Securities code: 600520 Securities abbreviation: Tongfeng Electronic Announcement Number: Pro 2021-026

Anhui Tongfeng Electronics Co., LTD
Announcement on implementation of new leasing standards and changes in relevant accounting policies

The board of directors and all the directors of the Company warrant that there is no false record, misleading statement or material omission in the content of this announcement, and bear individual and joint liability for the authenticity, accuracy and completeness of the content.
Important content Tips:
● The accounting policy change is Anhui Tongfeng Electronics Co., LTD. (hereinafter referred to as the "Company") in accordance with the Ministry of Finance of the People's Republic of China (hereinafter referred to as the "Ministry of Finance") in December 2018 revised and issued the Accounting Standards for Business Enterprises No. 21 - Leasing (2018) No. 35) changes.
● This change in accounting policy does not involve the retroactive adjustment of the company in previous years, and will not have a significant impact on the company's total assets, total liabilities, net assets and net profits before this change in accounting policy.
The Company held the sixth meeting of the Ninth Board of Directors and the fifth meeting of the ninth Board of Supervisors on August 26, 2021, deliberating and adopting the Motion on Implementing the New Leasing Standards and changing the relevant accounting policies. The details are as follows:
I. Overview of the accounting policy change
On December 7, 2018, the Ministry of Finance revised and issued the Accounting Standards for Business Enterprises No. 21 - Leasing (Finance and Accounting No. 35, 2018), hereinafter referred to as the "New Leasing Standards", which requires enterprises listed both at home and abroad and enterprises listed abroad to prepare financial statements using International Financial Reporting Standards or accounting Standards for business enterprises. As of January 1, 2019, and other enterprises implementing accounting standards for business enterprises as of January 1, 2021. In accordance with the requirements of the new leasing Guidelines, the Company will implement the new leasing Guidelines effective January 1, 2021.
Ii. Main contents of the accounting policy change
1. Change the accounting policies adopted before
Prior to this change in accounting policies, the accounting policies implemented by the Company were the Accounting Standards for Business Enterprises No. 21 - Leasing issued by the Ministry of Finance in 2006 and other relevant provisions.
2. Accounting policies adopted after the change
After this change of accounting policy, the Company will implement the Accounting Standards for Business Enterprises No. 21, revised and issued by the Ministry of Finance in 2018. The other unchanged parts are still implemented in accordance with the "Accounting Standards for Business Enterprises - Basic Standards" issued by the Ministry of Finance in the early stage and various specific accounting standards, application guidelines of accounting standards for business enterprises, explanatory announcements of accounting standards for business enterprises and other relevant provisions.
3. Change the date
As a domestic listed enterprise, the company will implement the new leasing criteria from January 1, 2021, in accordance with the relevant guidelines and notices of the Ministry of Finance.
Iii. The impact of the change of accounting policies on the Company
1. The main contents of the implementation of the new leasing guidelines include:
(1) Under the new leasing standards, except for short-term leases and low-value asset leases, the lessee will no longer distinguish between finance leases and operating leases, all leases will adopt the same accounting treatment, and the right to use assets and lease liabilities must be recognized;
(2) For the assets with the right to use, if the lessee can reasonably determine that it has acquired the ownership of the leased asset at the end of the lease term, it shall calculate and withdraw depreciation within the remaining service life of the leased asset. If it is not reasonably certain that the ownership of the leased asset can be acquired at the end of the lease term, depreciation shall be deducted within the shorter period of the lease term and the remaining service life of the leased asset. At the same time, the lessee shall determine whether the assets to be used are impaired and make accounting treatment for the identified impairment losses;
(3) For the lease liability, the lessee shall calculate the interest expense of the lease liability during each period of the lease term and record it into the current profit and loss;
(4) For short-term lease and low-value asset lease, the lessee may choose not to recognize the right to use assets and lease liabilities, and record related asset costs or current profits and losses in each period of the lease term according to the straight-line method or other systematic and reasonable methods;
(5) Adjust the relevant content of leasing business in the disclosed financial report in accordance with the requirements of the new leasing standards and listing rules.
2. The impact of the implementation of the new leasing guidelines on the company
This change of accounting policy is made by the Company in accordance with the relevant regulations and requirements issued by the Ministry of Finance. It conforms to the provisions of relevant laws and regulations and the actual situation of the company, does not involve the retrospective adjustment of the company in previous years, and will not have a significant impact on the total assets, total liabilities, net assets and net profits of the company before this change in accounting policies.
Iv. Concluding comments on the change of accounting policies
(1) Opinions of the Board of Directors
The Company held the sixth meeting of the ninth Board of Directors on August 26, 2021, deliberating and adopting the Motion on Implementing the New Leasing Standards and changing relevant Accounting Policies. The Board of Directors believed that: This change in accounting policy is a reasonable change in accordance with the relevant documents and regulations of the Ministry of Finance, in accordance with the relevant regulations of the Ministry of Finance, the China Securities Regulatory Commission and the Shanghai Stock Exchange, which can more objectively and fairly reflect the financial position and operating results of the Company, and is in line with the interests of the Company and all shareholders. The board of directors agreed to the company's accounting policy changes.
(2) Opinions of the Board of Supervisors
The Company held the fifth meeting of the ninth Board of Supervisors on August 26, 2021, deliberating and approving the Motion on Implementing the New Leasing Standards and changing the relevant Accounting Policies. The Board of Supervisors believed that: The change of the company's accounting policies is a reasonable change and adjustment in accordance with the provisions of the relevant documents of the Ministry of Finance. The implementation of the new accounting policies is conducive to objectively and fairly reflecting the company's financial position and operating results. The relevant decision-making procedure is in accordance with relevant laws and regulations, normative documents and the Articles of Association of the Company, and there is no harm to the interests of the company and all shareholders, especially minority shareholders. The Board of Supervisors agrees with the company's accounting policy changes.
(3) Opinions of independent directors
The independent directors of the company agree with the accounting policy changes and express their independent opinions as follows:
1. The change of accounting policies is a reasonable change in accordance with the new leasing standards newly revised and released by the Ministry of Finance.
2. The changed accounting policies of the Company comply with the relevant regulations of the Ministry of Finance, China Securities Regulatory Commission and Shanghai Stock Exchange, which can objectively and fairly reflect the company's current financial position and operating results and have no significant impact on the company's financial position, operating results and cash flow.
3. The decision-making and disclosure procedures of this accounting policy change are in line with relevant regulations, and there is no harm to the interests of the company and all shareholders, especially minority shareholders.
V. File directory for reference
1. Resolution of the sixth meeting of the ninth Board of Directors of the Company;
2. Resolution of the fifth meeting of the Ninth Supervisory Committee of the Company;
3. Opinions of independent directors confirmed by signature of independent directors.
This is to announce.