Jinyu Car City (000803):1 Million Sold Real Estate Subsidiary 1.57 Acres Of Land Net Book Value 300 Thousand

In September 2019, the "North control department" of Jinyu car city suddenly launched an attack, proposing a sharp reduction of the 9 member board to 5. Finally, in October this year, Jinyu city completed the general election of the board of directors, and the "North control department" fully controlled the listed company ahead of schedule. But in the past more than half a month, Guo Junyuan, the newly elected state owned independent director of Jinyu car city, resigned quickly and resigned from all positions of the listed company for personal reasons.

In addition to changes in the executive level, the securities times e reporter also noted that Jinyu car city has recently sold its property subsidiary plan to the table. The motion was strongly opposed by the independent director 5 months ago because of low selling suspicion, and was finally rejected by the shareholders' meeting. A few months later, Kim woo Che city not only did not respond to public queries in detail, but also added new doubts.

According to the latest assessment report, the reasons and assessment methods for the sale of Jinyu car city have not changed, and a lot of land assets have been included. But the selling price is still finalized at 10 thousand yuan, and the two winning bidder is the same company. A person familiar with the matter told the securities times e reporter that Jinyu car city, in order to sell its subsidiaries, is essentially self inflicted and has doubts about the value of the assets valuation.

The new independent director resigned quickly.

"North control department" pointed out that because Jinyu car city is now in a relatively small scale and the number of board of directors of listed companies is too large, in order to streamline personnel, improve governance structure and improve decision-making efficiency, according to the actual needs of the operation and governance of the board of directors of Jinyu City, it is proposed to reduce the number of board members from 9 to 5. Among them, the non independent directors were reduced from 6 to 3, and the number of independent directors was reduced from 3 to 2.

In October 10, 2019, Jin Yu car city received letters of proposal from important shareholders such as "North control department", Tibet Rui Dong, Nanchong state capital, and Jin Yu holding group, and presented their respective board candidates respectively. Among them, North control photovoltaic nominated Kuang Zhiwei and Wang Kaijun as the new non independent directors of Jinyu City, Zhang Ruji and Wang Yunchen were independent directors; Tibet Rui Dong nominated Xie Xin as a non independent director; Jin Yu holdings nominated Hu Ming and Hu Zhiqi non independent directors; Nanchong state owned only nominated Guo Junyuan as an independent director.

In October 21st, Kim Yu Che formally convened a provisional shareholders' meeting to vote on board members. The struggle for control over listed companies became clearer over the past two years. Finally, with the result of the election of the new board of directors, the "North control department" will actually control the board of directors of 4/5, and the two largest shareholders seem to have won the battle.

The voting results from Jinyu City revealed that Kuang Zhiwei, Wang Kaijun and Hu Ming were elected new directors of listed companies, while Wang Yun Chen and Guo Junyuan were elected new independent directors.

Securities Times e reporter noted that Wang Kaijun, director Wang Yunchen and Guo Junyuan were new faces, and the last independent director left office. As the second largest shareholder of Jinyu car city, Nanchong voted only to nominate a single director, plus a concerted action with the "North control department". After the election, the "North control department" actually owns the board seat of Jinyu Che Cheng 4/5, so as to achieve complete control of Jinyu car city.

From the curriculum vitae, Guo Junyuan was born in 1973. He was the director of Sichuan Yuan Li law firm, Deputy Supervisor of Nanchong Lawyers Association and distinguished professor of Law School of China West Normal University. (editor's note: a slight deletion of resume)

However, Guo Junyuan was elected sole director for more than half a month. He was able to submit his resignation to the board of directors of Jinyu car city on 7 November. For personal reasons, he applied to resign his office as director of Jinyu city and his duties in the Specialized Committee. In this regard, Wu Xiaohui, director general of Jinyu car city, said that the specific reason was not clear, and the resignation report was only for personal reasons.

Provision for impairment due to illegal construction

In the evening of November 5th, Jinyu car city issued a notice of impairment of assets, and its subsidiary Nanchong Jinyu Real Estate Development Co., Ltd. (hereinafter referred to as Jinyu real estate) received the advance notice of administrative treatment issued by the Nanchong administration and comprehensive law enforcement bureau of Jialing District in October 28th. It told the illegal construction of Jinyu property to be demolished.

Jinyu car city said it would prepare 58 million 418 thousand and 800 yuan for the illegal construction. As a result, the provision for impairment of assets will reduce the net profit of the listed companies in the current period by 48 million 630 thousand and 800 yuan after hedging the original liabilities estimated to be 9 million 788 thousand yuan.

Securities Times e reporter noted that the illegal construction mainly involved Jinyu real estate. In July 2014, the 4 floor of the "shengtiancheng complex" 1 Jialong Road, Jialing District, and the east side of the shopping mall and the south side respectively built brick and concrete structure housing 5290.81 and 4780.52, to build 1 stories.

The notification issued in October of this year has pointed out that the above housing is a frame structure and permanent building, but it is illegal construction if it has not gone through the construction planning permit. In addition, Nanchong Jialing district urban management and comprehensive law enforcement bureau intends to order Jinyu property to demolish within 10 days, and has not yet demolished the administrative decision to demolish according to law.

It is worth noting that the original value of the fixed assets of some houses illegally built by Jin Yu property is 62 million 882 thousand and 100 yuan, depreciation is 4 million 463 thousand and 300 yuan, and the net value is 58 million 418 thousand and 800 yuan. In order to legalize this part of the illegal construction, according to the relevant government documents, the half year report of Jin Yu's car city in 2019 has accounted for 9 million 788 thousand yuan of projected liabilities.

Statistics show that Jinyu real estate was established in April 1997, with a registered capital of 40 million yuan, controlled by Jinyu car city 100%. By the end of 2018, the total assets of Jin Yu's real estate were 365 million yuan and 47 million 700 thousand yuan of net assets. In 2018, the company's operating income was 20 million 820 thousand yuan, while net profit was 23 million 210 thousand yuan. In September 30, 2019, Jin Yu's real estate revenue was 12 million 410 thousand yuan, and its net profit was -7538 yuan.

10 thousand yuan to sell Jinyu real estate

In the evening of November 5th, Jinyu car city further announced that in order to focus on the new main business, the listed company intends to sell the 100% stake in Jinyu real estate.

The reason given by Jinyu car city is that the profitability of listed companies' real estate business is weak, and at present, no land reserve is enough to support the sustained development of real estate business. In 2017, Jinyu car city began its business transformation after acquiring Jiangsu Zhi Lin Electric Technology Co., Ltd. (hereinafter referred to as Chi Lin Electric). By the end of 2018, it had been transformed into a new energy related business.

Jinyu car city said, Jinyu real estate in the three quarter of 2019, net assets of -2768 yuan (merger caliber), the transaction does not constitute a major asset reorganization, without the approval of the relevant departments.

According to the evaluation report issued by Zhongtian and evaluation, in September 30, 2019, the total assets value of Jinyu real estate was 301 million yuan, the assessment value was 273 million, the debt book value was 273 million yuan, the total value of shareholders' rights and interests was 28 million 130 thousand yuan, and the valuation value was -23.67 million yuan. According to the income method, the total value of all rights and interests of shareholders of Jinyu real estate is 28 million 130 thousand yuan, but the assessment value is -8290 yuan, and the impairment amount is 111 million yuan.

By comparison, the difference between the asset based approach and the income approach is 82 million 660 thousand yuan. This evaluation report chooses the result of the asset based approach as the final assessment conclusion.

Securities Times e company reporter noted that 3 housing buildings included in the assessment area were built in 2016 in the Tiancheng project. This building has not yet obtained the warrants and related procedures, with a construction area of up to 10314.36 and a net book value of 59 million 567 thousand and 300 yuan. Jinyu car city announcement said that because the part of the buildings and buildings did not get the relevant approval, there was a risk of being demolished by the government as a violation of the building. The asset appraisal report assessed the above property as 0 yuan.

Jin Yu Cheng disclosed that in November 3rd, the listed company, through competitive consultations, determined the winning unit in the 3 companies invited to bid for the Shanghai Rui Cong Cci Capital Ltd (hereinafter referred to as Rui Cong investment). The transaction amount was 10 thousand yuan, and the transaction agreement with effective conditions has been signed.

What needs to be reminded is that as early as May 2019, the board of directors of Jinyu car city had deliberated and passed the motion on the company's 2019 annual non public development bank stock plan and the motion on selling shares of subsidiary companies and other 10 bills. In fact, the core issue is the sale of Jinyu property by 10 thousand yuan. The successful bidder is investing in Rui Cong. But this asset sale plan has multiple doubts, and also let Kim Yu Che City independent director "fire big" and strongly opposed, and ultimately all bills failed to vote through the shareholders' meeting.

Three questions about asset assessment

"I feel that everyone's financial professional level has been greatly insulted." A person familiar with the matter told the securities times e reporter that after nearly 5 months, Jinyu car city had re adjusted the board of directors, but once again sold a motion of 10 thousand yuan to sell Jinyu real estate. By comparing the two announcements, the reasons for the sale of Jinyu car city and the way of assessment have not changed, and the two bid has been challenged by Rui Cong's investment at the price of 10 thousand yuan, which is doubtful.

When the first announcement was made in June this year, Wang Min, a former independent director of Jinyu car city, had publicly pointed out that Jinyu car city had doubts about the sale of Jinyu real estate equity issues. At present, the pricing principles and principles of the company are not clear. Wang Min himself abstained. On the spot of the shareholders' meeting, the director of Jinyu car city opened the fire on the spot. The relevant materials such as the assets assessment report and audit report published by Jinyu car city found that there were many doubts in the data involved in the motion and so on, and urged shareholders to vote cautiously.

Specifically, the sale of assets by Jin Yu car city mainly involves three important matters: first, in the asset valuation act, the book value of long-term equity investment of Jin Yu property is 7 million 700 thousand yuan, while the assessment company uses telephone and inquiry methods to reduce the value of its long-term equity investment valuation by about 40000000 yuan, resulting in an impairment of assets of 54 million 420 thousand yuan.

Secondly, the results of the asset appraisal show that the book value of Jinyu real estate is about 59000000 yuan, but the value of 3 houses and buildings in fixed assets is 0. According to the lack of related assets formalities, there is a risk of being demolished. Related independent directors believe that without obtaining accurate opinions, the value of this part of the fixed assets is zero, and there is a serious skepticism about the prudence of this judgment. In addition, in May 6th, Jinyu real estate held a resolution of shareholders' meeting to distribute dividends to shareholders 48 million yuan, but this matter needs careful consideration.

According to the company law, corporate profits can be allocated. In 2018, Jinyu real estate financial report was a loss, and before the dividend distribution was made, Jinyu real estate's undistributed profit was only 5200 yuan. Under such circumstances, it is not appropriate to make a dividend of 48 million yuan to shareholders, and these three projects cause Jinyu property impairment value of about 100 million yuan.

People familiar with the matter further pointed out that regrettably, after several months, Jinyu car city did not respond reasonably to the above queries, but continued to restart Jinyu real estate's selling plan.

What is more needed to be reminded is that in October 14, 2019, Jinyu property also made a resolution of 20 million yuan in dividends under the background of poor performance. After considering the matter, the valuation of Jinyu real estate was -2023.67 million yuan. In this regard, Wu Xiaohui, deputy director of Jinyu car city, said that the previous 48 million yuan dividend had been abolished, and this time, considering the sale of Jinyu real estate equity, an unallocated profit distribution was made.

1.57 acres of land is worth only 300 thousand yuan.

By consulting a large number of announcements, the securities times e reporter noted that in May 2019, when Jinyu car city first released Jinyu property appraisal report, it had missed a land asset of the subsidiary company.

2019 semi annual report shows that Jinyu car city in asset clearance inventory work, in July 2019 found Jinyu property 1.57 acres of land not reflected in the book. After preliminary understanding, Jinyu real estate developed and sold land in 2004 and began to handle household property rights in the later stage. The government did not recognize Jinyu real estate's ownership of the 1.57 acres of land, intending to include it in the urban village renovation project, and did not apply for the land use certificate of the 1.57 mu land for Jinyu real estate.

Until December 19, 2013, after many efforts, the local government confirmed Jinyu real estate's ownership of 1.57 acres of land, and handled the land certificate for Jinyu real estate. Jinyu real estate management personnel will be handed over to the record room for land exchange. The financial personnel have not obtained the information from the land certificate, and have not transferred the land cost of the 1.57 mu land which has been amortized to the cost of the built project.

After the land certificate is processed, Jinyu real estate will lease the land outside, but has not received the corresponding rent. According to the arrangement of Jinyu car city, the accounting treatment of this error item is to be demonstrated by the accounting firm. For the rent that has not yet been received, Jinyu city will conduct subsequent processing and disclosure according to the investigation results of the board of supervisors.

According to people familiar with the matter, in the half year of 2019, when the time was last, it was too late to assess the land price. However, the director of Jinyu car city thinks that this is the fact that the land use right of the listed company is actually determined. If it is too late for evaluation, it can be put in the instructions and notes of the intangible assets.

Sure enough, in September 30, 2019, the second assessment report for the benchmark day showed that in 2004, Jinyu city had increased the total amount of land for 6 yuan, including a total of 101 thousand and 900 land (including 1051 and 1.57 acres), and carried out the overall development of the land. In the assessment, the above 1.57 acres of land use right were newly incorporated into the assessment area. Jinyu real estate has also adjusted the land to the intangible assets account.

Securities Times e reporter noted that the second assessment reports only showed that the original value of the 1.57 mu land was 352 thousand yuan, and the net book value was 300 thousand and 600 yuan, and the assessed value was 5 million 370 thousand yuan.

According to people familiar with the matter, Jinyu real estate has not been reflected in the account for a long time. Some executives of listed companies had hoped to conduct accounting treatment through book value, while executives of Nanchong state owned assets believed that the land should be worth 8 million yuan ~1000 million yuan. From the latest assessment report, Jinyu car city in order to sell Jinyu real estate, in essence, is in self harm processing, valuable assets also become worthless, valueless assets even more worthless. Today, Jinyu real estate adds a new land asset, but its share transfer price is still 10 thousand yuan, which is hard to understand.