareholders attributable
Number of
Number of dividends of the listed to ordinary
Year of shares Amount of
bonus shares distributed company in the shareholders
dividend transferred cash dividends
per 10 shares per 10 shares consolidated of the listed
distribution per 10 shares (tax inclusive)
(shares) (RMB) financial company in the
(shares)
(tax inclusive) statements consolidated
for the year financial
of dividend statements (%)
distribution
2020 0 2.147 0 9,006,272 44,944,250 20.04
2019 0 1.85 0 7,763,538 41,881,399 18.53
2018 0 1.68 0 7,052,853 38,241,324 18.44
The Company realized a net profit of RMB23.8 billion during the Reporting Period. After allocating 10% of the net
profit for statutory reserve in an amount of RMB2.4 billion, and setting aside RMB400 million for paying interest
on perpetual bonds, and adding RMB11.9 billion carried forward to 2020 after the profit distribution for 2019 and
other comprehensive income carried to undistributed profit of RMB400 million, the profit available for distribution to
ordinary shareholders for 2020 was RMB33.3 billion, and the capital surplus of the Company was RMB29.0 billion.
In accordance with relevant provisions of the Company Law and the Articles of Association, the profit distribution
plan for 2020 has been formulated on the basis of the Profit Distribution Plan of China State Construction
Engineering Corporation Limited for 2020 as considered and approved at the 53rd meeting of the second session
of the Board of Directors of the Company by taking into account shareholder returns, the Company’s capital
demand for business development and other factors.
The profit distribution will be made in the form of cash dividends. A total of RMB9.0 billion of cash dividend will be
distributed to all ordinary shareholders at RMB2.147 (tax inclusive) per 10 shares based on the 41,948,167,844
shares of the Company as of the date of disclosure. In case of any change in the total share capital of the
Company prior to the record date of shareholders for profit distribution, the Company proposes to maintain the
distribution ratio per share unchanged, and to adjust the total distribution amount accordingly. An announcement
containing details of the adjustments will be made separately.
The remaining RMB24.3 billion after the distribution of cash dividends will be carried forward to the undistributed
profits.
The independent directors of the Company have expressed opinions on this plan, which is still subject to
the approval by the 2020 annual general meeting of the Company. A combination of on-site open ballot and
internet voting will be adopted at the 2020 annual general meeting of the Company so as to ensure that minority
shareholders have adequate opportunities to express their opinions and appeals, thereby fully safeguarding their
legal interests.

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 SECTION V  IMPORTANT MATTERS
47
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Explanation on the cash dividend to be distributed by the Company for the current year is as follows:

1. Industry where the Company operates and its characteristics

The construction industry in which the Company is involved is a fully competitive industry, featured by
fierce market competition and generally low gross profit margin. Fields such as new infrastructure and new
energy will become the new direction of the industry’s development. From the perspective of the “14th
Five-Year Plan”, a series of major national strategies will form new growth opportunities in the construction
sector and bring new development impetus to the construction industry.

2. Development stage of the Company and its own business model

In 2020, the Company hit a new record high in terms of the value of new contracts and revenue, bringing
with it stronger global competitiveness and brand influence. Under the new development pattern featuring
domestic big cycle and supplemented by domestic and international twin cycles, the Company actively
incorporated itself into the major national strategies and made concrete efforts to carry out the BRI, and
seized the opportunities in overseas markets with a view to building a world leading enterprise group with
global competitiveness.

3. Profitability and capital needs of the Company

Since the listing of CSCEC, the return on net assets has remained at a high level of approximately
15%, delivering stable investment returns to its shareholders. As the Company increases its reform and
innovation efforts, it needs to increase its investment in innovative businesses and new technologies. In
addition, in order to meet the needs of daily operation and the smooth progress of projects, the Company
needs to maintain a certain amount of retained earnings.

4. Why the Company keeps part of the undistributed profit

Currently, the downward pressure on the world economy is increasing, and the international situations
are changing rapidly. To enhance its resilience against risks, objectively, the Company needs to keep a
certain amount of retained earnings. The retained earnings accumulated by the Company over the years
are attributable to all investors. With quicker transformation from high-speed development to high-quality
development, the profitability of the Company will be improved gradually, thus enabling the Company to
offer better returns to investors in the future.

5. Purpose of the undistributed profit retained by the Company and its estimated income
The retained undistributed profit will be used to support the Company in capturing strategic development
opportunities and to deepen the Company’s strategy, increase structural adjustment and transformation
and upgrading, and to seek new profit growth points. CSCEC has maintained a stable cash dividend policy
for years, demonstrating the ability of CSCEC to maintain stable development and sustained dividend
distribution. In 2021, the Company will strive to improve its value-creation capacity under the development
goals of “one creation and five aspects of strength” and reward shareholders with excellent operating
results.
This profit distribution plan complies with the provisions of relevant laws, regulations and the Articles of
Association with compliant and transparent profit distribution procedures. CSCEC has maintained a stable
cash dividend policy with an increase in the cash dividend to be distributed per share for the current year
over last year. Upon completion of dividend distribution for the current year, the accumulative dividends
distributed in the last three years will amount to RMB23.8 billion, representing 57.15% of the annual
average distributable profit realized in the last three years. This demonstrates the ability of CSCEC to
maintain stable development and sustained dividend distribution, as well as its determination to reward
shareholders with excellent operating results.

(III) Inclusion of shares repurchased by way of cash into cash dividend

 Applicable  √ N/A
In addition to the above dividend plan, the Company has repurchased a total of 912,036,000 shares through
centralized bidding trading in 2020, and the total repurchase amount paid was RMB4,792,282,012.54 (excluding
transaction fees such as stamp duty and transaction commissions), accounting for approximately 10.66% of net
profit attributable to ordinary shareholders of the Company as presented in the consolidated financial statements of
the Company.

(IV) If the Company records a profit during the Reporting Period and the profit distributable to the
ordinary shareholders of the parent is positive but there is no proposal for distribution in the
form of cash dividends, the Company shall disclose in detail the reasons therefor, and the
purpose and usage plan of the undistributed profits
 Applicable  √ N/A

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 48
II. Fulfillment of Commitments

(I) Commitments of the Company’s de facto controller, shareholders, related parties, acquirer, the Company, and other related parties
during or subsisted in the Reporting Period

BAR21010002_E_CSCEC 2020AR()_.indb 48
√ Applicable   N/A
Time limit for Strict and timely Alternative plan Alternative plan
Time and term of
Background of commitment Type of commitment Commitment party Content of commitment performance or performance or if failed to fulfill if failed to fulfill
commitment
not not commitment commitment
The Agreement on Avoidance of Horizontal Competition with the Company
was signed. Please refer to relevant contents of the Prospectus in Relation
To resolve horizontal China State In the process of
to the Initial Public Offering of Shares by China State Construction No term No Yes N/A
competition Construction performance
Engineering Corporation Limited published by the Company on July 13,
2009.
SECTION V  IMPORTANT MATTERS

For the land use rights and properties injected as contributions into the
To resolve defects Company and included in the scope of assets valuation report, at request
Commitments in relation to initial China State In the process of
in land and other of and with the cooperation from the Company, relevant procedures for No term No Yes N/A
  public offering Construction performance
property ownership registration of the said land use rights and properties under the existing
name of the Company or its relevant subsidiaries shall be completed.

For the real property projects injected as contributions into the Company,
To resolve defects
China State whose revenue had been recognized before the establishment of the In the process of
in land and other No term No Yes N/A
Construction Company, the land value-added tax, subject to supplementary payment in performance
property ownership
future final settlement thereof, shall be borne by China State Construction.

Issued a non-competition commitment, with the same content as those

set out in the Entrusted Management Agreement, to China Overseas
Land & Investment, a holding subsidiary listed in Hong Kong. Please
To resolve horizontal During the In the process of
CSCEC refer to relevant content of Announcement on the Signing of Entrusted Yes Yes N/A
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

competition commitment term performance

Management Agreement between CSCEC and Its Holding Subsidiary
China Overseas Land & Investment published by the Company on
February 11, 2014.
Issued a non-competition deed to China Overseas Property, a holding
subsidiary listed in Hong Kong, and please refer to relevant content of the
Other commitments made to
To resolve horizontal Listing Documents – Listing by Way of Introduction of the Entire Issued During the In the process of
  minority shareholders of the CSCEC Yes Yes N/A
competition Share Capital of the Company on the Main Board of The Stock Exchange commitment term performance
 Company
of Hong Kong Limited published by China Overseas Property on October
14, 2015.
Undertook to fulfill his/her duties diligently during his/her term of office as
Members of senior a member of senior management of the Company, properly handle the
management who relationship between the Company and its controlling shareholder, live up
During the In the process of
Others also hold positions to the trust of the Board of Directors and all shareholders of the Company, Yes Yes N/A
commitment term performance
in China State defend the interests of the Company and shareholders, and not to do
Construction anything that may jeopardize the interests of the Company and its minority
shareholders due to serving the two entities concurrently.

2021/5/21 13:19:44
 SECTION V  IMPORTANT MATTERS
49
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(II) Where the Company has profit forecasts on assets or projects, and the Reporting Period is
within the term of profit forecasts, the Company has to state whether such profit forecasts on
assets or projects are fulfilled and the reasons therefor
 Fulfilled   Not Fulfilled  √ N/A

(III) Completion of performance commitment and its effect on goodwill impairment test
 Applicable  √ N/A

III. Occupation of Funds and Progress of Repayment during the Reporting Period

 Applicable  √ N/A

IV. Company’s Explanation on the “Audit Report with Modified Opinion” of the Accounting Firm

 Applicable  √ N/A

V. The Company’s Analysis of and Explanation on the Causes and Impacts of Changes in
Accounting Policies and Estimates or Corrections of Material Accounting Errors

(I) The Company’s analysis of and explanation on the causes and impacts of changes in
accounting policies and estimates
√ Applicable   N/A

According to the Question and Answer on the implementation of enterprise accounting standards issued by the
Ministry of Finance in December 2020, the Company reclassified the impairment loss of contract assets originally
included in the “credit impairment losses” in the income statement to “asset impairment losses”. The change in
accounting policy has no impact on the net profit and the equity both on the consolidated and the company levels.

According to Accounting Standard for Business Enterprises No. 13, from January 1, 2020, the following parties
that were not regarded as related parties previously are regarded as related parties: Joint ventures and their
subsidiaries or associates and their subsidiaries of other member units of the Company’s corporate group (including
parent companies and subsidiaries), subsidiaries of joint ventures and subsidiaries of associates. This accounting
policy change affected the judgment of related parties and the disclosure of related party transactions.

For the impact of changes in relevant accounting policies on the Company’s financial statements, please refer
to the relevant content of Note III. 35 “Changes in accounting policies and estimates” to the financial statements
under Section XI “Financial Reports” hereof.

(II) The Company’s analysis of and explanation on the reasons and impacts of the corrections of
major accounting errors
 Applicable  √ N/A

(III) Communications with the former accounting firm

 Applicable  √ N/A

(IV) Other explanation

 Applicable  √ N/A

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 SECTION V  IMPORTANT MATTERS
50
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

VI. Appointment and Dismissal of the Accounting Firm

Unit: ’0,000  Currency: RMB

Currently appointed

Name of domestic accounting firm Ernst & Young Hua Ming LLP (Special General Partnership)

Remuneration of domestic accounting firm 4,010

Audit service years of domestic accounting firm 1

Name Remuneration

Ernst & Young Hua Ming LLP (Special General

Accounting firm for internal control audit 315
Partnership)

Financial adviser / /

Sponsor / /

Explanation on appointment and dismissal of accounting firm

√ Applicable   N/A

According to the relevant regulations and requirements of SASAC, the audit term of the Company’s original auditor
PricewaterhouseCoopers Zhong Tian LLP (hereinafter referred to as “PricewaterhouseCoopers”) has expired.
The Company has fully communicated with PricewaterhouseCoopers on the matter of changing the auditor, and
PricewaterhouseCoopers has no objection to the matter of the Company’s change of accounting firm. During its practice,
PricewaterhouseCoopers adhered to the principle of independent auditing, provided the Company with professional and
rigorous audit services, and earnestly fulfilled its duties as a financial reporting audit agency. The Board of Directors of the
Company hereby expresses its sincere gratitude to PricewaterhouseCoopers for its work.

On May 25, 2020, as considered and approved at the 2019 annual general meeting of the Company, Ernst & Young
Hua Ming LLP (Special General Partnership) was appointed as the auditor for the financial report and internal control of
the Company for 2020, for a term of one year. For details, please refer to the Announcement on Change of Auditor for
Financial Reports published by the Company on February 4, 2020, the Announcement on Change of Auditor for Internal
Control published on April 25, 2020, the Information on 2019 Annual General Meeting published on May 15, 2020, and the
Announcement on Resolutions of 2019 Annual General Meeting published on May 26, 2020.

Explanation on change of accounting firm during the audit period

 Applicable  √ N/A

VII. Risks of Suspension of Listing

(I) Causes of suspension of listing

 Applicable  √ N/A

(II) Measures to be taken by the Company

 Applicable  √ N/A

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 SECTION V  IMPORTANT MATTERS
51
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

VIII. Circumstances of and Reasons for Delisting

 Applicable  √ N/A

IX. Matters Related to Insolvency Reorganization

 Applicable  √ N/A

X. Matters Related to Significant Litigation and Arbitration

 There were significant litigations and arbitrations during the year

√ There was no significant litigation or arbitration during the year

(I) Litigations and arbitrations disclosed in provisional announcements without subsequent

progress
 Applicable  √ N/A

(II) Litigations and arbitrations not disclosed in provisional announcements or with subsequent
progress
 Applicable  √ N/A

(III) Other explanation

 Applicable  √ N/A

XI. Penalty and Rectification for Listed Companies and Their Directors, Supervisors, Senior
Management, Controlling Shareholders, De Facto Controller and Acquirers

 Applicable  √ N/A

XII. Explanation on the Integrity of the Company and Its Controlling Shareholder and De Facto
Controller during the Reporting Period

 Applicable  √ N/A

XIII. Equity Incentive Scheme, Employee Stock Ownership Plan or Other Employee Incentive
Measures of the Company and Their Implications

(I) Relevant incentive matters disclosed in provisional announcements without further progress
or changes in subsequent implementation
√ Applicable   N/A
Summary of matters Index for details
Announcement on the Second
The number of shares subject to the second tranche of unlocking in 2019 in Tranche of Unlocking in 2019 in
respect of phase II restricted A share incentive scheme was 112,527,800, respect of Phase II Restricted A Share
which were listed for circulation on February 14, 2020. Incentive Scheme and Listing of
Shares published on February 5, 2020
It was considered and approved by the Company to repurchase restricted
shares that were subject to restriction on unlocking from 106 participants
involved in the phases II and III restricted A share incentive scheme. A total
of 10,604,200 restricted shares were repurchased, of which, the number
of restricted A shares under phase II and phase III were 7,214,200 shares Announcement on Decrease in
(5,153,000 shares before the reserve capitalization of the Company) and Registered Capital of the Company
3,390,000 shares, respectively. The repurchase of the phase II restricted A after Repurchase and Cancellation
shares were based on the adjusted grant price of RMB3.47571 per share of Part of Phases II and III Restricted
(RMB4.866 per share before the reserve capitalization of the Company), Shares and Notice to Creditors
and the repurchase of the phase III restricted A shares were based on the published on February 20, 2020
price of RMB3.468 per share. The total amount of funds for the repurchase
was RMB36,831,018. After all the repurchased shares are cancelled, the
registered capital of the Company will be reduced by RMB10,604,200 to
RMB41,965,025,511.

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 SECTION V  IMPORTANT MATTERS
52
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Summary of matters Index for details

The Company’s repurchase and cancellation of restricted shares involved
a total of 108 participants of the Company’s phases I, II and III restricted
A share incentive scheme (including simultaneous repurchase from 7
participants of the phase II restricted A shares and phase III restricted
A shares). A total of 10,558,200 restricted shares were proposed to be
repurchased and cancelled (210,000, 7,438,200 and 2,910,000 restricted Announcement on Implementation of
shares under phases I, II and III respectively). After the completion of the Repurchase and Cancellation of Part
repurchase and cancellation, a total of 2,094,667 restricted shares were of Restricted Shares under the Equity
to be repurchased by the Company, including 788,667 phase I restricted Incentive Scheme published on April
shares, 826,000 phase II restricted shares and 480,000 phase III restricted 13, 2020
shares to be repurchased, and 711,468,667 restricted shares under the
share incentive schemes were remained. After the completion of the
repurchase and cancellation, the registered capital and share capital of
the Company will be reduced by RMB10,558,200 (10,558,200 shares) to
RMB41,965,071,511 (41,965,071,511 shares).
Announcement on Resolutions of the
On September 17, 2020, the Proposal on Phase IV Restricted A Share
45th Meeting of the Second Session of
Incentive Scheme of China State Construction Engineering Corporation
the Board of Directors, The Phase IV
Limited (Draft) and Summary was considered and approved at the 45th
Restricted A Share Incentive Scheme
meeting of the second session of the Board of Directors of CSCEC. The
(Draft), and the Announcement on
Company plans to implement the phase IV restricted share scheme. The
Summary of the Phase IV Restricted A
number of participants who will be granted shares under this scheme will not
Share Incentive Scheme (Draft), which
exceed 2,800, mainly key employees who have significant influence on the
were published on September 18,
realization of the Company’s strategic goals.
2020
Announcement on Approval of the
Obtained the “Approval of Implementation of the Phase IV Restricted
Phase IV Restricted A Share Incentive
A Share Incentive Scheme of China State Construction Engineering
Scheme by the State-owned Assets
Corporation Limited” (Guo Zi Kao Fen (2020) No. 527) issued by the SASAC
Supervision and Administration
of the State Council, which permitted in principle the phase IV restricted A
Commission of the State Council
share incentive scheme of the Company.
published on October 14, 2020
On October 23, 2020, the Proposal on the Repurchase of Shares of
the Company through Centralized Bidding Trading was considered and
approved at the 46th meeting of the second session of the Board of
Directors of CSCEC. All of the shares repurchased will be used to implement
the Company’s restricted share scheme. The Company uses its own funds
or self-raised funds to repurchase its shares through centralized bidding
Repurchase Report on the Repurchase
for subsequent implementation of the Company’s restricted share scheme.
of Shares of the Company through
The number of the shares of the Company to be repurchased is not less
Centralized Bidding Trading published
than 500 million shares and not more than 1 billion shares, accounting for
on October 24, 2020
approximately 1.19%-2.38% of its total share capital. The total amount of
repurchase funds is capped at RMB7.660 billion, and the repurchase price
does not exceed RMB7.66 per share. The repurchase period is no longer
than 12 months from the date when the Company’s Board of Directors
considered and approved the A share repurchase proposal, that is, from
October 23, 2020 to October 22, 2021.
The Proposal on the Repurchase of Shares of the Company through
Centralized Bidding Trading was considered and approved at the 46th
meeting of the second session of the Board of Directors and the 28th
meeting of the second session of the Board of Supervisors held by the
Company on October 23, 2020. For the details of this repurchase, please
refer to the Repurchase Report on the Repurchase of Shares of the
Company through Centralized Bidding Trading (Announcement No.: Lin
2020-077) published by the Company on October 24, 2020. Announcement on the Shareholding
of the Top Ten Shareholders and Top
In accordance with relevant requirements, such as the Administrative Ten Shareholders Not Subject to Sales
Measures for the Repurchase of Public Shares by Listed Companies (Trial), Restrictions published on October 29,
the Supplementary Provisions on Repurchasing Shares through Centralized 2020
Bidding Trading by Listed Companies and the Rules for the Implementation
of Share Repurchases by Listed Companies on the Shanghai Stock
Exchange, the names, number of shares, and proportions of the top ten
shareholders and the top ten shareholders not subject to sales restrictions
registered on the trading day (that is, October 23, 2020) before the Board
of Directors announced the resolution to repurchase shares shall be
announced.
On October 30, 2020, the Company repurchased 99,990,045 shares as the
first tranche through centralized bidding trading. The repurchased shares Announcement on the Repurchase
accounted for about 0.24% of the Company’s total share capital. The highest of First Tranche of Shares through
purchase price was RMB5.18 per share, and the lowest price was RMB5.11 Centralized Bidding Trading published
per share. The total amount paid was RMB513,071,799.39 (excluding on October 31, 2020
transaction fees such as stamp duty and transaction commissions).

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 SECTION V  IMPORTANT MATTERS
53
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Summary of matters Index for details

As of October 31, 2020, a total of 99,990,045 shares had been repurchased
by the Company through centralized bidding trading, accounting for Announcement on the Progress
approximately 0.24% of the Company’s total share capital. The highest of Repurchase of Shares through
purchase price was RMB5.18 per share, and the lowest price was RMB5.11 Centralized Bidding Trading published
per share. The total amount paid was RMB513,071,799.39 (excluding on November 4, 2020
transaction fees such as stamp duty and transaction commissions).
As of November 6, 2020, a total of 503,000,072 shares had been
repurchased by the Company through centralized bidding trading, accounting Announcement on Repurchased
for approximately 1.20% of the Company’s total share capital, an increase of Shares of up to 1% in Aggregate and
0.96% compared with the previous disclosure, and the highest purchase was Progress of Share Repurchase by
RMB5.39 per share, the lowest price was RMB5.09 per share, and the total Centralized Bidding Trading published
amount paid was RMB2,608,510,391.36 (excluding transaction fees such as on November 7, 2020
stamp duty and transaction commissions).
On November 20, 2020, the Proposal on the List of Participants and
Information on the Grant with Respect to the Phase IV Restricted A Share
Announcement on Resolutions of the
Incentive Scheme of China State Construction Engineering Corporation
49th Meeting of the Second Session
Limited was considered and approved at the 49th meeting of the second
of the Board of Directors published on
session of the Board of Directors of CSCEC. It was agreed to submit the
November 21, 2020
proposal to the Company’s 2020 third extraordinary general meeting for
consideration and approval.
On November 20, 2020, the Proposal on the Repurchase of Part of
Participants’ Shares under the Phase II and III Restricted A Share Incentive
Scheme of China State Construction Engineering Corporation Limited was
Announcement on the Repurchase
considered and approved at the 49th meeting of the second session of the
of Part of Participants’ Shares under
Board of Directors and the 31st meeting of the second session of the Board
the Phase II and III Restricted A
of Supervisors of CSCEC. It was agreed to repurchase 3,787,000 restricted
Share Incentive Scheme published on
shares from 17 participants at the price of RMB3.47571 per share (phase II)
November 21, 2020
and RMB3.468 per share (phase III) in accordance with the provisions of the
phases II and III restricted A share incentive scheme. The repurchase was
funded by the Company’s own funds, with a total amount of RMB13,139,850.
After review, the Board of Supervisors of the Company was of the view
Announcement on the Resolutions
that the selection of participants of the incentive scheme of the Company
of the 32nd Meeting of the Second
complied with the basis and scope as stipulated in the Phase IV Restricted
Session of the Board of Supervisors,
A Share Incentive Scheme (Draft); and complied with the Administrative
Explanation on the Result of Review
Measures on Share Incentive Schemes of Listed Companies, Guidelines for
by the Board of Supervisors and the
the Implementation of Share Incentive Schemes for Listed Companies under
Publication of the List of Participants
the Control of Central Enterprises and other laws and regulations as well as
of the Company’s Phase IV Restricted
the conditions for participants specified in the Phase IV Restricted A Share
A Shares published on December 2,
Incentive Scheme (Draft), and it was legal and valid for the participants to
2020
join the share incentive scheme.
As of November 30, 2020, a total of 818,000,031 shares had been
repurchased by the Company through centralized bidding trading,
Announcement on the Progress
accounting for approximately 1.95% of the Company’s total share capital
of Repurchase of Shares through
(41,965,071,511 shares). The highest purchase price was RMB5.53 per
Centralized Bidding Trading published
share, the lowest price was RMB5.09 per share, and the total amount paid
on December 3, 2020
was RMB4,294,331,721.11 (excluding transaction fees such as stamp duty
and transaction commissions).
As of December 2, 2020, a total of 860,000,015 shares had been
repurchased by the Company through centralized bidding trading,
Announcement on Repurchased
accounting for approximately 2.05% of the Company’s total share capital
Shares of up to 2% in Aggregate of
(41,965,071,511 shares), an increase of 0.85% compared with the
Share Repurchase by Centralized
previous disclosure. The highest purchase price was RMB5.53 per share,
Bidding Trading published on
the lowest price was RMB5.09 per share, and the total amount paid was
December 3, 2020
RMB4,524,560,341.56 (excluding transaction fees such as stamp duty and
transaction commissions).
In accordance with the relevant provisions of the Administrative Measures on
Self-examination Report on the
the Share Inventive Schemes of Listing Companies, the Company conducted
Trading of Shares of the Company
self-examination on the trading of shares of the Company by persons with
by Persons with Inside Information
inside information related to the incentive schemes. After verification, within
Related to Phase IV Restricted A
six months before the announcement of the draft incentive scheme, we did
Share Incentive Scheme published on
not identify any case of trading by insiders using inside information related to
December 8, 2020
the incentive scheme to buy or sell the shares of the Company.

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 SECTION V  IMPORTANT MATTERS
54
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Summary of matters Index for details

It was considered and approved by the Company to repurchase restricted
shares that were subject to restriction on unlocking from 17 participants
involved in the phases II and III restricted A share incentive scheme. A total
of 3,787,000 restricted shares were repurchased, of which, the number
Announcement on Decrease in
of restricted A shares under phase II and phase III were 847,000 shares
Registered Capital of the Company
(605,000 shares before ex-rights) and 2,940,000 shares, respectively. The
after Repurchase and Cancellation
repurchase of the phase II restricted A shares were based on the adjusted
of Part of Phases II and III Restricted
grant price of RMB3.47571 per share (RMB4.866 per share before the
Shares and Notice to Creditors
reserve capitalization of the Company), and the repurchase of the phase III
published on December 8, 2020
restricted A shares were based on the price of RMB3.468 per share. The
total amount of funds for the repurchase was RMB13,139,850. After all the
repurchased shares are cancelled, the registered capital of the Company will
be reduced by RMB3,787,000 to RMB41,961,284,511.
On December 7, 2020, the Proposal on the Phase IV Restricted A Share Announcement on the Resolutions of
Incentive Scheme of China State Construction Engineering Corporation the 2020 Third Extraordinary General
Limited (Draft) and Summary was considered and approved at the 2020 Meeting published on December 8,
Third Extraordinary General Meeting of CSCEC. 2020
The Company’s share repurchase in respect of phase IV restricted A share
incentive scheme commenced on October 30, 2020 and ended on December Announcement on the Implementation
14, 2020. A total of 912,036,000 shares of the Company was repurchased, Results of Share Repurchase and
accounting for approximately 2.17% of the Company’s total share capital. Changes in Shares published on
The total amount paid was RMB4,792,282,012.54 (excluding transaction December 15, 2020
fees such as stamp duty and transaction commissions).
On December 23, 2020, the Proposal on Granting under Phase IV Restricted
A Share Incentive Scheme of China State Construction Engineering
Corporation Limited was considered and approved at the 50th meeting of the Announcement on Granting under
second session of the Board of Directors and the 33rd meeting of the second Phase IV Restricted A Share Incentive
session of the Board of Supervisors of CSCEC. It was agreed that the grant Scheme published on December 24,
date of the phase IV restricted A share incentive scheme was December 2020
23, 2020, and 2,765 participants will be granted 912.036 million restricted A
shares at the grant price of RMB3.06 per share.
On December 29, 2020, the Proposal on the Third Tranche of Unlocking in
2020 of the Phase II Restricted A Share Incentive Scheme of China State
Construction Engineering Corporation Limited was considered and approved
at the 51st meeting of the second session of the Board of Directors of
CSCEC. It was agreed to arrange the unlocking and listing of the third
Announcement on Resolutions of the
tranche of shares in 2020 for 1,415 participants of the phase II restricted
51st Meeting of the Second Session
A share incentive scheme, with a total of 107.94 million restricted shares
of the Board of Directors published on
unlocked. The Proposal on the First Tranche of Unlocking in 2020 of the
December 30, 2020
Phase III Restricted A Share Incentive Scheme of China State Construction
Engineering Corporation Limited was considered and approved. It was
agreed to arrange the unlocking and listing of the first tranche of shares
in 2020 for 2,041 participants of the phase III restricted A share incentive
scheme, with a total of 195.076 million restricted shares unlocked.
On December 29, 2020, the Proposal on Repurchase of Part of Participants’
Shares under the Phase II and III Restricted A Share Incentive Scheme of
China State Construction Engineering Corporation Limited was considered
and approved at the 51st meeting of the second session of the Board Announcement on the Repurchase
of Directors and the 34th meeting of the second session of the Board of of Part of Participants’ Shares under
Supervisors of CSCEC. It was agreed to repurchase 11,511,000 from 156 the Phase II and III Restricted A
participants at the price of RMB3.47571 per share and RMB3.468 per share Share Incentive Scheme published on
for phase II and phase III respectively, in accordance with the requirements December 30, 2020
of the phases II and III restricted A share incentive scheme. The
repurchase was funded by the Company’s own funds, with a total amount of
RMB39,951,522.
912.036 million restricted shares granted by the Company to participants Announcement on the Progress of
of the phase IV restricted A share incentive scheme will be changed from Granting under Phase IV Restricted A
circulating shares not subject to trading moratorium to circulating shares Share Incentive Scheme published on
subject to trading moratorium on January 13, 2021. January 13, 2021
On January 15, 2021, the Proposal on Repurchase of Part of Participants’ Announcement on the Resolutions of
Shares under the Phase II and III Restricted A Share Incentive Scheme of the 2021 First Extraordinary General
China State Construction Engineering Corporation Limited was considered Meeting published on January 16,
and approved at the 2021 First Extraordinary General Meeting of CSCEC. 2021

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 SECTION V  IMPORTANT MATTERS
55
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Summary of matters Index for details

It was considered and approved by the Company to repurchase restricted
shares that were subject to restriction on unlocking from 156 participants
involved in the phases II and III restricted A share incentive scheme. A total
of 11,511,000 restricted shares were repurchased, of which, the number
Announcement on Decrease in
of restricted A shares under phase II and phase III were 4,067,000 shares
Registered Capital of the Company
(2,905,000 shares before ex-rights) and 7,444,000 shares, respectively. The
after Repurchase and Cancellation
repurchase of the phase II restricted A shares were based on the adjusted
of Part of Phases II and III Restricted
grant price of RMB3.47571 per share (RMB4.866 per share before the
Shares and Notice to Creditors
reserve capitalization of the Company), and the repurchase of the phase III
published on January 16, 2021
restricted A shares were based on the price of RMB3.468 per share. The
total amount of funds for the repurchase was RMB39,951,522. After all the
repurchased shares are cancelled, the registered capital of the Company will
be reduced by RMB11,511,000.
Announcement on the First Tranche
195,076,000 shares were unlocked as the first tranche in 2020 under the of Unlocking in 2020 in respect of
phase III restricted A share scheme, and the date of listing and trading was Phase III Restricted A Share Incentive
January 21, 2021. Scheme and Listing of Shares
published on January 16, 2021
Announcement on the Results of
As of January 14, 2021, a total of 912,036,000 phase IV restricted A shares Grant under Phase IV Restricted A
have been granted. Share Incentive Scheme published on
January 19, 2021
Announcement on the Third Tranche
107,940,000 shares were unlocked as the third tranche in 2020 under the of Unlocking in 2020 in respect of
phase II restricted A share scheme, and the date of listing and trading was Phase II Restricted A Share Incentive
February 18, 2021. Scheme published on February 6,
2021
The Company’s repurchase and cancellation of restricted shares involved
a total of 185 participants of the Company’s phases I, II and III restricted
A share incentive scheme (including simultaneous repurchase from 42
participants of the phase II restricted A shares and phase III restricted
A shares). A total of 16,903,667 restricted shares were proposed to be Announcement on Implementation of
repurchased and cancelled (578,667, 5,621,000 and 10,704,000 restricted Repurchase and Cancellation of Part
shares under phases I, II and III respectively). After the completion of the of Restricted Shares under the Equity
repurchase and cancellation, a total of 489,000 restricted shares were to be Incentive Scheme published on April 7,
repurchased by the Company, and 1,303,585,000 restricted shares under 2021
the share incentive schemes were remained. After the completion of the
repurchase and cancellation, the registered capital and share capital of
the Company will be reduced by RMB16,903,667 (16,903,667 shares) to
RMB41,948,167,844 (41,948,167,844 shares).

(II) Incentive not disclosed in provisional announcements or with subsequent progress

Information of equity incentives

 Applicable  √ N/A

Other explanation

√ Applicable   N/A

For implications of the restricted shares of the Company on its financial position and operating results, please
refer to the related information of Note XI “Shares-based payment” to the financial statements under Section XI
“FINANCIAL REPORT” hereof.

Information of employee stock ownership plan

 Applicable  √ N/A

Other incentives

 Applicable  √ N/A

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 SECTION V  IMPORTANT MATTERS
56
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

XIV. Material Related Party Transactions

(I) Related party transactions relating to ordinary course of business

1. Matters disclosed in provisional announcements without further progress or changes in

subsequent implementation
√ Applicable   N/A
Summary of matter Index for details
On April 24, 2020 and May 25, 2020, the Proposal in respect of Daily Related
Party Transaction of China State Construction Engineering Corporation Limited
for 2020 was considered and approved at the 37th meeting of the second
session of the Board of Directors, the 19th meeting of the second session of the
Board of Supervisors and 2019 annual general meeting of the Company.
The Company and China State Construction signed the Comprehensive
Services Framework Agreement Between China State Construction Engineering
Corporation and China State Construction Engineering Corporation Limited in
respect of the related party transactions arising from the sales, procurement,
commercial factoring services, financial leasing services, property leasing and
other business between the Company, and China State Construction and its
subsidiaries. Specifically, the sales between the Company and China State
Construction and its subsidiaries shall not exceed RMB2.5 billion; procurement
shall not exceed RMB3.0 billion; the maximum balance of commercial factoring
services (excluding those from CSC Finance) shall not exceed RMB0.5 billion,
and factoring interest and service fee shall not exceed RMB0.04 billion; the
maximum balance of financial leasing services (excluding those from CSC
Finance) shall not exceed RMB0.3 billion, and leasing interest and service fee
shall not exceed RMB0.025 billion; property leasing shall not exceed RMB0.2
billion; other daily related party transactions shall not exceed RMB0.6 billion
(RMB0.2 billion for interest on capital borrowings, RMB0.1 billion for signing
trademark license agreement, and RMB0.3 billion for others). Announcement on Daily Related
Party Transactions under
CSC Finance, a subsidiary of the Company, and China State Construction the Comprehensive Services
signed the Financial Services Framework Agreement Between China State Framework Agreement and the
Construction Engineering Corporation and China State Construction Finance Financial Services Framework
Co., Ltd. in respect of the related party transactions arising from the deposits, Agreement Signed with China
loans, financial and financing consultancy and other relevant financial services State Construction Engineering
provided to China State Construction and its subsidiaries from CSC Finance. Corporation published on April
During the term of the agreement, the daily balance cap of the deposits (inclusive 25, 2020
of accrued interests thereon) to be placed by China State Construction and its
subsidiaries with CSC Finance shall not exceed RMB20.0 billion, with the daily Announcement on Resolutions
balance of loans (inclusive of accrued interests thereon) to be obtained not of 2019 Annual General
exceeding the daily balance cap of the deposits (inclusive of accrued interests Meeting published on May 26,
thereon); the fees to be charged by CSC Finance in respect of the other financial 2020
services provided by it to China State Construction and its subsidiaries shall not
exceed RMB0.3 billion.
As of December 31, 2020, the sales business involved between the Company
and China State Construction and its subsidiaries was RMB1.06 billion; the
procurement business was RMB2.88 billion; the maximum balance of the
commercial factoring business (excluding those from CSC Finance) was
RMB8.19 million, the factoring interest and service fees were RMB230,000; no
financial leasing service business was conducted; the property lease was RMB40
million; other daily related party transactions were RMB90 million (RMB70 million
for interest on capital borrowings, RMB0.1 million for signing trademark license
agreement, and RMB0.2 billion for others). The amount of actual daily related
party transaction of the Company was within the budget.
In 2020, the daily balance cap of the deposits (inclusive of accrued interests
thereon) of China State Construction and its subsidiaries in CSC Finance was
RMB7.9 billion; the maximum daily loan balance (inclusive of accrued interests
thereon) was RMB5.98 billion; the service fee charged by CSC Finance for
providing other financial services to China State Construction and its subsidiaries
was RMB484,200. Within the scope of the Financial Services Framework
Agreement and the supplementary agreement, the service fee has not reached
5% of audited net assets of the Company for the latest period.

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 SECTION V  IMPORTANT MATTERS
57
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Summary of matter Index for details

On December 29, 2020 and January 15, 2021, the Proposal on the Renewal
of the Comprehensive Services Framework Agreement between China State
Construction Engineering Corporation Limited and China State Construction
Engineering Corporation was considered and approved at the 51st meeting of
the second session of the Board of Directors, the 34th meeting of the second
session of the Board of Supervisors and 2021 first extraordinary general meeting
of the Company. Announcement on the Renewal
of the Comprehensive Services
The Company and China State Construction renewed the Comprehensive Framework Agreement between
Services Framework Agreement Between China State Construction Engineering the Company and China State
Corporation and China State Construction Engineering Corporation Limited in Construction Engineering
respect of the related party transactions arising from the sales, procurement, Corporation and Daily Related
commercial factoring services, financial leasing services, property leasing and Party Transaction published on
other business between the Company, and China State Construction and its December 30, 2020
subsidiaries. During the term of the agreement, the sales between the Company
and China State Construction and its subsidiaries shall not exceed RMB3.1 Announcement on the
billion; procurement shall not exceed RMB9.2 billion; the maximum balance of Resolutions of the 2021 First
commercial factoring services (excluding those from CSC Finance) shall not Extraordinary General Meeting
exceed RMB0.5 billion, and factoring interest and service fee shall not exceed published on January 16, 2021
RMB0.03 billion; the maximum balance of financial leasing services (excluding
those from CSC Finance) shall not exceed RMB0.2 billion, and financial leasing
interest and service fee shall not exceed RMB0.01 billion; property leasing shall
not exceed RMB0.2 billion; other daily related party transactions shall not exceed
RMB0.6 billion (RMB0.35 billion for interest on capital borrowings, RMB0.05
billion for signing trademark license agreement, and RMB0.2 billion for others).
On December 29, 2020 and January 15, 2021, the Proposal on the Renewal of
the Financial Services Framework Agreement between China State Construction
Finance Co., Ltd. and China State Construction Engineering Corporation was
considered and approved at the 51st meeting of the second session of the Board
Announcement on the Renewal
of Directors, the 34th meeting of the second session of the Board of Supervisors
of the Financial Services
and 2021 first extraordinary general meeting of the Company.
Framework Agreement between
CSC Finance, a subsidiary of the Company, and China State Construction China State Construction
renewed the Financial Services Framework Agreement Between China State Finance Co., Ltd. and China
Construction Engineering Corporation and China State Construction Finance State Construction Engineering
Co., Ltd. in respect of the related party transactions arising from the deposits, Corporation and Daily Related
loans, financial and financing consultancy and other relevant financial services Party Transaction published on
provided to China State Construction and its subsidiaries from CSC Finance. December 30, 2020
During the term of the agreement, the daily balance cap of the deposits (inclusive
Announcement on the
of accrued interests thereon) to be placed by China State Construction and its
Resolutions of the 2021 First
subsidiaries with CSC Finance shall not exceed RMB20.0 billion, with the daily
Extraordinary General Meeting
balance of loans (inclusive of accrued interests thereon) to be obtained not
published on January 16, 2021
exceeding the daily balance cap of the deposits (inclusive of accrued interests
thereon); the fees to be charged by CSC Finance in respect of the other financial
services provided by it to China State Construction and its subsidiaries shall not
exceed RMB0.3 billion.
On December 29, 2020, the Proposal on the Provision of Entrusted Loan by
China State Construction Engineering Corporation to China State Construction
Engineering Corporation Limited was considered and approved at the 51st Announcement on Provision
meeting of the second session of the Board of Directors and the 34th meeting of of Entrusted Loans to the
the second session of the Board of Supervisors of the Company. Company by its Controlling
On December 30, 2020, the Company signed the Entrusted Loan Contract with Shareholder and Related Party
China State Construction and CSC Finance, according to which, the Company Transactions published on
will be granted an entrusted loan in the amount of RMB1.5 billion by China State December 30, 2020.
Construction, with a term of 1 year and an interest rate of 2.99% per annum. The
principal borrowed under the contract was utilized for daily operations.

2. Matters disclosed in provisional announcements but with further progress or changes in

subsequent implementation
 Applicable  √ N/A

3. Matters not disclosed in provisional announcements

 Applicable  √ N/A

(II) Related party transactions as a result of acquisition or disposal of assets or equity

1. Matters disclosed in provisional announcements without further progress or changes in

subsequent implementation
 Applicable  √ N/A

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 SECTION V  IMPORTANT MATTERS
58
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

2. Matters disclosed in provisional announcements but with further progress or changes in

subsequent implementation
 Applicable  √ N/A

3. Matters not disclosed in provisional announcements

 Applicable  √ N/A

4. Disclosure of performance achieved for the Reporting Period if with agreed-upon

performance targets
 Applicable  √ N/A

(III) Material related party transactions in joint external investment

1. Matters disclosed in provisional announcements without further progress or changes in

subsequent implementation
√ Applicable   N/A

Summary of matter Index for details

On November 9, 2020, the Proposal on the Capital Increase in China

State Construction Finance Co., Ltd. by the Company and its Controlling
Shareholders and Related Party Transactions was considered and
approved at the 48th meeting of the second session of the Board of
Directors and the 30th meeting of the second session of the Board of
Supervisors of the Company.
China State Construction Engineering Corporation Limited and China
State Construction Engineering Corporation contributed to the capital
increase in China State Construction Finance Co., Ltd. in cash based on
the current proportion of their shareholding in China State Construction
Finance Co., Ltd., among which, the contribution of CSCEC and China
State Construction was RMB3.2 billion and RMB800 million, respectively.
Announcement on the
Upon the completion of the capital increase, the registered capital of
Capital Increase in
CSC Finance will increase to RMB10 billion.
China State Construction
This matter constituted a related party transaction, but does not Finance Co., Ltd. by the
constitute a major asset reorganization as required by the Management Company and its Controlling
Measures for Major Asset Reorganization of Listed Companies. As of Shareholders and Related
this related party transaction, except for the related party transactions Party Transactions published
with China State Construction that have been considered and approved on November 10, 2020.
at the Company’s general meeting, the related party transactions
between the Company and China State Construction within the past
12 months have not reached 5% of audited net assets of the Company
for the latest period, and the related party transaction does not need to
be submitted to the Company’s general meeting for consideration. The
related party transaction was conducted in accordance with fair and
reasonable commercial terms, and the pricing was fair and reasonable.
The transaction followed the principles of objectivity, equity and fairness,
and was in the interest of the Company. There was no matter that would
harm the interests of shareholders, especially minority shareholders.
This related party transaction will not have a negative impact on the
Company.

2. Matters disclosed in provisional announcements but with further progress or changes in

subsequent implementation
 Applicable  √ N/A

3. Matters not disclosed in provisional announcements

 Applicable  √ N/A

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 SECTION V  IMPORTANT MATTERS
59
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(IV) Creditor’s rights and debts with related parties

1. Matters disclosed in provisional announcements without further progress or changes in

subsequent implementation
 Applicable  √ N/A

2. Matters disclosed in provisional announcements but with further progress or changes in

subsequent implementation
 Applicable  √ N/A

3. Matters not disclosed in provisional announcements

 Applicable  √ N/A

(V) Miscellaneous
√ Applicable   N/A

For related party transactions of the Company, please refer to the related information of Note X “Related party
relationships and transactions” to the financial statements under Section XI “FINANCIAL REPORT” hereof.

XV. Material Contracts and Fulfillment Thereof

(I) Custody, contracting, and leasing

1. Custody
 Applicable  √ N/A

2. Contracting
 Applicable  √ N/A

3. Leasing
 Applicable  √ N/A

(II) Guarantees
√ Applicable   N/A

BAR21010002_E_CSCEC 2020AR()_.indb 59 2021/5/21 13:19:44

 60
Unit: ’000 yuan  Currency: RMB
Guarantees provided to external parties by the Company (excluding guarantees provided to subsidiaries)
Relationship Commencement Guarantee
between date of Commencement Fulfillment Counter provided
Guaranteed Expiry date of Overdue Overdue Related
Guarantor guarantor Guaranteed party guarantee date of Type of guarantee completed guaranteed to the
amount guarantee or not amount relationship
and the listed (execution date guarantee or not or not related
company of agreement) party or not

BAR21010002_E_CSCEC 2020AR()_.indb 60
China State Construction Wuhan Communications Investment Group December 24, Joint and several
Within the Company 3,500,000 April 21, 2015 May 23, 2027 No No 0 Yes No Other
Engineering Corporation Limited Limited Company 2014 liability guarantee
Guangzhou Lihe Property Development
China Overseas Land & Joint and several
Holding subsidiary Company Limited 127,880 July 13, 2018 July 13, 2018 May 21, 2021 No No 0 No Yes Associate
Investment Ltd. liability guarantee
(广州利合房地产开发有限公司)
Guangzhou Lihe Property Development
China Overseas Land & Joint and several
Holding subsidiary Company Limited 280,000 April 22, 2019 April 22, 2019 April 21, 2022 No No 0 No Yes Associate
Investment Ltd. liability guarantee
(广州利合房地产开发有限公司)
Guangzhou Lihe Property Development
China Overseas Land & Joint and several
SECTION V  IMPORTANT MATTERS

Holding subsidiary Company Limited 180,000 June 29, 2020 June 29, 2020 June 28, 2023 No No 0 No Yes Associate
Investment Ltd. liability guarantee
(广州利合房地产开发有限公司)
Chongqing Jiayi Property Development
China Overseas Land & November 20, November 20, November 19, Joint and several
Holding subsidiary Company Limited 82,950 No No 0 No Yes Joint venture
Investment Ltd. 2020 2020 2025 liability guarantee
(重庆嘉益房地产开发有限公司)
Chongqing Jiayi Property Development
China Overseas Land & Joint and several
Holding subsidiary Company Limited 32,500 March 16, 2017 March 16, 2017 March 15, 2022 No No 0 No Yes Joint venture
Investment Ltd. liability guarantee
(重庆嘉益房地产开发有限公司)
Chongqing Jiayi Property Development
China Overseas Land & Joint and several
Holding subsidiary Company Limited 135,150 April 14, 2017 April 14, 2017 March 15, 2022 No No 0 No Yes Joint venture
Investment Ltd. liability guarantee
(重庆嘉益房地产开发有限公司)
Chongqing Jiayi Property Development
China Overseas Land & Joint and several
Holding subsidiary Company Limited 39,850 March 21, 2017 March 21, 2017 March 15, 2022 No No 0 No Yes Joint venture
Investment Ltd. liability guarantee
(重庆嘉益房地产开发有限公司)
Chongqing Jiayi Property Development
China Overseas Land & Joint and several
Holding subsidiary Company Limited 175,000 July 5, 2017 July 5, 2017 March 15, 2022 No No 0 No Yes Joint venture
Investment Ltd. liability guarantee
(重庆嘉益房地产开发有限公司)
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Guangzhou Pik Sum Real Estate Development

China Overseas Land & December 11, December 11, Joint and several
Holding subsidiary Company Limited 186,525 February 1, 2021 No No 0 No Yes Associate
Investment Ltd. 2018 2018 liability guarantee
(广州碧森房地产开发有限公司)
Guangzhou Pik Sum Real Estate Development
China Overseas Land & December 26, December 26, December 25, Joint and several
Holding subsidiary Company Limited 142,784 No No 0 No Yes Associate
Investment Ltd. 2018 2018 2020 liability guarantee
(广州碧森房地产开发有限公司)
Guangzhou Lvrong Property Development
China Overseas Land & November 13, November 13, November 29, Joint and several
Holding subsidiary Company Limited 292,883 No No 0 No Yes Associate
Investment Ltd. 2018 2018 2021 liability guarantee
(广州绿嵘房地产开发有限公司)
Guangzhou Lvrong Property Development
China Overseas Land & Joint and several
Holding subsidiary Company Limited 33,320 April 11, 2019 April 11, 2019 April 10, 2022 No No 0 No Yes Associate
Investment Ltd. liability guarantee
(广州绿嵘房地产开发有限公司)
Guangzhou Lvrong Property Development
China Overseas Land & September 30, September 30, September 29, Joint and several
Holding subsidiary Company Limited 98,960 No No 0 No Yes Associate
Investment Ltd. 2019 2019 2022 liability guarantee
(广州绿嵘房地产开发有限公司)
China Overseas Land & Changsha Xirong Real Estate Co., Ltd. Joint and several
Holding subsidiary 154,595 January 14, 2020 January 14, 2020 December 9, 2021 No No 0 No Yes Associate
Investment Ltd. (长沙禧荣置业有限公司) liability guarantee
Total amount of guarantees provided during the Reporting Period (excluding guarantees provided to subsidiaries) 479,542
Total balance of guarantees as of the end of the Reporting Period (A) (excluding guarantees provided to subsidiaries) 5,462,397

2021/5/21 13:19:45
 Unit: ’000 yuan  Currency: RMB
Guarantees provided to external parties by the Company (excluding guarantees provided to subsidiaries)
Relationship Commencement Guarantee
between date of Commencement Fulfillment Counter provided
Guaranteed Expiry date of Overdue Overdue Related
Guarantor guarantor Guaranteed party guarantee date of Type of guarantee completed guaranteed to the

BAR21010002_E_CSCEC 2020AR()_.indb 61
amount guarantee or not amount relationship
and the listed (execution date guarantee or not or not related
company of agreement) party or not
Guarantees provided by the Company and its subsidiaries to its subsidiaries
Total amount of guarantees provided to subsidiaries during the Reporting Period -8,736,994
Total balance of guarantees provided to subsidiaries as of the end of the Reporting Period (B) 24,635,898
Total amount of guarantees provided by the Company (including guarantees provided to subsidiaries)
Total amount of guarantees (A+B) 30,098,295
Total amount of guarantees as a percentage of the net assets of the Company (%) 10.0%
Of which:
Amount of guarantees provided to shareholders, de facto controller and their related parties (C) 0
Amount of debt guarantees provided directly or indirectly to guaranteed parties with an asset-liability ratio of over 70% (D) 24,635,898
Total amount of guarantees exceeding 50% of net assets (E) 0
Total of the above three classes of guarantees (C+D+E) 24,635,898
Explanation on contingent joint and several liability for undue guarantees N/A
As of the end of the Reporting Period, the balance of the guarantees provided by the Company to external parties (excluding the guarantees and mortgages provided to its holding subsidiaries) amounted to RMB5.462 billion, excluding the mortgages provided by the Company to purchasers of
Explanation on property in its real estate operations, the balance of the guarantees provided by the Company to such purchasers for their mortgage amounted to RMB88.072 billion, which were the guarantees provided by the Company to banks for the secured loans of the purchasers of commodity houses which
guarantees will be offered as collaterals by such purchasers. During the Reporting Period, there was no default on the part of the purchasers and the relevant risks arising from provision of such guarantees the Company was exposed to remained relatively low.
As of the end of the Reporting Period, the balance of the guarantees provided by the Company to its holding subsidiaries amounted to RMB24.636 billion, which had all gone through approval procedures in strict accordance with relevant rules.
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
SECTION V  IMPORTANT MATTERS
61

2021/5/21 13:19:45
 SECTION V  IMPORTANT MATTERS
62
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(III) Cash asset management entrusted to others

1. Entrusted wealth management

(1). Overall wealth management

 Applicable  √ N/A

(2). Single entrusted wealth management

 Applicable  √ N/A

(3). Impairment provision for entrusted wealth management

 Applicable  √ N/A

2. Entrusted loans

(1). Overall entrusted loans

√ Applicable   N/A

Unit: ’000 yuan  Currency: RMB

Outstanding Amount due but
Type Source of funds Amount incurred
balance not recovered
General entrusted
Self-owned funds -493,387 1,064,002 0
loan

Others

√ Applicable   N/A

As of the end of the Reporting Period, the total external entrusted loan of the Company amounted
to approximately RMB1.064 billion, which was mainly incurred from the financing and investing
activities conducted by the Company to drive its general contracting projects. Please refer to the
related contents of Note V. (12) “Debt investments” to the financial statements under Section XI
“FINANCIAL REPORT” hereof.

(2). Single entrusted loans

 Applicable  √ N/A

Others

 Applicable  √ N/A

(3). Impairment provision for entrusted loans

 Applicable  √ N/A

3. Other investments and wealth management and derivative investments

 Applicable  √ N/A

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 SECTION V  IMPORTANT MATTERS
63
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(IV) Other material contracts

√ Applicable   N/A

1. Major domestic business contracts during the Reporting Period

Unit: 100 million yuan  Currency: RMB
No. Name of contract Signing Party Value of contract Type of contract
General construction contract for Tianjin Metro Line 7 phase I project (天津 China State Construction Engineering Infrastructure
地铁7号线一期工程施工总承包合同)
1 151.30
Corporation Limited construction
General construction contract for Shenzhen Rail Transit Line 13 phase II
(Northern Extension) project (深圳市城市轨道交通13号线二期（北延）工程
China State Construction Engineering Infrastructure
2 120.56
施工总承包合同)
Corporation Limited construction

General construction contract of Chengdu Rail Transit Line 27 phase I China Construction Third Engineering Infrastructure
3 93.59
project (成都轨道交通27号线一期工程施工总承包项目工程合同) Bureau Co., Ltd. construction
General EPC contract in connection with design, procurement and
construction of the composite development project of Ningxiang High- China Construction First Group Infrastructure
4 93.11
speed railway new city (宁乡高铁新城综合开发项目设计采购施工总承包 Corporation Limited construction
EPC工程合同)
China State Construction Engineering
Civil works project contract of Shandong section of the new Zhengzhou- Infrastructure
5 Corporation Limited, China Construction 77.01
Jinan Railway (新建郑州至济南铁路山东段站前工程项目合同) construction
Eighth Engineering Division Corp. Ltd.
General contract in relation to urban renovation and redevelopment of
China Construction Fourth Engineering Housing
6 industrial land of Xindian Industrial Park (信电产业园城市更新工改项目施 77.00
工总承包合同)
Division Corp. Ltd. construction

China Construction Eighth Engineering

General construction contract of the terminal building of Urumqi
Division, China Construction Third Infrastructure
7 International Airport reconstruction and extension project (乌鲁木齐国际机 70.33
场改扩建工程航站楼施工总承包合同)
Engineering Division, CSCEC Xinjiang construction
Construction & Engineering (Group)
General contract for the composite project in relation to the design,
procurement and construction in rebuilding of dilapidated houses
in Longdejing Area, and urban renovation investment and project China State Construction Engineering Infrastructure
8 59.33
management in Goutou Area, Chengxiang District, Putian City (莆田市城厢 Corporation International Operations construction
区龙德井片区危旧房改造、沟头片区城市更新投资及工程管理设计采购施工
一体化项目工程合同)
General construction contract of the B1, B2, C, D1, D2, E groups of
Second Construction Limited Company
resettlement housing and -C group of supporting facilities in Rongdong Housing
9 of China Construction Eighth Engineering 57.56
Area (容东片区B1、B2、C、D1、D2、E组团安置房及配套设施项目-C组团 construction
施工总承包合同)
Division

General EPC contract of National Convention and Exhibition Center phase China Construction Eighth Engineering Housing
10 53.03
II project (国家会展中心工程二期项目EPC总承包工程合同) Division Corp. Ltd. construction
General construction contract of urban renovation units in Laiwushan,
China Construction Third Bureau First Housing
11 Longhua District, Shenzhen (深圳市龙华区赖屋山城市更新单元项目施工总 51.60
承包工程合同)
Engineering Co., Ltd. construction

General contract of Xinhai City (phase II and III) project (心海城（二期、三 China Construction Fourth Engineering Housing
期）项目总承包工程合同)
12 51.20
Division Corp. Ltd. construction
Engineering contract of general sub-contracting project of Hangzhou
China Construction Fourth Engineering Housing
13 Grand Convention and Exhibition Center (杭州大会展中心项目总包代建项 51.06
目工程合同)
Division Corp. Ltd. construction

Engineering contract of Xining Beichuan Wanda Plaza (西宁北川万达广场 China Construction Eighth Engineering Housing
工程合同)
14 51.00
Division Corp. Ltd. construction
China Construction Second Engineering Housing
15 Construction contract of Anqing Wanda (安庆万达工程施工合同) 50.86
Division Corp. Ltd. construction
General construction contract of Dongfang Jindian Vitality New City project China Construction Seventh Engineering Housing
16 50.60
(东方今典活力新城项目施工总承包合同) Division. Corp. Ltd. construction
General EPC contract in relation to the prospecting, design and
China Construction Third Bureau First Housing
17 construction of Hengqin International Business Center phase II project (横 50.38
琴国际商务中心二期项目勘察设计施工总承包EPC工程合同)
Engineering Co., Ltd. construction

General engineering contract of the construction of CITIC Financial Center China Construction Third Engineering Housing
18 50.11
in Shenzhen, Guangdong (广东深圳中信金融中心施工总承包工程合同) Bureau Co., Ltd. construction

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 SECTION V  IMPORTANT MATTERS
64
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million yuan  Currency: RMB

No. Name of contract Signing Party Value of contract Type of contract
General construction contract of Alibaba Xixi phase V project (阿里巴巴西 China Construction Third Bureau First Housing
溪五期项目施工总承包施工合同)
19 48.08
Engineering Co., Ltd. construction
Jinan Main Campus project contract of Qilu Medical University (齐鲁医科 China Construction Eighth Engineering Housing
大学济南主校区项目合同)
20 47.05
Division Corp. Ltd. construction
General EPC contract of Made in China 2025 industrial park construction
project (phase II) (中国制造2025产业园建设项目（二期工程）EPC总承包项
First Construction Co., Ltd. of China Housing
21 46.80
目合同)
Construction Eighth Engineering Division construction

Linyi Xicheng Headquarters Economic Zone infrastructure construction First Construction Co., Ltd. of China Infrastructure
project (EPC) contract (临沂西城总部经济区基础设施建设项目（EPC）合同)
22 46.00
Construction Eighth Engineering Division construction
General EPC contract in relation to the prospecting, design and
China Construction Fifth Engineering Housing
23 construction of Hengqin Science City (phase III) tender section II project (横 44.89
琴科学城（三期）标段二勘察设计施工总承包EPC工程合同)
Division Corp., Ltd. construction

General construction contract of Canton Fair Complex phase IV extension China Construction Eighth Engineering Housing
24 44.30
project (广交会展馆四期展馆扩建项目施工总承包合同) Division Corp. Ltd. construction
General contract of project in Lanshui Area, Longgang District, Yitian (益田 China Construction First Group Housing
龙岗兰水项目总承包工程合同)
25 43.98
Corporation Limited construction
General contract in relation to design, procurement and construction of
China Construction Fourth Engineering Infrastructure
26 Guangzhou Football Stadium project (广州足球场项目设计采购施工总承包 43.00
合同)
Division Corp. Ltd. construction

Civil construction contract for the Northeast Section of Zhengzhou Rail

China State Construction Engineering Infrastructure
27 Transit Line 6 phase I project (郑州市轨道交通6号线一期工程东北段土建 42.65
施工合同)
Corporation Limited construction

General EPC contract of Ningbo International Convention Center project China Construction Eighth Engineering Housing
28 42.02
(宁波国际会议中心项目EPC工程总承包合同) Division Corp. Ltd. construction
China Construction First Group
Jin Lang 22-1 project contract in Shenhe District, Shenyang (沈阳市沈河区 Housing
金廊22-1项目合同)
29 Construction & Development Co., Ltd. (中 41.66
建一局集团建设发展有限公司)
construction

China State Construction Engineering

Corporation Limited, China State
General EPC contract of the first section of Xi’an High-tech International
Construction Silkroad Construction Housing
30 Conference Center phase II project in Shaanxi (陕西西安高新国际会议中 41.57
心二期项目一标段EPC总承包合同)
Investment Group Co., Ltd, China construction
Construction Eighth Engineering Division
Corp. Ltd.
Underground space project contract of delivery and distribution ring area
China Construction Eighth Engineering Infrastructure
31 of the Fuzhou Binhai New City CBD core area (福州滨海新城CBD核心区输 40.86
配环区域工程地下空间项目合同)
Division Corp. Ltd. construction

General engineering contract in relation to prospecting, design and

construction of Liujia Panlong Village Relocation Housing Construction
China Construction Third Engineering Housing
32 project (Shanty Area Renovation) in Guandu District (官渡区六甲盘龙村回 40.85
迁安置房建设项目（棚户区改造）勘察、设计、施工总承包项目工程总承包
Bureau Co., Ltd. construction
合同)
Contract of No. 1-5 residential building, No. 6 Office building, No. 7
commercial building and No. 8-10 basement project of Pengrui Tian Yue China Construction Fifth Engineering Housing
33 40.39
Square (鹏瑞天玥广场1-5号住宅楼，6号办公室，7号商业楼，8-10号地下 Division Corp., Ltd. construction
室工程合同)
General EPC contract for general high school construction project in
China Construction Infrastructure Co., Infrastructure
34 Yunnan Province (tender section one) (云南省普通高中建设项目EPC总承 40.28
包（标段一）EPC总承包合同)
Ltd. construction

General construction contract of Suning Evergrande Center of Nanjing China Construction First Group Housing
35 40.00
Olympic CBD (南京奥体CBD苏宁恒大中心施工总承包工程合同) Corporation Limited construction
Construction contract of Chongqing Jiangjin Wanda Plaza project (重庆江 China Construction Second Engineering Housing
津万达广场工程施工合同)
36 40.00
Division Corp., Ltd. construction
General contract of PPP project of composite development (new
urbanization pilot) of Qiaolin Old Town Area in Pukou District, Nanjing (南 China Construction Seventh Engineering Infrastructure
京市浦口区桥林老城片区综合开发（新型城镇化试点）PPP项目工程总承包
37 39.79
Division. Corp. Ltd. construction
合同)

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 SECTION V  IMPORTANT MATTERS
65
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million yuan  Currency: RMB

No. Name of contract Signing Party Value of contract Type of contract
General construction contract of 5G new infrastructure communication China Construction Seventh Bureau
Infrastructure
38 project in Zhengzhou, Henan (河南郑州5G新基建通信工程项目施工总承包 Installation Engineering Co., Ltd. (中建七 39.10
合同) 局安装工程有限公司)
construction

General engineering contract of Lot G29C, Yanziji, Nanjing, Jiangsu China Construction Third Engineering Housing
39 38.48
Province, China (中国江苏省南京市燕子矶G29C地块总承包工程合同) Bureau Co., Ltd. construction
Nanjing Jinling Cultural and Creative Park (Jinling Town) project contract China Construction Eighth Engineering Infrastructure
(南京金陵文化创意园（金陵小镇）项目合同)
40 38.23
Division Corp. Ltd. construction
Relocation and renovation project contract of Shenkeng Village, Liuyue, China Construction First Group Housing
41 38.00
Longgang, Shenzhen (深圳市龙岗区六约深坑村拆迁旧改项目合同) Corporation Limited construction
General construction contract of D009X-TA01 tender of Nanjing Metro Line
China Construction Eighth Engineering Infrastructure
42 9 phase I project (南京地铁9号线一期工程施工总承包D009X-TA01标施工 37.40
合同)
Division Corp. Ltd. construction

General construction contract of Pengrui Yijingfu project, Shenzhen, China Construction Fifth Engineering Housing
43 37.02
Guangdong (广东深圳鹏瑞颐璟府项目施工总承包工程合同) Division Corp., Ltd. construction
Construction and pipeline relocation contract of Changchun Rail Transit
China State Construction Engineering Infrastructure
44 Line 2 (Eastern extension) project (长春市城市轨道交通2号线东延工程施 36.92
工及管线迁改合同)
Corporation Limited construction

Design and construction (EPC) contract of relocation and reconstruction

project of Shantou Central Hospital (major pandemic case treatment base) China Construction Eighth Engineering Housing
(汕头市中心医院易地重建项目（重大疫情救治基地）设计施工一体化（EPC）
45 36.59
Division Corp. Ltd. construction
合同)
Xiamen New Sports Center project (construction) tender section I contract China Construction Eighth Engineering Infrastructure
(厦门新体育中心工程（施工）Ⅰ标段合同)
46 36.25
Division Corp. Ltd. construction
Project contract of K2 plot in Wuhan Central Cultural District (武汉中央文 China Construction Eighth Engineering Housing
化区K2地块项目合同)
47 36.02
Division Corp. Ltd. construction
General construction contract of Chongqing-Hunan Double-track Line
China State Railway Investment Infrastructure
48 expressway project (sections under the second general contract) (渝湘复 35.76
线高速公路施工总承包合同（第二总承包合同段）)
Construction Group Co., Ltd. construction

General contract of Kylin Artificial Intelligence Industrial Park C and D area Third Construction Co., Ltd of China Housing
49 34.44
project (麒麟人工智能产业园C、D区项目总承包合同) Construction Eighth Engineering Division construction
General construction contract of the second tender section of the Xiong’an
China Construction Eighth Engineering Housing
50 Business Service Center project (雄安商务服务中心项目二标段施工总承包 34.01
合同)
Division Corp. Ltd. construction

Shaoxing High-speed Railway North Station TOD complex project (Block A) China Construction Eighth Engineering Infrastructure
contract (绍兴高铁北站TOD综合体项目（A区块）合同)
51 33.88
Division Corp. Ltd. construction
General construction contract in relation to the design and construction of
the Guangzhou International Campus phase II of South China University China Construction Fifth Engineering Housing
of Technology (the first batch) (华南理工大学广州国际校区二期工程（第一
52 33.82
Division Corp., Ltd. construction
批次）设计施工总承包合同)
General construction (unit price) contract of overall renovation project China Construction Sixth Bureau South
Housing
53 (phase II) of Baoan District Municipal People’s Hospital (宝安区人民医院整 China Co., Ltd. (中建六局华南建设有限公 33.50
体改造工程（二期）施工总承包施工(单价)合同) 司)
construction

Contract of comprehensive improvement engineering project for non-

compliant water (Qianshan River Basin, Qijiang River Basin-Banfu Town, China Construction Eighth Engineering Infrastructure
54 33.25
Nanlang Basin) in Zhongshan, Guangdong (广东中山市未达标水体综合整 Division Corp. Ltd. construction
治工程项目（前山河流域、岐江河流域-板芙镇、南朗流域）合同)
China State Construction Engineering
Corporation Limited, China State
General EPC contract for the second tender section of the Xi’an High-tech
Construction Silkroad Construction Housing
55 International Conference Center phase II project in Shaanxi (陕西西安高新 32.80
国际会议中心二期项目二标段EPC总承包合同)
Investment Group Co., Ltd, China construction
Construction Eighth Engineering Division
Corp. Ltd.

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 SECTION V  IMPORTANT MATTERS
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million yuan  Currency: RMB

No. Name of contract Signing Party Value of contract Type of contract
Engineering contract of warehouses of Buildings C1 and C2 in Lot 05-A-
China Construction Fourth Engineering Housing
56 015 of Lingshang Life Commercial Center (领尚生活商贸中心05-A-015地 32.50
块C1栋仓储、C2栋仓储工程合同)
Division Corp. Ltd. construction

Civil works contract of New Laixi-Rongcheng Railway Station (新建莱西至 China State Construction Engineering Infrastructure
荣成铁路站前工程合同)
57 31.50
Corporation Limited construction
General contract in relation to design, procurement and construction (EPC)
of Guilin International Convention and Exhibition Center project (phase I)
China Construction Eighth Engineering Housing
58 (except the second reception center and supporting commercial facilities 31.34
and bus terminals) (桂林国际会展中心项目一期工程（除第二接待中心及配
Division Corp. Ltd. construction
套商业、公交首末站）设计-采购-施工（EPC）工程总承包合同)
China Construction Eighth Bureau South
Housing
59 Heyuan Wanfu project contract (河源万福项目合同) China Co., Ltd. (中建八局华南建设有限公 31.33
司)
construction

General construction contract of the first tender section of the terminal

China Construction Eighth Engineering Infrastructure
60 area of Hohhot New Airport (呼和浩特新机场航站区第一标段施工总承包合 30.87
同)
Division Corp. Ltd. construction

General contract in relation to 9 projects for road engineering projects in

China Construction Communications Infrastructure
61 West Coast New Area in Qingdao (青岛西海岸新区道路工程9个项目等工 30.87
程总承包合同)
Engineering Group Co., Ltd construction

General engineering contract of Kongshankuang Area of Jiangsu

Gardening Expo Garden (Weilai Garden) (江苏园博园孔山矿片区（未来花
China Construction Eighth Engineering Infrastructure
62 30.87
园）工程工程总承包合同)
Division Corp. Ltd. construction

General engineering contract of Nanjing China Central Place International Third Construction Co., Ltd of China Housing
63 30.80
Center (南京华贸国际中心总承包工程合同) Construction Third Engineering Bureau construction
Construction engineering contract (Zhongdian Digital Health Industrial CSCEC Strait Construction and Housing
Park) (建设工程施工合同（中电数字健康产业公园）)
64 30.67
Development Co., Ltd. construction
Construction contract of civil works project of the first tender section of
China State Construction Engineering Infrastructure
65 Dalian Metro Line 4 (phase I) (大连地铁4号线一期工程土建施工一标建设 30.62
工程施工合同)
Corporation Limited construction

Fourth Construction Co., Ltd of China

Construction engineering contract of Bailihui Lan Hai Zheng Feng project Housing
66 Construction Seven Engineering Division 30.54
(百力汇蓝海郑风项目建设工程施工合同) construction
(中建七局第四建筑有限公司)
General EPC contract of Ezhou Public Health Clinical Center project (phase China Construction Third Engineering Housing
I) (鄂州市公共卫生临床中心项目（一期）EPC总承包工程合同)
67 30.08
Bureau Co., Ltd. construction
General construction contract in relation to prospecting, design and
China Construction Third Engineering Housing
68 construction of Nano Smart Technology Park (phase II) project (纳米智能 30.01
技术科技园（二期）项目勘察设计施工总承包工程合同)
Bureau Co., Ltd. construction

General EPC Contract for Education Training Center and Public Service
China Construction Fifth Engineering Housing
69 Center project in Suiyang District, Shangqiu City (商丘市睢阳区教育培训中 30.00
心及便民服务中心项目EPC总承包合同)
Division Corp., Ltd. construction

Construction contracting contract of Changsha Greenland V Island project China Construction Seventh Engineering Housing
70 30.00
(长沙绿地V岛项目施工承包合同) Division. Corp., Ltd. construction
Urban-rural integration composite construction project contract of new-type
China Construction Eighth Engineering Infrastructure
71 community in villages in Bincheng District (滨城区农村新型社区城乡一体化 30.00
综合建设项目合同)
Division Corp. Ltd. construction

Note: The contracts listed above are mainly sourced from the statistics of the contracts actually entered into by the
Company as of the end of the Reporting Period.

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 SECTION V  IMPORTANT MATTERS
67
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

2. Major overseas business contracts during the Reporting Period

Unit: 100 million dollars  Currency: USD
No. Name of contract Signing Party Value of contract Type of contract
General EPC contract of Makati Metro project in the Philippines (菲律宾马 China Construction Second Engineering Infrastructure
卡蒂地铁大交通项目EPC总承包合同)
1 12.13
Division Corp. Ltd. construction
General contracting contract in respect of the phosphoric acid plant project China State Construction Engineering Infrastructure
2 8.51
in Abuta, Egypt (埃及阿布塔磷酸厂项目工程总承包合同) Corporation Limited construction
China State Construction Engineering
General contracting (comprehensive) construction contract in respect of (Hong Kong) Limited and China Housing
the Studio City Macao project (新濠影汇项目总包（综合）施工合同)
3 8.35
Construction Engineering (Macao) construction
Company Limited
General contracting (engineering & construction) contract in respect of the
China Construction Third Engineering Infrastructure
4 terminal project of the New Phnom Penh International Airport (新金边国际 5.96
机场航站楼总承包（设计&建造）工程合同)
Division Corp. Ltd. construction

Site A contract of NKIL6549 residential buildings in Cheung Sha Wan (长 China Overseas Building Construction Housing
沙湾NKIL6549住宅Site A合同)
5 4.14
Limited (中国海外房屋工程有限公司) construction
China Construction First Group
Construction contract of headquarters of the International Financial Center Corporation Limited
Housing
6 at downtown Manila, the Philippines (菲律宾马尼拉国际金融中心总部市中 China Construction UCF Group 3.93
心城项目一期工程合同)
construction
(Philippines) Co., Ltd. (中国建筑先锋集团
（菲律宾）有限公司)
Contract in respect of the landmark tower project in Indonesia (印尼地标塔 China Construction First Group Housing
项目工程合同)
7 3.85
Corporation Limited construction
Tseung Kwan O desalination plant project contract (phase I) (将军澳海水 China State Construction Engineering Infrastructure
化淡厂第一阶段项目合同)
8 3.55
(Hong Kong) Limited construction
Contracts in relation to AMBAL-SIMUAY and floods control project in China State Construction Engineering Infrastructure
9 2.79
Mindanao, Philippines (菲律宾棉兰老岛AMBAL-SIMUAY和防洪项目合同) Corporation Limited construction
Contract in relation to Wong Chuk Hang station phase II development China Overseas Building Construction Housing
10 2.78
project with Kerry Properties (嘉里黄竹坑站二期发展合同) Limited (中国海外房屋工程有限公司) construction
Contract in relation to Sri Lanka 28km-long water diversion tunnel project China State Construction Engineering Infrastructure
11 2.34
(斯里兰卡28公里引水隧道项目合同) Corporation Limited construction
Contract in respect of the residential housing project at No. 128 Wong Ma Treasure Construction Engineering Housing
12 2.28
Kok Road, Stanley (赤柱黃麻角道128號住宅项目合同) Limited construction
General contract of #U REKA commercial complex (#U REKA商业综合体总 China Construction Malaysia Co., Ltd. (中 Housing
承包工程合同) 国建筑马来西亚有限公司)
13 2.05
construction
China Construction Xiaoxiang
(Uzbekistan) Co., Ltd. (中建潇湘（乌兹别
General construction contract of Tashkent Haitong City (Hong Kong) Housing
project (海通城（香港）项目施工总承包合同)
14 1.96
克斯坦）有限公司)
construction

China Construction Philippines

Main structure engineering contract of the seaside south bank project (海 Housing
滨南岸项目主体结构工程合同)
15 Construction and Development Co., Ltd. 1.91
construction
(中建菲律宾建设发展有限公司)
China Construction Xianfeng Group
General construction contract of the Zhongsai Port commercial complex Housing
16 (Zrenjanin) Co., Ltd. (中国建筑先锋集团 1.91
（兹雷尼亚宁）有限公司)
project in Belgrade (贝尔格莱德中塞港商业综合体项目施工总承包合同) construction

Engineering contract in respect of the Training Center HTTC (CCDC) of China Construction (South Pacific) Housing
the Ministry of Home Affairs (内政部训练中心HTTC (CCDC)工程合同)
17 1.84
Development Co. Pte. Ltd. construction
China Construction First Group
Contract of the superstructure of Makati Metro Station 3 in the Philippines Corporation Limited Housing
18 1.80
(菲律宾马卡蒂地铁3号站上盖物业项目合同) China Construction First Group construction
Corporation Limited Philippines branch
Engineering contract in respect of the HDB flat – TPN2 (CCDC) in China Construction (South Pacific) Housing
Tampines (淡滨尼组屋-TPN2 (CCDC)工程合同)
19 1.69
Development Co. Pte. Ltd. construction
Construction contract in respect of the phase II project of Addis Ababa China State Construction Engineering Infrastructure
20 1.64
National Stadium (亚的斯亚贝巴国家体育场二期项目施工合同) Corporation Limited construction
Engineering contract of China-Thailand Complex Logistics Industrial Park,
China Construction Fifth Engineering Infrastructure
21 a high-end ecological logistics complex in Bangkok, Thailand (泰国曼谷高 1.59
端生态物流综合体中泰综合物流产业园项目工程合同)
Division Corp., Ltd. construction

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 SECTION V  IMPORTANT MATTERS
68
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: 100 million dollars  Currency: USD

No. Name of contract Signing Party Value of contract Type of contract
New contract in relation to the Mong Ha social housing construction project
China Construction Engineering (Macao) Infrastructure
Co., Ltd. (中国建筑工程（澳门）有限公司)
22 – phase II and Mong Ha gymnasium reconstruction project (望厦社会房屋 1.51
建造工程－第二期暨望厦体育馆重建工程新增合同)
construction

Engineering contract of Cameroon 225kV EBOLOWA-KRIBI and

90kV MBALMAYO-MEKIN transmission line and related engineering China Construction Fifth Engineering Infrastructure
construction project (喀麦隆225kV EBOLOWA-KRIBI和90kV MBALMAYO-
23 1.43
Division Corp., Ltd. construction
MEKIN输电线路及相关工程建设项目工程合同)
Contract in respect of the Bulim infrastructure works phase I ((BL1)-CSCEC China Construction Representative Office Infrastructure
24 1.43
works) (武林基础设施工程一期(BL1)-CSCEC工程合同) in Singapore construction
China Construction Engineering
(Thailand) Co., Ltd. (中国建筑工程（泰国）
Civil works contract of China-Thailand high-speed railway 3-2 (中泰高铁3-2 Infrastructure
土建工程合同)
25 1.34
有限公司)
construction

Foundation works contract of public housing in Kai Tak 2B&2B6 and Chiu
China Construction Engineering (Hong Housing
26 Shun Road, Tseung Kwan O (启德2B&2B6及将军澳昭信路公屋地基工程合 1.12
同)
Kong) Co., Ltd. construction

China Construction Engineering

Housing
27 Tropicana Grandhill Plot5 (Southeast Asia) Malaysia Co., Ltd. (中国 1.11
建筑（东南亚）马来西亚有限公司)
construction

Note: The contracts listed above are mainly sourced from the statistics of the contracts actually entered into by the
Company as of the end of the Reporting Period.

3. Newly-signed comprehensive credit facility contracts

Unit: 100 million yuan/dollars  Currency: RMB/USD
Name of comprehensive Comprehensive
No. Credit grantor Accredited party Credit period
credit facility contract credit facility limit
China State
China Minsheng
Comprehensive credit Construction January 9, 2020 –
1 Banking Corp., Ltd. RMB6.0 billion
facility contract Engineering January 8, 2021
Beijing Branch
Corporation Limited
China State
Master agreement on
The Export-Import Construction April 2, 2020 –
2 trading and financial RMB15.0 billion
Bank of China Engineering December 6, 2020
credit facility business
Corporation Limited
China State March 4, 2020 – no
HSBC Bank (China)
Construction fixed expiry date (subject
3 Credit facility letter Company Limited USD0.2 billion
Engineering to the results of annual
Beijing Branch
Corporation Limited review by the bank)
China State
China Export &
Guaranteed credit facility Construction April 26, 2020 – April
4 Credit Insurance USD0.52 billion
agreement Engineering 25, 2020
Corporation
Corporation Limited
Bank of China State
Comprehensive credit Communications Construction July 17, 2020 – July 14,
5 RMB20.0 billion
facility contract Beijing Fuwai Sub- Engineering 2022
branch Corporation Limited
Bank of China China State
Credit facility limit Beijing Sub-branch Construction December 28, 2020 –
6 RMB35.8 billion
contract at Bank of China Engineering December 1, 2021
Head Office Corporation Limited
China Guangfa Bank China State
Credit facility limit Beijing Sub-branch Construction October 16, 2020 –
7 RMB4.7 billion
contract at Qinghua East Engineering October 15, 2020
Road Corporation Limited

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

4. Newly-signed strategic cooperation and business cooperation agreement

During the Reporting period, the Company continued to increase its strategic cooperation with various
local governments, large domestic and foreign enterprises and financial institutions. The following are the
major cooperation agreements entered into by the Company.
No. Name of contract Signing date Contents of contract
To respond positively to the initiative between the Chinese and Japanese
governments to strengthen Sino-Japanese cooperation and joint
Strategic cooperation development of third country markets, this memorandum aimed to promote,
memorandum expand and deepen the cooperation between CSCEC and ORIX, and
between China take advantage of the experience and strength of both parties, pursuant to
January 21,
1 State Construction which both parties will strive to build up in-depth partnership in respect of
2020
Engineering development and operation of property projects such as complex property
Corporation Limited development projects, office, commercial facilities operation, airport
and Orix Corporation development and operation, integrated logistics center, metro hub TOD, etc.
in China and actively extend cooperation in project development outside
China.
Cooperation
Based on the development needs of Hubei Province and taking into account
agreement on
the competitive edges of CSCEC, the key areas of cooperation have been
promoting Wuhan’s
identified as follows: strengthening cooperation in employment and talent
post-pandemic
training, enhancing training on industrial workers, actively helping Hubei
revitalization and high-
Province to recover and revitalize its economy, strengthening exchanges
quality development August 18,
2 and cooperation with enterprises in Hubei, vigorously promoting industry-
between Wuhan 2020
academia-research cooperation, increasing investment and development in
Municipal People’s
key infrastructure, steadily enhancing comprehensive urban development,
Government and China
accelerating industrialization of construction and actively exploring
State Construction
construction-related emerging fields and new technologies, science,
Engineering
education, culture and health and other livelihood projects.
Corporation Limited
Based on the actual needs of economic development planning and land
planning of Qingdao, and taking into account the development of CSCEC,
strategic cooperation has been further explored through a combination
of promotion by the local government and market-based operation.
Specific measures included: promoting the civil-military joint development
and setting up exemplary projects; strengthening cooperation in respect
of mixed ownership reform of state-owned enterprises and creating a
Strategic cooperation
new model of cooperation between the central enterprises and the local
agreement between
government; leveraging the advantages of CSCEC’s international operation,
Qingdao Municipal
making coordination to promote the BRI, and local economic and trade
People’s Government September 11,
3 cooperation initiatives proposed by Qingdao Free Trade Zone and Shanghai
and China State 2020
Cooperation Organization, and jointly building up a new high level of
Construction
opening up; helping Qingdao in operating infrastructure, innovating property
Engineering
management service mode, refining the management and operation of
Corporation Limited
urban construction, and upgrading the cityscape; deeply participating
in the construction of Qingdao metropolitan area, effectively promoting
infrastructure facilities, focusing on regional development and urban
renewal, contributing to the enhancement of the city’s accommodation
capacity, and continuously optimizing the city’s appearance; participating in
the upgrading of the construction industry, and enhancing the city’s living
quality and so on.
CITIC Securities Company Limited provided securities, financial and
investment advisory services for CSCEC headquarters and its subsidiaries
Strategic cooperation
with its complete set of licensed products and business lines to support
agreement
CSCEC in respect of business development, global operation, capital
between China
operation, management of market capitalization, asset management, fund
State Construction December 2,
4 raising and other daily securities and financial needs. This included but not
Engineering 2020
limited to the following business services: investment banking, management
Corporation Limited
of market capitalization, research, industrial investment, asset management
and CITIC Securities
and cash management, equity trading, fixed income, custody, government
Company Limited
regulatory, and other domestic and foreign securities and financial full-
service.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

XVI. Explanation on Other Material Matters

 Applicable  √ N/A

XVII. Active Fulfillment of Social Responsibilities

(I) Poverty alleviation by the listed company

√ Applicable   N/A

1. Targeted poverty alleviation planning

√ Applicable   N/A
The Company and its controlling shareholder, China State Construction, were decisive in implementing
the decisions and deployment of the Party Central Committee, the State Council and SASAC to reduce
poverty and carry out targeted poverty alleviation, and actively assumed the social responsibilities and
obligations as a backbone central enterprise. Since 2013, we have been providing targeted and concrete
assistance to Kangle County, Zhuoni County and Kang County in Gansu Province (referred to as the three
counties of Gansu). A series of targeted and effective precise assistance were provided from education
to employment, from people’s livelihood improvement to enriching people’s lives through industrial
development, from optimizing local infrastructure facilities to promoting the building-up of beautiful villages.
In 2020, based on the performance of poverty alleviation work and survey results of lifting poverty-stricken
population out of poverty, the Company’s controlling shareholder, China State Construction, studied
and developed the 2020 Poverty Alleviation Highlights and Implementation Plan on Further Enhancing
the Poverty Alleviation Efforts in Kangle County, and entered into the Agreement on Targeted Poverty
Alleviation and Agreement on Poverty Alleviation by Promoting Consumption with the three counties of
Gansu, providing a detailed planning for the poverty alleviation throughout the year. According to the
implementation plan of the Company’s three-year action plan to reduce poverty, in conjunction with the
Company’s advantage of “whole industrial chain” in the construction industry, the Company was devoted
to proceeding with the pandemic prevention and control measures and reducing poverty, solving the
prominent problems in connection with the “No Worries about Food and Clothing with Compulsory
Education, Basic Medical Care and Housing Safety Guaranteed” initiative, persistently making “combined
efforts” in reducing poverty through industrial development, employment, education, consumption and
Communist Party building, with a view to supporting the three counties of Gansu to win the final battle of
poverty alleviation.

2. Summary of annual targeted poverty alleviation

√ Applicable   N/A
In 2020, the Company and its controlling shareholder, China State Construction, resolutely implemented the
“four continuing requirements”, made concrete efforts to strengthen organizational leadership, increased
resource investment and constantly proceeded with the targeted poverty alleviation approach. Specifically,
the Company convened 5 poverty alleviation progressing meeting, 45 on-site meetings, 6 inspections of the
Company’s executives for supervision on poverty alleviation, 8 in-depth research visits to the three counties
of Gansu, 11 discussion and exchange meetings with local administration of the three counties of Gansu
and the cities and prefectures governing such three countries on how to fight and win the battle against
poverty, and appointed 763 leaders and cadres at all levels to conduct research and supervision visits on
targeted poverty alleviation; the Company invested and raised funds at a total amount of RMB109,449,600
and carried out 129 poverty alleviation projects including “Kangle Basong Rural Tourism Service Center,
CSCEC-Zhuoni County Characteristic Industry Demonstration Zone Phase II and Kang County Poverty
Alleviation through Tourism Development Demonstration Zone Phase II”; the Company dispatched 14
persons to fulfill the temporary poverty alleviation posts and 12 predominant subsidiaries to make joint
efforts to lift the three counties of Gansu out of poverty while other subsidiaries fully participated in poverty
alleviation by promoting consumption; the Company also called for the contributions by different social
parties in this regard, including China Foundation for Poverty Alleviation, China Women’s Development
Foundation, Guo Mingyi, Gansu Institute of Architectural Design and Research Co., Ltd. and CCTV Man
and Nature program team, to build a multi-engagement pattern of poverty alleviation; we also convened 42
sessions of poverty alleviation special trainings, with participants of primary-level cadres and technicians
in three counties in Gansu amounting to 3,408; the Company gave support to 132 e-commerce enterprises
(cooperative entities), arranged 376 promotion activities for poverty alleviation through consumption, built
up more than 50 characteristic brands and purchased and helped to sell agricultural products sourced
from poor areas worth RMB68,440,000; the Company held 26 special job fairs for boosting employment
and labor transmission and transfer, providing more than 4,000 jobs, established 34 demonstration villages
for facilitating export of construction labor, as a result of which 2,799 local poor residents were employed;
the Company invested special funds to carry out “emergency relief” campaign. The measure package
included helping 103 impoverished households in Zhuoni County to renovate their roads, houses, water
supply facilities, electricity supply facilities, livestock environment, toilets and stoves, purchasing automatic
biochemical analyzers for township healthcare center in Kang County, installing heating equipment and
repairing 65 water purification valve wells for 15 township healthcare centers in Kangle County. Our
campaign has benefited more than 100,000 local people and helped China State Construction to play
a vital role in winning the final battle against poverty for the three counties of Gansu. Currently, all three
counties in Gansu have been removed from the poverty-stricken county list, helping a total of 196,000
impoverished people out of poverty and all 345 impoverished villages removed out of the poverty-stricken
list. In particular, Zhuoni County was selected as one of the counties under the “China’s most beautiful
counties list”, Kangle County was awarded as “China’s most beautiful rural tourism destination in the new
era”, and Kang County was listed as the “permanent venue of the Beautiful Village Alliance Forum under
the BRI. CSCEC has been awarded the highest rating in the evaluation of targeted poverty alleviation
performance of central enterprises for three consecutive years.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

3. Effectiveness of targeted poverty alleviation

√ Applicable   N/A
Unit: ’0,000 yuan  Currency: RMB
Amount/Quantity &
Indicators
Implementation
I. General
Including: 1. Fund 10,697.31
2. Materials converted into cash 114.26
3. Number of registered impoverished people relieved from
195,915
poverty under assistance
II. Investment breakdown
1. Poverty alleviation through industrial development
√ Agricultural and forestry
√ Tourism
√ E-commerce
Including: 1.1 Type of industrial projects for poverty alleviation
 Asset income
 Technology
√ Others
1.2 Number of industrial projects for poverty alleviation 31
1.3 Amount of investment in industrial projects for
7,283.06
   poverty alleviation
1.4 Number of registered impoverished people relieved
28,558
   from poverty under assistance
2. Poverty alleviation through transfer of labor
Including: 2.1 Amount of investment in occupational skill training 720.80
2.2 Number of persons receiving vocational skill training
3,408
   (person/time)
2.3 Number of registered impoverished people getting
2,799
   employed under assistance
3. Poverty alleviation through relocation
Including: 3.1 Number of persons getting employed for relocated
/
       households under assistance
4. Poverty alleviation through education
Including: 4.1 Amount of investment in financing needy students 55.87
4.2 Number of poor students financed 460
4.3 Amount of investment in improving the educational
1,518.75
   resources in poverty-stricken areas
5. Poverty alleviation through healthcare improvement
Including: 5.1 Amount of investment in the medical and health
261.21
       resources in poverty-stricken areas
6. Poverty alleviation through ecological protection
√ Carry out ecological
conservation and
maintenance
 Establish compensation
ways for ecological
Including: 6.1 Name of project conservation
 Set up specialized posts
for handling ecological
and public charity related
affairs
 Others
6.2 Amount of investment 82.00
7. Baseline security
Including: 7.1 Amount of investment in helping left-behind elderly,
/
       women and children in rural areas
7.2 Number of left-behind elderly, women and children
/
   receiving the help
7.3 Amount of investment in helping needy disabled people 100

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Unit: ’0,000 yuan  Currency: RMB

Amount/Quantity &
Indicators
Implementation
7.4 Number of needy disabled people receiving the help 359
8. Poverty alleviation efforts offered by the society
Including: 8.1 Amount of investment in coordinated eastern-western /
       poverty alleviation efforts
8.2 Amount of investment in targeted poverty alleviation 10,811.57
8.3 Public social charitable fund for poverty alleviation /
9. Other projects
Including: 9.1. Number of projects 41
9.2. Amount of investment 1,575.68
9.3. Number of registered impoverished people relieved 20,748
   from poverty under assistance
The Company organized
19 Party branches from 8
subsidiaries to work in pairs
with Party branches from
19 impoverished villages in
the three counties of Gansu
province to “carry out the
Communist Party building
initiatives and promote
poverty alleviation”. The
Company established 37
9.4. Description about other projects poverty alleviation projects in
the Party building initiatives,
implemented 2 drinking
water safety and housing
safety projects, supported
132 leading enterprises and
cooperatives in the three
counties of Gansu and
purchased and helped to sell
agricultural products sourced
from poor areas worth
RMB68,440,000 and so on.
III. Awards received (content and level)
CSCEC was awarded as the Advanced Group for Assistance in Battle of Poverty Alleviation in
Gansu Province (provincial and ministerial level);
CSCEC was awarded as the Advanced Group for Assistance in Battle of Poverty Alleviation in Linxia
Hui Autonomous Prefecture (prefecture level);
CSCEC received the highest rating in the evaluation of targeted poverty alleviation performance of
central enterprises for three consecutive years;
Its “CSCEC Model” of targeted poverty alleviation was selected into the Blue Book on Corporate
Poverty Alleviation released by the State Council Leading Group Office of Poverty Alleviation and
Development and the series of books entitled “Poverty Alleviation – Power of Central Enterprises”《(脱
贫攻坚•央企力量》 ) compiled by the News Center of SASAC and the People’s Political Consultative
Daily. Its poverty alleviation program was included by the State Council Leading Group Office of
Poverty Alleviation and Development in the “Top 50 Comprehensive Cases for Targeted Poverty
Alleviation by Corporates” and “Top 50 Cases for Poverty Alleviation by Volunteers”.

4. Subsequent targeted poverty alleviation plan

√ Applicable   N/A
In 2021, CSCEC will resolutely implement the decisions and deployment under the rural revitalization
strategy proposed by the Party Central Committee and the State Council, fully conform to the “four
continuing requirements” proposed by the central government to maintain the strength, depth and extent
of targeted poverty alleviation. Responding to the prominent problems and defects in comprehensively
consolidating the results of poverty alleviation in the three counties of Gansu, measures will be taken to
further increase the support in the exchange of cadres and talents, the development of characteristic
industries, the improvement of education quality, assistance for the needy, infrastructure construction, etc.
We will focus on consolidating and extending the results of poverty alleviation and its effective connection
with rural revitalization, help targeted areas to achieve industrial thrive, ecological livability, civilized
countryside, effective governance and economic prosperity and contribute more to becoming a modern
socialist country and the realization of Chinese dream of great rejuvenation of the Chinese nation. The
main measures include: developing and expanding characteristic industries, fulfilling advantage in whole
industrial chain, supporting tourism development planning of targeted poverty alleviation areas, introducing
signature tourism-related products, boosting the development of the homestay industry; stimulating
employment continuously, increasing publicity, mobilization and special job fairs to support employment,
promoting building-up of labor demonstration villages, providing skills training for rural entrepreneurs and
unemployed people; further promoting poverty alleviation through development of education campaign
“Spring Buds Action”, sticking to the spirit of reducing poverty physically and mentally, introducing “CSCEC
Happiness Courses Plan”, improving education infrastructure and competency of teachers and facilitating
the integrated development of urban and rural compulsory education; increasing support to e-commerce
businesses, maintaining assistance in procurement and marketing of e-commerce businesses, refining
online and offline sales systems, promoting the commercialization and branding of agricultural specialty
products; further enhancing Party-building in pairs with other Party units to increase interaction and
exchange between the Company’s relevant Party units and the Party units in local villages by taking the
opportunity of learning and education of CPC’s history, and to trigger the party organizations’ role as the
fortress and the general public’s endogenous motivated force by arranging joint themed CPC day and
Party member voluntary services.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(II) Social responsibility commitments

√ Applicable   N/A

The Company will disclose the 2020 Social Responsibility Report headed “CSCEC 2020 Sustainability Report” on
the website of Shanghai Stock Exchange. Please refer to the relevant content of the report for relevant information
of social responsibility commitments of the Company.

(III) Environmental information

1. Explanation on environmental protection efforts of the highly polluting companies and

their key subsidiaries as announced by the environmental protection authority
 Applicable  √ N/A

2. Explanation on environmental protection efforts of companies other than highly polluting

companies
√ Applicable   N/A

Guided by President Xi Jinping’s ideology on ecological civilization, the Company thoroughly implements
the decision and deployment on ecological environmental protection of the Party Central Committee
and the State Council, earnestly materializes the new development concept and fulfills the Company’s
responsibility of environmental protection to continue to promote the in-depth ecological environment
protection.

During the Reporting Period, the Company was not aware of any unexpected environmental incidents or
major environmental pollution accidents. The Company closely focuses on the latest national policies and
regulations, strives to improve the environmental protection management system, continuously carries
out the identification and rectification of environmental risks and hazards, and continuously increases
supervision and regulation through special inspections and comprehensive examinations. The Company
is highly concerned about the awareness and capacity building of environmental protection, incorporates
environmental management training into the overall training plan, and organizes training and publicity
activities through on-site training, experience exchange, case sharing, internal observation, etc. Throughout
the year, the Company organizes more than 1,200 various training and publicity events on environmental
protection, with more than 38,000 participants, and hosts more than 173 observation activities at the local
and municipal levels.

The Company continuously strengthens the environmental protection and pollution prevention and control
of construction projects. For construction projects invested by the Company, it insists on conducting
assessment on environmental impact according to law, and comprehensively incorporates environmental
protection requirements into the entire process of design, construction and operation to ensure the
simultaneous design, construction, production and delivery of pollution prevention facilities and the main
construction works. For the construction projects the Company undertakes, the Company carries out
identification of material environmental elements and environmental management planning as required,
specifies the environmental management objectives of the project concerned, equips itself with and
regulates the operation of various pollution prevention and control facilities. In addition, we highly value the
promotion and application of energy-saving and environmental protection technologies, namely “four-new”
technologies. We strive to reduce pollution and material loss at source, reduce energy consumption and
improve recycling efficiency through the promotion of the new, green and smart construction with a view to
advancing the environmental protection and pollution prevention and control efforts.

3. Explanation on reasons for not disclosing environmental information by companies other

than highly polluting companies
 Applicable  √ N/A

4. Explanation on the subsequent progress or changes in the environmental information

disclosure during the Reporting Period
 Applicable  √ N/A

(IV) Other explanation

 Applicable  √ N/A

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

XVIII. Convertible Corporate Bonds

(I) Issue of convertible bonds

 Applicable  √ N/A

(II) Holders and guarantors of convertible bonds during the Reporting Period
 Applicable  √ N/A

(III) Changes in convertible bonds during the Reporting Period

 Applicable  √ N/A

Accumulated number of shares converted from convertible bonds during the Reporting Period

 Applicable  √ N/A

(IV) Previous adjustments to conversion price

 Applicable  √ N/A

(V) Information on the Company’s liability and the changes in credit standing as well as the cash
arrangement for the future annual debt repayment
 Applicable  √ N/A

(VI) Other information of convertible bonds

 Applicable  √ N/A

XIX. Index of Information Disclosure

During the Reporting Period, the Company published 187 documents on the website of the Shanghai Stock Exchange
(www.sse.com.cn), and related announcements were also published in the China Securities Journal, Shanghai Securities
News, Securities Daily, and Securities Times.
No. Matter Disclosure Date
1 CSCEC: Briefing on Business from January to December 2019 January 10, 2020
2 CSCEC: Announcement on Significant Project January 18, 2020
CSCEC: Independent Opinions of Independent Directors on Appointment of the
3 February 4, 2020
Company’s Auditor for Financial Reports in 2020
4 CSCEC: Notice on Convening of the 2020 First Extraordinary General Meeting February 4, 2020
CSCEC: Independent Director’s Prior Approval of Opinions on Appointment of the
5 February 4, 2020
Company’s Auditor for Financial Reports in 2020
CSCEC: Independent Opinions of Independent Directors on Redemption of 150,000,000
6 February 4, 2020
Unlisted Preferred Shares of the Company
CSCEC: Announcement on Amendments to the Articles of Association of China State
7 Construction Engineering Corporation Limited and the Rules of Procedure of the General February 4, 2020
Meeting of China State Construction Engineering Corporation Limited
8 CSCEC: Announcement on Change of Auditor for Financial Reports February 4, 2020
9 CSCEC: Rules of Procedure of the General Meeting (2020 Revised Draft) February 4, 2020
10 CSCEC: Articles of Association (2020 Revised Draft) February 4, 2020
CSCEC: Announcement on Resolutions of the 18th Meeting of Second Session of Board
11 February 4, 2020
of Supervisors

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

No. Matter Disclosure Date

12 CSCEC: First Holding Announcement on Redemption of Unlisted Preferred Shares February 4, 2020
CSCEC: Announcement on Resolutions of the 34th Meeting of Second Session of Board
13 February 4, 2020
of Directors
CSCEC: Legal Opinions of King & Wood Mallesons on Relevant Matters regarding
14 Second Tranche of Unlocking in 2019 in Respect of Phase II Restricted A Share February 5, 2020
Incentive Scheme of China State Construction Engineering Corporation Limited
CSCEC: Announcement on the Second Tranche of Unlocking in 2019 in Respect of
15 February 5, 2020
Phase II Restricted A Share Incentive Scheme and Listing of Shares
16 CSCEC: Information on the 2020 First Extraordinary General Meeting February 12, 2020
17 CSCEC: Briefings on Business in January 2020 February 15, 2020
18 CSCEC: Announcement on Significant Project February 20, 2020
19 CSCEC: Second Holding Announcement on Redemption of Unlisted Preferred Shares February 20, 2020
CSCEC: Announcement on Decrease in Registered Capital of the Company after
20 Repurchase and Cancellation of Part of Phase II and III Restricted Shares and Notice to February 20, 2020
the Creditors
21 CSCEC: Announcement on Resolutions of the 2020 First Extraordinary General Meeting February 20, 2020
22 CSCEC: Legal Opinions on the 2020 First Extraordinary General Meeting February 20, 2020
23 CSCEC: Articles of Association (Revised in February 2020) February 20, 2020
24 CSCEC: Rules of Procedure of the General Meeting (Revised in February 2020) February 20, 2020
25 CSCEC: Third Holding Announcement on Redemption of Unlisted Preferred Shares February 21, 2020
CSCEC: Announcement on Distribution of Dividends for Preferred Shares (Tranche I) of
26 February 22, 2020
2019-2020
CSCEC: Holding Announcement on the Suspension of Trading of Unlisted Preferred
27 February 26, 2020
Shares
28 CSCEC: Announcement on Redemption and Delisting of All Unlisted Preferred Shares February 26, 2020
29 CSCEC: Announcement on Results of the Redemption of All Unlisted Preferred Shares March 4, 2020
30 CSCEC: Announcement on Appointment of the President of the Company March 5, 2020
CSCEC: Independent Opinions of Independent Directors on Appointment of Zheng
31 March 5, 2020
Xuexuan as the Company’s President
CSCEC: Announcement on Resolutions of the 35th Meeting of the Second Session of
32 March 5, 2020
Board of Directors
33 CSCEC: Briefings on Business from January to February 2020 March 14, 2020
34 CSCEC: Announcement on Significant Project March 20, 2020
CSCEC: Legal Opinions of King & Wood Mallesons on Relevant Matters regarding
Repurchase and Cancellation of Part of Restricted Shares under Phase I, II and
35 April 13, 2020
III Restricted A Share Incentive Scheme of China State Construction Engineering
Corporation Limited
CSCEC: Announcement on Implementation of Repurchase and Cancellation of Part of
36 April 13, 2020
Restricted Shares under the Equity Incentive Scheme
37 CSCEC: Briefings on Business from January to March 2020 April 17, 2020
CSCEC: Advance Announcement on Performance Presentation and Cash Dividend
38 April 22, 2020
Meeting of 2019
39 CSCEC: 2019 Sustainability Report April 25, 2020
40 CSCEC: Summary of 2019 Annual Report April 25, 2020
CSCEC: Announcement on Daily Related Party Transactions under the Comprehensive
41 Services Framework Agreement and the Financial Services Framework Agreement April 25, 2020
Signed with China State Construction Engineering Corporation
CSCEC: Independent Opinions of Independent Directors on Proposal of the Company’s
42 April 25, 2020
Daily Related Party Transactions in 2020
43 CSCEC: Accounting Firm’s Audit Report on the Company’s Internal Control April 25, 2020
CSCEC: Independent Opinions of Independent Directors on Financing Guarantee of the
44 April 25, 2020
Company in 2020
CSCEC: Independent Opinions of Independent Directors on the Concurrent Position
45 of Zheng Xuexuan, Wang Yunlin, Zhao Xiaojiang, Ma Zeping, Zhou Yong and Wang April 25, 2020
Xiangming as Senior Executive of the Controlling Shareholder
CSCEC: Independent Opinions of Independent Directors on the 2019 Profit Distribution
46 April 25, 2020
Plan of the Company

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 SECTION V  IMPORTANT MATTERS
76
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

No. Matter Disclosure Date

CSCEC: Announcement on Resolutions of the 37th Meeting of the Second Session of
47 April 25, 2020
the Board of Directors
CSCEC: Independent Director’s Prior Approval of Opinions on Change of the Company’s
48 April 25, 2020
Auditor for Internal Control in 2020
49 CSCEC: 2019 Annual Financial Statements and Audit Report April 25, 2020
CSCEC: Special Report on Fund Occupation by Controlling Shareholder and Other
50 April 25, 2020
Related Parties
CSCEC: Independent Director’s Prior Approval of Opinions on Proposal in Respect of
51 April 25, 2020
Daily Related Party Transactions of the Company for 2020
CSCEC: Announcement on Resolutions of the 19th Meeting of the Second Session of
52 April 25, 2020
the Board of Supervisors
CSCEC: Independent Opinions of Independent Directors on Change of the Company’s
53 April 25, 2020
Auditor for Internal Control in 2020
54 CSCEC: Announcement on Proposed Additional Financing Guarantee in 2020 April 25, 2020
55 CSCEC: Work Report of Independent Directors in 2019 April 25, 2020
56 CSCEC: Announcement on Significant Project April 25, 2020
57 CSCEC: 2019 Annual Report April 25, 2020
58 CSCEC: Announcement on Change of Auditor for Internal Control April 25, 2020
59 CSCEC: 2019 Internal Control Evaluation Report April 25, 2020
60 CSCEC: Announcement on Profit Distribution for 2019 April 25, 2020
CSCEC: Report on the Performance of Duties of the Audit Committee of the Board of
61 April 25, 2020
Directors for 2019
62 CSCEC: Special Notes and Special Reports on Changes in Accounting Policies for 2019 April 25, 2020
63 CSCEC: Notice of Convening Annual General Meeting of 2019 April 25, 2020
CSCEC: Announcement on Resolutions of the 20th Meeting of the Second Session of
64 April 30, 2020
the Board of Supervisors
65 CSCEC: Report of Q1 2020 April 30, 2020
CSCEC: Announcement on Resolutions of the 38th Meeting of the Second Session of
66 April 30, 2020
the Board of Directors
67 CSCEC: Report of Q1 2020 April 30, 2020
68 CSCEC: Rules of Procedure of the Board of Directors (2020 Revised Draft) May 14, 2020
CSCEC: Announcement on Resolutions of the 39th Meeting of the Second Session of
69 May 14, 2020
the Board of Directors
CSCEC: Announcement on Additional Temporary Proposals at 2019 Annual General
70 May 14, 2020
Meeting
71 CSCEC: Briefings on Business from January to April 2020 May 14, 2020
CSCEC: Announcement on Resolutions of the 21st Meeting of the Second Session of
72 May 14, 2020
the Board of Supervisors
73 CSCEC: Information on 2019 Annual General Meeting May 15, 2020
74 CSCEC: Announcement on Significant Project May 22, 2020
75 CSCEC: Rules of Procedure of the Board of Directors (Revised in May 2020) May 26, 2020
76 CSCEC: Legal Opinions of 2019 Annual General Meeting May 26, 2020
77 CSCEC: Announcement on Resolutions of 2019 Annual General Meeting May 26, 2020
CSCEC: Announcement on Resolutions of the 22nd Meeting of the Second Session of
78 May 29, 2020
the Board of Supervisors
CSCEC: Announcement on Resolutions of the 40th Meeting of the Second Session of
79 May 29, 2020
the Board of Directors
80 CSCEC: Briefings on Business from January to May 2020 June 16, 2020
81 CSCEC: Announcement on Implementing Rights and Interests Distribution for 2019 June 17, 2020
82 CSCEC: Condensed Report on Change in Shareholding June 20, 2020
CSCEC: Holding Announcement on Changes in Equity of Shareholders Holding More
83 June 20, 2020
Than 5%
84 CSCEC: Announcement on Significant Project June 23, 2020

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 SECTION V  IMPORTANT MATTERS
77
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

No. Matter Disclosure Date

85 CSCEC: Briefings on Business from January to June 2020 July 24, 2020
86 CSCEC: Announcement on Significant Project July 25, 2020
CSCEC: Announcement on Investment in Historical Landscape Reservation and Urban
87 July 29, 2020
Renovation Project of Shanghai
CSCEC: Announcement on Resolutions of 41st Meeting of the Second Session of the
88 July 29, 2020
Board of Directors
CSCEC: Announcement on Resolutions of 23rd Meeting of the Second Session of the
89 July 30, 2020
Board of Supervisors
CSCEC: Announcement on Resignation of Supervisors and Nomination of Candidates
90 July 30, 2020
for Supervisors
CSCEC: Announcement on Resolutions of 42nd Meeting of the Second Session of the
91 August 6, 2020
Board of Directors
92 CSCEC: Notice of Convening the 2020 Second Extraordinary General Meeting August 6, 2020
CSCEC: Announcement on Resolutions of 24th Meeting of the Second Session of the
93 August 6, 2020
Board of Supervisors
94 CSCEC: Information of the 2020 Second Extraordinary General Meeting August 14, 2020
95 CSCEC: Briefings on the Business from January to July 2020 August 21, 2020
96 CSCEC: Announcement on Significant Project August 22, 2020
97 CSCEC: Legal Opinions on the 2020 Second Extraordinary General Meeting August 22, 2020
CSCEC: Announcement on Resolutions of the 2020 Second Extraordinary General
98 August 22, 2020
Meeting
CSCEC: Announcement on Resolutions of the 25th Meeting of the Second Session of
99 August 25, 2020
the Board of Supervisors
CSCEC: Announcement on Resolutions of the 26th Meeting of the Second Session of
100 August 28, 2020
the Board of Supervisors
101 CSCEC: 2020 Half-annually Report August 28, 2020
CSCEC: Announcement on Resolutions of the 43rd Meeting of the Second Session of
102 August 28, 2020
the Board of Directors
103 CSCEC: Summary of 2020 Half-annually Report August 28, 2020
CSCEC: Announcement on Participating in the Collective Reception Day for Investors of
104 September 1, 2020
Listed Companies in Beijing in 2020
105 CSCEC: Announcement on Appointment of Vice President of the Company September 12, 2020
CSCEC: Announcement on Resolutions of the 44th Meeting of the Second Session of
106 September 12, 2020
the Board of Directors
CSCEC: Independent Opinions of Independent Directors on Appointment of Shan
107 September 12, 2020
Guangxiu as Vice President of the Company
CSCEC: Announcement on Resolutions of the 45th Meeting of the Second Session of
108 September 18, 2020
the Board of Directors
CSCEC: Announcement on Resolutions of the 27th Meeting of the Second Session of
109 September 18, 2020
the Board of Supervisors
CSCEC: Measures for Implementation, Assessment and Management of Phase IV
110 September 18, 2020
Restricted A Share Incentive Scheme
CSCEC: Announcement on Summary of Phase IV Restricted A Share Incentive Scheme
111 September 18, 2020
(Draft)
CSCEC: Independent Opinions of Independent Directors on the Phase IV Restricted A
112 Share Incentive Scheme (Draft) of China State Construction Engineering Corporation September 18, 2020
Limited
113 CSCEC: Phase IV Restricted A Share Incentive Scheme (Draft) September 18, 2020
114 CSCEC: Briefings on Business from January to August 2020 September 19, 2020
115 CSCEC: Announcement on Significant Project September 29, 2020
116 CSCEC: Announcement on Results of International Credit Rating October 9, 2020
CSCEC: Announcement on Approval of the Phase IV Restricted A Share Incentive
117 Scheme by the State-owned Assets Supervision and Administration Commission of the October 14, 2020
State Council
118 CSCEC: Briefings on Business from January to September 2020 October 23, 2020
CSCEC: Legal Opinions of King & Wood Mallesons on Repurchase of Shares by
119 October 24, 2020
Centralized Bidding Trading of China State Construction Engineering Corporation Limited
120 CSCEC: Announcement on Significant Project October 24, 2020
CSCEC: Repurchase Report on the Repurchase of Shares of the Company through
121 October 24, 2020
Centralized Bidding Trading
CSCEC: Independent Opinions of Independent Directors on Resolutions regarding Share
122 October 24, 2020
Repurchase Proposal by Centralized Bidding Trading

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 SECTION V  IMPORTANT MATTERS
78
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

No. Matter Disclosure Date

CSCEC: Announcement on Resolutions of the 46th Meeting of the Second Session of
123 October 24, 2020
the Board of Directors
CSCEC: Announcement on Resolutions of the 28th Meeting of the Second Session of
124 October 24, 2020
the Board of Supervisors
125 CSCEC: 2020 Report of Q3 October 29, 2020
126 CSCEC: Report of Q3 2020 October 29, 2020
CSCEC: Announcement on the Shareholding of the Top Ten Shareholders and Top Ten
127 October 29, 2020
Shareholders Not Subject to Sales Restrictions
CSCEC: Independent Opinions of Independent Directors on Appointment of Zhang
128 October 29, 2020
Zhaoxiang as the New Director of the Second Session of Board of Directors
CSCEC: Announcement on Resolutions of the 47th Meeting of the Second Session of
129 October 29, 2020
the Board of Directors
CSCEC: Announcement on Resolutions of the 29th Meeting of the Second Session of
130 October 29, 2020
the Board of Supervisors
131 CSCEC: Announcement on First Share Repurchase by Centralized Bidding Trading October 31, 2020
CSCEC: Announcement on the Progress of Repurchase of Shares through Centralized
132 November 4, 2020
Bidding Trading
CSCEC: Announcement on Repurchased Shares of up to 1% in Aggregate and Progress
133 November 7, 2020
of Share Repurchase by Centralized Bidding Trading
CSCEC: Announcement on the Capital Increase in China State Construction Finance
134 Co., Ltd. by the Company and its Controlling Shareholders and Related Party November 10, 2020
Transactions
CSCEC: Opinions of Independent Directors on Prior Approval of the Capital Increase
135 in China State Construction Finance Co., Ltd. by the Company and its Controlling November 10, 2020
Shareholders and Related Party Transactions
CSCEC: Independent Opinions of Independent Directors on the Capital Increase
136 in China State Construction Finance Co., Ltd. by the Company and its Controlling November 10, 2020
Shareholders and Related Party Transactions
CSCEC: Announcement on Resolutions of the 48th Meeting of the Second Session of
137 November 10, 2020
the Board of Directors
CSCEC: Announcement on Resolutions of the 30th Meeting of the Second Session of
138 November 10, 2020
the Board of Supervisors
139 CSCEC: Briefings on Business from January to October 2020 November 18, 2020
CSCEC: Announcement on Resolutions of the 31st Meeting of the Second Session of
140 November 21, 2020
the Board of Supervisors
141 CSCEC: Notice of Convening the 2020 Third Extraordinary General Meeting November 21, 2020
CSCEC: Announcement on the Repurchase of Part of Participants’ Shares under the
142 November 21, 2020
Phase II and III Restricted A Share Incentive Scheme
CSCEC: Legal Opinions on Relevant Matters regarding the Repurchase and Cancellation
143 of Part of Restricted Shares in Respect of Phase II and III Restricted A Share Incentive November 21, 2020
Scheme of China State Construction Engineering Corporation Limited
CSCEC: Announcement on Resolutions of the 49th Meeting of the Second Session of
144 November 21, 2020
the Board of Directors
CSCEC: Independent Opinions of Independent Directors of List of Participants and
145 November 21, 2020
Information on the Grant of Phase IV Restricted A Share Incentive Scheme
CSCEC: Legal Opinions of Phase IV Restricted A Share Incentive Scheme of China
146 November 21, 2020
State Construction Engineering Corporation Limited
147 CSCEC: Announcement on Independent Directors’ Solicitation of Proxy Voting Rights November 21, 2020
148 CSCEC: Announcement on Significant Project November 24, 2020
149 CSCEC: Information of the 2020 Third Extraordinary General Meeting November 28, 2020
CSCEC: Announcement on Resolutions of the 32nd Meeting of the Second Session of
150 December 2, 2020
the Board of Supervisors
CSCEC: Explanation on the Result of Review by the Board of Supervisors and the
151 December 2, 2020
Publication of the List of Participants of the Company’s Phase IV Restricted A Shares
CSCEC: Announcement the Progress of Repurchase of Shares through Centralized
152 December 3, 2020
Bidding Trading
CSCEC: Announcement on Repurchased Shares of up to 2% in Aggregate of Share
153 December 3, 2020
Repurchase by Centralized Bidding Trading
CSCEC: Legal Opinions of King & Wood Mallesons on the 2020 Third Extraordinary
154 December 8, 2020
General Meeting of China State Construction Engineering Corporation Limited
155 CSCEC: Measures on the Management of Provision of Security to Third Parties (Trial) December 8, 2020
156 CSCEC: Measures on Raised Funds Management (Revision in December 2020) December 8, 2020
CSCEC: Announcement on Decrease in Registered Capital of the Company after
157 Repurchase and Cancellation of Part of Phases II and III Restricted Shares and Notice to December 8, 2020
Creditors
CSCEC: Self-examination Report on the Trading of Shares of the Company by Persons
158 December 8, 2020
with Inside Information Related to Phase IV Restricted A Share Incentive Scheme
159 CSCEC: Announcement on Resolutions of the 2020 Third Extraordinary General Meeting December 8, 2020

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 SECTION V  IMPORTANT MATTERS
79
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

No. Matter Disclosure Date

CSCEC: Announcement on the Implementation Results of Share Repurchase and
160 December 15, 2020
Changes in Shares
161 CSCEC: Briefings on Business from January to November 2020 December 18, 2020
162 CSCEC: Announcement on Changes in Accounting Policies December 24, 2020
CSCEC: Announcement on Resolutions of the 50th Meeting of the Second Session of
163 December 24, 2020
the Board of Directors
CSCEC: Announcement on Resolutions of the 33rd Meeting of the Second Session of
164 December 24, 2020
the Board of Supervisors
CSCEC: Independent Opinions of Independent Directors on Granting under Phase IV
165 December 24, 2020
Restricted A Share Incentive Scheme
166 CSCEC: List of Participants (2,765) of Phase IV Restricted A Share Incentive Scheme December 24, 2020
CSCEC: Legal Opinions of King & Wood Mallesons on Matters of Granting under Phase
167 IV Restricted A Share Incentive Scheme of China State Construction Engineering December 24, 2020
Corporation Limited
CSCEC: Announcement on Granting under Phase IV Restricted A Share Incentive
168 December 24, 2020
Scheme
CSCEC: Independent Opinions of Independent Directors on Adopting New Lease
169 December 24, 2020
Standards
170 CSCEC: Announcement on Significant Project December 26, 2020
CSCEC: Opinions of Independent Directors on Prior Approval of Renewal of Financial
171 Service Framework Agreement between China State Construction Finance Co., Ltd. and December 30, 2020
China State Construction Engineering Corporation
CSCEC: Announcement on Resolutions of the 51st Meeting of the Second Session of
172 December 30, 2020
the Board of Directors
CSCEC: Independent Opinions of Independent Directors on First Tranche of Unlocking
173 December 30, 2020
in 2020 under the Phase III Restricted A Share Incentive Scheme
174 CSCEC: Notice of Convening the 2021First Extraordinary General Meeting December 30, 2020
CSCEC: Announcement on Renewal of the Financial Services Framework Agreement
175 between China State Construction Finance Co., Ltd. and China State Construction December 30, 2020
Engineering Corporation and Daily Related Party Transaction
CSCEC: Announcement on Resolutions of the 34th Meeting of the Second Session of
176 December 30, 2020
the Board of Supervisors
CSCEC: Opinions of Independent Directors on Prior Approval of Renewal of
177 Comprehensive Services Framework Agreement between the Company and China State December 30, 2020
Construction Engineering Corporation
CSCEC: Announcement on Provision of Entrusted Loans to the Company by its
178 December 30, 2020
Controlling Shareholder and Related Party Transaction
CSCEC: Independent Opinions of Independent Directors on Renewal of the Financial
179 Services Framework Agreement between China State Construction Finance Co., Ltd. December 30, 2020
and China State Construction Engineering Corporation
CSCEC: Announcement on the Repurchase of Part of Participants’ Shares under the
180 December 30, 2020
Phase II and III Restricted A Share Incentive Scheme
CSCEC: Independent Opinions of Independent Directors on Provision of Entrusted
181 December 30, 2020
Loans to the Company by China State Construction Engineering Corporation
CSCEC: Opinions of Independent Directors on Prior Approval of Provision of Entrusted
182 December 30, 2020
Loans to the Company by China State Construction Engineering Corporation
CSCEC: Legal Opinions of King & Wood Mallesons on Relevant Matters regarding
the Repurchase and Cancellation of Part of Restricted Shares in Respect of Phase II
183 December 30, 2020
and III Restricted A Share Incentive Scheme of China State Construction Engineering
Corporation Limited
CSCEC: Announcement on Renewal of Comprehensive Services Framework Agreement
184 between the Company and China State Construction Engineering Corporation and Daily December 30, 2020
Related Party Transaction
CSCEC: Independent Opinions of Independent Directors on Third Tranche of Unlocking
185 December 30, 2020
in 2020 under the Phase II Restricted A Share Incentive Scheme
CSCEC: Independent Opinions of Independent Directors on Renewal of Comprehensive
186 Services Framework Agreement between the Company and China State Construction December 30, 2020
Engineering Corporation
187 CSCEC: Information of 2021 First Extraordinary General Meeting December 31, 2020

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 80
SECTION VI  CHANGES IN ORDINARY SHARES AND SHAREHOLDERS
I. Changes in Ordinary Share Capital

BAR21010002_E_CSCEC 2020AR()_.indb 80
(I) Table of changes in ordinary shares

1. Table of changes in ordinary shares

As of the end of the Reporting Period, the changes in the Company’s share capital structure are as follows:

Unit: Share
Before the change Increase/decrease upon the change (+,-) After the change
Percentage Issue of Conversion Percentage
Number Bonus issue Others Subtotal Number
(%) new shares from reserve (%)
I. Shares subject to trading moratorium 834,554,667 1.99 -123,086,000 -123,086,000 711,468,667 1.70
1. State-owned shares
2. State-owned legal person shares
3. Other domestic shares 834,554,667 1.99 -123,086,000 -123,086,000 711,468,667 1.70
Including: Shares held by domestic
      non-state-owned legal persons
Shares held by domestic
834,554,667 1.99 -123,086,000 -123,086,000 711,468,667 1.70
  natural persons
4. Shares held by foreign entities
Including: Shares held by overseas legal
      persons
SECTION VI  CHANGES IN ORDINARY SHARES AND SHAREHOLDERS
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Shares held by overseas

  natural persons
II. Circulating shares not subject to trading
41,141,075,044 98.01 112,527,800 112,527,800 41,253,602,844 98.30
  moratorium
1. RMB ordinary shares 41,141,075,044 98.01 112,527,800 112,527,800 41,253,602,844 98.30
2. Domestic listed foreign shares
3. Overseas listed foreign shares
4. Others
III. Total number of ordinary shares 41,975,629,711 100.00 -10,558,200 -10,558,200 41,965,071,511 100.00

2021/5/21 13:19:49
 SECTION VI  CHANGES IN ORDINARY SHARES AND SHAREHOLDERS
81
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

2. Explanation on changes in ordinary shares

√ Applicable   N/A

As of the end of the Reporting Period, there were two changes in the Company’s shares, which were
caused by the Company’s unlocking of restricted shares, repurchase and cancellation of some restricted
shares. The details are as follows:

(1) The Company completed the unlocking of the second tranche of 112,527,800 restricted shares
under the Phase II restricted A share incentive scheme, converting circulating restricted shares
subject to trading moratorium to circulating shares not subject to trading moratorium. The total
share capital of the Company amounted to 41,975,629,711 shares. For details, please refer to the
Announcement on the Second Tranche of Unlocking in 2019 in respect of Phase II Restricted A
Share Incentive Scheme and Listing of Shares of the Company published on February 5, 2020.

(2) The Company completed the repurchase from the participants and cancellation of 10,558,200
restricted shares that were not eligible for unlocking. After the completion of the repurchase
and cancellation, the registered capital (and share capital) of the Company was decreased by
RMB10,558,200 (and 10,558,200 shares) to RMB41,965,071,511 (and 41,965,071,511 shares). For
details, please refer to the Announcement on Implementation of Repurchase for Cancellation of
Part of Restricted Shares under the Equity Incentive Scheme published on April 13, 2020.

3. The impact, if any, of changes in ordinary shares on financial indicators such as earnings
per share, net asset per share for the latest year and the latest period
 Applicable  √ N/A

4. Other disclosures that the Company deemed necessary or were required by securities
regulatory authorities
 Applicable  √ N/A

(II) Changes in shares subject to trading moratorium

√ Applicable   N/A

Unit: Share
Number of Number of
Number of Number of new
shares subject shares subject
shares released shares subject Reason for Date of release
to trading to trading
Name of Shareholder from trading to trading the trading from trading
moratorium at moratorium at
moratorium for moratorium for moratorium moratorium
the beginning the end
the year the year
of the year of the year
During the
Participants of Restricted Stock trading
834,554,667 -123,086,000 0 711,468,667 /
Incentive Plan moratorium
period
Total 834,554,667 -123,086,000 0 711,468,667 / /

For details, please refer to the above “Explanation on changes in ordinary shares”.

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 SECTION VI  CHANGES IN ORDINARY SHARES AND SHAREHOLDERS
82
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

II. Issuance and Listing of Securities

(I) Issue of securities during the Reporting Period

√ Applicable   N/A

Unit: 100 million shares  Currency: RMB

Number of
Shares
Types of shares and their Issue price Number of Ending date
Date of issue Date of listing permitted
derivative securities (or interest rate) shares issued of the trading
to be listed
for trading
Ordinary Shares
RMB Ordinary Shares (A Shares) July 22, 2009 4.18 120 July 29, 2009 120 /
Convertible corporate bonds, convertible bonds with detachable warrants and corporate bonds
/ / / / / / /
Other derivative securities
Preferred Shares March 2, 2015 100 1.5 March 20, 2015 1.5 March 2, 2020

Issue of securities during the Reporting Period (please provide separately the particulars of bonds with different
interest rates for duration):

√ Applicable   N/A

For the issuance of the Company’s preferred shares, please refer to the relevant information as set out under
Section VII “INFORMATION RELATED TO PREFERRED SHARES” hereof.

(II) Changes in the Company’s total number of ordinary shares and structure of shareholders and
changes in structure of asset and liability of the Company
 Applicable  √ N/A

(III) Existing internal employee shares

 Applicable  √ N/A

III. Shareholders and De Facto Controller

(I) Total number of shareholders

Total number of ordinary shareholders as of the end of the Reporting Period 557,337
Total number of ordinary shareholders at the end of the month immediately
546,613
  before the date of disclosure of the Annual Report
Total number of preferred shareholders with voting rights restored as of the end of
N/A
  the Reporting Period
Total number of preferred shareholders with voting rights restored at the end
N/A
  of the month immediately before the date of disclosure of the Annual Report

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 SECTION VI  CHANGES IN ORDINARY SHARES AND SHAREHOLDERS
83
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(II) Shareholding of top ten shareholders, top ten shareholders of circulating shares (or holders
of shares not subject to trading moratorium) as of the end of the Reporting Period
Unit: Share
Shareholding of top ten shareholders
Number of
Increase/decrease Number of shares shares held Pledged or frozen
Percentage Nature of
Name of shareholder (full name) during the held at the end subject to
(%) shareholder
Reporting Period of the period trading Status Number
moratorium
State-owned
China State Construction Engineering Corporation 0 23,630,695,997 56.31 0 Nil 0
legal person
China Securities Finance Corporation Limited 0 1,258,300,998 3.00 0 Nil 0 Other
Hong Kong Securities Clearing Company Limited 283,205,279 1,149,124,426 2.74 0 Nil 0 Other
Special account for securities repurchase of China
State Construction Engineering Corporation 912,036,000 912,036,000 2.17 0 Nil 0 Other
Limited
State-owned
Central Huijin Asset Management Co., Ltd. 0 596,022,420 1.42 0 Nil 0
legal person
Foreign legal
GIC PRIVATE LIMITED -71,927,024 215,721,132 0.51 0 Nil 0
person
Industrial & Commercial Bank of China – SSE
Securities
Index 50 Trading Open-end Index Securities -5,532,229 156,169,063 0.37 0 Nil 0
investment fund
Investment Fund
Bank of Communications – E Fund 50 Index Securities
-33,000,000 136,642,126 0.33 0 Nil 0
Securities Investment Fund investment fund
Portfolio 106 of the National Social Security Fund 135,394,213 135,394,213 0.32 0 Nil 0 Other
Shanghai Pudong Development Bank Co., Ltd.
– Guangfa High-end Manufacturing Equity Securities
113,552,899 113,552,899 0.27 0 Nil 0
Initiative Securities Investment Fund* (广发高端 investment fund
制造股票型发起式证券投资基金)

Shareholdings of the top ten holders of circulating shares not subject to trading moratorium
Number of circulating Class and number of shares
Name of shareholder shares not subject to
trading moratorium Class Number
China State Construction Engineering Corporation 23,630,695,997 RMB ordinary shares 23,630,695,997
China Securities Finance Corporation Limited 1,258,300,998 RMB ordinary shares 1,258,300,998
Hong Kong Securities Clearing Company Limited 1,149,124,426 RMB ordinary shares 1,149,124,426
Special account for securities repurchase of China State Construction
912,036,000 RMB ordinary shares 912,036,000
Engineering Corporation Limited
Central Huijin Asset Management Co., Ltd. 596,022,420 RMB ordinary shares 596,022,420
GIC PRIVATE LIMITED 215,721,132 RMB ordinary shares 215,721,132
Industrial & Commercial Bank of China – SSE Index 50 Trading Open-end
156,169,063 RMB ordinary shares 156,169,063
Index Securities Investment Fund
Bank of Communications – E Fund 50 Index Securities Investment Fund 136,642,126 RMB ordinary shares 136,642,126
Portfolio 106 of the National Social Security Fund 135,394,213 RMB ordinary shares 135,394,213
Shanghai Pudong Development Bank Co., Ltd. - Guangfa High-end
Manufacturing Equity Initiative Securities Investment Fund* (广发高端制 113,552,899 RMB ordinary shares 113,552,899
造股票型发起式证券投资基金)
There is no related relationship or action in concert between China State
Construction Engineering Corporation, the largest shareholder of the Company,
Descriptions on the related relationship or acts in concert of the
and any other shareholder mentioned above. The Company is not aware of any
  above shareholders
related relationship among the above shareholders, or whether they are parties
acting in concert.
Descriptions on the preferred shareholders with voting rights restored and
N/A
  number of shares held

Number of shares held by top ten holders of shares subject to trading moratorium and trading moratorium
 Applicable  √ N/A
Please refer to the relevant content of “(II) Changes in Shares Subject to Trading Moratorium” under “I. Changes in
Ordinary Share Capital” in this Section.

(III) Strategic investors or general legal persons becoming the top 10 shareholders as a result of
new share placement
 Applicable  √ N/A

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 SECTION VI  CHANGES IN ORDINARY SHARES AND SHAREHOLDERS
84
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

IV. Controlling Shareholder and De Facto Controller

(I) Controlling shareholder

1. Legal person
√ Applicable   N/A

Name China State Construction Engineering Corporation

Person in charge
of the company
Zhou Naixiang
or legal
representative
It was established on June 11, 1982 following the official announcement of the
former Ministry of Urban and Rural Construction and Environmental Protection,
and the former State Administration for Industry and Commerce issued a
Date of
business license to China State Construction Engineering Corporation on March
establishment
25, 1983. It was transformed to a wholly state-owned company on November
28, 2017, and changed its name to China State Construction Engineering
Corporation.
The operation of state-owned assets within the scope authorized by the State
Council; undertaking of survey, design, construction, installation and consultation
of civil and constructional engineering at home and abroad; operation of real
estate; decoration works; sculpture and frescoes business; undertaking of foreign
economic assistance projects of the state; contracting of foreign-related projects
in the PRC, organization of non-trade enterprises overseas, carrying out of labor
service cooperation in the PRC using foreign resources, funds and technology,
and export business of equipment and materials required for foreign projects;
production and operation of construction materials and other non-metallic
mineral products, metal products for construction, tools, construction engineering
Principal activities
machinery and drilling machinery; import and export of goods, import and export
of technology, agent service for import and export; project investment; real estate
development; engineering survey and design; construction project management;
technical consulting, technical services; property management. (Enterprises
may independently choose business items and carry out business activities in
accordance with the law; as for items subject to approval in accordance with
the law, relevant business activities shall be carried out with the approval of the
competent authorities and within the scope of the approval; business activities
of the forbidden and restricted projects as required by the municipal industry
policies are not allowed.)
Shareholding
and equity
China State Construction Engineering Corporation holds 27.05% shares of
participation in
CSCEC Scimee Sci. & Tech. Co., Ltd. (stock abbreviation: SCIMEE, stock code:
other domestic
300425.SZ) through its wholly-owned subsidiary, Beijing Zhongjian Qiming
and overseas
Enterprise Management Co., Ltd. (北京中建启明企业管理有限公司) (“Zhongjian
listed companies
Qiming”). Zhongjian Qiming is the controlling shareholder of SCIMEE.
during the
Reporting Period
Other matters /

2. Natural person
 Applicable  √ N/A

3. Special explanation on absence of a controlling shareholder of the Company

 Applicable  √ N/A

4. Details of the index and the date of changes of the controlling shareholder during the
Reporting Period
 Applicable  √ N/A

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

5. Chart showing the ownership and controlling relationship between the Company and the
controlling shareholder
√ Applicable   N/A

China State Construction

Engineering Corporation

56.31%

China State Construction

Engineering Corporation Limited

(II) De Facto Controller

1. Legal person
√ Applicable   N/A

Name State-owned Assets Supervision and Administration Commission of the State Council

2. Natural person
 Applicable  √ N/A

3. Special explanation on absence of a de facto controller of the Company

 Applicable  √ N/A

4. Details of the index and the date of changes of the de facto controller during the
Reporting Period
 Applicable  √ N/A

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

5. Chart showing the ownership and controlling relationship between the Company and the
de facto controller
√ Applicable   N/A

SASAC of the State Council

100%

China State Construction

Engineering Corporation

56.31%

China State Construction

Engineering Corporation Limited

6. The de facto controller controlling the Company through a trust or other asset
management company
 Applicable  √ N/A

(III) Other information of the controlling shareholder and the de facto controller
 Applicable  √ N/A

V. Other Corporate Shareholders Holding More than 10% of the Shares

 Applicable  √ N/A

VI. Explanation on Restrictions on the Reduction of Shareholding

 Applicable  √ N/A

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

SECTION VII  INFORMATION RELATED TO PREFERRED SHARES

√ Applicable   N/A

I. Issuance and Listing of Preferred Shares in the Past Three Years as of the End of the
Reporting Period
Unit: ten thousand shares
Number
Abbreviation of shares
Code of Issue price Dividend rate Number of
of preferred Date of issue Date of listing permitted to Delisting date
preferred shares (in RMB) (%) shares issued
shares be listed for
trading
China
Construction March 2, March 20, March 2,
360007 100 5.8% 15,000 15,000
Preferred 2015 2015 2020
Stock 1
On March 6, 2015, upon consideration and approval at the 76th meeting of the first session of the Board of the Company, it
was agreed to replace the self-pooled upfront investment in projects to be invested through fund raising with the proceeds
from preferred shares of RMB12.763 billion. The Company’s independent directors and the Board of Supervisors agreed
on the matter. For details of and investment in the projects, please refer to the relevant announcements such as CSCEC:
Announcement on the Replacement of the Self-Pooled Upfront Investment in Projects to be Invested Through Fund Raising
Use progress and
with the Proceeds from Preferred Shares issued by the Company on March 10, 2015. In accordance with the commitment
  changes of proceeds
made in the application document for the issuance of preferred shares, the remaining proceeds from preferred shares of
RMB2.212 billion were used for the category III of projects, i. e. supplementing the Company’s general working capital.
As of the end of the Reporting Period, all the proceeds from the Company’s initial non-public issuance of preferred shares of
RMB15.0 billion have been fully utilized. Please refer to the relevant content of (a) “Preferred share” under Note V. 43 “Other
equity instruments” to the Financial Statements under Section XI “FINANCIAL REPORT” hereof.

II. Preferred Shareholders

(I) Total number of preferred shareholders

Total number of preferred shareholders as of the end of the Reporting Period 0
Total number of preferred shareholders at the end of the month immediately
0
  before the date of disclosure of the Annual Report

(II) Other matters

√ Applicable   N/A
The Proposal on Relevant Matters Regarding the Redemption of 150,000,000 Unlisted Preferred Shares of China
State Construction Engineering Corporation Limited was considered and approved at the 34th meeting of the
second session of Board of Directors of the Company on February 3, 2020; the Proposal on Relevant Matters
Regarding the Redemption of 150,000,000 Unlisted Preferred Shares of China State Construction Engineering
Corporation Limited, the Proposal on Amendments to the Articles of Association of China State Construction
Engineering Corporation Limited and the Proposal on Amending the Rules of Procedure of the General Meeting of
China State Construction Engineering Corporation Limited were considered and approved at the Company's first
extraordinary general meeting in 2020 on February 19, 2020. The Company redeemed all preferred shares held by
all the preferred shareholders of the Company on March 2, 2020.

III. Profit Distribution of Preferred Shares

(I) Profit distribution

√ Applicable   N/A
According to the Articles of Association of the Company, the Company pays dividends in cash once a year, which
will carry fixed dividend rate with single step-up in dividend rate arrangement. For the preferred shares issued in
the first tranche, the dividend rate for the first five dividend accruing years has been determined at 5.80% through
inquiry methods, and remained unchanged. If the Company does not exercise its redemption rights entirely, from
the sixth dividend accruing year onwards, the dividend rate per share will be the dividend rate for the first five
dividend accruing years plus 2 percentage points, and will remain unchanged after adjustments to the dividend
rate for the sixth dividend accruing year. The preferred shares issued in different tranches will have equal priority to
dividend distribution. The Company may distribute dividends to the preferred shareholders if there are distributable
profit left after recovering losses and making allocations to its reserve according to relevant laws. The dividends
on the preferred shares are not cumulative. Unless the occurrence of any trigger events for compulsory payment,
the general meeting of the Company shall be entitled to determine to cancel the payment of part or full current
dividend on the preferred shares. Once the preferred shareholders under the issuance have received dividends at
the specified dividend rate, they shall not be entitled to the distribution of the remaining profit together with ordinary
shareholders.

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Please refer to the Articles of Association, the Prospectus for the Non-public Issuance of Preferred Shares
of CSCEC, Report on the Issuance of Non-public Issuance of Preferred Shares of CSCEC and other related
announcements published by the Company on March 7, 2015, as well as the relevant content of (a) “Preferred
Share” under Note V. 43 “Other equity instruments” to the Financial Statements under Section XI “FINANCIAL
REPORT” hereof.

(II) Distribution amount and distribution ratio for preferred shares in the recent three years (the
Reporting Period inclusive)
√ Applicable   N/A

Unit: ’000 yuan  Currency: RMB

Distribution amount Distribution ratio
2019-2020 870,000 Dividend rate of 5.80%
2018-2019 870,000 Dividend rate of 5.80%
2017-2018 870,000 Dividend rate of 5.80%

Other explanation:

On April 11, 2019 and May 7, 2019, the 23rd meeting of the second session of the Board of the Company and
the 2018 annual general meeting considered and approved the Proposal on the Dividend Distribution Plan in
2019-2020 for Preferred Shares of RMB15.0 billion of China State Construction Engineering Corporation Limited,
a cash dividend of RMB5.80 (tax inclusive) per preferred share will be distributed to the preferred shareholders
(tranche I) whose names appear on the register of members of the Company, as maintained by China Securities
Depository and Clearing Corporation Limited, Shanghai Branch, after the close of trading hours of the Shanghai
Stock Exchange on February 28, 2020, based on the 150 million preferred shares (tranche I) which were issued
at a dividend rate of 5.80%. For details, please refer to the Announcement on Distribution of Dividends for
Preferred Shares (Tranche I) of 2019-2020 issued on February 22, 2020. As of March 2, 2020, the plan has been
implemented.

(III) If the Company records profits and the parent company records a positive undistributed profit
during the Reporting Period but no profit is distributed for preferred shares, the Company
shall disclose the reasons and the usage of the undistributed profits and the usage plan in
details
 Applicable  √ N/A

(IV) Other explanation

 Applicable  √ N/A

IV. Repurchase and Conversion of the Company’s Preferred Shares during the Reporting
Period

(I) Repurchase
√ Applicable   N/A
Number
Total
of shares Subjects to Impact on the
Code of Abbreviation Repurchase funds for
Date of repurchased Proportion Source of Term of share exercising share capital
preferred of preferred price (RMB Pricing principle repurchase
repurchase (ten (%) funds repurchase repurchase structure of the
shares shares per share) (in RMB100
thousand option Company
million)
shares)
Par value of preferred
Ordinary shares
China shares plus dividends
are not affected,
Construction resolved to be paid Self-
360007 March 2, 2020 100 15,000 100 150 March 2, 2020 CSCEC and the number
Preferred but not yet paid in finance
of preferred
Stock 1 the current period
shares is nil
(RMB5.80 per share)

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Explanation on matters such as the procedure for considering the repurchase of preferred
shares
As approved at the Company's first extraordinary meeting in 2020 on February 19, 2020, the redemption and
cancellation of all the issued 150,000,000 preferred shares of China Construction Preferred Stock 1 was completed
on March 2, 2020. For details, please refer to relevant announcements of the Company:

1. The Proposal on Relevant Matters Regarding the Redemption of 150,000,000 Unlisted Preferred Shares
of China State Construction Engineering Corporation Limited was considered and approved at the 34th
meeting of the second session of the Board and the 18th meeting of the second session of Board of
Supervisors on February 3, 2020;

2. The Company issued the First Holding Announcement on Redemption of Unlisted Preferred Shares on
February 4, 2020;

3. The Proposal on Relevant Matters Regarding the Redemption of 150,000,000 Unlisted Preferred Shares of
China State Construction Engineering Corporation Limited was considered and approved at the 2020 first
extraordinary general meeting of the Company on February 19, 2020;

4. The Company issued the Second Holding Announcement on Redemption of Unlisted Preferred Shares on
February 20, 2020;

5. The Company issued the Third Holding Announcement on Redemption of Unlisted Preferred Shares on
February 21, 2020;

6. The Company issued the Announcement on Redemption and Delisting of All Unlisted Preferred Shares and
the Holding Announcement on the Suspension of Trading of Unlisted Preferred Shares on February 26,
2020;

7. The Company issued the Announcement on Results of the Redemption of All Unlisted Preferred Shares on
March 4, 2020.

(II) Conversion
 Applicable  √ N/A

No terms for compulsory conversion to ordinary shares are provided in China Construction Preferred Stock 1.

V. Restoration and Exercise of Relevant Voting Rights that the Company shall Disclose If the
Voting Rights of Preferred Shares Restored

 Applicable  √ N/A

VI. Accounting Policies Adopted by the Company for Preferred Shares and Reasons Therefor

√ Applicable   N/A

Pursuant to the requirements of Accounting Standard for Business Enterprises No. 37 – Presentation of Financial
Instruments and Provisions for Differentiation between Financial Instruments and Equity Instruments and Relevant
Accounting Treatment issued by the Ministry of Finance, the actual amount received from total issuance amount of China
Construction Preferred Stock 1 net of related transaction costs was accounted for as other equity instruments.

VII. Miscellaneous

 Applicable  √ N/A

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SECTION VIII  DIRECTORS, SUPERVISORS, SENIOR

MANAGEMENT AND EMPLOYEES
I. Changes in Shareholding and Remuneration

(I) Changes in shareholding and remuneration of incumbent and resigned directors, supervisors
and senior management during the Reporting Period
√ Applicable   N/A
Unit: 0,000 shares
Total pre-tax
Number of remuneration Whether to obtain
Commencement Number of
Expiry date of the shares hold at the Share changes Reason for received from the remuneration from
Name Position Gender Age date of the term shares hold at the
term of office beginning during the year changes Company during related parties
of office end of the year
of the year the Reporting of the Company
Period (0’000 yuan)
Incumbent directors, supervisors and senior management
Zhou Naixiang Chairman Male 59 October 10, 2019 January 8, 2021 0 0 0 / / Yes
Director Male 54 May 7, 2019 January 8, 2021
Upon a new
Zheng Xuexuan appointment/ 50.4 50.4 0 / / Yes
President Male 54 March 4, 2020
dismissal by the
Board of Directors
Zhang
Director Male 57 December 7, 2020 January 8, 2021 0 0 0 / / Yes
Zhaoxiang
Independent
Yang Chunjin Male 70 January 9, 2018 January 8, 2021 0 0 0 / 6 No
director
Independent
Yu Hailong Male 70 January 9, 2018 January 8, 2021 0 0 0 / 6 No
director
Independent
Jia Chen Male 65 January 9, 2018 January 8, 2021 0 0 0 / 6 No
director
Zheng Independent
Male 65 January 9, 2018 January 8, 2021 0 0 0 / 6 No
Changhong director
Chairman of
Shi Zhiping the Board of Male 57 August 21, 2020 January 8, 2021 83.7 83.7 0 / 142.76 No
Supervisors
Li Jianbo Supervisor Male 63 January 9, 2018 January 8, 2021 44.8 44.8 0 / 6 No
Tian Shifang Supervisor Male 63 January 9, 2018 January 8, 2021 15.4 15.4 0 6 No
Employee
Ning Wangchu representative Male 63 January 9, 2018 January 8, 2021 22.12 22.12 0 6 No
supervisor
Employee
Lu Yanbin representative Male 63 January 9, 2018 January 8, 2021 15.4 15.4 0 / 6 No
supervisor

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Unit: 0,000 shares

Total pre-tax
Number of remuneration Whether to obtain
Commencement Number of
Expiry date of the shares hold at the Share changes Reason for received from the remuneration from
Name Position Gender Age date of the term shares hold at the
term of office beginning during the year changes Company during related parties
of office end of the year
of the year the Reporting of the Company
Period (0’000 yuan)
Upon a new
Vice president,
appointment/
Wang Yunlin chief financial Male 57 January 15, 2019 0 0 0 / / Yes
dismissal by the
officer
Board of Directors
Upon a new
appointment/
Zhao Xiaojiang Vice president Male 55 January 19, 2016 0 0 0 / / Yes
dismissal by the
Board of Directors
Upon a new
appointment/
Ma Zeping Vice president Male 58 December 1, 2010 50.4 50.4 0 / / Yes
dismissal by the
Board of Directors
Upon a new
appointment/
Zhou Yong Vice president Male 50 January 28, 2019 83.7 83.7 0 / / Yes
dismissal by the
Board of Directors
Upon a new
appointment/
Shan Guangxiu Vice president Female 50 September 11, 2020 122.046 122.046 0 / 78.01Note 2 Yes
dismissal by the
Board of Directors
Upon a new
appointment/
Huang Kesi Vice president Male 60 October 27, 2017 134.716 134.716 0 / 121.43 No
dismissal by the
Board of Directors
Upon a new
Secretary to the appointment/
Xue Keqing Male 57 June 15, 2018 129.9 129.9 0 / 119.83 No
board dismissal by the
Board of Directors
Resigned directors, supervisors and senior management
Former chairman
Gao Lieyang of the Board of Male 55 January 9, 2018 July 29, 2020 16.8 16.8 0 / 101.66 No
Supervisors
Total / / / / / 769.382 769.382 0 / 611.69 /

Note 1: The terms of office of the second session of both the Board of Directors and Board of Supervisors have been expired on
January 8, 2021. As the nomination and election of candidates for the new sessions of Board of Directors and Board of
Supervisors of the Company have not yet been finished, the term of office of the second sessions of the Board and Board
of Supervisors, as well as the special committees under the Board of Directors have been extended correspondingly. The
Company will complete the election of directors and supervisors as practicable as possible and perform relevant information
disclosure obligations in a timely manner. The election of directors and supervisors for new session of the Board of
Directors and Board of Supervisors will not affect the normal operation of the Company.

Note 2: The total remuneration before tax obtained before being nominated as a leader of China State Construction Engineering
Corporation.

Note 3: Considering the appointment and dismissal of the leadership of China State Construction Engineering Corporation by the
Organization Department of the CPC Central Committee and the SASAC of the State Council, remuneration of the leaders
of China State Construction Engineering Corporation will be paid by China State Construction Engineering Corporation and
disclosed on the Company’s official website. Leaders who work part-time in CSCEC have been approved by the CSRC.

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Name Major work experience

Party Secretary and Chairman of China State Construction Engineering Corporation,
Chairman of China State Construction Engineering Corporation Limited. Senior engineer, a
master’s degree holder. Former deputy general manager of Jiangsu Provincial Construction
Engineering Corporation (Construction Group Corporation), deputy mayor of Taizhou City,
Jiangsu Province, standing committee member and executive deputy mayor of Taizhou
City, Jiangsu Province, director and Party Secretary of Jiangsu Tourism Bureau, and
Party Secretary, deputy director of Jiangsu Provincial Department of Housing and Urban-
Rural Development, deputy secretary, acting mayor and mayor of Suzhou Municipal Party
Zhou Naixiang
Committee of Jiangsu Province, secretary of Suzhou Municipal Party Committee of Jiangsu
Province, member of the Standing Committee of Jiangsu Provincial Party Committee and
secretary of the Suzhou Municipal Party Committee. He has been the Party Secretary of
China State Construction Engineering Corporation since August 2019, Chairman of China
State Construction Engineering Corporation Since September 2019, and Chairman of
China State Construction Engineering Corporation Limited since October 2019. He is a
representative of the 19th NPC, alternate member of the 19th Central Committee of the
Communist Party of China, and representative of the 12th National People’s Congress.
Director, general manager, deputy secretary of the Party Committee of China State
Construction Engineering Corporation, director and president of China State Construction
Engineering Corporation Limited, professor-level senior engineer and PhD holder. He
has served as deputy general manager and general manager of Manager Department
of CSCEC Algeria, chairman, and Party Committee secretary of CSCEC Algeria; deputy
general manager of Overseas Cooperation Division of CSCEC; executive director and Party
Committee member of CSCEC International Operations; executive general manager of
Overseas Business Department of CSCEC; assistant general manager and general manager
of Human Resources Department of China Construction Engineering Corporation Limited.
Zheng Xuexuan Since November 2015, he has been a member of the Party Committee of the former China
State Construction Engineering Corporation. He has been the deputy general manager
of China State Construction Engineering Corporation Limited since January 2016, the
deputy general manager of the former China State Construction Engineering Corporation
from January 2017, director and deputy secretary of the Party Committee of China State
Construction Engineering Corporation since September 2018, director of China State
Construction Engineering Corporation Limited since May 2019, general manager of China
State Construction Engineering Corporation since November 2019, and president of China
State Construction Engineering Corporation Limited since March 2020. Representative of the
17th National People’s Congress of the Communist Party of China, National Model Worker.
Director, deputy secretary of the Party Committee of China State Construction Engineering
Corporation, director of China State Construction Engineering Corporation Limited, professor-
level senior engineer and Master’s degree holder. He successively served as vice president,
president and secretary of the Party Committee of China Nonferrous Engineering and
Research Institute (中国有色工程设计研究总院), chairman of the board and general manager
of China ENFI Engineering Corporation (中国恩菲工程技术有限公司), president, vice
Zhang chairman and secretary of the Party Committee of Metallurgical Corporation of China Ltd.,
Zhaoxiang standing committee member of the Party Committee, general manager, deputy secretary
of the Party Committee, director, general manager and secretary of the Party Committee
of China Metallurgical Group Corporation, deputy general manager and member of the
party group of China Minmetals Corporation. He has been a deputy secretary of the Party
Committee of China State Construction Engineering Corporation since July 2020, a director
of China State Construction Engineering Corporation since August 2020 and a director of
China State Construction Engineering Corporation Limited since December 2020.
Independent director of China State Construction Engineering Corporation Limited,
professor-level senior engineer, enjoying special government subsidy from the State Council,
a bachelor’s degree holder. He has been the deputy director of the cadre department of the
Ministry of Water and Electricity since October 1986, the director of the personnel and labor
department of the Ministry of Water Resources since June 1988, the deputy director of the
Yang Chunjin personnel and labor department of the Ministry of Water Resources since July 1992, general
manager and party secretary of Jianghe Water Conservancy and Hydropower Development
Company (中国江河水利水电开发公司) since September 1995, general manager and
party secretary of China Water Conservancy Investment Group Co., Ltd. since June 2001,
and deputy general manager and member of the Party Committee of China Three Gorges
Corporation since March 2009.

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Name Major work experience

Independent director of China State Construction Engineering Corporation Limited,
professor-level senior engineer and holder of master in engineering management. Mr.
Yu served as deputy director of the Personnel Bureau of the State Economic and Trade
Commission (国家经委人事局) since February 1983, director of the office and the project
investigation department of China Kangfu International Leasing Co., Ltd. under the Ministry
of Foreign Trade and Economic Cooperation (国家外经贸部中国康富国际租赁公司) since
February 1988, and deputy director of the General Office (in charge of work) of Machinery
and Electric Qingfang Investment Co., Ltd. under the State Planning Commission (国家计
委机电轻纺投资公司) since June 1992. Mr. Yu served as director of the office and secretary
Yu Hailong of the Communist Party Committee of State Development & Investment Corporation (国
家开发投资公司), and general manager of State Development & Investment (Electronics)
Corporation (国投电子公司) and State Development & Investment (High Technology and
Pioneering) Corporation (国投高科技创业公司) since March 1994. He served as general
manager and deputy secretary of the Communist Party Committee of China New Era Group
Corporation (中国新时代控股（集团）公司) since April 2002. From January 2010, he served
as the general manager and secretary of the Communist Party Committee of China New
Era Group Corporation, and from May 2010, he served as the general manger, standing
committee member of the Party Committee and director of China Energy Conservation and
Environmental Protection Group.
Independent director of China State Construction Engineering Corporation Limited and
professor-level senior engineer. Mr. Jia graduated from Liaoning Financial and Trade College
(now Dongbei University of Finance and Economics) with a bachelor’s degree in economics
in February 1982. Worked in the Ministry of Finance from February 1982 to December 2013,
he successively served as deputy director, director, deputy head of the Accounting Division
of the Ministry of Finance, deputy head of General Affairs Division of the Ministry of Finance,
chief of law affairs division of the Ministry of Finance, head of division of corporation of
Jia Chen the Ministry of Finance, and chief of the taxation division of the Ministry of Finance. From
December 2013 to August 2016, he served as a party member and deputy general manager
of China North Industries Group Corporation. In March 2017, he was hired as an external
director of China Mobile Communications Corporation. He used to be the executive director
of the Accounting Society of China, the executive director of the China Association of Chief
Financial Officers, the executive director of Society of Public Finance of China, the vice
chairman of the Asset Management Association of China, and the deputy director of the
Office of the State Council’s Leading Group for the Promotion of SMEs.
Independent director of China State Construction Engineering Corporation Limited,
professor-level senior engineer and a holder of doctoral degree in engineering. Mr. Zheng
held positions as deputy head of Beijing Erqi Locomotive Works (北京二七机车厂), director
of the general office, a director and deputy general manager of China National Railway
Locomotive & Rolling Stock Industry Corporation (中国铁路机车车辆工业总公司), a director
Zheng
and deputy general manager, deputy general manager, secretary of the Party Committee
Changhong
and deputy general manager and the secretary of the Party Committee of CSR Group
Corporation (中国南车集团公司), an Executive director, vice chairman, president, chairman
and secretary of the Party Committee of CSR Corporation Limited (中国南车股份有限公
司), as well as an executive director, vice chairman and secretary of the Party Committee of
CRRC Corporation Limited (中国中车集团).
Chairman of the Board of Supervisors, chief information officer of China State Construction
Engineering Corporation Limited, a researcher-level senior engineer and holder of bachelor’s
degree. He successively served as the deputy head of the technology introduction center
and vice director of business division of Science and Technology Information Institute of
the Ministry of Machinery and Electronics Industry (机械电子工业部科技情报所), director
of the business division of the Science and Technology Information Research Institute of
the Ministry of Machinery Industry, assistant to the dean of the Science and Technology
Information Research Institute of the Ministry of Machinery Industry, assistant to the dean
Shi Zhiping
of the Institute of Mechanical Industry Information and director of the Literature Resource
Center, deputy dean and standing committee member of the Party Committee of the Institute
of Mechanical Industry Information and the director of information center of the SASAC. He
has served as an assistant president and chief information officer of China State Construction
Engineering Corporation Limited since July 2014, chairman of the Board of Supervisors of
China State Construction Engineering Corporation Limited since August 2020. He no longer
served as an assistant president of China State Construction Engineering Corporation
Limited since August 2020.

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Name Major work experience

Supervisor of China State Construction Engineering Corporation Limited, senior engineer
and holder of master in industrial engineering. Mr. Li has served as the deputy director and
director of the coordination office of the Personnel Bureau of China State Construction,
the deputy manager of the personnel department of China State Construction, the general
Li Jianbo
manager of the human resources department of China State Construction, the vice chairman,
secretary of the Party Committee and deputy general manager of China Overseas Holdings
Limited. From March 2018, he no longer served as vice chairman, secretary of the Party
Committee and deputy general manager of China Overseas Holdings Limited.
Supervisor of China State Construction Engineering Corporation Limited and a senior
accountant. Mr. Tian has served as the deputy director of the Audit Department of China
Construction Eighth Engineering Division Corp. Ltd., chief accountant and Party Committee
member of China Construction Eighth Engineering Division Second Company, director,
chief accountant and Party Committee member of China Construction Port Group Co., Ltd.,
Tian Shifang
director, chief financial officer, and Party Committee member of China State Construction
Harbour Construction Co., Ltd. (renamed in December 2019 as China Construction Harbour
and Channel Engineering Bureau Group Co., Ltd.). Since March 2020, he no longer served
as a director, chief financial officer, and Party Committee member of China Construction
Harbour and Channel Engineering Bureau Group Co., Ltd.
Supervisor of China State Construction Engineering Corporation Limited, senior political
engineer and bachelor’s degree holder. He has served as minister of the Propaganda
Department of the Party Committee, deputy secretary of the Party Committee, chairman
Ning Wangchu of the Trade Union, secretary of the Discipline Inspection Commission and supervisor and
inspector of China Southwest Architectural Design and Research Institute. Since February
2018, he no longer served as inspector of China Southwest Architectural Design and
Research Institute.
Supervisor of China State Construction Engineering Corporation Limited, a senior engineer
and bachelor’s degree holder. He successively served as Secretary of the Party Committee
and General Manager of Nanjing Branch of China Construction Second Bureau Second
Company (中建二局二公司), General Manager of China Construction Second Bureau
Lu Yanbin Second Company, Deputy General Manager, standing committee member of the Party
Committee and Director of China Construction Second Bureau Co., Ltd. (中建二局有限公
司), and inspector of China Construction Second Engineering Division Corp. Ltd. (中国建
筑第二工程局有限公司). From February 2018, he no longer served as inspector of China
Construction Second Engineering Division Corp. Ltd.
Chief Accountant of China State Construction Engineering Corporation, a member of the
Party Committee, vice president and chief financial officer of China State Construction
Engineering Corporation Limited, researcher-level senior accountant and master’s degree
holder. He has served as the chief accountant of the Second Research Institute of CASIC
(Group) Company, the deputy director and minister of the Finance Department of CASIC
Wang Yunlin (Group) Company, the chairman of Aerospace Securities Co., Ltd., and the deputy chief
accountant of CASIC (Group) Company, Member of the Party Committee and Chief
Accountant of China Aerospace Science and Industry Corporation Limited. He served as
a member of Party Committee and Chief Financial Officer of China State Construction
Engineering Corporation since December 2018, and vice president and chief financial officer
of China State Construction Engineering Corporation Limited since January 2019.
Deputy general manager and member of Party Committee of China State Construction
Engineering Corporation, vice president of China State Construction Engineering Corporation
Limited, senior engineer, and a Ph.D. holder. He has served as Secretary of the General
Office of the State Council (at the bureau level), Deputy Mayor of Nanjing (posted), a
Standing Committee member of Party Committee and Deputy Mayor of Nanjing (posted),
Deputy Secretary of Yangzhou Municipal Committee (at the municipal level), Deputy
Zhao Xiaojiang
Secretary Lianyungang Municipal Committee, Mayor and Secretary of the Party Committee of
the Municipal Government of Lianyungang. He has been a member of the Party Committee
of the former China State Construction Engineering Corporation since November 2015, the
vice president of China State Construction Engineering Corporation Limited since January
2016, and the vice general manager of the former China State Construction Engineering
Corporation since January 2017.

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Name Major work experience

Deputy general manager and member of Party Committee of China State Construction
Engineering Corporation, vice president of China State Construction Engineering Corporation
Limited, professor-level senior engineering, holder of a part-time postgraduate diploma.
He has served as the former deputy director of China Construction Eighth Engineering
Division; general manager of infrastructure department of China State Construction
Engineering Corporation; executive director and deputy general manager of CSCEC
International Operations; assistant general manager of China State Construction Engineering
Corporation; Chairman of the Board of China State Construction Railway Construction Co.,
Ma Zeping
Ltd.; Chairman of China State Construction Harbour Construction Co., Ltd.; Secretary of
Party Work Committee and General Manager of Infrastructure Business Department of
China State Construction Engineering Corporation Limited; Executive Director and General
Manager of China Construction Infrastructure Co., Ltd. (中国建设基础设施有限公司). He has
been the vice president of China State Construction Engineering Corporation Limited since
December 2010, a member of the Party Committee of the former China State Construction
Engineering Corporation since November 2015, and the deputy general manager of China
State Construction Engineering Corporation since January 2017. National model worker.
Deputy general manager and member of Party Committee of China State Construction
Engineering Corporation, vice president of China State Construction Engineering Corporation
Limited, professor-level senior engineering, holder of bachelor’s degree. Mr. Zhou has
served as Vice Chairman, Executive Director and Chief Executive Officer of China State
Construction International Holdings Limited, Vice Chairman, Deputy General Manager and
Member of Party Committee of China Overseas Holdings Limited, Chairman of the Board
Zhou Yong and Secretary of Party Committee of China State Construction International Holdings
Limited, chairman of the Board of Directors and secretary of the Party Committee of China
Overseas Holdings Limited. He has been a member of the Party Committee of China State
Construction Engineering Corporation since December 2018, and the Deputy General
Manager of China State Construction Engineering Corporation and Vice President of China
State Construction Engineering Corporation Limited since January 2019. He is a Member of
the 13th National Political Consultative Committee.
Deputy general manager, Party Committee member of China State Construction Engineering
Corporation, vice president of China State Construction Engineering Corporation Limited,
senior economist, a master’s degree holder. She successively served as a deputy general
manager of the human resources department (cadre affairs department) of the former
China State Construction Engineering Corporation, a director, deputy secretary of the Party
Shan Guangxiu Committee and deputy general manager of China Construction First Group Corporation
Limited and general manager of the human resources department (cadre affairs department)
of China State Construction Engineering Corporation. She has been a deputy general
manager and Party Committee member of China State Construction Engineering Corporation
since June 2020 and a vice president of China State Construction Engineering Corporation
Limited since September 2020.
Vice president of China State Construction Engineering Corporation Limited, Chairman of
the Board and secretary to Party Committee of China Construction Second Engineering
Division Corp. Ltd., a professor-level senior engineer and holder of master’s degree of
business administration. He successively served as chief economist, deputy director, a
standing committee member of Party Committee, director, general manager, chairman, Party
Huang Kesi Committee secretary of China Construction Eighth Engineering Division Corp. Ltd., and
chairman of CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. He has been the
vice president of China State Construction Engineering Corporation Limited since October
2017, and the chairman and secretary of the Party Committee of China Construction Second
Engineering Division Corp. Ltd. since January 2020. He is also a model worker of SOE and
was granted the National May 1st Labor Medal.

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Name Major work experience

Secretary to the Board of China State Construction Engineering Corporation Limited, senior
accountant, an MBA degree, director of the Chinese Tax Institute, director of Accounting
Society of China, and the consulting expert of the third session of management accounting
of the Ministry of Finance. He has served as the deputy manager of financial and capital
department, general manager of investment department, general manager of capital
department, general manager of financing and investment department of China State
Xue Keqing Construction Engineering Corporation; general manager of capital department and general
manager of finance department of China State Construction Engineering Corporation
Limited; vice chairman and general manager of China State Construction Finance Co., Ltd.;
executive director of COHL; deputy chief accountant of China State Construction Engineering
Corporation Limited and the chief financial officer of China State Construction Engineering
Corporation Limited. He has been the secretary to the Board of Directors of China State
Construction Engineering Corporation Limited since June 2018.

Other explanation

√ Applicable  □ N/A

1. On March 4, 2020, the Company held the 35th meeting of the second session of the Board of Directors and
agreed to appoint Mr. Zheng Xuexuan as the Company’s president.

2. On July 29, 2020, the Company held the 23rd meeting of the second session of the Board of Supervisors.
The Company agreed Mr. Gao Lieyang’s resignation as a supervisor and chairman of the Board of
Supervisors due to job arrangement.

3. On August 21, 2020, the Company held the second extraordinary general meeting in 2020 of the Company
and Mr. Shi Zhiping was appointed as a supervisor of the Company.

4. On August 24, 2020, the Company held the 25th meeting of the second session of the Board of Supervisors
and Mr. Shi Zhiping was appointed as the chairman of the Board of Supervisors of the Company.

5. On September 11, 2020, the Company held the 44th meeting of the second session of the Board of
Directors and agreed to appoint Ms. Shan Guangxiu as a vice president of the Company.

6. On December 7, 2020, the Company held the third extraordinary general meeting in 2020 and Mr. Zhang
Zhaoxiang was appointed as a director of the second session of the Board of Directors of the Company.

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(II) Stock options granted to directors and senior management during the Reporting Period
√ Applicable  □ N/A

Unit: 0’000 shares

Number of
Number of Number of Market price
restricted
restricted Grant price restricted at the end of
shares granted Unlocked
Name Position shares held at of restricted Locked shares shares held as the Reporting
during the shares
the beginning shares (yuan) of the date of Period (0’000
Reporting
of the year disclosure yuan)
Period
Zhou
Chairman 0 0 0 0 0 0 0
Naixiang
Zheng Director,
0 0 0 0 0 0 0
Xuexuan President
Zhang
Director 0 0 0 0 0 0 0
Zhaoxiang
Vice
Wang president,
0 0 0 0 0 0 0
Yunlin chief financial
officer
Zhao Vice
0 0 0 0 0 0 0
Xiaojiang president
Vice
Ma Zeping 0 0 0 0 0 0 0
president
Vice
Zhou Yong 71.8 0 0 11.9 59.9 32 297.703
president
Shan Vice
71.8 0 0 11.9 59.9 32 297.703
Guangxiu president
Huang Vice
71.8 0 0 11.9 59.9 32 297.703
Kesi president
Secretary to
Xue
the Board of 71.8 0 0 11.9 59.9 104 297.703
Keqing
Directors
Total / 287.2 0 / 47.6 239.6 200 1,190.812

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II. Incumbent and Resigned Directors, Supervisors and Senior Management during the
Reporting Period

(I) Positions held in the Company’s shareholders

√ Applicable  □ N/A
Commencement Expiry date
Name of the Company’s Positions in the
Name date of the term of of the term of
shareholders Company’s shareholders
office office
Zhou China State Construction August 2019,
Party secretary, chairman /
Naixiang Engineering Corporation September 2019
September 2018,
Zheng China State Construction Director, general manager,
November 2019, /
Xuexuan Engineering Corporation deputy party secretary
September 2018
Zhang China State Construction Director, deputy party August 2020, July
/
Zhaoxiang Engineering Corporation secretary 2020
China State Construction Chief accountant, member December 2018,
Wang Yunlin /
Engineering Corporation of Party Committee December 2018
Zhao China State Construction Deputy general manager, January 2017,
/
Xiaojiang Engineering Corporation member of Party Committee November 2015
China State Construction Deputy general manager, January 2017,
Ma Zeping /
Engineering Corporation member of Party Committee November 2015
China State Construction Deputy general manager, January 2019,
Zhou Yong /
Engineering Corporation member of Party Committee December 2018
Shan China State Construction Deputy general manager, June 2020, June
/
Guangxiu Engineering Corporation member of Party Committee 2020
In January 2017, China State Construction, a controlling shareholder of the Company, received
the Notice on the Appointment of 4 Personnel including Liu Jinzhang (Guo Zi Ren Zi [2017]
No. 2) from the SASAC of the State Council, appointing Zhao Xiaojiang, Ma Zeping and
Zheng Xuexuan as Deputy General Managers of China State Construction (Now renamed
as China State Construction Engineering Corporation); in September 2018, the Company’s
controlling shareholder China State Construction Engineering Corporation received the Notice
on the Appointment and Removal of Zheng Xuexuan and Liu Jinzhang (Guo Ren Zi [2018]
No. 349) from the State Council, appointing Zheng Xuexuan as a director of China State
Construction Engineering Corporation, and removing Zheng Xuexuan from the post of deputy
general manager of China State Construction Engineering Corporation; in December 2018,
the Company’s controlling shareholder, China State Construction Engineering Corporation,
received the Notice on Wang Yunlin’s Appointment (Guo Ren Zi [2018] No. 418) from the State
Council, appointing Wang Yunlin as chief accountant of China State Construction Engineering
Corporation. In January 2019, the Company’s controlling shareholder, China State Construction
Engineering Corporation, received the Notice on Zhou Yong’s Appointment (Guo Ren Zi [2019]
Employment No. 6) from the State Council, appointing Zhou Yong as the deputy general manager of China
at shareholder State Construction Engineering Corporation. In September 2019, the Organization Department
entities of the Communist Party of China Central Committee announced the decision of the Central
Committee of the Party on the adjustment of the main leaders of China State Construction
Engineering Corporation: Comrade Zhou Naixiang was appointed as the Chairman of China
State Construction Engineering Corporation; Comrade Guan Qing was removed from the
position of Chairman of China State Construction Engineering Corporation In November 2019,
the Organization Department of the Communist Party of China Central Committee announced
the decision of the Central Committee of the Party on the adjustment and supplement of the
general manager of China State Construction Engineering Corporation: Comrade Zheng
Xuexuan was appointed as the general manager of China State Construction Engineering
Corporation. In June 2020, China State Construction, a controlling shareholder of the Company
received the Notice on the Appointment of Shan Guangxiu (Guo Ren Zi [2020] No. 149) from
the State Council, appointing Shan Guangxiu as a deputy general manager of China State
Construction Engineering Corporation. In August 2020, China State Construction, a controlling
shareholder of the Company received the Notice on the Appointment of Zhang Zhaoxiang (Guo
Ren Zi [2020] No. 205) from the State Council, appointing Zhang Zhaoxiang as a director of
China State Construction Engineering Corporation.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Commencement Expiry date

Name of the Company’s Positions in the
Name date of the term of of the term of
shareholders Company’s shareholders
office office
Such personnel were granted a waiver by the China Securities Regulatory Commission from
compliance with part-time job restrictions. Please refer to the Announcement on Exempting
Several Executives from Part-time Employment Restrictions issued on April 11, 2017, the
Announcement on Appointment of Vice President and Chief Financial Officer of the Company
issued on January 16, 2019, the Announcement on Appointment of Vice President of the
Company issued on January 29, 2019, the Announcement on Appointment of the President
of the Company released on March 5, 2020 and the Appointment of Vice President of the
Company issued on September 12, 2020.

(II) Employment at other entities

√ Applicable  □ N/A
Commencement Expiry date
Name of employee Name of other entities Position at other entities date of the term of the term of
of office office
Metallurgical Corporation of
Yu Hailong Independent director November 2014 /
China Ltd.
China Mobile
Jia Chen Communications External director March 2017 /
Corporation
China Communications Independent non- November
Zheng Changhong November 2017
Construction Company executive director 2020
Overseas Chinese Town
Zheng Changhong Independent director January 2018 /
Group Company
Everbright Securities December
Xue Keqing Director November 2017
Company Limited 2020
Employment at
/
other entities

III. Remunerations of Directors, Supervisors and Senior Management

√ Applicable  □ N/A

Decision-making procedures for The business performance evaluation and personal performance evaluation are
remunerations of the directors, carried out by SASAC of the State Council and the Board of Directors, and the
supervisors and senior management remuneration is subject to approval by SASAC of the State Council.
Based on relevant policies of SASAC of the State Council on the remuneration
Basis for determining the
management of heads of central enterprises and external directors, and the
remunerations of the directors,
remuneration management measures of China State Construction Engineering
supervisors and senior management
Corporation Limited.
The total remuneration (including basic salary, performance bonus, insurance
benefits and allowances) received by the current directors (excluding
Actual payments of remunerations of
independent directors), supervisors and senior management of the Company
the directors, supervisors and senior
for the year was RMB5,876,900. The total allowances for the four independent
management
directors for the year was RMB240,000. Please refer to “I. Changes in
Shareholding and Remuneration” in this section.
Remunerations received in
aggregate by all the directors,
RMB6,116,900
supervisors and senior management
at the end of the Reporting Period

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

IV. Changes in Directors, Supervisors and Senior Management

√ Applicable  □ N/A
Name Positions held Change Reason for change
Zheng Xuexuan Chairman Appointment Work required
Zhao Zhaoxiang Director Election Work required
Chairman of the Board of
Shi Zhiping Election Work required
Supervisors
Shan Guangxiu Vice president Appointment Work required
Chairman of the Board of
Gao Lieyang Resign Work arrangement
Supervisors

V. Explanation on being Punished by Securities Regulatory Authority in the Past Three Years

□ Applicable  √ N/A

VI. Employees of Parent Company and Major Subsidiaries

(I) Employees
Number of existing staff of the Company 358
Number of existing staff of principal subsidiaries 356,506
Total number of existing staff 356,864
Number of resigned or retired staff to whom the
Company and principal subsidiaries are liable (Total 78,332
number of retired cadres and staff at the end of 2020)
Expertise
Category Number of Staff
Operation and management 11,803
Project construction 196,390
Prospecting and design 20,476
Properties development 44,128
Professional management 84,067
Total 356,864
Educational level
Category Number of Staff
Master’s Degree or above 26,973
Undergraduate Degree 222,197
Associate Degree 51,107
Technical secondary school and below 56,587
Total 356,864

(II) Remuneration Policy

√ Applicable  □ N/A

The Company adheres to market and performance orientation, and strengthens salary evaluation and incentives.
The Company closely associates remuneration distribution with corporate benefits and personal performance,
and the remuneration is directly proportional to performance, which effectively mobilizes the enthusiasm, initiative
and creativity of employees. Meanwhile, with a focus on value creation, it adheres to linkage of work efficiency,
strengthens benchmarking management, improves performance-based salary management, strengthens the
pertinence, accuracy and effectiveness of remuneration distribution, so as to continuously improve the effective
and constrained remuneration distribution system, and promote corporate vitality, competitiveness and creativity.

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(III) Training Program

√ Applicable  □ N/A

Focusing closely on the “14th Five-Year Plan” and key annual work points, adhering to a clear-cut stand on politics
to ensure the full and complete implementation of central documents, and relying on “leadership, professionalism
and occupational capabilities”, the Company further improved the key talent cultivation project of CSCEC, steadily
promoted the construction of training systems, and continuously improved education and training ability, to
strengthen overall coordination and organization guidance, promote the smooth development of education and
training, and provide internal drivers for the Company’s talent team building.

(IV) Labor Service Outsourcing

□ Applicable  √ N/A

VII. Miscellaneous

√ Applicable  □ N/A

As of the end of the Reporting Period, the Company’s talent structure had been further optimized, and the proportion of
employees with a bachelor's degree or above reached 69.8%.

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SECTION IX  CORPORATE GOVERNANCE

I. Explanation on Corporate Governance
√ Applicable   N/A
During the Reporting Period, the Company strictly operated in accordance with the laws and regulations such as the
Company Law of the People’s Republic of China and the Securities Law of the People’s Republic of China, as well as the
administrative regulations issued by the China Securities Regulatory Commission and the relevant requirements of various
rules formulated by the Shanghai Stock Exchange. It established and perfected a standardized and comprehensive
corporate governance structure, and effectively constructed a set of systematic and complete corporate governance
systems. In 2020, the Company revised 8 basic corporate governance instruments including the Articles of Association,
Rules of Procedure of the General Meeting, and Rules of Procedure of the Board of Directors, optimized the authorization
mechanism of the Board of Directors to the managers, and promoted the working mechanisms of general meeting, the
Board of Directors, the Board of Supervisors, managers, and independent directors to a further standardized and efficient
level. The Company continued to track legislative developments, implemented the country’s latest corporate governance
requirements, interpreted and analyzed the key points of the new Securities Law in a timely manner, and organized
learning and publicity and implementation of such provisions to further improve the corporate governance.
During the Reporting Period, the Company thoroughly implemented the spirit and requirements of the Opinions on Further
Improving the Quality of Listed Companies issued by the State Council and the Announcement on Launching Special
Actions on Governance of Listed Companies issued by the China Securities Regulatory Commission to actively promote
special corporate governance actions. Based on the self-inspection list, the Company formulated special implementation
plans to conduct a comprehensive review and self-examination of the Company’s basic condition, the operation and
decision-making of the organization, the independence of the Company, related party transactions, capital transactions,
external guarantees, the establishment of an internal control system, information disclosure and transparency, institutional
(foreign) investors, etc., so as to effectively enhance the endogenous power of corporate governance, promote governance
efficiency, and promote high-quality development.
During the Reporting Period, the Company continued to improve the quality of information disclosure. Combining statutory
information disclosure and voluntary information disclosure, the Company completed the preparation and disclosure
of 187 compliance reports, including periodic announcements and ad hoc announcements, involving the related party
transactions, external investments, external guarantees, share repurchase and equity incentive and other matters.
The Company was awarded Grade A in the 2019-2020 Information Disclosure Work Evaluation of the Shanghai Stock
Exchange. In order to further improve the level of internationalization of periodic reports and facilitate international partners
and foreign investors to understand the Company’s condition in depth, the Company published the English version of the
2019 annual report and the 2020 interim report globally for the first time.
During the Reporting Period, the Company paid attention to the management and maintenance of investor relations. The
Company overcame the adverse effects of the pandemic and conducted investor communication in an innovative manner
by carrying out investor communication at multiple levels and in innovative ways, communicates with investors through
performance roadshows, general meeting of shareholders, cash dividend briefings, investment strategy meetings, investor
collective reception day activities, etc., with the flexible use of video, telephone, on-site and other forms, and giving full
play to the investor hotline, IR mailbox, SSE e-interactive platform. A total of 208 questions at SSE e-interactive platform
and 199 effective investor hotline calls were answered throughout the year. Active communications were conducted with
mainstream index compilation agency. Investor open day event was organized and nearly 50 investors were invited to
China Construction Science and Industry to exchange their opinions on new intelligent manufacturing. The Company
listened to and properly handled the opinions and suggestions put forward by shareholders and investors.
During the Reporting Period, the Company strictly complied with the Administrative Measures for Information Disclosure
and Internal Reports of Material Information, the Administrative Measures for Accountability Regarding Major Errors in the
Annual Report Information Disclosure, the Regulations on the Management of Funds from Related Party Transactions,
Measures on the Management of Shares of the Company Held by the Directors, Supervisors and Senior Management and
the Changes thereof and the Administrative Measures on Insider Registration. There was no major violation of relevant
rules.
During the Reporting Period, there was no serious corporate governance non-compliance with relevant regulations and
requirements of the China Securities Regulatory Commission. The Company was not subject to administrative punishment
or notification criticism by the China Securities Regulatory Commission, nor was it punished by other regulatory agencies
or condemned by the stock exchange.
During the Reporting Period, the Company was selected into the “SSE Corporate Governance Sector” for 10 consecutive
years, became a sample stock of the SSE Corporate Governance Index, and won a number of honors such as “Sustainable
Development Contribution Award” by CAIJING 《财经》( ); the Board of Directors won the “Best Board of Directors” award
from the Golden Round Table of the Board of Directors for 9 consecutive years.
If there is any serious corporate governance non-compliance with relevant requirements of the China Securities Regulatory
Commission, please provide the reasons
 Applicable  √ N/A

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II. Overview on the General Meeting of Shareholders

Search index of
Date of general the designated Date of disclosure
Session
meeting website for publishing of resolutions
resolutions
The first extraordinary
February 19, 2020 www.sse.com.cn February 20, 2020
general meeting in 2020
2019 annual general meeting May 25, 2020 www.sse.com.cn May 26, 2020
The second extraordinary
August 21, 2020 www.sse.com.cn August 22, 2020
general meeting in 2020
The third extraordinary
December 7, 2020 www.sse.com.cn December 8, 2020
general meeting in 2020

Description of General Meetings

√ Applicable   N/A

During the Reporting Period, a total of 4 proposals were considered at the first extraordinary general meeting in 2020 of the
Company, and all were approved by voting. A total of 15 proposals were considered at the 2019 annual general meeting
of the Company, and all were approved by voting. A total of 2 proposals were considered at the second extraordinary
general meeting in 2020 of the Company, and all were approved by voting. A total of 7 proposals were considered at
the third extraordinary general meeting in 2020 of the Company, and all were approved by voting. The resolutions were
disclosed on the websites of the Shanghai Stock Exchange, China Securities Journal, the Shanghai Securities News, the
Securities Times and the Securities Daily.

III. Performance of Directors’ Duties

(I) Attendance of directors at Board meetings and general meetings

Attendance at Board meetings Attendance
Independent No. of Absence from at general
Name of director director Attendance meetings
meetings to Attendance Attendance meetings for
or not by means of Absence Times of
attend during in person by proxy two consecutive
communication attendance
the year times
Zhou Naixiang No 18 2 14 2 0 No 2
Zheng Xuexuan No 18 4 14 0 0 No 1
Zhang Zhaoxiang No 2 1 1 0 0 No 0
Yang Chunjin Yes 18 3 14 1 0 No 1
Yu Hailong Yes 18 4 14 0 0 No 0
Jia Chen Yes 18 4 14 1 0 No 1
Zheng Changhong Yes 18 4 14 1 0 No 2

On October 28, 2020, as recommended by the Company’s Personnel and Remuneration Committee, upon
consideration and approval at the 47th meeting of the second session of the Board of the Company, it was
agreed to appoint Zhang Zhaoxiang as a candidate for director of the second session of the Board of China State
Construction Engineering Corporation Limited, and such proposal was submitted to the shareholders’ general
meeting for consideration. On December 7, 2020, the Company held the third extraordinary general meeting in
2020, which reviewed and approved the Proposal on Election of Zhang Zhaoxiang as Director of the Second
Session of the Board of China State Construction Engineering Corporation Limited. Mr. Zhang Zhaoxiang was
thus elected as the director of the Company. For details, please refer to the Announcement on Resolutions of the
2020 Third Extraordinary General Meeting of China State Construction Engineering Corporation Limited issued on
December 8, 2020.

The seven directors, i.e., Mr. Zhou Naixiang, Mr. Zheng Xuexuan, Mr. Zhang Zhaoxiang, Mr. Yang Chunjin, Mr.
Yu Hailong, Mr. Jia Chen and Mr. Zheng Changhong are members of the second session of the Board of the
Company.

Description of the members of the Board who failed to attend Board meetings in person for two consecutive times

 Applicable  √ N/A

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No. of Board meetings held during the year 18

Including: No. of on-site Board meetings 4
No. of Board meetings convened by means of communication 14
No. of Board meetings held both on-site and by means of communication 0

(II) Disagreement of the independent directors on matters related to the Company

 Applicable  √N/A

(III) Miscellaneous
√ Applicable   N/A
The Company’s independent directors reviewed and supervised the performance of president Mr. Zheng Xuexuan,
vice president and chief financial officer Mr. Wang Yunlin, vice president Mr. Zhao Xiaojiang, vice president Mr.
Ma Zeping, vice president Mr. Zhou Yong and vice president Ms. Shan Gaungxiu, who also served as senior
executives of the Company’s controlling shareholder, China State Construction Engineering Corporation, and
expressed the following independent opinions: Mr. Zheng Xuexuan, Mr. Wang Yunlin, Mr. Zhao Xiaojiang, Mr. Ma
Zeping, Mr. Zhou Yong and Ms. Shan Guangxiu earnestly and diligently fulfilled their commitments, performed their
duties as senior management of the Company as a priority, well handled the relation between the Company and
the controlling shareholder, and maintained the interests of the Company and all shareholders in 2020, and they
did not do anything that would harm the shareholders of the Company, especially minority shareholders because
of their part-time jobs.

IV. Details that Shall be Disclosed Where There Is Any Disagreement as to Important Advice
and Recommendations Made by the Special Committees of the Board in the Performance of
Their Duties during the Reporting Period
√ Applicable   N/A
The Company’s Board of Directors has set up three special committees, namely the Strategy Committee, Personnel and
Remuneration Committee, and Audit Committee, which seriously organize research and diligently examine professional
issues, and effectively exert the full advising and decision support functions of the special committees. During the
Reporting Period, the special committees under the Board of Directors held 23 meetings and reviewed 47 issues (including
12 reports).
The Strategy Committee held 1 meeting and reviewed 1 proposal. Specifically: On April 23, 2020, the Company convened
the fourth meeting of the Strategy Committee under the second session of the Board to consider the Proposal on the 2020
Investment Budget Report of China State Construction Engineering Corporation Limited. The Strategy Committee improves
the scientificity and rigor of the Company’s investment decision-making process through objective and scientific review of
the Company’s investment management budget.
The Personnel and Remuneration Committee held 10 meetings and reviewed 14 proposals. Specifically: In strict
accordance with the relevant regulations, through comprehensive and objective, systematic and in-depth research
and discussion, and in combination with the Company’s reform and development strategy and actual work needs, the
Personnel and Remuneration Committee revised the Administrative Measures on Remuneration and Assessment of Senior
Management of China State Construction Engineering Corporation Limited, formed the Measures for Implementation,
Assessment and Management of Phase IV Restricted A Share Incentive Scheme of China State Construction Engineering
Corporation Limited, and comprehensively considered and strictly reviewed the specific implementation plans for
unlocking, repurchase and granting of restricted shares, giving full play to independence, objectivity and prudence, and
effectively safeguarding the Company’s healthy, stable and sustainable development.
The Audit Committee convened 12 meetings, reviewed 20 proposals and listened to 12 working reports. Specifically:
The Audit Committee performed its duties strictly in accordance with relevant regulations, strictly reviewed the internal
audit work plan, urged the establishment, improvement and effective implementation of the Company’s internal control
system, and promoted the improvement of scientific and objective decision-making of the Company. First, it urged the
certified public accountants to submit audit or review reports within the agreed time limit, which effectively promoted and
guaranteed the Company’s annual report preparation, auditing, internal control and final accounts, and other related work.
Second, it focused on the audit plan and the progress of pre-review work and consolidated financial statements, problems
found in audits, and rectification, etc., actively and continuously carried out effective and high-quality communication
with the annual auditing certified public accountants, and actively promoted the resolution of the problems found in the
communication in a timely manner. Third, it promoted the professional prudence and independence of related work
by changing financial report auditing institution and internal control auditing institution. Fourth, it further promoted the
institutionalization, standardization and systematization of the Company’s internal control governance system through
careful consideration of the related party transaction plan, applying to the controlling shareholder for entrusted loans and
related party transactions, altering accounting policies and other proposals. Lastly, it carefully listened to the accountant’s
review report and the Company’s financial final accounts report and strictly reviewed the Company’s annual financial
report, interim report and quarterly report, to identify the weak spots and potential management risks in the Company’s
operation and management process in a timely manner, and provided guidance to the management on the issues found.

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V. Board of Supervisors’ Explanation on the Risks Identified

√ Applicable   N/A
During the Reporting Period, the Company’s Board of Supervisors performed its duties conscientiously in accordance
with the Company Law, the Code of Corporate Governance for Listed Companies, the Articles of Association and Rules
of Procedure of Board of Supervisors. Focusing on risk prevention and control, the Board of Supervisors supervised the
finances, internal controls and performance of duties of directors and senior management, the details of which are as
follows:

(I) Work of the Board of Supervisors

1. Focus on supervision and inspection
During the Reporting Period, based on the Company’s major risk management and with a focus on
the Company’s development quality and asset operation efficiency and investment risks, the Board
of Supervisors guided and organized the Office of the Board of Supervisors to conduct supervision,
investigation and inspection on key aspects based on audit findings:
The Board of Supervisors conducted special investigations on the impact of the pandemic in light of its
sudden outbreak. Comprehensively understanding the implementation of the anti-pandemic-related benefit
policies and the impact of the pandemic on production and operation and major economic indicators, the
Board of Supervisors summarized typical experiences and put forward management recommendations
and improvement measures to facilitate the completion of the Company’s annual business and production
goals and tasks.
The Company conducted special investigations in the first-line production and operation units. Based on
the Company’s key work deployment and major risk prevention and control, the Company understood the
production and operation conditions after the pandemic, focused on the typical experience during the
“13th Five-Year Plan” and the strategic concept of the “14th Five-Year Plan”, analyzed the problems in the
development process, and explored and provided innovative targeted suggestions for the Company to
maximize its strengths and avoid weaknesses.
The Board of Supervisors paid attention to the internal control audit of the Company to enhance its internal
control development. The Company focused on financing management, management of completed
projects fulfillment, investment management, real estate project marketing and cost management, etc.,
covering the key control points of the internal control process at the company level, contract costs, capital
management, investment management, etc., to further promote the standardization and refinement of
corporate management.

2. Major risks identified

During the Reporting Period, the Board of Supervisors discovered certain risks in the following areas during
the supervision and inspection process:
(1) The macroeconomic landscape remains complex and changeable. There are many uncertainties
in the development of the pandemic and the external environment. The complicated and severe
world economy, unstable and uneven economic recovery and various derivative risks caused by
the pandemic cannot be ignored. The traditional investment structure is gradually shifting to a
novel investment structure dominated by modern service industries and high-tech manufacturing.
The growth momentum of real estate and infrastructure investment may gradually slow down, and it
will be more difficult to break through in a continuous manner.
(2) The prevention of risks in overseas operations shall be strengthened. The recovery of the
European and American economies is weak, and some emerging markets are still suffering from
the pandemic. The overestimated economic recovery has increased the political uncertainty in
some countries and regions, and the sovereign debt risks of some emerging markets are alarming.
In addition, the management capabilities and management levels of overseas institutions and
projects still need to be continuously improved.
(3) The ability to promote high-quality development with informatization shall be improved. The
Company should lay a solid foundation, make up for shortcomings, and accelerate development
in terms of promoting integrated management and control of the Group through information
construction, using industrial digitization to improve lean management, and expanding the digital
industry to integrate into the new digital economy. It has to further stimulate the vitality of elements.
The construction of key systems for informatization remains to be continued.
(4) The internal control of certain business procedures shall be continuously improved. In general,
there is no systematic deficiency in our internal control system, but several rules or business
procedures of a few units shall be further revised or improved. Some units have not implemented
several internal control links according to the system, and should further strengthen the
implementation of the system.
The Board of Supervisors has reported the above issues and risks to the management of the Company,
and put forward tailored suggestions. The Company actively urged the relevant units to follow the
suggestions and rectify the identified issues. The specific issues have been effectively resolved, and the
problems that require long-term rectification continue to be resolved in stages according to the rectification
plan.

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3. Meetings of the Board of Supervisors

During the Reporting Period, the supervisors of the Company attended 4 general meetings, 4 board
meetings and 6 Audit Committee meetings as well as important meetings in the Company’s daily operations
to regularly understand and timely grasp the Company’s daily operating conditions and important
decision-making conditions and carry out supervision according to law. The Board of Supervisors held 17
meetings, namely the 18th to 34th meetings of the second session of the Board of Supervisors, reviewed
and approved 53 proposals and issued relevant written announcements. The details of the meetings are as
follows:
Name of Form of
Date of meeting Content of proposal
meeting meeting
1. The Proposal on Appointment of Auditors for the 2020 Financial Report of China State Construction
Engineering Corporation Limited
2. The Proposal on Relevant Matters regarding the Redemption of the 150,000,000 Unlisted Preferred
Shares of China State Construction Engineering Corporation Limited
The 18th meeting of the
February 3, 3. The Proposal on Amendments to the Articles of Association of China State Construction Engineering
second session of the In writing
2020 Corporation Limited
Board of Supervisors
4. The Proposal on Amendments to the Rules of Procedure of General Meeting of China State
Construction Engineering Corporation Limited
5. The Proposal on the Convening of the First Extraordinary General Meeting in 2020 of China State
Construction Engineering Corporation Limited
1. Work Report of the Board of Directors in 2019 of China State Construction Engineering Corporation
Limited
2. Work Report of Independent Directors in 2019 of China State Construction Engineering Corporation
Limited
3. Work Report of the Board of Supervisors in 2019 of China State Construction Engineering Corporation
Limited
4. Report on the Performance of Duties of the Audit Committee of the Second Session of the Board of
Directors for 2019 of China State Construction Engineering Corporation Limited
5. President’s Work Report for 2019 of China State Construction Engineering Corporation Limited
6. Senior Management’s Report for 2019 of China State Construction Engineering Corporation Limited
7. The Proposal on 2019 Final Budget Report of China State Construction Engineering Corporation
Limited
8. The Proposal on 2019 Profit Distribution Plan of China State Construction Engineering Corporation
Limited
9. The Proposal in Respect of the Special Notes and Special Reports on Changes in Accounting Policies
The 19th meeting of the
April 24, for 2019 and Special Report of China State Construction Engineering Corporation Limited
second session of the In writing
2020 10. The 2019 Annual Report of China State Construction Engineering Corporation Limited
Board of Supervisors
11. The 2019 Internal Control Evaluation Report of China State Construction Engineering Corporation
Limited
12. 2019 Sustainability Report of China State Construction Engineering Corporation Limited
13. Financial Budget Report in 2020 of China State Construction Engineering Corporation Limited
14. Proposal in Respect of Daily Related Party Transactions of China State Construction Engineering
Corporation Limited for 2020
15. The Proposal on Changing the Internal Control Auditors in 2020 of China State Construction
Engineering Corporation Limited
16. Investment Budget Report for 2020 of China State Construction Engineering Corporation Limited
17. The Proposal on the Proposed Additional Financing Guarantee in 2020 of China State Construction
Engineering Corporation Limited
18. The Proposal on Domestic Bond Issue Quota Reserve of China State Construction Engineering
Corporation Limited
19. The Proposal on Maintenance of Liability Insurance for Directors, Supervisors and Senior Management
of China State Construction Engineering Corporation Limited and Its Subsidiaries for 2020
1 The Proposal on the First Quarterly Financial Report in 2020 of China State Construction Engineering
The 20th meeting of the
April 29, Corporation Limited
second session of the In writing
2020 2. The Proposal on the First Quarterly Report in 2020 of China State Construction Engineering
Board of Supervisors
Corporation Limited
The 21st meeting of the
May 13, 1. The Proposal on Amendments to the Rules of Procedure of the Board of Directors of China State
second session of the In writing
2020 Construction Engineering Corporation Limited
Board of Supervisors
1. The Proposal on the Rules of Procedure of Chairman’s Executive Meeting of China State Construction
The 22nd meeting of the
May 28, Engineering Corporation Limited
second session of the In writing
2020 2. The Proposal on the Rules of Procedure of General Manager’s Executive Meeting of China State
Board of Supervisors
Construction Engineering Corporation Limited
The 23rd meeting of the
July 29, 1. The Proposal on Nominating Candidate for Supervisors of China State Construction Engineering
second session of the In writing
2020 Corporation Limited
Board of Supervisors
The 24th meeting of the
August 5, 1. The Proposal on Amendments to the Allowances Policy for Directors and Supervisors of China State
second session of the In writing
2020 Construction Engineering Corporation Limited
Board of Supervisors
The 25th meeting of the
August 24, 1. The Proposal on Election of the Chairman of the Second Session of Board of Supervisors of China
second session of the On-site
2020 State Construction Engineering Corporation Limited
Board of Supervisors

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Name of Form of
Date of meeting Content of proposal
meeting meeting
1. The Proposal on President’s Semi-annual Report in 2020 of China State Construction Engineering
The 26th meeting of the Corporation Limited
August 27,
second session of the 2. The Proposal on Interim Financial Analysis Report in 2020 of China State Construction Engineering In writing
2020
Board of Supervisors Corporation Limited
3. The Proposal on Interim Report in 2020 of China State Construction Engineering Corporation Limited
1. The Proposal on Phase IV Restricted A Share Incentive Scheme (Draft) of China State Construction
The 27th meeting of the
September 17, Engineering Corporation Limited and Summary
second session of the In writing
2020 2. The Proposal on Measures for Implementation, Assessment and Management of Phase IV Restricted
Board of Supervisors
A Share Incentive Scheme of China State Construction Engineering Corporation Limited
The 28th meeting of the
October 23,
second session of the 1. The Proposal on the Repurchase of Shares of the Company through Centralized Bidding Trading In writing
2020
Board of Supervisors
1. The Proposal on the Third Quarterly Financial Analysis Report in 2020 of China State Construction
The 29th meeting of the
October 28, Engineering Corporation Limited
second session of the In writing
2020 2. The Proposal on the Third Quarterly Report in 2020 of China State Construction Engineering
Board of Supervisors
Corporation Limited
The 30th meeting of the
November 9, 1. The Proposal on the Capital Increase in China State Construction Finance Co., Ltd by the Company
second session of the In writing
2020 and Its Controlling Shareholders and Related Party Transactions
Board of Supervisors
1. The Proposal on the List of Participants and Information on the Grant of Phase IV Restricted A Share
The 31st meeting of the
November 20, Incentive Scheme of China State Construction Engineering Corporation Limited
second session of the In writing
2020 2. The Proposal on the Repurchase of Part of Participants’ Shares under the Phase II and III Restricted A
Board of Supervisors
Share Incentive Scheme of China State Construction Engineering Corporation Limited
The 32nd meeting of the
December 1, 1. The Proposal on Publicity of the List of Participants of the Phase IV Restricted A Share Incentive
second session of the In writing
2020 Scheme of China State Construction Engineering Corporation Limited
Board of Supervisors
1. The Proposal on the Granting under the Phase IV Restricted A Share Incentive Scheme of China State
The 33rd meeting of the
December 23, Construction Engineering Corporation Limited
second session of the In writing
2020 2. The Proposal on Adopting the New Lease Standards of China State Construction Engineering
Board of Supervisors
Corporation Limited
1. The Proposal on the Third Tranche of Unlocking in 2020 in Respect of Phase II Restricted A Share
Incentive Scheme of China State Construction Engineering Corporation Limited
2. The Proposal on the First Tranche of Unlocking in 2020 in Respect of Phase III Restricted A Share
Incentive Scheme of China State Construction Engineering Corporation Limited
3. The Proposal on the Repurchase of Part of Participants’ Shares under the Phase II and III Restricted A
Share Incentive Scheme of China State Construction Engineering Corporation Limited
The 34th meeting of the
December 29, 4. The Proposal on the Audit Arrangement for the Financial Report of Overseas Subsidiaries in 2020 of
second session of the In writing
2020 China State Construction Engineering Corporation Limited
Board of Supervisors
5. The Proposal on Renewal of the Comprehensive Services Framework Agreement between China State
Construction Engineering Corporation Limited and China State Construction Engineering Corporation
6. The Proposal on Renewal of the Financial Services Framework Agreement between China State
Construction Finance Co., Ltd. and China State Construction Engineering Corporation
7. The Proposal on the Provision of Entrusted Loan by China State Construction Engineering Corporation
to China State Construction Engineering Corporation Limited

(II) Independent opinion of the Board of Supervisors

1. Overall management and performance evaluation

During the Reporting Period, in light of the COVID-19 pandemic and the complex and changeable external
environment, the Company thoroughly implemented the decision and deployment of the Party Central
Committee and the State Council under the guidance of President Xi Jinping’s thought on socialism with
Chinese characteristics for a new era, proactively made concrete efforts, calmly responded to changes
in the external environment, actively identified and assessed risks, formulated and issued the Major Risk
Prevention and Control Report of China State Construction Engineering Corporation to effectively prevent
various risks. In 2020, the Company’s production and operation achieved substantial growth against the
trend under extremely difficult conditions. The foundation was further consolidated.

Meanwhile, the Board of Supervisors believed that the Company should further give full play to its leading
role among central enterprises, improve the quality of operation and development, and steadily move
towards its strategic goal of “one creation and five aspects of strength”. The Board of Supervisors provided
the following recommendations for the Company: First, comprehensively deepen reform and innovation to
serve the overall national development; second, attach great importance to cash flow control, and continue
to promote leverage reduction; third, continue to strengthen project management, create high-quality
projects to enhance brand reputation; fourth, steadily practice overseas high-quality development and
cultivate global competitive advantages; fifth, enhance risk prevention to promote the Company’s stable
and long-term development.

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2. Independent opinions on specific matters

(1) Compliance of the Company’s operation

During the Reporting Period, the Company operated in accordance with the Company Law and the
Articles of Association and related policies and regulations, and the decision-making procedures
were legal and effective. The directors and senior management of the Company performed their
duties diligently and conscientiously and were not found to have violated any laws, regulations or
the Articles of Association, or damage the interests of the Company and its shareholders.

(2) Authenticity of financial reports

During the Reporting Period, the Company’s financial statements were prepared in compliance
with the relevant regulations of the Accounting Regulations for Enterprises and the Accounting
Standards for Enterprises. The Company’s 2020 financial report truly reflects its financial condition
and operating results. Ernst & Young Hua Ming LLP (Special General Partnership) issued a
standard unqualified audit report, which is objective and fair.

(3) The Company’s acquisition and disposal of assets

During the Reporting Period, the Company and its subsidiaries completed 0 major external merger
and acquisition and deregistered 66 subsidiaries. During the Reporting Period, the Company’s
acquisition and disposal of assets were not found to be detrimental to the interests of shareholders
or the interests of the Company.

(4) The Company’s related party transactions

During the Reporting Period, the Company’s related party transactions mainly involved related party
sales, related party purchases, property leasing, capital borrowing interest, trademark licensing,
entrusted loans provided by related parties to the Company and co-investment with related parties,
etc., which are necessary and inevitable for ordinary production and operation, and have a positive
significance for the Company’s development. The Company formulated and reviewed the Proposal
in Respect of Daily Related Party Transaction of China State Construction Engineering Corporation
Limited for 2020, and specially reviewed and approved the Proposal on the Capital Increase in
China State Construction Finance Co., Ltd. by the Company and its Controlling Shareholders
and Related Party Transactions, the Proposal on the Renewal of the Comprehensive Services
Framework Agreement between China State Construction Engineering Corporation Limited and
China State Construction Engineering Corporation, the Proposal on the Renewal of the Financial
Services Framework Agreement between China State Construction Finance Co., Ltd. and China
State Construction Engineering Corporation, and the Proposal on the Provision of Entrusted Loan
by China State Construction Engineering Corporation to China State Construction Engineering
Corporation Limited. The procedures of consideration and voting are legal and valid. The Company
(and/or the Company’s controlled subsidiaries) and the related parties respectively signed specific
execution contracts in accordance with the requirements of the plan, which comply with relevant
provisions, and the pricing of related party transactions was fair. The related party transactions
were not found to be detrimental to the interests of shareholders or the interests of the Company.

(5) Special explanation on the Company’s 2020 Internal Control Evaluation Report

During the Reporting Period, the Board of Supervisors paid attention to and urged the rectification
of the Company’s internal control system construction and internal control testing. No violations of
the Guidelines for Internal Control of Listed Companies and the Basic Internal Control Norms for
Enterprises have been found. The evaluation report on the Company’s internal control objectively,
truthfully and accurately reflected the actual situation of the Company’s internal control.

In 2021, the Board of Supervisors of the Company will further promote innovation in accordance
with the requirements to promote the modernization of the governance system and governance
capabilities of enterprises, strictly perform its duties and strengthen supervision in accordance with
the Company Law, the Articles of Association and the Listing Rules to ensure the legitimate rights
and interests of the Company and its shareholders, and fully play its role in corporate governance
of the Company.

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VI. Statement of the Company’s Inability to Ensure Independence and Maintain Its Independent
Operation with Its Controlling Shareholder in Several Aspects such as Business, Personnel,
Assets, Institutions and Financing

 Applicable  √ N/A

Corresponding solutions, working progress and subsequent working plans of the Company in case of horizontal
competition

 Applicable  √ N/A

VII. Appraisal Mechanism for Senior Management and the Establishment and Implementation of
Incentive Mechanism during the Reporting Period

√ Applicable   N/A

For details, please refer to “SECTION VIII DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES”
hereof.

VIII. Disclosure of Internal Control Self-evaluation Report

√ Applicable   N/A

During the Reporting Period, the Company continued to optimize the internal control system, revised and improved the
internal control rules, and ensured the effective implementation of various rules. It further streamlined and standardized
various business processes to improve the Company’s management and risk prevention and control. The Company has
continuously improved its internal control process, covering all aspects including decision-making, execution, supervision,
and feedback. The comprehensiveness and effectiveness of the Company’s internal control have been further improved.

For details of the Company’s internal control evaluation report, please refer to 2020 Internal Control Evaluation Report of
CSCEC as reviewed and approved by the 53rd meeting of the second session of the Board of the Company and disclosed
on the website of the Shanghai Stock Exchange.

Description of material defects of internal control during the Reporting Period

 Applicable  √ N/A

IX. Information on Internal Control Audit Report

√ Applicable   N/A

Upon approval by shareholders at the general meeting, the Company engaged Ernst & Young Hua Ming LLP (Special
General Partnership) to audit the effectiveness of the Company’s internal control related to the financial report as of
December 31, 2020, which issued a standard unqualified internal control audit report.

For details of the internal control audit report, please refer to 2020 Internal Control Audit Report of CSCEC as considered
and approved at the 53rd meeting of the second session of the Board and disclosed on the website of the Shanghai Stock
Exchange.

Whether the Internal Control Audit Report is disclosed: Yes

Type of opinion of the internal control audit report: Standard unqualified opinion

X. Miscellaneous

 Applicable  √ N/A

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SECTION X  INFORMATION ON CORPORATE BONDS

 Applicable  √ N/A

SECTION XI  FINANCIAL REPORT

I. Audit Report

√ Applicable   N/A

Attached hereto

II. Financial Statements

Attached hereto

SECTION XII  INDEX OF DOCUMENTS AVAILABLE FOR INSPECTION

Financial statements signed and sealed by the legal representative (Chairman), person-in-charge of the
accounting affairs (chief financial officer) and person-in-charge of the accounting department (head of the
Index of documents accounting department)
available for The original audit report with the seal of the accounting firm and signatures and seals of the certified
inspection public accountants
The originals of all Company documents and manuscripts of announcements publicly disclosed in
newspapers designated by the China Securities Regulatory Commission during the Reporting Period

China State Construction Engineering Corporation Limited

Chairman: Zhou Naixiang

Date of approval by the Board of Directors for submission: April 16, 2021

AMENDMENTS

 Applicable  √ N/A

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 CONTENT
Audited Financial Statements

For the year ended 31 December, 2020

112 AUDITOR’S REPORT

AUDITED FINANCIAL STATEMENTS

117 Consolidated balance sheet

119 Consolidated income statement

121 Consolidated statement of changes in equity

123 Consolidated statement of cash flows

125 Company balance sheet

127 Company income statement

128 Company statement of changes in equity

130 Company statement of cash flows

132 Notes to the financial statements

298 Supplementary information provided by management

298   1.  Statement of non-recurring profit or loss

298   2.  Return on net assets and earnings per share

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AUDITOR’S REPORT
Ernst & Young Hua Ming (2021) Shen Zi No.61398485_A01

China State Construction Engineering Corporation Limited

To the Shareholders of China State Construction Engineering Corporation Limited,

(I) Opinion

We have audited the financial statements of China State Construction Engineering Corporation Limited (hereinafter
the “Company”), which comprise the consolidated and company balance sheets as at 31 December 2020, and the
consolidated and company income statements, the consolidated and company statements of changes in equity and the
consolidated and company statements of cash flows for the year then ended, and notes to the financial statements.

In our opinion, the accompanying financial statements present fairly, in all material respects, the consolidated and
company’s financial position as at 31 December 2020, and their financial performance and cash flows for the year ended
in accordance with the requirements of Accounting Standards for Business Enterprises (“ASBEs”).

(II) Basis for opinion

We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Our responsibilities under those
standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our
report. We are independent of the Company in accordance with China Code of Ethics for Certified Public Accountants
(the “Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

(III) Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For
each matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial statements
section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures
designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of
our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit
opinion on the accompanying financial statements.

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AUDITOR’S REPORT (continued)

Ernst & Young Hua Ming (2021) Shen Zi No.61398485_A01

China State Construction Engineering Corporation Limited

(III) Key audit matters (continued)

Key audit matter How our audit addressed the key audit matter

Revenue recognition from construction contracts

The revenue of the Company is mainly derived from We obtained an understanding of, tested and evaluated
construction contracts and recognised based on the the relevant controls over revenue recognition from
performance progress over the period of the contract. construction contracts, including the key internal
Depending on the nature of construction projects, control of preparation of revenue and budgeted costs,
determined by input method, the performance progress the determination of performance progress, and the
is measured by reference to the percentage of actual calculation of revenue according to the performance
contract costs incurred to the total budgeted costs. progress.
Management makes estimates on the revenue and
We obtained the list of construction contracts from
budgeted costs at the inception of each contract.
management, and we performed the following procedures
Management shall continuously review and revise financial
on a sample basis:
impacts arising from the changes in the estimated total
revenue and budgeted costs based on factors such as • Reviewed the key terms of the construction
scope changes and cost to completion throughout the contracts, revenue and budgeted costs from
contract period. management, as well as supporting documents
such as changes on budgeted costs, variation
Estimates in respect of revenue, budgeted costs as
orders made to the original contracts and claims
well as the progress of related construction services
and incentives, evaluating the appropriateness of
involve management’s use of significant estimates
management’s estimation basis of revenue and
and judgements, and have significant impact on the
budgeted costs;
recognition of revenue. Therefore, we identified the
revenue recognition from construction contracts as a key • Tested the accuracy of actual costs incurred
audit matter. during the year by reviewing supporting
documents and verifying whether the actual costs
The accounting policies and disclosures are included
were recorded in the appropriate accounting
in notes III. 23 and III. 34 and note V. 49 to the financial
period;
statements.
• Recalculated the accuracy of performance
progress according to actual contract cost
incurred and budgeted costs, and performed
analytical review procedures on gross margin of
significant construction works;

• Visiting selected samples of sites of construction

projects to observe the progress, discussing
with the site project management, comparing the
performance progress with ledger record, and
evaluating the reasonableness of the performance
progress of the construction projects.

Meanwhile, we evaluated the adequacy of disclosure of

revenue recognition from construction contracts.

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AUDITOR’S REPORT (continued)

Ernst & Young Hua Ming (2021) Shen Zi No.61398485_A01

China State Construction Engineering Corporation Limited

(III) Key audit matters (continued)

Key audit matter How our audit addressed the key audit matter

Impairment of accounts receivable, contract assets and long-term receivables

The impairment allowance of accounts receivable, contract We obtained an understanding of, tested and evaluated
assets and long-term receivables was recognised based the relevant controls over the impairment test of accounts
on expected credit losses (ECLs). The management receivable, contract assets and long-term receivables.
determines the ECLs based on reasonable and supportable
For accounts receivable, contract assets, and long-
information on past events, current conditions and forecasts
term receivables which the management assesses the
of future economic conditions etc., which involves significant
ECLs individually, we checked supporting documents to
management’s judgements and estimates. The balances of
assess the customers’ payment ability and the historical
the Company’s accounts receivable, contract assets and
settlement of the contract assets on a sample basis.
long-term receivables are significant, and their recoverability
Combined with the customers’ financial position, credit
has a significant impact on the financial statements.
status, project progress, historical payment record and
Therefore, we identified the impairment of accounts
forecasted future economic situation, we evaluated the
receivable, contract assets and long-term receivables as a
rationality and sufficiency of the management's provision
key audit matter.
of ECLs.
The accounting policies and disclosures are included in
For accounts receivable, contract assets and long-term
notes III. 9 and III. 24 and note V. 4, V. 9 and V. 13 to the
receivables which the management assesses the ECLs
financial statements.
collectively by reference toof the credit risk characteristics
based on the historical payment, settlement and ageing
profile, combined with the current condition and forward-
looking adjustments, we evaluated the appropriateness
of classification by the management and the estimated
ECLs rate for different categories. On a sample basis, we
assessed the accuracy of the credit risk classification and
ageing profiles of accounts receivable, contract assets
and long-term receivables, and recalculated the provision
of ECLs.

We inspected the subsequent payments of accounts

receivable and long-term receivables and the subsequent
settlements of contract assets on a sample basis.

Meanwhile, we evaluated the adequacy of disclosure of

impairment of accounts receivable, contract assets and
long-term receivables.

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 AUDITOR’S REPORT
115
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

AUDITOR’S REPORT (continued)

Ernst & Young Hua Ming (2021) Shen Zi No.61398485_A01
China State Construction Engineering Corporation Limited

(IV) Other information

The management of the Company is responsible for the other information. The other information comprises the information
included in the annual report, other than the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in
the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.

(V) Responsibilities of the management and those charged with governance for the financial
statements
The management of the Company is responsible for the preparation and fair presentation of the financial statements in
accordance with ASBEs, and for designing, implementing and maintaining such internal control as the management
determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting, unless the management either intends to liquidate the Company or to cease operations or has no realistic
alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.

(VI) Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with CSAs will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are generally considered
material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of these financial statements.
As part of an audit in accordance with CSAs, we exercise professional judgement and maintain professional scepticism
throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of internal
control.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the management.
(4) Conclude on the appropriateness of the management’s use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the
Company to cease to continue as a going concern.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

AUDITOR’S REPORT (continued)

Ernst & Young Hua Ming (2021) Shen Zi No.61398485_A01
China State Construction Engineering Corporation Limited

(VI) Auditor’s responsibilities for the audit of the financial statements (continued)

(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and
whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.

(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the Company to express an opinion on the financial statements. We are responsible for the direction,
supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.

We also provide statements to the governance regarding compliance with ethical requirements relating to independence,
communicating with them all relationships and other matters that may reasonably be considered to affect the
independence, as well as the relevant precautions (if applicable).

From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because
the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.

Chinese Certified Public Accountant: Zhou Ying

Ernst & Young Hua Ming LLP

Chinese Certified Public Accountant: Yang Shujuan

Chinese Certified Public Accountant: Shen Yan

    Beijing, China 16 April, 2021

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 Consolidated balance sheet
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Consolidated balance sheet

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

ASSETS Note V 31 December 2020 31 December 2019

Current assets

Cash and bank balances 1 295,857,190 292,441,419

Financial assets held for trading 2 244,459 902,072

Notes receivable 3 31,989,282 26,918,443

Accounts receivable 4 160,441,814 153,961,875

Accounts receivables financing 5 3,788,082 3,674,166

Prepayments 6 42,243,346 55,084,548

Other receivables 7 54,626,721 53,186,521

Inventories 8 675,125,328 578,917,620

Contract assets 9 141,065,956 150,975,326

Current portion of non-current assets 10 77,936,729 57,463,704

Other current assets 11 94,311,158 87,980,288

Total current assets 1,577,630,065 1,461,505,982

Non-current assets

Debt investments 12 14,605,329 17,759,804

Other debt investments 356,377 612,106

Long-term receivables 13 177,642,042 164,825,662

Long-term equity investments 14 86,439,061 74,916,901

Investments in other equity instruments 15 5,838,384 8,069,043

Other non-current financial assets 335,510 50,510

Investment properties 16 97,123,680 76,301,157

Fixed assets 17 39,126,960 37,554,496

Construction in progress 18 10,933,089 10,085,813

Intangible assets 19 22,558,997 16,409,157

Goodwill 20 2,290,261 2,347,428

Long-term prepaid expenses 21 1,098,709 935,800

Deferred tax assets 22 16,249,442 15,129,128

Other non-current assets 23 139,945,933 147,948,942

Total non-current assets 614,543,774 572,945,947

TOTAL ASSETS 2,192,173,839 2,034,451,929

The accompanying notes form an integral part of these financial statements.

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 Consolidated balance sheet
118
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Consolidated balance sheet (continued)

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

LIABILITIES AND SHAREHOLDERS’ EQUITY Note V 31 December 2020 31 December 2019

Current liabilities
Short-term borrowings 25 29,317,096 28,498,331
Notes payable 26 5,265,592 7,030,414
Accounts payable 27 502,386,965 493,129,630
Advances from customers 28 607,427 449,953
Contract liabilities 29 309,479,052 281,789,584
Employee benefits payable 30 8,200,560 7,757,862
Taxes and surcharges payable 31 64,026,873 59,368,941
Other payables 32 118,273,242 114,030,641
Current portion of non-current liabilities 33 88,146,285 89,017,494
Other current liabilities 34 70,311,655 64,654,827
Total current liabilities 1,196,014,747 1,145,727,677
Non-current liabilities
Long-term borrowings 35 292,897,038 247,800,428
Bonds payable 36 88,782,471 99,596,598
Long-term payables 37 17,500,260 19,897,230
Long-term employee benefits payable 38 1,999,420 2,064,489
Provisions 39 3,849,660 4,108,734
Deferred income 40 482,490 444,795
Deferred tax liabilities 22 6,056,150 4,655,710
Other non-current liabilities 41 7,496,502 8,320,948
Total non-current liabilities 419,063,991 386,888,932
TOTAL LIABILITIES 1,615,078,738 1,532,616,609
Shareholders’ equity
Paid-in capital 42 41,965,072 41,975,630
Other equity instruments 43 10,000,000 20,975,410
  Including: Preference shares – 14,975,410
      Perpetual bonds 10,000,000 6,000,000
Capital reserve 44 10,265,751 12,027,610
Less: Treasury shares (4,204,385) (2,501,460)
Other comprehensive income 45 (1,179,401) (1,776,745)
Special reserve 46 135,769 88,474
General risk reserve 1,383,765 1,151,202
Surplus reserve 47 10,101,632 7,716,149
Retained earnings 48 231,953,228 197,541,411
Total equity attributable to the shareholders 300,421,431 277,197,681
Non-controlling interests 276,673,670 224,637,639
Total shareholders’ equity 577,095,101 501,835,320
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 2,192,173,839 2,034,451,929

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song

The accompanying notes form an integral part of these financial statements.

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 Consolidated income statement
119
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Consolidated income statement

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

Note V 2020 2019

Revenue 49 1,615,023,327 1,419,836,588

Less: Cost of sales 49 1,440,131,634 1,262,226,200

  Taxes and surcharges 50 15,895,535 17,220,003

  Selling and distribution expenses 51 5,522,266 4,330,826

  General and administrative expenses 52 28,982,939 27,685,477

  Research and development expenses 53 25,522,546 17,289,939

  Finance expenses 54 7,797,699 7,911,711

   Including: Interest expenses 12,423,310 10,476,405

       Interest income 3,760,919 3,648,525

Add: Other income 612,604 301,988

  Investment income 55 6,151,615 4,212,538

   Including: Share of profit of associates and joint ventures 5,918,135 4,673,782

       Lo
s ses from derecognition of financial assets
measured at amortised cost (2,200,204) (2,330,684)

  Gains/(losses) arising from changes in fair value 56 50,773 (484,752)

  Credit impairment losses 57 (3,341,524) (2,271,556)

  Asset impairment losses 58 (328,482) (1,266,669)

  Gains on disposals of assets 166,167 131,105

Operating profit 94,481,861 83,795,086

Add: Non-operating income 59 809,174 1,294,032

Less: Non-operating expenses 60 1,000,430 3,621,272

Profit before income taxes 94,290,605 81,467,846

Less: Income tax expenses 62 23,340,225 18,262,603

Profit 70,950,380 63,205,243

Classified by continuity of operations

  Profit from continuing operations 70,950,380 63,205,243

Classified by ownership of the equity

  Profit attributable to owners of the parent 44,944,250 41,881,399

  Profit attributable to non-controlling interests 26,006,130 21,323,844

The accompanying notes form an integral part of these financial statements.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Consolidated income statement (continued)

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

Note V 2020 2019

Other comprehensive income, net of tax 938,030 606,129

Attributable to owners of the parents 908,034 580,780

Other comprehensive income that will not

  be reclassified to profit or loss (776,873) 1,033,764

  Remeasurement gains or losses of a defined benefit plan (44,024) (27,690)

  Changes in fair value of investments in other equity instruments (732,849) 1,061,454

Other comprehensive income that may be reclassified to

  profit or loss 1,684,907 (452,984)

  Shares of other comprehensive losses that will be reclassified

subsequently into profit or loss by the investee under equity

method 95,073 (189,202)

  Changes in fair value of other debt investments (22,825) 11,483

  Exchange differences on translation of foreign currency financial

statements 1,612,659 (275,265)

Attributable to non-controlling interests 29,996 25,349

Total comprehensive income 71,888,410 63,811,372

  Attributable to owners of the parent 45,852,284 42,462,179

  Attributable to non-controlling interests 26,036,126 21,349,193

Earnings per share 63

Basic earnings per share (RMB/share) 1.07 0.97

Diluted earnings per share (RMB/share) 1.07 0.96

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song

The accompanying notes form an integral part of these financial statements.

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 Consolidated statement of changes in equity
For the year ended 31 December 2020

BAR21010002_E_CSCEC 2020AR()_.indb 121

(All amounts in RMB Thousand Yuan unless otherwise stated)
Attributable to shareholders of the Company
Other equity instruments Less: Other Non- Total
Paid-in Preference Perpetual Capital Treasury comprehensive Special General risk Surplus Retained controlling shareholders’
capital shares bonds reserve shares incomes reserves reserves reserves earnings Subtotal interests equity
I. Balance at the beginning of the year 41,975,630 14,975,410 6,000,000 12,027,610 (2,501,460) (1,776,745) 88,474 1,151,202 7,716,149 197,541,411 277,197,681 224,637,639 501,835,320
II. Changes for the year
1. Total comprehensive income – – – – – 908,034 – – – 44,944,250 45,852,284 26,036,126 71,888,410
2. Owners’ contributions and reductions in capital
(1) Capital contributions by shareholders – – – – – – – – – – – 12,666,433 12,666,433
(2) Capital contributions by the holders of
other equity instruments – (14,975,410) 4,000,000 – – – – – – – (10,975,410) 23,430,843 12,455,433
(3) Share-based payments – – – 511,805 – – – – – – 511,805 12,022 523,827
(4) Effect on changes in shareholding of
subsidiaries – – – (260,799) – – – – – – (260,799) (256,611) (517,410)
(5) Buy back and cancellation of locked
restricted shares (10,558) – – (25,655) 36,213 – – – – – – – –
(6) Effect on buyback of restricted shares
and grants to employees – – – (2,001,452) (2,790,830) – – – – – (4,792,282) – (4,792,282)
(7) Effect on unlocking restricted shares – – – – 1,051,692 – – – – – 1,051,692 – 1,051,692
(8) Others – – – 14,242 – – – – – (29,067) (14,825) (175,419) (190,244)
3. Profit distribution
(1) Appropriation to surplus reserve – – – – – – – – 2,385,483 (2,385,483) – – –
(2) Appropriation to general risk reserve – – – – – – – 232,563 – (232,563) – – –
(3) Profit distribution to shareholders – – – – – – – – – (7,763,538) (7,763,538) (7,257,600) (15,021,138)
(4) Pro fit distribution to holders of other
equity instruments – – – – – – – – – (402,574) (402,574) (2,434,574) (2,837,148)
4. Transfer within equity
(1) Other comprehensive income transferring
to retained earnings – – – – – (310,690) – – – 310,690 – – –
5. Special reserve
(1) Appropriation to safety production
expenses – – – – – – 26,513,826 – – – 26,513,826 86,967 26,600,793
(2) Use of safety production expenses – – – – – – (26,466,531) – – – (26,466,531) (72,156) (26,538,687)
6. Others – – – – – – – – – (29,898) (29,898) – (29,898)
III. Balance at the end of the year 41,965,072 – 10,000,000 10,265,751 (4,204,385) (1,179,401) 135,769 1,383,765 10,101,632 231,953,228 300,421,431 276,673,670 577,095,101

The accompanying notes form an integral part of these financial statements.

CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
Consolidated statement of changes in equity
121

2021/5/21 13:20:15
 122
Consolidated statement of changes in equity (continued)
For the year ended 31 December 2019

(All amounts in RMB Thousand Yuan unless otherwise stated)

BAR21010002_E_CSCEC 2020AR()_.indb 122

Attributable to shareholders of the Company
Other equity instruments Less: Other Non- Total
Paid-in Preference Perpetual Capital Treasury comprehensive Special General risk Surplus Retained controlling shareholders’
capital shares bonds reserves shares incomes reserves reserves reserves earnings Subtotal interests equity
I. Balance at the end of prior year 41,985,174 14,975,410 7,996,770 11,262,289 (2,924,442) (1,699,877) 77,329 656,661 6,003,665 165,628,207 243,961,186 185,303,070 429,264,256
Add: Other changes in accounting policies – – – – – (657,648) – – 72,060 516,681 (68,907) (86,418) (155,325)
II. Balance at the beginning of the year 41,985,174 14,975,410 7,996,770 11,262,289 (2,924,442) (2,357,525) 77,329 656,661 6,075,725 166,144,888 243,892,279 185,216,652 429,108,931
III. Changes for the year
1. Total comprehensive income – – – – – 583,025 – – – 41,881,399 42,464,424 21,349,193 63,813,617
2. Owners’ contributions and reductions in capital
(1) Capital contributions by shareholders – – – – – – – – – – – 5,915,864 5,915,864
(2) Capital contributions by the holders of other
equity instruments – – (1,996,770) – – – – – – – (1,996,770) 21,519,257 19,522,487
(3) Share-based payments – – – 654,785 – – – – – – 654,785 105,136 759,921
Consolidated statement of changes in equity

(4) Effect on changes in shareholding of

subsidiaries – – – 38,131 – – – – – (1,054) 37,077 (1,175,966) (1,138,889)
(5) Buyback and cancellation of locked
restricted shares (9,544) – – (22,323) 31,867 – – – – – – – –
(6) Others – – – 94,728 391,115 – – – – – 485,843 – 485,843
3. Profit distribution
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(1) Appropriation to surplus reserve – – – – – – – – 1,640,424 (1,640,424) – – –

(2) Appropriation to general risk reserve – – – – – – – 494,541 – (494,541) – – –
(3) Profit distribution to shareholders – – – – – – – – – (7,052,853) (7,052,853) (5,634,839) (12,687,692)
(4) Profit distribution to holders of other equity
instruments – – – – – – – – – (1,302,795) (1,302,795) (2,674,493) (3,977,288)
4. Transfer within equity
(1) Other comprehensive income transferring to
retained earnings – – – – – (2,245) – – – 2,245 – – –
5. Special reserve
(1) Appropriation to safety production expenses – – – – – – 23,237,877 – – – 23,237,877 73,383 23,311,260
(2) Use of safety production expenses – – – – – – (23,226,732) – – – (23,226,732) (56,548) (23,283,280)
6. Others – – – – – – – – – 4,546 4,546 – 4,546
IV. Balance at the end of the year 41,975,630 14,975,410 6,000,000 12,027,610 (2,501,460) (1,776,745) 88,474 1,151,202 7,716,149 197,541,411 277,197,681 224,637,639 501,835,320

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song

The accompanying notes form an integral part of these financial statements.

2021/5/21 13:20:16
 Consolidated statement of cash flows
123
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Consolidated statement of cash flows

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

Note V 2020 2019

I. Cash flows from operating activities

Cash receipts from sales of goods and rendering of services 1,718,935,581 1,504,062,812

Refund of taxes and surcharges 195,961 89,985

Cash receipts relating to other operating activities 64 16,405,472 19,369,597

Sub-total cash flows from operating activities 1,735,537,014 1,523,522,394

Cash payments for goods and services 1,543,777,349 1,394,717,262

Cash payments to and on behalf of employees 78,597,334 73,848,103

Payments of taxes and surcharges 65,839,462 59,391,122

Cash payments relating to other operating activities 64 27,051,088 29,785,984

Sub-total cash flows used in operating activities 1,715,265,233 1,557,742,471

Net cash flows from/(used in) operating activities 65 20,271,781 (34,220,077)

II. Cash flows from investing activities

Cash receipts from disposal of investments 6,358,245 8,393,599

Cash receipts from returns on investments 3,944,880 4,957,371

Net cash receipts from disposal of fixed assets, intangible

assets and other long-term assets 3,277,269 2,186,400

Net cash receipts from disposal of subsidiaries and other

business units 20,018 48,539

Net cash receipts from acquisition of subsidiaries and other

business units – 467,693

Cash receipts relating to other investing activities 64 15,930,043 16,235,302

Sub-total cash flows from investing activities 29,530,455 32,288,904

Cash payments to acquire fixed assets, intangible assets and

other long-term assets 49,497,737 20,436,792

Cash payments for investments 13,207,131 11,280,575

Net cash payments to acquire subsidiaries and other business

units 2,496,697 –

Cash payments relating to other investing activities 64 16,956,675 20,384,348

Sub-total cash flows used in investing activities 82,158,240 52,101,715

Net cash flows used in investing activities (52,627,785) (19,812,811)

The accompanying notes form an integral part of these financial statements.

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124
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Consolidated statement of cash flows (continued)

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

Note V 2020 2019

III. Cash flows from financing activities

Cash receipts from capital contributions 57,099,738 29,815,290

  Including: Cash receipts from capital contributions from non-

controlling shareholders of subsidiaries 47,099,738 29,815,290

Cash receipts from borrowings 271,654,818 184,449,477

Cash receipts from issuance of bonds 21,637,147 15,130,566

Cash receipts relating to other financing activities 64 14,260,156 10,533,485

Sub-total cash flows from financing activities 364,651,859 239,928,818

Repayments of borrowings 254,857,899 161,987,155

Cash payments for distribution of dividends or profit and

interest expenses 40,939,333 37,387,427

  Including: Dividends or profit paid to non-controlling

      shareholders of subsidiaries 10,065,197 8,009,883

Cash payments to acquire non-controlling interest of

subsidiaries 517,410 222,492

Other cash payments relating to financing activities 64 37,519,166 14,023,834

Sub-total cash flows used in financing activities 333,833,808 213,620,908

Net cash flows from financing activities 30,818,051 26,307,910

IV. Effect of foreign exchange rate changes on cash and cash

equivalents (2,328,275) 642,592

V. Net decrease in cash and cash equivalents (3,866,228) (27,082,386)

Add: Cash and cash equivalents at the beginning of the year 271,727,808 298,810,194

VI. Cash and cash equivalents at the end of the year 65 267,861,580 271,727,808

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song
The accompanying notes form an integral part of these financial statements.

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 Company balance sheet
125
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Company balance sheet

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

ASSETS Note XV 31 December 2020 31 December 2019
Current assets

Cash and bank balances 24,262,315 21,561,651

Notes receivable 129,092 102,188

Accounts receivable 1 24,796,051 28,086,588

Accounts receivable financing 1,300 6,100

Prepayments 7,975,589 7,039,642

Other receivables 2 22,028,907 22,569,711

Inventories 114,451 340,527

Contract assets 6,673,619 7,495,304

Current portion of non-current assets 5,329,588 4,291,107

Other current assets 4,006,076 4,132,472

Total current assets 95,316,988 95,625,290

Non-current assets

Debt investments 8,597,518 8,115,503

Long-term receivables 4,109 –

Long-term equity investments 3 184,728,922 170,723,729

Investments in other equity instruments 1,148,493 1,837,882

Other non-current financial assets 300,000 –

Investment properties 590,927 621,752

Fixed assets 799,412 839,905

Construction in progress 82,790 53,957

Intangible assets 128,294 107,442

Long-term prepaid expenses 24,084 3,037

Deferred tax assets 756,192 333,973

Other non-current assets 5,600,968 7,879,408

Total non-current assets 202,761,709 190,516,588

TOTAL ASSETS 298,078,697 286,141,878

The accompanying notes form an integral part of these financial statements.

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 Company balance sheet
126
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Company balance sheet (continued)

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

LIABILITIES AND SHAREHOLDERS’ EQUITY 31 December 2020 31 December 2019
Current liabilities
Short-term borrowings 29,526,988 16,019,470
Accounts payable 43,286,709 43,506,320
Contract liabilities 15,009,805 14,774,502
Employee benefit payable 376,220 521,869
Taxes payable 2,488,417 777,906
Other payables 48,191,653 41,148,194
Current portion of non-current liabilities 8,918,702 13,075,858
Other current liabilities 3,451,995 3,803,807
Total current liabilities 151,250,489 133,627,926
Non-current liabilities
Long-term borrowings 3,323,000 3,845,000
Bonds payable 9,991,784 12,886,322
Long-term payables 13,861,836 17,093,457
Long-term employee benefit payable 148,830 122,053
Provisions 25,092 28,540
Deferred income 4,521 7,455
Total non-current liabilities 27,355,063 33,982,827
TOTAL LIABILITIES 178,605,552 167,610,753
Shareholders’ equity
Paid-in capital 41,965,072 41,975,630
Other equity instruments 10,000,000 20,975,410
  Including: Preference shares – 14,975,410
      Perpetual bonds 10,000,000 6,000,000
Capital reserve 29,016,685 30,537,559
Less: Treasury shares (4,204,385) (2,501,460)
Other comprehensive income (738,725) 126,114
Special reserve 25,106 –
Surplus reserve 10,101,632 7,716,149
Retained earnings 33,307,760 19,701,723
Total shareholders’ equity 119,473,145 118,531,125
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 298,078,697 286,141,878

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song

The accompanying notes form an integral part of these financial statements.

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 Company income statement
127
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Company income statement

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

Note XV 2020 2019
Revenue 4 93,591,736 111,416,548
Less: Cost of sales 4 92,105,955 108,104,981
Taxes and surcharges 101,818 173,291
General and administrative expenses 1,100,393 1,249,089
Research and development expenses 106,352 48,364
Finance expenses 2,354,191 2,147,074
  Including: Interest expenses 2,277,633 2,271,228
Interest income 234,754 218,747
Add: Other income 12,869 8,813
Investment income 5 28,912,147 17,848,100
  Including: Share of losses of associates and joint ventures (23,933) (8,118)
Credit impairment losses (410,674) (693,852)
Asset impairment losses (363,436) (97,881)
Gains on disposals of assets 858 328
Operating profit 25,974,791 16,759,257
Add: Non-operating income 8,097 31,593
Less: Non-operating expenses 42,395 30,151
Profit before income taxes 25,940,493 16,760,699
Less: Income tax expenses 2,140,049 356,456
Profit 23,800,444 16,404,243
  Including: Profit from continuing operations 23,800,444 16,404,243
Other comprehensive income, net of tax (507,651) 173,163
Other comprehensive income that will not be reclassified to
profit or loss (169,398) 180,882
  Remeasurement gains or losses of a defined benefit plan (8,370) (3,910)
  Changes in fair value of investments in other equity instruments (161,028) 184,792
Other comprehensive income that may be reclassified to
profit or loss (338,253) (7,719)
  Shares of other comprehensive losses that will be reclassified
subsequently into profit or loss by the investee under equity
method (164) 345
  Exchange differences on translation of foreign currency financial
statements (338,089) (8,064)
Total comprehensive income 23,292,793 16,577,406

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song
The accompanying notes form an integral part of these financial statements.

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 128
Company statement of changes in equity
For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

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Other equity instruments Other Total
Paid-in Preference Perpetual Capital Less: Treasury comprehensive Special Surplus Retained shareholders’
capital shares bonds reserves shares incomes reserves reserves earnings equity
I. Balance at the beginning of the year 41,975,630 14,975,410 6,000,000 30,537,559 (2,501,460) 126,114 – 7,716,149 19,701,723 118,531,125
II. Changes for the year
1. Total comprehensive income – – – – – (507,651) – – 23,800,444 23,292,793
2. O w n e r s ’ c o n t r i b u t i o n s a n d
reductions in capital
(1) C a p i t a l c o n t r i b u t i o n s b y
the holders of other equity
instruments – (14,975,410) 4,000,000 – – – – – – (10,975,410)
(2) Share-based payments – – – 506,233 – – – – – 506,233
Company statement of changes in equity

(3) Buyback and cancellation of

locked restricted shares (10,558) – – (25,655) 36,213 – – – – –
(4) Effect on buyback of restricted
shares and grants to employees – – – (2,001,452) (2,790,830) – – – – (4,792,282)
(5) Effect on unlocking restricted
shares – – – – 1,051,692 – – – – 1,051,692
3. Profit distribution
(1) Appropriation to surplus reserve – – – – – – – 2,385,483 (2,385,483) –
(2) P r o f i t d i s t r i b u t i o n t o
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

shareholders – – – – – – – – (7,763,538) (7,763,538)

(3) Profit distribution to holders of
other equity instruments – – – – – – – – (402,574) (402,574)
4. Transfer within equity
(1) Other comprehensive income
transferring to retained earnings – – – – – (357,188) – – 357,188 –
5. Special reserve
(1) A p p r o p r i a t i o n t o s a f e t y
production expenses – – – – – – 834,406 – – 834,406
(2) Use of safety production
expenses – – – – – – (809,300) – – (809,300)
III. Balance at the end of the year 41,965,072 – 10,000,000 29,016,685 (4,204,385) (738,725) 25,106 10,101,632 33,307,760 119,473,145

The accompanying notes form an integral part of these financial statements.

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 Company statement of changes in equity (continued)
For the year ended 31 December 2019

BAR21010002_E_CSCEC 2020AR()_.indb 129

(All amounts in RMB Thousand Yuan unless otherwise stated)
Other equity instruments Other Total
Preference Perpetual Capital Less: Treasury comprehensive Special Surplus Retained shareholders’
Paid-in capital shares bonds reserves shares incomes reserves reserves earnings equity
I. Balance at the end of prior year 41,985,174 14,975,410 7,996,770 29,955,921 (2,924,442) (257,500) – 6,003,665 12,645,010 110,380,008
Add: Other changes in accounting policies – – – – – 210,451 – 72,060 648,542 931,053
II. Balance at the beginning of the year 41,985,174 14,975,410 7,996,770 29,955,921 (2,924,442) (47,049) – 6,075,725 13,293,552 111,311,061
III. Changes for the year
1. Total comprehensive income – – – – – 173,163 – – 16,404,243 16,577,406
2. Owners’ contributions and reduction
in capital
(1) C a p i t a l c o n t r i b u t i o n s b y
the holders of other equity
instruments – – (1,996,770) – – – – – – (1,996,770)
(2) Share-based payments – – – 554,496 – – – – – 554,496
(3) Buyback and cancellation of
locked restricted shares (9,544) – – (22,323) 31,867 – – – – –
(4) Others – – – 49,465 391,115 – – – – 440,580
3. Profit distribution
(1) Appropriation to surplus reserve – – – – – – – 1,640,424 (1,640,424) –
(2) Profit distribution to shareholders – – – – – – – – (7,052,853) (7,052,853)
(3) Profit distribution to holders of
other equity instruments – – – – – – – – (1,302,795) (1,302,795)
4. Special reserve
(1) Appropriation to safety production
expenses – – – – – – 1,112,655 – – 1,112,655
(2) U s e o f s a f e t y p r o d u c t i o n
expenses – – – – – – (1,112,655) – – (1,112,655)
IV. Balance at the end of the year 41,975,630 14,975,410 6,000,000 30,537,559 (2,501,460) 126,114 – 7,716,149 19,701,723 118,531,125

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song
The accompanying notes form an integral part of these financial statements.
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
Company statement of changes in equity
129

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 Company statement of cash flows
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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Company statement of cash flows

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

2020 2019

I. Cash flows from operating activities

Cash receipts from sales of goods and rendering of services 104,193,886 118,794,506

Refund of taxes and surcharges 45,982 563

Cash receipts relating to other operating activities 8,257,093 6,270,607

Sub-total cash flows from operating activities 112,496,961 125,065,676

Cash payments for goods and services 98,878,560 109,905,675

Cash payments to and on behalf of employees 1,775,759 1,915,066

Payments of taxes and surcharges 1,335,772 946,219

Cash payments relating to other operating activities 4,329,908 7,598,603

Sub-total cash flows used in operating activities 106,319,999 120,365,563

Net cash flows from operating activities 6,176,962 4,700,113

II. Cash flows from investing activities

Cash receipts from disposal of investments 417,343 1,772,318

Cash receipts from returns on investments 28,768,632 19,211,427

Net cash receipts from disposal of fixed assets, intangible assets and
other long-term assets 515 2,776

Cash receipts relating to other investing activities 1,909,891 2,266,843

Sub-total cash flows from investing activities 31,096,381 23,253,364

Cash payments to acquire fixed assets, intangible assets and other long-term
assets 244,550 201,915

Cash payments for investments 13,235,510 8,298,400

Cash payments relating to other investing activities 1,039,292 3,075,237

Sub-total cash flows used in investing activities 14,519,352 11,575,552

Net cash flows from investing activities 16,577,029 11,677,812

The accompanying notes form an integral part of these financial statements.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Company statement of cash flows (continued)

For the year ended 31 December 2020

(All amounts in RMB Thousand Yuan unless otherwise stated)

2020 2019

III. Cash flows from financing activities

Cash receipts from capital contributions 10,000,000 –

Cash receipts from borrowings 51,500,000 22,000,000

Cash receipts relating to other financing activities 5,256,079 2,248,813

Sub-total cash flows from financing activities 66,756,079 24,248,813

Repayments of borrowings 48,022,000 23,415,000

Cash payments for distribution of dividends or profit and interest expenses 11,088,697 10,844,930

Other cash payments relating to financing activities 28,104,100 8,767,963

Sub-total cash flows used in financing activities 87,214,797 43,027,893

Net cash flows used in financing activities (20,458,718) (18,779,080)

IV. Effect of foreign exchange rate changes on cash and cash equivalents (160,243) (147,879)

V. Net increase/(decrease) in cash and cash equivalents 2,135,030 (2,549,034)

Add: Cash and cash equivalents at the beginning of the year 21,528,343 24,077,377

VI. Cash and cash equivalents at the end of the year 23,663,373 21,528,343

The financial statements have been signed by:

Chairman: Zhou Naixiang Chief Finance Officer: Wang Yunlin Head of the Finance Department: Xie Song
The accompanying notes form an integral part of these financial statements.

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 Notes to the financial statements
132
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Notes to the financial statements II. Basis of preparation of the financial

statements
I. General information These financial statements have been prepared
China State Construction Engineering Corporation in accordance with the Accounting Standards for
Limited (“the Company”) was established as a joint Business Enterprises – Basic Standard and specific
stock limited company under the People’s Republic accounting standards, implementation guidance,
of China (“PRC”) laws and regulations in accordance interpretations, other relevant regulations issued
with the approval of Guo Zi Gai Ge [2007] No. 1495 subsequently by the Ministry of Finance (the “MOF”)
issued by State-owned Assets Supervision and (hereinafter collectively referred to as “ASBEs”).
Administration Commission of the State Council The financial statements have been presented on a
(“SASAC”) on 6 December 2007. The founder- going concern basis.
members of the Company are China State Construction
Engineering Corporation (“CSCEC”), China National The financial statements have been prepared under the
Petroleum Corporation, Baosteel Group Corporation historical cost convention, except for certain financial
and Sinochem Corporation (the latter three are called instruments. If the assets are impaired, corresponding
by “other founder-members”). provisions for impairment shall be made according to
relevant requirements.
In November 2017, after approval by SASAC,
CSCEC was transformed from a wholly people- III. Significant accounting policies and
owned enterprise to a wholly state-owned company.
estimates
After the transformation, the Company’s name was
changed to China State Construction Engineering Co., Specific accounting policies and estimates were
Ltd. (“CSCEC”), and its contributor was SASAC who decided by the Group according to the characteristics
represents the State Council. of its production and operation, mainly including
measurement of expected credit losses on receivables
The Company was established on 10 December 2007 in
and contract assets, valuation method of inventories,
Beijing, PRC, and its head quarter is situated in Beijing,
recognition and measurement of revenue.
PRC. The parent company and the ultimate parent
company of the Company is CSCEC. The Company 1. Statement of compliance with ASBEs
was listed on Shanghai Stock Exchange (“A shares”)
for trading in July 2009. As at 31 December 2020, The consolidated and company financial statements
total share capital of the Company was approximately present fairly and fully the financial position of the
RMB42 billion at the par value of RMB1.00 per share. Group and the Company as at 31 December 2020, and
As at 31 December 2020, CSCEC held approximately the financial performance and the cash flows for the
23,630,700,000 shares, representing 56.31% of the year ended in accordance with ASBEs.
total share capital.
2. Accounting period
The approved scope of business of the Company
The accounting year of the Group is from 1 January to
and its subsidiaries (together “the Group”) includes
31 December of each calendar year.
survey, design, construction, installation, consultation,
development, decoration service, manufacturing, 3. Functional currency
wholesale, retail and imports and exports. The
core operations include: offering a full range of The Group’s reporting and presentation currency is
construction-related services to foreign and domestic Renminbi (“RMB”). Unless otherwise specified, all are
civil engineering and building construction such as expressed in thousands of RMB.
construction, installation and consultation, investment Each subsidiary, joint venture or associate of the Group
and construction of infrastructure projects, foreign and determines its own functional currency based on the
domestic real estate investment and development, primary economic environment in which it operates.
architecture and infrastructure construction survey
and design, decoration engineering, landscape 4. Business combinations
engineering design and construction, industrial Business combinations are classified into business
investment, contracting for foreign projects in PRC, combinations involving entities under common control
import and export, production and distribution of and business combinations not involving entities under
construction materials and other non-metal mineral common control.
products, construction-related metalwork and tools
and construction engineering and drilling equipment, Business combinations involving entities under
and financial business such as lending and borrowing
common control
within the Group.
A business combination involving entities under
These financial statements are authorised for issue by
common control is a business combination in which
the Company’s Board of Directors on 16 April 2021.
all of the combining entities are ultimately controlled
Please refer to Note VI for details of significant by the same party or parties both before and after the
subsidiaries included in the consolidation scope in the combination, and that control is not transitory. In a
current year. The Group does not have any significant business combination involving entities under common
subsidiaries newly included in the consolidation scope
or excluded from the consolidation scope in the current
year.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

control, the entity that, at the combination date, obtains Group’s previously held equity interest in the acquiree.
control of another combining entity is the absorbing If after that reassessment, the aggregate of the fair
entity, while that other combining entity is the entity value of the consideration transferred (or the fair
being absorbed. The combination date refers to the value of the equity securities issued) and the Group’s
date on which the merging party actually obtains previously held equity interest in the acquiree is still
control of the merged party. lower than the Group’s interest in the fair value of the
acquiree’s net identifiable assets, the Group recognises
The assets and liabilities (including goodwill arising
the remaining difference in profit or loss.
from the ultimate controlling party’s acquisition of
the entity being absorbed) that are obtained by the Where a business combination not involving
absorbing entity in a business combination involving enterprises under common control is achieved through
entities under common control shall be measured on multiple transactions in stages, the long-term equity
the basis of their carrying amounts in the financial investments held in the acquiree before the acquisition
statements of the ultimate controlling party at the date are remeasured at fair value at the acquisition
combination date. The difference between the carrying date, with any difference between the fair value and
amount of the net assets obtained and the carrying the carrying amount included in investment income
amount of the consideration paid for the combination for the current period. Where the long-term equity
(or the aggregate face value of shares issued as investments held in the acquiree before the acquisition
consideration) shall be adjusted to share premium date relates to other comprehensive income measured
under capital reserve. If the capital premium is not under the equity method, the accounting treatment
sufficient to absorb the difference, any excess shall be shall be conducted on the same basis as the direct
adjusted against retained earnings. disposal of related assets or liabilities by the invested
entity, other changes in shareholders’ equity except
Business combinations not involving entities net profit or loss, other comprehensive income and
under common control profit distribution shall be transferred to income for the
period in which the acquisition date falls. Where the
A business combination not involving entities under
equity instrument investments are held in the acquiree
common control is a business combination in which all
before the acquisition date, the equity instrument are
of the combining entities are not ultimately controlled
investments accumulate changes in the fair value of
by the same party or parties both before and after the
other comprehensive income to retained earnings
combination. In a business combination not involving
before the acquisition date.
entities under common control, the entity that, on the
acquisition date, obtains control of another combining 5. Consolidated financial statements
entity is the acquirer, while that other combining entity
is the acquiree. The acquisition date is the date on The scope of the consolidated financial statements,
which the acquirer effectively obtains control of the which include the financial statements of the Company
acquiree. and all of its subsidiaries, is determined on the basis
of control. Subsidiary refers to the entity controlled
The acquirer shall measure the acquiree’s identifiable by the company (including the divisible parts of the
assets, liabilities and contingent liabilities acquired in enterprises, the invested units, and the structured
the business combination at their fair values on the entities controlled by the company, etc).
acquisition date.
In the preparation of the consolidated financial
Goodwill is initially recognised and measured at cost, statements, where the accounting policies of a
being the excess of the aggregate of the fair value subsidiary are different from those of the Company
of the consideration transferred (or the fair value of have made adjustments to the financial statements
the equity securities issued) and any fair value of of the subsidiary based on the Company’s own
the Group’s previously held equity interest in the accounting policies, Where the accounting period of
acquiree over the Group’s interest in the fair value a subsidiary is different from that of the Company, the
of the acquiree’s net identifiable assets. After initial Company has adjusted the financial statements of the
recognition, goodwill is measured at cost less any subsidiary based on the Company’s own accounting
accumulated impairment losses. Where the aggregate period. All intra-group assets, liabilities, equity, income,
of the fair value of the consideration transferred (or expenses and cash flows relating to transactions
the fair value of the equity securities issued) and any between members of the Group are eliminated in full on
fair value of the Group’s previously held equity interest consolidation.
in the acquiree is lower than the Group’s interest in
the fair value of the acquiree’s net identifiable assets, Where the loss for the current period attributable
the Group reassesses the measurement of the fair to non-controlling interests of a subsidiary exceeds
value of the acquiree’s identifiable assets, liabilities the non-controlling interests of the opening balance
and contingent liabilities and the fair value of the of equity of the subsidiary, the excess shall still be
consideration transferred (or the fair value of the equity allocated against the non-controlling interests.
securities issued), together with the fair value of the

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

For subsidiaries acquired through business 8. Foreign currency transactions and foreign
combinations not involving entities under common
currency translation
control, the financial performance and cash flows of
the acquiree shall be consolidated from the date on The Group translates foreign currency transactions into
which the Group obtains control, and continue to be its functional currency.
consolidated until the date such control ceases. While Foreign currency transactions are initially recorded,
preparing the consolidated financial statements, the on initial recognition in the functional currency using
Group shall adjust the subsidiary’s financial statements, the spot exchange rates prevailing at the dates of
on the basis of the fair values of the identifiable assets, transactions in which the transactions occur. Monetary
liabilities and contingent liabilities recognised on the items denominated in foreign currencies are translated
acquisition date. at the spot exchange rates ruling at the balance sheet
For subsidiaries acquired through business date. Differences arising on settlement or translation
combinations involving entities under common of monetary items are recognised in profit or loss, with
control, the financial performance and cash flows of the exception of those relating to foreign currency
the entity being absorbed shall be consolidated from borrowings specifically for the construction and
the beginning of the period in which the combination acquisition of qualifying assets, which are capitalised
occurs. While preparing the comparative financial in accordance with the guidance for capitalisation
statements, adjustments are made to related items of borrowing costs. Non-monetary items that are
in the financial statements for the prior period as if measured in terms of historical cost in a foreign
the reporting entity after the combination has been in currency are translated using the exchange rates at
existence since the date the ultimate controlling party the dates of the initial transactions, and the amount
first obtained the control. denominated in the functional currency is not changed.
Non-monetary items measured at fair value in a foreign
The Group reassesses whether or not it controls an
currency are translated using the exchange rates at the
investee if any changes in facts and circumstances
date when the fair value was measured. The resulting
indicate that there are changes to one or more of the
exchange differences are recognised in profit or loss or
three elements of control.
other comprehensive income depending on the nature
A change in the non-controlling interests, without a loss of the non-monetary items.
of control, is accounted for as an equity transaction.
For foreign operations, the Group translates their
If the accounting treatment of a transaction is functional currency amounts into RMB when preparing
inconsistent in the financial statements at the Group the financial statements as follows: as at the balance
level and at the Company or its subsidiary level, sheet date, the assets and liabilities are translated
adjustment will be made from the perspective of the using the spot exchange rates at the balance sheet
Group. date, and equity items other than “unappropriated
profit” are translated at the spot exchange rates at the
6. Classification of joint arrangement and joint dates of transactions; revenue and expense items in
operation profit or loss are translated using the spot exchange
rates prevailing on the dates of the transactions. The
A joint arrangement is classified as either a joint
resulting exchange differences are recognised in
operation or a joint venture. A joint operation is a joint
other comprehensive income. On disposal of a foreign
arrangement whereby the joint operators have rights to
operation, the component of other comprehensive
the assets, and obligations for the liabilities, relating to
income relating to that particular foreign operation
the arrangement. A joint venture is a joint arrangement
is recognised in profit or loss. If the disposal only
whereby the joint operators have rights to the net
involves a portion of a particular foreign operation, the
assets of the arrangement.
component of other comprehensive income relating to
A joint operator recognises the following items in that particular foreign operation is recognised in profit
relation to its interest in a joint operation: its solely- or loss on a pro-rata basis.
held assets and its share of any assets held jointly; its
Foreign currency cash flows and the cash flows of
solely-assumed liabilities and its share of any liabilities
foreign subsidiaries are translated using the spot
incurred jointly; its revenue from the sale of its share
exchange rates prevailing on the dates of cash flows.
of the output arising from the joint operation; its share
The effect of exchange rate changes on cash is
of the revenue from the sale of the output by the joint
separately presented as an adjustment item in the
operation; its solely-incurred expenses and its share of
statement of cash flows.
any expenses incurred jointly.

7. Cash and cash equivalents

Cash comprises the Group’s cash on hand and bank
deposits that can be readily withdrawn on demand.
Cash equivalents are short-term, highly liquid
investments that are readily convertible into known
amounts of cash, and are subject to an insignificant
risk of changes in value.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

9. Financial instruments Financial assets are measured at fair value on

initial recognition, but accounts receivable or notes
A financial instrument is any contract that gives rise to
receivable arising from the sale of goods or rendering
a financial asset of one entity and a financial liability or
of services that do not contain significant financing
equity instrument of another entity.
components or for which the Group has applied the
Recognition and derecognition practical expedient of not adjusting the effect of a
significant financing component due within one year,
The Group recognises a financial asset or a financial are initially measured at the transaction price.
liability when it becomes a party to the contractual
provisions of a financial instrument. For financial assets at fair value through profit or loss,
relevant transaction costs are directly recognised in
A financial asset (or, where applicable, a part of a profit or loss, and transaction costs relating to other
financial asset or part of a group of similar financial financial assets are included in the initial recognition
assets) is primarily derecognised (i.e., removed from amounts.
the Group’s consolidated balance sheet) when:
The subsequent measurement of financial assets
(1) the rights to receive cash flows from the depends on their classification as follows:
financial asset have expired; or
(2) the Group has transferred its rights to Debt investments measured at amortised cost
receive cash flows from the financial asset,
The Group measures financial assets at amortised cost
or has assumed an obligation to pay the
if both of the following conditions are met: the financial
received cash flows in full without material
asset is held within a business model with the objective
delay to a third party under a “pass-through”
to hold financial assets in order to collect contractual
arrangement; and either (a) has transferred
cash flows; the contractual terms of the financial asset
substantially all the risks and rewards of the
give rise on specified dates to cash flows that are solely
financial asset, or (b) has neither transferred
payments of principal and interest on the principal
nor retained substantially all the risks and
amount outstanding. Financial assets at amortised cost
rewards of the asset, but has transferred
are subsequently measured using the effective interest
control of the financial asset.
method and are subject to impairment. Gains and
A financial liability is derecognised when the obligation losses are recognised in profit or loss when the asset is
under the liability is discharged, cancelled, or derecognised, modified or impaired.
expired. When an existing financial liability is replaced
by another from the same lender on substantially Debt investments at fair value through other
different terms, or the terms of an existing liability
comprehensive income
are substantially modified, such an exchange or
modification is treated as a derecognition of the original The Group measures debt investment held at fair
liability and a recognition of a new liability, and the value through other comprehensive income if both of
difference between the respective carrying amounts is the following conditions are met: the financial asset is
recognised in profit or loss. held within a business model with the objective of both
Regular way purchases and sales of financial assets holding to collect contractual cash flows and selling;
are recognised and derecognised using trade date the contractual terms of the financial asset give rise on
accounting. Regular way purchases and sales are specified dates to cash flows that are solely payments
purchases or sales of financial assets that require of principal and interest on the principal amount
delivery within the period generally established by outstanding. Interest income is recognised using
regulation or convention in the marketplace. The trade the effective interest method. The interest income,
date is the date that the Group committed to purchase impairment losses and foreign exchange revaluation
or sell a financial asset. are recognised in profit or loss. The remaining fair
value changes are recognised in other comprehensive
Classification and measurement of financial income. Upon derecognition, the cumulative fair value
change recognised in other comprehensive income is
assets
recycled to profit or loss.
The classification of financial assets at initial recognition
depends on the financial asset’s contractual cash Equity investments at fair value through other
flow characteristics and the Group’s business model
comprehensive income
for managing them: financial assets at fair value
through profit or loss, financial assets at amortised The Group can elect to classify irrevocably its equity
cost and financial assets at fair value through other investments which are not held for trading as equity
comprehensive income. All affected related financial investments designated at fair value through other
assets will be reclassified only if the Group changes its comprehensive income. Only the relevant dividend
business model for managing financial assets. income (excluding the dividend income explicitly
recovered as part of the investment cost) is recognised
in profit or loss. Subsequent changes in the fair value
are included in other comprehensive income, and no
impairment allowance is made. When the financial
asset is derecognised, the accumulated gains or losses
previously included in other comprehensive income
are transferred from other comprehensive income to
retained earnings.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Financial assets at fair value through profit or loss For accounts receivable and contract assets excluding
significant financing components, the Group applies
The financial assets other than the above financial
the simplified approach to recognise a loss allowance
assets measured at amortised cost and financial assets
based on lifetime ECLs.
at fair value through other comprehensive income
are classified as financial assets at fair value through For accounts receivable and contract assets including
profit or loss. Such financial assets are subsequently significant financing components and lease receivable,
measured at fair value with net changes in fair value the Group applies the simplified approach to recognise
recognised in profit or loss. a loss allowance based on lifetime ECLs.
Except for financial assets which apply the simplified
Classification and measurement of financial
approach as mentioned above, other financial assets,
liabilities and financial guarantee contracts, the Group assesses
The Group’s financial liabilities are, on initial whether the credit risk has increased significantly
recognition, classified into financial liabilities at fair since initial recognition at each end of the reporting
value through profit or loss, or other financial liabilities. period. If the credit risk has not increased significantly
For financial liabilities at fair value through profit or loss, since initial recognition (stage 1), the loss allowance is
relevant transaction costs are directly recognised in measured at an amount equal to 12-month ECLs by the
profit or loss, and transaction costs relating to other Group and the interest income is calculated according
financial liabilities are included in the initial recognition to the carrying amount and the effective interest rate;
amounts. if the credit risk has increased significantly since initial
recognition but are not credit-impaired (stage 2), the
The subsequent measurement of financial liabilities loss allowance is measured at an amount equal to
depends on their classification as follows: lifetime ECLs by the Group and the interest income
is calculated according to the carrying amount and
Financial liabilities at fair value through profit or the effective interest rate; if such financial assets are
loss credit-impaired after initial recognition (stage 3), the
loss allowance is measured at an amount equal to
Financial liabilities at fair value through profit or loss lifetime ECLs by the Group and the interest income
consist of financial liabilities held for trading (including is calculated according to the amortised cost and
derivative instruments that are financial liabilities) and the effective interest rate. If the credit risk of financial
those designated upon initial recognition as at fair instruments is low at the end of the reporting period, the
value through profit or loss. Financial liabilities held Group assumes that the credit risk has not increased
for trading (including derivative instruments that are significantly since initial recognition.
financial liabilities) are subsequently measured at
fair value. All changes in fair value of such financial The Group assesses the expected credit loss of
liabilities are recognised in profit or loss. Financial financial instruments based on individual and portfolio.
liabilities designated at fair value through profit or loss Taking into account the credit risk characteristics of
are subsequently measured at fair value and gains or different customers, the Group evaluates the expected
losses are recognised in profit or loss, except for the credit loss of accounts receivable and contract assets
gains or losses arising from the Group’s own credit risk on the basis of ageing portfolio.
which are presented in other comprehensive income. If In case the ECLs of individually assessed accounts
gains or losses arising from the Group’s own credit risk receivable and contract assets cannot be evaluated
which are presented in other comprehensive income with reasonable cost, the Group divides accounts
will lead to or expand accounting mismatch in profit receivable and contract assets into certain groupings
or loss, the Group will include all the changes in fair based on credit risk characteristics, and calculates
value (including the amount affected by changes in the the ECLs of the groupings of accounts receivable. The
Group’s own credit risk) of such financial liabilities in groupings of accounts receivable are as follows:
profit or loss.
Grouping 1 Due from government, authorities and
Other financial liabilities central state-owned enterprises
For such financial liabilities, the effective interest rate Grouping 2 Due from overseas and enterprises
method is adopted and the subsequent measurement
is carried out according to the amortized cost. Grouping 3 Due from other customers

Impairment of financial assets

Based on the expected credit losses (“ECLs”), the
Group recognises an allowance for ECLs for the
financial assets measured at amortised cost, debt
investments at fair value through other comprehensive
income, contract assets, and financial guarantee
contracts.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

The Group, with consideration to historical credit loss The Group’s judgement criteria for a significant
experience, current conditions and forecasts of future increase of credit risk, the definition of credit-impaired
economic conditions, prepares the cross-reference assets, and the assumptions on the measurement of
between the ageing of accounts receivable and the expected credit losses are disclosed in Note VIII. 3.
lifetime ECLs rates, and calculates the ECLs of the
When the Group no longer reasonably expects to be
groupings of contract assets. The groupings of contract
able to recover all or part of the contractual cash flows
assets are as follows:
of a financial asset, the Group directly writes down the
Grouping 1 Engineering projects carrying amount of the financial asset.

Grouping 2 Real estate projects Offsetting of financial instruments

Grouping 3 Unmatured warranties Financial assets and financial liabilities are offset and
the net amount is reported in the balance sheet if
Grouping 4 PPP projects which are managed in the there is a currently enforceable legal right to offset the
model of financial assets recognised amounts; and there is an intention to settle
Grouping 5 Primary land development projects on a net basis, or to realise the assets and settle the
liabilities simultaneously.
Grouping 6 Other contract assets
Financial guarantee contracts
Based on the exposure at default and the lifetime ECLS
rate, the Group calculates the ECLS of contract assets Financial guarantee contracts are those contracts
that are classified into groupings with consideration to that require a payment to be made by the issuer to
historical credit losses experience, current conditions reimburse the holder for a loss it incurs because the
and forecasts of future economic conditions. specified debtor fails to make a payment when due
in accordance with the terms of a debt instrument.
For long-term receivables arising from sales of goods Financial guarantee contracts are measured, on initial
or rendering of services in the ordinary course of recognition, at fair value. For financial guarantee
the activities, such as receivables for PPP projects, contracts that are not designated as financial liabilities
receivables for BT projects, receivables for primary land at fair value through profit or loss, they are, after initial
development, and receivables for other infrastructure recognition, subsequently measured at the higher of: (i)
projects, the Group calculates the ECLs through default the amount of provisions for ECLs at the balance sheet
risk exposure and the lifetime ECLs rate, on the basis of date, and (ii) the amount initially recognised less the
historical credit loss experience, the current conditions cumulative amortisation recognised in accordance with
and forecasts of future economic conditions. Based on the guidance for revenue recognition.
the exposure at default and the 12-month/lifetime ECLs
rate, the Group calculates the ECLs of other long-term Transfer of financial assets
receivables with consideration of historical credit loss
A financial asset is derecognised when the Group
experience, the current conditions and forecasts of
has transferred substantially all the risks and rewards
future economic conditions.
of the asset to the transferee. A financial asset is not
In the case where the ECLs of other receivables derecognised when the Group retains substantially all
individually assessed cannot be evaluated the risks and rewards of the financial asset.
with reasonable cost, the Group divides other
When the Group has neither transferred nor retained
receivables into certain groupings based on credit
substantially all the risks and rewards of the financial
risk characteristics, and calculates the ECLs for the
asset, it either (i) derecognises the financial asset and
groupings. The groupings of other receivables are as
recognises the assets and liabilities created in the
follows:
transfer when it has not retained control of the asset; or
Grouping 1 Guarantees, deposits and reserves (ii) continues to recognise the transferred asset to the
extent of the Group’s continuing involvement, in which
receivables
case, the Group also recognises an associated liability.
Grouping 2 Advances receivable
Continuing involvement that takes the form of a
Grouping 3 Other receivables guarantee over the transferred financial asset is
measured at the lower of the original carrying amount
The Group, on the basis of the exposure at default and of the financial asset and the guarantee amount.
the 12-month/lifetime ECLs rate, calculates the ECLs The guarantee amount is the maximum amount of
of other receivables that are classified into groupings consideration that the Group could be required to
with consideration to historical credit loss experience, repay.
the current conditions and forecasts of future economic
conditions.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

10. Inventories 11. Long-term equity investments

The inventories include inventories of raw materials, Long-term equity investments include equity
work in progress, finished goods, turnover materials, investments in subsidiaries, joint ventures and
properties under development and completed associates.
properties for sale.
A long-term equity investment is initially measured at
Inventories are initially carried at cost. Cost of its initial investment cost on acquisition. For a long-
inventories comprises all costs of purchase, laid down term equity investment acquired through a business
cost, costs of conversion and other costs. combination involving entities under common control,
the initial investment cost of the long-term equity
Cost is determined using the first-in first-out or
investment is the acquirer’s share of the carrying value
weighted average method when raw materials, turnover
of shareholder’s equity of the party being absorbed at
materials, work in progress and finished goods are
the combination date. For the difference between the
delivered. The cost of finished goods and work in
initial investment cost and the book value of the merger
progress comprises raw materials, direct labour and
consideration, the capital reserve shall be adjusted (if
systematically allocated production overhead based on
it is not enough to offset, the retained earnings shall
the normal production capacity.
be offset); for other comprehensive income before
Properties under development and completed the merger date, the accounting treatment shall be
properties for sale mainly include costs for acquiring conducted on the same basis as the direct disposal
the land use rights, expenditures of basic facilities, of relevant assets or liabilities by the investee, The
expenditures of construction and installation work, shareholder’s equity recognized due to changes in
borrowing costs incurred before the completion of other shareholders’ equity of the investee other than net
development. Properties under development will be profit and loss, other comprehensive income and profit
carried forward to the completed properties for sale distribution shall be transferred to the current profit and
according to the actual cost after the completion of the loss when the investment is disposed of; among them,
project, completed properties for sale are measured at the long-term equity investment after disposal shall be
actual cost. carried forward proportionally, and that converted into
Turnover materials are amortised based upon numbers financial instruments after disposal shall be carried
of usage. forward in full. For a long-term equity investment
through a business combination not involving entities
The Group adopts the perpetual inventory system. under common control, the initial investment cost of the
At the end of the reporting period, inventories are long-term equity investment is the cost of combination
stated at the lower of cost and net realisable value. (for a business combination not involving entities under
The inventories are written down below cost to net common control achieved in stages that involves
realisable value and the write-down is recognised in multiple exchange transactions, the initial investment
profit or loss if the cost is higher than the net realisable cost is carried at the aggregate of the carrying amount
value. When the circumstances that previously caused of the acquirer’s previously held equity interest in the
the inventories to be written down below cost no acquiree and the new investment cost incurred on
longer exist, in which case the net realisable value of the acquisition date), the cost of combination is the
inventories becomes higher than the carrying amount, aggregate of the fair values, at the acquisition date,
the amount of the write-down is reversed. The reversal of the assets given, liabilities incurred or assumed,
is limited to the amount of the original write-down, and and equity securities issued by the acquirer; For other
is recognised in profit or loss. comprehensive income held before the acquisition date
and recognized by the equity method, the accounting
Net realisable value is the estimated selling price in the
treatment shall be carried out on the same basis as
ordinary course of business less the estimated costs
the direct disposal, relevant assets or liabilities by the
of completion and the estimated costs necessary to
investee, and the shareholder’s equity recognized due
make the sale and relevant taxes. For inventories with
to changes in other shareholders’ equity of the investee
large quantity and low values, provision for decline in
other than net profit and loss, other comprehensive
value is made based on categories of inventories, and
income and profit distribution, When the investment
other inventories are written down item by category.
is disposed, it is transferred to the current profit and
Items of inventories relating to the same product line
loss; among them, the long-term equity investment
that have the same or similar end uses or purposes,
after disposal is carried forward proportionally, and the
are produced and marketed in the same geographical
financial instrument converted after disposal is carried
area, and cannot be practicably evaluated separately
forward in full; the accumulated fair value change of
from other items in that product line, are grouped and
the equity investment held before the purchase date as
written down on an aggregate basis.
a financial instrument included in other comprehensive
income is transferred to retained earnings when
accounting by cost method. For a long-term equity
investment acquired otherwise than through a business
combination, the initial investment cost is determined as
follows: for a long-term equity investment acquired by
cash, the initial investment cost is the actual purchase
price paid and direct costs, taxes and other necessary

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

expenditures directly attributable to the acquisition in the associates or joint ventures (except for assets
of the long-term equity investment; for a long-term that constitute a business) (However, any loss arising
equity investment acquired by the issue of equity from such transactions which are attributable to an
securities, the initial investment cost is the fair value of impairment loss shall be recognised at its entirety). The
the securities issued; for a long-term equity investment carrying amount of the investment is reduced based
acquired through exchange of non-monetary assets, on the Group’s share of any profit distributions or cash
the initial investment cost is determined in accordance dividends declared by the investee. The Group’s share
with Accounting Standard for Business Enterprises No. of net losses of the investee is recognised to the extent
7 – Exchange of Non-monetary Assets; for a long-term that the carrying amount of the investment together
equity investment acquired through debt restructuring, with any long-term interests that in substance form part
the initial investment cost is determined in accordance of its net investment in the investee is reduced to zero,
with Accounting Standard for Business Enterprises No. except that the Group has the obligations to assume
12 – Debt Restructuring. further losses. The Group’s share of the investee’s
equity changes, other than those arising from the
For a long-term equity investment where the Company
investee’s profit or loss, other comprehensive income
can exercise control over the investee, the long-term
or profit distribution, is recognised in the Group’s
investment is accounted for using the cost method in
equity, and the carrying amount of the long-term equity
the Company’s individual financial statements. Control
investment is adjusted accordingly.
is achieved when the Group is exposed, or has rights,
to variable returns from its involvement with the investee Upon disposal of a long-term equity investment, the
and has the ability to affect those returns through its difference between the proceeds actually received
power over the investee. and the carrying amount is recognised in profit or
loss. For a long-term equity investment accounted for
Under the cost method, the long-term equity
using the equity method, when the Group discontinues
investment is measured at its initial investment cost.
using the equity method due to disposal, all amounts
When additional investment is made or the investment
previously recognised in other comprehensive income
is recouped, the cost of long-term equity investment
are accounted for on the same basis as would have
is adjusted accordingly. Cash dividends or profit
been required if the investee had directly disposed
distributions declared by the investee are recognised
of the related assets or liabilities. Equity previously
as investment income in profit or loss.
recognised resulting from the investee’s equity
The equity method is adopted when the Group has changes other than profit or loss, other comprehensive
joint control, or exercises significant influence over income and profit distribution is reclassified to profit or
the investee. Joint control is the contractually agreed loss in its entirety. When the Group continues to use
sharing of control of an arrangement, which exists only the equity method, the amounts previously recognised
when decisions about the relevant activities require in other comprehensive income are accounted for on
the unanimous consent of the parties sharing control. the same basis as would have been required if the
Significant influence is the power to participate in the investee had directly disposed of the related assets
financial and operating policy decisions of the investee, or liabilities and reclassified to profit or loss on a pro-
but is not control or joint control with other parties over rata basis. Equity previously recognised resulting from
those policies. the investee’s equity changes other than profit or loss,
Under the equity method, where the initial investment other comprehensive income and profit distribution is
cost of a long-term equity investment exceeds the reclassified to profit or loss on a pro-rata basis.
Group’s interest in the fair value of the investee’s If the equity investment in the subsidiary is disposed of
identifiable net assets at the acquisition date, no step by step through multiple transactions until losing
adjustment is made to the initial investment cost. Where control, and it belongs to a package transaction, each
the initial investment cost is less than the Group’s transaction will be treated as a transaction for disposing
interest in the fair values of the investee’s identifiable the subsidiary and losing control; However, the
net assets at the acquisition date, the difference is difference between the price of each disposal before
charged to profit or loss, and the cost of the long-term the loss of control and the book value of the long-
equity investment is adjusted accordingly. term equity investment corresponding to the disposed
Under the equity method, after it has acquired a long- equity is recognised as other comprehensive income in
term equity investment, the Group recognises its share individual financial statements, and will be transferred
of the investee’s profit or loss, as well as its share of the to the profit and loss of the current period when the
investee’s other comprehensive income, as investment control is lost. If it is not a package transaction, each
income or loss and other comprehensive income, transaction shall be accounted for separately. If the
and adjusts the carrying amount of the investment control is lost, in the individual financial statements,
accordingly. The Group recognises its share of the if the residual equity after disposal can exercise
investee’s profit or loss after making appropriate joint control or significant influence on the original
adjustments to the investee’s profit or loss based on subsidiary, it will be recognised as a long-term equity
the fair value of the investee’s identifiable assets at investment, which will be accounted for according to
the acquisition date, using the Group’s accounting the relevant provisions of the relevant cost method to
policies and periods. Unrealised profits and losses the equity method; Otherwise, it is recognised as a
from transactions with its joint ventures and associates financial instrument, and the difference between the fair
are eliminated to the extent of the Group’s investments value and the book value on the date of loss of control
is included in the current profits and losses.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

12. Investment properties The Group reviews the useful life and estimated net
residual value of a fixed asset and the depreciation
Investment properties are properties held to earn rental
method applied at least at each year end, and make
income and/or for capital appreciation. Investment
adjustments if necessary.
properties include land use rights leased out, land use
rights held for transfer upon capital appreciation, and 14. Construction in progress
buildings leased out.
The cost of construction in progress is determined
An investment property is measured initially at cost. according to the actual expenditures incurred for the
If the economic benefits relating to an investment construction, including all necessary construction
property will probably flow in and the cost can be expenditures incurred during the construction period,
reliably measured, subsequent costs incurred for the borrowing costs that shall be capitalised before the
property are included in the cost of the investment construction is ready for its intended use, and other
property. Otherwise, subsequent costs are recognised relevant expenditures.
in profit or loss as incurred.
Construction in progress is transferred to fixed assets
The Group uses the cost model for the subsequent when it is ready for its intended use.
measurement of its investment properties. Buildings
and land use rights are depreciated or amortised 15. Borrowing costs
according to their service life and estimated net
Borrowing costs are interest and other costs incurred
residual values rate.
by the Group in connection with the borrowing of the
13. Fixed assets funds. Borrowing costs include interest, amortisation of
discounts or premiums related to borrowings, ancillary
A fixed asset is recognised only when the economic costs incurred in connection with the arrangement of
benefits associated with the asset will probably flow borrowings, and exchange differences arising from
into the Group and the cost of the asset can be foreign currency borrowings.
measured reliably. Subsequent expenditures incurred
for a fixed asset that meets the recognition criteria The borrowing costs that are directly attributable to the
shall be included in the cost of the fixed asset, and the acquisition, construction or production of a qualifying
carrying amount of the component of the fixed asset asset are capitalised. The amounts of other borrowing
that is replaced shall be derecognised. Otherwise, costs incurred are recognised as an expense in the
such expenditures are recognised in profit or loss as period in which they are incurred. Qualifying assets are
incurred. assets that necessarily take a substantial period of time
of acquisition, construction or production to get ready
Fixed assets are initially measured at cost. The cost of for their intended use or sale.
a purchased fixed asset comprises the purchase price,
relevant taxes and any directly attributable expenditure The capitalisation of borrowing costs commences only
for bringing the asset to working condition for its when all of the following conditions are satisfied:
intended use. (1) expenditures for the asset have been incurred;
In addition to the safety production expenses extracted, (2) borrowing costs have been incurred; and
depreciation of fixed assets is calculated using the
(3) activities that are necessary to acquire,
straight-line method. The useful lives, estimated net
construct or produce the asset for its intended
residual value rates and annual depreciation rates of
use or sale have been undertaken.
each category of the fixed assets are as follows:

Estimated net residual Annual

Useful life value rate depreciation rate
Buildings 8 to 35 years 0% to 5% 2.71% to 12.50%
Machinery and equipment 5 to 14 years 0% to 5% 6.79% to 20.00%
Motor vehicles 3 to 10 years 0% to 5% 9.50% to 33.33%
Office equipment, temporary facilities
5 to 10 years 0% to 5% 9.50% to 20.00%
 and others

Fixed assets that are held under finance leases are Capitalisation of borrowing costs ceases when the
depreciated by applying the same policy as that for qualifying asset being acquired, constructed or
the fixed assets owned by the Group. If it can be produced gets ready for its intended use or sale. Any
reasonably determined that the ownership of the borrowing costs subsequently incurred are recognised
leased asset can be obtained at the end of the lease in profit or loss.
term, the leased asset is depreciated over its useful
life; otherwise, the leased asset is depreciated over the
shorter of the lease term and its useful life.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

During the capitalisation period, the amount of interest The Group is involved in a number of service
eligible for capitalisation for each accounting period franchising arrangements. The Group carries out
shall be determined as follows: infrastructure projects for the licensor in accordance
with the preconditions set by the licensor in exchange
(1) where funds are borrowed specifically for the
for the right to operate the relevant assets. Prescribed
purpose of obtaining a qualifying asset, the
in the contract after the completion of the infrastructure,
amount of interest eligible for capitalisation
the group is engaged in business have rights to
is the actual interest costs incurred on that
access the service object for a certain period of time of
borrowing for the period less any bank
charge, charge amount is uncertain, this right does not
interest earned from depositing the borrowed
constitute an unconditional charge can determine the
funds before being used on the asset or any
amount of money or the rights of other financial assets,
investment income on the temporary investment
while affirm income confirmation of intangible assets.
of those funds; or
The Group will present the franchise acquired under
(2) where funds are borrowed generally for the such franchise arrangement as an intangible asset
purpose of obtaining a qualifying asset, the on its balance sheet. Upon completion of the relevant
amount of interest eligible for capitalisation is infrastructure project under the franchise arrangement,
determined by applying a weighted average the franchise shall be amortized on a straight-line basis
interest rate on the general borrowings to during the franchise period.
the weighted average of the excess of the
An intangible asset with a finite useful life is amortised
cumulative expenditures on the asset over
using the straight-line method over its useful life. For
the expenditures on the asset funded by the
an intangible asset with a finite useful life, the Group
specific borrowings.
reviews the useful life and amortisation method at least
Capitalisation of borrowing costs is suspended at each year end and makes adjustment if necessary.
during periods in which the acquisition, construction
The Group classifies the expenditures on an internal
or production of a qualifying asset is suspended
research and development project into expenditure
abnormally by activities other than those necessary to
on the research phase and expenditure on the
get the asset ready for its intended use or sale, when
development phase. Expenditure on the research
the suspension is for a continuous period of more
phase is recognised in profit or loss as incurred.
than 3 months. Borrowing costs incurred during these
Expenditure on the development phase is capitalised
periods are recognised as an expense in profit or
only when the Group can demonstrate all of the
loss until the acquisition, construction or production is
following: (i) the technical feasibility of completing the
resumed.
intangible asset so that it will be available for use or
16. Intangible assets sale; (ii) the intention to complete the intangible asset
and use or sell it; (iii) how the intangible asset will
An intangible asset shall be recognised only when generate probable future economic benefits (among
it is probable that the economic benefits associated other things, the Group can demonstrate the existence
with the asset will flow to the Group and the cost of the of a market for the output of the intangible asset or the
asset can be measured reliably. Intangible assets are intangible asset itself or, if it is to be used internally, the
measured initially at cost. However, intangible assets usefulness of the intangible asset); (iv) the availability
acquired in a business combination not involving of adequate technical, financial and other resources
entities under common control with a fair value that can to complete the development and the ability to use or
be measured reliably are recognised separately as sell the intangible asset; and (v) the ability to measure
intangible assets and initially measured at the fair value reliably the expenditure attributable to the intangible
at the date of acquisition. asset during the development phase. Expenditure on
The useful life of an intangible asset is determined the development phase which does not meet these
according to the period over which it is expected above criteria is recognised in profit or loss when
to generate economic benefits for the Group. An incurred.
intangible asset is regarded as having an indefinite
useful life when there is no foreseeable limit to the 17. Impairment of assets
period over which the asset is expected to generate The Group determines the impairment of assets, other
economic benefits for the Group. than the impairment of inventories, contract assets
Land use rights that are purchased by the Group are and contract cost assets, deferred tax assets, financial
accounted for as intangible assets. Buildings, such assets, using the following methods:
as plants that are developed and constructed by the
Group, and relevant land use rights are accounted for
as fixed assets and intangible assets, respectively.
Payments for the land and buildings purchased
are allocated between the land use rights and the
buildings; they are accounted for as fixed assets if they
cannot be reasonably allocated.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

The Group assesses at the end of the reporting period 18. Long-term prepaid expenses
whether there is any indication that an asset may be
Long-term prepaid expenses include the expenditure
impaired. If any indication exists that an asset may
for improvements to fixed assets held under operating
be impaired, the Group estimates the recoverable
leases, and other expenditures that have been incurred
amount of the asset and performs impairment testing.
but should be recognised as expenses over more than
Goodwill arising from a business combination and an
one year in the current and subsequent periods. Long-
intangible asset with an indefinite useful life are tested
term prepaid expenses are amortised on the straight-
for impairment at least at each year end, irrespective
line basis over the expected beneficial period and are
of whether there is any indication that the asset may be
presented at actual expenditure net of accumulated
impaired. Intangible assets that have not been ready
amortisation.
for their intended use are tested for impairment each
year. 19. Employee benefits
The recoverable amount of an asset is the higher of Employee benefits refer to all forms of consideration or
its fair value less costs to sell and the present value of compensation other than share-based payments given
the future cash flows expected to be derived from the by the Group in exchange for services rendered by
asset. The Group estimates the recoverable amount on employees or for termination of employment. Employee
an individual basis unless it is not possible to estimate benefits include short-term employee benefits, post-
the recoverable amount of the individual asset, in which employment benefits, termination benefits and other
case the recoverable amount is determined for the long-term employee benefits. Benefits given by
asset group to which the asset belongs. Identification of the Group to an employee’s spouse, children and
an asset group is based on whether major cash inflows dependents, family members of deceased employees
generated by the asset group are largely independent and other beneficiaries are also employee benefits.
of the cash inflows from other assets or asset groups.
When the recoverable amount of an asset or asset Short-term employee benefits
group is less than its carrying amount, the carrying The short-term employee benefits actually occurred
amount is reduced to the recoverable amount by the are recognised as a liability in the accounting period
Group. The reduction in the carrying amount is treated in which the service is rendered by the employees,
as an impairment loss and recognised in profit or loss. with a corresponding charge to the profit or loss for the
A impairment allowance loss of the asset is recognised current period or the cost of relevant assets.
accordingly.
Post-employment benefits (defined contribution
For the purpose of impairment testing, the carrying
amount of goodwill acquired in a business combination plan)
is allocated from the acquisition date on a reasonable The employees of the Group participate in a pension
basis, to each of the related asset groups unless it is scheme and unemployment insurance managed by the
impossible to allocate to the related asset groups, in local government, and an enterprise pension fund, the
which case it is allocated to each of the related sets corresponding expenses shall be included in the cost
of asset groups. Each of the related asset groups or of related assets or profit or loss.
sets of asset groups is an asset group or a set of asset
groups that is expected to benefit from the synergies of Post-employment benefits (defined benefit plan)
the business combination and shall not be larger than The Group operates a defined benefit pension plan
a reportable segment determined by the Group. which requires contributions to be made to a separately
When testing an asset group (a set of asset groups) to administered fund. The benefits are unfunded. The cost
which goodwill has been allocated for impairment, if of providing benefits under the defined benefit plan is
there is any indication of impairment, the Group firstly determined using the projected unit credit method.
tests the asset group (set of asset groups), excluding Remeasurements arising from the defined benefit
the amount of goodwill allocated, for impairment, i.e., pension plan, comprising actuarial gains and losses,
the Group determines and compares the recoverable the effect of the asset ceiling (excluding amounts
amount with the related carrying amount and included in net interest on the net defined benefit
recognises any impairment loss. After that, the Group liability) and the return on plan assets (excluding
tests the asset group (set of asset groups), including amounts included in net interest on the net defined
goodwill, for impairment, the carrying amount of the benefit liability), are recognised immediately in the
related asset group (set of asset groups) is compared balance sheet with a corresponding debit or credit
to its recoverable amount. If the carrying amount of to equity through other comprehensive income in the
the asset group (set of asset groups) is higher than period in which they occur. Remeasurements are not
its recoverable amount, the amount of the impairment reclassified to profit or loss in subsequent periods.
loss is firstly used to reduce the carrying amount of
the goodwill allocated to the asset group (set of asset Past service costs are recognised in profit or loss at the
groups), and then used to reduce the carrying amount earlier of the date of the plan amendment and the date
of other assets (other than the goodwill) within the asset that the Group recognises restructuring-related costs
group (set of asset groups), on a pro-rata basis of the or termination benefits.
carrying amount of each asset.
Once the above impairment loss is recognised, it
cannot be reversed in subsequent accounting periods.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Net interest is calculated by applying the discount rate A provision is initially measured at the best estimate of
to the net defined benefit liability or asset. The Group the expenditure required to settle the related present
recognises the following changes in the net defined obligation, taking into account factors pertaining to a
benefit obligation under administrative expenses, and contingency such as the risks, uncertainties and time
finance expenses in the income statement: service value of money as a whole. Provisions are reviewed
costs comprising current service costs, past service at each balance sheet date. Where there is clear
costs, gains and losses on settlements; net interest evidence that the carrying amount of a provision does
comprising interest income on plan assets, interest not reflect the current best estimate, the carrying
costs on the defined benefit obligation and interest on amount is adjusted to the current best estimate.
the effect of the asset ceiling.
21. Share-based payments
Termination benefits A share-based payment is classified as either an
The Group provides termination benefits to employees equity-settled share-based payment or a cash-settled
and recognises an employee benefits liability for share-based payment. An equity-settled share-based
termination benefits, with a corresponding charge to payment is a transaction in which the Group receives
profit or loss, at the earlier of when the Group can no services and uses shares or other equity instruments
longer withdraw the offer of those benefits resulting as consideration for settlement.
from an employment termination plan or a curtailment
An equity-settled share-based payment in exchange
proposal and when the Group recognise costs
for services received from employees is measured at
involving the payment of termination benefits.
the fair value of the equity instruments granted to the
Early retirement benefits employees. If such equity-settled share-based payment
could vest immediately, related costs or expenses at
The Group offers early retirement benefits to those an amount equal to the fair value on the grant date are
employees who accept early retirement arrangements. recognised, with a corresponding increase in capital
The early retirement benefits refer to the salaries and reserve; if such equity-settled share-based payment
social security contributions to be paid to and for the could not vest until the completion of services for a
employees who accept voluntary retirement before the vesting period, or until the achievement of a specified
statutory retirement age, as approved by management. performance condition, the Group at each balance
The Group pays early retirement benefits to those early sheet date during the vesting period recognises the
retired employees from the early retirement date until services received for the current period as related
the normal retirement date. The Group accounts for costs and expenses, with a corresponding increase
the early retirement benefits in accordance with the in capital reserve, at an amount equal to the fair value
treatment for termination benefits, in which the salaries of the equity instruments at the grant date, based on
and social security contributions to be paid to and for the best estimate of the number of equity instruments
the early retired employees from the off-duty date to expected to vest, which is made on the basis of the
the normal retirement date are recognised as liabilities latest available information such as the changes in the
with a corresponding charge to the profit or loss for number of covered employees. The fair value of the
the current period. The differences arising from the Share Options was determined by the Binomial Options
changes in the respective actuarial assumptions of the Pricing Model, as stated in Note XI.
early retirement benefits and the adjustments of benefit
standards are recognised in profit or loss in the period The cost of equity-settled transactions is recognised,
in which they occur. together with a corresponding increase in capital
reserve, over the period in which the specified
The termination benefits expected to be settled within performance and service conditions are fulfilled. The
one year since the balance sheet date are classified as cumulative expense recognised for equity-settled
current liabilities. transactions at each end of the reporting period until
the vesting date reflects the extent to which the vesting
20. Provisions
period has expired and the Group’s best estimate of
An obligation related to a contingency shall be the number of equity instruments that will ultimately
recognised by the Group as a provision when all of the vest.
following conditions are satisfied, except for contingent
Where the terms of an equity-settled share-based
considerations and contingent liabilities assumed in
award are modified, as a minimum an expense is
a business combination not involving entities under
recognised as if the terms had not been modified. In
common control:
addition, an expense is recognised for any modification
(1) the obligation is a present obligation of the that increases the total fair value of the share-based
Group; payments, or is otherwise beneficial to the employee as
measured at the date of modification.
(2) it is probable that an outflow of economic
benefits from the Group will be required to
settle the obligation; and
(3) a reliable estimate can be made of the amount
of the obligation.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Where an equity-settled share-based award is 23. Revenue from contracts with customers
cancelled, it is treated as if it had vested on the date
Revenue from contracts with customers is recognised
of cancellation, and any expense not yet recognised
when the Group has fulfilled its performance
for the award is recognised immediately. This includes
obligations in the contracts, that is, when the customer
any award where non-vesting conditions within the
obtains control of relevant goods or services. Control of
control of either the Group or the employee are not
relevant goods or services refers to the ability to direct
met. However, if a new award is substituted for the
the use of the goods, or the provision of the services,
cancelled award, and is designated as a replacement
and obtain substantially all of the remaining benefits
on the date that it is granted, the cancelled and new
from the goods or services.
awards are treated as if they were a modification of the
original award. Construction contracts
22. Other equity instruments A construction contract between the Group and the
customer usually includes performance obligations of
Upon the maturity of the perpetual bonds issued by
housing construction and infrastructure construction.
the Group, the Group has the right to extend the term
Because the Group’s performance creates or enhances
indefinitely. For the coupon interest of the perpetual
an asset that the customer controls as the asset is
bonds, the Group has the right to defer payment. The
created or enhanced, the revenue is recognised over
Group has no contractual obligation to pay cash or
time only if the Group can reasonably measure its
other financial assets, which are classified as equity
progress towards the complete satisfaction of the
instruments.
performance obligation. The Group uses the input
The equity instruments such as non-cumulative method and determines the progress towards the
preference shares issued by the Group shall meet complete satisfaction of the rendering of services on
the following conditions at the same time: (1) it does the basis of costs incurred. If the progress towards the
not include the contractual obligation to deliver cash complete satisfaction of the performance obligation
or other financial assets to other parties or exchange cannot be reasonably measured, but the Group
financial assets or financial liabilities with other parties expects to recover the costs incurred in satisfying the
under potential adverse conditions; (2) the equity performance obligation, the revenue is recognised
instruments of the Group must be used or can be only to the extent of the costs incurred until such time
used for settlement. If it is a non derivative instrument, that the Group can reasonably measure the progress
the equity instrument of the Group shall be used for towards the complete satisfaction of the performance
settlement, the relevant financial instruments shall obligation.
not include the contractual obligation to deliver non
fixed amount of the group’s own equity instruments for Revenue from sales of real estate
settlement; in the case of derivative instruments, the The Group’s revenue from real estate development
relevant financial instruments can only be settled by business is recognised when the control over properties
exchanging a fixed amount of cash or other financial is transferred to the customer. According to the terms
assets with a fixed amount of the Group’s own equity under the sales contract and laws and regulations
instruments. Therefore, the Group will calculate them applicable to the contract, the control over properties
as other equity instruments. can be transferred within a certain period of time or at a
Th e div idend declar at ion and p a y m e n t o f t h e certain point of time. Where goods produced during the
Company’s preference shares shall be decided by Group’s performance of the contract are irreplaceable
the board of directors of the Company in accordance and the Group is entitled to collect payments for the
with the authorization of the general meeting of part of the performance that has been completed
shareholders. Prior to the ordinary shareholders, the so far during the entire contract period, revenue is
preference shareholders shall distribute the dividends recognised within a certain period of time based on the
prior to the ordinary shareholders, and the Company progress of performance obligation fulfilment during
shall not distribute profits to the shareholders of the contract period, and the progress of performance
ordinary shares until the agreed current dividend of obligation fulfilment is determined based on the
preference shares is fully distributed. The general proportion of contract costs incurred for the fulfilled
meeting of shareholders of the Company has the right performance obligations to the estimated total contract
to decide to cancel the payment of part or all of the costs. Otherwise, revenue is recognised when the
current dividends of the preference shares, which does customer obtains the physical ownership of goods or
not constitute a default of the Company. The preference the legal ownership of completed properties and the
shares is a non-cumulative dividend type preference Group obtains the present right to receive payment and
shares. The Company classifies the preference shares probably recovers the contract consideration.
as other equity instruments.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Revenue from design services Warranties

Due to the reason that the design services provided The Group provides a warranty in connection with
by the Group during the performance of contracts the sale of a good or the construction of an asset in
have irreplaceable uses, and the Group has the right accordance with the contract and the relevant laws and
to receive payments for the completed portions of the regulations, etc. For an assurance-type warranty that
projects during the entire contract period. Therefore, provides the customer the assurance that the goods
such services are accounted for as performance sold or the assets built complies with agreed-upon
obligations to be fulfilled within certain periods specifications, the Group accounts for the warranty
of time, and revenue is recognised based on the in accordance with Notes III.20. For a service-type
performance schedule, unless the performance of warranty that provides a customer with a service in
the contract cannot be reasonably determined. The addition to the assurance that the product complies
Group determines the performance progress for the with agreed-upon specifications, the Group accounts
services rendered by using the input method. Where for it as a separate performance obligation. On the
the performance of the contract cannot be reasonably basis of the relative proportion between the stand-
determined, revenue is recognised at the amount of alone selling price of the good and the service-type
costs incurred if it is predicted that the costs can be warranty, a portion of the transaction price is allocated
compensated till the performance progress can be to the service-type warranty and revenue is recognised
reasonably determined. when a customer obtained control of the good. When
assessing whether a service-type warranty provides
Contracts for the sale of goods a customer with a separate service in addition to
A contract for the sale of goods between the Group and the assurance that the good complies with agreed-
the customer usually only includes the performance upon specifications, the Group considers whether the
obligation to transfer the goods. The revenue is warranty is required by law, the length of the warranty
recognised at transfer control point in time based on coverage period and the nature of the tasks that the
the following indicators, which include: a present right Group promises to perform, etc.
to payment for goods, the transfer of significant risks
and rewards of ownership of goods, the transfer of
Contract modifications
legal title to goods, the transfer of physical possession When a modification is incurred in the construction
of goods, the customer’s acceptance of goods. contract between the Group and the customer:

Variable consideration (1) the Group accounts for a contract modification

as a separate contract if the construction
Some of the Group’s contracts with customers include services are distinct and price increases and
arrangements of variable consideration. The Group the increased price of the contract reflects
determines the best estimate of variable consideration the stand-alone selling prices of the additional
by using the expected value method or the most construction services;
likely amount method. However, the transaction price
including variable consideration is only to the extent (2) the Group accounts for the contract
that it is highly probable that a significant reversal in modification as if it were a termination of
the amount of cumulative revenue recognised will not the existing contract and by combining the
occur when the uncertainty associated with the variable unsatisfied and modified portion of the contract
consideration is subsequently resolved. as a new contract, if the contract modification
does not meet the criteria in (1) and the
Significant financing components remaining construction services are distinct
from the construction services transferred on
When the contract contains a significant financing
the date of the contract modification; or
component, the Group determines the transaction
price based on an amount that reflects the price that a (3) the Group accounts for the contract
customer would have paid for the goods or services in modification as if it were a part of the existing
cash at the time of obtaining the control of the goods contract if the contract modification does not
or services, and amortises the difference between the meet the criterion in (1) and the remaining
transaction price and the consideration promised in the construction services are not distinct from the
contract under the effective interest method within the construction services transferred at the date
contract period using the discount rate that discounts of the contract modification. The effect on
the nominal amount of the contract consideration to the recognised revenue is recognised as an
the current selling price of the goods or services. The adjustment to the revenue at the date of the
Group does not consider the effects of a significant contract modification.
financing component in the contract if it is expected
that the period between when the customer obtains
control of the goods or services and when the customer
pays for such goods or services will be one year or
less.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Recognition of revenue from Build-Operate- 24. Contract assets and contract liabilities
Transfer (“BOT”) The Group presents contract assets or contract
For BOT construction in progress, revenue from and liabilities depending on the relationship between the
costs for relevant construction services are recognised. satisfaction of its performance obligations and the
Revenue from construction services is measured at the customer’s payment in the balance sheet. The Group
considerations received or receivable, and contract offsets the contract assets and contract liabilities under
assets or intangible assets are recognised when the the same contract and presents the net amount.
revenue is recognised, with the significant financing
Contract assets
components in the contract arrangements accounted
for correspondingly. A contract asset is the right to consideration in
exchange for goods or services that the Group has
Where the contract gives the Group the right to
transferred to a customer, and that right is conditioned
unconditionally collect a certain amount of cash
on something other than the passage of time.
and bank balances or other financial assets from
the contract awarder within a certain period after For details of how the Group measures and accounts
the completion of the project, contract assets are for the ECLs of a contract asset, refer to Notes III.9.
recognised when the revenue is recognised. When
the Group obtains the right to receive consideration Contract liabilities
unconditionally, the contract assets will be transferred A contract liability is the obligation to transfer goods
to financial assets to be accounted for. or services to a customer for which the Group has
Where the contract gives the Group the right to charge received consideration or an amount of consideration
the service recipient an uncertain amount of fees within is due from the customer, such as an amount of
a certain period of operation after the completion of the consideration that an entity has received before the
project, since the right does not constitute a right to transfer of the promised goods or services.
unconditionally collect certain amount of cash and bank
25. Contract cost assets
balances or other financial assets, intangible assets are
recognised when the revenue is recognised. When an The Group’s contract cost assets include the costs
infrastructure project is completed, relevant intangible to obtain and fulfil a contract and are classified as
assets are amortised on the straight-line basis over the inventories, other current assets and other non-current
franchise period. assets by liquidity.
Revenue is recognised for the services provided in The Group recognises as an asset the incremental
the stage of operation, and the routine maintenance or costs of obtaining a contract with a customer if the
repair expenses incurred are recognised as expenses Group expects to recover those costs, unless the
in the current period. amortisation period of the asset is one year or less.
Other than the costs which are capitalised as
Recognition of revenue from Build-Transfer (“BT”)
inventories, fixed assets and intangible assets, etc.,
For construction services rendered by the Group, costs incurred to fulfil a contract with a customer are
related revenue and costs are recognised during the capitalised as an asset if all of the following criteria are
stage of construction according to the construction met:
contract. Revenue from construction services is
(1) the costs relate directly to a contract or to
measured at the consideration received or receivable
an anticipated contract, including direct
by the Group. The Group recognises contract
labour, direct materials, overheads (or similar
assets when recognising revenue, and accounts
expenses), costs that are explicitly chargeable
for any significant financing component in the
to the customer and other costs that are
contractual arrangement. The revenue is transferred
incurred only because an entity entered into
to financial assets when the Group obtains the right to
the contract;
unconditionally collect consideration and is deducted
against long-term receivables after the Group receives (2) the costs generate or enhance resources
the payment from the project owner. of the Group that will be used in satisfying
performance obligations in the future; and
(3) the costs are expected to be recovered.
The contract cost asset is amortised and charged to
profit or loss on a systematic basis that is consistent
with the pattern of the revenue to which the asset
related is recognised.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

The Group accrues provisions for impairment and Where the Group receives loans granted at a below-
recognises impairment losses to the extent that the market rate of interest from a lending bank funded with
carrying amount of a contract cost asset exceeds: financial interest subsidies, the initial carrying amount
of the borrowings is the actual proceeds received, and
(1) the remaining amount of consideration that the
the calculation of the borrowing costs shall be based
entity expects to receive in exchange for the
on the principal and the below-market rate of interest.
goods or services to which the asset relates;
less 27. Income tax
(2) the costs that are expected to be incurred to Income tax comprises current and deferred tax.
transfer those related goods or services. Income tax is recognised as income or expense in
The Group recognises in profit or loss a reversal of the profit or loss, or recognised directly in equity if it arises
impairment loss previously recognised to the extent from a business combination or relates to a transaction
that the difference between (1) and (2) exceeds the or event which is recognised directly in equity.
carrying amount of the asset due to the subsequent Current tax liabilities or assets arising from the current
changes of the factors causing asset impairment in and prior periods at the amount expected to be paid by
previous periods, but the carrying amount after the the Group or returned by the tax authority calculated
reversal does not exceed the carrying amount of the according to related tax laws.
asset at the reversal date if no impairment loss is
otherwise recognised. Deferred tax is provided using the balance sheet
liability method, on all temporary differences at the
26. Government grants end of the reporting period between the tax bases of
assets and liabilities and their carrying amounts, and
Government grants are recognised when all attaching
temporary differences between the tax bases and the
conditions will be complied with and the grants will
carrying amounts of the items, which have a tax base
be received. If a government grant is in the form of
according to related tax laws but are not recognised as
a transfer of a monetary asset, it is measured at the
assets and liabilities.
amount received or receivable. If a government grant
is in the form of a transfer of a non-monetary asset, Deferred tax liabilities are recognised for all taxable
it is measured at fair value; if fair value is not reliably temporary differences, except:
determinable, it is measured at a nominal amount.
(1) when the taxable temporary difference arises
According to the government documents, those used from the initial recognition of goodwill, or an
for the purposes of purchase, construction or other asset or liability in a transaction that is not
formations of long-term assets shall be regarded as the a business combination and, at the time of
government grants related to assets; if the government transaction, affects neither accounting profit
documents are not clear, the judgment shall be made nor taxable profit or loss; and
on the basis of the basic conditions that must be met
(2) in respect of taxable temporary differences
to obtain the grants. The government grants related
associated with investments in subsidiaries,
to assets shall be those based on the purchase,
associates and joint ventures, when the timing
construction or other formations of long-term assets,
of the reversal of the temporary differences
and the others shall be regarded as the government
can be controlled and it is probable that the
grants related to income.
temporary differences will not be reversed in
The group adopts the total method to measure the foreseeable future.
government grants.
Deferred tax assets are recognised for all deductible
A government grant related to income is accounted for temporary differences, and the carryforward of unused
as follows: (i) if the grant is a compensation for related tax losses and any unused tax credits. Deferred tax
expenses or losses to be incurred in subsequent assets are recognised to the extent that it is probable
periods, the grant is recognised as deferred income, that taxable profit will be available against which the
and released in profit or loss over the periods in which deductible temporary differences, the carryforward
the related costs are recognised; or (ii) if the grant is a of unused tax losses and unused tax credits can be
compensation for related expenses or losses already utilised, except:
incurred, it is recognised immediately in profit or loss.
(1) when the deductible temporary difference
A government grant relating to an asset shall be offset arises from the initial recognition of an asset or
against the carrying amounts of relevant assets, or liability in a transaction that is not a business
recognised as deferred income and amortised in profit combination and, at the time of the transaction,
or loss over the useful life of the related asset by annual affects neither the accounting profit nor taxable
instalments in a systematic and rational way (however, profit or loss; and
a government grant measured at a nominal amount is
recognised directly in profit or loss). Where the assets
are sold, transferred, retired or damaged before the
end of their useful lives, the rest of the remaining
deferred income is released to profit or loss for the
period in which the relevant assets are disposed of.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

(2) in r espect of t he deducti b le te m po r ar y As lessee of a finance lease

differences associated with investments in
For an asset that is held under a finance lease, at the
subsidiaries, associates and joint ventures,
commencement of the lease term, the leased asset
deferred tax assets are only recognised to the
is recognised at the lower of its fair value and the
extent that it is probable that the temporary
present value of the minimum lease payments at the
differences will be reversed in the foreseeable
inception of the lease, and the minimum lease payment
future and taxable profit will be available
is recognised as the carrying amount of the long-term
against which the temporary differences can
payables; the difference is accounted as unrecognised
be utilised in the future.
finance charge, which is amortised using the effective
At the end of the reporting period, deferred tax assets interest method over each period during the lease
and liabilities are measured at the tax rates that are term. Contingent rents are charged to profit or loss as
expected to apply to the period when the asset is incurred.
realised or the liability is settled, in accordance with the
requirements of tax laws. The measurement of deferred 29. Discontinued operation
tax assets and deferred tax liabilities reflects the tax A discontinued operation is a component separately
consequences that would follow from the manner in identifiable that either has been disposed of or is
which the Group expects, at the end of the reporting classified as held for sale, and satisfies one of the
period, to recover the assets or settle the liabilities. following conditions:
The carrying amount of deferred tax assets is reviewed (1) it represents a separate major line of business
at the end of the reporting period and reduced to or geographical area of operations;
the extent that it is no longer probable that sufficient
taxable profit will be available in future periods to allow (2) it is part of a single co-ordinated plan to
the deferred tax assets to be utilised. Unrecognised dispose of a separate major line of business or
deferred tax assets are reassessed at the end of the geographical area of operations; or
reporting period and are recognised to the extent that (3) it is a subsidiary acquired exclusively with a
it has become probable that sufficient taxable profit will view to resale.
be available to allow all or part of the deferred tax asset
to be recovered. 30. Share repurchase
Deferred tax assets and deferred tax liabilities are offset Considerations and transaction costs paid for
if and only if the Group has a legally enforceable right repurchase of our equity instruments should be
to set off current tax assets and current tax liabilities, accounted for a deduction from equity. In addition
and the deferred tax assets and deferred tax liabilities to share-based payment, the issuance (including
relate to income taxes levied by the same taxation refinancing), repurchase, sales or cancellations of
authority on either the same taxable entity or different own equity instruments shall be treated as changes in
taxable entities which intend either to settle current tax equity.
liabilities and assets on a net basis, or to realise the
assets and settle the liabilities simultaneously, in each 31. Profit distribution
future period in which significant amounts of deferred The cash dividend is recognised as a liability upon
tax liabilities or assets are expected to be settled or approval in the general meeting of shareholders.
recovered.
32. Safety production expenses
28. Leases
Safety production expenses provided according to the
A finance lease is a lease that transfers substantially regulations are included in costs of related products
all the risks and rewards of ownership of an asset. An or profit or loss, and credited to the special reserve.
operating lease is a lease other than a finance lease. They are treated differently when being utilised: (i) the
special reserve are debited for those expenditure with
As lessee of an operating lease the expense nature; or (ii) the cumulative expenditures
Lease payments under an operating lease are are capitalised as a fixed asset for those expenditure
recognised by a lessee on a straight-line basis over to be capitalised when the working condition for the
the lease term, and either included in the cost of the intended use is reached, and at the same time, special
related asset or charged to profit or loss. Contingent reserve are debited with the full depreciation of the
rents are charged to profit or loss as incurred. fixed asset of the same amount.

As lessor of an operating lease

Rent income under an operating lease is recognised on
a straight-line basis over the lease term, through profit
or loss. Contingent rents are charged to profit or loss
as incurred.

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33. Fair value measurement 34. Significant accounting judgements and

The Group measures part of its debt instruments and estimates
equity investments at fair value at each end of the The preparation of the financial statements requires
reporting period. Fair value is the price that would be management to make judgements, estimates and
received to sell an asset or paid to transfer a liability in assumptions that affect the reported amounts of
an orderly transaction between market participants at revenue, expenses, assets and liabilities, and their
the measurement date. The fair value measurement is accompanying disclosures, and the disclosure of
based on the presumption that the orderly transaction contingent liabilities at the end of the reporting period.
to sell the asset or transfer the liability takes place Uncertainty about these assumptions and estimates
either in the principal market for the asset or liability, could result in outcomes that could require a material
or in the absence of a principal market, in the most adjustment to the carrying amounts of the assets or
advantageous market for the asset or liability. The liabilities affected in the future.
principal or the most advantageous market must be
accessible by the Group at the measurement date. The Judgements
fair value of an asset or a liability is measured using
In the process of applying the Group’s accounting
the assumptions that market participants would use
policies, management has made the following
when pricing the asset or liability, assuming that market
judgements which have a significant effect on the
participants act in their best economic interest.
amounts recognised in the financial statements:
A fair value measurement of a non-financial asset takes
into account a market participant’s ability to generate Operating leases – the Group as lessor
economic benefits by using the asset in its highest and
best use or by selling it to another market participant The Group has entered into lease agreements on
that would use the asset in its highest and best use. its investment property portfolio. The Group has
determined these leases to be operating leases, based
The Group uses valuation techniques that are on an evaluation of the terms and conditions of the
appropriate in the circumstances and for which agreements, that it retains almost all the significant
sufficient data and other information are available to risks and rewards of ownership of these properties.
measure fair value, maximising the use of relevant
observable inputs and minimising the use of Division of investment properties and inventories
unobservable inputs.
The properties constructed by the group may be used
All assets and liabilities for which fair value is measured
for sale, rent earning and/or capital appreciation. At
or disclosed in the financial statements are categorised
the initial stage of construction, the Group classifies
within the fair value hierarchy based on the lowest level
the property into inventory or investment property
input that is significant to the fair value measurement as
according to the holding purpose. During the period
a whole:
under construction, the properties used for sale after
Level 1 Based on quoted prices (unadjusted) in active completion are classified as inventories-properties
markets for identical assets or liabilities; under development and included in current assets, the
Level 2 Based on valuation techniques for which the properties used to earn rent and/or capital appreciation
lowest level input that is significant to the after completion are classified as investment properties
fair value measurement is observable, either in progress and included in non-current assets. After
directly or indirectly; completion, the properties used for sale are transferred
to inventories-completed properties for sale, while the
Level 3 Based on valuation techniques for which the properties used to earn rent and/or capital appreciation
lowest level input that is significant to the fair are transferred to investment properties.
value measurement is unobservable.
For assets and liabilities that are measured at fair value
in the financial statements on a recurring basis, the
Group determines whether transfers have occurred
between levels in the hierarchy by reassessing
categorisation on each balance sheet date.

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Division of investment properties and fixed assets Contractual cash flow characteristics
The Group determines whether the property it The classification of financial assets at initial recognition
holds meets the definition of investment property depends on the financial asset’s contractual cash flow
and establishes relevant standards when making characteristics, and the judgements on whether the
judgments. The Group classifies the property held for contractual cash flows are solely payments of principal
earning rent or capital appreciation, or both (including and interest on the principal amount outstanding,
buildings under construction or development for including when assessing the modification of the time
future use for rental). The Group will consider whether value of money, the judgement on whether there is any
the cash flow generated by the property is largely significant difference from the benchmark cash flow
independent of other assets held by the group. Some and whether the fair value of the prepayment features
properties are used to earn rent or capital appreciation, is insignificant for financial assets with prepayment
and the remaining part is used to produce goods, features, etc.
provide services or operation and management. If
the part used to earn rent or capital appreciation can Revenue from sales of real estate
be sold or leased separately. If not, the property will
be classified as investment property only if the part According to the accounting policies described in
used for producing goods, providing labor services Note III. 23, the Group’s revenue from real estate
or operation and management is not significant. development business is recognised when the
When determining whether the importance of auxiliary control over properties is transferred to the customer.
services is sufficient to make the property not meet According to the terms under the sales contract and
the recognition conditions of investment property, laws and regulations applicable to the contract, the
the Group will make a separate judgment based on control over properties can be transferred within
individual property benchmark. a certain period of time or at a certain point of
time. Where goods produced during the Group’s
performance of the contract are irreplaceable and the
Determination method of construction contract
Group is entitled to collect payments for the part of the
performance schedule performance that has been completed so far during
The Group determines the performance progress the entire contract period, revenue is recognised over
of the construction contract according to the input a certain period of time based on the progress of
method. Specifically, the Group determines the performance obligation fulfilment during the contract
performance progress according to the proportion period. Otherwise, revenue is recognised when the
of the accumulated actual construction cost in the customer obtains the physical ownership of goods or
estimated total cost. The accumulated actual cost the legal ownership of completed properties, and the
includes the direct cost and indirect cost incurred Group obtains the present right to receive payment and
in the process of the Group transferring goods to probably recovers the contract consideration.
customers. The construction contract price with the Due to the restriction of real estate sales contract, the
customer is determined based on the construction cost. Group’s properties generally have no alternative use.
The proportion of the actual construction cost to the However, whether the Group has the enforcement right
estimated total cost can truly reflect the performance to collect the part that has been completed so far and
progress of the construction service. In view of the long use the method of recognising income over a period
lifetime of the construction contract and the possibility of time depends on the agreement of each contract
of spanning several accounting periods, the Group term and the relevant law applicable to the contract. In
will review and revise the budget with the progress order to assess whether the Group has obtained the
of the construction contract, and adjust the revenue enforcement right on the part that has been performed,
recognition amount accordingly. the Group reviews its contract terms, relevant local
laws, and takes into account the opinions of local
Business model regulatory authorities when necessary, and needs to
make a lot of judgments.
The classification of financial assets at initial recognition
depends on the Group’s business model for managing When the Group signs a sales contract with a properly
financial assets. When determining the business buyer, according to the requirements of some banks,
model, the Group considers the methods to include if the buyer needs to obtain a mortgage loan from the
evaluation and report financial asset performance to bank to pay the house money, the Group will enter into
key management, the risks affecting the performance a tripartite mortgage guarantee loan agreement with
of financial assets and the risk management, and the the buyer and the bank. The Group will provide phased
manner in which the relevant management receives joint liability guarantee for mortgage loans issued
remuneration. When assessing whether the objective by banks to the properly buyer. The phased joint
is to collect contractual cash flows, the Group needs liability guarantee will be released after the properly
to analyse and judge the reason, timing, frequency buyer has completed the house ownership certificate
and value of the sale before the maturity date of the and completed the real estate mortgage registration
financial assets. procedures. The Group only needs to provide
guarantee to the bank for the outstanding mortgage
loan of the buyer within the guarantee period. The bank
will only claim against the Group if the buyer defaults
and fails to repay the mortgage loan.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

According to the Group’s historical experience in selling Impairment of non-current assets other than
similar developed products, the Group believes that financial assets (other than goodwill)
during the period of phased joint liability guarantee, the
ratio of the Group’s guarantee liability to the bank due The Group assesses whether there are any indications
to the buyer’s failure to repay the mortgage loan is very of impairment for all non-current assets other than
low, and the Group can claim the advance payment financial assets at the end of the reporting period.
paid by the buyer for undertaking the guarantee of Intangible assets with indefinite useful lives are tested
phased joint liability. In the case of non-repayment by for impairment annually and at other times when such
the buyer, the Group can avoid loss by giving priority an indication exists. Other non-current assets other
to the relevant property according to the relevant than financial assets are tested for impairment when
purchase contract. Therefore, the Group believes that there are indications that the carrying amounts may
the financial guarantee has no significant impact on the not be recoverable. An impairment exists when the
recognition of sales revenue of development products. carrying amount of an asset or asset group exceeds its
recoverable amount, which is the higher of its fair value
Equity instruments less costs of disposal and the present value of the
future cash flows expected to be derived from it. The
Equity instruments such as non-cumulative preference calculation of the fair value less costs of disposal based
shares and perpetual bonds issued by the Group on available data from binding sales transactions in an
do not need to be settled by the Group’s own equity arm’s length transaction of similar assets or observable
instruments, excluding the contractual obligations to market prices less incremental costs for disposing of
deliver cash or other financial assets to other parties, the assets. When the calculations of the present value
or to exchange financial assets or financial liabilities of the future cash flows expected to be derived from
with other parties under potential adverse conditions. an asset or asset group are undertaken, management
Therefore, the Group calculates them as other equity must estimate the expected future cash flows from the
instruments. asset or asset group and choose a suitable discount
rate in order to calculate the present value of those
Estimation uncertainty
cash flows.
The key assumptions concerning the future and other
key sources of estimation uncertainty at the end of the Impairment of goodwill
reporting period, that have a significant risk of causing
a material adjustment to the carrying amounts of assets The Group determines whether goodwill is impaired at
and liabilities within the future accounting periods, are least on an annual basis.This requires an estimatation
described below. of the value in use of the cash-generating units to which
the goodwill has been allocated.Testing the value in
Impairment of financial instruments and contract use requires the Group to make an estimate of the
expected future cash flows from the cash-generating
assets units and also to choose a suitable discount rate in
The Group uses the expected credit loss model to order to calculate the present value of those cash
assess the impairment of financial instruments and flows.
contract assets. The Group is required to perform
significant judgements and estimations and take into Fair value of unlisted equity investments
account all reasonable and supportable information, The unlisted equity investments have been valued
including forward-looking information. When making based on the expected cash flows discounted at
such judgements and estimates, the Group infers the current rates applicable for items with similar terms and
expected changes in the debtor’s credit risk based risk characteristics. This valuation requires the Group
on historical repayment data combined with economic to make estimates about expected future cash flows,
policies, macroeconomic indicators, industry risks and credit risk, volatility and discount rates, and hence they
other factors. The different estimates may impact the are subject to uncertainty.
impairment assessment, and the impairment allowance
may also not be representative of the actual impairment
Construction and service contracts
loss in the future.
Recognition of revenue and expenses from construction
and service contracts requires management to make
relevant estimates. If losses are expected to occur in
construction and service contracts, such losses should
be recognised as current costs. The management of
the Group estimates the possible losses based on the
construction and service contract budget. Due to the
characteristics of housing construction, infrastructure
construction, and design businesses, the date at
which the contract activity is entered into and the date
when the activity is completed usually fall into different
accounting periods. The Group reviews and revises the
estimates of both contract revenue and contract costs
in each contract budget as the contract progresses.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Deferred tax assets Measurement of defined benefit obligations

Deferred tax assets are recognised for all unused tax The Group recognised the supplementary allowances
losses to the extent that it is probable that taxable and benefits paid to certain retired and early retirement
profit will be available against which the losses can be employees as liabilities. The amount of these welfare
utilised. Significant judgement from the management expenses and liabilities are determined using actuarial
is required to determine the amount of deferred tax valuations conducted by independent professional
assets that can be recognised, based upon the likely actuaries. Independent professional actuaries evaluate
timing and level of future taxable profits together with the actuarial status of the Group’s retirement plan every
future tax planning strategies. year. These actuarial valuations involve assumptions
made on discount rates, retirement benefit inflation
Land appreciation tax rates and other factors. In view of its long-term nature,
the above estimates are uncertain.
The Group is required to pay land appreciation tax in
accordance with tax laws on the value-added portion
Useful lives and residual values of fixed assets
of property sales. The provision for land appreciation
tax is the best estimate made by the management After considering the residual value of the fixed assets,
based on the understanding of relevant tax laws and the Group accrues depreciation within the estimated
regulations. The actual land appreciation tax liability useful life. The Group regularly reviews the estimated
must be determined by the tax authority when the useful life and residual value of related assets to
land appreciation tax is settled. The Group has not determine the amount of depreciation expenses that
yet determined its land appreciation tax settlement will be included in each reporting period. The useful
and taxation plans for certain real estate development life and residual value of assets are determined by the
projects with tax authorities. The final land appreciation Group based on the past experience of similar assets
tax calculation result may be different from the amount and combined with expected technological changes.
initially recorded, and any difference will affect the land If the previous estimate changes significantly, the
appreciation tax expenditure and related provision depreciation expense will be adjusted in the future
amount during the period when the difference is period.
realised.
35. Changes in accounting policies and estimates
Confirmation and allocation of properties under
Changes in accounting policies
development
Changes in the presentation of financial statements
The cost of real estate construction is recorded as
inventory during the construction period, and will be According to the Question and Answer on the
carried forward to the income statement after real implementation of enterprise accounting standards
estate sales revenue is confirmed. Before the final issued by the Ministry of Finance in December 2020,
settlement of project costs and other related real estate the Group reclassified the impairment loss of contract
development costs, such costs need to be estimated assets originally included in the “credit impairment
by the management of the Group based on budgeted losses” in the income statement to “asset impairment
costs and development progress. The Group’s real losses”. The change in accounting policy has no
estate development is generally carried out in stages, impact on the net profit and the equity both on the
and the cost directly related to the development of a consolidated and the company levels.
certain period is recorded as the cost of that period.
The common costs of different stages are allocated Related party disclosure scope
to each stage according to the saleable area. If the
According to Accounting Standard for Business
final settlement of the project cost and the related
Enterprises No. 13, from 1 January 2020, the following
cost allocation are different from the initial estimate,
parties that were not regarded as related parties
the increase or decrease of the project cost and other
previously are regarded as related parties: Joint
costs will affect the profit and loss in the future years.
ventures and their subsidiaries or associates and their
subsidiaries of other member units of the Company’s
Inventory impairment corporate group (including parent companies and
The Group’s inventory is measured at the lower of cost subsidiaries), subsidiaries of joint ventures and
and net realisable value. The net realisable value of subsidiaries of associates. This accounting policy
inventory refers to the estimated selling price of the change affected the judgment of related parties and
inventory minus the estimated cost, estimated selling the disclosure of related party transactions.
expenses and relevant taxes and fees at the time of
completion. The management’s calculation of the net
realisable value of inventories involves the estimation of
estimated selling prices, estimated costs to be incurred
by the time of completion, estimated selling expenses
and relevant taxes. Changes in these estimates will
affect the book value of inventories and the profit and
loss of future changes.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

IV. Taxation
1. Main taxes and rates
Taxable income is calculated at the corresponding tax rate as output tax, and the
value-added tax is calculated on the basis of the difference after deducting the input
Value-added tax –
tax allowed to be deducted in the current period. The applicable tax rates of the
Group for the year ended 31 December 2020 included 13%, 9%, 6%, 5% and 3%.
According to the “Regulations on Issues Related to the Pilot Reform of Business Tax
to Value-Added Tax” issued by the Ministry of Finance and the State Administration
of Taxation in 2016, the Group calculates tax payable at 3% and 5% of taxable
income for old projects (refer to projects initially built before 1 April 2016) in the
construction industry based on simple tax calculation methods and in the real estate
development industry, respectively.
City maintenance and
– Calculated and paid at 7% or 5% of the actual turnover tax paid.
  construction tax
The Group’s corporate income tax in Mainland China is calculated and paid at 25%
of the taxable income (except for the tax incentives described in Note IV.2). The
Corporate income tax – corporate income tax in Hong Kong is calculated and paid at 16.5% of the taxable
income. For other overseas regions, the taxable income shall be 0 to 35% of the
taxable income.
Education surcharge – Calculated and paid at 3% of the actual turnover tax paid.
If the Group transfers land use rights and the property rights of buildings or other
Land appreciation tax – attachments on the ground for a fee, the land appreciation tax is calculated and paid
at a four-tier progressive tax rate of 30% to 60%.
Real estate tax is levied at 1.2% of the original value of the property or 12% of the
Real estate tax –
rental income.

2. Preferential tax treatments

The corporate income tax preferences enjoyed by the Group are as follows:
Preferential tax treatment for key high and new technological enterprises encouraged and supported by the
state
According to the income tax law and other relevant regulations, the Group’s subsidiaries recognised as key high and new
technological enterprises encouraged and supported by the state are as follows:
Certificate of High and
New Technological Effective
Company name Enterprises tax rate
First Construction Co., Ltd. of China Construction Third Engineering Division GR201842000496 15%
Second Construction Co., Ltd. of China Construction Third Engineering Division GR202042002204 15%
Third Construction Co., Ltd. of China Construction Third Engineering Division GR202042001764 15%
China Construction Third Engineering Design Co., Ltd. GR201942000474 15%
China Construction Science And Industry Co., Ltd. GR202044202198 15%
China Construction Sixth Engineering Division Co., Ltd. GR201912000220 15%
China Construction Sixth Engineering Installation Co., Ltd. GR202012001086 15%
Decoration Engineering Co., Ltd. of China Construction Sixth Engineering Division GR201912002245 15%
Civil Engineering Co., Ltd. of China Construction Sixth Engineering Division GR201912001530 15%
China Construction Eighth Engineering Division. Co., Ltd. GR201931000151 15%
China State Construction Electronic Engineering Co., Ltd. GR201911005213 15%
China State Construction Northeast Architectural Design Institute Co., Ltd. GR202021001043 15%
China Municipal Engineering Northwest Design and Research institute Co., Ltd. GR201862000089 15%
China State Construction Built Port Group GR202037100401 15%
China State Construction Engineering Industry Technology Research Institute GR201811001379 15%
China West Construction Hunan Co., Ltd. GR201943000494 15%
China Construction Commodity Concrete Co., Ltd. GR201842000632 15%
First Construction Co., Ltd. of China Construction Eighth Engineering Division GR202037003064 15%
Wuxi Tianyu Civil Defense Architecture Design and Research institute Co., Ltd. GR202032011349 15%
China Construction Eighth Bureau Decoration Engineering Co., Ltd. GR201831000637 15%
Hong Kong Huayi Design Consultants (Shenzhen) Co., Ltd. GR202044204944 15%
Shenzhen Hailong Construction Technology Co., Ltd. GR201844201581 15%
Anhui Hailong Construction Industry Co., Ltd. GR201834001125 15%
Southwest China Architecture Design and Research Institute Co., Ltd. GR202051002428 15%
China Construction Port and Shipping Bureau Group Co., Ltd. GR201831003631 15%
China Construction Engineering Design Group Corporation Limited GR202011003894 15%

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Certificate of High and

New Technological Effective
Company name Enterprises tax rate
Shenzhen Overseas Decoration Engineering Co., Ltd. GR202044206222 15%
Beijing China Construction Research Institute Co., Ltd. GR202011006430 15%
Beijing Construction Engineering Quality Sixth Inspection Institute Co., Ltd. GR201911001810 15%
China Construction First Bureau Huajiang Company GR201811004821 15%
China State Construction Technology (Beijing) Co., Ltd. GR202011001695 15%
China Construction Eighth Bureau Second Construction Co., Ltd. GR201837001149 15%
China Construction Eighth Bureau Fourth Construction Co., Ltd. GR201837100283 15%
China Construction Wuzhou Engineering Equipment Co., Ltd. GR202032006648 15%
China construction eighth bureau third construction Co., Ltd. GR201832008670 15%
Shanghai Haida Communication Co., Ltd. GR201831001128 15%
China Construction Sixth Bureau Construction Development Co., Ltd. GR201812000759 15%
China Construction Second Bureau Installation Engineering Co., Ltd. GR201811000600 15%
China Construction Second Bureau First Construction Engineering Co., Ltd. GR201811005369 15%
The Third Construction Engineering Company Ltd. Of China Construction GR201811004750 15%
China Construction Third Bureau Group Co., Ltd. GR201942000706 15%
China Construction Technology Chengdu Co., Ltd. GR201951000045 15%
China Construction Xinjiang Construction Engineering Group First Construction GR201965000169 15%
China Construction Xinjiang Construction Engineering Group Fifth Construction GR201965000091 15%
Beijing Zhongjian Architectural Design Institute Co., Ltd. GR201911007163 15%
Guizhou China Construction Architecture Research and Design Institute Co., Ltd. GR202052000333 15%
China Construction Fourth Bureau (Jieyang) Investment and Construction Co., Ltd. GR201852000109 15%
Heshan Tianshan Metal Material Products Co., Ltd. GR201944006890 15%
Shandong Hailong Construction Technology Co., Ltd. GR201937001855 15%
Shenzhen Xinghai IOT Technology Co., Ltd. GR202044200845 15%
China Construction Seventh Engineering Division. Co., Ltd. GR201941000445 15%
China State Construction Fourth Engineering Bureau Group Co., Ltd. GR201944005866 15%
China Construction Fifth Engineering Bureau Co., Ltd. GR202043000761 15%
China Architecture Shanghai Design Institute Co., Ltd. GR201831000884 15%
China Construction Third Bureau Installation Engineering Co., Ltd. GR201942002292 15%
China Construction Buer Curtain Wall Decoration Co., Ltd. GR201843000020 15%
China State Construction Oriental Decoration Co., Ltd. GR201831000692 15%
China Construction Second Bureau Decoration Engineering Co., Ltd. GR202011000990 15%
China Construction Strait Construction Development Co., Ltd. GR201935001105 15%
China State Construction Technology Henan Co., Ltd. GR201941000149 15%
China Construction Technology Hunan Co., Ltd GR201843000026 15%
China State Construction Technology Group Co., Ltd. GR202044206081 15%
China State Construction Technology Wuhan Co., Ltd. GR202042001219 15%
China State Construction Technology Changchun Co., Ltd. GR201922000666 15%
Xinjiang Institute of Building Research (Limited Liability Company) GR202065000035 15%
China Construction Bridge Co., Ltd. GR201951100648 15%
China Construction Third Bureau Intelligent Technology Co., Ltd. GR201842001070 15%
Sixth Construction Co., Ltd. of China Construction Fourth Engineering Division GR201934001377 15%
China Construction Fifth Bureau Third Construction Co., Ltd. GR201843000691 15%
China Construction Fifth Bureau Installation Engineering Co., Ltd. GR202043002082 15%
China Construction Fifth Bureau Building Energy Saving Technology Co., Ltd. GR201843001367 15%
Civil Engineering Co., Ltd. of China Construction Fifth Engineering Division GR201943000622 15%
China Construction Fifth Bureau Decoration Curtain Wall Co., Ltd. GR201843000763 15%
China Construction West Construction New Material Technology Co., Ltd. GR201951000934 15%
China Construction Xinjiang Construction Engineering (Group) Co., Ltd. GR201865000092 15%
China Construction First Bureau Group Decoration Engineering Co., Ltd. GR202011004486 15%
China Construction Zhongyuan Architectural Design Institute Co., Ltd. GR201941001453 15%
China Construction Fourth Bureau Third Construction Engineering Co., Ltd. GR201852000186 15%
China Construction Fourth Engineering Co., Ltd. GR201952000201 15%

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Certificate of High and

New Technological Effective
Company name Enterprises tax rate
Guangdong Zhongjian New Building Components Co., Ltd. GR201844001975 15%
China Construction Xinjiang Construction Engineering Group
GR202065000046 15%
  Third Construction Engineering Co., Ltd.
China Construction Railway Investment and Construction Group Co., Ltd. GR201811008129 15%
China State Construction Technology (Shenshan Special Cooperation Zone) Co., Ltd. GR202044204908 15%
China Construction Infrastructure Co., Ltd. GR202011000138 15%
China Building Decoration Group Co., Ltd. GR201911003518 15%
China Construction Fourth Bureau First Construction Engineering Co., Ltd. GR201844005132 15%
Shanghai CSCEC Dongfu Investment Development Co., Ltd. GR201931000710 15%
China Construction Fifth Bureau East China Construction Co., Ltd. GR201931004205 15%
China Construction Fifth Bureau Landscape Co., Ltd. GR201843000182 15%
China Construction Second Engineering Bureau Co., Ltd. GR202011005634 15%
China Construction Second Bureau Second Construction Engineering Co., Ltd. GR202044203757 15%
China State Construction Intelligent Technology Co., Ltd. GR202011001520 15%
China Construction First Bureau Group Construction Development Co., Ltd. GR202011001749 15%
China Construction Fourth Bureau Fifth Construction Engineering Co., Ltd. GR202044204395 15%
China Construction Fourth Bureau Civil Engineering Co., Ltd. GR202044205254 15%
China Construction Third Bureau Urban Construction Co., Ltd. GR202022000413 15%
China State Construction Technology (Fuzhou) Co., Ltd. GR202035000126 15%
Langfang Zhongjian Machinery Co., Ltd. GR202013003092 15%
China Construction Southwest Survey, Design and Research Institute Co., Ltd. GR202051000142 15%
China Construction Underground Space Co., Ltd. GR201951002244 15%
China Construction Dongshe Geotechnical Engineering Co., Ltd. GR202021001224 15%
China Construction Zhongxin Construction Engineering Co., Ltd. GR202037101613 15%
Beijing China Construction Engineering Consultants Co., Ltd. GR201911000724 15%

Preferential tax policy related with Western Development Strategies and Xinjiang region
Preferential Policy Effective
Company Name (Note) tax rate
Shaanxi China Construction Northwest Engineering Supervision Co., Ltd. Cai Shui [2011] No. 58 15%
China Northwest Architecture Design & Research Institute Co., Ltd. Cai Shui [2011] No. 58 15%
Chongqing Branch of China Architecture Southwest Design and Research Institute Co., Ltd. Cai Shui [2011] No. 58 15%
Tibet Branch of China Architecture Southwest Design and Research Institute Co., Ltd. Cai Shui [2011] No. 58 15%
China Construction Southwest Survey, Design and Research Institute Co., Ltd. Cai Shui [2011] No. 58 15%
China Construction Underground Space Co., Ltd. Cai Shui [2011] No. 58 15%
China Construction Zunyi Xinpu Construction Development Co., Ltd. Cai Shui [2011] No. 58 15%
Xinjiang Construction Engineering Quality and Safety Inspection Center Cai Shui [2011] No. 58 15%
China Construction West Construction Co., Ltd. (“Western Construction”) and some of its subsidiaries Cai Shui [2011] No. 58 15%
Yanqi County Xiqing Jiyuan Co., Ltd. Cai Shui [2011] No. 58 15%
Shihezi City West Construction Co., Ltd. Cai Shui [2011] No. 58 15%
Karamay Xijian Building Materials Co., Ltd. Cai Shui [2011] No. 58 15%
Haidong Underground Comprehensive Pipe Gallery Construction and Operation Management Co., Ltd. Cai Shui [2011] No. 58 15%
Xi’an Xingchu Construction Co., Ltd. Cai Shui [2011] No. 58 15%
China Construction Tunnel Construction Co., Ltd. Cai Shui [2011] No. 58 15%
China Construction Silk Road Construction Investment Co., Ltd. Cai Shui [2011] No. 58 15%
China Construction Transportation Construction Engineering (Tibet) Co., Ltd. Cai Shui [2011] No. 58 15%
Chongqing Maohe Infrastructure Construction Co., Ltd. Cai Shui [2011] No. 58 15%
China State Construction Southwest Research Institute General Contracting Engineering Co., Ltd. Cai Shui [2011] No. 58 15%
Shihezi Jianfu Urban Pipe Corridor Construction Investment Co., Ltd. Cai Shui [2011] No. 58 15%
China Construction Wuzhou Infrastructure Investment Co., Ltd. Cai Shui [2011] No. 58 15%
China State Construction Technology Mianyang Co., Ltd. Cai Shui [2011] No. 58 15%
Note: According to Circular on Issues Concerning Tax Policies for In-depth Implementation of Western Development Strategies (Cai Shui [2011]
No. 58) and the Notice Concerning the Continuation of the Cestern Development Enterprise Income Tax Policies (Ministry of Finance Notice
No. 23 of 2020), the eligible enterprises are entitled 15% preferential income tax rate.

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V. Notes to the consolidated financial statements

1. Cash and bank balances

31 December 2020 31 December 2019

Cash on hands 132,591 143,503
Cash at banks 288,574,473 284,127,185
Other cash and bank balances 7,150,126 8,170,731
Total 295,857,190 292,441,419

Other cash and bank balances represents deposits for bank acceptance notes, guarantee deposits and deposits for
migrant workers’ wages, etc.

As at 31 December 2020, the amount of fixed deposit with maturity of more than 3 months in the Group’s bank deposits is
RMB6,684,616 thousand (31 December 2019: RMB1,738,949 thousand).

Restricted cash and bank balances mainly represents reserves with Central Bank, deposits for bank acceptance notes,
guarantee deposits, pre-sale supervision fund and mortgage deposits. As at 31 December 2020, the restricted cash and
bank balances is RMB21,310,994 thousand (31 December 2019: RMB18,974,662 thousand).

As at 31 December 2020, the offshore deposits of the Group amounted to RMB31,500,940 thousand (31 December 2019:
RMB39,150,856 thousand).The amount deposited abroad and restricted in remittance recovery is RMB2,019,638 thousand
(31 December 2019: RMB1,669,686 thousand).

Short term time deposits are made for varying periods of between one day and one year depending on the immediate cash
requirements of the Company, and earn interest at the respective short term time deposit rates.

2. Financial assets held for trading

31 December 2020 31 December 2019

Financial assets at fair value through profit or loss
  Debt investments 214,859 862,307
  Equity investments 29,600 39,765
Total 244,459 902,072

Note 1:  The fair value of an investment in debt instrument held for trading is mainly determined based on the trading price
published by the financial institution in which it trades on the last trading day of the current period.
Note 2:  The fair value of an investment in equity instrument held for trading is determined based on the closing price of the
last trading day of the current period of the stock exchange in which the instrument trades.

3. Notes receivable

31 December 2020 31 December 2019

Commercial acceptance bills 31,989,282 26,918,443
Less: Impairment allowance – –
Total 31,989,282 26,918,443

The pledged notes receivable are as follows:

31 December 2020 31 December 2019
Commercial acceptance bills 2,028,537 689,065

As at 31 December 2020 and 31 December 2019, the notes receivable that were pledged by the Group to banks for
borrowings are presented in details in Note V. 66.

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V. Notes to the consolidated financial statements (continued)

3. Notes receivable (continued)

Commercial acceptance bills which had not matured but had been endorsed to other parties are as follows:
31 December 2020 31 December 2019
Derecognised Recognised Derecognised Recognised
Commercial acceptance bills – 14,402,188 – 8,216,967

Regardless of whether there is a significant financing component or not, the impairment provision of the Group’s notes
receivables are measured based on the lifetime ECL. After evaluation, the Group believes that the commercial acceptance
notes held do not have significant credit risk, and the ECLs amount is insignificant.

4. Accounts receivable

(1) The ageing of accounts receivable is analysed as follows:

31 December 2020 31 December 2019
Within 1 year 122,961,573 128,907,499
1-2 years 34,556,970 26,160,929
2-3 years 14,180,793 10,105,158
3-4 years 6,803,561 4,272,130
4-5 years 2,645,944 3,208,114
Over 5 years 5,082,973 5,112,222
Subtotal 186,231,814 177,766,052
Less: Impairment allowance (25,790,000) (23,804,177)
Total 160,441,814 153,961,875

(2) Provision for impairment:

Accounts receivable and impairment allowance are disclosed by category:
31 December 2020
Gross carrying amount Impairment allowance
Amount Ratio (%) Amount Ratio (%) Carrying value
Impairment of individually accrued 54,492,592 29.26 13,322,049 24.45 41,170,543
Impairment of collectively accrued
131,739,222 70.74 12,467,951 9.46 119,271,271
  by credit risk portfolio
Total 186,231,814 100.00 25,790,000 13.85 160,441,814

31 December 2019
Gross carrying amount Impairment allowance
Amount Ratio (%) Amount Ratio (%) Carrying value
Impairment of individually accrued 48,548,506 27.31 12,480,028 25.71 36,068,478
Impairment of collectively accrued
129,217,546 72.69 11,324,149 8.76 117,893,397
  by credit risk portfolio
Total 177,766,052 100.00 23,804,177 13.39 153,961,875

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V. Notes to the consolidated financial statements (continued)

4. Accounts receivable (continued)

(2) Provision for impairment: (continued)

As at 31 December 2020, impairment allowance of accounts receivable individually accrued is as follows:
Impairment Expected credit
Carrying amount allowance loss ratio Reasons
Company1 2,621,863 811,436 30.95% Recovery possibility
Company2 1,643,000 1,643,000 100.00% Recovery possibility
Company3 1,136,490 232,024 20.42% Recovery possibility
Company4 980,800 980,800 100.00% Recovery possibility
Company5 844,352 353,588 41.88% Recovery possibility
Other 47,266,087 9,301,201 19.68% Recovery possibility
Total 54,492,592 13,322,049

As at 31 December 2019, impairment allowance of accounts receivable individually accrued is as follows:

Impairment Expected credit
Carrying amount allowance loss ratio Reasons
Company1 2,004,490 440,988 22.00% Recovery possibility
Company2 1,314,400 1,314,400 100.00% Recovery possibility
Company3 1,028,096 5,140 0.50% Recovery possibility
Company4 772,123 347,455 45.00% Recovery possibility
Company5 517,409 103,677 20.04% Recovery possibility
Other 42,911,988 10,268,368 23.93% Recovery possibility
Total 48,548,506 12,480,028

The accounts receivable with impairment allowance collectively accrued by credit risk portfolio are as follows:

Portfolio 1:
31 December 2020 31 December 2019
Estimated Estimated
gross carrying Expected Lifetime gross carrying Expected Lifetime
amount at credit loss expected amount at credit loss expected
default ratio (%) credit loss default ratio (%) credit loss
Within 1 year 18,771,108 2.00 375,423 21,319,859 2.00 426,397
1-2 years 6,147,525 5.00 307,376 4,604,581 5.00 230,229
2-3 years 2,305,610 15.00 345,842 1,084,543 15.00 162,681
3-4 years 591,134 30.00 177,340 451,070 30.00 135,321
4-5 years 295,105 45.00 132,797 288,985 45.00 130,043
Over 5 years 244,208 100.00 244,208 225,993 100.00 225,993
Total 28,354,690 1,582,986 27,975,031 1,310,664

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V. Notes to the consolidated financial statements (continued)

4. Accounts receivable (continued)

(2) Impairment allowance (continued)

The accounts receivable with impairment allowance collectively accrued by credit risk portfolio are as follows: (continued)

Portfolio 2:
31 December 2020 31 December 2019
Estimated Estimated
gross carrying Expected Lifetime gross carrying Expected Lifetime
amount at credit loss expected amount at credit loss expected
default ratio (%) credit loss default ratio (%) credit loss
Within 1 year 3,155,015 6.00 189,301 6,548,628 6.00 392,918
1-2 years 588,659 12.00 70,639 376,293 12.00 45,155
2-3 years 240,065 25.00 60,016 3,476 25.00 869
3-4 years 37,907 45.00 17,058 32,565 45.00 14,654
4-5 years 4,293 70.00 3,005 5,146 70.00 3,602
Over 5 years 102,860 100.00 102,860 100,765 100.00 100,765
Total 4,128,799 442,879 7,066,873 557,963

Portfolio 3:
31 December 2020 31 December 2019
Estimated Estimated
gross carrying Expected Lifetime gross carrying Expected Lifetime
amount at credit loss expected amount at credit loss expected
default ratio (%)) credit loss default ratio (%) credit loss
Within 1 year 66,510,054 4.50 2,992,951 69,068,852 4.50 3,108,098
1-2 years 19,743,156 10.00 1,974,316 14,681,938 10.00 1,468,194
2-3 years 7,190,056 20.00 1,438,011 4,593,972 20.00 918,794
3-4 years 2,275,042 40.00 910,017 2,261,623 40.00 904,649
4-5 years 1,173,241 65.00 762,607 1,467,057 65.00 953,587
Over 5 years 2,364,184 100.00 2,364,184 2,102,200 100.00 2,102,200
Total 99,255,733 10,442,086 94,175,642 9,455,522

The movements in impairment allowance for accounts receivable are as follows:

2020
Opening balance Provision Reversal Write-off Other movements Closing balance
23,804,177 15,060,518 (12,166,489) (902,942) (5,264) 25,790,000

2019
Balance at Changes in
the end of accounting Opening Other
prior year policies balance Provision Reversal Write-off movements Closing balance
20,453,337 3,323,905 23,777,242 5,010,216 (4,340,373) (714,592) 71,684 23,804,177

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V. Notes to the consolidated financial statements (continued)

4. Accounts receivable (continued)

(2) Impairment allowance (continued)

The major amounts reversal or collection of 2020 are as follows:
Reason for Basis and rationality Amount of
reversal/ for determining the reversal/ Way of
collection provision for impairment collection collection
Accounts
Company 1 receivable of Collectively accrued 158,988 Cash
project collected
Accounts
Company 2 receivable of Collectively accrued 115,395 Cash
project collected
Accounts
Company 3 receivable of Individually accrued 79,156 Cash
project collected
Accounts
Company 4 receivable of Collectively accrued 73,780 Cash
project collected
Accounts
Company 5 receivable of Collectively accrued 62,060 Cash
project collected
Accounts
Individually and
Others receivable of 11,677,110 Cash
Collectively accrued
project collected
Total 12,166,489

(3) As at 31 December 2020, the five largest accounts receivable according to customers are analysed as follows:
Amount of Percentage of
Impairment total accounts
Amount allowance receivable
Total amount of the five largest accounts receivable 7,541,356 3,719,461 4.05%

As at 31 December 2019, the five largest accounts receivable according to customers are analysed as follows:
Amount of Percentage of
Impairment total accounts
Amount allowance receivable
Total amount of the five largest accounts receivable 5,694,178 2,107,983 3.20%

(4) The analysis of accounts receivable derecognised due to the transfer of financial assets are as follows:
For the year ended 31 December 2020, the amount of accounts receivable derecognised by the Group due to the transfer
of financial assets was RMB45,613,400 thousand (2019: RMB52,727,683 thousand), and the related expenses were
RMB2,200,204 thousand (2019: RMB2,330,684 thousand).
As at 31 December 2020 and 31 December 2019, accounts receivable that were pledged by the Group to banks for
borrowings are presented in details in Note V. 66.

5. Accounts receivable financing

31 December 2020 31 December 2019
Bank acceptance bills 3,788,082 3,674,166
The Group discounts and endorses some bank acceptance bills according to the needs of daily capital management.
Therefore, bank acceptance bills are classified as financial assets measured at fair value and their changes included in
other comprehensive income.
Accounts receivable financing that have been endorsed or discounted on the balance sheet date but not overdue are as
follows:
31 December 2020 31 December 2019
Derecognised Recognised Derecognised Recognised
Bank acceptance bills 1,883,153 1,110,596 796,241 503,737

As at 31 December 2020 and 31 December 2019, the Group measured impairment allowance based on the expected
credit loss of the entire lifetime. The bank acceptance bills held by the assessment was not subject to significant credit
risk, and the amount of expected credit loss was not significant.

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V. Notes to the consolidated financial statements (continued)

6. Prepayments

The ageing analysis of prepayments is as follows:

31 December 2020 31 December 2019
Carrying Percentage of Carrying Percentage of
amount total balance amount total balance
Within 1 year 37,140,758 87.92 47,496,343 86.23
1-2 years 2,166,342 5.13 5,939,701 10.78
2-3 years 2,056,042 4.87 854,178 1.55
Over 3 years 880,204 2.08 794,326 1.44
42,243,346 100.00 55,084,548 100.00

As at 31 Dec 2020, prepayments aged more than 1 year amounted to RMB5,102,588 thousand (31 December 2019:
RMB7,588,205 thousand), mainly including advances to subcontractors and prepayments for land use rights, where the
project is not completed, or land use permit has not been obtained.

As at 31 Dec 2020, the five largest prepayments to suppliers are as follows:

Percentage of
Amount total balance
Total amount of the five largest prepayments to suppliers 15,441,353 36.55%

As at 31 December 2019, the five largest prepayments to suppliers are as follows:

Percentage of
Amount total balance
Total amount of the five largest prepayments to suppliers 12,455,794 22.61%

7. Other receivables

31 December 2020 31 December 2019

Other receivables 54,626,721 53,186,521

The ageing analysis of other receivables is as follows:

31 December 2020 31 December 2019
Within 1 year 38,773,389 40,742,035
1 to 2 years 13,761,941 12,097,832
2 to 3 years 5,615,868 2,974,330
3 to 4 years 1,249,108 1,665,045
4 to 5 years 663,427 719,143
Over 5 years 1,322,441 2,069,458
Sub-total 61,386,174 60,267,843
Less: Impairment allowance (6,759,453) (7,081,322)
Total 54,626,721 53,186,521

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V. Notes to the consolidated financial statements (continued)

7. Other receivables (continued)

Natures of other receivables are as follows:

31 December 2020 31 December 2019
Deposits and petty cash receivable 20,848,096 25,925,286
Advances receivable 14,017,240 14,900,685
Receivables from related parties (Note X. 6) 6,958,959 2,852,687
Deposit receivable 3,118,642 3,358,517
Others 16,443,237 13,230,668
Sub-total 61,386,174 60,267,843
Less: Impairment allowance (6,759,453) (7,081,322)
Total 54,626,721 53,186,521

Changes in impairment allowance recognised for the 12-month ECLs and lifetime ECLs on other receivables are as follows:

2020
Stage 1 Stage 3
12-month expected Credit-impaired
credit losses financial assets
(Lifetime expected
credit losses) Total
Opening balance of the year 1,653,840 5,427,482 7,081,322
Changes due to the opening balance
– Transfer to Stage 3 (65,252) 65,252 –
– Transfer to Stage 1 50,584 (50,584) –
Provision 1,353,313 817,053 2,170,366
Reversal (928,508) (912,504) (1,841,012)
Write-off (25,231) (583,929) (609,160)
Others (13,756) (28,307) (42,063)
Closing balance of the year 2,024,990 4,734,463 6,759,453

2019
Stage 1 Stage 3
12-month expected Credit-impaired
credit losses financial assets
(Lifetime expected
credit losses) Total
Opening balance of the year 2,937,708 3,879,988 6,817,696
Changes due to the opening balance
– Transfer to Stage 3 (1,412,739) 1,412,739 –
– Transfer to Stage 1 138 (138) –
Provision 606,631 698,790 1,305,421
Reversal (337,400) (554,174) (891,574)
Write-off (93,221) (41,914) (135,135)
Others (47,277) 32,191 (15,086)
Closing balance of the year 1,653,840 5,427,482 7,081,322

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V. Notes to the consolidated financial statements (continued)

7. Other receivables (continued)

The gross carrying amount of other receivables contributed to changes in the impairment allowance are as follows:
2020
Stage 1 Stage 3
Credit-impaired
financial assets
12-month expected credit (Lifetime expected)
losses credit losses Total
Opening balance of the year 47,855,701 12,412,142 60,267,843
Changes due to the opening balance
– Transfer to Stage 3 (1,390,253) 1,390,253 –
– Transfer to Stage 1 177,612 (177,612) –
Provision 16,723,566 2,031,629 18,755,195
Reversal (14,550,517) (2,319,865) (16,870,382)
Write-off (25,231) (583,929) (609,160)
Others (33,082) (124,240) (157,322)
Closing balance of the year 48,757,796 12,628,378 61,386,174

2019
Stage 1 Stage 3
Credit-impaired
financial assets
12-month expected (Lifetime expected)
credit losses credit losses Total
Opening balance of the year 52,586,079 10,302,881 62,888,960
Changes due to the opening balance
– Transfer to Stage 3 (1,680,865) 1,680,865 –
– Transfer to Stage 1 6,879 (6,879) –
Provision 9,533,210 4,876,522 14,409,732
Reversal (12,452,203) (4,431,507) (16,883,710)
Write-off (93,221) (41,914) (135,135)
Others (44,178) 32,174 (12,004)
Closing balance of the year 47,855,701 12,412,142 60,267,843

The major amounts reversal or collection of 2020 is as follows:

Reason for
reversal/ Amount of Way of
collection Receivable collected reversal/collection collection
Receivable
Company 1 Collectively accrued 149,579 Cash
collected
Receivable
Company 2 Individually accrued 51,191 Cash
collected
Receivable
Company 3 Collectively accrued 50,718 Cash
collected
Receivable
Company 4 Individually accrued 32,312 Cash
collected
Receivable
Company 5 Collectively accrued 28,395 Cash
collected
Receivable Individually and
Others 1,528,817 Cash
collected Collectively accrued
Total 1,841,012

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V. Notes to the consolidated financial statements (continued)

7. Other receivables (continued)

As at 31 December 2020, other receivables from the five largest customers are as follows:
Impairment
% of allowance
Amount total balance Nature Ageing Amount
Company 1 1,596,657 2.60 Account current Within 1 year 63,866
Company 2 1,135,984 1.85 Account current Within 1 year 11,360
Company 3 1,125,658 1.83 Cash deposit Within 1 year, 1 to 2 years 25,513
Company 4 918,000 1.50 Account current Within 1 year, 1 to 2 years 47,040
Company 5 790,500 1.29 Cash deposit Within 1 year 15,810
Total 5,566,799 9.07 163,589

As at 31 December 2019, other receivables from the five largest customers are as follows:
Impairment
% of allowance
Amount total balance Nature Ageing Amount
Company 1 1,000,000 1.66 Cash deposit 1 to 2 years 40,000
Company 2 904,000 1.50 Cash deposit Within 1 year 18,080
Company 3 662,700 1.10 Cash deposit Within 1 year 13,254
Company 4 627,858 1.04 Cash deposit Within 1 year 1,884
Company 5 620,000 1.03 Cash deposit Within 1 year 12,400
Total 3,814,558 6.33 85,618

8. Inventories

31 December 2020 31 December 2019

Carrying Impairment Carrying Impairment
amount provision Net value amount provision Net value
Properties under
575,666,522 (3,537,411) 572,129,111 489,478,279 (3,580,736) 485,897,543
development
Completed properties for
79,177,264 (557,024) 78,620,240 67,414,180 (585,909) 66,828,271
sale
Raw materials 20,157,082 (17,803) 20,139,279 22,474,381 (30,933) 22,443,448
Work in progress 702,632 – 702,632 1,133,413 – 1,133,413
Finished goods 3,292,729 (60,411) 3,232,318 2,487,860 (2,022) 2,485,838
Others 301,748 – 301,748 129,615 (508) 129,107
Total 679,297,977 (4,172,649) 675,125,328 583,117,728 (4,200,108) 578,917,620

As at 31 December 2020 and 31 December 2019, the inventories that were pledged by the Group to banks for borrowings
are presented in details in Note V. 66.

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V. Notes to the consolidated financial statements (continued)

8. Inventories (continued)

The details of properties under development are as follows:

Estimated
Date of Estimated completion 31 December 31 December
Project Name commencement completion time investment 2020 2019
Beijing Daji Critical Reform Project January 2003 December 2025 43,707,456 19,941,813 11,350,126
Beixin’an Shantytowns Renovation Project July 2014 August 2022 30,360,089 10,964,057 14,571,619
Beijing Fengtai Zaojia Village Project December 2019 September 2022 11,013,343 9,026,767 8,648,163
Beijing Yizhuang Smart City Project December 2020 December 2022 11,845,214 8,465,780 –
Hong Kong Kai Tak 6575 Plot Project October 2019 June 2023 11,106,502 7,845,832 7,583,992
Beixin’an Area B 673B Plot June 2021 September 2023 10,580,950 7,191,143 –
Tianjin City Plaza March 2014 December 2025 22,926,270 7,183,919 5,365,556
Beijing Yinghai Second House Project November 2019 December 2021 11,120,266 6,655,173 8,511,483
Shenzhen Bright Project December 2019 November 2021 72,405,516 6,612,058 5,722,771
Splendid Capital of China Construction August 2018 June 2021 9,500,000 6,368,569 6,548,131
Dalian CITIC Harbour City January 2013 December 2023 10,000,000 5,967,414 7,419,842
Shenzhen Zhonghai Huideli Garden March 2020 June 2022 6,567,734 5,896,908 –
Guangzhou Haizhu Daganwei land Project February 2020 June 2022 7,219,271 5,819,840 2,551,180
Beijing Shougangyuan Phase II Project April 2020 June 2021 7,659,878 5,793,189 –
Jinan Zhonghai Huashanlongcheng Project July 2014 July 2022 50,021,918 5,762,069 10,220,080
Shanghai Hongkou District Duolun Road Project November 2015 December 2025 10,940,594 5,727,704 –
Chongqing Shili Yangtze River Project July 2019 September 2021 5,676,283 5,676,283 –
Shanghai Hongqi Village August 2018 December 2022 16,370,270 5,649,873 11,827,900
Zhuheng Land Reserve 2020-06 Lot March 2021 December 2024 14,708,579 5,446,240 –
Zhongjian Bo Mansion September 2018 December 2024 7,744,760 5,345,412 4,969,644
Zhongjian Star City January 2019 June 2023 7,542,810 5,179,597 210,808
Wenhan Lake Project October 2020 June 2023 6,984,616 5,027,679 –
Zhongjian Tianfu Mansion Phase I July 2018 December 2024 9,796,000 4,953,608 5,786,710
Beijing Jinzhan Project September 2020 December 2021 6,534,900 4,900,729 –
Beijing Shijingshan Shougang Park Project March 2019 June 2021 6,267,173 4,743,854 5,542,646
Chengdu Qinhuang Temple 667 Project July 2018 July 2024 20,618,446 4,717,380 5,125,903
Tianjin Park City May 2013 December 2022 16,813,110 4,658,130 5,653,885
Beijing Lichun Lake Villa July 2018 December 2021 8,098,912 4,649,489 4,085,761
Guangzhou Nanzhou Road Project March 2021 October 2023 5,757,869 4,612,555 –
Xiamen Jimei Project 2019JP01 September 2019 June 2021 4,959,500 4,586,903 3,942,543
Changsha Wenjin Famous Garden December 2019 December 2021 6,064,421 4,435,268 3,604,574
Guiyang Zhonghai Yingshan Lake Project February 2020 December 2022 6,626,460 4,249,586 3,775,809
Beijing Company Rice Field Project November 2020 December 2022 5,602,640 4,199,387 –
Ningbo Haishugaotang Project December 2019 December 2022 5,500,000 4,159,824 3,700,548
Beijing Shougangyuan Phase III Project August 2020 June 2022 5,027,540 3,871,233 –
Nanjing Xiyuan Mansion July 2018 December 2021 9,200,000 3,755,828 6,257,178
Kai Tak No. 6603 October 2021 March 2025 5,662,945 3,608,982 –

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V. Notes to the consolidated financial statements (continued)

8. Inventories (continued)

The details of properties under development are as follows: (continued)

Estimated
Date of Estimated completion 31 December 31 December
Project Name commencement completion time investment 2020 2019
Changsha Group A Project October 2020 May 2022 6,000,000 3,603,204 –
246 Xiangshan’s Island Project December 2020 June 2025 3,495,340 3,495,340 –
Suzhou Gangtian South Road April 2019 June 2021 4,604,920 3,347,864 3,697,639
Dalian Zhonghai Park Uptown Project November 2019 December 2021 5,595,980 3,313,806 3,175,284
Hangzhou Zhonghai Cuiyuan Project March 2019 December 2020 4,278,711 3,215,471 3,614,765
COA 99 Hudson February 2016 August 2020 5,707,254 3,153,988 4,524,112
Zhengzhou Zhonghai Ground 13# May 2020 December 2021 4,100,000 3,101,924 2,252,598
Shenzhen Zhonghai Minzhi Project March 2021 April 2023 4,264,120 3,085,106 –
Changsha Zhongjian Jinghe City Project March 2018 June 2022 4,100,000 3,035,156 2,442,507
Dalian Taigu Square Project December 2021 December 2027 4,000,000 2,999,786 2,999,786
Shenyang East Consulate Project October 2020 December 2022 4,666,580 2,964,851 –
Jianguo East Road 69th Street July 2022 June 2025 35,754,365 2,947,874 35,874
Shanghai Xiaokunshan Phase II November 2019 November 2021 3,369,890 2,924,364 2,744,751
Shanghai Jianguoli Project June 2019 November 2021 4,314,637 2,886,319 3,621,602
Zhonghai Songshan Lake Garden January 2021 December 2022 4,524,794 2,856,055 –
Beijing Gongchen Street Office Project November 2020 June 2022 4,569,990 2,808,840 –
Zhengzhou Zhonghai Markham Mansion March 2018 December 2021 3,052,699 2,807,376 2,556,936
Tianjin Meilin Road Project November 2019 December 2021 3,207,121 2,796,351 1,179,195
Wuhan Zuoling Project June 2020 May 2022 4,949,630 2,777,922 –
Zhongjian Yuhu No.1 January 2018 December 2025 3,600,000 2,701,863 –
Wuhan Zhongjian Yujingxingcheng January 2015 December 2020 8,500,000 2,672,891 3,050,268
Wuxi Xinwu District Project April 2017 June 2020 3,301,816 2,645,821 2,164,193
Shenyang Zhonghai Huideli January 2021 June 2022 4,268,144 2,620,731 –
Suzhou Yundong Project April 2020 August 2022 3,820,000 2,538,545 –
Changchun Shengbei Street Project Lot 5 April 2019 December 2021 3,557,004 2,514,815 2,448,983
Xiamen T2016P02 Project September 2017 January 2021 3,783,959 2,420,655 2,318,454
Tianjin Eco-City Project May 2017 October 2022 3,249,670 2,398,613 2,189,259
Beijing Zhongjian Guowangfu Project December 2013 December 2021 4,000,000 2,385,168 2,641,659
Taiyuan North Lihua Project December 2020 May 2023 4,167,970 2,384,308 –
Wuhan Zhongjian Grand Mansion (K2/K4) January 2015 December 2021 13,498,480 2,374,818 3,055,395
Beijing Shunyi District Houshayu Town No. 19 Block
September 2019 December 2021 3,004,890 2,374,572 2,117,842
Shared Property House
Taiyuan Beihan Village Urban Reform Project May 2019 December 2021 5,263,003 2,348,705 3,264,568
Fangshanyin January 2021 December 2022 3,126,430 2,304,086 –
Guangzhou Guanggang 225-B Lot Project September 2019 December 2021 2,669,910 2,284,082 2,065,696
Kunming Dongbaisha River Ground A2 April 2018 December 2021 3,217,100 2,245,072 1,950,430

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V. Notes to the consolidated financial statements (continued)

8. Inventories (continued)

The details of properties under development are as follows: (continued)

Estimated
Date of Estimated completion 31 December 31 December
Project Name commencement completion time investment 2020 2019
Shijiazhuang Zhonghai·Yunjin June 2020 June 2022 3,564,029 2,241,600 –
Kafu Project March 2018 June 2021 2,854,214 2,132,379 1,823,376
Xujiang’an Garden January 2021 December 2021 3,364,040 2,113,581 –
Yuelin Xi’an July 2019 April 2021 2,486,988 2,102,723 1,785,010
Ningbo Huaishu Plot August 2020 July 2022 3,055,590 2,097,821 983,693
Kunming Wujiaba Project December 2018 December 2021 5,879,812 2,088,652 3,601,369
Taiyuan Comprehensive Reform Zone Yangzhuang
October 2020 December 2021 6,509,280 2,083,118 –
Project
Zhongjian·Splendid World Zone B and C April 2018 June 2020 2,889,406 2,067,294 1,643,878
Jinan Railway Vocational and Technical College
January 2019 January 2021 3,240,153 2,054,547 1,836,315
D-2BX plot
Wanning D/E/H Plot Project November 2018 April 2025 7,634,687 2,041,429 1,886,456
Chongqing Geneva Project September 2012 December 2024 15,716,018 2,029,082 2,280,411
Universe Times January 2021 September 2022 2,022,853 2,022,853 –
Hangzhou Xiangqifang Project May 2018 July 2020 2,411,462 2,019,802 2,274,330
China Construction Huafu-B Lot-Real Estate July 2014 December 2021 5,700,000 2,019,618 1,954,845
Hongqi Village E03-03 Plot July 2020 March 2023 3,003,900 2,000,696 1,033
Others 223,564,910 256,318,915
Total 575,666,522 489,478,279

The details of completed properties held for sale are as follows:

2020
Completion time
of the latest 31 December 31 December
Project Name phase 2019 Additions Deductions 2020
Nanjing Xiyuan Mansion December 2020 – 3,294,494 (436,227) 2,858,267
Shanghai Jiufengli Phase I Project March 2019 2,101,601 – (53,121) 2,048,480
Chengdu Zhonghai Yunlushijia December 2020 910,553 2,406,345 (1,781,149) 1,535,749
Jiangsu Runjiangfu Project June 2019 1,747,317 19,000 (233,316) 1,533,001
Tianjin Park City June 2020 788,922 1,866,901 (1,158,995) 1,496,828
Dalian CITIC Harbour City September 2020 1,241,824 2,277,123 (2,029,022) 1,489,925
West Coast Gufang Residential Land Real Estate
December 2020 1,221,773 311,297 (57,264) 1,475,806
Development Project
Jinan Bright Yuefu Project November 2020 – 1,835,588 (408,755) 1,426,833
Jinan Zhonghai Huashanlongcheng Project December 2020 706,901 7,307,770 (6,603,128) 1,411,543
Zhonghai Yonghexi’an Mansion November 2019 1,541,517 18,721 (262,806) 1,297,432
Dabu Lychee Hill Project December 2020 – 7,597,064 (6,324,812) 1,272,252
Chengdu Zhonghai Yunlushijia December 2020 98,145 2,736,634 (1,578,072) 1,256,707
Zhaoqing Zhonghai New City Mansion September 2019 1,341,723 – (128,338) 1,213,385

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V. Notes to the consolidated financial statements (continued)

8. Inventories (continued)

The details of properties under development are as follows: (continued)

2020 (continued)

Completion time
of the latest 31 December 31 December
Project Name phase 2019 Additions Deductions 2020
Zhonghai Yunzhu November 2020 – 4,326,227 (3,121,529) 1,204,698
Foshan Yunlu Residence December 2019 1,368,441 285,229 (475,366) 1,178,304
Chongqing Lixianghu Project December 2019 744,834 281,351 (11,727) 1,014,458
Zhonghai Shijihui Garden January 2020 – 1,256,391 (250,473) 1,005,918
Jilin Changchun Zhonghai Shengshi City C December 2020 711,235 405,025 (130,343) 985,917
Zhongjian·No.7 Yard Project December 2020 – 2,839,155 (1,860,788) 978,367
China-Construction-Chi Cube (Hefei China
December 2018 844,686 130,060 (102,509) 872,237
Construction Industrial Base)
Songjiang Cyan-yunzhu Project October 2020 – 2,011,441 (1,141,005) 870,436
Zhonghai Wanjin Mansion December 2020 841,985 2,369,168 (2,360,959) 850,194
Hangzhou C19 Project June 2020 – 2,409,116 (1,589,559) 819,557
Kowloon Peak June 2015 827,389 – (38,332) 789,057
Kunming Zhonghai Yunzhu December 2019 2,146,223 34,460 (1,406,455) 774,228
Nanchang Zhonghai Yangguang Rose Garden June 2020 891,184 295,320 (418,732) 767,772
COA 99 Hudson December 2020 – 1,683,298 (917,265) 766,033
Zhengzhou Zhonghaiyiyuan December 2019 884,611 124,856 (263,921) 745,546
Zhonghai City Phase IX December 2020 – 1,307,624 (586,044) 721,580
Plot F of Chongqing Guanyin Bridge December 2019 808,891 – (109,319) 699,572
Guiyang Dayingpo Zhongjian Huafu Project ADEF
December 2017 801,041 21,855 (123,996) 698,900
District
Urban Resident Resettlement Project December 2020 – 1,779,765 (1,082,132) 697,633
Tianjin City Plaza June 2020 798,812 433,093 (539,657) 692,248
Lot 12-41, No. 1 Yulu Road, Hangzhou December 2020 779,284 62,676 (165,785) 676,175
Lot No. 42, No. 1 Royal Road, Hangzhou December 2020 680,101 32,856 (38,233) 674,724
Zhonghai Wansongjiuli March 2020 – 1,336,585 (662,737) 673,848
Chengdu Zhonghai Jinjiangcheng December 2020 295,501 1,643,073 (1,270,933) 667,641
Fuzhou Zhonghai Phoenix Xi’an December 2020 – 1,535,656 (920,499) 615,157
Qingdao Jimo Linghai·Shangxi Land Project Phase I December 2020 185,803 1,131,390 (705,183) 612,010
Foshan Markham Mansion December 2020 135,213 849,100 (373,375) 610,938
Fuzhou Zhonghai Jinxi Mansion December 2019 913,868 41,308 (345,238) 609,938
Zhonghai Universe World December 2020 – 2,473,182 (1,868,440) 604,742
Zhonghai Hongzhu Project December 2019 698,473 – (103,485) 594,988
Zhonghai Jinjia Huating June 2018 1,290,288 – (705,296) 584,992
Yuelu Mountain December 2020 – 2,146,831 (1,564,882) 581,949
Tsingdao Linxishijia Project June 2020 – 1,159,316 (588,029) 571,287
Chengdu Zhonghai Yuhushijia December 2019 1,367,934 13,414 (815,886) 565,462
Chongqing Zhongjian Longxitai December 2020 – 1,512,788 (949,148) 563,640

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V. Notes to the consolidated financial statements (continued)

8. Inventories (continued)

The details of completed properties held for sale are as follows: (continued)

2020 (continued)

Completion time
of the latest 31 December 31 December
Project Name phase 2019 Additions Deductions 2020
Chongqing Dayang Stone Block L December 2020 153,458 791,474 (387,430) 557,502
Zhonghai·Shangwan December 2020 148,922 1,135,599 (728,117) 556,404
Goya Park Project September 2020 – 835,870 (283,823) 552,047
Jilin Changchun Zhonghai·Shangxue Mansion
December 2020 – 1,179,262 (629,810) 549,452
Phase III
Hongkou Rainbow Bay Phase IV June 2020 – 6,496,836 (5,956,163) 540,673
Tsingdao Zhonghai Lanting Project June 2020 2,416 1,604,438 (1,080,048) 526,806
Chongqing International Community Project October 2015 – 559,602 (35,431) 524,171
Jinan Zhongjian Changqinghu Project October 2020 617,651 1,976,411 (2,092,945) 501,117
Zunyi Zhongjian Xingfucheng Phase I October 2020 17,019 939,222 (460,805) 495,436
Shenyang Banshanhuafu Project August 2020 994,785 1,380,643 (1,886,260) 489,168
Wangjing House December 2020 – 1,472,265 (1,017,527) 454,738
Nanchang Zhonghai Jincheng Garden June 2020 444,922 787,323 (790,804) 441,441
Guangzhou Zhonghai Jinyuhuating June 2018 637,426 – (213,597) 423,829
Zhonghai Lichun Lake Villa December 2020 1,320,747 65,572 (986,803) 399,516
Chengdu CITIC City Right Bank Phase I December 2018 420,000 – (43,378) 376,622
Beixin’an Shantytowns Renovation Project June 2020 263,798 4,219,691 (4,108,582) 374,907
China Overseas Jincheng International November 2020 – 597,304 (224,976) 372,328
Fuzhou Zhonghai Jincheng Garden December 2019 407,113 36,178 (82,005) 361,286
Kunming Yunlujiuli Phase I June 2018 777,342 – (430,110) 347,232
Jinan West Railway Station Project_2011-G086 December 2020 – 495,525 (150,962) 344,563
Zhonghai Jincheng June 2020 – 1,583,710 (1,252,832) 330,878
Zhonghai Chang’an Mansion May 2020 – 2,676,404 (2,347,911) 328,493
Chongqing Zhongjian Yuhe City (Phase I) December 2020 335,417 – (8,963) 326,454
Xi’an Zhonghai Yuelishan Project B December 2020 232,952 550,922 (461,998) 321,876
Zhonghai·Yunding Grand View Project Phase I November 2020 355,088 997,348 (1,032,964) 319,472
Tianjin Yuetaijiayuan Project June 2020 – 507,865 (191,328) 316,537
Zhengzhou Zhonghai Wanjinxi’an December 2020 599,685 170,718 (459,274) 311,129
Zhonghai Tangyuan December 2020 131,346 657,029 (482,646) 305,729
Yeji Standardized Plant Project December 2020 310,048 109,003 (118,517) 300,534
Others 29,527,972 118,913,572 (127,970,974) 20,470,570
Total 67,414,180 216,342,332 (204,579,248) 79,177,264

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V. Notes to the consolidated financial statements (continued)

8. Inventories (continued)

Movements in the carrying amount of inventories are as follows:

2020
31 December 31 December
2019 Additions Deductions 2020
Properties under development 489,478,279 317,783,688 (231,595,445) 575,666,522
Completed properties held for sale 67,414,180 216,342,332 (204,579,248) 79,177,264
Raw materials 22,474,381 522,878,924 (525,196,223) 20,157,082
Work in progress 1,133,413 2,894,359 (3,325,140) 702,632
Finished goods 2,487,860 43,730,456 (42,925,587) 3,292,729
Others 129,615 2,723,831 (2,551,698) 301,748
Total 583,117,728 1,106,353,590 (1,010,173,341) 679,297,977

2019

Changes in
31 December accounting 1 January 31 December
2018 policies 2019 Additions Deductions 2019
Properties under
438,262,888 – 438,262,888 248,348,016 (197,132,625) 489,478,279
development
Completed properties held
40,684,570 – 40,684,570 176,252,184 (149,522,574) 67,414,180
for sale
Accounts due from
138,643,734 (138,643,734) – – – –
customers
Raw materials 20,742,166 – 20,742,166 293,146,263 (291,414,048) 22,474,381
Work in progress 1,356,614 – 1,356,614 2,956,217 (3,179,418) 1,133,413
Finished goods 1,992,013 – 1,992,013 33,416,159 (32,920,312) 2,487,860
Others 238,329 – 238,329 18,903,716 (19,012,430) 129,615
Total 641,920,314 (138,643,734) 503,276,580 773,022,555 (693,181,407) 583,117,728

Movements in the impairment provision of inventories are as follows:

2020

1 January Increase during the year Decrease during the year 31 December
2020 Accrual Others Reversal Write-off Others 2020
Properties under development 3,580,736 400,000 (372,226) – – (71,099) 3,537,411
Completed properties held for
585,909 106,862 372,226 (386,092) (121,881) – 557,024
sale
Raw materials 30,933 4,110 – (39) (24,514) 7,313 17,803
Finished goods 2,022 59,266 – (126) (751) – 60,411
Others 508 – – (508) – – –
Total 4,200,108 570,238 – (386,765) (147,146) (63,786) 4,172,649

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V. Notes to the consolidated financial statements (continued)

8. Inventories (continued)

Movements in the impairment provision of inventories are as follows: (continued)

2019

Changes in Increase during the year Decrease during the year

31 December accounting 1 January 31 December
2018 policies 2019 Accrual Others Reversal Write-off Others 2019
Properties under development 4,666,392 – 4,666,392 928,975 (941,883) (911,487) (173,501) 12,240 3,580,736
Completed properties held for sale 654,816 – 654,816 148,336 941,883 (358,049) (801,074) (3) 585,909
Accounts due from customers 1,588,924 (1,588,924) – – – – – – –
Raw materials 33,437 – 33,437 1,388 – (107) (3,543) (242) 30,933
Finished goods 1,039 – 1,039 2,451 – – (1,468) – 2,022
Others 8,612 – 8,612 – – (1,687) (6,417) – 508
Total 6,953,220 (1,588,924) 5,364,296 1,081,150 – (1,271,330) (986,003) 11,995 4,200,108

Impairment provision of inventories is as follows:

Reasons of reversal
Net realisable value and write-off during the year
Properties under development Expected selling price less estimated costs to be incurred
Net realisable value increased or
Completed properties held for sale at completion, the estimated selling expenses and the
  sales realised
Raw materials relevant taxes and fees

9. Contract assets

31 December 2020 31 December 2019

Receivables from Construction projects 139,279,091 152,335,478
Project quality warranty 82,495,557 86,371,554
Receivables from PPP projects 82,535,009 68,660,734
Primary land development 11,103,922 10,145,212
Others 8,548,233 8,575,772
Sub-total 323,961,812 326,088,750
Less: Impairment allowance (5,331,689) (5,584,007)
318,630,123 320,504,743
Less: Contract assets disclosed within Current portion of non-current assets (Note V.10) (39,798,227) (24,598,890)
Less: Contract assets disclosed within the other non-current assets (Note V. 23) (137,765,940) (144,930,527)
141,065,956 150,975,326
Including: original value of contract assets 143,392,926 153,955,659
     impairment allowance of contract assets (2,326,970) (2,980,333)

The Group provides construction services to customers and revenue recognised based on performance progress in
excess of progress billings is presented as contract assets. Upon settlement with the customers, the Group has an
unconditional rights to receivable payments and the amounts recognised as contract assets are reclassfied to trade
receivables.

Changes in impairment allowance of contract assets are as follows:

For the year ended 31 December 2020

1 January 2020 Provision Reversal Other changes 31 December 2020

5,584,007 1,594,339 (1,779,231) (67,426) 5,331,689

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V. Notes to the consolidated financial statements (continued)

9. Contract assets (continued)

Changes in impairment allowance of contract assets are as follows: (continued)

For the year ended 31 December 2019

Changes in
31 December accounting 31 December
2018 policies 1 January 2019 Provision Reversal Other changes 2019
– 4,164,628 4,164,628 2,028,522 (688,483) 79,340 5,584,007

The changes in the impairment allowance of the current part of contract assets are as follows:

For the year ended 31 December 2020

1 January 2020 Provision Reversal Other changes 31 December 2020
2,980,333 327,307 (943,678) (36,992) 2,326,970

For the year ended 31 December 2019

Changes in
31 December accounting 31 December
2018 policies 1 January 2019 Provision Reversal Other changes 2019
– 2,042,926 2,042,926 1,407,818 (350,747) (119,664) 2,980,333

Whether the contract assets have significant financing components or not, the impairment allowance is measured
according to the expected credit loss for the whole lifetime.
31 December 2020
Gross Carrying amount Impairment allowance
Amount Ratio (%) Amount Ratio (%)
Impairment of individually accrued 20,488,216 14.29 1,536,364 7.50
Impairment of collectively accrued by
122,904,710 85.71 790,606 0.64
credit risk portfolio
Total 143,392,926 100.00 2,326,970 1.62

31 December 2019
Gross Carrying amount Impairment allowance
Amount Ratio (%) Amount Ratio (%)
Impairment of individually accrued 21,006,351 13.64 2,086,758 9.93
Impairment of collectively accrued by
132,949,308 86.36 893,575 0.67
credit risk portfolio
Total 153,955,659 100.00 2,980,333 1.94

As at 31 December 2020, contract assets individually assessed for expected credit losses are as follows:
Carrying Impairment ECLs rate for the
amount allowance entire lifetime (%) Reasons
Company 1 475,087 3,448 0.73 Note
Company 2 210,724 94,826 45.00 Note
Company 3 160,633 245 0.15 Note
Company 4 151,717 33,632 22.17 Note
Company 5 138,313 99,279 71.78 Note
Others 19,351,742 1,304,934 6.74 Note
Total 20,488,216 1,536,364

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V. Notes to the consolidated financial statements (continued)

9. Contract assets (continued)

As at 31 December 2019, contract assets individually assessed for expected credit losses are as follows:
Carrying Impairment ECLs rate for the
amount allowance entire lifetime (%) Reasons
Company 1 498,430 149,526 30.00 Note
Company 2 243,872 243,872 100.00 Note
Company 3 190,270 13,319 7.00 Note
Company 4 138,059 8,926 6.47 Note
Company 5 121,618 121,618 100.00 Note
Others 19,814,102 1,549,497 7.82 Note
Total 21,006,351 2,086,758

Note: The Group provides construction services to customers above. Due to the shortage of funds of the customers, the
Group expected some contract assets are difficult to be settled and impairment allowance is provided accordingly.

The terminated contract assets by the Group are presented in detail in Note V. 4.

As at 31 December 2020 and 31 December 2019, the contract assets that were pledged by the Group to banks for
borrowings are presented in detail in Note V. 66.

10. Current portion of non-current assets

31 December 2020 31 December 2019

Current portion of long-term receivables (Note V. 13) 30,009,625 25,035,289
Current portion of contract assets (Note V. 9) 39,798,227 24,598,890
Current portion of debt Investments (Note V. 12) 7,805,981 7,704,140
Current portion of long-term receivables (Note V. 13) 182,608 –
Others 140,288 125,385
Total 77,936,729 57,463,704

11. Other current assets

31 December 2020 31 December 2019

Input VAT to be credited 39,093,862 37,309,124
Prepaid taxes 29,910,131 25,737,409
Receivables from related parties (Note X. 6) 14,963,744 15,394,226
Short term debt investments measured at amortization cost 5,067,518 4,088,801
Others 6,807,172 6,933,795
Sub-total 95,842,427 89,463,355
Less: Impairment allowance (1,531,269) (1,483,067)
Total 94,311,158 87,980,288

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V. Notes to the consolidated financial statements (continued)

12. Debt investments

31 December 2020
Carrying Impairment
amount allowance Net amount
Loans receivable from related parties (Note X. 6) 19,183,824 (4,669) 19,179,155
Entrusted loans 1,064,002 (5,816) 1,058,186
  Including: Entrusted loans from related parties (Note X. 6) 370,923 (3,709) 367,214
Others 2,179,711 (5,742) 2,173,969
Sub-total 22,427,537 (16,227) 22,411,310
Less: Debt investments of non-current assets due within
7,806,980 (999) 7,805,981
     one year (Note V. 10)
Total 14,620,557 (15,228) 14,605,329

31 December 2019
Carrying Impairment
amount allowance Net amount
Loans receivable from related parties (Note X. 6) 20,882,550 (11,322) 20,871,228
Entrusted loans 1,557,389 (7,300) 1,550,089
  Including: Entrusted loans from related parties (Note X. 6) 370,923 (3,709) 367,214
Others 3,066,176 (23,549) 3,042,627
Sub-total 25,506,115 (42,171) 25,463,944
Less: Debt investments of non-current assets due within
7,706,029 (1,889) 7,704,140
    one year (Note V. 10)
Total 17,800,086 (40,282) 17,759,804

13. Long-term receivables

31 December 2020 31 December 2019

Receivables from PPP projects 90,254,972 61,254,205
Receivables from BT projects 59,661,593 60,664,928
Primary land development 30,117,104 35,654,938
Receivables from other construction projects 26,256,240 29,338,504
Project quality warranty 2,417,273 2,717,374
Due from related parties (Note X. 6) 34,600 313,695
Others 783,974 1,052,577
Sub-total 209,525,756 190,996,221
Less: impairment allowance 1,874,089 1,135,270
Sub-total 207,651,667 189,860,951
Less: due within 1 year (Note V. 10) 30,009,625 25,035,289
Total 177,642,042 164,825,662

As at 31 December 2020 and 31 December 2019, the Group pledged long-term receivables to banks for borrowings are
presented in detail in Note V. 66.

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V. Notes to the consolidated financial statements (continued)

14. Long-term equity investments

31 December 2020 31 December 2019

Joint ventures 39,920,192 34,648,316
Associates 46,812,925 40,562,641
Sub-total 86,733,117 75,210,957
Less: Impairment allowance 294,056 294,056
Total 86,439,061 74,916,901

2020

(a) Joint ventures

Movement during the year
Investment Other Impairment
Opening Increase/ profits/(losses) comprehensive Closing allowance at
Balance of the (Decrease) under equity income Declaration of Others balance of the end of
year investment method adjustment cash dividends (Note1) the year the year
Guizhou Zhengxi Expressway Investment Management Co., Ltd. 2,302,726 150,610 (53) (465) – – 2,452,818 –
Guiheng Investment Co., Ltd. 2,219,804 – 193,287 – – – 2,413,091 –
CITIC Baolida Real Estate (Foshan) Co., Ltd. 1,927,320 – (1,566) – – – 1,925,754 292,462
Zunyi Nanhuan Expressway Development Co. Ltd. (Note 2) 1,132,736 100,000 170,227 – – – 1,402,963 –
Zhengzhou CSCEC Shenzhen Rail Transit Co., Ltd. 325,180 704,240 (331) – – – 1,029,089 –
Nanjing Second Yangtze River Bridge Co., Ltd. 1,103,558 – 86,814 (678) (179,558) – 1,010,136 –
Guizhou Leirong Expressway Investment Management Co., Ltd. 459,486 497,993 – 46,868 – – 1,004,347 –
Shanghai Lingbo Haihui City Construction and Development Co., Ltd 960,360 – (13,577) 887 – – 947,670 –
Shanghai Lingang New District Jingang Dongjiu Real Estate Co., Ltd – 911,400 – – – – 911,400 –
Shenzhen CSCEC Win-win No. 8 Infrastructure Investment Center (LP) 1,000,000 (150,000) 74,620 – (74,620) – 850,000 –
China Overseas Southern Airlines Construction & Development
817,998 – 7,132 – – – 825,130 –
Co., Ltd.
Liupanshui urban pipe gallery construction and Development
795,597 – (663) – – – 794,934 –
Investment Co., Ltd.
Beijing Nanyue Real Estate Development Co., Ltd. 728,933 – 35,985 – – – 764,918 –
Anhui Bengwu Expressway Investment Management Co., Ltd. 605,617 135,426 – (385) – – 740,658 –
Guangdong Guotong Logistics City Co., Ltd. – 661,835 5,139 4 – – 666,978 –
CSCEC Road & Bridge Group Co., Ltd. 607,293 – 45,381 (247) – 9,392 661,819 –
Mianyang Zhongjian Kefa Guanlang Road Investment and
316,757 240,000 (3,851) – – – 552,906 –
Construction Co., Ltd.
Changsha CSCEC Chengtou Pipe Well Development
528,106 – 5,686 – – – 533,792 –
Investment Co., Ltd.
China Construction Haijia (Foshan) Investment and
522,661 – 10,985 (6,393) – – 527,253 –
Construction Co., Ltd.
Shaotong CSCEC Construction Investment & Development Co. Ltd. 504,445 – 6,928 – – – 511,373 –
China Construction (Tianjin) Rail Transit Investment
245,681 233,143 – – – – 478,824 –
Development Co., Ltd.
Urumqi Zhongcheng Silk Road Sports Management Co., Ltd. 488,671 – (10,850) – – – 477,821 –
China Construction (Tangshan Caofeidian) Engineering
463,456 – 11,299 (2,199) – – 472,556 –
Construction Co., Ltd.
Hebei Road and Bridge Group Co., Ltd. 409,465 – 30,254 (165) – – 439,554 –
Others 16,182,466 3,061,271 2,097,169 (104,320) (1,473,123) (2,239,055) 17,524,408 1,358
Joint ventures sub-total 34,648,316 6,545,918 2,750,015 (67,093) (1,727,301) (2,229,663) 39,920,192 293,820

Note 1: Other changes are mainly caused by the changes in the investee’s other equity movement other than other comprehensive income
and the volatility of foreign exchange rate.

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V. Notes to the consolidated financial statements (continued)

14. Long-term equity investments (continued)

2020 (continued)

(b) Associates
Movement during the year

Investment Other Impairment

Opening Increase/ profits/(losses) comprehensive Closing allowance at
balance of (Decrease) under equity income Declaration of Others balance of the end of
the year investment method adjustment cash dividends (Note1) the year the year
China Overseas Grand Oceans Group Ltd. (“Overseas Oceans”) 7,489,769 – 1,676,410 396,722 (309,427) (5,622) 9,247,852 –
Anhui Guoyuan Trust Co., Ltd. 2,799,221 – 175,143 36,916 (32,966) 32,453 3,010,767 –
Jiqing Express Railway Co., Ltd. 2,082,659 322,490 (92,938) – – – 2,312,211 –
CCCC Jijiao Expressway Investment & Development Co., Ltd. 1,302,988 441,915 (82,245) – – – 1,662,658 –
Everbright Securities Co., Ltd. 1,460,733 – 72,704 24,240 (5,136) (99,357) 1,453,184 –
Sanmenxia National Highway 31-0 South Moving Project
900,000 342,936 – – – – 1,242,936 –
Construction Management Co., Ltd.
Yunnan Huali expressway investment and Development Co., Ltd. 790,000 395,000 – – – – 1,185,000 –
Xuzhou Line One Rail Transit Investment Development Co., Ltd. 790,000 300,000 – – – – 1,090,000 –
Guangzhou Lihe Real Estate Development Co., Ltd. 931,775 – 286,107 – (150,960) – 1,066,922 –
Shandong Qilu Ningliang Expressway Co., Ltd. 1,033,900 – – – – – 1,033,900 –
Fast Shift Investments Limited 1,155,792 – 416,601 – (490,372) (49,732) 1,032,289 –
Jinmao Investment (Changsha) Co., Ltd. 942,442 (150,000) 346,012 – (140,529) – 997,925 –
Anhui Guoyuan Investment Co., Ltd. 965,609 – 29,450 (1,560) (4,273) (201) 989,025 –
Shanghai Jiasheng Real Estate Development Co., Ltd. 931,354 – 55,788 – – – 987,142 –
Suzhou Fuyuan Real Estate Co., Ltd. – – (5,490) – – 971,760 966,270 –
Taiyuan Zhongyin Railway Co., Ltd. – 1,000,000 (113,394) – – – 886,606 –
Guangzhou fuchuang Real Estate Development Co., Ltd. – 680,000 (10,881) – – – 669,119 –
Chongqing Jinke Zhaoji Real Estate Development Co., Ltd. 586,430 – 26,310 – – – 612,740 –
Henan Xuxin Expressway Co., Ltd. – 576,600 – – – – 576,600 –
China State Construction Xi’an Urban Construction Investment
– 557,846 (8,980) – – – 548,866 –
Co., Ltd.
Liupanshui Dongda highway investment and Development Co., Ltd. 509,644 – 14 (8,056) – – 501,602 –
Shanxi International Power Group Real Estate Development Co., Ltd. 494,659 – – – – – 494,659 –
Zhengzhou public Zhongcheng road and Bridge Construction
415,000 62,658 – – – – 477,658 –
Management Co., Ltd.
Nanjing Zhongjian Rural Tourism Construction Investment Co., Ltd. – 419,290 – – – – 419,290 –
Other 14,980,666 (2,209,818) 397,509 (58,861) (324,251) 562,459 13,347,704 236
Associates sub-total 40,562,641 2,738,917 3,168,120 389,401 (1,457,914) 1,411,760 46,812,925 236
Total 75,210,957 9,284,835 5,918,135 322,308 (3,185,215) (817,903) 86,733,117 294,056

Note 1: Other changes are mainly caused by the changes in the investee’s other equity movement other than other comprehensive income
and the volatility of foreign exchange rate.

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V. Notes to the consolidated financial statements (continued)

14. Long-term equity investments (continued)

2019

(a) Joint ventures

Movement during the year
Investment Other Impairment
Opening Increase/ profits/(losses) comprehensive Closing allowance at
balance of (Decrease) under equity income Declaration of Others balance of the end of
the year investment method adjustment cash dividends (Note1) the year the year
Lang Light International Co., Ltd. 2,240,278 – (21,812) – – – 2,218,466 –
Nanjing Second Yangtze River Bridge Co., Ltd. 1,126,057 – 147,415 (443) (169,471) – 1,103,558 –
Speedy Champ Investments Limited 1,246,253 – 3,953 – – – 1,250,206 –
China Overseas Port (Laizhou) Co., Ltd. 618,087 – 62,685 (5,123) (65,409) – 610,240 –
Guiheng Investment Co., Ltd. 1,607,600 – 612,204 – – – 2,219,804 –
Shandong China Overseas Huachuang Real Estate Co., Ltd. 491,697 – (2,996) – – – 488,701 –
Tianjin Yingchao Real Estate Development Co., Ltd. 22,297 – 16,838 – – – 39,135 –
Xing Gui Investment Co., Ltd. 1,119,116 – 16,825 – (857,500) – 278,441 –
Xing Chuang Enterprise Co., Ltd. 356,997 – 67,572 – (76,500) – 348,069 –
CITIC Baolida Real Estate (Foshan) Co., Ltd. 1,879,043 – 48,277 – – – 1,927,320 292,462
China Overseas Southern Airlines Construction & Development
827,441 – (9,443) – – – 817,998 –
Co., Ltd.
Guizhou Zhengxi Expressway Investment Management Co., Ltd. 2,302,596 – 130 – – – 2,302,726 –
China Overseas Grand Oceans Haifu (Hefei) Real Estate
414,560 – 46,664 34,962 – – 496,186 –
Development Co., Ltd.
Changsha CSCEC Chengtou Pipeline Construction & Investment
508,230 19,800 76 – – – 528,106 –
Co. Ltd.
Chongqing Railway Line No. 9 Construction & Operation Co. Ltd. 1,600,751 (1,600,751) – – – – – –
CSCEC (Tangshang Caofeidian) Engineering & Construction Co., Ltd. 404,543 42,264 16,649 – – – 463,456 –
Xuzhou Line No. 3 Rail Transit Investment Development Co., Ltd. 109,784 1,000 (40) – – – 110,744 –
Changsha CSCEC Future Future Science and Technology City
104,197 – 837 – (2,167) – 102,867 –
Investment Co. Ltd.
Dazhou Dahuan Construction Management Co., Ltd. 292,517 – 154 – – – 292,671 –
Beijing Nanyue Real Estate Development Co., Ltd. 731,999 – (3,066) – – – 728,933 –
Shenzhen CSCEC Win-win No. 8 Infrastructure Investment Center (LP) 1,000,000 – 79,083 – (79,083) – 1,000,000 –
Zunyi Nanhuan Expressway Development Co., Ltd. (Note 2) 1,016,450 – 116,286 – – – 1,132,736 –
Shaotong CSCEC Construction Investment & Development Co., Ltd. 511,431 – (6,986) – – – 504,445 –
CSCEC Chengdu Rail Transportation Investment and Construction
375,477 – 124,546 – – – 500,023 –
Co., Ltd.
Shanghai Lingbo Haihui City Construction and Development Co., Ltd. – 960,360 – – – – 960,360 –
Others 10,661,722 2,547,518 467,460 3,610 (153,556) 696,371 14,223,125 1,358
Joint ventures sub-total 31,569,123 1,970,191 1,783,311 33,006 (1,403,686) 696,371 34,648,316 293,820

Note 1: Other changes are mainly caused by the changes in the investee’s other equity movement other than other comprehensive income
and the volatility of foreign exchange rate.

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V. Notes to the consolidated financial statements (continued)

14. Long-term equity investments (continued)

2019 (continued)

(b) Associates
Movement during the year
Investment Other Impairment
Opening Increase/ income/(losses) comprehensive Closing allowance at
balance of (Decrease) under equity income Distribution of Others balance of the end of
the year in investment method adjustment dividends (Note1) the year the year
Trust House Pte. Ltd. 9,067 – (2) – – 304 9,369 –
Beijing China Construction Zhongchao Concrete Co., Ltd. 14,299 – (4,164) – – – 10,135 –
DuYun Galactic Real Estate Development Co., Ltd. 35,399 – 6,628 – – – 42,027 –
Henan China Construction Municipal Construction Development
217,145 – 4,617 – – – 221,762 –
Co., Ltd.
Jinmao Investment (Changsha) Co., Ltd. 1,058,813 – 177,032 – (293,403) – 942,442 –
Anhui Guoyuan Investment Co., Ltd. 937,689 – 40,373 366 (12,819) – 965,609 –
Anhui Guoyuan Trust Co., Ltd. 2,694,495 – 182,794 (47,787) (30,281) – 2,799,221 –
China Overseas Grand Oceans Group Ltd. (“Overseas Oceans”) 6,529,917 – 1,275,934 (116,014) (196,548) (3,520) 7,489,769 –
Krimark Investment Ltd. 173,511 – (2,779) 14,856 – 2,378 187,966 –
Fast Shift Investments Limited 1,778,863 – 753,979 – (1,389,228) 12,178 1,155,792 –
Xuzhou Metro Line One Investment Development Co., Ltd. (Note 2) 196,000 594,000 – – – – 790,000 –
Jiqing Express Railway Co., Ltd. 2,116,643 20,272 (54,256) – – – 2,082,659 –
Guangzhou Lihe Real Estate Development Co., Ltd. 793,775 – 138,000 – – – 931,775 –
Suzhou Extraordinary City Real Estate Co., Ltd. 102,647 – 145,846 – (146,493) – 102,000 –
CCCC Jijiao Expressway Investment & Development Co., Ltd. 1,248,821 131,000 (76,833) – – – 1,302,988 –
Panjin Zhonghui Industry Co. Ltd. 333,263 – 21,194 – – – 354,457 –
Beijing Jinliang Xingye Real Estate Development Co., Ltd. 332,081 – 21,922 (17,669) – – 336,334 –
Shenzhen & Shantou Special Cooperation Area Harbour New City
193,269 – 6,485 – – – 199,754 –
Investment & Construction Co., Ltd.
Liuzhou CSCEC Dongcheng Culture Development Co., Ltd. 305,920 – 4,905 – – – 310,825 –
Guizhou Jianxin Water Environment Industry Co., Ltd. 219,177 – 4,393 – – – 223,570 –
Everbright Securities Co., Ltd. 1,422,013 – 24,568 4,624 (13,881) 23,409 1,460,733 –
CSCEC Jianxin Shared No. 9 Private-Equity Fund for Urbanization 1,206,248 – 37,551 – (75,338) – 1,168,461 –
Shangdong Qiru Ningliang Expressway Co., Ltd. 743,000 290,900 – – – – 1,033,900 –
Chongqing Jinke Zhaoji Real Estate Development Co., Ltd. 542,145 – 44,285 – – – 586,430 –
Urumchi New Chuyuan Construction Co., Ltd. 400,260 – (57) – – – 400,203 –
Shanghai Jiasheng Real Estate Development Co., Ltd 887,499 – 43,855 – – – 931,354 –
Yunnan Huali Expressway Investment and Development Co., Ltd.
– 790,000 – – – – 790,000 –
(Note 2)
Others 10,226,973 4,015,814 94,201 (175,742) (575,955) 147,815 13,733,106 236
Associates sub-total 34,718,932 5,841,986 2,890,471 (337,366) (2,733,946) 182,564 40,562,641 236
Total 66,288,055 7,812,177 4,673,782 (304,360) (4,137,632) 878,935 75,210,957 294,056

Note 1: Other changes are mainly caused by the changes in the investee’s other equity movement other than other
comprehensive income and the volatility of foreign exchange rate.

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V. Notes to the consolidated financial statements (continued)

14. Long-term equity investments (continued)

The movements in impairment allowance of long-term equity investments are as follows:

2020
Increase
Opening balance during Decrease during Closing balance
of the year the year the year of the year
CITIC Baolida Real Estate (Foshan) Co., Ltd. 292,462 – – 292,462
Others 1,594 – – 1,594
Total 294,056 – – 294,056

2019
Increase
Opening balance during Decrease during Closing balance
of the year the year the year of the year
CITIC Baolida Real Estate (Foshan) Co., Ltd. 292,462 – – 292,462
Others 1,594 – – 1,594
Total 294,056 – – 294,056

15. Investments in other equity instruments

31 December 2020 31 December 2019

Equity investments
  Listed equity investments 1,329,839 1,659,862
  Unlisted equity investments 4,508,545 6,409,181
Total 5,838,384 8,069,043

31 December 2020 31 December 2019

Equity investments
 Cost
   Listed equity investments 1,241,496 1,287,154
   Unlisted equity investments 3,899,738 5,349,115
  Cumulative changes in fair value
   Listed equity investments 88,343 372,708
   Unlisted equity investments 608,807 1,060,066
Total 5,838,384 8,069,043

2020

Changes Dividend income of the year Reasons designated

in fair value Equity as fair value
accumulated instruments measurement with
to other derecognised in Equity changes included in
comprehensive the current instruments other comprehensive
income Fair value year still held income
Listed equity investments 88,343 1,329,839 – 108,778 Non-tradable
Unlisted equity investments 608,807 4,508,545 18,983 28,385 Non-tradable
Total 697,150 5,838,384 18,983 137,163

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V. Notes to the consolidated financial statements (continued)

15. Investments in other equity instruments (continued)

2019

Changes Dividend income of the year Reasons designated

in fair value Equity as fair value
accumulated instruments measurement with
to other derecognised in Equity changes included in
comprehensive the current instruments other comprehensive
income Fair value year still held income
Listed equity investments 372,708 1,659,862 – 240,330 Non-tradable
Unlisted equity investments 1,060,066 6,409,181 – 30,320 Non-tradable
Total 1,432,774 8,069,043 – 270,650

In 2020, the Group disposed of RMB643,269 thousand of other equity instrument investment, and a total amount of
RMB310,690 thousand has been transferred from other comprehensive income to retained earnings.

16. Investment properties

Subsequent measurement under the cost model:

2020
Investment
properties
Buildings Land use rights in progress Total
Cost
  Opening balance of the year 52,236,824 13,167,211 18,862,716 84,266,751
  Increase during the year 11,525,091 3,419,310 10,537,506 25,481,907
  Decrease during the year (2,393,506) (50,297) (223,989) (2,667,792)
  Closing balance of the year 61,368,409 16,536,224 29,176,233 107,080,866
Accumulated depreciation and
 amortisation
  Opening balance of the year (6,100,476) (1,865,118) – (7,965,594)
  Increase during the year (1,889,510) (264,155) – (2,153,665)
  Decrease during the year 179,262 3,964 – 183,226
  Closing balance of the year (7,810,724) (2,125,309) – (9,936,033)
Impairment allowance
  Opening balance of the year – – – –
  Increase during the year (21,988) – – (21,988)
  Decrease during the year 835 – – 835
  Closing balance of the year (21,153) – – (21,153)
Net book value
  At the beginning of the year 53,536,532 14,410,915 29,176,233 97,123,680
  At the end of the year 46,136,348 11,302,093 18,862,716 76,301,157

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V. Notes to the consolidated financial statements (continued)

16. Investment properties (continued)

Subsequent measurement under the cost model: (continued)

2019
Investment
properties in
Buildings Land use rights progress Total
Cost
  Opening balance of the year 48,342,987 12,783,939 13,797,564 74,924,490
  Increase during the year 4,719,584 400,603 7,322,840 12,443,027
  Decrease during the year (825,747) (17,331) (2,257,688) (3,100,766)
  Closing balance of the year 52,236,824 13,167,211 18,862,716 84,266,751
Accumulated depreciation and
amortisation
  Opening balance of the year (4,742,269) (1,531,011) – (6,273,280)
  Increase during the year (1,416,406) (335,743) – (1,752,149)
  Decrease during the year 58,199 1,636 – 59,835
  Closing balance of the year (6,100,476) (1,865,118) – (7,965,594)
Impairment allowance
  Opening balance of the year (1,027) – – (1,027)
  Decrease during the year 1,027 – – 1,027
  Closing balance of the year – – – –
Net book value
  At the end of the year 46,136,348 11,302,093 18,862,716 76,301,157
  At the beginning of the year 43,599,691 11,252,928 13,797,564 68,650,183

Investment properties are leased out to third parties under operating leases.

For the year of 2020, the Group changed the use of houses and buildings with a carrying amount of RMB1,659,677
thousand (A cost of: RMB1,710,402 thousand) for self-use and transferred them into fixed assets at the date of change of
use; for the year of 2019, the Group changed the houses and buildings with a carrying amount of RMB82,667 thousand (A
cost of: RMB118,608 thousand) for self-use and transferred them into fixed assets at the date of change of use.

For the year of 2020, the Group changed the investment properties with a carrying amount of RMB25,184 thousand (A cost
of: RMB26,667 thousand) to inventory; for the year of 2019, the Group changed the investment properties with a carrying
amount of RMB1,078,525 thousand (A cost of: RMB1,080,087 thousand) to inventory.

For the year of 2020, the Group changed the inventory with a carrying amount of RMB9,047,396 thousand (A cost of:
RMB9,047,396 thousand) to lease, and transfers the inventory into investment properties at the date of change of use;
for the year of 2019, the Group changed the inventory with a carrying amount of RMB3,881,747 thousand (A cost of:
RMB3,881,747 thousand) to lease, and transferred the inventory into investment properties at the date of change of use.

For the year of 2020, the Group changed the fixed assets with a carrying amount of RMB267,317 thousand (A cost of:
RMB308,100 thousand) to lease, and transferred from fixed assets to investment properties at the date of change of use;
for the year of 2019, the Group changed the fixed assets with a carrying amount of RMB383,002 thousand (A cost of:
RMB396,160 thousand) to lease, and transferred from fixed assets to investment properties at the date of change of use.

For the year of 2020, the Group’s construction in progress project with a carrying amount of RMB580,792 thousand (A
cost of: RMB580,792 thousand) was completed and used for leasing, which was changed to investment properties; for
the year of 2019, the Group’s construction in progress project with a carrying amount of RMB891,908 thousand (A cost of:
RMB891,908 thousand) was completed and used for leasing, which was changed to investment properties.

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V. Notes to the consolidated financial statements (continued)

16. Investment properties (continued)

For the year of 2020, the Group disposed the investment real estate with book value of RMB84,622 thousand with a
disposal income of RMB168 thousand; In 2019, the Group disposed the investment real estate with a book value of
RMB863,532 thousand, with a disposal income of RMB487,669 thousand.

As at 31 December 2020 and 31 December 2019, the investment properties that were pledged by the Group to banks for
borrowings are presented in details in Note V. 66.

17. Fixed assets

2020
Office
equipment,
temporary
Machinery and Motor facilities and
Buildings equipment vehicles others Total
Cost
  Opening balance of the year 28,359,820 17,923,910 3,259,952 16,023,119 65,566,801
 Purchases 920,868 1,636,531 354,680 2,489,299 5,401,378
  Transfers from construction in progress (Note V. 18) 1,687,035 466,702 2,799 918,810 3,075,346
  Other addition 1,243,128 892,425 275,494 1,471,489 3,882,536
  Disposals or retirements (316,748) (800,162) (402,894) (1,256,555) (2,776,359)
  Other decrease (1,126,186) (2,271,824) (318,042) (1,215,736) (4,931,788)
  Closing balance of the year 30,767,917 17,847,582 3,171,989 18,430,426 70,217,914
Accumulated depreciation
  Opening balance of the year (4,878,782) (9,840,821) (2,184,862) (10,818,006) (27,722,471)
  Depreciation accrued during the year (830,444) (1,510,098) (273,854) (3,457,089) (6,071,485)
  Other additions (175,183) (644,351) (220,832) (432,869) (1,473,235)
  Disposals or retirements 82,682 631,724 326,843 1,106,330 2,147,579
  Other decrease 197,212 1,029,330 248,046 781,837 2,256,425
  Closing balance of the year (5,604,515) (10,334,216) (2,104,659) (12,819,797) (30,863,187)
Impairment allowance
  Opening balance of the year (213,151) (39,819) (28,508) (8,356) (289,834)
  Impairment accrued during the year (Note V. 24) (2,745) (5,001) (163) – (7,909)
  Other additions – (1,986) (5,394) – (7,380)
  Disposals or retirements 2,805 33,399 24,367 8,190 68,761
  Other decrease 1,215 428 6,821 131 8,595
  Closing balance of the year (211,876) (12,979) (2,877) (35) (227,767)
Net book value
  At the end of the year 24,951,526 7,500,387 1,064,453 5,610,594 39,126,960
  At the beginning of the year 23,267,887 8,043,270 1,046,582 5,196,757 37,554,496

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V. Notes to the consolidated financial statements (continued)

17. Fixed assets (continued)

2019
Office
equipment,
temporary
Machinery and Motor facilities and
Buildings equipment vehicles others Total
Cost
  Opening balance of the year 24,840,356 17,006,786 3,384,719 21,619,229 66,851,090
 Purchases 1,094,559 1,665,459 257,365 2,957,217 5,974,600
  Transfers from construction in progress (Note V. 18) 2,056,653 331,274 9,371 678,066 3,075,364
  Other addition 1,221,791 913,812 142,270 247,690 2,525,563
  Disposals or retirements (336,378) (1,052,880) (430,265) (8,134,468) (9,953,991)
  Other decrease (517,161) (940,541) (103,508) (1,344,615) (2,905,825)
  Closing balance of the year 28,359,820 17,923,910 3,259,952 16,023,119 65,566,801
Accumulated depreciation
  Opening balance of the year (4,034,613) (9,235,479) (2,176,596) (15,459,176) (30,905,864)
  Depreciation accrued during the year (849,862) (1,536,158) (327,704) (3,829,529) (6,543,253)
  Other additions (141,341) (470,190) (105,800) (225,519) (942,850)
  Disposals or retirements 97,009 903,302 367,301 7,956,268 9,323,880
  Other decrease 50,025 497,704 57,937 739,950 1,345,616
  Closing balance of the year (4,878,782) (9,840,821) (2,184,862) (10,818,006) (27,722,471)
Impairment allowance
  Opening balance of the year (211,390) (32,672) (12,687) (8,483) (265,232)
  Impairment accrued during the year (Note V. 24) (1,102) (8,289) (16,130) – (25,521)
  Other additions (1,062) – – (28) (1,090)
  Disposals or retirements 347 1,142 309 155 1,953
  Other decrease 56 – – – 56
  Closing balance of the year (213,151) (39,819) (28,508) (8,356) (289,834)
Net book value
  At the end of the year 23,267,887 8,043,270 1,046,582 5,196,757 37,554,496
  At the beginning of the year 20,594,353 7,738,635 1,195,436 6,151,570 35,679,994

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V. Notes to the consolidated financial statements (continued)

17. Fixed assets (continued)

Fixed assets held under a finance lease are as follows:

31 December 2020
Accumulated Impairment
Cost depreciation allowance Net book value
Machinery and equipment 710,394 (137,189) – 573,205
Motor vehicles 342 (96) – 246
Total 710,736 (137,285) – 573,451

31 December 2019
Accumulated Impairment
Cost depreciation allowance Net book value
Machinery and equipment 717,777 (136,910) – 580,867
Motor vehicles 46,973 (32,989) (5,371) 8,613
Total 764,750 (169,899) (5,371) 589,480

As at 31 December 2020, the fixed assets with a carrying amount of RMB159,348 thousand, and a cost of RMB247,937
thousand are leased out under operating leases (31 December 2019: a carrying amount of RMB241,269 thousand and a
cost of RMB411,214 thousand).

As at 31 December 2020 and 31 December 2019, the fixed assets that were pledged by the Group to banks for borrowings
are presented in details in Note V. 66.

18. Construction in progress

31 December 2020 31 December 2019

Carrying Impairment Net book Carrying Impairment Net book
amount allowance value amount allowance value
Construction in progress 11,184,034 (250,945) 10,933,089 10,338,334 (252,521) 10,085,813

The movements of significant projects of construction in progress are as follows:

Proportion
of
Opening Transfer to Other Closing investment
Budgeted balance of fixed assets transferred balance of to budget
amount the year Additions (Note V. 17) out the year Source of funds (%)
Beijing Advanced Business Park Office
Self-funding
Building of China Construction Third 2,152,390 1,515,607 410,646 – (3,106) 1,923,147 89
and loan
Engineering Bureau Co., Ltd.
Shanghai Zhongjian Yuelan Mountain Project 1,473,684 792,545 143,893 – – 936,438 Self-funding 64
Self-funding
CSCEC Jinxiutiandi Construction Project 1,290,670 650,106 245,862 – – 895,968 69
and loan
Songjiang Building Construction Project 1,395,072 559,191 280,630 – – 839,821 Self-funding 60
Wanning Jinxin Grand Hyatt 1,313,996 610,566 103,470 – – 714,036 Self-funding 54
Liutai Building of China Construction Sixth
632,208 420,767 205,709 – – 626,476 Self-funding 99
Engineering Division Corp. Ltd.
Songjiang Yunzhu Shenlan Construction Self-funding
383,163 344,140 25,299 – – 369,439 96
Project and loan
Zhonghai Huanyu City Construction Project 545,628 217,024 131,597 – – 348,621 Self-funding 64
Self-funding
Others N/A 5,228,388 3,506,995 (3,075,346) (1,129,949) 4,530,088 N/A
and loan
Total 10,338,334 5,054,101 (3,075,346) (1,133,055) 11,184,034

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V. Notes to the consolidated financial statements (continued)

18. Construction in progress (continued)

The movements of significant projects of construction in progress are as follows (continued):

Proportion
of
Opening Transfer to Other Closing investment
Budgeted balance of fixed assets transferred balance of to budget
amount the year Additions (Note V. 17) out the year Source of funds (%)
Beijing Advanced Business Park Office
Self-funding and
Building of China Construction Third 2,281,672 1,256,976 258,631 – – 1,515,607 66
loan
Engineering Bureau Co., Ltd.
Self-funding and
Shanghai Zhongjian Yuelan Mountain Project 1,473,684 – 792,545 – – 792,545 54
loan
CSCEC Jinxiutiandi Construction Project 1,290,670 481,106 169,000 – – 650,106 Self-funding 50
Self-funding and
Wanning Jinxin Grand Hyatt 1,313,996 610,566 – – – 610,566 46
loan
Songjiang Building Construction Project 1,395,072 401,440 157,751 – – 559,191 Self-funding 40
Liutai Building of China Construction Sixth
632,208 420,767 – – – 420,767 Self-funding 67
Engineering Division Corp. Ltd.
Songjiang Yunzhu Shenlan Construction
360,000 301,486 42,654 – – 344,140 Self-funding 96
Project
Self-funding and
Zhonghai Huanyu City Construction Project 545,628 – 217,024 – – 217,024 40
loan
Others N/A 5,071,987 5,037,651 (3,075,364) (1,805,886) 5,228,388 Self-funding N/A
Total 8,544,328 6,675,256 (3,075,364) (1,805,886) 10,338,334

The movements of significant projects of construction in progress are as follows:

2020
Accumulated Including:
amount of Interest Capitalisation
interest capitalised rate during the
Progress capitalised during the year year (%)
Beijing Advanced Business Park Office Building of
China Construction Third Engineering Bureau 89% 187,417 63,556 5.78
Co., Ltd.
CSCEC Jinxiutiandi Construction Project 69% 115,270 43,455 4.50
Songjiang Building Construction Project 96% 6,303 2,718 4.75
Others N/A 59,383 29,282 N/A
Total 368,373 139,011

2019
Accumulated Including:
amount of Interest Capitalisation
interest capitalised rate during the
Progress capitalised during the year year (%)
Beijing Advanced Business Park Office Building of
China Construction Third Engineering Bureau 66% 123,861 61,533 5.78
Co., Ltd.
CSCEC Jinxiutiandi Construction Project 50% 71,815 71,815 4.50
Songjiang Building Construction Project 96% 3,585 3,585 4.75
Others N/A 30,101 25,042 N/A
Total 229,362 161,975

As at 31 December 2020 and 31 December 2019, the construction in progress that were pledged by the Group to banks
for borrowings are presented in details in Note V. 66.

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V. Notes to the consolidated financial statements (continued)

18. Construction in progress (continued)

Impairment allowance of construction in progress:

2020
Opening balance Increase during Decrease during Increase during
of the year the year the year the year Reason
The book value is higher
252,521 – (1,576) 250,945 than the recoverable
amount

2019
Opening balance Increase during Decrease during Increase during
of the year the year the year the year Reason
The book value is higher
250,945 1,576 – 252,521 than the recoverable
amount

19. Intangible assets

2020
Land use Franchise
rights rights Software Others Total
Cost
  Opening balance of the year 7,451,478 12,806,517 726,921 694,476 21,679,392
  Increase during the year 372,766 6,411,903 183,483 12,311 6,980,463
  Decrease during the year (87,235) – (20,417) (1,434) (109,086)
  Closing balance of the year 7,737,009 19,218,420 889,987 705,353 28,550,769
Accumulated amortisation
  Opening balance of the year (1,024,490) (1,237,277) (399,338) (322,234) (2,983,339)
  Increase during the year (149,236) (202,940) (101,485) (25,447) (479,108)
  Decrease during the year 26,922 – 14,212 1,100 42,234
  Closing balance of the year (1,146,804) (1,440,217) (486,611) (346,581) (3,420,213)
Impairment allowance
  Opening balance of the year (1,334,236) (952,660) – – (2,286,896)
  Decrease during the year (284,663) – – – (284,663)
  Closing balance of the year (1,618,899) (952,660) – – (2,571,559)
Net book value
  Closing balance of the year 4,971,306 16,825,543 403,376 358,772 22,558,997
  Opening balance of the year 5,092,752 10,616,580 327,583 372,242 16,409,157

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V. Notes to the consolidated financial statements (continued)

19. Intangible assets (continued)

2019
Land use Franchise
rights rights Software Others Total
Cost
  Opening balance of the year 7,673,025 7,483,146 647,651 831,869 16,635,691
  Increase during the year 512,994 5,636,192 149,226 38,973 6,337,385
  Decrease during the year (734,541) (312,821) (69,956) (176,366) (1,293,684)
  Closing balance of the year 7,451,478 12,806,517 726,921 694,476 21,679,392
Accumulated amortisation
  Opening balance of the year (942,689) (1,091,763) (364,861) (445,000) (2,844,313)
  Increase during the year (175,516) (145,514) (96,757) (47,275) (465,062)
  Decrease during the year 93,715 – 62,280 170,041 326,036
  Closing balance of the year (1,024,490) (1,237,277) (399,338) (322,234) (2,983,339)
Impairment allowance
  Closing balance of the year (1,334,236) (862,947) – – (2,197,183)
  Decrease during the year – (89,713) – – (89,713)
  Closing balance of the year (1,334,236) (952,660) – – (2,286,896)
Net book value
  Closing balance of the year 5,092,752 10,616,580 327,583 372,242 16,409,157
  Opening balance of the year 5,396,100 5,528,436 282,790 386,869 11,594,195

As at 31 December 2020 and 31 December 2019, the intangible assets that were pledged by the Group to banks for
borrowings are presented in details in Note V. 66.

20. Goodwill

2020
Other
Opening balance Increase during movements Closing balance
The invested entity of the year the year (Note1) of the year
China Overseas Land & Investment Ltd. (“China Overseas
1,498,889 – (69,440) 1,429,449
Land & Investment”)
China State Construction Development Holdings Limited
511,232 – (23,684) 487,548
(“State Construction Development”)
Plaza Construction LLP 105,551 – (6,829) 98,722
Finqnciere Groupe Betom – 59,210 (807) 58,403
China Construction Sixth Engineering Division Water Conservancy
42,797 – – 42,797
and Hydropower Construction Group
CSCEC Zhong Huan Engineering Co., Ltd. 40,103 – – 40,103
Yueyang Hecheng Construction Investment 27,027 – – 27,027
China State Construction Built Port Group 15,583 – – 15,583
Jimsar County Tianyu Huaxin Cement Development Co., Ltd. 14,601 – – 14,601
Hubei Civil Air Defense Construction Design Institute 11,563 – – 11,563
Chongqing Zhonghai Investment Co., Ltd 11,167 – (517) 10,650
Yunnan Long Hydropower Base 11,163 – – 11,163
Liaoning Road & Bridge Construction Group 10,562 – – 10,562
Dezhou Haoyu Investment Co., Ltd. 13,142 – – 13,142
Others 73,121 515 (7) 73,629
Sub-Total 2,386,501 59,725 (101,284) 2,344,942
Less: Impairment allowance 39,073 54,681
Total 2,347,428 2,290,261

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V. Notes to the consolidated financial statements (continued)

20. Goodwill (continued)

2019
Other
Opening balance Increase during movements Closing balance
The invested entity of the year the year (Note1) of the year
China Overseas Land & Investment 1,480,259 – 18,630 1,498,889
China State Construction Development Holdings Limited 504,878 – 6,354 511,232
Plaza Construction LLP 103,841 – 1,710 105,551
China Construction Sixth Engineering Division Water Conservancy
– 42,797 – 42,797
and Hydropower Construction Group
CSCEC Zhong Huan Engineering Co., Ltd. 40,103 – – 40,103
Yueyang Hecheng Construction Investment 27,027 – – 27,027
China State Construction Built Port Group 15,583 – – 15,583
Jimsar County Tianyu Huaxin Cement Development Co., Ltd 14,601 – – 14,601
Dezhou Haoyu Investment Co., Ltd. 13,142 – – 13,142
Hubei Civil Air Defense Construction Design Institute 11,563 – – 11,563
Chongqing Zhonghai Investment Co., Ltd. 11,028 – 139 11,167
Yunnan Long Hydropower Base 11,163 – – 11,163
Liaoning Road & Bridge Construction Group 10,562 – – 10,562
Others 88,240 – (15,119) 73,121
Subtotal 2,331,990 42,797 11,714 2,386,501
Less: Impairment allowance 38,932 39,073
Total 2,293,058 2,347,428

Changes in impairment allowance of goodwill are as below:

2020
Other
Opening balance Accrued movements Closing balance
of the year this year (Note1) of the year
Jimsar County Tianyu Huaxin Cement Development
14,601 – – 14,601
Co., Ltd
Dezhou Haoyu Investment Co., Ltd. 13,142 – – 13,142
Chongqing Zhonghai Investment Co., Ltd. 11,167 – (517) 10,650
CSCEC Zhong Huan Engineering Co., Ltd. – 12,031 – 12,031
Others 163 4,101 (7) 4,257
Total 39,073 16,132 (524) 54,681

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V. Notes to the consolidated financial statements (continued)

20. Goodwill (continued)

Changes in impairment allowance of goodwill are as below: (continued)

2019

Opening Other Closing

balance movements balance
of the year (Note1) of the year
Jimsar County Tianyu Huaxin Cement Development Co., Ltd. 14,601 – 14,601
Dezhou Haoyu Investment Co., Ltd. 13,142 – 13,142
Chongqing Zhonghai Investment Co., Ltd. 11,028 139 11,167
Others 161 2 163
Total 38,932 141 39,073

Note1: Other movements are mainly due to changes in exchange rates.

The measurement basis and main assumptions for the recoverable amounts of the above asset groups are as follows:

The recoverable amount of an asset group is the higher of its fair value less costs to sell and the present value of the future
cash flows estimated to be derived from the asset or the asset group.

For the asset group or portfolio of China Overseas Land & Investment and China State Construction Development, the
present value of the future cash flows of the asset group were higher than the book value, and there was no impairment of
the relevant goodwill.

21. Long-term prepaid expenses

2020

Opening Closing
balance Other balance
of the year Increase Amortisation decrease of the year
Expenditure on improvement of
417,141 149,747 (117,334) (4,954) 444,600
leased fixed assets
Office rent 66,650 129,265 (40,062) (1,651) 154,202
Others 452,009 200,343 (139,904) (12,541) 499,907
Total 935,800 479,355 (297,300) (19,146) 1,098,709

2019

Opening Closing
balance Other balance
of the year Increase Amortisation decrease of the year
Expenditure on improvement of
leased fixed assets 385,186 221,092 (177,359) (11,778) 417,141
Office rent 68,963 21,754 (21,728) (2,339) 66,650
Others 282,043 317,240 (139,123) (8,151) 452,009
Total 736,192 560,086 (338,210) (22,268) 935,800

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V. Notes to the consolidated financial statements (continued)

22. Deferred tax assets/liabilities

Deferred tax assets and liabilities without taking into consideration the offsetting of balances:
31 December 2020 31 December 2019
Deductible Deductible
temporary temporary
differences Deferred differences Deferred
and losses tax assets and losses tax assets
Deferred tax assets
  Impairment allowance of assets 30,577,354 5,588,024 29,216,494 5,564,218
  Elimination of intra group unrealised profit 4,075,148 937,061 4,803,177 1,128,760
  Accrued expenses 27,335,649 6,690,580 23,630,682 5,790,401
  Accrued liabilities 2,968,722 503,219 1,955,638 370,269
  Deductible losses 15,192,233 3,333,024 14,930,826 3,746,808
  Discounted long-term receivables 145,351 24,251 294,490 64,635
 Others 1,745,180 417,610 843,397 189,379
Total 82,039,637 17,493,769 75,674,704 16,854,470

31 December 2020 31 December 2019

Taxable Taxable
temporary Deferred temporary Deferred
differences tax liabilities differences tax liabilities
Deferred tax liabilities
  Depreciation of fixed assets 364,073 74,825 381,667 86,633
  Fair value adjustment of business
   combinations involving enterprises 14,864,768 3,445,441 11,861,961 3,025,403
   not under common control
  Changes in fair value of financial assets 621,625 170,550 1,915,474 403,898
  Gain from special restructuring of
1,179,437 294,859 1,179,437 294,859
   subsidiaries (Note 1)
  Withholding tax for dividends (Note 2) 4,226,760 211,338 3,530,376 176,519
  Revenue from BT/BOT projects 7,108,179 1,777,045 4,224,940 1,056,235
  Others 5,649,216 1,326,419 5,331,995 1,337,505
Total 34,014,058 7,300,477 28,425,850 6,381,052

Note 1: According to Notice of the Ministry of Finance and the State Administration of Taxation on Enterprise Income Tax
Treatment of Enterprise Reorganization (Cai Shui [2009] No. 59), deferred tax liabilities are recognised by the Company
and other related subsidiaries for the difference between tax base and accounting base of equity investment arising from
reorganization of West Construction.
Note 2: According to the arrangement between Mainland China and Hong Kong Special Administrative Region over
income taxes to avoid double taxation and tax evasion, signed between Mainland China and Hong Kong, withholding tax
for dividends are provided by domestic subsidiaries, domestic associates and domestic joint ventures of the subsidiaries of
China Overseas Land & Investment and China State Construction International Holdings Limited (“China State Construction
International”) for profit estimated to be distributed to the subsidiaries of China Overseas Land & Investment and China
State Construction International at the tax rate of 5%.

Deferred tax assets and deferred tax liabilities that are presented at the net amount after offsetting:
31 December 2020 31 December 2019
Offsetting Net amount Offsetting Net amount
amount after offsetting amount after offsetting
Deferred tax assets 1,244,327 16,249,442 1,725,342 15,129,128
Deferred tax liabilities 1,244,327 6,056,150 1,725,342 4,655,710

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V. Notes to the consolidated financial statements (continued)

22. Deferred tax assets/liabilities (continued)

Deductible temporary differences and deductible tax losses for which deferred tax assets are not recognised are listed as
follows:
31 December 2020 31 December 2019
Deductible temporary differences 22,128,260 16,104,017
Deductible tax losses 17,403,113 19,046,329
Total 39,531,373 35,150,346

Deductible tax losses that are not recognised as deferred tax assets will expire in the following years:
31 December 2020 31 December 2019
2020 – 1,137,200
2021 1,703,333 2,000,451
2022 1,528,760 2,715,585
2023 2,454,912 5,508,849
2024 4,861,870 7,684,244
2025 6,854,238 –
Total 17,403,113 19,046,329

23. Other non-current assets

31 December 2020 31 December 2019

Contract assets (Note V. 9) 139,278,678 146,917,573
Input VAT to be verified 859,779 1,103,821
Prepayment of purchase of long-term assets 499,457 860,820
Others 820,763 1,061,994
Sub-total 141,458,677 149,944,208
Less: Impairment allowance (1,512,744) (1,995,266)
Total 139,945,933 147,948,942

As at 31 December 2020, the impairment allowance of the above contract assets is RMB1,512,738 thousand (31
December 2019: RMB1,987,046 thousand).

24. Impairment allowance of assets

2020
Decrease
during the year
Opening Closing
balance Provision Transfer/ Other balance
of the year for the year Reversal Write-off movement of the year
Impairment allowance of accounts receivable 23,804,177 15,060,518 (12,166,489) (902,942) (5,264) 25,790,000
Impairment allowance of other receivables 7,081,322 2,170,366 (1,841,012) (609,160) (42,063) 6,759,453
Impairment allowance of other current assets 1,483,067 88,981 – – (40,779) 1,531,269
Impairment allowance of current portion of
846,270 1,097,130 (146,869) (565) 145,047 1,941,013
non-current assets
Impairment allowance of other non-current assets 1,995,266 311,506 (720,788) (28,920) (44,320) 1,512,744
Other ECLs provisions 637,280 15,602 (651,221) (461) – 1,200
Impairment allowance of debt investments 40,282 4,213 (29,359) – 92 15,228
Impairment allowance of long-term receivables 916,396 725,467 (144,689) (1,500) (69,974) 1,425,700

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V. Notes to the consolidated financial statements (continued)

24. Impairment allowance of assets (continued)

2020 (continued)

Decrease
during the year
Opening Closing
balance Provision Transfer/ Other balance
of the year for the year Reversal Write-off movement of the year
Impairment allowance of contract assets 2,980,333 327,307 (943,678) – (36,992) 2,326,970
Impairment provision for write-down of inventories 4,200,108 570,238 (386,765) (147,146) (63,786) 4,172,649
Impairment allowance of long-term equity
294,056 – – – – 294,056
investments
Impairment allowance of fixed assets 289,834 7,909 – (68,761) (1,215) 227,767
Impairment allowance of construction in progress 252,521 – – (1,576) – 250,945
Impairment allowance of investment properties – 20,844 – (835) 1,144 21,153
Impairment allowance of intangible assets 2,286,896 284,663 – – – 2,571,559
Impairment allowance of goodwill 39,073 16,132 – – (524) 54,681
Total 47,146,881 20,700,876 (17,030,870) (1,761,866) (158,634) 48,896,387

2019
Decrease
during the year
Closing
balance at Changes in Opening Closing
the end of accounting balance of Provision for Transfer/ Other balance of
the year policies the year the year Reversal Write-off movement the year
Impairment allowance of accounts receivable 20,453,337 3,323,905 23,777,242 5,010,216 (4,340,373) (714,592) 71,684 23,804,177
Impairment allowance of other receivables 6,399,767 417,929 6,817,696 1,305,421 (891,574) (135,135) (15,086) 7,081,322
Impairment allowance of other current assets 91,449 1,202,896 1,294,345 179,293 (31,536) (4,251) 45,216 1,483,067
Impairment allowance of current portion of
514,553 107,820 622,373 273,186 (63,636) (61) 14,408 846,270
non-current assets
Impairment allowance of other non-current
27,036 1,654,594 1,681,630 581,971 (299,003) (1,461) 32,129 1,995,266
assets
Other ECLs provisions 1,200 – 1,200 636,080 – – – 637,280
Impairment allowance of debt investments – 25,314 25,314 21,777 (6,206) – (603) 40,282
Impairment allowance of long-term receivables 982,470 (274,370) 708,100 216,193 (37,285) – 29,388 916,396
Impairment allowance of available-for-sale
1,093,925 (1,093,925) – – – – – –
financial assets
Impairment allowance of contract assets – 2,042,926 2,042,926 1,407,818 (350,747) – (119,664) 2,980,333
Impairment provision for write-down of
6,953,220 (1,588,924) 5,364,296 1,081,150 (1,271,330) (986,003) 11,995 4,200,108
inventories
Impairment allowance of long-term equity
294,056 – 294,056 – – – – 294,056
investment
Impairment allowance of fixed assets 265,232 – 265,232 25,521 – (1,953) 1,034 289,834
Impairment allowance of construction in
250,945 – 250,945 1,576 – – – 252,521
progress
Impairment allowance of investment properties 1,027 – 1,027 – – – (1,027) –
Impairment allowance of intangible assets 2,197,183 – 2,197,183 89,713 – – – 2,286,896
Impairment allowance of goodwill 38,932 – 38,932 – – – 141 39,073
Total 39,564,332 5,818,165 45,382,497 10,829,915 (7,291,690) (1,843,456) 69,615 47,146,881

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V. Notes to the consolidated financial statements (continued)

25. Short-term borrowings

31 December 2020 31 December 2019

Unsecured borrowings 24,576,438 26,133,385
Guaranteed borrowings 2,333,204 1,473,261
Pledged borrowings 2,278,532 889,184
Mortgaged borrowings 128,922 2,501
Total 29,317,096 28,498,331

The annual interest rate for the above borrowings varied from 0.30% to 10.00% (31 December 2019: 0.25% to 10.00%).

As at 31 December 2020, the Group had a short-term loan principal of RMB21,455 thousand pledged by the letter of credit
(31 December 2019: RMB113,232 thousand).

As at 31 December 2020 and 31 December 2019, the Group has mortgaged or pledged various assets to banks as
security for borrowings that are presented in details in Note V.66.

26. Notes payable

31 December 2020 31 December 2019

Commercial acceptance bills 523,567 1,198,862
Bank acceptance bills 4,742,025 5,831,552
Total 5,265,592 7,030,414

27. Accounts payable

31 December 2020 31 December 2019

Payables for projects and for real estate development 255,909,264 260,159,968
Payables for purchase of materials 167,173,727 164,239,660
Payables for services 56,022,419 50,639,870
Rent payable 15,554,843 13,205,291
Others 7,726,712 4,884,841
Total 502,386,965 493,129,630

As at 31 December 2020, accounts payable over 1 year with a carrying amount of RMB135,390,290 thousand
(31 December 2019: RMB104,131,676 thousand) are mainly payables for projects, which are unsettled as the projects
have not been completed or settled.

28. Advances from customers

31 December 2020 31 December 2019

Others 607,427 449,953

As at 31 December 2020, advances from customers over 1 year with a carrying amount of RMB10,766 thousand
(31 December 2019: RMB4,873 thousand) are mainly for advance rent receipts.

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V. Notes to the consolidated financial statements (continued)

29. Contract liabilities

31 December 2020 31 December 2019

Amount due to customers for contract work 68,341,670 61,909,554
Advances for projects 47,925,275 44,520,387
Advances for sale of properties 188,243,091 171,677,198
Others 4,969,016 3,682,445
Total 309,479,052 281,789,584

At the balance sheet date, the details of advances for sale of properties are as follows:
Estimated
completion/ Pre-sale
31 December 31 December completion percentage
Project name 2020 2019 date (Note) (%) (Note)
Beixinan Shanty Town Repair Housing Placement Project 8,257,204 11,131,176 August 2022 98
Beijing Shougangyuan Project 5,969,360 1,671,290 June 2021 100
Shenzhen Zhonghai Huideli Project 5,776,902 – June 2022 93
Zhonghai Huanyu Ara Project 4,593,965 – September 2022 74
Shanghai Hongqi Village Project 4,159,187 1,516,235 December 2022 64
Zhongjian Xingguangcheng Ground KT1 3,532,473 1,408,675 June 2023 100
Shanghai Jianguoli Phase II-Estate 3,290,270 – November 2021 100
Changsha Wenjinmingyuan Phase II-Estate 3,155,384 138,467 December 2021 100
Tianjin City Square Phase III 3,056,093 819,384 December 2025 36
Chongqing International Community Shilichangjiang 3,054,813 – September 2021 49
Wuhan Zhongjian Bo Mansion 2,896,925 1,287,340 December 2024 80
Beijing Lichun Lake project 2,868,644 921,155 December 2021 61
Hangzhou Zhonghai Cuiyuan Project 2,762,362 515,917 December 2020 84
Shenyang Hepingzhimen Phase III 2,726,108 410,948 June 2021 96
Changsha Zhongjian Jinghecheng Project 2,713,003 1,402,213 June 2022 87
Xiamen Zhonghai Xinglinluwan Project 2,578,051 – June 2021 69
Wuxi Zhonghai Huanyutianxia 2,329,346 294,942 December 2020 89
Dalian Zhonghai Yunlu Mansion 2,294,927 379,078 June 2021 84
Suzhou Gangtian Road Project 2,284,234 – June 2021 100
Shared property house,The 19th block of Houshayu Town,
2,267,599 504,880 December 2021 100
Shunyi District, Beijing
Beijing Yinghai Project Phase II&III 2,221,414 76,087 December 2021 61
Shanghai Zhongjian Langyue Project 2,213,995 231,923 March 2021 80
Changzhou Xihuayayuan 2,164,500 1,601,165 December 2022 73
Taiyuan CSCEC International Community No.1 1,877,884 1,397,187 June 2021 95
Zhengzhou Zhonghai Hubinshijia South Area 1,780,283 1,096,970 December 2021 100
Zhonghai No.9 Mansion 1,771,446 1,716,347 June 2021 97
Wuhan Zhongjian Fudixincheng 1,736,522 1,040,356 March 2022 85
Areas B and C of China Construction Jinxiu Tiandi 1,712,641 836,002 June 2021 90
Chongqing Zhongjian Yuhu No.1 1,699,115 – December 2025 70

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V. Notes to the consolidated financial statements (continued)

29. Contract liabilities (continued)

At the balance sheet date, the details of advances for sale of properties are as follows: (continued)

Estimated
completion/ Pre-sale
31 December 31 December completion percentage
Project name 2020 2019 date (Note) (%) (Note)
Zhongxin Jinxiutiandi Ground C-0203 1,685,236 1,160,314 June 2022 60
Hangzhou Xiangqifang Project 1,648,176 477,695 July 2020 100
Wuhan Zhonghailianhua Lake Project 1,613,937 229,966 September 2021 75
Sudi Ground WG-25# 1,571,953 957,528 September 2021 88
Jinan CSCEC International Community 1,532,945 49,491 October 2022 78
Shanghai Huideli Project 1,499,905 – April 2021 100
Chengdu Zhonghai Yunlushijia 1,496,224 1,008,208 June 2021 81
Huinan Minle Project, Pudong, Shanghai 1,343,987 4,908,009 June 2021 80
Wuhan CSCEC Jinxiu cultural city phase I 1,325,259 1,239,725 June 2021 99
Dongguan Zhonghai Huating 1,308,108 – June 2021 100
Guangxi Zhongjian Yonghefu Project 1,294,712 228,573 June 2023 40
Taihu Town Project in Tongzhou District, Beijing 1,238,326 266,265 August 2021 99
Harbin Zhonghaiheyuan 1,231,887 771,747 December 2020 94
Suzhou Yundong Project 1,226,871 – August 2022 44
Guangzhou Haizhu Daganwei Plot Project 1,224,600 – June 2022 39
Changchun Zhonghai Longxi B 1,205,463 1,004,612 June 2021 100
Shijiazhuang Zhonghai Yunjin Project 1,172,366 – June 2022 51
Dalian Park Uptown Project 1,159,874 14,113 December 2021 48
Zhuzhou Zhongjian Yuexitai Project 1,141,084 705,375 December 2021 50
Yunnan Kunming Three Gorges Building and Wu’ai Community 1,407,007 3,117,569 June 2021 95
Chongqing Zhongjian Yuhecheng (Phase I) 1,063,270 840,857 May 2021 74
Jinan Zhangma Xindong Station Land #A4 1,060,221 – September 2022 76
Wuhan Zhongjian Xingguangcheng Ground KT2 1,057,796 – June 2023 100
Changsha CSCEC Jiangshan No. 1 1,008,777 1,194,876 June 2021 93
Tianjin Qianjiangyuan Project 1,005,836 438,461 October 2022 14
Jinan Zhonghai Huashanlongcheng Project 856,019 4,049,648 July 2022 100
Jinan Zhongjian Changqinghu 832,666 2,349,189 June 2022 99
Chongqing Zhongjian Yuhecheng Project 799,009 1,419,511 June 2022 88
Chongqing CSCEC Hushan impression 685,070 1,045,572 November 2021 98
Changsha CSCEC Yuehe Town 585,054 1,371,160 June 2021 100
Changde Zhongjian Binjiangfu 446,723 1,086,506 June 2022 100
Dalian Zhongxin Haigangcheng Phase II 393,031 1,439,457 December 2023 100
Shenyang Hepingzhimen Ground 5# (Phase I) 324,609 2,348,071 October 2021 94
Shenyang Banshanhuafu Project 285,685 1,736,704 December 2020 100

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V. Notes to the consolidated financial statements (continued)

29. Contract liabilities (continued)

At the balance sheet date, the details of advances for sale of properties are as follows: (continued)

Estimated
completion/ Pre-sale
31 December 31 December completion percentage
Project name 2020 2019 date (Note) (%) (Note)
Tsingtao Jiaodong International Airport Project Ground B 190,252 1,740,925 December 2022 100
Project TianZuan 184,544 6,642,900 December 2021 90
Zunyi Zhongjian Xingfucheng Phase II-Estate 177,633 2,097,708 June 2020 88
Nanjing Chengnangongguan Project 138,141 1,404,738 April 2020 90
Chengdu Tianfu CSCEC Mansion No.1 127,412 1,416,260 December 2024 85
Beijing Zhonghai Yunzhu 90,070 1,673,595 June 2020 47
Zhuhai Huanyucheng 84,920 1,488,339 June 2020 100
Wuhan Zhongjian Big Mansion 70,102 2,367,664 October 2025 95
Tianjin Lanhewan 69,170 1,560,207 December 2020 98
Wuhan Zhongjian Royal Star City 64,386 1,994,948 December 2020 94
CSCEC Yichang Star Land #C 40,574 1,101,492 June 2021 92
Wuhan Zhongjian Yipinlanjun Project 33,482 1,129,390 December 2020 100
Shenyang Hepingzhimen Ground 1#,Phase 1, Zone 2.2 24,494 1,143,518 October 2021 100
Kunming Lanting Project 18,899 1,414,772 December 2020 90
Beijing Zhonghai Yunxi Project 13,486 1,962,051 January 2021 87
Zhengzhou No. 7 Institute of China Construction 10,141 1,084,058 December 2020 91
Nanjing Zuoan Lanting 2,119 6,395,516 December 2020 100
Xi’an Zhonghai Chang’an Avenue – 2,195,575 May 2021 94
Dalian Zhonghai Wanjin Mansion – 1,711,132 December 2020 97
Shanghai Pudong New District Caolu Town District-level Affordable Housing
– 1,092,664 September 2020 100
Project Phase I
Others 61,426,930 64,202,807
Total 188,243,091 171,677,198

Note: Most of the above projects are phased development projects. The estimated completion time is the last phase
of completion, and the pre-sale ratio is the proportion of the contracted area of the housing area that meets the sales
conditions at the end of each year.

30. Employee benefits payable

2020
Opening Increase Decrease Closing
balance of during during balance of
the year the year the year the year
Short-term employee benefits payable 7,474,848 75,080,672 (74,593,355) 7,962,165
Defined contribution plans payable
259,374 4,189,747 (4,230,346) 218,775
  (Defined contribution plans)
Termination benefits payable (Note V. 38) 23,640 11,511 (15,531) 19,620
Total 7,757,862 79,281,930 (78,839,232) 8,200,560

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V. Notes to the consolidated financial statements (continued)

30. Employee benefits payable (continued)

2019
Opening Increase Decrease Closing
balance of during during balance of
the year the year the year the year
Short-term employee benefits payable 8,158,253 67,587,891 (68,271,296) 7,474,848
Defined contribution plans payable
236,244 5,707,068 (5,683,938) 259,374
  (Defined contribution plans)
Termination benefits payable (Note V. 38) 27,167 22,123 (25,650) 23,640
Total 8,421,664 73,317,082 (73,980,884) 7,757,862

Short-term employee benefits payable are as follows:

2020
Opening Increase Decrease Closing
balance of during during balance of
the year the year the year the year
Salaries, bonuses, allowances and subsidies 6,192,039 60,825,365 (60,494,352) 6,523,052
Staff welfare 19,766 5,388,159 (5,389,747) 18,178
Social security 122,542 2,556,747 (2,584,591) 94,698
  Including: Medical insurance 105,044 2,310,229 (2,335,747) 79,526
      Work injury insurance 8,261 125,821 (124,144) 9,938
      Maternity insurance 9,237 120,697 (124,700) 5,234
Supplementary commercial insurance 9,336 147,359 (155,682) 1,013
Housing funds 109,601 3,838,600 (3,841,315) 106,886
Union running costs and employee education costs 1,000,494 1,725,485 (1,600,897) 1,125,082
Other short-term benefits 21,070 598,957 (526,771) 93,256
Total 7,474,848 75,080,672 (74,593,355) 7,962,165

2019
Opening Increase Decrease Closing
balance of during during balance of
the year the year the year the year
Salaries, bonuses, allowances and subsidies 7,039,856 54,860,189 (55,708,006) 6,192,039
Staff welfare 76,151 4,392,885 (4,449,270) 19,766
Social security 87,866 2,703,451 (2,668,775) 122,542
  Including: Medical insurance 73,826 2,321,832 (2,290,614) 105,044
      Work injury insurance 6,866 192,765 (191,370) 8,261
      Maternity insurance 7,174 188,854 (186,791) 9,237
Supplementary commercial insurance 2,766 112,850 (106,280) 9,336
Housing funds 106,036 3,519,418 (3,515,853) 109,601
Union running costs and employee education costs 829,263 1,707,891 (1,536,660) 1,000,494
Other short-term benefits 16,315 291,207 (286,452) 21,070
Total 8,158,253 67,587,891 (68,271,296) 7,474,848

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V. Notes to the consolidated financial statements (continued)

30. Employee benefits payable (continued)

Defined contribution plans payable are as follows:

2020
Opening Increase Decrease Closing
balance of during during balance of
the year the year the year the year
Basic pension insurance 181,653 3,150,687 (3,159,512) 172,828
Contribution to annuity 59,880 934,377 (957,285) 36,972
Unemployment insurance 17,841 104,683 (113,549) 8,975
Total 259,374 4,189,747 (4,230,346) 218,775

2019
Opening Increase Decrease Closing
balance of during during balance of
the year the year the year the year
Basic pension insurance 169,913 4,769,231 (4,757,491) 181,653
Contribution to annuity 47,510 752,711 (740,341) 59,880
Unemployment insurance 18,821 185,126 (186,106) 17,841
Total 236,244 5,707,068 (5,683,938) 259,374

31. Taxes and surcharges payable

31 December 2020 31 December 2019

Land appreciation tax 31,639,156 27,237,277
Corporate income tax 22,138,259 22,997,448
Value-added tax 8,122,847 6,868,032
Individual income tax 1,022,897 930,983
Urban maintenance and construction tax 411,697 441,029
Educational surcharge 227,765 273,415
Business tax 41,768 234,944
Others 422,484 385,813
Total 64,026,873 59,368,941

32. Other payables

31 December 2020 31 December 2019

Dividends payable 782,432 1,155,457
Other payables 117,490,810 112,875,184
Total 118,273,242 114,030,641

Dividends payable
31 December 2020 31 December 2019
Dividends payable to non-controlling interests 462,132 285,457
Preference shares/perpetual bond dividends payable 320,300 870,000
Total 782,432 1,155,457

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V. Notes to the consolidated financial statements (continued)

32. Other payables (continued)

Other payables
31 December 2020 31 December 2019
Guarantees payable 29,220,877 33,180,212
Project financing payables 36,530,879 25,061,553
Deposits payable 6,296,231 7,368,956
Payables for advances and construction incentives 19,590,381 18,411,755
Payments due to restricted stock incentive object 4,206,903 2,503,978
Others 21,645,539 26,348,730
Total 117,490,810 112,875,184

As at 31 December 2020, other payables over 1 year with a carrying amount of RMB35,120,396 thousand (31 December
2019: RMB26,353,176 thousand) are mainly guarantees payable and project financing payables, which were unsettled
due to the incompleteness of projects.

33. Current portion of non-current liabilities

31 December 2020 31 December 2019

Current portion of long-term borrowings (Note V. 35) 46,275,177 41,595,291
Current portion of long-term payables (Note V. 37) 11,314,629 13,936,249
Current portion of bonds payable (Note V. 36) 30,106,372 26,479,014
Exchangeable bonds in 2016 (Note V. 41) – 6,939,864
Others 450,107 67,076
Total 88,146,285 89,017,494

34. Other current liabilities

31 December 2020 31 December 2019

VAT output to be transferred 65,945,114 62,290,430
Absorption deposits (Note X. 5) 2,313,213 975,956
Estimated contract losses 1,362,324 957,504
Others 691,004 430,937
Total 70,311,655 64,654,827

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V. Notes to the consolidated financial statements (continued)

35. Long-term borrowings

31 December 2020 31 December 2019

Unsecured borrowings 222,827,945 199,982,715
Guaranteed borrowings 9,401,699 10,502,014
Pledged borrowings 85,201,557 63,477,819
Mortgage borrowings 21,741,014 15,433,171
Subtotal 339,172,215 289,395,719
Less: Long-term borrowings due within 1 year (Note V. 33)
  Including: Unsecured borrowings (37,015,423) (37,063,833)
      Guaranteed borrowings (1,936,446) (1,627,325)
      Pledged borrowings (5,798,189) (1,687,419)
      Mortgage borrowings (1,525,119) (1,216,714)
Total 292,897,038 247,800,428

As at 31 December 2020, the annual interest rate of long-term borrowings (including current portion of long-term
borrowings) varied from 1.23% to 7.00% (31 December 2019: 1.20% to 9.50%).

As at 31 December 2020, the Group had RMB15,153,181 thousand long-term loan principal pledged by future income
rights and the project franchise (31 December 2019: RMB5,426,333 thousand).

At 31 December 2020 and 31 December 2019, the Group has mortgaged or pledged various assets to banks as security
for borrowings that are presented in detail in Note V. 66.

36. Bonds payable

31 December 2020 31 December 2019

Corporate bonds 33,821,517 34,007,172
Non-public targeted bond financing instruments 82,777,698 89,865,595
Others 2,289,628 2,202,845
Subtotal 118,888,843 126,075,612
Less: Bonds payable due within 1 year (Note V. 33) (30,106,372) (26,479,014)
Total 88,782,471 99,596,598

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 V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

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As at 31 December 2020,the amount of bonds payable is as follows:
Opening Issuance Par Closing
balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
No. 4503 guaranteed note of Hong Kong in 2010 USD1 billion 10-Nov-10 10 years USD1 billion 6,907,323 – 324,027 6,593 (7,295,346) 57,403 –
Guaranteed note in 2012 HKD1.5 billion 28-Jun-12 10 years HKD1.5 billion 1,326,631 – 40,924 1,532 (1,376,578) 7,491 –
No. 4579 guaranteed note of Hong Kong in 2012 USD700 million 15-Nov-12 10 years USD700 million 4,807,969 – 71,750 6,117 (88,008) (221,898) 4,575,930
No. 4580 guaranteed note of Hong Kong in 2012 USD300 million 15-Nov-12 30 years USD300 million 2,023,007 – 227,042 431 (213,552) (93,070) 1,943,858
USD100,000 thousand privately raised bonds off Agricultural Bank of China Hong Kong
USD100 million 20-Aug-13 7 years USD100 million 696,114 – 18,122 289 (722,450) 7,925 –
Branch in 2013
B-level guaranteed note of Hong Kong in 2013 USD500 million 29-Oct-13 10 years USD500 million 3,450,404 – 255,327 3,297 (245,831) (158,484) 3,304,713
C-level guaranteed note of Hong Kong in 2013 USD500 million 29-Oct-13 30 years USD500 million 3,439,700 – 148,210 574 (162,775) (157,561) 3,268,148
No. 5746 guaranteed note of Hong Kong in 2014 USD700 million 8-May-14 10 years USD700 million 4,841,034 – 284,456 (1,492) (286,898) (222,724) 4,614,376
No. 6013 guaranteed note of Hong Kong in 2014 USD500 million 11-Jun-14 20 years USD500 million 3,410,370 – 223,168 1,346 (224,672) (156,924) 3,253,288
First medium-term note in 2015 RMB3 billion 24-Apr-15 5 years RMB3 billion 3,094,748 – 44,716 35 (3,139,499) – –
First medium-term note of China Construction Seventh Engineering Division Corp. Ltd. in
RMB100 million 24-Apr-15 5 years RMB100 million 103,718 – 1,757 6 (105,481) – –
2015
First medium-term note of China Construction Eighth Engineering Division Corp. Ltd. in 2015 RMB100 million 29-Apr-15 5 years RMB100 million 107,947 – – – (100,000) – 7,947
Second medium-term note of China Construction Eighth Engineering Division Co., Ltd. in
RMB1.6 billion 17-Aug-15 5 years RMB1.6 billion 823,853 – 38,400 – (843,640) – 18,613
2015
Second medium-term note in 2015 RMB2 billion 5-Nov-15 5 years RMB2 billion 2,010,651 – 63,084 65 (2,073,800) – –
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2015 RMB7 billion 19-Nov-15 7 years RMB7 billion 3,420,557 – 73,834 – (54,700) – 3,439,691
Second term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2015 RMB1 billion 19-Nov-15 5 years RMB1 billion 1,004,536 – 21,072 – (1,015,341) – 10,267
CSCEC FN N 2011 USD500 million 19-Nov-15 6 years USD500 million 3,486,702 – 89,806 (14,157) (3,552,622) (9,729) –
First private Corporate Bond of CITIC Real Estate Co., Ltd. in 2015 RMB4 billion 9-Dec-15 5 years RMB4 billion 1,022,585 – 50,333 6,077 (1,078,995) – –
First medium-term note of China Construction First Building (Group) Corporation Limited. in
RMB600 million 21-Dec-15 5 years RMB600 million 606,449 – 15,631 – (622,080) – –
2015
First private Corporate Bond of CITIC Real Estate Co., Ltd. in 2016 RMB1 billion 15-Jan-16 5 years RMB1 billion 402,302 – 21,003 2,395 (8,775) – 416,925
First medium-term note in 2016 RMB3 billion 11-Apr-16 5 years RMB3 billion 3,056,589 – 84,625 966 (108,000) – 3,034,180
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS
201

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 202
V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

As at 31 December 2020, the amount of bonds payable is as follows (continued):

BAR21010002_E_CSCEC 2020AR()_.indb 202

Opening Issuance Par Closing
balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
CSCEC II N 2106 USD500 million 14-Jun-16 5 years USD500 million 3,485,146 – 93,172 (4,971) (93,172) (215,788) 3,264,387
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2016 RMB6 billion 23-Aug-16 10 years RMB6 billion 6,066,756 – 312,368 – (226,923) – 6,152,201
First medium-term note of China Construction Sixth Engineering Division Co., Ltd. in 2016 RMB500 million 24-Aug-16 5 years RMB500 million 505,316 – 17,400 500 (17,400) – 505,816
First medium-term note of West Construction in 2016 RMB700 million 27-Sep-16 5 years RMB700 million 705,914 – 27,866 – (27,790) – 705,990
First medium-term note in 2017 RMB5 billion 18-Apr-17 3 years RMB5 billion 5,163,109 – 70,178 1,712 (5,234,999) – –
CSCEC II N 2206 USD500 million 6-Jul-17 5 years USD500 million 3,525,873 – 100,074 (4,463) (100,074) (219,411) 3,301,999
NOTES TO THE FINANCIAL STATEMENTS

CSCEC II N 2706 USD500 million 6-Jul-17 10 years USD500 million 3,519,095 – 120,779 (3,322) (120,779) (221,193) 3,294,580
First private Corporate Bond of China Construction Fangcheng Investment &Development
RMB100 million 30-Oct-17 3 years RMB100 million 202,408 – 12,718 144 (215,270) – –
Co., Ltd. in 2017
A-level guaranteed note of Hong Kong in 2017 USD550 million 29-Nov-17 5 years USD550 million 3,797,404 – 132,009 3,513 (132,471) (175,585) 3,624,870
B-level guaranteed note of Hong Kong in 2017 USD250 million 29-Nov-17 10 years USD250 million 1,720,943 – 68,894 1,182 (69,135) (79,516) 1,642,368
First medium-term note of China Overseas Property Group Co., Ltd. in 2018 RMB3 billion 5-Feb-18 3 years RMB3 billion 3,151,430 – 143,169 – (224,840) – 3,069,759
First medium-term note of China Construction Second Engineering Bureau Ltd. in 2018 RMB1 billion 17-Apr-18 5 years RMB1 billion 1,033,847 – 60,911 507 (60,911) – 1,034,354
First private Corporate Bond of China Construction Fangcheng Investment & Development
RMB700 million 24-Apr-18 3 years RMB700 million 726,247 – 38,850 290 (38,850) – 726,537
Co., Ltd. in 2018
No. 4475 guaranteed note of Hong Kong in 2018 USD750 million 26-Apr-18 5 years USD750 million 5,201,210 – 146,313 4,968 (161,887) (239,310) 4,951,294
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

No.4476 guaranteed note of Hong Kong in 2018 USD750 million 26-Apr-18 10 years USD750 million 5,192,784 – 317,218 3,084 (307,741) (238,598) 4,966,747
First medium-term of Corporate Bond China Construction Communications Engineering
RMB500 million 23-Jul-18 5 years RMB500 million 511,178 – 25,500 – (25,500) – 511,178
Group Co., Ltd. in 2018
First medium-term note in 2018 RMB5 billion 15-Aug-18 5 years RMB5 billion 5,031,338 – 265,904 52,116 (235,000) – 5,114,358
Second medium-term note in 2018 RMB5 billion 15-Aug-18 5 years RMB5 billion 5,031,338 – 265,904 52,116 (235,000) – 5,114,358
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2018 RMB3.5 billion 22-Oct-18 6 years RMB3.5 billion 3,527,233 – 134,492 – (96,194) – 3,565,531
First medium-term note of China Construction Seventh Engineering Division Corp. Ltd. in
RMB2 billion 8-Nov-18 3 years RMB2 billion 2,013,587 – 83,200 839 (80,240) – 2,017,386
2018

2021/5/21 13:20:45
 V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

BAR21010002_E_CSCEC 2020AR()_.indb 203

As at 31 December 2020, the amount of bonds payable is as follows (continued):

Opening Issuance Par Closing

balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
Third medium-term note of China Construction Fourth Engineering Division Co. Ltd. in 2018 RMB2 billion 22-Nov-18 3 years RMB2 billion 2,008,147 – 85,197 – (83,800) – 2,009,544
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2019 I RMB2 billion 23-Jan-19 6 years RMB2 billion 2,065,027 – 138,830 – (136,212) – 2,067,645
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2019 II RMB1.5 billion 23-Jan-19 7 years RMB1.5 billion 1,552,705 – 74,374 – (90,841) – 1,536,238
First term of Corporate Bond China Construction Communications Engineering Group Co.,
RMB300 million 10-Apr-19 5 years RMB300 million 310,268 – 14,289 – (14,250) – 310,307
Ltd. in 2019
First medium-term note of CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. in
RMB800 million 20-Jun-19 3+N years RMB800 million 821,133 – 45,219 1,110 (45,840) – 821,622
2019
No. 4437 guaranteed note of Hong Kong in 2019 HKD2 billion 15-Jul-19 5.5 years HKD2 billion 1,787,773 – 76,134 1,197 (72,981) (81,767) 1,710,356
No. 4438 guaranteed note of Hong Kong in 2019 USD450 million 15-Jul-19 10 years USD450 million 3,151,573 – 85,089 1,152 (105,696) (143,696) 2,988,422
No. 40076 guaranteed note of Hong Kong in 2019 USD750 million 27-Nov-19 10 years USD750 million 2,020,796 – 138,530 1,873 (94,420) (93,458) 1,973,321
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB88 million 20-Dec-19 3.082 years RMB88 million 88,114 – 3,471 – – – 91,585
asset support special plan asset-backed securities priority tranche 01
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB129 million 20-Dec-19 6.088 years RMB129 million 129,167 – 5,088 – – – 134,255
asset support special plan asset-backed securities priority tranche 02
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB149 million 20-Dec-19 9.085 years RMB149 million 149,193 – 5,877 – – – 155,070
asset support special plan asset-backed securities priority tranche 03
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB174 million 20-Dec-19 12.09 years RMB174 million 174,225 – 6,864 – – – 181,089
asset support special plan asset-backed securities priority tranche 04
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB201 million 20-Dec-19 15.088 years RMB201 million 201,260 – 7,929 – – – 209,189
asset support special plan asset-backed securities priority tranche 05
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB234 million 20-Dec-19 18.096 years RMB234 million 234,303 – 9,230 – – – 243,533
asset support special plan asset-backed securities priority tranche 06
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB271 million 20-Dec-19 21.093 years RMB271 million 271,350 – 10,691 – – – 282,041
asset support special plan asset-backed securities priority tranche 07
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS
203

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 204
V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

As at 31 December 2020, the amount of bonds payable is as follows (continued):

BAR21010002_E_CSCEC 2020AR()_.indb 204

Opening Issuance Par Closing
balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB315 million 20-Dec-19 24.099 years RMB315 million 315,407 – 12,426 – – – 327,833
asset support special plan asset-backed securities priority tranche 08
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB365 million 20-Dec-19 27.096 years RMB365 million 365,472 – 14,398 – – – 379,870
asset support special plan asset-backed securities priority tranche 09
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project
RMB274 million 20-Dec-19 29.104 years RMB274 million 274,354 – 10,809 – – – 285,163
asset support special plan asset-backed securities priority tranche 10
NOTES TO THE FINANCIAL STATEMENTS

No. 40177 guaranteed note of Hong Kong in 2020 USD300 million 2-Mar-20 5 years USD300 million – 1,962,996 37,080 2,142 (23,784) (5,896) 1,972,538
No. 40178 guaranteed note of Hong Kong in 2020 USD500 million 2-Mar-20 10 years USD500 million – 3,271,661 21,418 2,412 (13,738) (20,141) 3,261,612
No. 40179 guaranteed note of Hong Kong in 2020 USD200 million 2-Mar-20 15 years USD200 million – 1,308,664 17,019 224 (10,916) (216) 1,314,775
First term of CMBS of Beijing China Overseas Plaza Commercial Development Co., Ltd. RMB3.701 billion 28-Apr-20 18 years RMB3.701 billion – 3,698,040 24,403 – (15,902) – 3,706,541
First public Corporate Bond of China State Construction International Group Co., Ltd. to
RMB2 billion 29-Jul-20 3 years RMB2 billion – 1,995,686 29,665 592 – – 2,025,943
professional investors in 2020
First public Corporate Bond of China Overseas Property Group Co., Ltd. for housing leasing
RMB2 billion 14-Aug-20 6 years RMB2 billion – 2,000,000 24,711 – – – 2,024,711
to professional investors in 2020
Second term of CMBS of Beijing China Overseas Plaza Commercial Development Co., Ltd. RMB3 billion 17-Aug-20 18 years RMB3 billion – 3,000,100 16,885 – (11,003) – 3,005,982
First medium-term note of China State Construction International Investments Limited. in
RMB500 million 28-Oct-20 3 years RMB500 million – 500,000 3,072 – – – 503,072
2020
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

First public Corporate Bond of China Overseas Property Group Co., Ltd. to professional
RMB2.4 billion 9-Nov-20 3 years RMB2.4 billion – 2,400,000 11,787 – – – 2,411,787
investors in 2020
First medium-term note of China Overseas Property Group Co., Ltd. in 2020 RMB1.5 billion 10-Dec-20 3 years RMB1.5 billion – 1,500,000 3,150 – – – 1,503,150
Subtotal 126,075,612 21,637,147 5,467,841 132,991 (31,742,602) (2,682,146) 118,888,843
Less: bonds payable due within one year (26,479,014) (30,106,372)
Total 99,596,598 88,782,471

2021/5/21 13:20:45
 V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

BAR21010002_E_CSCEC 2020AR()_.indb 205

As at 31 December 2019, the amount of bonds payable is as follows:
Opening Issuance Par Closing
balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
No. 4503 guaranteed note of Hong Kong in 2010 USD1 billion 10-Nov-2010 10 years USD1 billion 6,821,722 – 375,963 7,160 (375,153) 77,631 6,907,323
Guaranteed note in 2012 HKD1.5 billion 28-Jun-2012 10 years HKD1.5 billion 1,309,539 – 78,991 601 (78,983) 16,483 1,326,631
No. 4579 guaranteed note of Hong Kong in 2012 USD700 million 15-Nov-2012 10 years USD700 million 4,742,382 – 189,001 5,750 (188,633) 59,469 4,807,969
No. 4580 guaranteed note of Hong Kong in 2012 USD300 million 15-Nov-2012 30 years USD300 million 1,997,427 – 108,875 401 (108,661) 24,965 2,023,007
USD100,000 thousand privately raised bonds off Agricultural Bank of China Hong Kong
USD100 million 20-Aug-2013 7 years USD100 million 687,016 – 28,125 444 (27,999) 8,528 696,114
Branch in 2013
B-level guaranteed note of Hong Kong in 2013 USD500 million 29-Oct-2013 10 years USD500 million 3,404,373 – 183,723 3,059 (183,236) 42,485 3,450,404
C-level guaranteed note of Hong Kong in 2013 USD500 million 29-Oct-2013 30 years USD500 million 3,396,328 – 217,904 529 (217,327) 42,266 3,439,700
No. 5746 guaranteed note of Hong Kong in 2014 USD700 million 08-May-2014 10 years USD700 million 4,785,781 – 287,202 (1,396) (290,324) 59,771 4,841,034
No. 6013 guaranteed note of Hong Kong in 2014 USD500 million 11-Jun-2014 20 years USD500 million 3,369,464 – 220,706 1,236 (223,123) 42,087 3,410,370
First targeted medium-term note in 2014 RMB3 billion 22-Apr-2014 5 years RMB3 billion 3,118,671 – 52,003 326 (3,171,000) – –
First medium-term note of China Construction First Building (Group) Corporation Limited. in
RMB400 million 21-Apr-2014 5 years RMB400 million 401,631 – 25,869 – (427,500) – –
2014
Second medium-term note of China Construction First Building (Group) Corporation Limited. in
RMB400 million 16-Sep-2014 5 years RMB400 million 421,343 – 4,257 – (425,600) – –
2014
First medium-term note of China Construction Second Engineering Bureau Ltd. in 2014 RMB600 million 23-May-2014 5 years RMB600 million 621,608 – 13,983 109 (635,700) – –
First medium-term note of China Construction Fourth Engineering Division Co., Ltd. in 2014 RMB300 million 27-Feb-2014 5 years RMB300 million 312,688 – 4,472 – (317,160) – –
Second medium-term note of China Construction Fourth Engineering Division Co., Ltd. in 2014 RMB900 million 16-May-2014 5 years RMB900 million 935,008 – 14,632 1,660 (951,300) – –
First medium-term note of China Construction Fifth Engineering Division Co., Ltd. in 2014 RMB1 billion 20-Aug-2014 5 years RMB1 billion 208,377 – 3,983 – (212,360) – –
No. 5745 guaranteed note of Hong Kong in 2014 USD800 million 8-May-2014 5 years USD800 million 5,439,696 – 77,018 1,295 (5,548,223) 30,214 –
Second medium-term note of China Construction Fifth Engineering Division Co., Ltd. in 2014 RMB200 million 5-May-2014 5 years RMB200 million 1,023,086 – 33,914 – (1,057,000) – –
First medium-term note of China Construction Seventh Engineering Division Co., Ltd. in 2014 RMB900 million 8-Dec-2014 5 years RMB900 million 902,881 – 49,027 112 (952,020) – –
No. 5541 guaranteed note of Hong Kong in 2015 EUR600 million 15-Jul-2015 4 years EUR600 million 4,730,787 – 41,646 6,146 (4,703,250) (75,329) –
Private guaranteed note in 2015 EUR400 million 6-Nov-2015 4 years EUR400 million 3,133,499 – 42,353 6,284 (3,132,079) (50,057) –
First medium-term note in 2015 RMB3 billion 24-Apr-2015 5 years RMB3 billion 3,094,634 – 139,500 114 (139,500) – 3,094,748
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS
205

2021/5/21 13:20:45
 206
V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

As at 31 December 2019, the amount of bonds payable is as follows: (continued)

BAR21010002_E_CSCEC 2020AR()_.indb 206

Opening Issuance Par Closing
balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
First medium-term note of China Construction Seventh Engineering Division Corp. Ltd. in 2015 RMB100 million 24-Apr-2015 5 years RMB100 million 103,696 – 5,480 22 (5,480) – 103,718
First medium-term note of China Construction Eighth Engineering Division Corp. Ltd. in 2015 RMB100 million 29-Apr-2015 5 years RMB100 million 107,947 – – – – – 107,947
Second medium-term note of China Construction Eighth Engineering Division Corp. Ltd. in
RMB1.6 billion 17-Aug-2015 5 years RMB1.6 billion 823,853 – – – – – 823,853
2015
Second medium-term note in 2015 RMB2 billion 05-Nov-2015 5 years RMB2 billion 2,010,576 – 73,800 75 (73,800) – 2,010,651
CSCEC FN N2011 USD500 million 19-Nov-2015 5 years USD500 million 3,416,495 – 101,734 13,798 (101,734) 56,409 3,486,702
NOTES TO THE FINANCIAL STATEMENTS

First medium-term note of China Construction First Building (Group) Corporation Limited. in
RMB600 million 21-Dec-2015 5 years RMB600 million 608,218 – 20,311 – (22,080) – 606,449
2015
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2015 RMB7 billion 19-Nov-2015 6 years RMB7 billion 3,487,271 – 140,882 – (207,596) – 3,420,557
Second term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2015 RMB1 billion 19-Nov-2015 7 years RMB1 billion 1,013,516 – 37,941 – (46,921) – 1,004,536
First private Corporate Bond of CITIC Real Estate Co.,Ltd. in 2015 RMB4 billion 09-Dec-2015 5 years RMB4 billion 1,075,222 – 13,003 10,022 (75,662) – 1,022,585
First private Corporate Bond of CITIC Real Estate Co.,Ltd. in 2016 RMB1 billion 15-Jan-2016 5 years RMB1 billion 1,018,233 – 4,697 (1,548) (619,080) – 402,302
First medium-term note in 2016 RMB3 billion 11-Apr-2016 5 years RMB3 billion 3,055,649 – 108,000 940 (108,000) – 3,056,589
CSCEC II N2106 USD500 million 14-Jun-2016 5 years USD500 million 3,423,854 – 93,113 4,864 (93,113) 56,428 3,485,146
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2016 RMB6 billion 23-Aug-2016 10 years RMB6 billion 6,065,300 – 183,301 – (181,845) – 6,066,756
First medium-term note of China Construction Sixth Engineering Division Co., Ltd. in 2016 RMB500 million 24-Aug-2016 5 years RMB500 million 498,667 – 23,550 499 (17,400) – 505,316
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

First medium-term note of West Construction in 2016 RMB700 million 27-Sep-2016 5 years RMB700 million 706,553 – 27,151 – (27,790) – 705,914
First medium-term note of China Construction Installation Engineering Co., Ltd. in 2016 RMB500 million 18-Jan-2016 3 years RMB500 million 516,900 – – – (516,900) – –
CSCEC II N1906 RMB3.49 billion 24-Jun-2016 3 years RMB3.49 billion 3,431,397 – 35,133 3,869 (3,487,412) 17,013 –
Second medium-term note in 2016 RMB2 billion 22-Jun-2016 3 years RMB2 billion 2,033,359 – 30,986 655 (2,065,000) – –
First medium-term note in 2017 RMB5 billion 18-Apr-2017 3 years RMB5 billion 5,161,761 – 235,000 1,348 (235,000) – 5,163,109
CSCEC II N2206 USD500 million 06-Jul-2017 5 years USD500 million 3,464,422 – 100,010 4,361 (100,010) 57,090 3,525,873
CSCEC II N2706 USD500 million 06-Jul-2017 10 years USD500 million 3,458,877 – 120,702 3,233 (120,702) 56,985 3,519,095

2021/5/21 13:20:45
 V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

BAR21010002_E_CSCEC 2020AR()_.indb 207

As at 31 December 2019, the amount of bonds payable is as follows: (continued)

Opening Issuance Par Closing

balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
First private Corporate Bond of China Construction Fangcheng Investment & Development
RMB300 million 30-Oct-2017 3 years RMB300 million 202,273 – 15,270 135 (15,270) – 202,408
Co., Ltd. in 2017
A-level guaranteed note of Hong Kong in 2017 USD550 million 29-Nov-2017 5 years USD550 million 3,746,936 – 128,959 3,319 (128,881) 47,071 3,797,404
B-level guaranteed note of Hong Kong in 2017 USD250 million 29-Nov-2017 10 years USD250 million 1,698,470 – 67,302 1,111 (67,261) 21,321 1,720,943
First medium-term note of China Overseas Property Group Co., Ltd. in 2018 RMB3 billion 05-Feb-2018 3 years RMB3 billion 3,058,980 – 165,563 – (73,113) – 3,151,430
First medium-term note of China Construction Second Engineering Bureau Ltd. in 2018 RMB1 billion 17-Apr-2018 5 years RMB1 billion 1,033,365 – 50,300 482 (50,300) – 1,033,847
First private Corporate Bond of China Construction Fangcheng Investment & Development
RMB700 million 24-Apr-2018 3 years RMB700 million 725,933 – 38,850 314 (38,850) – 726,247
Co., Ltd. in 2018
No. 4475 guaranteed note of Hong Kong in 2018 USD750 million 26-Apr-2018 5 years USD750 million 5,131,794 – 217,909 4,659 (217,304) 64,152 5,201,210
No. 4476 guaranteed note of Hong Kong in 2018 USD750 million 26-Apr-2018 10 years USD750 million 5,125,249 – 243,546 2,877 (242,869) 63,981 5,192,784
First term of Corporate Bond China Construction Communications Engineering Group Co., Ltd.
RMB500 million 23-Jul-2018 5 years RMB500 million 511,333 – 25,345 – (25,500) – 511,178
in 2018
First medium-term note in 2018 RMB5 billion 15-Aug-2018 5 years RMB5 billion 5,017,635 – 235,000 13,703 (235,000) – 5,031,338
Second medium-term note in 2018 RMB5 billion 15-Aug-2018 5 years RMB5 billion 5,017,635 – 235,000 13,703 (235,000) – 5,031,338
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2018 RMB3.5 billion 22-Oct-2018 6 years RMB3.5 billion 3,549,150 – 137,969 – (159,886) – 3,527,233
First medium-term note of China Construction Seventh Engineering Division Co., Ltd. in 2018 RMB2 billion 08-Nov-2018 3 years RMB2 billion 2,009,018 – 86,957 812 (83,200) – 2,013,587
Third medium-term note of China Construction Fourth Engineering Division Co. Ltd. in 2018 RMB2 billion 22-Nov-2018 3 years RMB2 billion 2,008,150 – 83,800 (3) (83,800) – 2,008,147
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2019 I RMB2 billion 23-Jan-2019 6 years RMB2 billion – 2,000,000 65,027 – – – 2,065,027
First term of Corporate Bond of China Overseas Property Group Co., Ltd. in 2019 II RMB1.5 billion 23-Jan-2019 7 years RMB1.5 billion – 1,500,000 52,705 – – – 1,552,705
First term of asset-backed notes priority tranche of Shanghai CSCEC Dongfu RMB1.52 billion 12-Apr-2019 3 years RMB1.52 billion – 1,520,000 38,983 – (1,558,983) – –
First term of Corporate Bond China Construction Communications Engineering Group
RMB300 million 10-Apr-2019 5 years RMB300 million – 300,000 10,268 – – – 310,268
Co., Ltd. in 2019
First medium-term note of CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. in
RMB800 million 20-Jun-2019 3+N years RMB800 million – 800,000 23,353 (2,220) – – 821,133
2019
No. 4437 guaranteed note of Hong Kong in 2019 HKD2 billion 15-Jul-2019 5.5 years HKD2 billion – 1,742,000 23,766 (6,275) – 28,282 1,787,773
No. 4438 guaranteed note of Hong Kong in 2019 USD450 million 15-Jul-2019 10 years USD450 million – 3,064,265 50,310 (12,857) – 49,855 3,151,573
No. 40076 guaranteed note of Hong Kong in 2019 USD294 million 27-Nov-2019 10 years USD294 million – 2,004,301 5,475 (20,951) – 31,971 2,020,796
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS
207

2021/5/21 13:20:45
 208
V. Notes to the consolidated financial statements (continued)

36. Bonds payable (continued)

As at 31 December 2019, the amount of bonds payable is as follows: (continued)

BAR21010002_E_CSCEC 2020AR()_.indb 208

Opening Issuance Par Closing
balance of during interest Interest Others balance of
Par value Issuance date Maturity Issuance amount the year the year accrued adjustment Repayment (Note) the year
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB88 million 20-Dec-2019 3.082 years RMB88 million – 88,000 114 – – – 88,114
support special plan asset-backed securities priority tranche 01
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB129 million 20-Dec-2019 6.088 years RMB129 million – 129,000 167 – – – 129,167
support special plan asset-backed securities priority tranche 02
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB149 million 20-Dec-2019 9.085 years RMB149 million – 149,000 193 – – – 149,193
support special plan asset-backed securities priority tranche 03
NOTES TO THE FINANCIAL STATEMENTS

China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB174 million 20-Dec-2019 12.09 years RMB174 million – 174,000 225 – – – 174,225
support special plan asset-backed securities priority tranche 04
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB201 million 20-Dec-2019 15.088 years RMB201 million – 201,000 260 – – – 201,260
support special plan asset-backed securities priority tranche 05
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB234 million 20-Dec-2019 18.096 years RMB234 million – 234,000 303 – – – 234,303
support special plan asset-backed securities priority tranche 06
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB271 million 20-Dec-2019 21.093 years RMB271 million – 271,000 350 – – – 271,350
support special plan asset-backed securities priority tranche 07
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB315 million 20-Dec-2019 24.099 years RMB315 million – 315,000 407 – – – 315,407
support special plan asset-backed securities priority tranche 08
China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB365 million 20-Dec-2019 27.096 years RMB365 million – 365,000 472 – – – 365,472
support special plan asset-backed securities priority tranche 09
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

China Construction Third Engineering Bureau Co., Ltd.-Shiyan Pipe Gallery PPP project asset
RMB274 million 20-Dec-2019 29.104 years RMB274 million – 274,000 354 – – – 274,354
support special plan asset-backed securities priority tranche 10
Subtotal 139,175,628 15,130,566 5,552,443 74,777 (34,686,873) 829,071 126,075,612
Less: bonds payable due within one year (29,730,111) (26,479,014)
Total 109,445,517 99,596,598

Note: Others are mainly caused by change of foreign exchange rate.

2021/5/21 13:20:45
 NOTES TO THE FINANCIAL STATEMENTS
209
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

V. Notes to the consolidated financial statements (continued)

37. Long-term payables

31 December 2020 31 December 2019

Project quality warranty payable 22,710,864 26,917,481
Payables for finance leases 1,114,428 390,313
Payables for minority interest financing 1,542,377 2,293,675
Payables for leasing companies 570,125 1,189,334
Others 2,877,095 3,042,676
Subtotal 28,814,889 33,833,479
Less: current portion of long-term payables (Note V. 33) (11,314,629) (13,936,249)
Total 17,500,260 19,897,230

38. Long-term employee benefits payable

31 December 2020 31 December 2019

Net defined benefit liability (a) 1,955,040 1,984,467
Long-term termination benefits (b) 64,000 103,662
Subtotal 2,019,040 2,088,129
Less: Termination benefits expected to be paid within one year
(19,620) (23,640)
  (Note V. 30)
Total 1,999,420 2,064,489

(a) Net defined benefit liability

The Company pays supplementary retirement benefits for its employees who retired on or before 31 March 2007 in
addition to the contribution made to statutory insurance schemes. Such supplementary retirement benefits are defined
benefit plans. The present value of the defined benefit plan obligation is calculated annually by the external independent
actuary Towers Watson Consulting Company based on the interest rate of the national debt similar to the obligation period
and currency, using the expected cumulative benefit unit method.

The principal actuarial assumptions used as at the balance sheet date are as follows:
31 December 2020 31 December 2019
Discount rate 3.25% 3.25%
Annual growth rate of living expenses for the family dependents of
  deceased employees 4.50% 4.50%
Annual growth rate of average medical expenses 8.00% 8.00%
Annual growth rate of supplementary welfare for retired employees 0.00% 0.00%
Move three years
Move three years
backward annuity
backward annuity life
life chart of China’s
chart of China’s Life
Mortality rate Life Insurance
Insurance Industry of
Industry of man/
man/women
women
(Year 2010-2013)
(Year 2010-2013)

The quantitative sensitivity analysis for significant assumptions used is as follows:

31 December 2020
defined benefit defined benefit
Increase obligations Decrease obligations
% Increase % Increase
Discount rate 0.25 (37,510) 0.25 38,950

BAR21010002_E_CSCEC 2020AR()_.indb 209 2021/5/21 13:20:46

 NOTES TO THE FINANCIAL STATEMENTS
210
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

V. Notes to the consolidated financial statements (continued)

38. Long-term employee benefits payable (continued)

(a) Net defined benefit liability (continued)

The quantitative sensitivity analysis for significant assumptions used is as follows: (continued)

31 December 2019
defined benefit defined benefit
Increase obligations Decrease obligations
% Increase % Increase
Discount rate 0.25 (38,050) 0.25 39,540

The sensitivity analysis above has been determined based on a method that extrapolates the impact on defined benefit
obligations as a result of reasonable changes in key assumptions occurring at the balance sheet date. The sensitivity
analysis is based on a change in a significant assumption, keeping all other assumptions constant. The sensitivity
analysis may not be representative of an actual change in the defined benefit obligations as it is unlikely that changes in
assumptions would occur in isolation of one another.

The total expenses recognised in profit or loss in respect of the plan are as follows:
2020 2019
Past service cost 100,530 73,297
Net interest 57,660 61,140
Net cost of post-employment benefits 158,190 134,437
Recognised in administrative expenses 100,530 73,297
Recognised in finance expenses 57,660 61,140
Total 158,190 134,437

Movements in the present value of defined benefit obligations are as follows:

2020 2019
Opening balance 1,984,467 2,035,172
Included in profit or loss
  Past service cost 100,530 73,297
  Net interest 57,660 61,140
Included in other comprehensive income
  Actuarial losses 44,020 27,690
  Other changes
  Benefits paid (231,637) (212,832)
Closing balance 1,955,040 1,984,467

(b) Long-term termination benefits

Some of the Group’s employees early retired. At the balance sheet date, the main actuarial assumptions used to determine
the Group’s early retirement benefits payable are as follows:
31 December 2020 31 December 2019
Discount rate 2.75% 2.75%
Annual growth rate of living expenses for the family dependents of
  deceased employees 4.50% 4.50%
Annual growth rate of average medical expenses 8.00% 8.00%
Move three years
Move three years
backward annuity
backward annuity life
life chart of China’s
chart of China’s Life
Mortality rate Life Insurance
Insurance Industry of
Industry of man/
man/women
women
(Year 2010-2013)
(Year 2010-2013)

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V. Notes to the consolidated financial statements (continued)

38. Long-term employee benefits payable (continued)

(b) Long-term termination benefits (continued)

Early retirement benefits recognised in profit or loss are as follows:
2020 2019
General and administrative expenses (220) 12,407
Finance expenses 1,830 2,110
1,610 14,517

39. Provisions

2020
Opening Increase Decrease Closing
balance of during during balance of
the year the year the year the year
Pending litigations 2,684,015 490,440 (69,179) 3,105,276
Warranties 663,707 1,067,776 (546,633) 1,184,850
Others 810,306 465,092 (940,808) 334,590
Subtotal 4,158,028 2,023,308 (1,556,620) 4,624,716
Less: current portion of provisions (49,294) (775,056)
Total 4,108,734 3,849,660

40. Deferred income

31 December 2020 31 December 2019

Government grant 463,753 440,499
Others 18,737 4,296
Total 482,490 444,795

As at 31 December 2020, government grants related to liabilities were as follows:

Amount
Amount recognised
recognised in non- Other
Opening Increase in other operating changes Closing Related to
balance during income income during balance assets/
of the the during the during the the of the Related to
year year year year year year income
Government Compensation for
Workshop construction of Related to
118,314 28,860 (5,171) – – 142,003
Guangdong Construction Base assets
Co., Ltd.
Government Compensation
for Demolition of Tangshan Related to
82,432 – – (5,024) – 77,408
Fengrun District Linyin Road assets
West Side Land
Government Compensation for
Related to
Demolition of Guiyang Dayingpo 75,001 – (2,370) – – 72,631
assets
Renovation Project
Compensation for Tianjin Steel Related to
33,224 – – (758) – 32,466
Structure Land assets
Related to
Others 131,528 90,692 (43,510) (9,996) (29,469) 139,245 assets and
income
Total 440,499 119,552 (51,051) (15,778) (29,469) 463,753

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

V. Notes to the consolidated financial statements (continued)

40. Deferred income (continued)

As at 31 December 2019, government grants related to liabilities were as follows:

Amount
Amount recognised
recognised in non- Other
Opening Increase in other operating changes Closing Related to
balance during income income during balance assets/
of the the during the during the the of the Related to
year year year year year year income
Government Compensation for
Workshop Construction of Related to
33,660 84,654 – – – 118,314
Guangdong Construction assets
Base Co., Ltd
Government Compensation
for Demolition of Tangshan Related to
87,480 – – (5,048) – 82,432
Fengrun District Linyin Road assets
West Side Land
Government Compensation for
Related to
Demolition of Guiyang Dayingpo 77,371 – – (2,370) – 75,001
assets
Renovation Project
Compensation for Tianjin Steel Related to
33,982 – – (758) – 33,224
Structure Land assets
Related to
Others 154,852 78,715 (49,791) (17,859) (34,389) 131,528 assets and
income
Total 387,345 163,369 (49,791) (26,035) (34,389) 440,499

41. Other non-current liabilities

31 December 2020 31 December 2019

Exchangeable bonds in 2016 (Note 1) 4,421,322 4,695,968
Prepaid investment of convertible bonds in 2015 (Note 2) 1,520,302 1,625,455
VAT output to be transferred 920,352 1,415,728
Contract liabilities over one year 634,526 583,797
Total 7,496,502 8,320,948
Note 1: The Group’s subsidiary China Overseas Finance Investment (Cayman) V Limited (here in after “the issuer”) publicly
issued exchangeable bonds of USD1.5 billion on Hong Kong Stock Exchange on 6 January 2016. The bonds are
guaranteed by China Overseas Holdings Limited, and the maturity date is 5 January 2023. Related clauses are as
follows:
(1) The bondholder is entitled to apply for redemption of bonds at 111.54% of par value on 5 January 2020;
(2) In cases of the change of guarantor, or delisting or restricted trading of China Overseas Land & Investment
Ltd. on Hong Kong Stock Exchange, bond holders have the right to require the issuer to redeem the bonds
readily;
(3) Bond holders have the right to apply for redemption on maturity date at 121.07% of par value;
(4) During the exchange period from 15 February 2016 to 8 work days before maturity date, bond holders have
the right to exchange the bonds for ordinary shares of China Overseas Land & Investment Ltd., the par
value of which is HKD0.10, at the price of HKD41.50 per share;
(5) At any time from 5 January 2020 to 7 work days before maturity date, if the stock price of China Overseas
Land & Investment Ltd. during 15 trading days is continuously higher than 130% of early redemption price
set in the agreement divided by exchange rate, the issuer has the right to carry out exchange in the full (not
partial) amount, and should release notice in no more than 3 days after the matter occurs.
Exchangeable bonds in 2016 were recognised as financial liabilities at fair value through profit or loss in the first
place and disclosed in other non-current liabilities. Since the issuer and bondholders reached an agreement in
December 2019 to partially redeem in 2020, the redemption amount is equivalent to RMB6,939,864 thousand
which disclosed in other non-current liabilities (Note V. 33), of which non-current portion due with one year was fully
redeemed on 5 January, 2020.
Note 2: Related information regarding prepaid investment of convertible bonds in 2015:
Strategic Capital, LLC, a subsidiary of the Group, received a prepaid investment of USD300 million from Riton
Holdings Corporation Limited, a wholly-owned subsidiary of Guoxin International Investment Co., Ltd. As at 31
December 2020,under the convertible bond framework agreement entered into by both parties, and the relevant
conversion clauses under the framework agreement have not yet been determined, and Strategic Capital, LLC has
redeemed a total of US$67 million.

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V. Notes to the consolidated financial statements (continued)

42. Paid-in capital

2020
Opening Movement Closing
balance of during the year balance of
the year Others the year
Shares not subjected to trading restriction 41,141,075 112,528 41,253,603
Shares subjected to trading restriction 834,555 (123,086) 711,469
Total 41,975,630 (10,558) 41,965,072

2019
Opening Movement Closing
balance of during the year balance of
the year Others the year
Shares not subjected to trading restriction 41,624,385 (483,310) 41,141,075
Shares subjected to trading restriction 360,789 473,766 834,555
Total 41,985,174 (9,544) 41,975,630

43. Other equity instruments

2020
Opening balance of the year Increase during the year Decrease during the year Closing balance of the year
amount net book value amount net book value amount net book value amount net book value
Preference Share (a) 150,000,000 14,975,410 – – 150,000,000 14,975,410 – –
Perpetual Bond (b) – 6,000,000 – 10,000,000 – 6,000,000 – 10,000,000
Total 20,975,410 10,000,000 20,975,410 10,000,000

2019
Opening balance of the year Increase during the year Decrease during the year Closing balance of the year
amount net book value amount net book value amount net book value amount net book value
Preference Share (a) 150,000,000 14,975,410 – – – – 150,000,000 14,975,410
Perpetual Bond (b) – 7,996,770 – – – 1,996,770 – 6,000,000
Total 22,972,180 – 1,996,770 20,975,410

(a) Preference Share

The Company obtained approval on its non-public issue preference shares (Guozi Chanquan ([2014] No. 436) from the
SASAC and permission about its non-public issue preference shares (Zhengjian Approval [2014] No. 1419) from China
Securities Regulatory Commission on 10 June 2014 and 25 December 2014, respectively, which approved the Company
to non-publicly issue preference shares to qualified investors, with total shares no more than 300,000,000 and initial issued
shares no less than 150,000,000, at the issue price of RMB100 per share. During the period of 5 years commencing from
the first value date of each tranche, the Company is entitled to redeem and cancel all or part of the preference shares of
such tranche at the dividend payment date of such shares each year. The holders have no redemption right to sell them
back to the Company. Unless the mandatory interest payment events whose occurrence can be decided by the Company
itself incurred, the Company’s meeting of shareholders is empowered to decide to cancel all or part of dividends of
preference shares, which will not constitute a default by the Company, and the dividends of preference shares issued at
the time will not be accumulated. The Company received an actual amount of RMB14,975,410 thousand after deducting
related transaction expenses from the total amount collected by initial issuance of 150,000,000 preference shares on 2
March 2015, and classified such amount as other equity instruments.

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

V. Notes to the consolidated financial statements fifth and each interest payment date thereafter,
the Company will be entitled to redeem the
(continued) medium-term note at par value plus interest
payable (including all deferred interest and
43. Other equity instruments (continued) accrued interest) (the “Right of redemption”).
The holders of the medium-term note have no
(a) Preference Share (continued) redemption right to sell it back to the Company.
At each interest payment date, the Company
The dividends of preference shares the Company can at its own discretion choose to postpone
decided to pay will be paid annually. Dividend payment of the interest for current-period
payment date is the day of 1 year commencing from as well as interest deferred in accordance
the payment deadline for the issuance of preference with the Clauses to the next interest payment
shares, while the dividend payment date for the initially date unless the mandatory interest payment
issued preference shares is 2 March. If such date is a events whose occurrence can be decided by
legal holiday or non-working day, it will be postponed the Company itself incurred. The Company
to the next working day, and dividends payable will classified the actual amount received as other
not bear interest during the postponement. Preference equity instruments.
shares issued at the time are at fixed dividend rate
attached with one-time rate raise arrangement. Nominal The nominal interest rate of the medium-term
dividend rate of the initially issued preference shares is notes will be fixed in the first 5 years with
determined to be and kept at 5.80% for the 1st to 5th annual interest rate of 6.2%. The annual interest
dividend accrual years through enquiry method. From rate will be reset to the current benchmark
the 6th dividend accrual year, if the Company does not interest rate plus initial interest-rate spread (i.e.
exercise all of the rights of redemption, dividend rate the variance between nominal interest rate and
per share will be 2 percentage points higher than that benchmark interest rate at the issue date) and
of the1st to 5th dividend accrual years, and will remain 200 basis points every 5 years from the sixth
the same after the adjustment in the 6th dividend interest-bearing year, if the Company did not
accrual year. exercise the Right of redemption.
The aforementioned mandatory interest payment The aforementioned mandatory interest
events comprise of one of the two circumstances payment events comprise one of circumstances
below occurring within 12 months before dividend below occurring within 12 months before
payment date: (1) Distribution of dividends to dividend payment date:(1) Distribution of
ordinary shareholders (including cash, shares, the dividends to ordinary shareholders; (2) Capital
combination of cash and shares and other legitimate withdrawal by shareholders (except for the
patterns); (2) Capital withdrawal by shareholders redemption and cancellation of shares incurred
(except for the redemption and cancellation of shares by incentive plan, or the redemption and
incurred by equity incentive plan, or the redemption cancellation of ordinary shares by issuance of
and cancellation of ordinary shares by issuance of preference shares).
preference shares).
On 5 September 2019, the fifth interest payment
Pursuant to the resolution on the redemption of date of the perpetual bond, in accordance with
150,000,000 unlisted preference shares of China the terms of the issuance terms, the Company
Construction Co., Ltd., which were approved at the exercised the Right of redemption at the face
first extraordinary general meeting of the Company in value plus interest payable and fully redeemed
2020 dated 19 February 2020, the Company redeemed the bonds held by the holders.
all preference shares held by all the preference
(2) On 6 March 2018, the Company entered into
shareholders of the Company on 2 March 2020. After
a perpetual bond contract with China Credit
this redemption, the number of preference shares of
Trust Co., Ltd., of which the value date was 7
the Company is zero.
March 2018 and the bond can be redeemed
As at 31 December 2020, the Company had no by the Company on 6 September 2018 and
outstanding preference shares (31 December 2019: thereafter. The amount of the bond was RMB6
RMB14,975,410 thousand). billion and the actual amount received was
RMB6 billion. According to the clauses of
(b) Perpetual Bond the contract, unless an event triggered by
an accelerated repayment mechanism that
(1) On 4 September 2014, the Company issued
can be decided by the Company or by the
second medium-term note, of which the
redemption rights occurs, the perpetual debt
value date was 5 September 2014, and it
will survive for a long period of time, or unless
can be redeemed by the Company in 2019
a compulsory interest payment event occurs
and thereafter. The total issuance amount
that can be decided by the Company. The
was RMB2,000,000 thousand, and the actual
Company may defer the current interest and all
amount received was RMB1,996,770 thousand
interest that has been deferred on each interest
after deduction of related transaction expenses
payment day at its own discretion. Payment is
such as underwriting fees. According to
made on the next interest payment day and is
the clauses of the medium-term note (the
not subject to any number of deferred interest
“Clauses”), the term of the medium-term
payments. The Company credits the perpetual
note will be indefinite unless the Company
debt to other equity instruments.
redeemed the note under the Clauses. At the

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CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

V. Notes to the consolidated financial statements The value date of the company’s issuance from
April 16 to April 17, 2020 is April 20, 2020, the
(continued) 2020 third-phase medium-term notes, which
can be redeemed on and after April 20, 2023,
43. Other equity instruments (continued) have a total issuance of RMB3 billion, and
actually received RMB3 billion. According to
(b) Perpetual Bond (continued) the issuance terms of the batch of medium-
(2) (continued) term notes, the batch of medium-term notes
will last for a long time before being redeemed
The nominal interest rate of the medium-term by the Company. On the third and every
notes will be fixed in the first 2 years with subsequent interest payment date of the batch
annual interest rate of 6.5%. The annual interest of medium-term notes, the company has the
rate will be reset to the current benchmark right to redeem the batch of medium-term notes
interest rate plus initial interest-rate spread (hereinafter referred to as Right of “redemption”)
(i.e. the variance between nominal interest rate at face value plus interest payable (including all
and benchmark interest rate at the issue date) deferred interest and its yield). Investors of this
and 200 basis points every 2 years from the batch of medium-term notes have no right to
third interest-bearing year, if the Company did sell back. Unless there is a compulsory interest
not exercise the Right of redemption. The final payment event that can be determined by the
rested interest rate will not exceed 10%. company to control whether it occurs, on each
interest payment date of the batch of medium-
The accelerated repayment mechanism
term notes, the company can choose to include
mentioned previously include: (a) One of the
the current interest and all interest and its
following situations occurs before the deferred
fruits that have been deferred in accordance
payment of investment income and its fruits
with the terms. Interest is deferred to the next
is completed (1) Distribution of dividends to
interest payment date, and is not subject to
ordinary shareholders. (2) Capital withdrawal
any restrictions on the number of deferred
by shareholders (except for the redemption and
interest payments. The company accounts for
cancellation of shares incurred by incentive
the amount actually received after deducting
plan, or the redemption and cancellation of
the relevant transaction costs from the total
ordinary shares by issuance of preference
issuance as other equity instruments.
shares). (b) Events of breach of contract for
perpetual bond. The coupon rate of this batch of medium-term
notes remained unchanged for the first three
The aforementioned mandatory interest
interest-bearing years. The annual interest
payment events comprise one of circumstances
rate of the first phase of medium-term notes
below occurring within 12 months before
in 2020 is 3.29%, and the annual interest rate
dividend payment date: (1) Distribution of
of the second phase of medium-term notes
dividends to ordinary shareholders; (2) Capital
in 2020 is 3.10%. The annual interest rate of
withdrawal by shareholders (except for the
the third-phase medium-term notes is 3.09%.
redemption and cancellation of shares incurred
If the Company does not exercise the Right
by incentive plan, or the redemption and
of redemption, the annual interest rate will
cancellation of ordinary shares by issuance of
be reset every 3 years based on the current
preference shares).
benchmark interest rate plus the initial spread
On 6 March, 2020, which is the expiry date of plus 300 basis points from the fourth interest
the investment period after the second interest calculation year. Among them, the initial spread
payment date of the perpetual bond, the is the difference between the coupon rate and
Company exercised the Right of redemption the initial benchmark interest rate.
at the face value and the interest payable in
The aforementioned compulsory interest
accordance with the terms of the issuance, and
payment event refers to one of the following
fully redeemed bonds held by the holders.
circumstance occurring within 12 months
(3) During the period from 1 April 2020 to 2 April before the interest payment date: (1) Dividend
2020, the Company issued the 2020 first-phase distribution to ordinary shareholders (except
medium-term notes of which the value date for the profit paid by a wholly state-owned
was 3 April 2020, and it can be redeemed by enterprise); (2) Reduction of registered capital.
the Company on 3 April 2023 and there after. The issuer promises that there is no hidden
The total issuance amount was RMB4,000,000 compulsory dividend.
thousand, and the actual amount received was
As of 31 December 2020, the carrying amount
RMB4,000,000 thousand. The value date of
of the perpetual bonds issued by the Company
issuance from April 9 to April 10, 2020 is April
was RMB10,000,000 thousand (31 December
13, 2020, and it can be issued on April 13,
2023 The second-phase medium-term notes 2019: RMB6,000,000 thousand).
can be redeemed on April 3, 2023 and beyond
and thereafter has a total issuance of RMB3
billion, and the actual receipt of RMB3 billion.

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V. Notes to the consolidated financial statements (continued)

44. Capital reserve

2020
Opening Closing
balance of the Increase during Decrease during balance of the
year the year (Note) the year year
Capital premium 10,377,619 582,530 (2,262,251) 8,697,898
Others 1,649,991 511,805 (593,943) 1,567,853
Total 12,027,610 1,094,335 (2,856,194) 10,265,751

2019
Opening Closing
balance of the Increase during Decrease during balance of the
year the year (Note) the year year
Capital premium 10,184,032 237,955 (44,368) 10,377,619
Others 1,078,257 749,512 (177,778) 1,649,991
Total 11,262,289 987,467 (222,146) 12,027,610

Note: Increase in share premium is mainly due to the second batch of second-phase restricted stocks unlocked on 29
December, 2019, the third batch of second-phase restricted stocks unlocked on 29 December,2020,the first batch of
third-phase restricted stocks unlocked on 26 December, 2020 (as described in Note XI), and the impact on changes
in the shareholding ratio of subsidiaries. The changes in other capital reserve were mainly due to the share option
expenses recognized, and changes in the equity of the investee accounted for under the equity method other than
the changes recorded in comprehensive income and profit distribution.

45. Other comprehensive income

Accumulated balance of other comprehensive income attributable to owners of the parent in the consolidated balance
sheet:

2020
1 January Increase/ 31 December
2020 decrease 2020
Remeasurement gains or losses of a defined benefit plan (199,879) (44,024) (243,903)
Change in the fair value of other equity investments 214,612 (1,043,539) (828,927)
Other comprehensive income of the investee accounted for
under the equity method which will be reclassified to profit (987,607) 95,073 (892,534)
or loss subsequently
Change in the fair value of other debt investments 6,579 (22,825) (16,246)
Exchange differences on translation of foreign currency
(810,450) 1,612,659 802,209
financial statements
Total (1,776,745) 597,344 (1,179,401)

2019
1 January Increase/ 31 December
2019 decrease 2019
Remeasurement gains or losses of a defined benefit plan (172,189) (27,690) (199,879)
Change in the fair value of other equity investments (846,842) 1,061,454 214,612
Other comprehensive income of the investee accounted for
under the equity method which will be reclassified to profit (798,405) (189,202) (987,607)
or loss subsequently
Change in the fair value of other debt investments (4,904) 11,483 6,579
Exchange differences on translation of foreign currency
(535,185) (275,265) (810,450)
financial statements
Total (2,357,525) 580,780 (1,776,745)

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V. Notes to the consolidated financial statements (continued)

45. Other comprehensive income (continued)

Amount of other comprehensive income:

2020
Less:
Reclassification
of other
comprehensive Attributable to Attributable to
income to Less: owners of the non-controlling
Before tax profit or loss Income tax parent interests
Other comprehensive income that will not be
  reclassified to profit or loss
  Remeasurement gains or losses of a defined benefit plan (44,020) – – (44,024) 4
  Change in the fair value of other equity investments (1,047,553) 310,690 (314,779) (1,043,539) 75
Other comprehensive income that may be
  reclassified to profit or loss
  Other comprehensive income of the investee
   accounted for under the equity method which 322,308 – – 95,073 227,235
   will be reclassified to profit or loss
  Change in the fair value of other debt investments (34,829) – – (22,825) (12,004)
  Exchange differences on translation of foreign
1,427,345 – – 1,612,659 (185,314)
   currency financial statements
Total 623,251 310,690 (314,779) 597,344 29,996

2019
Less:
Reclassification
of other
comprehensive Attributable to Attributable to
income to Less: owners of the non-controlling
Before tax profit or loss Income tax parent interests
Other comprehensive income that will not be
  reclassified to profit or loss
  Remeasurement gains or losses of a defined benefit plan (27,690) – – (27,690) –
  Change in the fair value of other equity investments 1,401,844 2,245 338,042 1,061,454 103
  Exchange differences on translation of foreign currency
129,779 – – – 129,779
  financial statements
Other comprehensive income that may be reclassified
  to profit or loss
  Other comprehensive income of the investee accounted
   for under the equity method which will be reclassified (304,360) – – (189,202) (115,158)
   to profit or loss
  Change in the fair value of other debt investments 13,810 (8,298) – 11,483 10,625
  Exchange differences on translation of foreign currency
(275,265) – – (275,265) –
  financial statements
Total 938,118 (6,053) 338,042 580,780 25,349

46. Special reserve

2020
Opening balance Increase during Decrease Closing balance
of the year the year during the year of the year
Safety production funds 88,474 26,513,826 (26,466,531) 135,769

2019
Opening balance Increase during Decrease Closing balance
of the year the year during the year of the year
Safety production funds 77,329 23,237,877 (23,226,732) 88,474

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V. Notes to the consolidated financial statements (continued)

47. Surplus reserve

2020
Opening balance Increase during Closing balance
of the year the year of the year
Statutory surplus reserve 7,716,149 2,385,483 10,101,632

2019
Changes in
Balance at accounting Opening Increase Closing
the end of policies balance during the balance
prior year (Note 1) of the year year of the year
Statutory surplus reserve 6,003,665 72,060 6,075,725 1,640,424 7,716,149

Note 1: As at 1 January 2019, due to the first implementation of the New Financial Instruments Standard, the adjustment of
the surplus reserve was RMB72,060 thousand.
According to the provisions of the Company Law and the Company’s Articles of Association, the Company appropriates
10% of the net profit to the statutory surplus reserve. Where the accumulated amount of the surplus reserve reaches 50%
or more of the Company’s registered capital, further appropriation is not required.
When approved, the statutory surplus reserve can be used to make up for accumulated losses or converted to the paid-in
capital.

48. Retained earnings

2020 2019
Retained earnings at the beginning of the year before adjustment 197,541,411 165,628,207
Adjustments (Note 1) – 516,681
Retained earnings at the beginning of the year after adjustment 197,541,411 166,144,888
Net profit attributable to owners of the parent 44,944,250 41,881,399
Other comprehensive income included in the previous year 310,690 2,245
Others (58,965) 3,492
Less: Appropriation for statutory surplus reserve (Note V. 47) 2,385,483 1,640,424
    Appropriation to general reserve (Note 2) 232,563 494,541
    Ordinary share dividends payable (Note 3) 7,763,538 7,052,853
    Dividends payable to other equity holders (Note 4) 402,574 1,302,795
Retained earnings at the end of year 231,953,228 197,541,411

Note 1: As at 1 January 2019, due to the first implementation of the New Financial Instruments Standard, the undistributed
profit at the beginning of 2019 was increased by RMB516,681 thousand.
Note 2: Appropriation to general reserve
China State Construction Finance Co., Ltd., a subsidiary of the company:
In accordance with the requirements of the Administrative Measures for the Provision of Reserves of Financial
Enterprises (Cai Jin [2012] No. 20), financial institutions (including financial companies) should provide general risk
reserve for assets bearing risks and losses at the balance sheet date. The general reserve shall be appropriated
from net profit as profit distribution with an appropriation ratio not lower than 1.5% of risk assets at the end of year.
If it’s difficult for financial institutions to appropriate 1.5% general reserve at one time, it can also be made in years
but principally not more than 5 years. The general risk reserve of China State Construction Finance Co., Ltd. in
2020 was RMB285,584 thousand, of which the amount attributable to shareholders of the parent company was
RMB228,467 thousand. It was fully withdrawn on 31 December 2020.
China State Construction Commercial Factoring Co., Ltd., a subsidiary of the company:
According to the “Notice of the General Office of the China Banking and Insurance Regulatory Commission on
Strengthening the Supervision and Management of Commercial Factoring Enterprises” issued by the General
Office of the China Banking and Insurance Regulatory Commission (issued by the Office of the China Banking
and Insurance Regulatory Commission [2019] No. 205), China State Construction Commercial Factoring Co., Ltd.
accrues the risk reserve. The general risk reserve is when the financing factoring funds are overdue, bad or in the
event of unforeseen risks, in order to maintain the funds for the normal operation of the enterprise, the risk reserve
should not be less than 1% of the balance at the end of the financial factoring business. The general risk reserve of
China State Construction Commercial Factoring Co., Ltd. in 2020 was RMB4,096 thousand. It was fully withdrawn
on 31 December 2020.

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V. Notes to the consolidated financial statements (continued)

48. Retained earnings (continued)

Note 3: According to the resolution at the General Meeting of Shareholders dated 25 May 2020, the Company proposed a
cash dividend of RMB0.185 (before tax) per share to the shareholders on 24 June 2020, multiplied by the number
which resulted in the total amount of RMB7.764 billion (2019: RMB7.053 billion) of shares of 41.97 billion before the
implementation of the profit distribution plan.
Note 4: As stated in Note V. 43, according to the resolution of the General Meeting of Shareholders on May 25, 2020, the
Company’s payment of 2019 cash dividends to ordinary shareholders was one of the mandatory interest payment
events stipulated in the perpetual bond clauses of the 2020 three-phase medium-term notes (total RMB10,000,000
thousand), which required the Company to pay the dividends on the most recent perpetual bond interest date (the
first phase of the 2020 mid-term notes is 3 April 2021, the second phase of medium-term notes is 13 April 2021, and
the third phase of 2020 mid-term notes is 20 April 2021). In addition, on 6 March 2020, the Company exercised the
redemption right at the face value with the interest payable in accordance with the terms of the issuance, and fully
redeemed the perpetual bonds issued on 6 March 2018 with the amount of RMB6,000,000 thousand. Therefore,
the Company accrued a total dividend of RMB402,574 thousand on perpetual bonds during this year. In 2019, a
dividend of RMB870 million was accrued for preference shares and RMB432,795 thousand for perpetual bonds.

49. Revenue and cost of sales

2020 2019
revenue cost revenue cost
Revenue from main operations 1,612,040,788 1,438,096,664 1,415,382,493 1,259,224,958
Revenue from other operations 2,982,539 2,034,970 4,454,095 3,001,242
Total 1,615,023,327 1,440,131,634 1,419,836,588 1,262,226,200

Revenue is as follows:
2020 2019
Revenue from contracts with customers 1,614,075,217 1,419,187,334
Rentals 948,110 649,254
Total 1,615,023,327 1,419,836,588

Please refer to Note XIV. 1 for details of analysis of the Group’s revenue and cost of sales by industry and region.

Revenue is as follows:

2020

Infrastructure Real estate

Building construction development Prospecting
construction and and and
engineering investment investment design Others Total
Revenue from main operations 972,432,561 343,565,132 271,130,912 10,134,610 14,777,573 1,612,040,788
  Revenue recognised at a
– – 227,084,348 – 5,262,794 232,347,142
   point of time
  Revenue recognised over
972,432,561 343,565,132 44,046,564 10,134,610 9,514,779 1,379,693,646
  time
Revenue from other operations – – – – 2,982,539 2,982,539
Total 972,432,561 343,565,132 271,130,912 10,134,610 17,760,112 1,615,023,327

2019
Infrastructure Real estate
Building construction development Prospecting
construction and and and
engineering investment investment design Others Total
Revenue from main operations 854,153,349 318,085,139 216,942,909 9,854,917 16,346,179 1,415,382,493
  Revenue recognised at
– – 185,215,974 – 5,075,861 190,291,835
   a point of time
  Revenue recognised over
854,153,349 318,085,139 31,726,935 9,854,917 11,270,318 1,225,090,658
  time
Revenue from other operations – – – – 4,454,095 4,454,095
Total 854,153,349 318,085,139 216,942,909 9,854,917 20,800,274 1,419,836,588

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V. Notes to the consolidated financial statements (continued)

49. Revenue and cost of sales (continued)

As of 31 December 2020 and 31 December 2019, part of the Group’s project contracting business is still in the process of
operation, and the remaining performance obligations is related to the progress of the corresponding contract, and will be
recognised as revenue according to the progress of performance in the future performance period.

50. Taxes and surcharges

2020 2019
Land appreciation tax 10,521,977 12,322,394
Urban maintenance and construction tax 1,678,089 1,554,181
Educational surcharge 812,163 859,195
Business tax 46,616 16,090
Others 2,836,690 2,468,143
Total 15,895,535 17,220,003

51. Selling and distribution expenses

2020 2019
Operating expenses 2,030,299 1,207,133
Advertising and communication fees 1,906,692 1,856,860
Employee benefits 1,177,471 1,020,749
Others 407,804 246,084
Total 5,522,266 4,330,826

52. General and administrative expenses

2020 2019
Employee benefits 19,926,944 19,045,142
Office and travelling expenses 2,257,481 2,603,233
Lease expenses 2,062,966 1,780,282
Depreciation and amortisation 1,474,226 1,248,697
Service fees of specialist agency 679,043 666,342
Others 2,582,279 2,341,781
Total 28,982,939 27,685,477

53. Research and development expenses

2020 2019
Materials, fuels and power of consumption 15,428,519 11,224,721
Employee benefits 6,287,144 3,557,488
Maintenance and Lease expenses 1,417,447 820,064
Design and test fee 418,575 521,086
Travelling and meeting expenses 99,294 140,225
Others 1,871,567 1,026,355
Total 25,522,546 17,289,939

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V. Notes to the consolidated financial statements (continued)

54. Finance expenses

2020 2019
Interest expenses 23,420,560 21,721,127
Less: Interest income (3,760,919) (3,648,525)
Less: Capitalised amount of interest (10,997,250) (11,244,722)
Commission charges 1,668,385 1,362,685
Factoring Commission (2,651,274) (495,822)
Discounted long-term receivables/payables and others 118,197 216,968
Total 7,797,699 7,911,711

The Group capitalizes the borrowing costs incurred for the acquisition, construction or production of assets that meet
the capitalization conditions. The capitalized amount of borrowing costs in 2020 was RMB10,997,250 thousand (2019:
RMB11,244,722 thousand), which is included Inventory, construction in progress, and intangible assets.

55. Investment income

2020 2019
Long-term equity investment income under the equity method 5,918,135 4,673,782
Investment loss from disposal of financial assets measured at
(2,200,204) (2,330,684)
  amortized cost
Investment income from disposal of long-term equity investments 1,354,050 274,341
Investment income from disposal of financial assets measured at
4,793 48,743
  fair value through profit and loss
Investment income from financial assets held for trading 16,904 127,601
Investment income from debt investments 428,836 493,277
Dividend income from other equity instruments 156,146 270,650
Investment income from other debt investments 19,278 11,600
Income from stepped acquisition 133,746 248,249
Others 319,931 394,979
Total 6,151,615 4,212,538

56. Gains/(Losses) from changes in fair value

2020 2019
Financial assets held for trading
  Investment in debt instrument held for trading (6,516) 299,934
  Investment in equity instrument held for trading (2,915) (233,260)
Financial liabilities held for trading
 Others 60,204 (551,426)
Total 50,773 (484,752)

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V. Notes to the consolidated financial statements (continued)

57. Credit impairment losses

2020 2019
Impairment loss of accounts receivable (2,894,029) (669,843)
Impairment loss of other receivables (329,354) (413,847)
Impairment loss of long-term receivables (701,724) (388,458)
Others 583,583 (799,408)
Total (3,341,524) (2,271,556)

58. Asset impairment losses

2020 2019
Reversal of impairment loss of inventories (183,473) 190,180
Reversal of impairment loss of contract assets 184,892 (1,340,039)
Impairment loss of intangible assets (284,663) (89,713)
Impairment loss of goodwill (16,132) –
Impairment loss of other assets (29,106) (27,097)
Total (328,482) (1,266,669)

59. Non-operating income

Non-recurring
2020 2019 profit or loss in 2020
Accounts payable exemption 162,367 526,764 162,367
Government grants not related to the ordinary
110,094 137,067 110,094
  course of business
Liquidated damages 98,411 93,385 98,411
Gains on penalties and fines 63,800 38,403 63,800
Gains from damage and retirement of
23,914 15,736 23,914
  non-current assets
Others 350,588 482,677 350,588
Total 809,174 1,294,032 809,174

Details of government grants:

Related to
2020 2019 income/assets
Housing collection, compensation and
  resettlement fund of China Northeast
17,133 151 related to income
  Architectural Design and Research
  Institute Co., Ltd
Compensation of China Northwest Architectural
15,400 – related to income
  Design and Research Institute Co., Ltd
Compensation for land acquisition in
5,024 5,048 related to assets
  Fengrun District, Tangshan City
related to income
Others 72,537 131,868
and assets
Total 110,094 137,067

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V. Notes to the consolidated financial statements (continued)

60. Non-operating expenses

Non-recurring
2020 2019 profit or loss in 2020
Litigation Estimated Liabilities 471,289 2,752,695 471,289
Donations 60,551 32,864 60,551
Liquidated damages 47,727 47,088 47,727
Loss on damage and retirement of
46,543 66,369 46,543
  non-current assets
Late fees 44,663 31,848 44,663
Forfeiture loss 43,971 65,354 43,971
Others 285,686 625,054 285,686
Total 1,000,430 3,621,272 1,000,430

61. Expenses by nature

The supplemental information for the total amount of cost of sales, selling and distribution expenses, general and
administrative expenses, and research and development expenses which categorised by nature is as follows:
2020 2019
Subcontracting cost 422,366,022 371,839,766
Consumed raw materials 388,318,154 379,523,138
Labor expenditure 242,027,232 198,314,361
Changes in inventories of finished goods and work in progress 190,935,051 144,153,318
Other construction cost 131,568,562 104,928,003
Employee benefits 79,281,930 70,056,207
Cost of sales of other products 22,076,412 20,504,116
Depreciation and amortization expenses 8,887,715 9,047,392
Others 14,698,307 13,166,141
Total 1,500,159,385 1,311,532,442

62. Income tax expenses

2020 2019
Current tax 23,212,474 21,238,648
Deferred tax 127,751 (2,976,045)
Total 23,340,225 18,262,603

The reconciliation between income tax expenses and profit before income taxes is as follows:
2020 2019
Profit before income tax 94,290,605 81,467,846
Tax at the applicable tax rate (25%) 23,572,651 20,366,962
Effect of preferential tax rates for certain subsidiaries (2,106,251) (1,166,976)
Income not subjected to tax (2,858,911) (1,656,673)
Income tax benefits on research and development (1,525,517) (1,674,640)
Expenses not deductible for tax 3,824,000 1,547,740
Unrecognised deductible tax losses 1,547,760 1,800,250
Tax losses utilised from prior periods (375,797) (989,317)
Utilization of deductible losses for which no deferred tax assets was
(181,457) (1,043,424)
  recognised in prior years

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V. Notes to the consolidated financial statements (continued)

62. Income tax expenses (continued)

The reconciliation between income tax expenses and profit before income taxes is as follows: (continued)

2020 2019
Taxable temporary differences for which no deferred tax assets was
1,265,698 1,456,571
  recognised in current year
Deductible temporary differences resulting from rehearsal or
  recognition of previously unrecognised deferred tax assets in (331,548) (405,638)
  current year
Taxable temporary differences for which no deferred tax liability was
(40,888) (13,884)
  recognised in current year
Adjustments of tax expenses for prior year 550,485 41,632
Tax expenses at the Group’s effective tax rate 23,340,225 18,262,603

63. Earnings per share

2020 2019
RMB/share RMB/share
Basic earnings per share
Continuing operations 1.07 0.97
Diluted earnings per share
Continuing operations 1.07 0.96

The basic earnings per share is calculated based on the net profit for the year attributable to ordinary shareholders of the
Company and the weighted average number of outstanding ordinary shares during the year.

The numerator of the diluted earnings per share is determined based on the current net profit attributable to ordinary
shareholders of the Company after adjusting the following factors: (1) the interest of the diluted potential ordinary shares
that have been recognised as expenses in the current period; (2) the income or expenses of dilution potential ordinary that
will be generated when the shares are converted; and (3) the income tax impact related to the above adjustments.

The denominator of the diluted earnings per share is equal to the sum of the following two items: (1) the weighted average
number of issued ordinary shares of the parent company in the basic earnings per share; and (2) the increase of the
weighted average number of ordinary shares, assuming the conversion of dilutive potential ordinary shares into ordinary
shares.

When calculating the weighted average of the number of ordinary shares increased by the conversion of diluted potential
ordinary shares into issued ordinary shares, the diluted potential ordinary shares issued in the previous period are
assumed to be converted at the beginning of the current period; the current diluted potential ordinary shares issued,
assuming the conversion on the issue date.

The calculation of basic earnings per share is as follows:

2020 2019
Revenue
  Net profit attributable to ordinary shareholders of the Company 44,944,250 41,881,399
  Less: The effect of other equity instruments dividends (Note 1) (402,574) (1,302,795)
     The effect of restricted shares (Note 2) (348,566) (685,765)
44,193,110 39,892,839
Shares
  Weighted average number of ordinary shares outstanding
41,152,199 41,175,428
   (in units of 1000 shares) (Note 3)
Basic earnings per share (RMB/share) 1.07 0.97

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V. Notes to the consolidated financial statements (continued)

63. Earnings per share (continued)

The calculation of basic earnings per share is as follows: (continued)
Note 1: In accordance with the relevant clauses and regulations of preference shares and perpetual bonds as stated in Note
V. 43, in calculating the basic earnings per share, the dividends of other equity instruments included in the net profit
attributable to shareholders of the parent company is deducted. The accrued dividends of perpetual bonds with a
value date of 7 March 2018 amounted to RMB82 million in 2020, The accrued dividends of perpetual bonds with a
value date of 3 April 2020 amounted to RMB132 million in 2020, The accrued dividends of perpetual bonds with a
value date of 13 April 2020 amounted to RMB93 million in 2020, The accrued dividends of perpetual bonds with a
value date of 20 April 2020 amounted to RMB96 million in 2020, The above was RMB403 million in total.
Note 2: As stated in Note XI, the Company has completed the granting of restricted shares to the incentive targets in
accordance with the second batch incentive plans on 29 December 2016, and the granting of the third batch
of restricted shares to the third batch incentive targets in accordance with the third batch incentive plan on 26
December 2018. In accordance with the relevant stipulations in Explanation of Accounting Standards for Business
Enterprises No. 7 issued by the Ministry of Finance in 2015, the Company deducted net profits attributable to
restricted shares, which are expected to be unlocked in the future from net profits attributable to shareholders of
the Company in calculating the basic earnings per share. The net profits attributable to restricted shares which are
expected to be unlocked in the future was about RMB349 million and RMB686 million in 2020 and 2019 respectively.
Note 3: As stated in Note XI, in accordance with the regulations of the third batch incentive plans and the second batch
incentive plan, whether the unlocked shares granted could be listed and circulated depended on whether the
restricted shares met the unlocking conditions at the unlocking date. Therefore, the impacted amount of the
restricted shares not yet meeting the unlocking conditions and those invalid restricted shares were deducted from
weighted average number of outstanding ordinary shares in calculating the basic earnings per share.
The calculation of diluted earnings per share is as follows:
2020 2019
Consolidated net profit attributable to ordinary shareholders of the
44,057,292 39,329,822
  Company used for calculating diluted earnings per share
Weighted average number of ordinary shares outstanding used for
41,152,199 41,175,428
  calculating diluted earnings per share (in units of 1000 shares)
Diluted earnings per share (RMB/share) 1.07 0.96

In 2020, the restricted shares outstanding and the share options issued by the Company’s subsidiary China Overseas
Holdings Limited have no dilutive effects in calculating the earnings per share. However, the convertible bond issued by
the Company’s subsidiary China Overseas Holdings Limited has dilutive effects on consolidated net profit attributable to
ordinary shareholders of the Company.

64. Notes to the consolidated cash flow statement

2020 2019
Cash received relating to other operating activities
  Interest income 1,506,170 3,554,856
  Deposits and warrant received and returned 3,331,135 5,635,528
  Deposits absorbed by China State Construction Finance Co. Ltd 1,337,257 –
  Other receivables received and returned 904,844 1,045,775
  Receivables, taxes withheld and construction reward 7,293,641 7,879,399
 Others 2,032,425 1,254,039
Total 16,405,472 19,369,597
Cash payment relating to other operating activities
  Deposits and warrant paid and refunded 5,072,124 4,937,665
  Other payables paid 9,837,178 12,656,312
  Restricted cash 2,336,332 1,387,681
  Deposits repaid by Finance Co. – 382,930
 Others 9,805,454 10,421,396
Total 27,051,088 29,785,984

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V. Notes to the consolidated financial statements (continued)

64. Notes to the consolidated cash flow statement (continued)

2020 2019
Cash received relating to other investing activities
  Repayment of loans from related parties 9,382,895 10,741,001
  Repayment of loans from co-operative corporation and projects 3,751,504 3,333,198
  Entrusted loan 2,790,910 1,679,700
 Others 4,734 481,403
Total 15,930,043 16,235,302
  Cash payment relating to other investing activities
  Loans to related parties 8,754,096 15,736,313
  Payment to co-operative corporation and projects 3,256,911 3,812,586
Others 4,945,668 835,449
Total 16,956,675 20,384,348
Cash received relating to other financing activities
  Received from financing 14,260,156 10,533,485
Cash payments relating to other financing activities
  Repayment of loans 37,214,581 13,744,825
  Lease fee for fixed assets held under finance leases 234,724 244,053
 Others 69,861 34,956
Total 37,519,166 14,023,834

65. Supplementary information to the consolidated cash flow statement

(1) Supplementary information to the consolidated cash flow statement

Reconciliation from net profit to cash flows from operating activities:
2020 2019
Net profit 70,950,380 63,205,243
Add: Impairment allowance 328,482 1,266,669
Credit impairment losses 3,341,524 2,271,556
Depreciation of fixed assets 6,071,485 6,543,253
Depreciation of investment properties 2,042,319 1,718,108
Amortisation of intangible assets 476,611 447,821
Amortisation of long-term prepaid expenses 297,300 338,210
Profit from disposal of fixed assets, intangible assets and other
98,763 (568,141)
  long-term assets
(Gains)/Losses from changes in fair value (50,773) 484,752
Finance expenses 7,986,276 10,179,757
Investment income (6,151,615) (4,212,538)
Increase in deferred tax assets (995,618) (3,083,170)
Increase in deferred tax liabilities 1,123,369 107,125
Increase in inventories (88,311,859) (70,420,830)
Decrease in restricted cash (2,336,332) (1,387,681)
Increase in operating receivables (44,483,262) (125,133,902)
Increase in operating payables 69,837,441 83,217,173
Others 47,290 806,518
Net cash flows used in operating activities 20,271,781 (34,220,077)

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V. Notes to the consolidated financial statements (continued)

65. Supplementary information to the consolidated cash flow statement (continued)

(1) Supplementary information to the consolidated cash flow statement (continued)

Reconciliation from net profit to cash flows from operating activities: (continued)

Changes in cash and cash equivalents:

2020 2019
Closing balance of cash 267,861,580 271,727,808
Less: Opening balance of cash 271,727,808 298,810,194
Net decrease in cash and cash equivalents (3,866,228) (27,082,386)

(2) Cash and cash equivalents

31 December 2020 31 December 2019
Cash 267,861,580 271,727,808
  Including: Cash on hand 132,591 143,503
       Cash at bank that can be readily drawn on demand 266,847,584 270,689,033
       Other cash that can be readily drawn on demand 881,405 895,272
       Cash and cash equivalents at the end of the year 267,861,580 271,727,808

66. Assets with restricted ownership

31 December 2020 31 December 2019

Cash and bank balances 21,310,994 18,974,662 Note 1
Notes receivable 2,028,537 689,065 Note 2
Accounts receivable 292,907 86,887 Note 2
Inventories 35,753,943 36,139,758 Note 2
Contract assets 19,816,568 14,641,856 Note 2
Investment properties 8,510,788 7,697,570 Note 2
Fixed assets 279,032 414,471 Note 2
Construction in progress 1,334,754 67,721 Note 2
Intangible assets 6,005,584 6,565,280 Note 2
Long-term receivables 73,822,238 76,972,065 Note 2
Total 169,155,345 162,249,335

Note 1: Cash and bank balances with restricted ownership or use rights mainly include central bank reserves, bank
acceptance bill deposits, guarantee deposits, real estate pre-sale supervision funds, mortgage deposits and etc.
As of 31 December 2020, the balance of restricted cash and bank balances was RMB21,310,994 thousand (31
December 2019: RMB18,974,662 thousand).

Note 2: At 31 December 2020 and 31 December 2019, the Group pledged or mortgaged notes receivable, accounts
receivable, inventories, contract assets, investment properties, fixed assets, construction in progress, intangible
assets and long-term receivables to banks for borrowings.

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V. Notes to the consolidated financial statements (continued)

67. The foreign currency monetary items

31 December 2020 31 December 2019

Amount Amount
in foreign Exchange Amount in foreign Exchange Amount
currency rate in RMB currency rate in RMB
Cash and Bank balance
USD 2,260,783 6.5249 14,751,383 2,318,654 6.9762 16,175,394
HKD 10,565,201 0.8416 8,891,673 12,984,933 0.8958 11,631,903
MOP 2,009,855 0.8175 1,643,056 2,922,876 0.8679 2,536,764
EUR 224,311 8.0250 1,800,096 183,766 7.8155 1,436,223
DZD 30,868,277 0.0494 1,524,893 24,116,528 0.0584 1,408,405
SGD 275,741 4.9314 1,359,789 309,672 5.1739 1,602,212
GBP 25,270 8.8903 224,658 81,994 9.1501 750,253
Others N/A N/A 3,437,673 N/A N/A 2,466,833
Total 33,633,221 38,007,987
Accounts receivable
HKD 12,167,109 0.8416 10,239,839 6,697,119 0.8958 5,999,279
USD 719,277 6.5249 4,693,210 771,435 6.9762 5,381,685
XAF 73,636,060 0.0122 898,360 83,793,654 0.0119 997,144
DZD 15,563,398 0.0494 768,832 18,582,764 0.0584 1,085,233
SGD 78,324 4.9314 386,247 82,983 5.1739 429,346
AED 632,509 1.7761 1,123,399 785,020 1.8992 1,490,910
Others N/A N/A 2,417,030 N/A N/A 2,076,508
Total 20,526,917 17,460,105
Other receivables
USD 97,000 6.5249 632,915 171,323 6.9762 1,195,184
HKD 564,804 0.8416 475,339 796,889 0.8958 713,853
XAF 1,197,401 0.0122 14,608 20,943,287 0.0119 249,225
Others N/A N/A 1,577,895 N/A N/A 954,598
Total 2,700,757 3,112,860
Current portion of non-current assets
HKD 909,125 0.8416 765,120 371,272 0.8958 332,585
USD 56,283 6.5249 367,241 18,301 6.9762 127,671
THB 27,866 0.2179 6,072 174,309 0.2328 40,579
Others N/A N/A 318,940 N/A N/A 1,114,310
Total 1,457,373 1,615,145
Debt investments
HKD 10,470,438 0.8416 8,811,921 12,921,323 0.8958 11,574,921
EUR 2,634 8.0250 21,138 2,581 7.8155 20,172
Total 8,833,059 11,595,093

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V. Notes to the consolidated financial statements (continued)

67. The foreign currency monetary items (continued)

31 December 2020 31 December 2019

Amount Amount
in foreign Exchange Amount in foreign Exchange Amount
currency rate in RMB currency rate in RMB
Long-term receivables
HKD 528,501 0.8416 444,786 509,055 0.8958 456,011
XAF 14,389,504 0.0122 175,552 17,587,172 0.0119 209,287
USD 12,317 6.5249 80,367 15,838 6.9762 110,489
Others N/A N/A 1,394 N/A N/A 309
Total 702,099 776,096
Short-term borrowings
USD 282,856 6.5249 1,845,607 246,088 6.9762 1,716,759
Others N/A N/A 1,030,693 N/A N/A 526,836
Total 2,876,300 2,243,595
Accounts payable
USD 712,963 6.5249 4,652,012 809,830 6.9762 5,649,536
HKD 7,676,618 0.8416 6,460,642 3,967,954 0.8958 3,554,493
DZD 58,055,954 0.0494 2,867,964 62,018,571 0.0584 3,621,885
AED 1,889,796 1.7761 3,356,467 1,705,763 1.8992 3,239,585
SGD 364,128 4.9314 1,795,661 493,762 5.1739 2,554,675
MOP 1,596,727 0.8175 1,305,324 1,397,277 0.8679 1,212,697
PKR 1,573,517 0.0407 64,042 27,614,720 0.0450 1,242,662
Others N/A N/A 4,180,944 N/A N/A 3,498,864
Total 24,683,056 24,574,397
Other payables
USD 234,534 6.5249 1,530,311 234,984 6.9762 1,639,295
HKD 1,938,932 0.8416 1,631,805 128,706 0.8958 115,295
XAF 17,655,935 0.0122 215,402 18,048,594 0.0119 214,778
PKR 2,348,152 0.0407 95,570 2,307,212 0.0450 103,825
Others N/A N/A 4,571,074 N/A N/A 1,334,983
Total 8,044,162 3,408,176
Current portion of non-current liabilities
USD 836,374 6.5249 5,457,257 2,697,083 6.9762 18,815,390
HKD 6,869,303 0.8416 5,781,205 7,735,220 0.8958 6,929,210
Others N/A N/A 1,406,937 N/A N/A 937,477
Total 12,645,399 26,682,077
Long-term borrowings
HKD 95,025,457 0.8416 79,973,425 73,316,333 0.8958 65,676,771
USD 247,801 6.5249 1,616,877 1,049,607 6.9762 7,322,268

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V. Notes to the consolidated financial statements (continued)

67. The foreign currency monetary items (continued)

31 December 2020 31 December 2019

Amount Amount
in foreign Exchange Amount in foreign Exchange Amount
currency rate in RMB currency rate in RMB
GBP 200,133 8.8903 1,779,242 197,696 9.1501 1,808,938
SGD 47,493 4.9314 234,207 220,144 5.1739 1,139,003
Others N/A N/A 240,558 N/A N/A 243,801
Total 83,844,309 76,190,781
Bonds payable
USD 8,789,597 6.5249 57,351,241 7,617,936 6.9762 53,144,245
HKD 2,026,488 0.8416 1,705,492 3,448,985 0.8958 3,089,601
Total 59,056,733 56,233,846
Long-term payables
HKD 1,261,321 0.8416 1,061,528 913,734 0.8958 818,523
AED 503,614 1.7761 894,469 – – –
MOP 469,565 0.8175 383,869 395,453 0.8679 343,214
SGD 51,907 4.9314 255,974 56,668 5.1739 293,195
USD 1,540 6.5249 10,048 55,023 6.9762 383,851
Others N/A N/A 319,136 N/A N/A 999,759
Total 2,925,024 2,838,542
Other non-current liabilities
USD 671,606 6.5249 4,382,162 906,141 6.9762 6,321,423
Others N/A N/A 76,938 N/A N/A –
Total 4,459,100 6,321,423

VI. Changes of consolidation scope

1. The entities which were not significant to the Group were included in the consolidation scope through business
combination not under common control in 2020.

2. There was no entity newly included in the consolidation scope through business combination under common
control in 2020.

3. The entities which were excluded from the consolidated scope due to disposal of subsidiaries in 2020 were not
significant to the Group.

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VII. Interests in other entities

1. Interests in subsidiaries

Significant subsidiaries obtained through incorporation:

Main operation Place of Shareholding Percentage (%)

Location registration Nature of business Registered capital Direct Indirect
The significant subsidiaries acquired through establishing or
investment
China Overseas Holdings Limited Hong Kong Hong Kong Investment RMB31.03 billion 100.00 –
China Overseas Land & Investment Limited Hong Kong Hong Kong Real Estate Investment HKD10.95 billion – 56.00
and Development
China State Construction International Hong Kong Cayman Islands Construction and HKD15 billion – 64.66
Installation
China Overseas Property Holdings Ltd. Hong Kong Cayman Islands Property Management HKD0.03 billion – 61.18
China Construction First Group Corporation Limited Beijing Beijing Construction and RMB7 billion 100.00 –
Installation
China Construction Second Engineering Bureau Ltd. Beijing Beijing Construction and RMB5 billion 100.00 –
Installation
China Construction Third Engineering Bureau Co., Ltd. Wuhan, Hubei Wuhan, Hubei Construction and RMB5.04 billion 100.00 –
Installation
China Construction Fourth Engineering Division Corp., Ltd. Guangzhou, Guangzhou, Construction and RMB5.10 billion 100.00 –
Guangdong Guangdong Installation
China Construction Fifth Engineering Division Corp., Ltd. Changsha, Hunan Changsha, Hunan Construction and RMB6.018 billion 100.00 –
Installation
China Construction Sixth Engineering Division Corp., Ltd. Tianjin Tianjin Construction and RMB4.28 billion 100.00 –
Installation
China Construction Seventh Engineering Division. Corp., Ltd. Zhengzhou, Henan Zhengzhou, Henan Construction and RMB6 billion 100.00 –
Installation
China Construction Eighth Engineering Division. Corp., Ltd. Shanghai Shanghai Construction and RMB13.50 billion 100.00 –
Installation
China Construction Engineering Design Group Corporation Limited Beijing Beijing Engineering Prospecting RMB0.51 billion 100.00 –
and Design
China Construction Decoration Group Co., Ltd. Beijing Beijing Industrial Decoration RMB1 billion 50.00 50.00
China Construction Fangcheng Investment & Development Group Beijing Beijing Infrastructure Construction RMB5 billion 100.00 –
Co., Ltd.
The significant subsidiaries acquired through a business
combination not involving under common control
China State Construction Development Holdings Limited (Note) Hong Kong Cayman Islands Construction and HKD0.1 billion – 47.89
Installation
China State Construction Harbour Construction Co., Ltd. Shanghai Shanghai Infrastructure Construction RMB1.33 billion 70.00 –
Tuxiana Corp. Wanning, Hainan The British Virgin Real Estate Development USD1 – 55.99
Islands and Investment
CITIC Real Estate Group Co., Ltd. Beijing Beijing Real Estate Development RMB10.49 billion – 55.99
and Investment
The significant subsidiaries acquired through a business
combination involving entities under common control
CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. Wulumuqi, Xinjiang Wulumuqi, Xinjiang Construction and RMB3.50 billion 85.00 –
Installation
China West Construction Group Co., Ltd. Chengdu, Sichuan Wulumuqi, Xinjiang Construction Materials RMB1.26 billion 12.29 45.50
Shenzhen China Overseas Investing Management Co., Ltd. Hong Kong Shenzhen, Real Estate Development RMB2.65 billion 100.00 –
Guangdong and Operation
China State Construction Finance Co., Ltd. Beijing Beijing Finance RMB10 billion 80.00 –

Note: The Group holds 47.89% of shares of Far East Global Group Ltd. The board of directors has the rights to determine the relevant
activities of Far East Global Group Ltd. The Group holds 74.06% of voting rights of Far East Global Group Ltd. according to the proportion of
the board of directors.

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VII. Interests in other entities (continued)

1. Interests in subsidiaries (continued)

Significant subsidiaries involving non-controlling interest:

2020
Dividend
Shareholding of attributable to the
Non-controlling Non-controlling non-controlling Non-controlling
Interest Interest shareholders Interest
China Overseas Land & Investment Ltd. 44.00% 17,931,523 5,045,049 128,003,879
China State Construction International 35.34% 3,169,849 826,143 21,128,649
West Construction Co., Ltd. 42.21% 331,022 40,239 3,304,528
China State Construction Finance
  Co., Ltd. 20.00% 120,575 40,516 2,483,080

2019
Dividend
Shareholding of attributable to the
Non-controlling Non-controlling non-controlling Non-controlling
Interest Interest shareholders Interest
China Overseas Land & Investment Ltd. 44.01% 14,600,500 4,340,968 111,952,036
China State Construction International 35.34% 1,870,723 665,621 19,746,804
West Construction 42.21% 278,903 33,143 3,020,243
China State Construction Finance
  Co., Ltd. 20.00% 91,456 – 1,603,021

The summarised financial information of the above subsidiaries which progress necessary adjustments in accordance with
the company’s accounting policies is set out below. The amounts disclosed are before inter-company eliminations:
China China State
Overseas Land China State Construction
& Investment Construction West Finance Co.,
Ltd. International Construction Ltd
2020
Current Assets 631,691,450 74,517,932 20,484,986 49,508,084
Non-current Assets 124,340,915 78,955,851 3,348,630 62,248,763
Total Assets 756,032,365 153,473,783 23,833,616 111,756,847
Current Liabilities 300,167,208 65,093,611 13,726,379 99,341,446
Non-current Liabilities 180,347,534 42,765,015 50,802 –
Total Liabilities 480,514,742 107,858,626 13,777,181 99,341,446
Revenue 187,012,838 55,568,034 23,423,096 2,640,190
Net Profit 36,880,626 5,131,456 945,990 602,877
Total Comprehensive Income 36,564,040 7,469,599 943,287 602,877
Cash flow from/(used in) operating activities 9,697,382 (3,824,677) 633,114 (7,773,500)

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VII. Interests in other entities (continued)

1. Interests in subsidiaries (continued)

Significant subsidiaries involving non-controlling interest (continued):

The summarised financial information of the above subsidiaries which progress necessary adjustments in accordance
with the company’s accounting policies is set out below. The amounts disclosed are before inter-company eliminations
(continued):

China China State

Overseas Land China State Construction
& Investment Construction West Finance Co.,
Ltd. International Construction Ltd.
2019
Current Assets 549,735,090 67,631,068 19,109,898 53,488,354
Non-current Assets 118,679,866 72,894,203 3,324,746 42,446,849
Total Assets 668,414,956 140,525,271 22,434,644 95,935,203
Current Liabilities 258,248,215 63,672,863 12,460,089 87,920,100
Non-current Liabilities 164,162,438 35,208,338 751,557 –
Total Liabilities 422,410,653 98,881,201 13,211,646 87,920,100
Revenue 165,180,936 54,375,087 22,896,385 2,082,544
Net Profit 33,945,880 5,035,112 733,573 457,279
Total Comprehensive Income 33,988,546 4,745,444 736,669 457,279
Cash flow from/(used in) operating activities 9,898,481 (2,381,444) 2,063,989 (15,525,192)

Perpetual bonds of subsidiaries are as follows:

As of 31 December 2020, the balance of perpetual bonds and renewable loans issued by Company’s subsidiaries
(hereinafter collectively referred to as the “subsidiary perpetual bonds”) amounted to RMB76,740,046 thousand(31 December
2019:RMB52,869,875 thousand). The perpetual bonds of these subsidiaries exist for a long time, and the subsidiaries of the
Company can decide whether to redeem and repay them. Unless there is a compulsory interest payment event that can be
determined and controlled to occur by the Company’s subsidiary, on each interest payment date, the Company’s subsidiaries
can choose to postpone the current interest and all deferred interest to the next interest payment date and is not subject
to any restrictions on the number of deferred interest payments. The Group accounted for these perpetual bonds as non-
controlling shareholders’ equity.

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VII. Interests in other entities (continued)

1. Interests in subsidiaries (continued)

Debt-to-equity swaps of subsidiaries are as follows:

In December 2019, some of the Company’s subsidiaries entered into capital increase agreements and shareholder
agreements with a number of third-party investors. In accordance with the Capital Increase Agreement and the
Shareholder Agreement (collectively referred to as the “Agreement”), third-party investors increase their capital in cash
to the subsidiaries of such subsidiaries (hereinafter referred to as “the underlying company”), and upon completion of
the capital increase, the shareholding of the Company’s subsidiaries in the underlying company decreases, but there
is no loss of control over the underlying company. The agreement stipulates that the profit distribution of the underlying
company shall be determined by the shareholders’ meeting, that the exit method of the third-party investor shall be agreed
with the controlling shareholder of the target company, and that the controlling shareholder of the target company shall
have the right to acquire or designate other parties to acquire the shares of the target company held by the third party
investor after the expiration of a certain period (“investment period”) from the date of payment of the investment price. In
the event of a specific situation or the expiry of the investment period of the underlying company, a third-party investor may
make a request to the subsidiary of the Company to acquire the shares of the underlying company held by the Company’s
subsidiaries, and if the subsidiary of the Company does not choose to acquire such shares, the annual expected dividend
ratio will up to until the agreed upper limit of the dividend ratio. However, if the shareholders of the underlying company
will not pay dividends it do not constitute a breach of contract; A third party investor can transfer all or part of its equity
interest in the underlying company to any third part or increase the voting rights of third-party investors in the shareholders’
meeting or board of directors of the underlying company in order to achieve the joint control of the underlying company
with the Company’s subsidiaries. The above-mentioned arrangement does not constitute a contractual obligation of the
Company or its subsidiaries to deliver cash or other financial assets to other parties or to exchange financial assets or
financial liabilities with other parties under potential adverse conditions, and the Company shall therefore account for
such capital increases as the equity of the underlying company. As of 31 December, 2019, third-party investors increased
their capital in the underlying company totalling RMB15,600,000 thousand. These transactions resulted in an increase of
RMB15,606,801 thousand in non-controlling shareholders’ equity in the Group’s consolidated financial statements as at 31
December 2019.

In 2020, third-party investors paid in capital of RMB7,200,000 thousand in total to the underlying company. The relevant
clauses in the Capital Increase Agreement and Shareholders Agreement this year are consistent with the above clauses.
This year these transactions resulted in an increase in non-controlling shareholders’ equity in the Group’s consolidated
financial statements of RMB7,200,458 thousand as at 31 December 2020.

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VII. Interests in other entities (continued)

2. Interests in joint ventures and associates

Main operation Place of Registered Percentage of Shares(%) Accounting

location registration Nature of business capital Direct Indirect treatment
Associates
Real Estate Investment
Overseas Oceans Hong Kong Hong Kong 5,579,100 – 38.32 Equity method
  and Development

The summarised financial information in respect of Overseas Oceans adjusted for any differences in accounting policies
and reconciled to the carrying amount in the financial statements is as follows:
31 December 2020 31 December 2019
Current Assets 160,985,732 128,355,460
  Including: Cash and cash equivalents 20,543,265 16,755,435
Non-current Assets 6,427,765 5,741,814
Total Assets 167,413,497 134,097,274
Current Liabilities 110,189,045 90,557,019
Non-current Liabilities 29,988,070 22,026,947
Total Liabilities 140,177,115 112,583,966
Non-controlling Interests 3,103,157 1,967,981
Attributable to shareholders of the Company 24,133,225 19,545,327
Net assets calculated by the percentage of shares holding 9,247,852 7,489,769
Book value of investment 9,247,852 7,489,769
The fair value of investment in associated companies
  that have publicly quoted prices 4,617,437 6,258,273

2020 2019
Revenue 42,909,060 28,590,883
Income tax expenses (4,935,694) (4,798,611)
Net Profit 4,604,141 3,496,961
Other Comprehensive Income 1,035,288 (302,751)
Total Comprehensive Income 5,639,429 3,194,210
Dividends received 309,427 196,548

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VII. Interests in other entities (continued)

2. Interests in joint ventures and associates (continued)

A summary of financial information of the joint ventures and Associates that are not individually material to the Group is as
follows:
For the year ended 31 For the year ended 31
December 2020 December 2019
Joint Ventures
Total book value of investment 39,626,372 34,354,496
Subtotals by the percentage of share holding
  Net Profit (Note 1) 2,750,015 1,783,311
  Other Comprehensive Income/ (loss) (Note 1) (67,093) 33,006
  Total Comprehensive Income 2,682,922 1,816,317
Associates
Total book value of investment 37,564,837 33,072,636
Subtotals by the percentage of share holding
  Net Profit (Note 1) 1,491,710 1,614,537
  Other Comprehensive loss (Note 1) (7,321) (221,352)
  Total Comprehensive Income 1,484,389 1,393,185

Note 1: Both the net profit and other comprehensive income have considered the fair value of the identifiable assets and
liabilities at the time the investment is obtained and the adjustment effects of the unified accounting policy.

3. Interests in consolidated structured entities

As at 31 December 2020, the main consolidated structured entities which set up by the Group’s subsidiary China State
Construction Fund Management Ltd. amounted to RMB 12,378,963 thousand, and the Group’s subscribed amount is RMB
4,576,093 thousand. As at 31 December 2020, the Group’s paid-in amount is RMB 4,318,740 thousand and other parties
is RMB 6,907,808 thousand. The Group classified other parties’ paid-in amount as non-controlling interests. The Group has
no obligation and intention to provide financial supporting to these structured entities.

4. Interests in non-consolidated structured entities

As at 31 December 2020, the non-consolidated structured entities China State Construction Fund Management Ltd.
participated in is amounted to RMB 35,294,455 thousand, and the Group’s subscribed amount is RMB 7,052,680 thousand
and other parties is RMB 28,241,775 thousand. The Group has no control power over these special purpose vehicles, thus
The Group cannot consolidate them. As at 31 December 2020, the Group’s paid-in amount is RMB 4,955,869 thousand
and classified as long-term equity investments. The largest risk exposure of the Group is the paid-in amount as at the
balance sheet date. The Group has no obligation and intention to provide financial supporting to these structured entities.

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VIII. Financial instruments and related risks

1. Financial instruments by category

Carrying amounts of each category of financial instruments at the balance sheet date are as follows:

31 December 2020

Financial assets
Financial assets at Financial assets at fair value
fair value through through other
profit or loss Financial comprehensive income
Required by the assets at Required by
standard amortised cost the standard Designated Total
Cash and bank balances – 295,857,190 – – 295,857,190
Financial assets held for trading 244,459 – – – 244,459
Notes receivable – 31,989,282 – – 31,989,282
Accounts receivable – 160,441,814 – – 160,441,814
Accounts receivable financing – – 3,788,082 – 3,788,082
Other receivables – 54,626,721 – – 54,626,721
Current portion of non-current
– 37,815,606 182,608 – 37,998,214
 assets
Other current assets – 18,592,319 – 2,906,177 21,498,496
Debt investments – 14,605,329 – – 14,605,329
Other debt investments – – 356,377 – 356,377
Long-term receivables – 177,642,042 – – 177,642,042
Investments in other equity
– – – 5,838,384 5,838,384
 instruments
Other non-current financial assets 335,510 – – – 335,510
Total 579,969 791,570,303 4,327,067 8,744,561 805,221,900

Financial liabilities
Financial liabilities at
fair value through
profit or loss
Required by Financial liabilities
the standard at amortised cost Total
Short-term loans – 29,317,096 29,317,096
Notes payable – 5,265,592 5,265,592
Accounts payable – 502,386,965 502,386,965
Other payables – 118,273,242 118,273,242
Current portion of non-current liabilities – 87,696,178 87,696,178
Other current liabilities – 2,313,213 2,313,213
Long-term borrowings – 292,897,038 292,897,038
Bonds payable – 88,782,471 88,782,471
Long-term payables – 17,500,260 17,500,260
Other non-current liabilities 4,421,322 1,520,302 5,941,624
Total 4,421,322 1,145,952,357 1,150,373,679

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VIII. Financial instruments and related risks (continued)

1. Financial instruments by category (continued)

Carrying amounts of each category of financial instruments at the balance sheet date are as follows: (continued)

31 December 2019

Financial assets

Financial assets at Financial assets at fair value

fair value through through other
profit or loss Financial comprehensive income
Required by the assets at Required by the
standard amortised cost standard Designated Total
Cash and bank balances – 292,441,419 – – 292,441,419
Financial assets held for trading 902,072 – – – 902,072
Notes receivable – 26,918,443 – – 26,918,443
Accounts receivable – 153,961,875 – – 153,961,875
Accounts receivable financing – – 3,674,166 – 3,674,166
Other receivables – 53,186,521 – – 53,186,521
Current portion of non-current assets – 32,739,429 – – 32,739,429
Other current assets – 20,764,581 – 3,557,504 24,322,085
Debt investments – 17,759,804 – – 17,759,804
Other debt investments – – 612,106 – 612,106
Long-term receivables – 164,825,662 – – 164,825,662
Investments in other equity instruments – – – 8,069,043 8,069,043
Other non-current financial assets 50,510 – – – 50,510
Total 952,582 762,597,734 4,286,272 11,626,547 779,463,135

Financial liabilities
Financial liabilities at
fair value through
profit or loss
Required by Financial liabilities
the standard at amortised cost Total
Short-term loans – 28,498,331 28,498,331
Notes payable – 7,030,414 7,030,414
Accounts payable – 493,129,630 493,129,630
Other payables – 114,030,641 114,030,641
Current portion of non-current liabilities 6,939,864 82,010,554 88,950,418
Other current liabilities – 975,956 975,956
Long-term borrowings – 247,800,428 247,800,428
Bonds payable – 99,596,598 99,596,598
Long-term payables – 19,897,230 19,897,230
Other non-current liabilities 4,695,968 1,625,455 6,321,423
Total 11,635,832 1,094,595,237 1,106,231,069

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VIII. Financial instrument and risk (continued) the financial instruments, and the risk management
strategies adopted by the Group to reduce these risks
2. Transfer of financial assets are as follows.

The Board of Directors is responsible for planning and

Tra n s fe r re d fi n a n c i a l a s s e t s t h a t a re n o t establishing the Group’s risk management structure,
derecognised in their entirety formulating the Group’s risk management policies and
As at 31 December 2020, the book value of bank related guidelines, and supervising the implementation
acceptance and commercial acceptance bills of risk management measures. The Group has
approved and discounted by the Group was RMB formulated risk management policies to identify and
15,512,784 thousand (31 December 2019: RMB analyze the risks faced by the Group. These risk
8,720,704 thousand). In the view of the Group, the management policies specify specific risks, covering
Group retains almost all of its risks and remuneration, market risk, credit risk and liquidity risk management.
including the risk of default associated with it, and The Group regularly assesses changes in the market
therefore continues to fully recognise it and the settled environment and the Group’s operating activities to
accounts payable or short-term borrowings associated decide whether to update the risk management policies
with it. After endorsement or discount, the Group no and systems. The risk management of the Group is
longer reserves the right to use it, including the right to carried out by the Risk Management Committee in
sell, transfer or pledge it to other third parties. As of 31 accordance with the policies approved by the Board of
December 2020, the Group’s book value of its settled Directors. The Risk Management Committee identifies,
accounts payable or short-term borrowings received evaluates and avoids related risks through close
totalled RMB 15,512,784 thousand (31 December cooperation with other business departments of the
2019: RMB 8,720,704 thousand). Group. The internal audit department of the Group
conducts regular audits on risk management controls
Transferred financial assets that are derecognised in and procedures, and reports the audit results to the
their entirety in which continuing involvement exists audit committee of the Group.

As of 31 December 2020, the book value of the The Group diversifies the risk of financial instruments
Group’s endorsed and discounted but not yet due through appropriate diversified investment and
bank acceptance bill was RMB 1,883,153 thousand business portfolios, and formulates corresponding
(31 December 2019: RMB 796,241 thousand). On 31 risk management policies to reduce the risk of
December 2020, its maturity date is 1 to 12 months. concentration in any single industry, specific region or
According to the relevant provisions of the “Negotiable specific counterparty.
Instruments Law”, if the acceptance bank refuses
to pay, its holder has the right to claim against the Credit risk
group (“continue involvement”). The Group believes The Group trades only with recognised and
that the group has transferred almost all of its risks creditworthy customers. It is the Group’s policy that
and rewards, therefore, the book value of its and all customers who wish to trade on credit terms are
related settled accounts payable is derecognised. subject to credit verification procedures. In addition,
The maximum loss and undiscounted cash flow of receivable balances are monitored on an ongoing basis
continued involvement and repurchase is equal to its to ensure that the Group’s exposure to bad debts is not
book value. The Group believes that the continued significant. For transactions that are not denominated
involvement in fair value is not significant. in the functional currency of the relevant operating
During the year ended 31 December, 2020, the Group unit, the Group does not offer credit terms without the
did not recognise gains or losses on the transfer date. specific approval of the Department of Credit Control in
There was no income or expenses recognised in the the Group.
current year and accumulatively due to the Group’s Since the counterparties of monetary funds, bank
continued involvement in the derecognized financial acceptance bills receivable are banks with good
assets. reputations and high credit ratings, these financial
instruments have low credit risks.
3. Financial instrument risks
Other financial assets of the Group include notes
The Group’s activities expose it to a variety of financial receivable, accounts receivable, other receivables,
risks: mainly include credit risk, liquidity risk and market debt investments, other debt investments, other equity
risk (including interest rate risk, currency risk and equity instrument investments, and other non-current financial
instrument price risk). The Group’s financial instrument assets. The credit risk of these financial assets stems
mainly includes cash and bank balances, equity from the default of the counterparty. The maximum
investments, debt investments, loans, bills receivable risk exposure is equal to the book value of these
and accounts receivable, receivables financing, bills instruments.
payable and accounts payable. The risks related to

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VIII. Financial instrument and risk (continued) Definition of credit-impaired assets

In order to determine whether credit impairment has

3. Financial instrument risks (continued) occurred, the standard used by the Group is consistent
with the internal credit risk management objectives
Credit risk (continued) for relevant financial instruments, while considering
The maximum credit risk exposure that the Group quantitative and qualitative indicators. The main
faces on each balance sheet date is the total amount consideration when the Group assesses whether a
collected from customers minus the amount of debtor has credit impairment the following factors:
impairment allowances. (1) The issuer or debtor has major financial
The Group also faces credit risks due to the provision difficulties;
of financial guarantees, as disclosed in Note XII 3 for (2) The debtor breached the contract, such as
details. defaulting or overdue payment of interest or
Since the Group only conducts transactions with principal;
recognised and reputable third parties, there is no need (3) The creditor, out of economic or contractual
for collateral. Credit risk is centralized and managed considerations related to the debtor’s financial
according to customers/counterparties, geographic difficulties, gives the debtor a concession that
regions and industries. Because the Group’s accounts the debtor would not make under any other
receivable customer base is relatively wide. Therefore, circumstances;
there is no significant concentration of credit risk within
the Group. (4) The debtor is likely to go bankrupt or undergo
other financial restructuring;
The judgment criteria for the significant increase of
(5) The issuer or debtor’s financial difficulties
credit risk
caused the disappearance of the active market
The Group evaluates on each balance sheet date for the financial asset;
whether the credit risk of relevant financial instruments
(6) A financial asset is purchased or originated at
has increased significantly since the initial recognition.
a significant discount, and the discount reflects
When determining whether the credit risk has
the fact that credit losses have occurred.
increased significantly since the initial recognition,
the Group considers whether it is necessary to pay The credit impairment of financial assets may be
unnecessary additional costs or efforts can be made caused by a combination of multiple events, and may
to obtain reasonable and based information, including not be caused by a separately identifiable event.
qualitative and quantitative analysis based on the
historical data of the Group, external credit risk ratings, Expected credit loss measurement parameters
and forward-looking information. Based on a single
Based on whether the credit risk has increased
financial instrument or a combination of financial
significantly and whether the financial asset has been
instruments with similar credit risk characteristics, the
credit-impaired, the Group measures the provision for
Group determines the change in the risk of default
impairment of different assets based on the 12-month
during the expected life of the financial instrument by
ECLs or the lifetime ECLs. The key parameters
comparing the risk of default on the balance sheet date
for expected credit loss measurement include the
of the financial instrument with the risk of default on the
probability of default, loss given default and default
initial recognition date.
risk exposure. The Group establishes the model of
When one or more of the following quantitative probability of default, loss given default and default risk
and qualitative standards are triggered, the Group exposure based on statistics of historical data (such
believes that the credit risk of financial instruments has as the counterparty’s rating, guarantee method and
increased significantly: type of pledges, repayment method, etc.) and forward-
looking information.
(1) The quantitative standard is mainly that the
probability of default in the remaining lifetime of
the reporting day has increased by more than
a certain percentage compared with the initial
confirmation;

(2) The qualitative standards are mainly the major

adverse changes in the debtor’s business
or financial situation, the list of early warning
customers, etc.

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VIII. Financial instrument and risk (continued)

3. Financial instrument risks (continued)

Credit risk (continued)

Expected credit loss measurement parameters (continued)

The relevant definitions are as follows:

(1) The probability of default refers to the possibility that the debtor will not be able to satisfy its repayment obligations
in the next 12 months or throughout the remaining lifetime. The probability of default of the Group is adjusted
against the results of the credit loss model as well as the forward-looking information, to reflect the probability of
default of the debtor in the current macroeconomic environment.

(2) The loss given default is the Group’s expectation on the extent of loss of default risk exposure. The loss given
default varies by the types of counterparties, the manner and priority of recourse, and the collateral. The loss given
default is the percentage of exposure loss at the time of default and is calculated over 12 months or lifetime; and

(3) The default risk exposure is the amount payable to the Group at the time of default over the next 12 months or
lifetime.

The assessment of a significant increase in credit risk and the calculation of expected credit losses involve forward-looking
information. Through historical data analysis, the Group has identified key economic indicators that affect the credit risks
and expected credit losses of various business types. The impact of these economic indicators on the probability of default
and the loss rate of default varies with different business types.

The exposure to credit risk

As at 31 December 2020 and 31 December 2019,the exposure to credit risk of accounts receivable, other receivable, debt
investments and long-term receivable refers to Note V.3,4,5,7,9,12,and 13.

Liquidity risk
The Group uses circular liquidity planning tools to manage the risk of funding shortfalls. The facility takes into account both
the maturity date of its financial instruments and the expected cash flows from the Group’s operations.

The objective of the Group is to maintain a balance between sustainability and flexibility in financing through the use of
a variety of financing instruments. As at 31 December 2020 and 31 December 2019, the Group’s financial liabilities were
mainly due within one year.

The tables below summarise the maturity profile of the Group’s financial liabilities based on contractual undiscounted
payments:

31 December 2020

Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total

Short-term borrowings 29,753,230 – – – 29,753,230
Notes payable 5,265,592 – – – 5,265,592
Accounts payable 502,386,965 – – – 502,386,965
Other payables 118,273,242 – – – 118,273,242
Other current liabilities 2,321,309 – – – 2,321,309
Long-term borrowings 58,637,680 75,728,382 166,073,850 104,139,890 404,579,802
Bonds payable 47,299,825 4,555,942 21,270,929 99,006,795 172,133,491
Long-term payables 11,314,629 13,172,142 4,883,129 146,705 29,516,605
Other non-current liabilities – – 7,039,339 – 7,039,339
Financial guarantee contracts 88,988,726 830,358 214,850 3,500,000 93,533,934
Total 864,241,198 94,286,824 199,482,097 206,793,390 1,364,803,509

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VIII. Financial instrument and risk (continued)

3. Financial instrument risks (continued)

Liquidity risk (continued)

The tables below summarise the maturity profile of the Group’s financial liabilities based on contractual undiscounted
payments:(continued)

31 December 2019
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
Short-term borrowings 29,076,353 – – – 29,076,353
Notes payable 7,030,414 – – – 7,030,414
Accounts payable 493,129,630 – – – 493,129,630
Other payables 114,030,641 – – – 114,030,641
Other current liabilities 1,406,893 – – – 1,406,893
Long-term borrowings 53,600,827 72,035,107 134,177,611 90,273,571 350,087,116
Bonds payable 34,084,055 27,454,496 51,361,125 53,749,429 166,649,105
Long-term payables 14,053,066 15,165,467 5,199,152 229,713 34,647,398
Other non-current liabilities 6,939,864 – 6,762,559 – 13,702,423
Financial guarantee contracts 67,895,772 1,179,501 569,100 3,500,000 73,144,373
Total 821,247,515 115,834,571 198,069,547 147,752,713 1,282,904,346

Note: The above-mentioned long-term borrowings, bonds payable, long-term payables and other non-current liabilities all
include the parts due within one year.

Market risk

Interest rate risk

The Group’s interest rate risk arises from interest bearing borrowings including borrowings, bonds payable. Financial
liabilities issued at floating rates expose the Group to cash flow interest rate risk. Financial liabilities issued at fixed rates
expose the Group to fair value interest rate risk.

The Group manages interest costs by maintaining an appropriate mix of fixed and variable rate debt. As at 31 December
2020, the Group’s interest bearing borrowings with fixed rates amounted to RMB207,600,058 thousand (31 December
2019: RMB217,468,888 thousand), and floating rates interest bearing borrowings amounted to RMB292,999,141 thousand
(31 December 2019: RMB245,642,137 thousand).

The Group’s finance department at its headquarters continuously monitors the interest rate position of the Group. Increases
in interest rates will increase the cost of new borrowings and the interest expenses with respect to the Group’s outstanding
floating rate borrowings, which could have a material adverse effect on the Group’s financial position. The management
of the Group makes decisions with reference to the latest market conditions. The Group may enter into interest rate swap
agreements to mitigate its exposure to interest rate risk. For 2020 and 2019 the Group did not enter into any significant
interest rate swap agreements.

As at 31 December 2020, if the borrowing interest rate calculated at floating interest rate had been 50 basis points higher/
lower, with all other variables held constant, the Group’s net profit would have been decreased/increased by approximately
RMB1,167 million (31 December 2019: approximately RMB982 million).

Currency risk

The Group’s major operational activities are carried out in Mainland China and a majority of the transactions is denominated
in RMB. The Group’s confirmed foreign currency assets and liabilities and future foreign currency transactions (foreign
currency assets and liabilities and foreign currency transactions are mainly denominated in US dollars and HK dollars) are
subject to foreign exchange risks. The Group’s finance department at its headquarters is responsible for monitoring the
foreign currency transactions and the scale of foreign currency assets and liabilities to minimize foreign exchange risks;.
The Group may consider entering into forward exchange contracts or currency swap contracts to mitigate the foreign
exchange risk. During 2020 and 2019, the Group did not enter into any significant forward exchange contracts or currency
swap contracts.

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VIII. Financial instrument and risk (continued)

3. Financial instrument risks (continued)

Market risk (continued)

Currency risk (continued)

As at 31 December 2020, for Group’s all kinds of foreign currency financial assets and foreign currency financial liabilities,
if RMB appreciation or devaluation against foreign currency were 10%, other factors remain unchanged, the Group would
increase or decrease by approximately RMB9.788 billion (31 December, 2019: approximately RMB9.665 billion).

Equity instrument price risk

The Group’s equity instrument price risk mainly arises from various types of equity instrument investments, and there is a
risk of changes in equity instrument prices.

As at 31 December 2020, if the expected price of various types of equity instrument investments of the Group increased
or decreased by 10% and other factors remained unchanged, the Group’s net profit would increase or decrease by
approximately RMB27,949 thousand (31 December 2019: approximately RMB5,841 thousand), other comprehensive
income would increase or decrease by approximately RMB696,888 thousand (31 December 2019: approximately
RMB902,152 thousand).

4. Capital management

The primary objectives of the Group’s capital management are to safeguard the Group’s ability to continue as a going
concern and to maintain healthy capital ratios in order to support business development and maximize shareholder value.

The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions and the
risk profile of related assets. To maintain or adjust the capital structure, the Group may adjust the dividend payment to
owners, return capital to owners or issue new shares. The Group is not subject to external mandatory capital requirements.
No changes in the objectives, policies or processes for managing capital were made in 2020 and 2019.

The Group’s total capital is the shareholders’ equity shown in the consolidated balance sheet. The Group uses the gearing
ratio to monitor its capital. The debt to assets ratio refers to the consolidated balance sheet total liabilities divided by total
assets. The debt to assets ratio of the Group at the balance sheet date was as follows:
31 December 2020 31 December 2019
Total liabilities 1,615,078,738 1,532,616,609
Total assets 2,192,173,839 2,034,451,929
Debt to assets ratio 73.67% 75.33%

IX. Disclosure of fair value

1. Assets and liabilities measured at fair value

2020

Fair value measurement using

Quoted prices Significant
in active observable Significant
markets inputs unobservable inputs
(Level 1) (Level 2) (Level 3) Total
Recurring fair value measurements
Financial assets held for trading
  Debt investments 214,859 – – 214,859
  Equity investments 29,600 – – 29,600
Accounts receivables financing – – 3,788,082 3,788,082
Other current assets

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IX. Disclosure of fair value (continued)

1. Assets and liabilities measured at fair value (continued)

2020 (continued)

Fair value measurement using

Quoted prices Significant
in active observable Significant
markets inputs unobservable inputs
(Level 1) (Level 2) (Level 3) Total
  Investment in listed equity instrument 2,906,177 – – 2,906,177
Other non-current financial assets
  Investment in stock – – 35,510 35,510
  Investment in fund – – 300,000 300,000
Non-current assets due within one year 182,608 – – 182,608
Other investment in debenture instrument 356,377 – – 356,377
Other investment in equity instrument
  Investment in listed equity instrument 1,329,839 – – 1,329,839
  Investment in non-listed equity instrument – – 4,508,545 4,508,545
Total financial assets 5,019,460 – 8,632,137 13,651,597
Recurring fair value measurements
Other non-current liabilities – 4,421,322 – 4,421,322
Total financial liabilities – 4,421,322 – 4,421,322

2019

Fair value measurement using

Quoted prices Significant
in active observable Significant
markets inputs unobservable inputs
(Level 1) (Level 2) (Level 3) Total
Recurring fair value measurements
Financial assets held for trading
  Debt investments 856,602 – 5,705 862,307
  Equity investments 39,765 – – 39,765
Accounts receivable financing – – 3,674,166 3,674,166
Other current assets
  Investment in listed equity instrument – 3,557,504 – 3,557,504
Other non-current financial assets
  Investment in stock – – 35,510 35,510
  Investment in fund – – 15,000 15,000
Other investment in debenture instrument 612,106 – – 612,106
Other investment in equity instrument
  Investment in listed equity instrument 1,659,862 – – 1,659,862
  Investment in non-listed equity instrument – – 6,409,181 6,409,181
Total financial assets 3,168,335 3,557,504 10,139,562 16,865,401
Recurring fair value measurements
Current portion of non-current liabilities – 6,939,864 – 6,939,864
Other non-current liabilities – 4,695,968 – 4,695,968
Total financial liabilities – 11,635,832 – 11,635,832

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IX. Disclosure of fair value (continued)

2. Valuation of fair value

Fair value of financial instruments

The illustration below is the disclosure on comparison between the fair value and the carrying amount for each class of
financial assets and financial liabilities other than financial instruments where the difference between the carrying amount
and the fair value is insignificant:
Carrying amounts Fair value
31 December 31 December 31 December 31 December
2020 2019 2020 2019
Bonds payable 88,782,471 99,596,598 95,718,907 102,571,419

The fair value of bonds payable quoted in an active market is determined at the quoted market price, and categorised
within Level 1 of the fair value hierarchy. The fair value of bonds payable not quoted in an active market is the present
value of the contractually determined stream of future cash flows discounted at the rate of interest applied at that time by
the market to instruments of comparable credit status and providing substantially the same cash flows on the same terms,
and categorised within Level 3 of the fair value hierarchy.

Management has assessed that the fair value of cash and bank balances, notes receivable, accounts receivable, other
receivables, short-term loans, notes payable, accounts payable and other payables. Given the short term maturities, the
fair value approximate to the carrying value.

The Group’s finance department headed by the person in charge of the accounting institution is responsible for
determining the policies and procedures for the fair value measurement of financial instruments. The person in charge of
the accounting institution reports directly to the person in charge of accounting work and the audit committee. At each
reporting date, the finance department analyses the movements in the value of financial instruments and determines the
major inputs applied in the valuation. The valuation is reviewed and approved by the person in charge of accounting work.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged
in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and
assumptions were used to estimate the fair value.

Long-term receivables, long-term borrowings, debt investments, bonds payable, etc., adopt the future cash flow discount
method to determine the fair value, and use the market yield of other financial instruments with similar contractual terms,
credit risks and remaining maturity as the discount rate. As of 31 December 2020 and 31 December, 2019, the fair value of
long-term receivables, long-term borrowings and debt investments approximated to the carrying amount. The default risk
of long-term borrowings was evaluated as insignificant.

The fair value of listed equity instrument investment is determined at the market price. For investment in unlisted equity
instruments, valuation models such as discounted cash flow models and market-comparable company models are used to
estimate fair value, and the assumptions used are not supported by observable market prices or interest rates. The Group
believes that the fair value and its changes estimated by valuation techniques are reasonable and are the most appropriate
value on the balance sheet date.

3. Unobservable inputs

The valuation models used are mainly discounted cash flow models and market-comparable company models. The input
value of valuation techniques mainly include future cash flows, price-to-book ratio and price-earnings ratio of companies of
the same category.

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IX. Disclosure of fair value (continued)

4. Reconciliation of fair value measurements

Reconciliation of recurring fair value measurements within Level 3 is as follows:

2020

Changes in
Total gains or losses unrealised
during the year gains or losses
Included in included in
Opening other Closing profit or loss for
balance of Included in comprehensive balance of the assets held at
the year profit or loss income Purchases Sales year end of the year
Financial assets held for trading
  Debt investments 5,705 996 – – (6,701) – –
Accounts receivable financing 3,674,166 – – 5,671,235 (5,557,319) 3,788,082 –
Other non-current financial assets
  Investment in stock 35,510 – – – – 35,510 –
  Investment in fund 15,000 – – 300,000 (15,000) 300,000 –
Other investment in equity instrument
  Investment in unlisted equity instrument 6,409,181 28,385 (451,259) 605,341 (2,054,718) 4,508,545 –
Total 10,139,562 29,381 (451,259) 6,576,576 (7,633,738) 8,632,137 –

2019

Changes in
Total gains or losses unrealised
during the year gains or losses
Included in Closing included in
Opening other balance of the profit or loss for
balance of Included in comprehensive year assets held at
the year profit or loss income Purchases Sales end of the year
Financial assets held for trading
  Debt investments 393,676 16,813 – 548,216 (927,798) 5,705 –
Accounts receivable financing 3,427,192 – – 3,672,874 (3,425,900) 3,674,166 –
Other non-current financial assets
  Investment in stock 268,932 (233,422) – – – 35,510 (233,422)
  Investment in fund – – – 15,000 – 15,000 –
Other investment in equity instrument
  Investment in unlisted equity instrument 5,460,759 30,320 533,676 643,658 (228,912) 6,409,181 –
Total 9,550,559 (186,289) 533,676 4,879,748 (4,582,610) 10,139,562 (233,422)

For recurring fair value measurements categorised within Level 3 of the fair value hierarchy, gains and losses included in
profit or loss that relate to financial assets and non-financial assets are as follows:
2020
Profit or loss Profit or loss
related to related to
financial assets non-financial assets
Total realised gains included in profit or loss 29,381 –
Changes in unrealised losses included in profit or loss for – –

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IX. Disclosure of fair value (continued)

4. Reconciliation of fair value measurements (continued)

For recurring fair value measurements categorised within Level 3 of the fair value hierarchy, gains and losses included in
profit or loss that relate to financial assets and non-financial assets are as follows: (continued)
2019
Profit or loss Profit or loss
related to related to
financial assets non-financial assets
Total realised losses included in profit or loss (186,289) –
Changes in unrealised losses included in profit or loss for (233,422) –

5. Fair value level conversion

During the year of 2020, Due to ban lifting of restricted shares, the fair value level of the listed equity instrument investment
of other current assets continuously measured at fair value has changed from level 2 to level 1 (During the year of
2019:No).

X. Related party relationships and transactions

1. Parent

Proportion of Proportion of
ownership interest in voting power in
Registered address Nature of business Registered capital the Company (%) the Company (%)
CSCEC Beijing Investment holding 10 billion 56.31 56.31

The Company’s ultimate controlling party is State-owned Assets Supervision and Administration Commission of the State
Council.

2. Subsidiaries

The company’s important subsidiaries refer to Note VII. 1.

3. Joint ventures and associates

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows:
Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Joint Ventures (Note 5)
Real estate investment
Clear Elegant Limited (Note 1) Hong Kong, China Hong Kong, China No 30.00
and development business
Real estate investment
Gainable Development Limited (Note 1) Hong Kong, China Hong Kong, China No 20.00
and development business
Infrastructure construction
Luminous Dream Limited (Note 1) Hong Kong, China Hong Kong, China No 30.00
business
Real estate investment
Marble Edge Limited (Note 1) Hong Kong, China Hong Kong, China No 18.00
and development business
Sunrise JV Limited Hong Kong, China Hong Kong, China Other business No 50.00
Real estate investment
Top Colour Development Limited (Note 1) Hong Kong, China Hong Kong, China No 34.00
and development business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Joint Ventures (continued) (Note 5)
Infrastructure construction
Anhui Bengwu Expressway Investment Management (Note 1) Anhui, China Anhui, China No 70.00
business
Real estate investment
Beijing Nanyue Real Estate Development Co., Ltd. (Note 1) Beijing, China Beijing, China No 35.00
and development business
Cangzhou Bohai New Area China Construction Port Construction Infrastructure construction
Hebei, China Hebei, China No 90.00
Management Co., Ltd. (Note 1) business
Cangzhou CSCEC Bohai investment Logistics Park Construction Infrastructure construction
Hebei, China Hebei, China No 30.00
Development Co., Ltd. (Note 1) business
Infrastructure construction
Dazhou Dahuan Development Management Co., Ltd. (Note 1) Sichuan, China Sichuan, China No 65.80
business
Infrastructure construction
Dalian CSCEC sponge City Construction Development (Note 1) Liaoning, China Liaoning, China No 49.00
business
Infrastructure construction
Danjiangkou Haijia Construction Co., Ltd. (Note 1) Hubei, China Hubei, China No 60.00
business
Real estate investment
Dongguan Jiafang Real Estate Development Co., Ltd. (Note 1) Guangdong, China Guangdong, China No 32.50
and development business
Dongguan Zhonghai Century City Education Technology Guangdong, China Guangdong, China Other business No 50.00
Real estate investment
Ezhou Chuanggu Real Estate Development Co., Ltd. Hubei, China Hubei, China No 50.00
and development business
Real estate investment
Foshan Jiantou Zhongjian Yipin Real Estate Co., Ltd. (Note 1) Guangdong, China Guangdong, China No 49.00
and development business
Real estate investment
Foshan Zhongjian Yipin Pengyue Real Estate Co., Ltd. (Note 1) Guangdong, China Guangdong, China No 51.00
and development business
Real estate investment
Guangzhou Hong Land Co., Ltd. (Note 1) Guangdong, China Guangdong, China No 51.00
and development business
Real estate investment
Guangzhou SuiHai Real Estate Co., Ltd. (Note 1) Guangdong, China Guangdong, China No 25.00
and development business
Real estate investment
Guiheng Investment Co., Ltd. Chongqing, China Hong Kong, China No 50.00
and development business
Guizhou Leirong Expressway Investment Management Co., Ltd. Infrastructure construction
Guizhou, China Guizhou, China No 68.90
(Note 1) business
Guizhou Zhengxi Expressway Investment Management Co., Ltd. Infrastructure construction
Guizhou, China Guizhou, China No 60.00
(Note 1) business
Haixing Materials Co., Ltd. (Note 4) Hong Kong, China Hong Kong, China Sales materials No –
Real estate investment
Guangzhou XingLv Real Estate Development Co., Ltd. Guangdong, China Guangdong, China No 50.00
and development business
Infrastructure construction
CSCEC New Urbanization (Xinjiang) Investment Co., Ltd. (Note 1) Xinjiang, China Xinjiang, China No 20.00
business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Joint Ventures (continued) (Note 5)
Real estate investment
China Resources (Tai) Land Co., Ltd. Shanxi, China Shanxi, China No 50.00
and development business
Infrastructure construction
Huizhou Zhongjian municipal fifth Road Investment (Note 3) Guangdong, China Guangdong, China No 100.00
business
China Construction Jingmen 207 Highway Construction Co., Ltd. Infrastructure construction
Hubei, China Hubei, China No 52.00
(Note 1) business
Real estate investment
Longguang International Co., Ltd. (Note 3) Chongqing, China Hong Kong, China No 60.00
and development business
Real estate investment
Leading Investment Co., Ltd. (Note 1) Jiangsu, China Hong Kong, China No 51.00
and development business
Liupanshui urban pipe gallery construction and Development Infrastructure construction
Guizhou, China Guizhou, China No 80.00
Investment Co., Ltd. (Note 1) business
Mianyang Zhongjian Kefa Guanlang road investment and Housing construction
Sichuan, China Sichuan, China No 31.58
Construction Co., Ltd. (Note 1) business
Real estate investment
Nanjing Kang Real Estate Development Co., Ltd. (Note 1) Jiangsu, China Jiangsu, China No 49.00
and development business
Real estate investment
Qingdao Fangchen Real Estate Co., Ltd. (Note 1) Shandong, China Shandong, China No 18.00
and development business
Real estate investment
Qingdao Fangchuan Real Estate Co., Ltd. (Note 1) Shandong, China Shandong, China No 18.00
and development business
Real estate investment
Qingdao Fanghui Real Estate Co., Ltd. (Note 1) Shandong, China Shandong, China No 18.00
and development business
Real estate investment
Qingdao Fangqian Real Estate Co., Ltd. (Note 1) Shandong, China Shandong, China No 18.00
and development business
Real estate investment
Qingdao Maozhang Real Estate Co., Ltd. (Note 1) Shandong, China Shandong, China 否 18.00
and development business
Real estate investment
Qingdao Songmao Real Estate Co., Ltd. (Note 1) Shandong, China Shandong, China 否 18.00
and development business
Real estate investment
Qingdao tengmao Real Estate Co., Ltd. (Note 1) Shandong, China Shandong, China 否 18.00
and development business
Real estate investment
Qufu Nishan cultural tourism real estate Co., Ltd. (Note 1) Shandong, China Shandong, China No 60.00
and development business
Quanzhou Taiwan Business Investment Zone China Construction Infrastructure construction
Fujian, China Fujian, China No 50.00
Fifth Bureau Haiwan Avenue Investment Co., Ltd. business
Infrastructure construction
Rizhao Zhongjian Transportation Service Co., Ltd. (Note 1) Shandong, China Shandong, China No 26.50
business
Real estate investment
Sanya Bihai Jincheng Business Management Co., Ltd. (Note 1) Hainan, China Hainan, China No 17.00
and development business
Real estate investment
Xiamen Yongjing Bay Real Estate Co., Ltd. (Note 1) Fujian, China Fujian, China No 20.00
and development business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Joint Ventures (continued) (Note 5)
Shandong China Overseas Huachuang Real Estate Real estate investment
Shandong, China Shandong, China No 60.00
Co., Ltd. (Note 1) and development business
Shenzhen Shenshan special cooperation zone Zhongpu Infrastructure construction
Guangdong, China Guangdong, China No 64.00
Infrastructure Investment Co., Ltd. (Note 1) business
Sichuan Huayou Zhonglan Energy Co., Ltd. (Note 1) Sichuan, China Sichuan, China Other business No 12.00
Infrastructure construction
TEDA Group Co., Ltd. (Note 1) Hong Kong, China Hong Kong, China No 33.00
business
Tianjin Chuangliang Investment Management Co., Ltd. (Note 1) Tianjin, China Tianjin, China Other business No 34.00
Tianjin Chuangqing Investment Management Co., Ltd. (Note 1) Tianjin, China Tianjin, China Other business No 51.00
Real estate investment
Tianjin Shunji Real Estate Co., Ltd. (Note 1) Tianjin, China Tianjin, China No 12.50
and development business
Real estate investment
Tianjin Wanjiang Real Estate Co., Ltd. (Note 1) Tianjin, China Tianjin, China No 33.40
and development business
Real estate investment
Tianjin Yingchao Real Estate Development Co., Ltd. Tianjin, China Tianjin, China No 50.00
and development business
Tongxiang Haoli Enterprise Management Co., Ltd. (Note 1) Zhejiang, China Zhejiang, China Other business No 25.00
Ulanhot City Xingcai Fund Management Center
Neimenggu, China Neimenggu, China Other business No 49.99
(Limited Partnership) (Note 1)
Urumqi Linkong Construction Infrastructure Co., Ltd. (Note 1) Xinjiang, China Xinjiang, China Other business No 49.00
Urumqi Zhongcheng Silk Road Sports Management Co., Ltd.
Xinjiang, China Xinjiang, China Other business No 65.34
(Note 1)
Infrastructure construction
Xi’an Chuxin investment and Construction Co., Ltd. (Note 1) Shanxi, China Shanxi, China No 49.00
business
Real estate investment
Xi’an Dingsheng Dongyue Properties Co., Ltd. Shanxi, China Shanxi, China No 50.00
and development business
Real estate investment
Xi’an Hehui Xingshang Properties Co., Ltd. Shanxi, China Shanxi, China No 50.00
and development business
Real estate investment
Xi’an Jiarun Rongcheng Real Estate Co., Ltd. Shanxi, China Shanxi, China No 50.00
and development business
Infrastructure construction
Xiangtan Haijia Construction Co., Ltd. (Note 1) Hunan, China Hunan, China No 51.00
business
Real estate investment
Hing Chong Enterprise Co., Ltd. Hong Kong, China Hong Kong, China No 50.00
and development business
Real estate investment
Xinggui Investment Co., Ltd. Zhejiang, China Hong Kong, China No 50.00
and development business
Xuzhou Metro Line Three Investment Development Infrastructure construction
Jiangsu, China Jiangsu, China No 44.44
Co., Ltd. (Note 1) business
Real estate investment
Xuancheng Haijia Lancheng Real Estate Co., Ltd. (Note 1) Anhui, China Anhui, China No 65.00
and development business
Chongqing Zhongjian Hailong Liangjiang Construction Housing construction
Chongqing, China Chongqing, China No 70.00
Technology Co., Ltd. (Note 1) business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Joint Ventures (continued) (Note 5)
Housing construction
TDE-Empreendimentos Imobiliarios, S.A. Portugal Portugal No 50.00
business
Real estate investment
Young Yue Investment Co., Ltd. (Note 1) Hong Kong, China Hong Kong, China No 45.00
and development business
Yinchuan Shenyang Road Underground Comprehensive Pipe Infrastructure construction
Ningxia, China Ningxia, China No 70.00
Gallery Construction Management Co., Ltd. (Note 1) business
Real estate investment
Changsha Yida Chuangzhi Property Development Co., Ltd. (Note 1) Hunan, China Hunan, China No 49.00
and development business
Changsha CSCEC Urban Investment Pipe Gallery Construction Infrastructure construction
Hunan, China Hunan, China No 66.94
Investment Co., Ltd. (Note 1) business
Infrastructure construction
Changsha Zhongjian International Development Co., Ltd. (Note 1) Hunan, China Hunan, China No 65.00
business
Changsha China Construction Future Technology City Investment Infrastructure construction
Hunan, China Hunan, China No 51.00
Co., Ltd. (Note 1) business
Zhaotong Zhongjian Construction Investment Development Infrastructure construction
Yunnan, China Yunnan, China No 51.00
Co., Ltd. (Note 1) business
Infrastructure construction
Zhengzhou CSCEC Shenzhen Rail Transit Co., Ltd. (Note 1) Henan, China Henan, China No 61.00
business
China Shipping Hecai (Beijing) Equity Investment Fund
Beijing, China Beijing, China Other business No 55.00
Management Co., Ltd. (Note 1)
Shipping Hongyang Haifu (Hefei) Real Estate Development Real estate investment
Anhui, China Anhui, China No 45.00
Co., Ltd. (Note 1) and development business
China Construction (Tangshan Caofeidian) Engineering Infrastructure construction
Hebei, China Hebei, China No 90.00
Construction Co., Ltd. (Note 1) business
China Construction (Tianjin) Rail Transit Investment Development Infrastructure construction
Tianjin, China Tianjin, China No 25.50
Co., Ltd. (Note 1) business
CSCEC Chengdu rail transit investment and Construction Infrastructure construction
Sichuan, China Sichuan, China No 20.00
Co., Ltd. (Note 1) business
Housing construction
CSCEC Dacheng Construction Co., Ltd. Beijing, China Beijing, China No 50.00
business
China Construction International (Xiangyang) Construction Housing construction
Hubei, China Hubei, China No 70.00
Co., Ltd. (Note 1) business
China Construction Haijia (Foshan) Investment and Construction
Guangdong, China Guangdong, China Other business No 80.00
Co., Ltd. (Note 1)
Housing construction
China State Construction Technology Hubei Co., Ltd. (Note 1) Hubei, China Hubei, China No 60.00
business
Construction Technology Jingmen Co., Ltd. Hubei, China Hubei, China Other business No 50.00
Infrastructure construction
CSCEC Road & Bridge Group Co., Ltd. (Note 1) Hebei, China Hebei, China No 51.00
business
China Construction Third Bureau Hubei Dadong Lake Deep Tunnel Infrastructure construction
Hubei, China Hubei, China No 55.00
Engineering Construction and Operation Co., Ltd. (Note 1) business
China State Construction Xi’an Infrastructure Construction Infrastructure construction
Shanxi, China Shanxi, China No 25.00
Investment Co., Ltd. (Note 1) business
China State Construction Zhanjiang Avenue Investment and Infrastructure construction
Guangdong, China Guangdong, China No 70.00
Construction Co., Ltd. (Note 1) business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Joint Ventures (continued) (Note 5)
Infrastructure construction
China Construction Zhengda Technology Co., Ltd. Beijing, China Beijing, China No 50.00
business
Real estate investment
CITIC Polytec Real Estate (Foshan) Co., Ltd. Guangdong, China Guangdong, China No 50.00
and development business
Real estate investment
Chongqing Qingneng Yuehe Real Estate Co., Ltd. (Note 1) Chongqing, China Chongqing, China No 49.00
and development business
Infrastructure construction
Zunyi South Ring Expressway Development Co., Ltd. (Note 1) Guizhou, China Guizhou, China No 60.00
business
Real estate investment
Fuzhou Xinzhi Investment Development Co., Ltd. Fujian, China Fujian, China No 50.00
and development business
Associates (Note 5)
Real estate investment
Fast Shift Investments Limited Macao, China Macao, China No 29.00
and development business
Macau Cement Works Co., Ltd. Macao, China Macao, China Sales materials No 31.34
Baoding China Construction Industrial Investment Infrastructure construction
Hebei, China Hebei, China No 15.00
Co., Ltd. (Note 2) business
Beijing National Alpine Skiing Co., Ltd. (Note 2) Beijing, China Beijing, China Other business No 12.00
Real estate investment
Beijing Huiguang Enterprise Management Co., Ltd. (Note 2) Beijing, China Beijing, China No 16.52
and development business
Real estate investment
Beijing Jianyan Real Estate Development Co., Ltd. Beijing, China Beijing, China No 49.00
and development business
Real estate investment
Beijing Jinliang Xingye Real Estate Development Co., Ltd. Beijing, China Beijing, China No 40.00
and development business
Beijing China Construction Zhongchao Concrete Co., Ltd. Beijing, China Beijing, China Other business No 30.00
Beijing China Construction Runtong Electrical Engineering Housing construction
Beijing, China Beijing, China No 30.00
Construction Co., Ltd. business
Real estate investment
Chengdu Beichen Tianchen Real Estate Co., Ltd. Sichuan, China Sichuan, China No 20.00
and development business
Housing construction
Chengdu Chuanhui Jianxing Construction Co., Ltd. Sichuan, China Sichuan, China No 20.00
business
Infrastructure construction
Chengdu Chuantou Airport Construction Co., Ltd. Sichuan, China Sichuan, China No 20.00
business
Infrastructure construction
Chengdu Changtou Dongjin Construction Co., Ltd. (Note 2) Sichuan, China Sichuan, China No 1.00
business
Guangzhou Fuchuang Real Estate Development Co., Ltd. Real estate investment
Guangdong, China Guangdong, China No 34.00
(Note 2) and development business
Real estate investment
Guangzhou Zengcheng run Yu Real Estate Co., Ltd. Guangdong, China Guangdong, China No 20.00
and development business
Infrastructure construction
Haikou Qiyue Urban Construction Co., Ltd. (Note 2) Hainan, China Hainan, China No 2.00
business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Associates (continued) (Note 5)
Real estate investment
Haikou Tuoyi Real Estate Co., Ltd. Hainan, China Hainan, China No 20.00
and development business
Hanzhong Xinghan City Parking Lot Construction Management
Shanxi, China Shanxi, China Other business No 18.00
Co., Ltd. (Note 2)
Hangzhou Chengtou Wulin Investment Development Co., Ltd. Infrastructure construction
Zhejiang, China Zhejiang, China No 15.00
(Note 2) business
Infrastructure construction
Hebei Chenghong Pipe Gallery Engineering Co., Ltd. (Note 2) Hebei, China Hebei, China No 5.00
business
Infrastructure construction
Hebei Xiong’an Citizen Service Center Co., Ltd. (Note 2) Hebei, China Hebei, China No 50.50
business
Infrastructure construction
Hubei Trading Xiangyang North Expressway Co., Ltd. Hubei, China Hubei, China No 20.00
business
Real estate investment
Jinan Hongbi Real Estate Co., Ltd. Shandong, China Shandong, China No 20.00
and development business
Real estate investment
Jinan Taihui Real Estate Development Co Ltd. Shandong, China Shandong, China No 33.00
and development business
Jining Yanzhou Zhongjian Transportation Construction Infrastructure construction
Shandong, China Shandong, China No 32.36
Development Co., Ltd. business
Infrastructure construction
Jiqing High Speed Railway Co., Ltd. (Note 2) Shandong, China Shandong, China No 8.40
business
Jiangmen Pengjiang Hebang Real Estate Development Real estate investment
Guangdong, China Guangdong, China No 50.00
Co., Ltd. (Note 2) and development business
Jiaozuo Zhongjian south to North Water Diversion ecological
Henan, China Henan, China Other business No 30.00
protection construction and Operation Co., Ltd.
Real estate investment
Jinmao investment (Changsha) Co., Ltd. Hunan, China Hunan, China No 20.00
and development business
Real estate investment
Jinyu Jiaxing Nanjing Real Estate Development Co., Ltd. Nanjing, China Nanjing, China No 30.00
and development business
Jinjiang Zhongyun Sports Construction Development Co., Ltd. Infrastructure construction
Fujian, China Fujian, China No 10.00
(Note 2) business
Liuzhou China Construction Steel Structure Dongcheng Infrastructure construction
Guangxi, China Guangxi, China No 40.00
Exhibition Construction Co., Ltd. business
Liupanshui Dongda highway investment and Development Infrastructure construction
Guizhou, China Guizhou, China No 50.00
Co., Ltd. (Note 2) business
Luzhou Yangtze River Second Bridge Construction Infrastructure construction
Sichuan, China Sichuan, China No 10.00
Co., Ltd. (Note 2) business
Real estate investment
Nanjing Guancheng Hengrui Real Estate Co., Ltd. Jiangsu, China Jiangsu, China No 33.00
and development business
Infrastructure construction
Nanjing CSCEC Gubei Urban Development Co., Ltd. Jiangsu, China Jiangsu, China No 45.00
business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Associates (continued) (Note 5)
Nanjing Zhongjian Rural Tourism Construction Investment Infrastructure construction
Jiangsu, China Jiangsu, China No 20.00
Co., Ltd. business
Nanyang Zhongjian Jinrui Urban Construction Development Infrastructure construction
Henan, China Henan, China No 20.00
Co., Ltd. business
Panzhihua China Construction Third Bureau Government Service Infrastructure construction
Sichuan, China Sichuan, China No 9.00
Center Project Construction Development Co., Ltd. (Note 2) business
Infrastructure construction
Panjin Xinjian Construction Co., Ltd. Liaoning, China Liaoning, China No 45.85
business
Pingdingshan City Development and Investment China Construction
Henan, China Henan, China Other business No 42.77
City First Hospital New District Management Co., Ltd.
Housing construction
Putian Puyang University Construction Co., Ltd. Fujian, China Fujian, China No 32.90
business
Infrastructure construction
Putian Zhongjian Mulan Construction Development Co., Ltd. Fujian, China Fujian, China No 49.90
business
Real estate investment
Qingdao Changming Real Estate Co., Ltd. Shandong, China Shandong, China No 22.50
and development business
Real estate investment
Qingdao Runfu Real Estate Co., Ltd. Shandong, China Shandong, China No 47.62
and development business
Real estate investment
Qingdao Yufu Real Estate Co., Ltd. Shandong, China Shandong, China No 20.00
and development business
Real estate investment
Qingdao Yuefu Real Estate Co., Ltd. Shandong, China Shandong, China No 20.00
and development business
Real estate investment
Qingdao Zefu Real Estate Co., Ltd. Shandong, China Shandong, China No 20.00
and development business
Qingdao China Construction Eighth Bureau Urban Investment Infrastructure construction
Shandong, China Shandong, China No 2.68
Development Co., Ltd. (Note 2) business
Qingdao China Construction Eighth Bureau Education
Shandong, China Shandong, China Other business No 38.65
Development Co., Ltd.
Rizhao China Construction Eighth Bureau culture and Infrastructure construction
Shandong, China Shandong, China No 14.00
Technology Development Co., Ltd. (Note 2) business
Sanmenxia National Highway 310 South Moving Project Infrastructure construction
Henan, China Henan, China No 40.00
Construction Management Co., Ltd. business
Xiamen Haitou Construction Technology Co., Ltd. Fujian, China Fujian, China Other business No 30.00
Real estate investment
Xiamen Junyi Properties Co., Ltd. (Note 2) Fujian, China Fujian, China No 50.00
and development business
Infrastructure construction
Shandong Qilu Ningliang Expressway Co., Ltd. Shandong, China Shandong, China No 49.00
business
Shandong Zhongcheng Machinery Leasing Co., Ltd. Shandong, China Shandong, China Leasing business No 30.00
Shandong Zhongjian Material Equipment Co., Ltd. Shandong, China Shandong, China Other business No 30.00
Shandong Zhongjian Zhongli Equipment Leasing Co., Ltd. Shandong, China Shandong, China Leasing business No 30.00
Infrastructure construction
Shantou CSCEC new urbanization Investment Co., Ltd. Guangdong, China Guangdong, China No 36.77
business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Associates (continued) (Note 5)
Shangqiu Xinhangcheng development and Construction Infrastructure construction
Henan, China Henan, China No 4.16
Management Co., Ltd. (Note 2) business
Shangqiu Yunheng Urban Construction Development Infrastructure construction
Henan, China Henan, China No 7.61
Co., Ltd. (Note 2) business
Shangqiu China Construction Cloud City Urban Construction Infrastructure construction
Henan, China Henan, China No 9.00
Development Co., Ltd. (Note 2) business
Real estate investment
Shanghai Fuhong Real Estate Co., Ltd. (Note 3) Shanghai, China Shanghai, China No 100.00
and development business
Real estate investment
Shanghai Jiasheng Real Estate Development Co., Ltd. Shanghai, China Shanghai, China No 49.00
and development business
Real estate investment
Shanghai Xingxin Real Estate Development Co., Ltd. (Note 4) Shanghai, China Shanghai, China No –
and development business
Shijiazhuang Jiaojian Expressway Construction Management Infrastructure construction
Hebei, China Hebei, China No 49.00
Co., Ltd. business
Sichuan Xijianshantui Logistics Co., Ltd. Sichuan, China Sichuan, China Other business No 30.00
Sichuan Xijianzhonghe Machinery Co., Ltd. Sichuan, China Sichuan, China Other business No 44.44
Real estate investment
Suzhou Fu Real Estate Co., Ltd. Jiangsu, China Jiangsu, China No 34.00
and development business
Real estate investment
Suzhou Mudu Zhongxin land Co., Ltd. Jiangsu, China Jiangsu, China No 35.00
and development business
Wenzhou China Construction Steel Structure Olympic Sports Infrastructure construction
Zhejiang, China Zhejiang, China No 15.00
Project Management Co., Ltd. (Note 2) business
Real estate investment
Wuhan Chenfa Real Estate Development Co., Ltd. Hubei, China Hubei, China No 20.00
and development business
Real estate investment
Wuhan Chenzhan Real Estate Development Co., Ltd. Hubei, China Hubei, China No 20.00
and development business
Wuhan Hongtai Hongli Zhongjian Yipin Real Estate Co., Ltd. Real estate investment
Hubei, China Hubei, China No 51.00
(Note 2) and development business
Real estate investment
Wuhan Zhongjian Yipin Zhaoying Real Estate Co., Ltd. (Note 2) Hubei, China Hubei, China No 50.00
and development business
Infrastructure construction
Wuhan Zhongxia Road Construction Engineering Co., Ltd. Hubei, China Hubei, China No 29.83
business
Xianyi International Co., Ltd. Hong Kong, China Hong Kong, China Other business No 30.00
Xinjiang China Construction Urban Construction Investment Infrastructure construction
Xinjiang, China Xinjiang, China No 20.00
Co., Ltd. business
Xinyu Huancheng Road Construction Investment Co., Ltd. Infrastructure construction
Jiangxi, China Jiangxi, China No 10.00
(Note 2) business
Housing construction
Suzhou Junda National Road 206 Construction Co., Ltd. Anhui, China Anhui, China No 20.00
business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Associates (continued) (Note 5)
Infrastructure construction
Suzhou Xinghui West Ring Road Construction Co., Ltd. Anhui, China Anhui, China No 30.93
business
Infrastructure construction
Xuzhou Metro Line Three Investment Development Co., Ltd. Jiangsu, China Jiangsu, China No 38.30
business
Real estate investment
Xuchang Chenheng Real Estate Co., Ltd. Henan, China Henan, China No 39.00
and development business
Infrastructure construction
Yunnan Huali expressway investment and Development Co., Ltd. Yunnan, China Yunnan, China No 46.00
business
Zhangzhou Zhan Environmental Technology Co., Ltd. (Note 2) Fujian, China Fujian, China Other business No 19.00
Infrastructure construction
Zhangzhou Yingzhi Construction Development Co., Ltd. (Note 2) Fujian, China Fujian, China No 3.00
business
Zhangzhou China Merchants Economic and Technological
Infrastructure construction
Development Zone China State Construction Infrastructure Fujian, China Fujian, China No 20.10
business
Investment and Development Co., Ltd.
Real estate investment
Changsha Rail China Construction Xinhe Real Estate Co., Ltd. Hunan, China Hunan, China No 20.00
and development business
Real estate investment
Changsha Xirong Real Estate Co., Ltd. Hunan, China Hunan, China No 33.00
and development business
Zhengzhou public Zhongcheng road and Bridge Construction Infrastructure construction
Henan, China Henan, China No 25.00
Management Co., Ltd. business
Real estate investment
Zhengzhou Xiangyue Real Estate Development Co., Ltd. Henan, China Henan, China No 40.00
and development business
Zhengzhou Yirongyijian Supply Chain Management Co., Ltd. (Note 2) Henan, China Henan, China Sales materials No 18.00
Real estate investment
China Ge Yongmao (Suzhou) Real Estate Development Co., Ltd. Jiangsu, China Jiangsu, China No 25.00
and development business
China Construction Haoyun Co., Ltd. Hebei, China Hebei, China Other business No 35.00
China Construction Third Bureau Ezhou Guang’an Real Estate Real estate investment
Hubei, China Hubei, China No 20.00
Development Co., Ltd. and development business
China Construction Third Engineering Bureau Jingzhou Huanchang Infrastructure construction
Hubei, China Hubei, China No 20.00
Lake construction and Operation Co., Ltd. business
China Construction Third Engineering Bureau Nanchong Infrastructure construction
Sichuan, China Sichuan, China No 15.00
Environmental Construction Investment Co., Ltd. (Note 2) business
China Construction Third Bureau Rongchang Chengdu Tianfu Real estate investment
Sichuan, China Sichuan, China No 46.00
New District Construction Investment Co., Ltd. and development business
China Construction Third Bureau Shengshi Jingzhou Real Estate Real estate investment
Hubei, China Hubei, China No 51.00
Development Co., Ltd. (Note 2) and development business
China Construction Third Engineering Bureau Shiyan aviation road Infrastructure construction
Hubei, China Hubei, China No 45.00
construction and Operation Co., Ltd. business

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Except the general information and other related information of joint ventures and associates set out in Note VII 2, the
situation of joint ventures and associated enterprises that have transactions with the group is listed as follows: (continued)

Strategic to
Main place of Place of group Shareholding
business registration Nature of business activities ratio (%)
Associates (continued) (Note 5)
China Construction Third Engineering Bureau Xianning Big Infrastructure construction
Hubei, China Hubei, China No 45.00
Continent Lake ecological construction and Operation Co., Ltd. business
China Construction Third Engineering Bureau Xiangyang Infrastructure construction
Hubei, China Hubei, China No 10.00
East West axis construction and Operation Co., Ltd. (Note 2) business
China Construction Third Engineering Bureau Yichang City pipe Infrastructure construction
Hubei, China Hubei, China No 41.29
gallery construction and Operation Co., Ltd. business
Wuhan Huangxiaohe Airport River Environment Comprehensive Infrastructure construction
Hubei, China Hubei, China No 42.20
Treatment Construction Operation Co., Ltd. business
CSCEC Wuhan Yangsigang Road and Bridge Construction and Infrastructure construction
Hubei, China Hubei, China No 40.00
Operation Co., Ltd. business
China State Construction Xi’an Urban Construction Investment Infrastructure construction
Shanxi, China Shanxi, China No 30.00
Co., Ltd. business
Oriental Anzhen (Beijing) Hospital Management Co., Ltd. (Note 2) Beijing, China Beijing, China Other business No 5.98
Real estate investment
Ezhou Zhongjian Yipin Lanyue Real Estate Co., Ltd. Hubei, China Hubei, China No 20.00
and development business
Real estate investment
Ganzhou Hangyu Construction Co., Ltd. (Note 2) Jiangxi, China Jiangxi, China No 2.10
and development business
Hong Kong and Kowloon Concrete Co., Ltd. Hong Kong, China Hong Kong, China Sales materials No 31.50
Real estate investment
Guangzhou Bisen Real Estate Development Co., Ltd. (Note 2) Guangdong, China Guangdong, China No 14.28
and development business
Real estate investment
Guangzhou Lihe Real Estate Development Co., Ltd. Guangdong, China Guangdong, China No 20.00
and development business
Real estate investment
Guangzhou Lvrong Real Estate Development Co., Ltd. (Note 2) Guangdong, China Guangdong, China No 16.66
and development business
Infrastructure construction
CCCC Jijiao Expressway Investment Development Co., Ltd. Hebei, China Hebei, China No 21.00
business
Real estate investment
Chongqing Jinke Zhaoji Real Estate Development Co., Ltd. Chongqing, China Chongqing, China No 45.00
and development business
Real estate investment
Chongqing Tianchengjiang Real Estate Co., Ltd. (Note 3) Chongqing, China Chongqing, China No 100.00
and development business
Infrastructure construction
Zhoukou Xintong Urban Construction Development Co., Ltd. Henan, China Henan, China No 30.00
business
Housing construction
Fernvale Lane Pte Ltd. Singapore Singapore No 20.00
business

Note 1: The Group’s shareholding ratio in some of the aforementioned joint ventures is less than 50% or more than 50%.
Major business decisions made by the board of directors of these companies or similar institutions can only be
approved after the unanimous consent of all investors; or according to the provisions of the articles of association
of these companies, major business decisions must be approved by representatives of more than two-thirds of the
voting rights. These decisions can be passed only if the Group and other shareholders agree unanimously. The
Group has no substantial control over these companies, so these companies are accounted for as joint ventures.

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X. Related party relationships and transactions (continued)

3. Joint ventures and associates (continued)

Note 2: For invested companies with a shareholding ratio of less than 20%, the Group has the right to participate in
their business decision-making by appointing directors to the board of directors of these companies, and has
a significant influence; for invested companies with a shareholding ratio of not less than 50%, According to
the provisions of the articles of association of these companies on the decision-making mechanism for major
operations and financial decisions, they cannot be controlled or jointly controlled, but the Group can only exercise
significant influence. Therefore, these companies are accounted for as associates.
Note3: Due to the acquisition of these companies’ equity or changes in the company’s articles of association this year, on
31 December 2020, the Group has included them in the scope of consolidation.
Note4: Due to the disposal of the equity of these companies this year, on 31 December 2020, the Group no longer holds
their equity.
Note5: The aforementioned joint ventures include joint ventures and their subsidiaries, and associates include associates
and their subsidiaries.

4. Other related parties

Relationship with the group

Beijing Hongde Materials Co., Ltd. Controlled by the same parent company
Beijing Zhongjian Qiming Enterprise Management Co., Ltd Controlled by the same parent company
Chengdu CSCEC Minjiang Construction Engineering Investment
Co., Ltd. Controlled by the same parent company
CSCEC Electronic Commerce Co., Ltd. Controlled by the same parent company
China Construction Environmental Energy Technology Co., Ltd. Controlled by the same parent company
China Construction Aluminum New materials Chengdu Co., Ltd. Controlled by the same parent company
China Construction Aluminum New materials Henan Co., Ltd. Controlled by the same parent company
China Construction Aluminum New materials Co., Ltd. Controlled by the same parent company
China Construction Water Affairs Environmental Protection Co., Ltd. Controlled by the same parent company
China State Construction Asset Management Co., Ltd. Controlled by the same parent company
China Automobile Material Trade Co., Ltd. Controlled by the same parent company
SIPG Bayport Terminal Co., Ltd. Controlled by another shareholder of a subsidiary of the Group
Shanggang group Ruitai Development Co., Ltd. Controlled by another shareholder of a subsidiary of the Group
Shanggang group Ruixiang Real Estate Development Co., Ltd. Controlled by another shareholder of a subsidiary of the Group
Shanghai Port Group Israel Haifa New Port Wharf Co., Ltd. Controlled by another shareholder of a subsidiary of the Group

5. Major transactions between the Group and its related parties

(1) Related party goods and services transactions

Purchase of goods and accepting services from related parties

Nature of the transaction 2020 2019
CSCEC Electronic Commerce Co., Ltd. Purchase of goods 2,556,976 480,940
Zhengzhou Yirong Yijian Supply Chain Management Co., Ltd. Purchase of goods 1,216,607 2,403,343
Hong Kong and Kowloon Concrete Co., Ltd. Purchase of goods 118,994 34,263
Macau Cement Works Co., Ltd. Purchase of goods 40,138 81,367
Haixing Materials Co., Ltd. Purchase of goods – 45,448
Purchase of goods and
Others 56,094 96,284
  Accepting services
Total 3,988,809 3,141,645

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(2) Contract engineering and projects sub-contracted out

Contract engineering
Nature of the
transaction 2020 2019
Guizhou Leirong Expressway Investment Management Co., Ltd. Contract engineering 2,180,763 360,244
Sanmenxia National Highway 310 South Moving Project Construction Management
Contract engineering 2,167,593 2,472,977
Co., Ltd.
Xuzhou Line 3 Rail Transit Investment Development Co., Ltd. Contract engineering 2,079,115 757,220
China State Construction Xi’an Urban Construction Investment Co., Ltd. Contract engineering 1,907,250 103,207
Jiqing High Speed Railway Co., Ltd. Contract engineering 1,817,344 1,654,438
Shandong Qilu Ningliang Expressway Co., Ltd. Contract engineering 1,719,796 1,429,465
Zhengzhou CSCEC Shenzhen Rail Transit Co., Ltd. Contract engineering 1,464,629 –
Shantou CSCEC new urbanization Investment Co., Ltd. Contract engineering 1,356,832 892,252
CSCEC Chengdu rail transit investment and Construction Co., Ltd. Contract engineering 1,257,119 535,535
Shangqiu Yuncheng Urban Construction Development Co., Ltd. Contract engineering 1,234,772 1,600,404
CCCC Jijiao Expressway Investment Development Co., Ltd. Contract engineering 1,182,368 717,896
Anhui Bengwu Expressway Investment Management Co., Ltd. Contract engineering 1,056,642 493,135
Hangzhou Chengtou Wulin Investment Development Co., Ltd. Contract engineering 1,052,300 –
Guizhou Zhengxi Expressway Investment Management Co., Ltd. Contract engineering 1,012,403 4,589,409
Yunnan Huali expressway investment and Development Co., Ltd. Contract engineering 968,775 1,346,324
Xi’an Chuxin investment and Construction Co., Ltd. Contract engineering 956,896 194,844
China Construction (Tianjin) Rail Transit Investment Development Co., Ltd. Contract engineering 927,374 12,662
China State Construction Zhanjiang Avenue Investment and Construction Co., Ltd. Contract engineering 845,585 113,153
Zhengzhou public Zhongcheng road and Bridge Construction Management Co., Ltd. Contract engineering 824,457 836,850
CSCEC new urbanization (Xinjiang) Investment Co., Ltd. Contract engineering 735,303 1,507,903
Mianyang Zhongjian Kefa Guanlang Road Investment and Construction Co., Ltd. Contract engineering 715,171 545,883
Quanzhou Taiwan Business Investment Zone China Construction Fifth Bureau Haiwan
Contract engineering 713,770 117,095
Avenue Investment Co., Ltd.
Qingdao China Construction Eighth Bureau Urban Investment Development Co., Ltd. Contract engineering 710,102 200,271
Zhangzhou Zhan Environmental Technology Co., Ltd. Contract engineering 698,412 64,255
China Construction Third Bureau Hubei Dadong Lake Deep Tunnel Engineering
Contract engineering 658,573 –
Construction and Operation Co., Ltd.
Nanyang Zhongjian Jinrui Urban Construction Development Co., Ltd. Contract engineering 658,305 189,882
Jiaozuo Zhongjian South to North Water Diversion Ecological Protection Construction
Contract engineering 656,458 –
and Operation Co., Ltd.
Guangzhou Lihe Real Estate Development Co., Ltd. Contract engineering 648,325 –
Jinjiang zhongyun Sports Construction Development Co., Ltd. Contract engineering 634,434 873,798
Xinjiang China Construction Urban Construction Investment Co., Ltd. Contract engineering 633,398 –
Urumqi Zhongcheng Silk Road Sports Management Co., Ltd. Contract engineering 618,701 –
CSCEC Wuhan Huangxiaohe Airport River Water Environment Comprehensive
Contract engineering 618,566 203,889
Treatment Construction and Operation Co., Ltd.
Xinyu Huancheng Road Construction Investment Co., Ltd. Contract engineering 604,429 982,913
Hebei Chenghong pipe gallery Engineering Co., Ltd. Contract engineering 595,909 424,052

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(2) Contract engineering and projects sub-contracted out (continued)

Contract engineering (continued)

Nature of the
transaction 2020 2019
Qingdao China Construction Eighth Bureau Education Development Co., Ltd. Contract engineering 546,244 133,472
China State Construction Xi’an Infrastructure Construction Investment Co., Ltd. Contract engineering 542,130 –
Ganzhou Hangyu Construction Co., Ltd. Contract engineering 529,043 159,855
China Construction Third Engineering Bureau Xianning Big Continent Lake ecological
Contract engineering 528,810 –
construction and Operation Co., Ltd.
Ulanhot Xingcai Fund Management Center (Limited Partnership) Contract engineering 506,801 83,197
Zhoukou Xintong Urban Construction Development Co., Ltd. Contract engineering 501,110 250,231
Liuzhou China Construction Steel Structure Dongcheng Exhibition Construction
Contract engineering 483,655 –
Co., Ltd.
Shanggang group Ruitai Development Co., Ltd. Contract engineering 479,639 370,230
China Construction Jingmen 207 Highway Construction Co., Ltd. Contract engineering 479,591 104,922
Chengdu Chuantou Airport Construction Co., Ltd. Contract engineering 463,962 34,586
China Construction Third Engineering Bureau Xiangyang East West axis construction
Contract engineering 442,228 –
and Operation Co., Ltd.
Qingdao Maozhang Real Estate Co., Ltd. Contract engineering 426,002 –
China Construction Third Engineering Bureau Shiyan aviation road construction and
Contract engineering 392,307 –
Operation Co., Ltd.
China Construction International (Xiangyang) Construction Co., Ltd. Contract engineering 392,295 543,526
Rizhao China Construction Eighth Bureau Culture and Technology Development
Contract engineering 373,593 –
Co., Ltd.
Urumqi Linkong Construction Infrastructure Co., Ltd. Contract engineering 372,248 –
Hubei Trading Xiangyang North Expressway Co., Ltd. Contract engineering 363,206 –
Pingdingshan City Development and Investment China Construction City First Hospital
Contract engineering 357,241 181,236
New District Management Co., Ltd.
Beijing Jianyan Real Estate Development Co., Ltd. Contract engineering 355,916 616,471
Putian Puyang University Construction Co., Ltd. Contract engineering 354,140 648,480
Jining Yanzhou Zhongjian Transportation Construction Development Co., Ltd. Contract engineering 344,209 255,717
Changsha China State Construction International Development Co., Ltd. Contract engineering 338,339 342,313
Chengdu Chuanhui Jianxing Construction Co., Ltd. Contract engineering 315,538 351,270
Zhangzhou Yingzhi Construction Development Co., Ltd. Contract engineering 282,792 447,725
Xianyi International Co., Ltd. Contract engineering 279,876 849,988
Wuhan Zhongxia Road Construction Engineering Co., Ltd. Contract engineering 243,926 636,745
CSCEC Wuhan Yangsigang Road and Bridge Construction and Operation Co., Ltd. Contract engineering 216,731 1,137,436
Xuzhou Line One Rail Transit Investment Development Co., Ltd. Contract engineering 198,010 1,612,505
China Construction Third Engineering Bureau Nanchong Environmental Construction
Contract engineering 145,802 365,308
Investment Co., Ltd.
Fast Shift Investments Limited Contract engineering 138,044 334,979
Suzhou Junda National Road 206 Construction Co., Ltd. Contract engineering 97,085 440,478
Dalian CSCEC sponge City Construction Development Co., Ltd. Contract engineering 38,782 426,129
Zunyi South Ring Expressway Development Co., Ltd. Contract engineering 31,714 687,959
Danjiangkou Haijia Construction Co., Ltd. Contract engineering 27,661 467,415

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(2) Contract engineering and projects sub-contracted out (continued)

Contract engineering (continued)

Nature of the
transaction 2020 2019
Shijiazhuang Jiaojian Expressway Construction Management Co., Ltd. Contract engineering 500 1,478,838
Huizhou Zhongjian municipal fifth Road Investment Co., Ltd. Contract engineering – 937,683
China Construction Water Affairs Environmental Protection Co., Ltd. Contract engineering – 827,344
Others Contract engineering 17,517,517 12,432,128
Total 65,018,556 50,378,122

Projects sub-contracted out

Nature of the
transaction 2020 2019
projects sub-
CSCEC-Dacheng Construction Ltd. 486,217 500,945
contracted out
projects sub-
China Construction Water Affairs Environmental Protection Co., Ltd. 122,139 417,909
contracted out
projects sub-
CSCEC Road & Bridge Group Co., Ltd. 101,518 489,148
contracted out
projects sub-
Beijing China Construction Runtong Electrical Engineering Construction Co., Ltd. 6,094 42,408
contracted out
projects sub-
Others 82,745 154,541
contracted out
Total 798,713 1,604,951

(3) Related party leasing

As lessor
Types of leased
assets 2020 2019
China Construction Water Affairs Environmental Protection Co., Ltd. Office Building 3,066 2,920
Beijing Hongde Materials Co., Ltd. Office Building 1,608 –
China Construction Environmental Energy Technology Co., Ltd. Office Building 663 –
CSCEC Electronic Commerce Co., Ltd. Office Building 338 257
Others Office Building 1,229 –
Total 6,904 3,177

As lessee
Types of leased
assets 2020 2019
Shandong Zhongcheng Machinery Leasing Co., Ltd. Machinery equipment 245,626 184,782
China Construction Aluminum New Materials Chengdu Co., Ltd. Materials 77,336 8,397
Sichuan Xijianshantui Logistics Co., Ltd. Transport equipment 58,776 55,640
Sichuan Xijianzhonghe Machinery Co., Ltd. Transport equipment 49,859 55,977
Others Office buildings, etc 62,944 43,199
Total 494,541 347,995

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(4) Related party guarantee

Offering guarantee to related parties

2020
Whether the
guarantee
Amount of Starting date of Maturity date of has been
guarantee guarantee guarantee fulfilled
Guangzhou bison Real Estate Development Co., Ltd. 186,525 11 December 2018 1 February 2021 No
Guangzhou bison Real Estate Development Co., Ltd. 142,784 26 December 2018 25 December 2021 No
Guangzhou Lihe Real Estate Development Co., Ltd. 280,000 22 April 2019 21 April 2022 No
Guangzhou Lihe Real Estate Development Co., Ltd. 180,000 29 June 2020 28 June 2023 No
Guangzhou Lihe Real Estate Development Co., Ltd. 127,880 13 July 2018 21 May 2021 No
Guangzhou Lvrong Real Estate Development Co., Ltd. 292,883 13 November 2018 29 November 2021 No
Guangzhou Lvrong Real Estate Development Co., Ltd. 98,960 30 September 2019 29 September 2022 No
Guangzhou Lvrong Real Estate Development Co., Ltd. 33,320 11 April 2019 10 April 2022 No
Changsha Xirong Real Estate Co., Ltd. 154,595 14 January 2020 9 December 2021 No
Guiheng Investment Co., Ltd. 175,000 5 July 2017 15 March 2022 No
Guiheng Investment Co., Ltd. 135,150 14 April 2017 15 March 2022 No
Guiheng Investment Co., Ltd. 82,950 20 November 2020 19 November 2025 No
Guiheng Investment Co., Ltd. 39,850 21 March 2017 15 March 2022 No
Guiheng Investment Co., Ltd. 32,500 16 March 2017 15 March 2022 No
Total 1,962,397

2019
Whether the
guarantee
Amount of Starting date of Maturity date of has been
guarantee guarantee guarantee fulfilled
Guangzhou Bison Real Estate Development Co., Ltd. 108,528 11 December 2018 1 February 2021 No
Guangzhou Bison Real Estate Development Co., Ltd. 71,393 23 July 2019 2 December 2020 No
Guangzhou Bison Real Estate Development Co., Ltd. 62,832 2 January 2019 1 January 2021 No
Guangzhou Bison Real Estate Development Co., Ltd. 49,980 22 January 2019 2 December 2020 No
Guangzhou Bison Real Estate Development Co., Ltd. 32,815 2 February 2019 1 February 2021 No
Guangzhou Bison Real Estate Development Co., Ltd. 21,420 26 December 2018 2 December 2020 No
Guangzhou Lihe Real Estate Development Co., Ltd. 575,460 13 July 2018 21 May 2021 No
Guangzhou lvrong Real Estate Development Co., Ltd. 233,240 13 November 2018 29 November 2021 No
Guangzhou lvrong Real Estate Development Co., Ltd. 99,960 30 September 2019 29 September 2022 No
Guangzhou lvrong Real Estate Development Co., Ltd. 59,976 1 March 2019 29 November 2021 No
Guangzhou lvrong Real Estate Development Co., Ltd. 49,980 11 April 2019 10 April 2022 No
Guangzhou lvrong Real Estate Development Co., Ltd. 16,660 28 June 2019 10 April 2022 No
Guiheng Investment Co., Ltd. 175,000 5 July 2017 15 March 2022 No
Guiheng Investment Co., Ltd. 135,150 14 April 2017 15 March 2022 No

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(4) Related party guarantee (continued)

Offering guarantee to related parties (continued)

2019 (continued)

Whether the
guarantee
Amount of Starting date of Maturity date of has been
guarantee guarantee guarantee fulfilled
Guiheng Investment Co., Ltd. 78,500 20 January 2017 13 October 2021 No
Guiheng Investment Co., Ltd. 52,500 16 March 2017 15 March 2022 No
Guiheng Investment Co., Ltd. 39,850 21 March 2017 15 March 2022 No
Guiheng Investment Co., Ltd. 28,150 3 January 2017 13 October 2021 No
Changsha Xirong Real Estate Co., Ltd. 150,713 16 January 2019 12 December 2024 No
Total 2,042,107

(5) Inter bank loan of related parties

Capital borrowings

2020

Borrowing amount Starting date Ending date

China State Construction Group 1,500,000 30 December 2020 29 December 2021
Xuancheng Haijia Lancheng Real Estate Co., Ltd. 16,170 30 April 2020 No fixed maturity date
Chongqing Zhongjian Hailong Liangjiang Construction
4,578 26 September 2020 No fixed maturity date
  Technology Co., Ltd.
Total 1,520,748

2019

Borrowing amount Starting date Ending date

Sunrise JV Limited 2,400,000 11 March 2019 22 August 2024
China State Construction Group 2,000,000 30 December 201919 27 December 2024
Sunrise JV Limited 885,000 11 March 2019 No fixed maturity date
Chongqing Jinke Zhaoji Real Estate Development Co., Ltd. 706,500 28 July 2019 No fixed maturity date
Shipping Hongyang Haifu (Hefei) Real Estate Development Co., Ltd. 369,160 26 June 2019 No fixed maturity date
Xi’an Dingsheng Dongyue Properties Co., Ltd. 229,987 28 January 2019 No fixed maturity date
Xi’an Jiarun Rongcheng Real Estate Co., Ltd. 200,000 27 November 2019 No fixed maturity date
Qingdao Songmao Real Estate Co., Ltd. 138,350 27 June 2019 25 November 2020
Xi’an Dingsheng Dongyue Properties Co., Ltd. 120,000 15 October 2019 No fixed maturity date
Xi’an Dingsheng Dongyue Properties Co., Ltd. 89,942 27 November 2019 No fixed maturity date
Dongguan Jiafang Real Estate Development Co., Ltd. 82,073 1 January 2019 No fixed maturity date
Qingdao Fanghui Real Estate Co., Ltd. 51,154 31 May 2019 30 May 2020
Qingdao Fangchuan Real Estate Co., Ltd. 50,506 27 June 2019 26 June 2020
China Resources (Taiyuan) Development Co., Ltd. 50,000 30 August 2019 No fixed maturity date
Qingdao Fangchen Real Estate Co., Ltd. 40,989 30 April 2019 29 April 2020
Qingdao Fangchuan Real Estate Co., Ltd. 11,050 24 May 2019 23 May 2020
Total 7,424,711

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties

(5) Inter bank loan of related parties (continued)

Fund lent

2020
Loan amount Starting date Ending date
China State Construction Group 2,500,000 9 September 2020 8 September 2021
China State Construction Group 2,200,000 9 September 2020 8 September 2021
China State Construction Group 800,000 16 December 2020 15 December 2021
Guangzhou Hong Land Co., Ltd. 612,997 18 August 2020 18 August 2022
Top Colour Development Limited 527,080 22 January 2020 No fixed maturity date
Ezhou Chuanggu Real Estate Development Co., Ltd. 460,565 13 January 2020 13 January 2022
Chongqing Qingneng Yuehe Real Estate Co., Ltd. 390,979 8 January 2020 15 April 2021
Wuhan Zhongjian Yipin Zhaoying Real Estate Co., Ltd. 301,688 3 August 2020 2 August 2021
Chengdu Beichen Tianchen Real Estate Co., Ltd. 292,127 10 June 2020 10 June 2022
China Construction Water Affairs Environmental Protection Co., Ltd. 250,000 16 April 2020 15 April 2021
Xinjiang China Construction Urban Construction Investment Co., Ltd. 229,558 16 December 2020 15 June 2021
Zhengzhou Xiangyue Real Estate Development Co., Ltd. 203,518 12 October 2020 12 October 2021
China State Construction Group 200,000 16 March 2020 16 June 2020
China State Construction Group 200,000 15 June 2020 30 June 2020
China Construction Water Affairs Environmental Protection Co., Ltd. 200,000 25 December 2020 15 March 2021
Wuhan Chenzhan Real Estate Development Co., Ltd. 150,854 8 September 2020 8 September 2022
Changsha Rail China Construction Xinhe Real Estate Co., Ltd. 126,917 1 January 2020 24 December 2021
Wuhan Chenfa Real Estate Development Co., Ltd. 126,560 8 September 2020 8 September 2022
Fernvale Lane Pte Ltd. 118,866 4 June 2020 31 December 2025
TEDA Group Co., Ltd. 95,230 14 August 2020 No fixed maturity date
Nanjing Guancheng Hengrui Real Estate Co., Ltd. 82,500 8 May 2020 31 December 2020
Overseas Hongyang 75,026 19 October 2020 18 October 2023
Putian Zhongjian Mulan Construction Development Co., Ltd. 56,351 30 December 2020 No fixed maturity date
Ezhou Chuanggu Real Estate Development Co., Ltd. 50,000 13 January 2020 13 January 2021
Jinjiang zhongyun Sports Construction Development Co., Ltd. 40,000 15 January 2020 No fixed maturity date
Nanjing Guancheng Hengrui Real Estate Co., Ltd. 23,100 8 September 2020 31 December 2020
CSCEC Electronic Commerce Co., Ltd. 20,000 12 May 2020 11 May 2021
Jinan Hongbi Real Estate Co., Ltd. 20,000 1 January 2020 30 June 2020
Nanjing Guancheng Hengrui Real Estate Co., Ltd. 19,800 25 December 2020 31 December 2020
Zhangzhou China Merchants Economic and Technological
Development Zone China State Construction Infrastructure 19,344 23 November 2020 No fixed maturity date
Investment and Development Co., Ltd.
Liupanshui urban pipe gallery construction and Development
19,064 22 December 2020 21 December 2021
Investment Co., Ltd.
Chongqing Zhongjian Hailong Liangjiang Construction Technology
13,398 31 January 2020 No fixed maturity date
Co., Ltd.
China Ge Yongmao (Suzhou) Real Estate Development Co., Ltd. 12,500 1 October 2020 1 December 2021

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(5) Inter bank loan of related parties (continued)

Fund lent (continued)

2020 (continued)

Loan amount Starting date Ending date

Putian Puyang University Construction Co., Ltd. 10,000 16 November 2020 No fixed maturity date
China construction aluminum new materials Chengdu Co., Ltd. 10,000 22 June 2020 21 June 2021
China construction aluminum new materials Henan Co., Ltd. 10,000 4 August 2020 3 August 2021
China construction aluminum new materials Chengdu Co., Ltd. 10,000 9 December 2020 8 December 2021
Zhangzhou China Merchants Economic and Technological
Development Zone China State Construction Infrastructure 2,000 1 October 2020 No fixed maturity date
Investment and Development Co., Ltd.
Zhangzhou China Merchants Economic and Technological
Development Zone China State Construction Infrastructure 1,000 1 August 2020 No fixed maturity date
Investment and Development Co., Ltd.
Total 10,534,386

2019
Loan amount Starting date Ending date
Clear Elegant Limited 4,235,495 3 December 2019 No fixed maturity date
Luminous Dream Limited 2,637,429 15 April 2019 No fixed maturity date
China State Construction Group 2,630,000 10 September 2019 9 September 2020
Shanghai Fuhong Real Estate Co., Ltd. 2,143,194 29 September 2019 No fixed maturity date
China State Construction Group 2,000,000 25 September 2019 30 September 2019
China State Construction Group 1,800,000 25 September 2019 27 September 2019
Gainable Development Limited 1,360,948 15 August 2019 No fixed maturity date
Marble Edge Limited 1,213,622 29 May 2019 No fixed maturity date
Wuhan Hongtai Hongli Zhongjian Yipin Real Estate Co., Ltd. 1,003,971 22 August 2019 18 June 2020
Xianyi International Co., Ltd. 459,325 1 July 2019 No fixed maturity date
Xuancheng Haijia Lancheng Real Estate Co., Ltd. 435,064 20 February 2019 No fixed maturity date
Shanghai Xingxin Real Estate Development Co., Ltd. 403,972 1 January 2019 31 May 2020

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(5) Inter bank loan of related parties (continued)

Fund lent (continued)

2019 (continued)

Loan amount Starting date Ending date

China State Construction Xi’an Infrastructure Construction
378,882 28 June 2019 No fixed maturity date
Investment Co., Ltd.
Xuancheng Haijia Lancheng Real Estate Co., Ltd. 318,500 1 July 2019 No fixed maturity date
Wuhan Zhongjian Yipin Zhaoying Real Estate Co., Ltd. 242,634 22 August 2019 2020December 31
Tianjin Shunji Real Estate Co., Ltd. 211,418 1 July 2019 No fixed maturity date
Tianjin Chuangliang Investment Management Co., Ltd. 132,600 1 July 2019 No fixed maturity date
Anhui Bengwu Expressway Investment Management Co., Ltd. 131,800 11 July 2019 No fixed maturity date
Jinjiang Zhongyun Sports Construction Development Co., Ltd. 120,000 1 July 2019 No fixed maturity date
China State Construction Xi’an Infrastructure Construction
101,000 1 July 2019 No fixed maturity date
Investment Co., Ltd.
Jinjiang Zhongyun Sports Construction Development Co., Ltd. 90,000 25 October 2019 No fixed maturity date
China State Construction Xi’an Infrastructure Construction
87,500 21 January 2019 No fixed maturity date
Investment Co., Ltd.
Overseas Hongyang 78,230 1 January 2019 No fixed maturity date
Jinjiang Zhongyun Sports Construction Development Co., Ltd. 70,000 24 December 2019 No fixed maturity date
China Construction Water Affairs Environmental Protection Co., Ltd. 50,000 27 December 2019 25 December 2020
Jinan Hongbi Real Estate Co., Ltd. 45,000 28 August 2019 No fixed maturity date
China State Construction Xi’an Infrastructure Construction
42,098 25 June 2019 No fixed maturity date
Investment Co., Ltd.
Jinjiang Zhongyun Sports Construction Development Co., Ltd. 40,000 25 January 2019 No fixed maturity date
Xiamen Yongjing Bay Real Estate Co., Ltd. 32,440 31 December 2019 No fixed maturity date
Xianyi International Co., Ltd. 30,187 1 January 2019 31 May 2020
Jinan Taihui Real Estate Development Co Ltd 23,100 17 January 2019 No fixed maturity date
Xuchang Chenheng Real Estate Co., Ltd. 20,000 25 January 2019 25 January 2020
Anhui Bengwu Expressway Investment Management Co., Ltd. 8,843 13 September 2019 No fixed maturity date
Anhui Bengwu Expressway Investment Management Co., Ltd. 8,113 25 November 2019 No fixed maturity date
Anhui Bengwu Expressway Investment Management Co., Ltd. 7,663 31 December 2019 No fixed maturity date
Fuzhou Xinzhi Investment Development Co., Ltd. 5,000 23 November 2019 No fixed maturity date
Fuzhou Xinzhi Investment Development Co., Ltd. 5,000 31 December 2019 No fixed maturity date
Xiamen Yongjing Bay Real Estate Co., Ltd. 3,320 10 September 2019 No fixed maturity date
Anhui Bengwu Expressway Investment Management Co., Ltd. 888 31 January 2019 No fixed maturity date
Total 22,607,236

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(6) A takes deposits

2020

Increase Decrease
1 January in the in the 31 December
2020 current year current year 2020
CSCEC Electronic Commerce Co., Ltd. 315,902 2,550,191 (1,574,597) 1,291,496
China Construction Water Affairs Environmental Protection
Co., Ltd. 438,078 2,728,826 (2,492,353) 674,551
China State Construction Group 14,136 23,307,368 (23,086,821) 234,683
Beijing Zhongjian Qiming Enterprise Management Co., Ltd. 34,489 176,486 (135,331) 75,644
China construction aluminum new materials Chengdu Co., Ltd. – 87,306 (75,948) 11,358
Chengdu CSCEC Minjiang Construction Engineering
Investment Co., Ltd. 2,357 117,117 (109,953) 9,521
China State Construction Asset Management Co., Ltd. – 7,008 (1,160) 5,848
China construction aluminum new materials Co., Ltd. 10,023 3,031 (8,500) 4,554
China Construction Environmental Energy Technology Co., Ltd. – 2,000 – 2,000
China construction aluminum new materials Henan Co., Ltd. – 56,479 (54,533) 1,946
China Construction Haoyun Co., Ltd. 100,000 154 (99,559) 595
CSCEC Dacheng Construction Co., Ltd. 52,498 99,036 (151,169) 365
Nanjing Zhongjian Rural Tourism Construction Investment
Co., Ltd. 1,110 29,821 (30,633) 298
China Automobile Material Trade Co., Ltd. 582 2 (402) 182
Nanjing CSCEC Gubei Urban Development Co., Ltd. 6,781 4,010 (10,619) 172
Total 975,956 29,168,835 (27,831,578) 2,313,213

2019
Increase Decrease
1 January in the in the 31 December
2019 current year current year 2019
China Construction Water Affairs Environmental Protection
Co., Ltd. 282,252 1,510,711 (1,354,885) 438,078
CSCEC Electronic Commerce Co., Ltd. 129,233 703,969 (517,300) 315,902
China Construction Haoyun Co., Ltd. – 100,000 – 100,000
CSCEC Dacheng Construction Co., Ltd. – 52,498 – 52,498
Beijing Zhongjian Qiming Enterprise Management Co., Ltd. 540,000 54,489 (560,000) 34,489
China State Construction Group 407,401 47,291,447 (47,684,712) 14,136
CSCEC aluminum new materials Co., Ltd. – 56,023 (46,000) 10,023
Nanjing CSCEC Gubei Urban Development Co., Ltd. – 2,398,000 (2,391,219) 6,781
Chengdu CSCEC Minjiang Construction Engineering
Investment Co., Ltd. – 3,407 (1,050) 2,357
Nanjing Zhongjian Rural Tourism Construction Investment
Co., Ltd. – 100,861 (99,751) 1,110
China Automobile Material Trade Co., Ltd. – 57,275 (56,693) 582
Total 1,358,886 52,328,680 (52,711,610) 975,956

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X. Related party relationships and transactions (continued)

5. Major transactions between the Group and its related parties (continued)

(7) Transfer of related parties assets

Nature of the
transaction 2020 2019
Overseas Hongyang Trade mark use right 178,000 174,200

(8) Other related parties transactions

2020 2019
Key management’s remuneration 6,325 8,808

6. Amounts due from related parties

(1) Notes receivable

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
Qingdao Fangqian Real Estate Co., Ltd. 60,418 – 50,930 –
Changsha China Construction Future Technology
28,000 – – –
  City Investment Co., Ltd.
China Construction Water Affairs Environmental
21,000 – – –
  Protection Co., Ltd.
Qingdao Fanghui Real Estate Co., Ltd. 14,565 – – –
Others 14,101 – – –
Total 138,084 – 50,930 –

(2) Accounts receivable

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
Guizhou Leirong Expressway Investment Management Co., Ltd. 794,470 (35,751) 371,768 –
China Construction (Tangshan Caofeidian) Engineering
707,622 (15,846) 651,423 (6,154)
Construction Co., Ltd.
CSCEC new urbanization (Xinjiang) Investment Co., Ltd. 661,443 (23,990) 1,168,242 (13,642)
Xuancheng Haijia Lancheng Real Estate Co., Ltd. 621,229 – 82,921 –
China State Construction Xi’an Infrastructure Construction
579,122 (72,606) – –
Investment Co., Ltd.
Xuzhou Line 1 Rail Transit Investment Development Co., Ltd. 508,188 (50,819) 722,021 (32,491)
China Construction International (Xiangyang) Construction
488,312 – 336,349 –
Co., Ltd.
Shijiazhuang Jiaojian Expressway Construction Management
415,308 (125,448) 518,241 (103,714)
Co., Ltd.
Jiqing High Speed Railway Co., Ltd. 258,102 (15,955) 145,360 (6,541)
Xuzhou Metro Line Three Investment Development Co., Ltd. 256,857 (24,812) 240,975 (10,844)
Anhui Bengwu Expressway Investment Management Co., Ltd. 249,790 (6,187) 289,727 (9,934)
Zhaotong Zhongjian Construction Investment Development
248,403 (37,467) 205,297 (37,467)
Co., Ltd.
Shangang group Ruitai Development Co., Ltd. 227,629 (53,143) 435,363 (46,321)
Liupanshui Urban Pipe Gallery Construction and
220,819 (11,041) 333,140 (6,663)
Development Investment Co., Ltd.
China Construction Water Affairs Environmental Protection
184,464 – 297,404 –
Co., Ltd.

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X. Related party relationships and transactions (continued)

6. Amounts due from related parties (continued)

(2) Accounts receivable (continued)

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
Danjiangkou Haijia Construction Co., Ltd. 184,441 – 308,300 –
Changsha Zhongjian International Development 168,568 – 131,909 –
Chengdu Changtou Dongjin Construction Co., Ltd. 167,903 (3,358) – –
Cangzhou CSCEC Bohai investment Logistics Park
146,521 (14,652) 146,521 (11,669)
Construction Development Co., Ltd.
Suzhou Xinghui West Ring Road Construction Co., Ltd. 146,168 (6,578) 350,728 (15,783)
Cangzhou Bohai New Area China Construction Port
134,455 (68,706) 151,125 (8,363)
Construction Management Co., Ltd.
Changsha Yida Chuangzhi Property Development Co., Ltd. 123,500 – 60,748 –
Hanzhong Xinghan City Parking Lot Construction Management
118,907 (2,498) – –
Co., Ltd.
Dalian CSCEC sponge City Construction Development Co., Ltd. 112,665 (8,394) 79,693 (3,586)
Liupanshui Dongda highway investment and Development
109,562 (10,956) 129,562 (5,837)
Co., Ltd.
Shangang group Ruixiang Real Estate Development Co., Ltd. 100,634 (4,529) 66,831 (3,007)
Dazhou Dahuan Development Management Co., Ltd. 98,299 (4,915) 157,799 (3,156)
CCCC Jijiao Expressway Investment Development Co., Ltd. 7,635 (344) 152,126 (8,504)
Sanmenxia National Highway 31-0 South Moving Project
– – 495,466 (4,955)
Construction Management Co., Ltd.
Xianyi International Co., Ltd. – – 156,687 –
Others 1,619,722 (112,408) 2,434,586 (127,337)
Total 9,660,738 (710,403) 10,620,312 (465,968)

(3) Other receivables

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
China Construction Third Bureau Ezhou Guang’an Real
1,596,707 (63,867) – –
Estate Development Co., Ltd.
Foshan Zhongjian Yipin Pengyue Real Estate Co., Ltd. 1,135,984 (11,360) – –
Guangzhou XingLv Real Estate Development Co., Ltd. 726,454 (29,068)
Suzhou Fu Real Estate Co., Ltd. 645,036 (25,775) – –
Guangzhou fuchuang Real Estate Development Co., Ltd. 595,777 (23,831) – –
Ezhou Zhongjian Yipin Lanyue Real Estate Co., Ltd. 419,569 (4,196) – –
Foshan Jiantou Zhongjian Yipin Real Estate Co., Ltd. 225,249 (16,875) – –
China Construction Third Bureau Rongchang Chengdu Tianfu
181,287 (181) – –
New District Construction Investment Co., Ltd.
Zhengzhou Yirong Yijian Supply Chain Management Co., Ltd. 152,449 (6,260) 220,642 (9,500)
Dongguan Zhonghai Century City Education Technology
145,986 (11,057) 180,486 (11,059)
Development Co., Ltd.
Sichuan Huayou Zhonglan Energy Co., Ltd. 100,000 (100,000) – –
Suzhou Junda National Road 206 Construction Co., Ltd. 91,804 (7,824) 91,804 (3,686)
Baoding China Construction Industrial Investment Co., Ltd. 85,000 (3,400) 17 (1)
Xiamen Haitou Construction Technology Co., Ltd. 74,250 (2,228) – –

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X. Related party relationships and transactions (continued)

6. Amounts due from related parties (continued)

(3) Other receivables (continued)

31 December 2020 31 December 2019

Carrying Impairment Carrying Impairment
amount allowance amount allowance
China Construction Third Engineering Bureau Xiangyang
53,242 (4,259) – –
East West Axis Construction and Operation Co., Ltd.
Shantou CSCEC new urbanization Investment Co., Ltd. 52,920 (10,584) 52,920 (3,704)
China Construction Technology Jingmen Co., Ltd. 50,886 (509) – –
CSCEC Road & Bridge Group Co., Ltd. 50,806 (4,328) 8,456 (266)
Rizhao Zhongjian Transportation Service Co., Ltd. 50,000 (4,000) 60,636 (2,425)
Liupanshui Urban Pipe Gallery Construction and
42,165 (1,311) – –
Development Investment Co., Ltd.
China State Construction Technology Hubei Co., Ltd. 41,632 (419) – –
Xuchang Chenheng Real Estate Co., Ltd. 26,891 (1,076) 115,073 (6,712)
China Construction Third Bureau Shengshi Jingzhou
6,468 (6,449) 418,200 (12,546)
Real Estate Development Co., Ltd.
Huizhou Zhongjian municipal fifth Road Investment Co., Ltd. – – 500,000 (100)
Panzhihua China Construction Third Bureau Government
528 (1) 68,722 (69)
Service Center Project Construction Development Co., Ltd.
Rizhao China Construction Eighth Bureau Culture and
– – 450,000 (18,000)
Technology Development Co., Ltd.
Xinggui Investment Co., Ltd. – – 237,500 –
Chongqing Tianchengjiang Real Estate Co., Ltd. – – 106,889 (8,373)
Dalian CSCEC sponge City Construction Development Co., Ltd. – – 90,000 (2,700)
Others 407,869 (24,950) 251,342 (8,558)
Total 6,958,959 (363,808) 2,852,687 (87,699)

(4) Contract assets

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
Guizhou Zhengxi Expressway Investment Management Co., Ltd. 848,360 (3,823) 707,917 (3,503)
Hebei Xiong’an Citizen Service Center Co., Ltd. 514,776 (3,646) 482,663 (500)
Sanmenxia National Highway 31-0 South Moving Project
446,269 (6,008) 186,733 (5,336)
Construction Management Co., Ltd.
Hebei Chenghong pipe gallery Engineering Co., Ltd. 335,659 (7,320) 204,003 (2,341)
CSCEC new urbanization (Xinjiang) Investment Co., Ltd. 294,093 (1,914) 330,637 (1,945)
Zunyi South Ring Expressway Development Co., Ltd. 253,247 (825) – –
Jiqing High Speed Railway Co., Ltd. 237,861 (1,431) 226,489 (738)
Liupanshui Urban Pipe Gallery Construction and
155,511 (512) – –
Development Investment Co., Ltd.
Suzhou Junda National Road 2006 Construction Co., Ltd. 143,520 (823) – –
Luzhou Yangtze River Second Bridge Construction Co., Ltd. 125,191 (10,478) – –
Guangzhou Lihe Real Estate Development Co., Ltd. 112,526 (556) 49,026 (270)
Suzhou Xinghui West Ring Road Construction Co., Ltd. 102,620 (416) 103,072 (442)
Xinjiang Zhongjian Construction Investment Development
89,110 (516) – –
Co., Ltd.
Zhaotong Zhongjian Construction Investment Development
85,006 (16,971) 78,776 (23,264)
Co., Ltd.

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X. Related party relationships and transactions (continued)

6. Amounts due from related parties (continued)

(4) Contract assets (continued)

31 December 2020 31 December 2019

Carrying Impairment Carrying Impairment
amount allowance amount allowance
Shantou CSCEC new urbanization Investment Co., Ltd. 84,678 (706) – –
Mianyang Zhongjian Kefa Guanlang Road Investment and
83,421 (458) 88,876 (668)
Construction Co., Ltd.
Wuhan Yangsigang Road and Bridge Construction and
82,194 (252) – –
Operation Co. Ltd.
Haikou Qiyue Urban Construction Co., Ltd. 80,557 (376) 100,680 (645)
Shangang group Ruitai Development Co., Ltd. 72,396 (298) 17,999 (138)
Hubei Trading Xiangyang North Expressway Co., Ltd. 70,591 – – –
CITIC Polytec Real Estate (Foshan) Co., Ltd. 67,306 (484) 51,360 (411)
Shandong Ningliang Expressway Co., Ltd. 66,004 (330) – –
Cangzhou CSCEC Bohai investment Logistics Park
63,744 (247) – –
Construction Development Co., Ltd.
Panjin Xinjian Construction Co., Ltd. 62,345 (47,778) 4,981 (25)
China Construction Third Bureau Rongchang Chengdu Tianfu
62,005 (62) – –
New District Construction Investment Co., Ltd.
Zhengzhou Public Zhongcheng Road and Bridge Construction
61,619 (261) 90,280 (451)
Management Co., Ltd.
Nanjing Kang Real Estate Development Co., Ltd. 58,282 (264) – –
Tianjin Shunji Real Estate Co., Ltd. 56,037 (280) – –
Yinchuan Shenyang Road Underground Comprehensive Pipe
51,980 (176) – –
Gallery Construction Management Co., Ltd.
CSCEC Chengdu rail transit investment and Construction
50,968 (1,689) – –
Co., Ltd.
China Construction Haoyun Co., Ltd. 38,197 (257) 171,197 (1,006)
Shenzhen Shenshan special cooperation zone Zhongpu
23,490 (153) 219,214 (993)
Infrastructure Investment Co., Ltd.
Shijiazhuang Jiaojian Expressway Construction Management
3,057 (15) 77,770 (61,237)
Co., Ltd.
Shangqiu Xinhangcheng Development and Construction
– – 104,312 (495)
Management Co., Ltd.
Others 1,290,133 (53,594) 1,408,845 (54,075)
Total 6,172,753 (162,919) 4,704,830 (158,483)

(5) Other current assets

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
China State Construction Group 5,500,000 (161,700) 2,630,000 (77,322)
Tianjin Chuangqing Investment Management Co., Ltd. 1,179,001 – – –
Tongxiang Haoli Enterprise Management Co., Ltd. 874,340 – 961,840 –
Leading Investment Co., Ltd. 821,098 – – –
Xinggui Investment Co., Ltd. 778,275 – 813,424 –
Xuchang Chenheng Real Estate Co., Ltd. 751,869 – 809,399 –
China Ge Yongmao (Suzhou) Real Estate Development
541,622 (81,654) 529,122 (26,041)
Co., Ltd.
Top Colour Development Limited 527,183 – – –
China State Construction Xi’an Infrastructure Construction
469,480 (32,864) 609,480 (22,324)
Investment Co., Ltd.

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X. Related party relationships and transactions (continued)

6. Amounts due from related parties (continued)

(5) Other current assets (continued)

31 December 2020 31 December 2019

Carrying Impairment Carrying Impairment
amount allowance amount allowance
China Construction Water Affairs Environmental Protection
450,000 (13,230) – –
Co., Ltd.
Tianjin Chuangliang Investment Management Co., Ltd. 449,219 – 449,216 –
Jinjiang zhongyun Sports Construction Development Co., Ltd. 326,500 – 320,000 (8,800)
Tianjin Shun Ji Property Co., Ltd. 302,668 (49,364) 339,918 (34,729)
Jinyu Jiaxing Nanjing Real Estate Development Co., Ltd. 300,000 (14,400) 300,000 (14,400)
Shanghai Jiasheng Real Estate Development Co., Ltd. 235,590 – 801,723 –
Overseas Hongyang 200,404 – 585,712 –
Tianjin Wanjiang Real Estate Co., Ltd. 189,084 – 213,760 –
Jinan Hongbi Real Estate Co., Ltd. 35,361 (2,029) 225,361 (16,229)
Shangqiu Yunheng Urban Construction Development Co., Ltd. 10,967 – 210,967 (6,329)
Shanghai Fuhong Real Estate Co., Ltd. – – 2,143,194 (85,728)
Wuhan Hongtai Hongli Zhongjian Yipin Real Estate Co., Ltd. – – 1,003,971 (1,004)
Xuancheng Haijia Lancheng Real Estate Co., Ltd. – – 695,298 –
Wuhan Zhongjian Yipin Zhaoying Real Estate Co., Ltd. – – 242,634 (312)
Longguang International Co., Ltd. – – 210,181 –
Others 1,021,083 (130) 1,299,026 (17,193)
Total 14,963,744 (355,371) 15,394,226 (310,411)

(6) Long-term receivables

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
Hubei Trading Xiangyang North Expressway Co., Ltd. 20,000 (60) – –
Sanmenxia National Highway 31-0 South Moving Project
6,000 (600) – –
Construction Management Co., Ltd.
Xuzhou Metro Line Three Investment Development Co., Ltd. 4,000 (80) – –
Tianjin Yingchao Real Estate Development Co., Ltd. 1,424 (1) – –
Cangzhou CSCEC Bohai investment Logistics Park
1,413 (28) – –
Construction Development Co., Ltd.
Qingdao Yufu Real Estate Co., Ltd. – – 216,840 (217)
Qingdao Runfu Real Estate Co., Ltd. – – 96,855 (97)
Others 1,763 (74) – –
Total 34,600 (843) 313,695 (314)

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X. Related party relationships and transactions (continued)

6. Amounts due from related parties (continued)

(7) Debt Investments

31 December 2020 31 December 2019
Carrying Impairment Carrying Impairment
amount allowance amount allowance
Clear Elegant Limited 2,545,359 – 4,235,495 –
Luminous Dream Limited 1,639,100 – 2,637,429 –
TEDA Group Co., Ltd. 1,673,702 – 1,643,465 –
Gainable Development Limited 1,364,837 – 1,360,948 –
Marble Edge Limited 1,208,615 – 1,213,622 –
Qingdao Changming Real Estate Co., Ltd. 841,453 – 882,330 –
Guangzhou SuiHai Real Estate Co., Ltd. 833,750 – 1,133,750 –
Beijing Nanyue Real Estate Development Co., Ltd. 729,714 – 717,487 –
Hing Chong Enterprise Co., Ltd. 633,284 – 672,572 –
Beijing Jinliang Xingye Real Estate Development Co., Ltd. 626,092 – 665,981 –
Guangzhou Hong Land Co., Ltd. 616,326 – – –
Dazhou Dahuan Development Management Co., Ltd. 612,997 – 719,272 –
Ezhou Chuanggu Real Estate Development Co., Ltd. 510,565 – – –
Xianyi International Co., Ltd. 405,437 – 483,962 –
Chongqing Qingneng Yuehe Real Estate Co., Ltd. 390,979 (1,173) – –
Xiamen Yijun Real Estate Co., Ltd. 375,650 – 805,938 –
Jinan Taihui Real Estate Development Co Ltd. 374,167 – 539,167 –
Guiheng Investment Co., Ltd. 336,833 – 473,088 –
Guangzhou Zengcheng Runyu Estate Co., Ltd. 315,600 – 345,600 –
Wuhan Zhongjian Yipin Zhaoying Real Estate Co., Ltd. 301,688 (30) – –
Xiamen Yongjing Bay Real Estate Co., Ltd. 299,202 – 323,400 –
Changsha Yida Chuangzhi Property Development Co., Ltd. 288,835 – 274,103 –
China State Construction Xi’an Infrastructure Construction
270,264 (2,703) 270,264 (2,703)
Investment Co., Ltd. (Note)
Chengdu Beichen Tianchen Real Estate Co., Ltd. 222,144 – – –
Jiangmen Pengjiang Hebang Real Estate Development
221,126 – 221,126 –
Co., Ltd.
Zhengzhou Xiangyue Real Estate Development Co., Ltd. 216,882 – – –
Xiangtan Haijia Construction Co., Ltd. 193,223 – 183,700 –
Wuhan Chenzhan Real Estate Development Co., Ltd. 154,170 – – –
Beijing Huiguang Enterprise Management Co., Ltd. 143,688 – – –
Wuhan Chenfa Real Estate Development Co., Ltd. 129,377 – – –
Changsha Rail China Construction Xinhe Real Estate Co., Ltd. 126,917 (381) – –
Sanya Bi Hai Jin Cheng Business Management Co., Ltd. 84,158 – 446,258 –
Others 868,613 (4,091) 1,004,516 (12,328)
Total 19,554,747 (8,378) 21,253,473 (15,031)

Note: As at 31 December 2020, the entrusted loan amounted RMB270,264 thousand lent to a joint venture of the Group,
China State Construction Xi’an Infrastructure Construction Investment Co., Ltd. (31 December 2019: RMB270,264
thousand) and China State Construction Xi’an Urban Construction Investment Co., Ltd., an associate of the Group,
amounted RMB100,659 thousand (31 December 2019: RMB100,659 thousand), are presented in the entrusted
loans of Note V. 12.

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X. Related party relationships and transactions (continued)

7. Payables to related parties

(1) Accounts payable

31 December 2020 31 December 2019
CSCEC Electronic Commerce Co., Ltd. 760,488 264,269
Hongyang Haifu (Hefei) Real Estate Development Co., Ltd. 293,810 –
CSCEC-Dacheng Construction Ltd. 209,736 130,934
CSCEC Road & Bridge Group Co., Ltd. 193,738 386,450
China Construction Water Affairs Environmental Protection Co., Ltd. 166,239 –
Zhengzhou Yirong Yijian Supply Chain Management Co., Ltd. 161,059 1,244,520
Qufu Nishan cultural tourism real estate Co., Ltd. 154,800 –
Shandong Zhongjian Zhongli Equipment Leasing Co., Ltd. 98,509 16
China Construction aluminum new materials Chengdu Co., Ltd. 63,682 16,176
Beijing China Construction Zhongchao Concrete Co., Ltd. 61,050 40,110
Sichuan Xijianshantui Logistics Co., Ltd. 44,968 24,433
Beijing China Construction Runtong Electrical Engineering
35,031 37,695
Construction Co., Ltd.
China Construction Environmental Energy Technology Co., Ltd. 32,858 –
Shandong Zhongjian Material Equipment Co., Ltd. 29,753 657
Sichuan Xijianzhonghe Machinery Co., Ltd. 29,053 37,882
China Construction Zhengda Technology Co., Ltd. 26,623 28,598
Shandong Zhongcheng Machinery Leasing Co., Ltd. 13,925 116,444
China Construction Technology Jingmen Co., Ltd. 6,515 35,646
Others 109,153 329,286
Total 2,490,990 2,693,116

(2) Other Payables

31 December 2020 31 December 2019
CSCEC Chengdu rail transit investment and Construction Co., Ltd. 3,304,091 –
Nanjing Zhongjian Rural Tourism Construction Investment Co., Ltd. 1,111,063 –
Nanjing CSCEC Gubei Urban Development Co., Ltd. 930,115 –
Xi’an Jiarun Rongcheng Real Estate Co., Ltd. 895,474 200,000
Sunrise JV Limited 881,655 924,473
Xinggui Investment Co., Ltd. 762,028 995,000
Guangzhou Lihe Real Estate Development Co., Ltd. 716,735 –
Hing Chong Enterprise Co., Ltd. 655,000 765,000
Chongqing Jinke Zhaoji Real Estate Development Co., Ltd. 614,250 706,500
Leading Investment Co., Ltd. 593,550 –
Qingdao Yuefu Real Estate Co., Ltd. 280,026 –
Qingdao Zefu Real Estate Co., Ltd. 199,549 –
Shantou CSCEC new urbanization Investment Co., Ltd. 191,212 –
China Construction Haijia (Foshan) Investment and Construction Co., Ltd. 184,000 –

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X. Related party relationships and transactions (continued)

7. Payables to related parties (continued)

(2) Other Payables (continued)

31 December 2020 31 December 2019

Xi’an Hehui Xingshang Properties Co., Ltd. 183,765 550,000
Guangzhou lvrong Real Estate Development Co., Ltd. 167,433 –
China State Construction Group 163,349 –
Qingdao tengmao Real Estate Co., Ltd. 138,818 –
China Shipping Hecai (Beijing) Equity Investment Fund Management
132,389 –
Co., Ltd.
Suzhou Mudu Zhongxin land Co., Ltd. 112,278 222,021
Guiheng Investment Co., Ltd. 105,050 410,000
China Resources (Tai) Land Co., Ltd. 100,000 275,000
Shandong China Overseas Huachuang Real Estate Co., Ltd. 83,026 498,026
Dongguan Jiafang Real Estate Development Co., Ltd. 71,793 382,810
Young Yue Investment Co., Ltd. 22,500 1,261,544
Zhengzhou Yirong Yijian Supply Chain Management Co., Ltd. 4,618 387,848
CSCEC Wuhan Yangsigang Road and Bridge Construction and
3,415 254,930
Operation Co., Ltd.
Xi’an Dingsheng Dongyue Properties Co., Ltd. – 639,942
China Shipping Hongyang Haifu (Hefei) Real Estate Development
– 469,363
Co., Ltd.
Longguang International Co., Ltd. – 393,596
Zhengzhou Public Zhongcheng Road and Bridge Construction
– 222,488
Management Co., Ltd.
Others 2,092,041 2,303,737
Total 14,699,223 11,862,278

(3) Contract Liabilities

31 December 2020 31 December 2019
CCCC Jijiao Expressway Investment & Development Co., Ltd. 1,075,022 1,003,852
Guizhou Leirong Expressway Investment Management Co., Ltd. 1,331,887 746,159
Yunnan Huali Expressway Investment and Development Co., Ltd. 911,163 –
Wuhan Huangxiaohe Airport River Environment Comprehensive
676,033 434,611
Treatment Construction Operation Co., Ltd.
Jiqing High Speed Railway Co., Ltd. 626,044 11,647
Xuzhou Line 1 Rail Transit Investment Development Co., Ltd. 354,701 186,597
China Construction Third Engineering Bureau Nanchong Environmental
256,086 –
Construction Investment Co., Ltd.
Zhoukou Xintong Urban Construction Development Co., Ltd. 231,299 –
Wenzhou China Construction Steel Structure Olympic Sports Project
225,681 –
Management Co., Ltd.
China Construction Third Engineering Bureau Jingzhou Huanchang Lake
207,539 147,784
Construction and Operation Co., Ltd.
Jiaozuo Zhongjian South to North Water Diversion Ecological Protection
202,679 –
Construction and Operation Co., Ltd.
China State Construction Xi’an Infrastructure Construction Investment
198,765 –
Co., Ltd.
Changsha CSCEC Chengtou Pipe Well Development Investment Co., Ltd. 188,523 284,268

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X. Related party relationships and transactions (continued)

7. Payables to related parties (continued)

(3) Contract Liabilities (continued)

31 December 2020 31 December 2019

China State Construction Xi’an Urban Construction Investment Co., Ltd. 183,505 –
China Construction Third Engineering Bureau Dazhou Lake Ecological
167,794 463,975
Construction and Operation Co., Ltd.
China Construction Third Bureau Hubei Dadong Lake Deep Tunnel
166,665 –
Engineering Construction and Operation Co., Ltd.
Chengdu Changtou Dongjin Construction Co., Ltd. 148,417 –
Hebei Chenghong pipe gallery Engineering Co., Ltd. 141,200 –
SIPG Bayport Terminal Co., Ltd. 127,652 –
Beijing National Alpine Skiing Co., Ltd. 125,462 62,706
Hangzhou Chengtou Wulin Investment Development Co., Ltd. 122,589 117,464
Mianyang Zhongjian Kefa Guanlang road investment and
115,173 –
Construction Co., Ltd.
Xuzhou Metro Line Three Investment Development Co., Ltd. 114,885 199,433
Anhui Bengwu Expressway Investment Management Co., Ltd. 113,028 240,112
Liuzhou China Construction Steel Structure Dongcheng Exhibition
105,484 –
Construction Co., Ltd.
Chengdu Beichen Tianchen Real Estate Co., Ltd. 104,390 –
Haikou Tuoyi Real Estate Co., Ltd. 93,806 114,815
Zhengzhou Public Zhongcheng Road and Bridge Construction
86,523 202,227
Management Co., Ltd.
Shangang Group Ruitai Development Co., Ltd. 57,713 208,037
Yichang Urban Pipe gallery construction and Operation Co., Ltd. 50,403 147,150
Fast Shift Investments Limited – 547,363
Shanghai Port Group Israel Haifa New Port Wharf Co., Ltd. – 234,303
Others 2,045,798 1,193,699
Total 10,555,909 6,546,202

(4) Entrusted loans

31 December 2020 31 December 2019
China State Construction Group 3,502,322 2,000,000
Jinmao Investment (Changsha) Co., Ltd. 615,000 440,000
Total 4,117,322 2,440,000

(5) Long-term Payables

31 December 2020 31 December 2019
Sunrise JV Limited 2,400,000 2,400,000
Others 151,455 129,304
Total 2,551,455 2,529,304

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XI. Share-based payment

1. Overview

2020 2019
Number of restricted shares unlocked 303,016,000 112,527,800
Number of restricted shares forfeited 10,558,200 10,604,200
The remaining term of the contract of the outstanding stock options
4.0 3.0
  at the end of the year

2020 2019
Total amount of employee services in exchange for share based payment 506,233 554,496

The equity-settled share-based payment is as follows:

2020 2019
Accumulated amount of equity-settled share-based payment
1,680,450 1,174,217
  in capital surplus
Total expenses recognised in equity-settled share-based payment 506,233 554,496

2. Share-based payment plan

(a) Share-based payment by the Company

(1) In accordance with the authorisation of the first extraordinary General Meeting of Shareholders held on 19
December 2016, the Company held the 104th meeting of the first session of the Board of Directors on 29
December 2016, and the Board of Directors approved the resolution of China State Construction Engineering
Corp., Ltd. Granted Second Batch Restricted Shares Incentive Plan (A share) (“the second batch Incentive Plan”),
in which the Company was approved to grant the restricted shares incentive to 1,575 targets (“the second batch
Incentive Targets”). From 23 December 2016 to 27 December 2016, the Company completed the repurchase
of 260,130,000 shares (“the second batch of Restricted Shares”) in total from secondary market and completed
the granting to the second batch Incentive Targets on 29 December 2016 (“the second batch grant day”). The
second batch Incentive Targets’ purchase price is RMB4.866 per share and the limited sales period is 2 years.
If the unlock condition of the restricted shares prescribed by the plan is met, the second batch Incentive Targets
can unlock the shares with the upper limit of 1/3, 1/3 and 1/3 of the granted shares on 29 December 2018 (the first
batch of Phase II), 29 December 2019 (the second batch of Phase II) and 29 December 2020 (the third batch of
Phase II) respectively.
In accordance with the authorisation of the third extraordinary General Meeting of Shareholders held on 3 December
2018, the Company held the 15th meeting of the second session of the Board of Directors on 26 December 2018, and
the Board of Directors approved the resolution of China State Construction Engineering Corp., Ltd. Granted Third Batch
Restricted Shares Incentive Plan (A share) (“the third batch Incentive Plan”), in which the Company was approved to
grant the restricted shares incentive to 2,081 targets (“the third batch Incentive Targets”). From 4 December 2018 to 21
December 2018, the Company completed the repurchase of 599,910,000 shares (“the third batch of Restricted Shares”)
in total from secondary market and completed the granting to the second batch Incentive Targets on 26 December 2018
(“the third batch grant day”). The third batch Incentive Targets’ purchase price is RMB3.468 per share and the limited
sales period is 2 years. If the unlock condition of the restricted shares prescribed by the plan is met, the third batch
Incentive Targets can unlock the shares with the upper limit of 1/3, 1/3 and 1/3 of the granted shares on 26 December
2020 (the first batch of Phase III), 26 December 2021 (the second batch of Phase III) and 26 December 2022 (the third
batch of Phase III) respectively.
In accordance with the authorisation of the third extraordinary General Meeting of Shareholders held on 7
December 2020, the Company held the 50th meeting of the second session of the Board of Directors on 23
December 2020,and the Board of Directors approved the resolution of China State Construction Engineering Corp.,
Ltd. Granted Third Batch Restricted Shares Incentive Plan (A share) (“the fourth batch Incentive Plan”), in which
the Company was approved to grant the restricted shares incentive to 2,765 targets (“the fourth batch Incentive
Targets”). From 30 October 2020 to 14 December 2020, the Company completed the repurchase of 912,036,000
shares (“the fourth batch of Restricted Shares”) in total from secondary market and completed the granting to the
second batch Incentive Targets on 23 December 2020 (“the fourth batch grant day”).The fourth batch Incentive
Targets’ purchase price is RMB3.06 per share and the limited sales period is 2 years. If the unlock condition of
the restricted shares prescribed by the plan is met, the fourth batch Incentive Targets can unlock the shares with
the upper limit of 1/3, 1/3 and 1/3 of the granted shares on 23 December 2022 (the first batch of Phase III), 23
December 2023 (the second batch of Phase III) and 23 December 2024 (the third batch of Phase III) respectively.
If the business achievement or individual performance fail to meet the unlock condition, the unlocked restricted
shares will be repurchased by the Company at the grant price and with no interests.

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XI. Share-based payment (continued)

2. Share-based payment plan (continued)

(a) Share-based payment by the Company (continued)

(2) The market price of the second batch of Restricted Shares was RMB9.16 per share at the second batch grant
date. The price paid by the second batch Incentive Targets was RMB4.866 per share, considering the influence
from gain restrictive, the fair value of the second batch of Restricted Shares granted this time was determined to
be RMB2.2118 per share at the second batch grant date. Due to converting reserves into shares approved by
the resolution of the general meeting of shareholders on 3 May 2018, the subscription price of the second batch
Incentive Targets was adjusted to RMB3.476 per share.

The market price of the third batch of Restricted Shares was RMB5.58 per share at the third batch grant date. The
price paid by the third batch Incentive Targets was RMB3.468 per share, based on which, the fair value of the third
batch of Restricted Shares granted this time was determined to be RMB2.2112 per share at the third batch grant
date.

The market price of the fourth batch of Restricted Shares was RMB5.00 per share at the third batch grant date.
The price paid by the fourth batch Incentive Targets was RMB3.06 per share, based on which, the fair value of the
fourth batch of Restricted Shares granted this time was determined to be RMB1.94 per share at the fourth batch
grant date.

(3) In 2020, there are total 303,016,000 shares has been unlocked due to the third batch of Phase II and the first batch
of Phase III meet the unlock condition, and the treasury stock decreased by RMB1,051,692 thousand.

(4) Increase/decrease of restricted shares in the reporting period

2020 2019
Number of restricted shares at the beginning of the year 709,868,803 833,000,803
Number of restricted shares granted in current year 912,036,000 –
Number of restricted shares unlocked in current year (303,016,000) (112,527,800)
Number of restricted shares forfeited in current year (10,558,200) (10,604,200)
Number of restricted shares at the end of the year 1,308,330,603 709,868,803

(5) The impact on the Company’s financial position and operating results from restricted shares is as follows:
2020 2019
Total expenses recognised in equity-settled share-based
506,233 554,496
 payment

31 December 2020 31 December 2019

Accumulated amount of equity-settled share-based
1,680,450 1,174,217
  payment in capital surplus

(b) Share Option Schemes by China Overseas Land & Investment Ltd
On 29 June 2018, China Overseas Land & Investment Ltd offered to grant share options (the “Share Options”) to certain
eligible persons (collectively, the “Grantees”), to subscribe for a total of 107,320,000 shares, subject to acceptance of the
Grantees, under the share option scheme adopted by China Overseas Land & Investment Ltd on 11 June 2018. Out of the
107,320,000 Share Options granted, a total of 2,000,000 Share Options were granted to directors of China Overseas Land
& Investment Ltd. The exercise price is HK$25.85 per share. The Share Options granted will vest on 29 June 2020, 29 June
2021 and 29 June 2022 respectively.

On 29 June 2018, China Overseas Land & Investment Ltd offered to grant share options (the “Share Options”) to certain
eligible persons (collectively, the “Grantees”), to subscribe for a total of 285,840,000 shares, subject to acceptance of the
Grantees, under the share option scheme adopted by China Overseas Land & Investment Ltd on 11 June 2018. Out of the
285,840,000 Share Options granted, a total of 6,300,000 Share Options were granted to directors of China Overseas Land
& Investment Ltd. The exercise price is HK$18.724 per share.

As at 31 December 2020, 378,960,000 share options were granted for the plan (31 December 2019: 102,310,000).

The fair value of the Share Options was determined by the Binomial Options Pricing Model. For the year ended 31
December 2020, the relevant cost was RMB17,594 thousand arising from staff services. (For the 2019: RMB205,425
thousand).

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XII. Commitments and Contingencies

1. Commitments

31 December 2020 31 December 2019

Contracted, but not provided for Capital commitments
  Purchase and construction of non-current assets 4,390,960 4,276,122
  Investment commitments 14,413,258 16,567,580
Total 18,804,218 20,843,702

2. Contingencies

31 December 2020 31 December 2019

Contingent liabilities arising from pending litigations or
7,482,255 6,069,121 Note 1
 arbitrations
Contingent liabilities arising from the provision of guarantees 93,533,934 73,144,373 Note 2
Total 101,016,189 79,213,494

Note 1: As at 31 December 2020 and 31 December 2019, pending litigations in which the Group was the defending party
are listed as follows:
31 December 2020 31 December 2019
Disputed value Disputed value
China Construction Third Engineering Bureau Co., Ltd. 1,901,742 1,824,125
China Construction Seventh Engineering Division Co., Ltd. 1,309,537 1,018,443
The Company 627,609 219,702
Jilin Zhongjian Construction Engineering Co., Ltd. 599,351 950,963
China Construction Eighth Engineering Division Co., Ltd. 595,222 204,073
China Overseas Holdings Limited 402,944 508,408
China Construction Engineering Design Group Co., Ltd. 364,316 261,407
China Construction Fourth Engineering Division Co., Ltd. 349,237 141,034
CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. 328,746 97,958
China Construction First Building (Group) Co., Ltd. 327,801 265,207
China Construction Fifth Engineering Division Co., Ltd. 202,533 187,035
China Construction Second Engineering Bureau Ltd. 154,035 100,479
China Construction Decoration Group Ltd. 102,906 214,739
China Construction Railway Construction Co., Ltd. 100,396 –
China Construction Railway Investment and Construction Group Co., Ltd. 53,608 –
China Construction Sixth Engineering Bureau Co., Ltd. 30,649 –
China Southwest Geotechnical Investigation & Design Institute Co., Ltd. 23,012 24,790
China Construction Port and Shipping Bureau Group Co., Ltd. 7,015 29,811
China Northwest design and Research Institute Co., Ltd. 1,596 –
China Construction (Siping) Infrastructure Development Co., Ltd. – 20,947
Total 7,482,255 6,069,121

Note: The above pending litigations are mostly related with project quality, progress payment, etc. Please refer to
Note V. 39 for the progress of litigation matters at 31 December 2020 and the confirmed losses of judgment results,
and relevant liabilities are not recognized for the event that the potential obligations generated do not meet the
conditions for the recognition of provisions for other liabilities and charges.

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XII. Commitments and Contingencies (continued)

2. Contingencies (continued)

Note 2: As at 31 December 2020 and 31 December 2019, the Group’s external guarantees are listed as follows:
31 December 2020 31 December 2019
Guarantee amount Guarantee amount
Mortgage guarantee provided to property owners (Note) 88,071,537 67,602,266
Guarantees for bank loan 5,462,397 5,542,107
Total 93,533,934 73,144,373

Note: The Group provides guarantees to property owners and property owners pledge the houses they have bought
when taking loans from banks. For the year of 2020 and for the year of 2019, there was no significant breach of
contract from commodity house buyers and the Group considers the risk associated with the guarantee obligation is
immaterial.

XIII. Events after the balance sheet date

1. Pursuant to a resolution of the Board of Directors dated 16 April 2021, the Board of Directors proposed that
the Company distributes a cash dividend of RMB2.147 (before tax) for every 10 ordinary shares to all ordinary
shareholders on the basis of 41,948,167,800 shares as at the date of disclosure, dividends totalling approximately
RMB9.01 billion. In the event of any change in the total share capital of the Company before the date of registration
of the dividend distribution, it is proposed to maintain the same distribution ratio per share but to adjust the total
distribution accordingly. The details of the adjustment will be disclosed separately. The proposal for the distribution
of dividends is yet to be approved by the shareholders of the Company in general meeting and is not recognised
in this financial statement.
2. On 7 April 2021, the Company cancelled a total of 16,903,667 restricted shares not eligible for unlocking, which
were repurchased from 185 grantees who held Phase I, Phase II and Phase III restricted shares in the Company
(Phase II and Phase III restricted shares held by 42 of the 185 grantees have all been repurchased by the
Company). After the cancellation, the share capital of the Company was reduced by RMB16,903,667 to RMB
41,948,167,844.
3. After the balance sheet date, the bonds issued by the subsidiaries of the Group are as follows:
Interest rate
Issuer Type of bond Value in issue Issuance date (%)
China Shipping Enterprise Development
Medium-term notes 1,500,000 13 January 2021 3.35
Group Co., Ltd.
China Construction Eighth Engineering
Medium-term notes 3,000,000 19 March 2021 2.95
Bureau Co., Ltd.
China Construction Second Engineering Ultra short-term
1,500,000 9 April 2021 2.35
Bureau Co., Ltd. financing bonds
China Construction Seventh Engineering Ultra short-term
1,000,000 9 April 2021 2.73
Bureau Co., Ltd. financing bonds
China Construction Seventh Engineering Ultra short-term
1,000,000 23 March 2021 2.68
Bureau Co., Ltd. financing bonds
China Construction Seventh Engineering Ultra short-term
1,000,000 17 March 2021 3.09
Bureau Co., Ltd. financing bonds
China Construction Seventh Engineering Ultra short-term
1,000,000 12 March 2021 2.99
Bureau Co., Ltd. financing bonds
China Construction Seventh Engineering Ultra short-term
500,000 11 March 2021 2.85
Bureau Co., Ltd. financing bonds
China Construction Seventh Engineering Ultra short-term 25 February
500,000 2.39
Bureau Co., Ltd. financing bonds  2021
China Construction Seventh Engineering Ultra short-term
1,000,000 28 January 2021 2.70
Bureau Co., Ltd. financing bonds
China Construction Seventh Engineering Ultra short-term
500,000 28 January 2021 2.39
Bureau Co., Ltd. financing bonds
China Construction Eighth Engineering Bureau Ultra short-term
5,000,000 8 April 2021 2.35
Co., Ltd. financing bonds
China Construction Eighth Engineering Bureau Ultra short-term
1,500,000 4 March 2021 2.39
Co., Ltd. financing bonds
China Construction Eighth Engineering Bureau Ultra short-term
3,500,000 3 March 2021 2.45
Co., Ltd. financing bonds

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XIV. Other important matters

1. Segment reporting

Operating segments
For management purpose, the Group is organised into business units based on their products and has five reportable
operating segments as follows:

(1) Building construction engineering;

(2) Infrastructure construction and investment;

(3) Real estate development and investment;

(4) Prospecting, design, etc.;

(5) Others.

Management monitors the results of its operating segments separately for the purpose of making decisions about resource
allocation and performance assessment. Segment performance is evaluated based on the profit or loss of reportable
segment.

The intersegment transactions are transacted with reference to the prices used for transactions made to third parties at
then prevailing market prices.

2020
2020
Building Infrastructure Real estate
construction construction and development and Prospecting and
engineering investment investment design Others Unallocated Elimination Total
Revenue from external 972,432,561 343,565,132 271,130,912 10,134,610 17,760,112 – – 1,615,023,327
Inter-segment revenue 28,668,465 4,870,229 161,441 472,687 3,561,522 – (37,734,344) –
Total revenue 1,001,101,026 348,435,361 271,292,353 10,607,297 21,321,634 – (37,734,344) 1,615,023,327
Cost of goods sold (933,774,639) (318,931,135) (200,162,296) (8,039,404) (15,494,857) – 36,270,697 (1,440,131,634)
Credit impairment losses (1,935,276) (1,105,469) (137,180) (97,021) (65,569) (1,009) – (3,341,524)
Asset impairment
329,365 (169,820) (486,331) (4,060) 2,364 – – (328,482)
 (losses)/reversal
Depreciation and amortisation (4,434,224) (1,437,446) (1,885,623) (116,525) (956,174) (57,723) – (8,887,715)
Profit before income taxes 25,109,480 14,875,767 59,788,743 838,203 253,407 (5,111,348) (1,463,647) 94,290,605
Less: Income tax expenses (23,340,225)
Net profit 70,950,380
Total segment assets 553,061,207 456,631,155 890,515,087 13,438,532 349,688,054 138,837,009 (209,997,205) 2,192,173,839
Total segment liabilities 390,520,198 337,118,018 479,634,722 7,821,554 213,060,085 382,846,922 (195,922,761) 1,615,078,738

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XIV. Other important matters (continued)

1. Segment reporting (continued)

Operating segments (continued)

2019
2019
Building Infrastructure Real estate
construction construction and development and Prospecting and
engineering investment investment design Others Unallocated Elimination Total
Revenue from external 854,153,349 318,085,139 216,942,909 9,854,917 20,800,274 – – 1,419,836,588
Inter-segment revenue 18,212,768 20,196 36,919 39,363 3,000,621 – (21,309,867) –
Total revenue 872,366,117 318,105,335 216,979,828 9,894,280 23,800,895 – (21,309,867) 1,419,836,588
Cost of goods sold (816,661,197) (290,979,462) (149,490,891) (8,071,133) (16,529,092) – 19,505,575 (1,262,226,200)
Credit impairment
(895,279) 28,290 (137,432) (85,421) (1,182,988) 1,274 – (2,271,556)
 (losses)/reversal
Asset impairment
(1,354,324) (92,869) 191,662 – (11,138) – – (1,266,669)
 (losses)/reversal
Depreciation and amortisation (4,376,408) (1,614,901) (1,763,100) (165,473) (1,023,710) (103,800) – (9,047,392)
Profit before income taxes 24,454,176 18,459,731 47,172,280 277,669 1,834,372 (8,941,204) (1,789,178) 81,467,846
Less: Income tax expenses (18,262,603)
Net profit 63,205,243
Total segment assets 492,194,948 452,629,131 797,028,350 14,359,158 296,162,491 151,036,314 (168,958,463) 2,034,451,929
Total segment liabilities 344,650,751 357,982,984 431,415,403 8,006,469 218,824,106 340,650,990 (168,914,094) 1,532,616,609

Other information

Information about products and services

Revenue from external customers

2020 2019
Building construction engineering 972,432,561 854,153,349
Infrastructure construction and investment 343,565,132 318,085,139
Real estate development and investment 271,130,912 216,942,909
Prospecting and design 10,134,610 9,854,917
Others 17,760,112 20,800,274
Total 1,615,023,327 1,419,836,588

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XIV. Other important matters (continued)

1. Segment reporting (continued)

Other information (continued)

Geographic information

Revenue from external customers

2020 2019
Mainland China 1,525,382,093 1,315,805,861
In other countries/geographical regions 89,641,234 104,030,727
Total 1,615,023,327 1,419,836,588

The revenue information above is based on the locations of the customers.

Non-current assets
31 December 2020 31 December 2019
Mainland China 282,535,433 260,947,653
In other countries/geographical regions 30,542,196 30,635,140
Total 313,077,629 291,582,793

The non-current asset information above is based on the locations of the assets and excludes financial assets, long-term
equity investments and deferred tax assets.

Information about a major customer

The Group does not rely on one or several major customers.

2. Leases

As lessee
Finance leases: As at 31 December 2020, the unrecognised financing charge amounted to RMB79,516 thousand (2019:
RMB23,679 thousand), which was amortised using the effective interest method over each period of the lease term. The
Group had total future minimum lease payments under non-cancellable leases with its tenants lessors falling due as
follows:
31 December 2020 31 December 2019
Within 1 year, inclusive 481,314 169,689
1 to 2 years, inclusive 424,735 152,288
2 to 3 years, inclusive 287,895 63,574
Over 3 years – 28,441
Total 1,193,944 413,992

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XIV. Other important matters (continued)

2. Leases (continued)

As lessee (continued)
Operating lease commitments: The Group had total future minimum lease payments under non-cancellable leases with its
lessors falling due as follows:
31 December 2020 31 December 2019
Within 1 year 3,030,470 585,259
1 to 2 years 1,737,994 210,325
2 to 3 years 746,716 142,339
Over 3 years 1,448,515 183,909
Total 6,963,695 1,121,832

XV. Notes to the Company’s financial statements

1. Accounts receivable

The ageing analysis of accounts receivable is as follows:

31 December 2020 31 December 2019
Within 1 year 14,956,163 23,888,813
1-2 years 8,151,057 2,659,068
2-3 years 1,257,783 2,436,807
3-4 years 1,909,386 388,734
4-5 years 55,866 201,669
Over 5 years 777,603 341,097
Subtotal 27,107,858 29,916,188
Less: Impairment allowance (2,311,807) (1,829,600)
Total 24,796,051 28,086,588

Accounts receivable and impairment allowance are disclosed by category:

31 December 2020
Carrying amount Impairment allowance
Amount Ratio (%) Amount Ratio (%)
Impairment allowance individually accrued 11,928,970 44.01 952,099 7.98
Impairment allowance accrued by
15,178,888 55.99 1,359,708 8.96
  credit risk portfolio
Total 27,107,858 100.00 2,311,807 8.53

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XV. Notes to the Company’s financial statements (continued)

1. Accounts receivable (continued)

Accounts receivable and impairment allowance are disclosed by category: (continued)

31 December 2019
Carrying amount Impairment allowance
Amount Ratio (%) Amount Ratio (%)
Impairment allowance individually accrued 14,609,339 48.83 1,009,564 6.91
Impairment allowance accrued by
15,306,849 51.17 820,036 5.36
  credit risk portfolio
Total 29,916,188 100.00 1,829,600 6.12

As at 31 December 2020, impairment allowance of accounts receivable individually accrued is as follows:

Expected credit
Amount Impairment losses ratio (%) Reasons
Company 1 1,874,817 412,460 22.00 Recovery possibility
Company 2 489,578 61,197 12.50 Recovery possibility
Company 3 387,151 124,186 32.08 Recovery possibility
Company 4 370,659 50,677 13.67 Recovery possibility
Company 5 248,403 37,467 15.08 Recovery possibility
Others 8,558,362 266,112 3.11 Recovery possibility
Total 11,928,970 952,099

As at 31 December 2019, impairment allowance of accounts receivable individually accrued is as follows:

Expected credit
Amount Impairment losses ratio (%) Reasons
Company 1 2,004,490 440,988 22.00 Recovery possibility
Company 2 517,409 103,677 20.04 Recovery possibility
Company 3 495,466 4,955 1.00 Recovery possibility
Company 4 378,603 22,419 5.92 Recovery possibility
Company 5 270,299 210,371 77.83 Recovery possibility
Others 10,943,072 227,154 2.08 Recovery possibility
Total 14,609,339 1,009,564

The accounts receivable with impairment allowance accrued by credit risk portfolio are as follows:

Portfolio 1:

31 December 2020 31 December 2019

Estimated Estimated
gross carrying Expected Lifetime gross carrying Expected Lifetime
amount at credit losses expected amount at credit losses expected
default ratio (%) credit losses default ratio (%) credit losses
Within 1 year 2,633,444 2.00 52,669 4,871,767 2.00 97,435
1-2 years 1,022,530 5.00 51,126 818,301 5.00 40,915
2-3 years 372,463 15.00 55,869 133,891 15.00 20,084
3-4 years 1,633 30.00 490 19,147 30.00 5,744
4-5 years 41,868 45.00 18,841 – 45.00 –
Over 5 years 10,382 100.00 10,382 10,382 100.00 10,382
Total 4,082,320 189,377 5,853,488 174,560

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XV. Notes to the Company’s financial statements (continued)

1. Accounts receivable (continued)

The accounts receivable with impairment allowance accrued by credit risk portfolio are as follows: (continued)

Portfolio 2:
31 December 2020 31 December 2019
Estimated Estimated
gross carrying Expected Lifetime gross carrying Expected Lifetime
amount at credit losses expected amount at credit losses expected
default ratio (%) credit losses default ratio (%) credit losses
Within 1 year 1,446,424 6.00 86,785 2,025,215 6.00 121,513
1-2 years 232,130 12.00 27,856 137,901 12.00 16,548
2-3 years 71,975 25.00 17,994 216 25.00 54
3-4 years – 45.00 – 25,154 45.00 11,319
4-5 years 3,966 70.00 2,776 – 70.00 –
Over 5 years 253 100.00 253 268 100.00 268
Total 1,754,748 135,664 2,188,754 149,702

Portfolio 3:
31 December 2020 31 December 2019
Estimated Estimated
gross carrying Expected Lifetime gross carrying Expected Lifetime
amount at credit losses expected amount at credit losses expected
default ratio (%) credit losses default ratio (%) credit losses
Within 1 year 4,899,150 4.50 220,462 6,345,230 4.50 285,535
1-2 years 3,602,468 10.00 360,247 576,856 10.00 57,686
2-3 years 465,325 20.00 93,065 228,193 20.00 45,639
3-4 years 22,726 40.00 9,090 9,258 40.00 3,703
4-5 years 996 65.00 648 5,312 65.00 3,453
Over 5 years 351,155 100.00 351,155 99,758 100.00 99,758
Total 9,341,820 1,034,667 7,264,607 495,774

Impairment allowance of accounts receivable are as follows:

For the year ended 31 December 2020:

Opening balance Provision Reversal Other movements Closing balance
1,829,600 1,122,770 (594,203) (46,360) 2,311,807

For the year ended 31 December 2019:

Changes in
Balance at the accounting Opening Other Closing
end of prior year policies balance Provision Reversal Write-off movements balance
1,583,960 585,495 2,169,455 595,711 (891,982) (52,441) 8,857 1,829,600

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XV. Notes to the Company’s financial statements (continued)

1. Accounts receivable (continued)

The important reversal amounts in 2020 are listed as follows:

Amount of
Basis for the reversal/
Reason for reversal/collection impairment allowance collection Way of collection
Company 1 Accounts receivable of project collected Individually accrued 78,536 Cash
Company 2 Accounts receivable of project collected Collectively accrued 37,342 Cash
Company 3 Accounts receivable of project collected Collectively accrued 35,230 Cash
Company 4 Accounts receivable of project collected Collectively accrued 29,711 Cash
Company 5 Accounts receivable of project collected Collectively accrued 28,293 Cash
Individually and
Others Accounts receivable of project collected 385,091 Cash
collectively accrued
Total 594,203

As at 31 December 2020, the five largest accounts receivable due to customers are as follows:
Amount of % of total
impairment accounts
Amount allowance receivable
Total amount of the five largest accounts receivable 4,830,004 607,609 17.82%

As at 31 December 2019, the five largest accounts receivable due to customers are as follows:
Amount of % of total
impairment accounts
Amount allowance receivable
Total amount of the five largest accounts receivable 5,107,065 473,479 17.07%

2. Other receivables

31 December 2020 31 December 2019

Dividend receivables 1,190,122 1,173,991
Interest receivable – 3,157
Other receivables 20,838,785 21,392,563
Total 22,028,907 22,569,711

The ageing analysis of other receivables is as follows:

31 December 2020 31 December 2019
Within 1 years 15,056,515 16,322,284
1-2 years 5,605,813 3,933,831
2-3 years 1,573,531 1,097,297
3-4 years 26,589 1,232,786
4-5 years 257,061 157,518
Over 5 years 203,889 664,620
22,723,398 23,408,336
Less: Impairment allowance (694,491) (838,625)
Total 22,028,907 22,569,711

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XV. Notes to the Company’s financial statements (continued)

2. Other receivables (continued)

Natures of other receivables are as follows:

31 December 2020 31 December 2019
Receivables from related parties 19,777,018 20,073,488
Dividends receivable 1,190,122 1,173,991
Deposits and petty cash receivable 879,962 1,150,454
Others 876,296 1,010,403
Subtotal 22,723,398 23,408,336
Less: Impairment allowance (694,491) (838,625)
Total 22,028,907 22,569,711

Changes in impairment allowance recognised for the 12-month expected credit losses and lifetime expected credit losses
on other receivables are as follows:

For the year ended 31 December 2020

Stage 3
Stage 1 Credit losses of credit-
12-month impaired financial assets
expected (Lifetime-expected
credit losses credit losses) Total
Opening balance 35,688 802,937 838,625
Changes due to the opening balance
– Transfer to Stage 3 (20,445) 20,445 –
– Transfer to Stage 1 9,886 (9,886) –
Accrual 12,890 50,859 63,749
Reversal (12,305) (181,293) (193,598)
Write-off – (4,203) (4,203)
Other movements (4,128) (5,954) (10,082)
Closing Balance 21,586 672,905 694,491

For the year ended 31 December 2019

Stage 3
Credit losses of credit-
Stage 1 impaired financial
12-month assets
expected (Lifetime-expected
credit losses credit losses) Total
Opening balance 92,591 788,881 881,472
Accrual 15,425 1,021,127 1,036,552
Reversal (26,086) (45,097) (71,183)
Write-off (2,061) (1,008,400) (1,010,461)
Other movements (44,181) 46,426 2,245
Closing Balance 35,688 802,937 838,625

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XV. Notes to the Company’s financial statements (continued)

2. Other receivables (continued)

The changes in the book value of other receivables that affect the changes in the provision are as follows:

For the year ended 31 December 2020

Stage 3
Credit losses of credit-
Stage 1 impaired financial assets
12-month expected (Lifetime-expected credit
credit losses losses) Total
Opening balance 22,553,131 855,205 23,408,336
Changes due to the opening balance
– Transfer to Stage 3 (983,000) 983,000 –
– Transfer to Stage 1 18,972 (18,972) –
Addition 13,458,952 214,246 13,673,198
Derecognition (13,931,858) (375,817) (14,307,675)
Write-off – (4,203) (4,203)
Other movements (29,090) (17,168) (46,258)
Closing balance 21,087,107 1,636,291 22,723,398

For the year ended 31 December 2019

Stage 3
Credit losses of credit-
Stage 1 impaired financial assets
12-month expected (Lifetime-expected credit
credit losses losses) Total
Opening balance 21,021,896 807,605 21,829,501
Changes due to the opening balance
Addition 9,329,381 1,096,285 10,425,666
Derecognition (7,734,038) (87,968) (7,822,006)
Write-off (19,321) (1,008,539) (1,027,860)
Other movements (44,787) 47,822 3,035
Closing balance 22,553,131 855,205 23,408,336

The important reversal amounts in 2020 are listed as follows:

Amount of
Reason for reversal/ reversal/
collection Basis for the impairment allowance collection Way of collection
Company 1 Receivable collected Individually accrued 149,579 Cash
Company 2 Receivable collected Collectively accrued 16,000 Cash
Company 3 Receivable collected Collectively accrued 5,022 Cash
Company 4 Receivable collected Collectively accrued 3,611 Cash
Company 5 Receivable collected Collectively accrued 2,500 Cash
Others Receivable collected Individually and collectively accrued 16,886 Cash
Total 193,598

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XV. Notes to the Company’s financial statements (continued)

2. Other receivables (continued)

As at 31 December 2020, other receivables from the five largest customers are as follows:
Provision for
Closing % of total impairment
Balance balance Relation to the Company Ageing amount
Company 1 1,833,215 8.07 Due from Related parties Within 2 years –
Company 2 1,623,876 7.15 Due from Related parties Within 1 year –
Company 3 1,083,020 4.77 Due from Related parties Within 1 year –
Company 4 1,058,251 4.66 Due from Related parties 1-3 years –
Company 5 772,226 3.39 Due from Related parties Within 1 year –
Total 6,370,588 28.04 –

As at 31 December 2019, other receivables from the five largest customers are as follows:
Provision for
Closing % of total impairment
Balance balance Relation to the Company Ageing amount
Within 1 year and
Company 1 3,417,687 14.60 Due from Related parties –
1-5 years
Company 2 1,760,500 7.52 Due from Related parties 1-5 years –
Company 3 1,005,000 4.29 Due from Related parties 1-4 years –
Company 4 965,546 4.12 Due from Related parties Within 1 year –
Company 5 915,324 3.91 Due from Related parties Within 1 year –
Total 8,064,057 34.44 –

3. Long-term equity investments

31 December 2020 31 December 2019

Subsidiaries 174,729,180 162,880,983
  – Subsidiaries under direct control (1) 166,788,258 156,768,828
  – Subsidiaries under indirect control (2) 7,940,922 6,112,155
Joint ventures (3) 6,420,211 4,457,648
Associates (4) 4,694,469 4,144,278
Subtotal 185,843,860 171,482,909
Less: Impairment allowance (1,114,938) (759,180)
Total 184,728,922 170,723,729

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XV. Notes to the Company’s financial statements (continued)

3. Long-term equity investments (continued)

(1) Subsidiaries under direct control

For the year ended 31 December 2020
Opening Current year Closing Cash dividend
balance movements balance declared
China Overseas Holdings Limited 49,444,328 – 49,444,328 9,300,000
China Construction First Building (Group) Corporation Limited 7,576,219 – 7,576,219 1,238,830
China Construction Second Engineering Bureau Ltd. 5,209,149 – 5,209,149 1,972,030
China Construction Third Engineering Bureau Ltd. 6,271,354 – 6,271,354 4,381,770
China Construction Fourth Engineering Bureau Ltd. 5,199,701 – 5,199,701 1,290,320
China Construction Fifth Engineering Bureau Ltd. 6,413,789 – 6,413,789 2,677,779
China Construction Sixth Engineering Bureau Ltd. 4,277,946 – 4,277,946 759,980
China Construction Seventh Engineering Bureau Ltd. 6,006,530 – 6,006,530 1,368,470
China Construction Eighth Engineering Bureau Ltd. 10,139,151 – 10,139,151 3,807,130
China Construction Fangcheng Investment & Development
5,851,624 – 5,851,624 –
Co., Ltd.
Shenzhen China Overseas Investment Management Co., Ltd. 3,601,537 (3,300,000) 301,537 –
Infrastructure Business of China State Construction 10,194,030 1,000,000 11,194,030 920
China State Construction Finance Co., Ltd. 4,724,554 3,200,000 7,924,554 162,064
China Construction America, Inc. 2,655,833 1,321,020 3,976,853 –
China State Construction Development Co., Ltd. 1,410,947 379,690 1,790,637 –
China Construction Liupanshui Infrastructure Investment and
800,000 – 800,000 –
Development Co., Ltd.
China State Construction Thailand Co., Ltd. 656,107 – 656,107 3,984
CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. 2,641,967 239,939 2,881,906 91,280
China Construction (South Pacific) Development Co. Pte. Ltd. 520,630 – 520,630 75,120
China Construction Decoration Group Ltd. 548,375 – 548,375 53,380
China Construction Capital Holding Co., Ltd. 3,000,000 5,305,000 8,305,000 –
China State Railway Investment Construction Group Co., Ltd. 1,673,183 – 1,673,183 –
Zhongjian Silu Construction Investment Company Limited 1,166,000 334,000 1,500,000 –
Zhongjian Changjiang Construction Investment Co., Ltd. 886,096 150,000 1,036,096 –
China Construction North Investment Co., Ltd. 903,981 – 903,981 –
CSCEC Overseas Limited 400,000 – 400,000 –
Zhongjian Technology Limited 1,200,000 500,000 1,700,000 57,010
Others 13,395,797 889,781 14,285,578 427,309
Total 156,768,828 10,019,430 166,788,258 27,667,376

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XV. Notes to the Company’s financial statements (continued)

3. Long-term equity investments (continued)

(1) Subsidiaries under direct control (continued)

For the year ended 31 December 2019
Opening Current year Closing Cash dividend
balance movements balance declared
China Overseas Holdings Limited 49,444,328 – 49,444,328 7,281,230
China Construction First Building (Group) Corporation Limited 7,576,219 – 7,576,219 667,230
China Construction Second Engineering Bureau Ltd. 5,209,149 – 5,209,149 1,057,710
China Construction Third Engineering Bureau Ltd. 6,271,354 – 6,271,354 2,591,010
China Construction Fourth Engineering Bureau Ltd. 5,199,701 – 5,199,701 405,030
China Construction Fifth Engineering Bureau Ltd. 6,413,789 – 6,413,789 1,096,970
China Construction Sixth Engineering Bureau Ltd. 4,277,946 – 4,277,946 18,620
China Construction Seventh Engineering Bureau Ltd. 6,006,530 – 6,006,530 1,100,620
China Construction Eighth Engineering Bureau Ltd. 10,139,151 – 10,139,151 2,401,450
China Construction Fangcheng Investment &
5,851,624 – 5,851,624 –
Development Co., Ltd.
Shenzhen China Overseas Investment Management Co., Ltd. 3,601,537 – 3,601,537 –
Infrastructure Business of China State Construction 3,855,956 6,338,074 10,194,030 –
China State Construction Finance Co., Ltd. 4,724,554 – 4,724,554 –
China Construction America, Inc. 2,655,833 – 2,655,833 –
China State Construction Development Co., Ltd. 1,400,947 10,000 1,410,947 18,000
China State Construction Shandong Investment Co., Ltd. 1,000,000 (1,000,000) – –
China Construction Liupanshui Infrastructure Investment and
800,000 – 800,000 –
Development Co., Ltd.
China State Construction Thailand Co., Ltd. 656,107 – 656,107 –
CSCEC Xinjiang Construction & Engineering (Group) Co., Ltd. 2,292,614 349,353 2,641,967 124,540
China Construction (South Pacific) Development Co. Pte. Ltd. 520,630 – 520,630 –
China Construction Decoration Group Ltd. 548,375 – 548,375 –
China Construction Capital Holding Co., Ltd. 3,000,000 – 3,000,000 –
China State Railway Investment Construction Group Co., Ltd. 1,673,183 – 1,673,183 –
Zhongjian Silu Construction Investment Company Limited 833,000 333,000 1,166,000 –
Zhongjian Changjiang Construction Investment Co., Ltd. 553,096 333,000 886,096 –
China Construction North Investment Co., Ltd. 816,435 87,546 903,981 –
CSCEC Overseas Limited 400,000 – 400,000 –
Zhongjian Technology Limited – 1,200,000 1,200,000 –
Others 10,161,447 3,234,350 13,395,797 129,588
Total 145,883,505 10,885,323 156,768,828 16,891,998

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XV. Notes to the Company’s financial statements (continued)

3. Long-term equity investments (continued)

(2) Subsidiaries under indirect control

For the year ended 31 December 2020
Opening Current year Closing Cash dividend
balance movements balance declared
China Construction transportation construction Group Corp Ltd. 1,279,000 – 1,279,000 49,270
China West Construction Group Co., Ltd. 942,264 – 942,264 13,188
China Construction Installation Engineering Co., Ltd. 837,305 – 837,305 3,370
CSCES Technology and Engineering Co., Ltd. (Formerly
739,664 – 739,664 56,770
known as China Construction Steel Structure Corp. Ltd
Hangzhou China Construction Guobo Property Investment
668,432 – 668,432 –
Co., Ltd.
CSCEC Strait Construction and Development Co., Ltd. 300,000 – 300,000 543,504
China Construction Tunnel Construction Co., Ltd. 300,000 – 300,000 –
China Construction Electric Power Construction Co., Ltd. 230,000 – 230,000 –
China State Construction Foshan Transportation Joint
4,800 – 4,800 –
Investment Co., Ltd.
China Construction Overseas Development (Shanghai) Co., Ltd. 100,000 – 100,000 –
CSCEC Underground Space Co., Ltd. 100,000 – 100,000 30,800
China Construction Wuhan Construction Investment Co., Ltd. 60,000 – 60,000 –
China Construction Bridge Co., Ltd. 300,000 – 300,000 –
Others 250,690 1,828,767 2,079,457 –
Total 6,112,155 1,828,767 7,940,922 696,902

For the year ended 31 December 2019

Opening Current year Closing Cash dividend
balance movements balance declared
China Construction transportation construction Group Corp Ltd. 1,279,000 – 1,279,000 39,870
West Construction 942,264 – 942,264 10,860
China Construction Installation Engineering Co., Ltd. 837,305 – 837,305 –
CSCES Technology and Engineering Co., Ltd. (Formerly
739,664 – 739,664 –
known as China Construction Steel Structure Corp. Ltd
Hangzhou China Construction Guobo Property Investment
668,432 – 668,432 –
Co., Ltd.
Nanning China Construction Yongshen City Construction
356,700 (356,700) – –
Investment Co., Ltd.
CSCEC Strait Construction and Development Co., Ltd. 300,000 – 300,000 –
China Construction Tunnel Construction Co., Ltd. 300,000 – 300,000 –
China Construction Electric Power Construction Co., Ltd. 230,000 – 230,000 –
China Construction Chongqing Infrastructure Investment Co., Ltd 180,000 (180,000) – –
China State Construction Foshan Transportation Joint
4,800 – 4,800 15,800
Investment Co, Ltd.
China Construction Overseas Development (Shanghai) Co, Ltd. 100,000 – 100,000 –
CSCEC Underground Space Co., Ltd. 100,000 – 100,000 –
China Construction Wuhan Construction Investment Co., Ltd. 60,000 – 60,000 –

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XV. Notes to the Company’s financial statements (continued)

3. Long-term equity investments (continued)

(2) Subsidiaries under indirect control (continued)

For the year ended 31 December 2019 (continued)

Opening Current year Closing Cash dividend

balance movements balance declared
China Construction Langiang Infrastructure Investment and
45,000 (45,000) – –
Development Co., Ltd.
China Construction Science & Technology Co., Ltd 700,000 (700,000) – –
China Construction Bridge Co., Ltd 300,000 – 300,000 –
China Construction South Investment Co., Ltd 1,000,000 (1,000,000) – –
China Construction Zhejiang Investment Co, Ltd 816,424 (816,424) – –
China Construction East China Investment Co., Ltd 485,000 (485,000) – –
Others 1,362,820 (1,112,130) 250,690 –
Total 10,807,409 (4,695,254) 6,112,155 66,530

(3) Joint ventures

For the year ended 31 December 2020
Movement during the year
Investment Other
Increase/ income/ comprehensive
Opening (Decrease) in (losses) under income Distribution of Closing
Balance investment equity method adjustment dividends Others Balance
Zhaotong CSCEC Construction Investment Development Co., Ltd. 504,445 – 6,928 – – – 511,373
China Railway Construction Capital Construction Investment Co., Ltd. 500,023 (75,000) (16) – – – 425,007
CSCEC Road & Bridge Group Co., Ltd. 409,465 – 30,254 (165) – – 439,554
Zhengzhou Zhongjian Shenzhen Rail Transit Co., Ltd. 325,180 704,240 (331) – – – 1,029,089
Changsha CSCEC Chengtou Pipe Well Development Investment Co., Ltd. 320,063 – 3,398 – – – 323,461
CSCEC Zhanjiang Dadao Investment and Construction Co., Ltd. 318,458 53,879 (2,524) – – – 369,813
ASEC CIMENT SPA 289,048 – (545) – – (44,726) 243,777
Yinchuan Shenyang Road Underground Pipeline Construction &
268,484 – – – – – 268,484
Management Co., Ltd.
China Construction (Tianjin) Rail Transit Investment Development Co., Ltd. 235,092 225,692 – – – – 460,784
Guizhou Zhengxi Expressway Investment Management Co., Ltd. 229,225 – (5) – – – 229,220
Dalian Zhongjian Cavernous city construction and Development Co., Ltd. 227,360 – 4,253 – – – 231,613
Xuzhou Metro Line Three Investment Development Co., Ltd. 100,000 286,000 – – – – 386,000
CSCEC-Dacheng Construction Ltd 94,205 50,000 7,871 – (5,000) – 147,076
Qinghai Zhengping Jiaxi Highway Construction Co., Ltd. 58,800 235,200 – – – – 294,000
Chongqing Rail Transit Line 9 Construction and Operation Co., Ltd. – – – – – – –
Others 577,800 494,866 (61) – (11,645) – 1,060,960
Total 4,457,648 1,974,877 49,222 (165) (16,645) (44,726) 6,420,211

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XV. Notes to the Company’s financial statements (continued)

3. Long-term equity investments (continued)

(3) Joint ventures (continued)

For the year ended 31 December 2019
Movement during the year
Investment Other
Increase/ income/ comprehensive
Opening (Decrease) in (losses) under income Distribution of Closing
balance investment equity method adjustment dividends Others balance
Zhaotong CSCEC Construction Investment Development Co., Ltd. 511,431 – (6,986) – – – 504,445
China Railway Construction Capital Construction Investment Co., Ltd. 375,477 – 124,546 – – – 500,023
CSCEC Road & Bridge Group Co., Ltd. 330,703 – 28,952 345 – 49,465 409,465
Zhengzhou Zhongjian Shenzhen Rail Transit Co., Ltd. – 325,180 – – – – 325,180
Changsha CSCEC Chengtou Pipe Well Development Investment Co., Ltd. 300,218 19,800 45 – – – 320,063
CSCES Zhanjiang Dadao Investment and Construction Co., Ltd. 16,000 314,539 (12,081) – – – 318,458
ASEC CIMENT SPA 287,279 – (437) – – 2,206 289,048
Yinchuan Shenyang Road Underground Pipeline Construction &
268,484 – – – – – 268,484
Management Co., Ltd.
China Construction (Tianjin) Rail Transit Investment Development Co., Ltd. – 235,092 – – – – 235,092
Guizhou Zhengxi Expressway Investment Management Co., Ltd. 229,225 – – – – – 229,225
Dalian Zhongjian Cavernous city construction and Development Co., Ltd. 227,019 – 341 – – – 227,360
Xuzhou Metro Line Three Investment Development Co., Ltd. 100,000 – – – – – 100,000
CSCEC-Dacheng Construction Ltd 97,042 – 2,163 – (5,000) – 94,205
Qinghai Zhengping Jiaxi Highway Construction Co., Ltd. – 58,800 – – – – 58,800
Chongqing Railway Line No. 9 Construction & Operation Co. Ltd. 1,600,751 (1,600,751) – – – – –
Others 496,471 91,410 1,532 – (11,613) – 577,800
Total 4,840,100 (555,930) 138,075 345 (16,613) 51,671 4,457,648

(4) Associates
For the year ended 31 December 2020
Movement during the year
Investment
Increase/ income/
(Decrease) in (losses) under Distribution of
Opening balance investment equity method dividends Others Closing balance
CCCC Jijiao Expressway lnvestment & Development Co., Ltd. 1,302,988 441,915 (82,245) – – 1,662,658
Yunnan Huali Expressway lnvestment & Development Co., Ltd. 790,000 395,000 – – – 1,185,000
Xuzhou Metro Line One Investment & Development Co., Ltd. 465,000 – – – – 465,000
Sanmenxia National Highway 310 Southward Project Construction
450,000 214,335 – – – 664,335
Management Co., Ltd.
Anhui Province Yuehuang Expressway Co., Ltd. 224,000 – – – – 224,000
Shenshan Special Cooperation Zone Harbour City Investment &
199,754 (106,053) 1,473 – – 95,174
Construction Co., Ltd.
Liyang Znongjian Sander Environmental Management Co., Ltd. 140,880 – 5,260 – – 146,140
Cangzhou Development Zone Beiqi Industrial Park Investment
75,301 (46,000) 2,929 (3,263) – 28,967
Center (LP)

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XV. Notes to the Company’s financial statements (continued)

3. Long-term equity investments (continued)

(4) Associates (continued)

For the year ended 31 December 2020 (continued)

Movement during the year

Investment
Increase/ income/
(Decrease) in (losses) under Distribution of
Opening balance investment equity method dividends Others Closing balance
Xinyu Ring Road Construction Investment Co., Ltd. 60,000 – – – – 60,000
Taizhou Luqiao New Island Investment Development Co., Ltd. 19,727 – (132) – – 19,595
Shijiazhuang Transportation Investment Jinshi Expressway
19,600 – – – – 19,600
Construction Management Co., Ltd.
Zhangzhou Zhan Environmental Technology Co., Ltd. 19,000 57,000 (35) – – 75,965
Others 378,028 (328,072) (404) – (1,517) 48,035
Total 4,144,278 628,125 (73,154) (3,263) (1,517) 4,694,469

For the year ended 31 December 2019

Movement during the year
Increase/ Investment income/
(Decrease) in (losses) under Distribution of
Opening Balance investment equity method dividends Others Closing Balance
CCCC Jijiao Expressway lnvestment & Development Co., Ltd 1,248,821 131,000 (76,833) – – 1,302,988
Yunman Huali Expressway lnvestment & Development Co, Ltd – 790,000 – – – 790,000
Xuzhou Metro Line One Investment & Development Co., Ltd. 186,000 279,000 – – – 465,000
Sanmenxia National Highway 310 Southward Project
300,000 150,000 – – – 450,000
Construction Management Co., Ltd
Anhui Province Yuehuang Expressway Co, Ltd. 224,000 – – – – 224,000
Shenshan Special Cooperation Zone Harbour City Investment &
193,270 – 6,484 – – 199,754
Construction Co., Ltd.
Liyang Znongjian Sander Environmental Management Co, Ltd. 29,947 107,008 3,925 – – 140,880
Cangzhou Development Zone Beiqi Industrial Park Investment
75,301 – 6,538 (6,538) – 75,301
Center (LP)
Xinyu Ring Road Construction Investment Co, Ltd. 10,000 50,000 – – – 60,000
Taizhou Luqiao New Island Investment Development Co., Ltd. 10,000 10,000 (273) – – 19,727
Shijiazhuang Transportation Investment Jinshi Expressway
19,600 – – – – 19,600
Construction Management Co, Ltd.
Zhangzhou Zhan Environmental Technology Co, Ltd. – 19,000 – – – 19,000
Shjazhuang City Jiaojan Expressway Development Management
78,400 – (78,400) – – –
Co., Ltd.
Others 384,148 2,561 (7,634) (1,055) 8 378,028
Total 2,759,487 1,538,569 (146,193) (7,593) 8 4,144,278

4. Revenue and cost of sales

31 December 2020 31 December 2019

Revenue Cost Revenue Cost
Revenue from main operations 93,540,194 92,064,559 111,375,307 108,072,371
Revenue from other operations 51,542 41,396 41,241 32,610
Total 93,591,736 92,105,955 111,416,548 108,104,981

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 NOTES TO THE FINANCIAL STATEMENTS
297
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

XV. Notes to the Company’s financial statements (continued)

4. Revenue and cost of sales (continued)

Revenue is shown as follows:

31 December 2020 31 December 2019
Revenue from contracts with customers 93,553,817 111,382,044
Rentals 37,919 34,504
Total 93,591,736 111,416,548

As at 31 December 2020 and 2019, the transaction price allocated to the unfulfilled or partially unfulfilled performance
obligations is related to the progress of the corresponding contract, and will be recognised as revenue according to the
progress of performance in the future performance period.

The breakdown of revenue generated by the contract with customers is as follows:

31 December 2020 31 December 2019
Timing of revenue recognition
  Recognise revenue at a point in time 233,245 6,736
  Others 233,245 6,736
  Recognise revenue over time 93,320,572 111,375,308
   Housing construction project 19,478,468 26,612,161
   Infrastructure construction and investment 73,677,998 84,711,954
  Others 164,106 51,193
Total 93,553,817 111,382,044

5. Investment income

31 December 2020 31 December 2019

Investment income from disposal of long-term equity investments
28,364,278 16,958,528
  under equity method
Investment income from debt investments 511,099 648,808
Investment income from other equity instrument investments 60,702 53,556
Investment loss from disposal of long-term equity investments
(23,932) (8,118)
  under equity method
Investment income from disposal of long-term equity investments – 169,863
Investment income obtained during the holding period of the held
– 25,463
  for trading financial assets
Total 28,912,147 17,848,100

The company has no major restrictions on the repatriation of investment income.

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 Supplementary information provided by management
298
CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED ANNUAL REPORT 2020

Supplementary information provided by management

For the year ended 31 December 2020
(All amounts in RMB Thousand Yuan unless otherwise stated)

1. Statement of non-recurring profit or loss

2020
Gains from disposal of non-current assets 143,538
Government grants related with non-daily operations 110,094
Gain from stepped acquisition 133,746
In addition to the normal operation of the company’s effective hedging business, Income/losses
arising from changes in fair value and from disposal/redemption of the financial assets held
247,894
for trading, derivative financial assets, financial liabilities held for trading, derivative financial
liabilities and other debt investments
Interest income from loans to non-financial corporations 58,784
Reversal of the provision on receivables and contract assets for impairment on an individual basis 1,288,041
Income from disposal of long-term equity investments 7,016
Investment income from disposal of subsidiaries 136,721
Losses from non-operating activities or occasional matters 1,212,987
Other non-operating income and expenses than the above items (278,721)
Subtotal 3,060,100
Impact on income tax (559,777)
Subtotal 2,500,323
Impact on non-controlling interests (after tax) (241,595)
Total 2,258,728

The Group’s recognition of non-recurring profit or loss items shall be carried out in accordance with the provisions of
“Explanatory Notice of Corporate Information Disclosure of Public Securities Offering No. 1 – Non-recurring Profit or Loss”
(CSRC Announcement No. [2008]43).

2. Return on net assets and earnings per share

2020
Weighted average Earnings per share
return
on net assets (%) Basic Diluted
Net profit attributable to the Company’s ordinary shareholders 15.54 1.07 1.07
Net profit attributable to the Company’s ordinary
14.76 0.99 0.98
  shareholders after deducting non-recurring profit or loss

2019
Weighted average Earnings per share
return
on net assets (%) Basic Diluted
Net profit attributable to the Company’s ordinary shareholders 15.60 0.97 0.96
Net profit attributable to the Company’s ordinary shareholders
15.84 0.98 0.97
  after deducting non-recurring profit or loss

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 China Construction Fortune International Center, Building 3,
Courtyard 5, Anding Road, Chaoyang District, Beijing
Postal code: 100029
Tel: 86 10 8649 8888
E-mail: [email protected]
Website: www.cscec.com
@CSCECNews
@CSCECNEWS

Back Cover Photo: Jinggangshan Navigation and Power Hub Project on the Ganjiang River