Shanxi Provincial Audit Office of the People's Republic of China *& Audit Report *Z+r4i (2019) 64 3 SHANXI AUDIT REPORT (2019) NO. 64 Project Name: Shanxi Gas Utilization Project Financed by the World Bank & 8348-CN Loan No.: 8348-CN Project Entity: Project Management Office of Shanxi Guoxin Energy Development Group Co. Ltd. &: 2018 Accounting Year: 2018 Contents . Aio ..................................................................................... 1 1. A uditor's Opinion...................................3......... II. Financial Statements and Notes to the Financial Statements................6 ( . .. .. .. .. .. ..............................................................6 i. B alance Sheet...................................................................................... 6 C ii. Summary of Sources and Uses of Funds by Project Component..... 8 iii. Statement of Implementation of Loan Agreement......................... 1 iv. Special Account Statem ent............................................................. 12 v. Notes to the Financial Statements....................................................16 III. Audit Findings and Recommendations................................................24 fA 1† T LYAY 4ý9t I El Ag¶@ # týk9,F‡M ll 2018 1$ 12 )¶31 f‡]pp HRY*@4 Å Mi (% 6 if9% 18 :) i-* ki m#E A M, -T)7 2 ik& A R 91lttt M r-k lu BNN , [gel Å ‡ lP&W M Nh d Y il4 IF uax/I 2. -Rit, ýÅAf i -Y- C, 4 P -W, 9 V- Y -ý#JR3 --#f [ - (E) J itfi 41 -W - yI A iär4 rý kAfXiiffMx#dR* E >gKRMR½2 Š%@@kjE,R' %T )6§6 9 i l, 3Rí3Yt-‡10 f å† lk el 4 49 t m YT -ý 4M &t9&11 kydK& Mì & it 9 1Aì ik C Mruf1 t, i -T * Pk† t ix W iAtAtj,xK-e ý?4 4i nx4 T if&&M 4ts#0 le I J#ti_k- …’ {＿内部控制的有效性发表意见。审计工作还包括评价所选用会计政策的 …，’哈’‘险和作出会计估计的合理‘,，以及评价财务，民表的，蓉体歹，报 ｝我‘}“相信，我了，、J获取的审计证据是适当的、充分的，为发表审计 …’意见提供甲‘ I（引审计意见 ｝乃我们认为，第一段所列财务报表在所有重大方面按照中国的会计 ！准则、会计制度和本项目贷、赠款协定的要求编制，公允反映了世界 ｝银行贷款山襼煤层气综合利用项目20,8年’2月31日的财务状况及 ｛·截至该日’司年度的财务收支’项目执行和专用账户收支情况。 {（四）其他事项 !’我们抽查了本期内由省财政厅报送给世界银行提款申请书 …GXO40一GXO42·GX047一GXO67、GXO67一GXO87及所附资料。我们认为， ｛这些资料基本符合贷款协议的要求’可以作为申请提款的依据。 】乃．、、、、＿一＿、，、、＿、，、、、＿、、，~.,，、＿,__．一＿、二．* ｝本甲计帅葱见之后，共同构成甲计报告的迁有曲项内答：盯务张 i表及财务’眯附注和审计发现的’司题及建议。、一从 …一中华人民共和国击西晋审计厅 】2 0 19年6月2六旧 l乃 …地址：中国山襼省太原币万柏林区滨河西路南段129号B座 1邮政簖码：030024 〕彝申话：86一0351一3806182 l传真二86一0351一38061 82 …’ 1· 1. Auditor's Opinion Auditor's Opinion To: Project Management Office of Shanxi Guoxin Energy Development Group Co., Ltd., We have audited the special purpose financial statements (from page 6 to page 18) of Shanxi Gas Utilization Project financed by the World Bank, which comprise the Balance Sheet as of December 31, 2018, the Summary of Sources and Uses of Funds by Project Component, the Statement of Implementation of Loan Agreement and the Special Account Statement for the year then ended, and Notes to the Financial Statements. Project Entity and Shanxi Provincial Finance Department's Responsibility for the Financial Statements The preparation of the Balance Sheet, the Summary of Sources and Uses of Funds by Project Component and the Statement of Implementation of Loan Agreement is the responsibility of your entity, while the preparation of the Special Account Statement is the responsibility of Shanxi Provincial Finance Department, which includes: i. Preparing and fair presenting the accompanying financial statements in accordance with Chinese accounting standards and system, and the requirements of the project loan agreement; ii. Designing, implementing and maintaining necessary internal control to ensure that the financial statements are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Government Auditing Standards of the People's Republic of China and International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are fTee from material misstatement. 3 An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entities' preparation and fair presentation of the financial statements 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 the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is appropriate and sufficient to provide a basis for our audit opinion. Auditor's Opinion In our opinion, the financial statements mentioned in para. I have been prepared in accordance with Chinese accounting standards and system, and the requirements of the project loan agreement. These financial statements have fairly reflected the financial status as of December 3 1, 2018 of the Project, as well as the financial receipt and expenditure, project execution and the revenue and expenditure of the special account. Other Matter We have randomly inspected the withdrawal applications of GXO40-GX042 , GX047-GX067 and GXO67-GX087, as well as the supporting documents submitted by Shanxi Provincial Finance Department to the World Bank. In our opinion, the above-mentioned documents conform to the requirements of the Loan Agreement, and could be used as the basis of the loan withdrawal. The audit report consists of the Auditor's Opinion and two more parts hereinafter: Financial Statements and Notes to the Financial Statements, Audit Findings and Recommendations. Shanxi Provincial Audit Office of the People's Republic of China June 27, 2019 Address: Building B, 129, Western Binhe Road, Wanbailin District, Taiyuan City, Shanxi Province, P.R. China Postcode: 030024 Tel.: 86-351-3806182 Fax: 86-351-3806182 The English translation is for the convenience of report users; please take the Chinese audit report as the only official version. 5 * II. Financial Statements and Notes to the Financial Statements (-) 9 &~ i. Balance Sheet -Ft (BALANCE SHEET) 2018 - 12 l 31 E! (As of Dec 31, 2018) ;Tff A 9 Al F, , t 4] I (Statement I) PROJECT NAME: Shanxi Gas Utilization Project Financed by the World Bank Prepared by: Project Management Office of Shanxi Guoxin Energy Development Group Co. Ltd. *tk: A K fr ( Currency Unit: RMB Yuan) Application of Fund Line No. Beginning Balance Ending Balance I El ilt it Total Project Expenditures 1 833,220,460.47 1,336,059,764.54 1 j' Fixed Assets Transferred 2 1,702.56 13,010,101.88 2, $4401ii4 H i Construction Expenditures to be Disposed 3 3, ElL Investments Transferred-out 4 4, &IETtiL Construction in Progress 5 833,218,757.91 1,323,049,662.66 _ AR4 MA Invesment Loan Receivable 6 h-PattifffAV Including:World Bank Investment Loan Receivable 7 ggrPiAf g Appropriation of Investment Loan 8 4+: V1,114T'PiR Including: Appropriation of World Bank Investment Loan 9 M, ;E4 Equipment 10 49,572.65 2,908,220.77 P 4 I9MMA Including:.Equipment Loss in Suspense 11 -Ti X T1 5- if Total Cash and Bank 12 107,016,746.14 46,100,712.97 1 I1f P CashinBank 13 107,016,480.14 46,100,712.97 i: -WTFWrPV Including: SpecialAccount 14 2,380,882.20 1,622,138.46 2. fIA Cash on Hand 15 266.00 in fli#&6&& it Total Prepaid and Receivable 16 68,577,249.14 39,191,977.64 AIP: J MITlMf1 9 Including: World Bank Loan Interest Receivable 17 L4JRiiN), 7t World Bank Loan Commitment Fee Receivable 18 8aigty ,P 5 World Bank Loan Service-Fee Receivable 19 * -L. lifl~Th~20 /L %ilES MarketableSecurities 21 6,400,000.00 Total Fixed Assets 22 3,606,266.08 3,903,127.28 LA Z Original Cost of Fixed Assets 23 3,978,447.46 4,653,268.66 1:j1 tRitIFTIH Less:Accumulated Depreciation 24 372,181.38 750,141.38 MT 'Q Net Val ue of Fixed Assets 25 3,606,266.08 3,903,127.28 Fixeod Assets Pending Disposal 26 i Fixed Assets Losses in Suspense 27 2Total8ApplicationofFund 28 1,012,470,294.491,434,563,803.20 * - - - - W F (BALANCE SHEET) 2018 4- 12 A 31 a (As of Dec 31, 2018) : 4T , dL 15 Alt : 4 j SA 4 Statement I (continued) PROJECT NAME: Shanxi Gas Utilization Project Financed by the World Bank Prepared by: Project Management Office of Shanxi Guoxin Energy Development Group Co. Ltd. -!ttfi: A R, -r1 ( Currency Unit: RMB Yuan) Sources of Fund Line No. Beginning Balance Ending Balance Y,1 N VA-it Total Project Appropriation Funds 28 182,395,181.19 25,115,539.07 Tjr F1 'A *t $ V tR" Project Capital and Capital Surplus 29 433,687,563.58 453,199,976.54 P M Including:Grants 30 Total Project Loan 31 391,523,275.12 1,024,235,501.51 1 Total Project Investment Loan 32 391,523,275.12 1,024,235,501.51 (1) I3THV Foreign Loan 33 379,528,347.11 552,404,828.41 Including:IDA 34 3PTYXfR4RV IBRD 35 M Technical Cooperation 36 i Co-financing 37 (2) 1 J Domestic Loan 38 11,994,928.01 471,830,673.10 2, # OtherLoan 39 72I~ L M 2Appropriation of Investment Loan 40 YR, Including: World Bank Loan 41 V,I Bond fund 42 SWrP)5 N R Project Expenditures to be Offset 43 -b. &4,$ Total Paybale 44 99,147,499.26 89,986,110.51 : , Including: World Bank Loan Interest Payable 45 t World Bank Loan Commitment Fee Payable 46 i E iA,J World Bank Loan Service Fee Payable 47 Ak Ai,It OtherPayables 48 -94,952,972.65 -158,032,137.28 1. A Appropriation of Fund 49 836,102.57 - F. 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Н `��'; '`К �; Н �: � ?� �� #�: -}- ,,� �--i N М .�' т-г �. N. С`"7 � 1� т-� N С'J �� 1 ' г г --�' П"1 �� . � 09) _ ffljkpaA iv. Special Account Statement -i )MPV (SPECIAL ACCOUNT STATEMENT) *MA3_ 2018 * 12 P 31 H (For theMONTH Period Ended Dec 31, 2018) A 4 (Statement N) rP -P A P, #4- D4 (Name of borrower: People's Republic of China) JF Name of Project:Shanxi Gas Utilization Project Financed by the World Bank Prepared by: Shanxi Finance Department Currency: U SD A%3 : PART A-ACCOUNT ACTIVITY FOR THE PERIOD Amount AAMiIi! Beginning Balance 369,190.37 Add (10H) : *gAtT WTH*,02,03 Total amount deposited by World Bank 21,091,218.14 1,849.09 Total interest earned this period if deposited in Special Account *4A _**K Lh 99LT,k M! Total amount refunded to cover ineligible expenditures Deduct 051 11N) : Total amount withdrawn 21,219,217.47 AA IN, T i :PE 4_1 C rp , P K * 141-1- 3 _ 11 1 11 50.00 Total service charges if not included in above amount withdrawn Ending balance (month/day/year) 242,970.13 B fV . PART B-ACCOUNT RECONCILIATION 1, Amount advanced by World Bank Deduct Qgk I) - 2, Total amount recovered by World Bank 3N Present outstanding amount advanced to the Special Account at month/day/year Ending balance of Special Account at month/day/year 242,970.13 Add 0:§5110: 3 H* g! Amount claimed and not yet credited at montli/day/year 6, Amount withdrawn and not yet claimed 7, *4AAK*A- (Pn7 *j E 5 fn 6 120.001 Service charges for the period (if not included in item 5. or 6.) Deduct QA ,[,): 81 6,737.05 Interest earnings for the period (if included in Special Account) 9, *Aq9 M kPT50,44IM) Total advance to Special Account accounted for at month/day/year 236,353.08, ! � «) �-�-4��1�✓� . ��4��{��� • �j � 1• "%� Kj � � о � �� У �, �.г � �'J 1� т�� а � С�1 � � =�г ��1-�-- ��т �г� �1.� � � � �I �1 ��С��� � С � 1� i��i�� : 1=1,J% 1 fJ ŭ�I� ) ф �'� ,��� 1� � 1т �к т%�- 7, �� H J�� /L, � z�т р��� 1�1 тJ; � о т%� � а � ���х 1� �� : ���1 Iл��У'=�,� ��`����i, a �.�'`��'=��� � х� �J� � , �/�Jf� �/�`�г)� � о i� ф У':1 д/'7�К/га � Т��С'Li���I1� � ���J"f-�-'1/ 1 )`I`1 � 1� (���, а ф� а I�a� а��T�-�120ЛiIW���I� t��� а��=��-T���lL�k1, '1/п,u��4J1.�7�J47.5MWo���it�Г��L�� � У'Jт%�а���'���С�р ц�C�;.i�L�'�� �' г�, ��а��с�; ����1�г�, � � ��,���'J t г�., �а����; ��'J I���,:l-� � 1i�` �- � i' �„ -L �'J I� у� о l� Q Ч J 7\ �U J�/� /J � f/ L��г %L fJ 1 z1� � J j'i� �� , ������✓���Тр7, �I�, ����✓�����ЧJ����.1��о 1J��7 ��� �-���р г �_ '� ���, �l� �'� а С, g���.� ����Т�, ��.tF���.S��r'J1� ���, ��� �т��),� ✓1 J � � " 1 "J 7 �У- Т"'� -7- � GL � /� 77 -Г ` �, , !.� � о , ���:Т��'G�л`���а��г�г�J.��,/�х�ГРk7'7�J-���c� г�� ������, �1.����� � (�с,�; �) �.�i��t���` �7, :г�Т,� g �1L���к���t�%` �J o �ф, ��и� � �; �� C��f�` � �. � 1�Т� . � �а �1 л�l� �� ф,������ а ; � ��1�- �: С � �'�) ��i���C��`��.�-�C:ia. ��, ��р, 1�а������'Jl�г�т��а; � Т�� � гiL � �С ,��„�, --L �l �� %� �J �г �: � �� г-� � ,�; -L ��� I�11- � ���;, а о 2014`�1� � ((a��i��������ТТ��'%���r�%�`т а �'�I��1� � а ���ф�i��� � �J�E��)) (����F�� (2014) 13�) , ���а ����18.02 1 �-+ � � � ' 1" о �:� /7J � �� %'� ��. 1 �� � / и `�� l�7 V . 1 � I C� ��i � GV ' 1" / , L=1 �J71 � L�, f� 1 Г � 1-��т�� ��h�П ���о 97ooT��I�J �-� а �-�х с � ф : ��г�451Т �► �7�, �%-'�-iX��'�I-��h9249T� ��) , 275Т� ��GI�1 ��х�����7 С'�i�J��C� J �а �'Л1 � ) , 25/J 7С�/J ��1� J\ о г)n � ���Т/J5�o 2014�'�'5� , L` �J�`���т � � .��-�- �� 1 �iT� �I ((�� �f���C)i , ��тl"С� ����71 TZ,�Ti�, �25Т7 �7Gi� 1�� т��г а���а�1'�к��' �'�'%�i7-z a90�c т� �� ��р�1�7 а�72020 о � J� ТА- �/� 1- f ) � � �-6�ЗОао 2. rJ ���%tN '1''J �G � о ������� '�'J✓�C�ih�il,�Cl��r���1.�.� r 13 � w -1 Lý4t3)ff, H ffi IX I pH ýý t-f14- lä cgm ( A lä lk lål , -Ki k ýh- /l,,- 111 R x Xä I ý 4 14 4 ttk Hk -A-l AR 4Alýkrt)fl 3. i 3. 1 tý IRIUC jkP? 2F IT C, «k k -k, i+ MIJ -- X, 4RD) f -4 w ÄR 4 k - ýi4 IA , iý -1 4A g- - t k X, I tý k Ak -AP T k C, «-9 - i K ýf JiQ H A57 iý tyý , 4 k ifk JT- T t C, «fý ik 4f ýkkfx Lb å 4 9 ýK t$ Åå 91111 m :UK h 94 -ý- t 9 , lplý- it X f ý1 f),fl- kix IR k Aj 4t t MU49 f 0 f- * yt k 1ý- JK JK ik - ýr * ý11 . 3. 2 ýt 2tý X 1ý & ý*)fi Ft äf- M, PP k ffi 4 Af- I A 1 12 A 31 E 3. 3 5 4Pý it 4ý -X 9 lp, * k 4: M 11 t C ffi Yli I Aý ffi 4-1b 1-9ý k 4. 4. dvý 5dý- 12018 f- 12 A 31 iý 411 M L ýt ýý1 1ý ý24 480,487,939.79KýL-, jtrt: W&JKJKPýý37,796,976.89ÄÅ, -i;K3ý4,t37,769,483. 78X --,c, 1*3ý4t4,671,479. 124Qc- t, týl4250, 000 4. 2 iM ýHKP 4#M Jffll [å -tå »f t 9 Lb ffi 4 ýý- 4-i, 14014410100220503113, 21,091,218.14 ,*t, 411,C,ý&ÅI,849.09X7L, *,'ý-13ý4t,21,219,237.47,4t, tk , 5 0 4,~ - , -T- * + #Q 2 4 2, 9 7 0. 13 Xyk 4. 3 19Q å fx 12 0 18 12 M 3 1 H , -TF 9 Y, it 2-1n A Jt JRý 1, 3 3 9, 9 6 2, 8 9 1. 8 2 14 $ ‡¶@598, 504, 957. 49 N,I#510, 191, 031. 7, (E 443O‡3UB) 220,221,805. 69 , d I}i9,329,296. 94, bF4 1, 715, 800 j-o 5. 9,40 H W 5. 1 ".4 " M ÄR % 1, 323, 049, 662. 6 6 JL C t 9-L yx -1, e 2WVTWA* t& 9 ýIL «, k f9,1M V- ¤ÄR -K 5. 2 " 1, ý yt-k" MÅ4K ý 4 6, 100, 712. 9 7 No4%4 P 2 -- y 4~ ~c 9#4(ß#i (k W/Jp ty &) R AI, -k 5. 3 "2f 3P # "M t 26, 3 53. 0 8 , Ae 9, 5f g ~~~1, 6 22, 13 8. 4 6 o$d jiN $£ o 5.4" 1, 024, 235, 501. 51 o 4 i VVUXW å)U 80,487, 939. 79 ÁX (t41b¶ AMiE 250,000 ) ) AF2j\R i1P552,404,828.41Ai IMP 42rJMMkŠOý471, 830, 673. 1 5.5 "AkkA5it" RA 0 A-158,032, 137.28 7- . - 414A * 5. 6 "A qk A" J #QI Y 58,812.86 2 ý1 * 6.-XtIf A7 t1 V. Notes to the Financial Statements Notes to the Financial Statements 1. Project overview Shanxi Gas Utilization Project is financed by the World Bank, and implemented by Shanxi Guoxin Energy Development Group Co., Ltd. (hereinafter referred to as " GXED"). The construction components include: 2 gas-fired CHP projects and 5 gas distribution network projects, i.e. newly-built 120MW distributed gas-fired CHP project in Baode County of Xinzhou City and Xiyang County of Jinzhong City respectively, with heat-supply load of 47.5MW, as well as gas distribution network built in Changzhi County, Xiangyuan County, Tunliu County,Yangcheng County and Qingxu County. The implementation of the Project could accelerate the adjustment of economic structure of Shanxi, promote the in-depth reform of energy transportation, supply and consumption. In addition, the implementation of the Project could further improve the ecological environment, reduce the greenhouse gas emission in selected areas and counties, enhance the energy utilization efficiency, optimize the energy consumption structure and promote the development of "four gas" development of Shanxi. * The implementing agencies of the Project include Shanxi Natural Gas Company (SNGC), Shanxi Coal Bed Methane Pipeline & Transportation Company (SCPTC), and Shanxi Qingxu Kaitong Natural Gas Company (QKNGC), all of which are subsidiaries of GXED. SNGC is responsible for 2 distributed gas-fired CHP components in Baode and Xiyang County. SCPTC is responsible for the gas distribution network components in Changzhi, Tunliu , Xiangyuan and Yangcheng County. QKNGC is responsible for the gas distribution network component in Qingxu County. * In January 2014, National Development and Reform Commission officially approved Shanxi Gas Utilization Project (FA GAI WAI ZI [2014] No. 13). The total investment of the Project is CNY 1.802 billion, with the World Bank Loan of US 100 million dollars (equivalent to CNY 610 million), including US 97 million dollars used for physical construction (civil works: 4.51million US dollars, equipment and material procurement: 92.49 million US dollars), US 2.75 million dollars used for technical assistance (consulting service and training) and US 250,000 dollars of front-end fee. The construction period of the Project is 5 years. In May 2014, the World Bank 16 and the Ministry of Finance signed the Loan Agreement, with total loan of US 100 million dollars, including US 250,000 dollars of front-end fee. The Project came into effect in 90 days afterwards the signing date of the Loan Agreement. The closing date is June 30, 2020. 2. Consolidation Scope of the Financial Statements and Basis of Preparation Consolidation scope covers the financial statements as of December 31, 2018 * of Project Management Office of GXED, Baode Gas-fired CHP Component, Xiyang Gas-fired CHIP Component, as well as gas distribution network components in Tunliu, Xiangyuan, Changzhi ,Yangcheng and Qingxu County, as well as the special account statement of Shanxi Provincial Department of Finance. 3. Main Accounting Policies 3.1 The applicable accounting policies include: Accounting Standard for Business Enterprises, Accounting Methods for the World Bank Financed Project and Provisional Measures on Financial Management, Accounting and Loan Withdrawal and Reimbursement of Shanxi Gas Utilization Project, as well as other related regulations. 3.2 In accounting practice, the Gregorian calendar year is adopted as the fiscal year from January 1 to December 31. 3.3 The accrual basis and the debit/credit double entry bookkeeping method are adopted. RMB is used as the recording currency of bookkeeping. 4. Project Implementation Progress 4.1 Execution of Loan Agreement: As of December 31, 2018, totally 80,487,939.79 US dollars have been withdrawn from the World Bank, including 37,796,976.89 US dollars as the reimbursement from the World Bank, 37,769,483.78 US dollars paid through letter of credit, 4,671,479.12 US dollars as direct payment and 250,000 US dollars as the front-end fee. 4.2 Special account: The special account is established in Shanxi Branch, Construction Bank of China, account No.: 14014410100220503113, currency: USD. As of December 31, 2018, totally 21,091,218.14 US dollars have been reimbursed from the World Bank. The interest income during the current period is 1,849.09 US dollars; 21,219,237.47 US dollars was paid during the 17 0 current period as the project expenditure; 50 US dollars was paid as the service fee. The balance at the end of the period is 242,970.13 US dollars. O 4.3 Project Investment Progress:As of December 31, 2018, the total investment of CNY 1,339,962,891.82 has been completed, including goods: CNY 598,504,957.47, works: CNY510,191,031.70, others (mainly referred as unamortized expenses): CNY 220,221,805.69, technical assistance: CNY 9,329,296.94, and front-end fee: CNY 1,715,800. 5 Explanation of Subjects 5.1 Construction in Progress: Its balance as of December 31, 2018 was CNY 1,323,049,662.66, including investment of building and erection project, equipment investment, amortized investment and other investment. 5.2 Cash and Bank: Its balance on December 31, 2018 was CNY46,100,712.97, including the bank deposits and cashes of each project entity. 5.3 Ending Balance of the Special Account: this is refers to the special fund of World Bank loan. The ending balance is 236,353.08 US dollars, equivalent to CNY1,622,138.46. * 5.4 Project Loan: the ending balance is CNY1,024,235,501.51, reflecting construction investment loan and other loans borrowed by the project entities, in order to accomplish the project target, including foreign loan: 80,487,939.79 US dollars (including 250,000 US dollars of front-end fee), equivalent to CNY552,404,828.41, as well as the domestic loan: CNY 471,830,673.10. 5.5 Other Payables: Its ending balance is CNY-158,032,137.28, reflecting tax payable, carry-over balance payable of construction project, payable income of construction project and other payables. In this report, it mainly refers to the retained input tax of VAT. 5.6 Retained Earnings: Its ending balance is CNY58,812.86, referring to revenue of commissioning, net value of material transfer, net value of claim and penalty, as well as the interest margin of on-lending. In this report, it mainly refers to the interest margin of on-lending. 6. Other Material Matters None.