Offcn Education Technology Co., Ltd. - Annual Report 2021

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OFFCN EDUCATION TECHNOLOGY CO., LTD. 2021 Annual Report

Stock Code: 002607

Stock Abbr.: OFFCN EDU

April, 2022

Chapter 1 Important Information, Table of Contents and Definitions

The Company’s Board of Directors, Supervisory Committee, directors, supervisors, and senior management hereby guarantee that the contents of the annual report are true, accurate, and complete, and that there are no misrepresentations, misleading statements, or material omissions, and shall assume individual and joint legal liabilities.

Wang Zhendong, the Company’s legal representative, Shi Lei, head in charge of accounting and Luo Xue, head of the accounting department (Accounting supervisor), declare that they warrant the truthfulness, accuracy and completeness of the financial report in the annual report.

All directors attended the board meeting for reviewing this report.

The forward-looking statements on future plans and development strategies involved in this report do not constitute a substantial commitment to investors. Investors are advised to invest rationally and pay attention to the potential investment risks.

The possible risks and countermeasures have been detailed in Section XI Forcast of the Company ’s future development ” of Chapter 3 Management Discussion and Analysis of this report. Investors are advised to pay attention to the relevant contents.

On December 25, 2021, the Company was filed and investigated by China Securities Regulatory Commission (CSRC) on suspicion of failing to disclose related party transaction information and violating the laws and regulations of information disclosure. On April 27, 2022, the Company and the relevant parties received the official Decision of Administrative Penalty. The Anhui Securities Regulatory Bureau of the CSRC decided to give a warning to and impose a fine on the Company and the relevant parties, and order the Company and the relevant parties to rectify the situation. Specific information is stated in the announcement (No. 2022-032) disclosed on CNINFO (www.cninfo.com.cn) and other designated media.

The Company plans not to distribute cash dividends, bonus shares, nor to increase share capital by converting capital reserve.

The English version of this report is provided together with the Chinese version. Should there be any inconsistency between the Chinese version and the English version, the Chinese version shall prevail.

Offcn Education Technology Co., Ltd. 2021 Annual Report

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Chapter	1	Important Information, Table of Contents and Definitions..............................................1
Chapter	2	Corporate Profile & Key Financial Indicators................................................................. 5
Chapter	3	Management Discussion and Analysis...........................................................................10
Chapter	4	Corporate Governance....................................................................................................37
Chapter	5	Environmental and social responsibilities......................................................................62
Chapter	6	Significant Events...........................................................................................................63
Chapter	7	Share Changes and Shareholders................................................................................... 93
Chapter	8	Preferred Shares........................................................................................................... 101
Chapter	9	Corporate Bonds...........................................................................................................102
Chapter	10	Financial Statements...................................................................................................103

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Documents Available for Reference

I. The financial statement signed and sealed by the legal representative of the Company, the person in charge of accounting work and the person in charge of accounting department (accounting supervisor).

II. The original copy of the audit report signed and sealed by the auditors and sealed by the accounting firm.

III. The full text of 2021 Annual Report signed by Wang Zhendong, the Company’s legal representative.

IV. The original copies of all the documents of the Company which have been disclosed in newspapers designated by the China Securities Regulatory Commission during the reporting period.

V. The place where the above-mentioned documents are maintained: the office of the Company’s Secretary of the Board of Directors.

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Definitions

Term(s)	Definition
The listed Company, The Company, Offcn Edu	Offcn Education Technology Co., Ltd.
CSRC	China Securities Regulatory Commission
Company Law	Company Law of the People’s Republic of China
Securities Law	Securities Law of the People’s Republic of China
Articles of Corporation	Articles of Corporation of Offcn Education Technology Co., Ltd.
Yuan, 10 thousand yuan, 100 million yuan	RMB yuan, RMB 10 thousand yuan, RMB 100 million yuan
This major assets restructuring, This transaction, This restructuring	Base on the assessment, Yaxia Auto takes all assets and liabilities other than retained assets as the exchange-out assets to swap the equivalent portion of 100% equity of Offcn which held by Li Yongxin and other 10 counterparties, and the swapping deficiency is settled by issuance of Yaxia Auto shares according to the proportion of shareholding. At the same time, Yaxia Industrial transfers 80,000,000 and 72,696,561 Yaxia Auto shares to Offcn Partnership and Li Yongxin respectively. All shareholders of Offcn entrust Yaxia Auto to directly deliver the exchange-out assets to Yaxia Industrial or its designated third party as the consideration for the transfer of 80,000,000 shares to Offcn Partnership, and Li Yongxin offers RMB1 billion in cash as the consideration for the transfer of 72,696,561 shares.
Aerospace Industry	Beijing Aerospace Industry Investment Fund (Limited Partnership)
Guangyin Venture	Beijing Guangyin Venture Capital Center (Limited Partnership)
Kerui Technology Innovation	Beijing Kerui Technology Innovation Investment Center (Limited Partnership)
Offcn Partnership	Beijing Offcn Future Information Consulting Center (Limited Partnership), established by all shareholders of Offcn Ltd. in accordance with the shareholdings ratio, which is used to undertake 80,000,000 shares of the listed Company transferred by Yaxia Industrial.
Yaxia Industrial	Anhui Yaxia Industrial Co., Ltd.

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Chapter 2 Corporate Profile & Key Financial Indicators

Section I. Corporate profile

Stock Abbreviation	OFFCN EDU	Stock Code	002607
Changed Stock Abbreviation (if any)	/
Listed Stock Exchange	Shenzhen Stock Exchange
Chinese Name of the Company	中公教育科技股份有限公司
Chinese Name Abbreviation of the Company	中公教育
English Name of the Company (if any)	Offcn Education Technology Co., Ltd.
English Name Abbreviation of the Company (if any)	OFFCN EDU
Legal Representative of the Company	Wang Zhendong
Registered Address	Yaxia Automobile City, Yijiang North Road, Jiujiang District, Wuhu City, Anhui Province
Zip Code of Registered Address	241000
Changed Registered Address of the Company (if any)	/
Office Address	Block B, Hanhua Century Mansion, No.23 Xueqing Road, Haidian District, Beijing
Zip Code of Office Address	100089
Company Website	http://www.offcn.com
E-mail	[email protected]

Section II. Contact information

	Board Secretary	Securities Affairs Representative
Name	Gui Hongzhi	Gu Pan
Address	Block B, Hanhua Century Mansion, No.23 Xueqing Road, Haidian District, Beijing	Block B, Hanhua Century Mansion, No.23 Xueqing Road, Haidian District, Beijing
Tel.	010-83433677	010-83433688
Fax	010-83433666	010-83433666
E-mail	[email protected]	[email protected]

Section III. Information disclosure and location of Annual Report

Company’s Designated Information Disclosure Media Securities Times, Shanghai Securities News and China Securities

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	Journal
Website Designated by the China Securities Regulatory Commission for Publishing the Annual Report	http://www.cninfo.com.cn
Place Where the Annual Report is Available for Inspection	Office of Secretary of the Board

Section IV. Registration Changes

Organization Code	91340200711040703A
Changes in Main Business Since the Company’s Listing (if any)	None
Change of Previous Controlling Shareholders (if any)	None

Section V. Other relevant information

Accounting firm hired by the Company

Accounting Firm Name	Baker Tilly China Certified Public Accountants (LLP)
Office Address of the Accounting Firm	No.12 Building, Foreign Cultural and Creative Garden, No.19 Chegongzhuang West Road, Haidian District, Beijing, China
Signing Accountants’ Names	Zhou Baiming, Li Qiang

Sponsor institution engaged by the Company to perform continuous supervision duties during the reporting period □ Applicable √ Not applicable

Financial advisor engaged by the Company to perform continuous supervision duties during the reporting period √ Applicable □ Not applicable

Financial Advisor	Office Address	Financial advisor sponsor	Continuous Supervision Period
Huatai Securities Co., Ltd.	26th Floor, CTS Building, NO.4011 Shennan Avenue, Futian District, Shenzhen, Guangdong, China	Cui Binbin, Cui Li	Nov. 28, 2018 - Dec.31, 2021

Section VI. Key Accounting Information and Financial Indicators

Does the Company need to adjust its financial data retrospectively or restate its accounting data of previous year? □ Yes √ No

Year 2021	Year 2020	Increase/Decrease over the previous year	Year 2019
6,911,723,331.79	11,202,494,295.04	-38.30%	9,176,129,995.89
-2,369,509,039.00	2,304,357,742.74	-202.83%	1,804,548,688.01
-2,485,630,452.04	1,867,289,479.85	-233.11%	1,700,369,663.16

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-4,097,961,548.90	4,882,469,101.91	-183.93%	2,473,986,085.19
-0.38	0.37	-202.70%	0.29
-0.38	0.37	-202.70%	0.29
-76.88%	66.15%	-143.03%	60.71%
Year End 2021	Year End 2020	Increase/Decrease Over Previous Year End	Year End 2019
10,305,183,525.70	14,418,850,027.27	-28.53%	9,960,705,427.94
1,888,818,754.20	4,275,127,793.20	-55.82%	3,431,545,903.82

The lower of the net profit of the Company before and after deduction of non-recurring profits and losses for the most recent three financial years is negative, and the audit report of the most recent year shows that there are uncertainties on the Company’s ability to continue operations

□ Yes √ No

The lower of the net profit before and after deduction of non-recurring profits and losses is negative

√ Yes □ No

Item	Year 2021	Year 2020	Note
Operating income (RMB yuan)	6,911,723,331.79	11,202,494,295.04	None
Deduction from operating income (RMB yuan)	51,440,960.49	63,592,576.33	In this reporting period, the deductions of operating income include: Deduction of hotel income RMB 28,379,224.72; Deduction of house leasing income RMB 19,285,714.29; Deduction of exhibition income RMB 3,364,150.85; Deduction of custody income RMB 226,415.10; Deduction of other income RMB 185,455.53.
Operating income after deduction (RMB yuan)	6,860,282,371.30	11,138,901,718.71	In this reporting period, the deduction of operating income includes: Deduction of hotel income RMB 28,379,224.72; Deduction of house leasing income RMB 19,285,714.29; Deduction of exhibition income RMB 3,364,150.85; Deduction of custody income RMB 226,415.10; Deduction of other income RMB 185,455.53.

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Section VII. Differences in accounting data under domestic and overseas accounting standards

1. Differences between net profits and net assets disclosed in the financial reports in accordance with Chinese accounting standards and international accounting standards

□ Applicable √ Not applicable

There is no difference between the net profits and net assets disclosed in accordance with Chinese accounting standards and those disclosed in accordance with international accounting standards in the reporting period.

2. Differences between net profits and net assets disclosed in the financial reports in accordance with Chinese accounting standards and overseas accounting standards

□ Applicable √ Not applicable

There is no difference between the net profits and net assets disclosed in accordance with Chinese accounting standards and those disclosed in accordance with overseas accounting standards in the reporting period.

Section VIII. Quarterly Key Financial Indicators

Unit: RMB

	The First Quarter	The Second Quarter	The Third Quarter	The Fourth Quarter
Operating income	2,051,691,383.47	2,804,306,880.03	1,445,195,855.92	610,529,212.37
Net profit attributable to shareholders of the listed Company	140,729,639.84	-237,892,148.87	-793,735,635.02	-1,478,610,894.95
Net profit after deducting non-recurring profits and losses attributable to shareholders of the listed Company	92,213,329.43	-262,118,353.21	-798,108,362.10	-1,517,617,066.16
Net cash flow from operating activities	-246,724,873.67	-692,366,584.28	-2,706,728,725.77	-452,141,365.18

Do the above financial indicators or their total differ significantly from those stated in the Company’s disclosed quarterly and semi-annual reports?

□Yes √No

Section IX. Non-Recurring Profits and Losses

√Applicable □Not applicable

Unit: RMB

Item	Year 2021	Year 2020	Year 2019	Note
Profits or losses on disposal of non-current assets (including offsetting amount for the provision of	-136,455.49	162,043.59	182,904.69

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Offcn Education Technology Co., Ltd. 2021 Annual Report

impairment of assets)
Government grants included in current profit or loss (except those closely related to the Company's normal business operations, which are in accordance with national policies and continuously enjoyed in accordance with certain standards or quotas)	27,496,339.83	20,128,697.09	472,098.91
Capital occupation fees charged to non-financial enterprises included in current profit and loss		13,192,187.13
Profit or loss from entrusting others to invest or manage assets	56,955,660.58	180,223,310.57	184,130,073.02
Except the effective hedging business related to the Company’s normal business operations, profits or losses on changes in fair value arising from the possession of transactional financial assets and transactional financial liabilities; and the investment income from the disposal of transactional financial assets, transactional financial liabilities and financial assets available for sale	-21,490,322.52	20,984,385.76	1,712,787.50
Custody income from entrusted operations	226,415.10	226,415.09	411,320.75
Other non-operating income and expenses except for the items above	16,837,313.42	-629,138.85	-1,341,412.25
Other profit or loss items that meet the definition of non-recurring profits and losses	60,675,060.38	280,283,117.41	-53,800,000.00
Less: Impact on income tax	24,442,598.26	76,183,536.19	27,588,747.77
Impact on minority shareholders’ equity (after tax)		1,319,218.71
Total	116,121,413.04	437,068,262.89	104,179,024.85	--

Details of other profit and loss items that meet the definition of non-recurring profits or losses. √Applicable □Not applicable

RMB 60,293,558.79 of VAT exempted in accordance with the Announcement on Tax Policies Related to Supporting the Prevention and Control of Pneumonia Outbreaks of Covid-19 (Announcement No. 8 [2020] of the Ministry of Finance and State Taxation Administration of The People's Republic of China) ;

RMB 355,925.19 of input tax credits in accordance with the Announcement on Policies Related to Deepening VAT Reform (Announcement No. 39 [2019] of the Ministry of Finance, State Taxation Administration, and General Administration of Customs of The People's Republic of China) ;

RMB 25,576.40 gained from remeasuring the remaining equity at fair value after the loss of control of Beijing Offcn Future Education Technology Co., Ltd..

Provide explanations for classifying items of non-recurring profits or losses defined or listed in the Explanatory — Announcement No. 1 for Information Disclosures of the Company Issuing Securities Publicly Non-recurring Profits and Losses as items of recurring profits or losses.

□ Applicable √ Not applicable

The Company has not classified non-recurring profit or loss items defined or listed in the Explanatory

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— Announcement No. 1 for Information Disclosures of the Company Issuing Securities Publicly Non-recurring profits and losses as recurring profit or loss items in the reporting period.

Chapter 3 Management Discussion and Analysis

Section I. The industry situation of the Company during the reporting period

1. The “14th Five-Year Plan” requires that the quality and capacity of education, medical care, elderly care and other services be greatly improved.

In terms of education, the “14th Five-Year Plan” requires to greatly improve education equality and quality; promote the popularization of higher education, create more than 60 million new jobs in cities and towns; build, renovate or expand 20,000 kindergartens to increase enrollments by over 4 million for ordinary families; and build, renovate or expand more than 4,000 primary and secondary schools. In terms of medical and health care, it requires to expand disease prevention and control bases and build national and regional medical centers, and strive to upgrade 500 county-level hospitals to meet the facilities and service capabilities of top-tier hospitals. In terms of elderly care service, 500 districts and counties will be supported in building a model community home elderly care service network, about 300 training and convalescent institutions will be supported in transformation into inclusive elderly care institutions, and more nursing beds will be provided for about 1,000 public elderly care institutions. In terms of childcare service, 150 cities will be supported to develop childcare service with social resource, and more than 500,000 exemplary inclusive childcare enrollments will be added. All of these investments mentioned above will strongly promote the sustainable growth of the recruitment sectors, especially the recruitment sectors of teachers, medical staff and community workers.

2. With more policy support, the operation of improving vocational skills speeds up.

Since the “14th Five-Year Plan”started, the new economic layout of pursuing high-quality development has put forward higher demand for the upgrading and adjustment of China’s industrial structure. Industry boundaries are constantly broken, and knowledge and skills in different fields intersect with each other increasingly. The demand of all kinds of enterprises for inter-disciplinary, innovative and highly skilled talents keeps increasing.

In terms of industry policies, in May 2019, the General Office of the State Council issued the Course of Action for Vocational Skills Improvement (2019-2021), which specifies that the operation of improving vocational skills is an important livelihood project. After that, relevant policies were issued one after another:

In March 2021, the Outline of the People’s Republic of China 14th Five-Year Plan for National Economic and Social Development and Long-Range Objectives for 2035 issued by the General Office of Central Committee of CPC and the General Office of State Council requires to improve the life-long skills training system and continue to carry out vocational skills training on a large scale. The Outline also requires to carry out the action for vocational skills improvement and special training plan for key groups in a deeper level, extensively carry out skills training for employees from business of new forms and new models and improve the training quality effectively.

In October 2021, the Opinions on Promoting the High-quality Development of Modern Vocational Education issued by the General Office of Central Committee of CPC and the General Office of State Council suggests

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promoting the construction of a skill-oriented society, improving the social status of technical and skilled talents, and enhancing the attractiveness and training quality of vocational education, and makes it clear that the enrollment of vocational undergraduate education shouldn’t be less than 10% of the enrollment of higher vocational education. Listed companies and leading enterprises in the industry are encouraged to take the lead in providing vocational education, and all kinds of enterprises are encouraged to participate and play a role in vocational education legally.

In December 2021, the “14th Five-Year Plan” Vocational Skills Training Plan jointly issued by the Ministry of Human Resources and Social Security, the Ministry of Education, the National Development and Reform Commission and the Ministry of Finance specifies again that carrying out large-scale training for vocational skills is an important measure to improve the employment and entrepreneurial ability of laborers, alleviate structural employment contradictions and promote the expansion of employment, and it is also an essential support for advancing development with high quality.

This year’s government’s work report also suggests continuing to carry out large-scale training for vocational skills, and jointly building and sharing a batch of public training bases. 100-billion-yuan unemployment insurance fund should be used for stabilizing employment and training, and accelerating the training of urgently-needed talents for the high-quality development of the manufacturing industry to make more laborers possess a professional skill and more talents emerge in all walks of life.

3. Main industry characteristics and cyclical characteristics

The institutions of vocational education distribute vastly all over the country. Such situation lifts the barriers to competition in this field. The demand of vocational education distributes vastly in every province and every city, especially in the prefecture-level cities and the counties. Almost every county has a vocational high school, and every prefecture-level city has vocational colleges. The recruitment demand for civil servants also comes in large numbers from prefecture-level cities and counties. This has given rise to a large number of local small and medium-sized training institutions, and provided large institutions with a wide space to expand their channel networks, while making management difficulties and barriers to competition suddenly higher.

The training for civil servant recruitment tests is seasonal. For trainees, the 1-2 years before or after their graduation are the key period to take training classes for the recruitment tests. The national civil servant test takes place once a year, and the provincial examinations for each province basically take place once a year, while few provinces will have another joint examination to recruit civil servants in the second half year. And the recruitment of public institution employees and teachers are carried out according to the needs of the provinces and cities, which are distributed in each month throughout the year uncertainly. The documents of recruitment plan are of a great amount.

This seasonal fluctuation of recruitment has caused major growth bottlenecks for small and medium-sized training institutions and has also provided large institutions with continuous motivation to constantly challenge the scale boundary. With the rapid increase in examination categories and business sectors, large institutions will increasingly enjoy the benefits of scale effects and obtain a more sound resource allocation structure. In recent years, the momentum of recruitment examinations has switched to new areas such as public institutions, teachers and comprehensive recruitment, bringing the rapid concentration of market share into leading enterprises.

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Section II. The Company’s main business during the reporting period

Offcn Edu is a large-scale multi-category vocational education institution, and it is also the pioneer and leader in the field of public service recruitment examination training in the country. The Company bravely undertakes the mission of the times, continues to create new markets, and serves the society with kindness and altruism.

Offcn Edu mainly serves knowledge-based employment population including college students, university graduates, and various professionals, aged 18 to 45. This huge group of hundreds of millions of people is spread throughout the country, cities and towns at all levels and in all walks of life. Employment and vocational ability improvement are their two core demands.

For hundreds of millions of knowledge-based people and based on their two core demands, the Company’s main business covers three major sectors including training for public service recruitment examinations, college and high institution enrollment examinations and vocational ability enhancement, and it provides more than 100 categories of comprehensive vocational training service. The Company has more than 1,500 outlets across the country, covering more than 300 prefecture-level cities, and is steadily expanding into thousands of counties and universities.

After a long-term exploration and accumulation, Offcn Edu has owned a large-scale full-time R&D team of more than 2,000 people, a large-scale teaching team of more than 14,000 teachers, and a staff of more than 36,000 people. Relying on its outstanding team execution and nationwide vertical integrated fast response capability, the Company has developed into an innovation-driven enterprise platform.

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Section III. Analysis of the Company’s core competitiveness

The Company's core competitiveness lies in the formation of an enterprise platform driven by the capability of vertically integrated fast response. The key driving factors are as follows:

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1. Clustered professional R&D continuously outputs momentum for innovation

At the beginning of the career, the Company took the lead in carrying out full-time and professional R&D, based on which it created a brand-new market. Over the past decade, the Company has fostered an expert team with rich practical experience in R&D and R&D management through front-line teaching practice and adaption to market upgrading. Under the joint lead of the founding team and the expert team, a full-time R&D team of more than 2,000 people has formed. With the expansion of categories and the involvement of different sectors, the Company's professional R&D not only achieves the continuous division of labor under the scale effect, but also constantly creates R&D cluster effect of collaboration between categories, which greatly improves the efficiency of R&D, especially the grafting efficiency of using stock R&D resources in new categories and new businesses.

2. Vertical integrated fast response capability supports the Company ’s sustainable operation structurally and efficiently.

The high operation efficiency far beyond the general industries is a necessity to realize scale economy and establish competitive barrier in the decentralized market. Therefore, vertical integrated fast response system and capability can best adapt to this kind of market environment. In each exam, ‘Business outlets — Headquarters command center — Teaching sites ’ are giving responses and feedback with high frequency every day. Thus, management and learning effect far above the average can be realized.

Vertical integrated corporate structure can not only realize the high efficiency of operation, but also be effectively compatible with the management impact brought by rapid business category expansion. So investment

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in and innovation on this corporate structure has always been a central part of the management reform. At present, Offcn Edu has established more than 1,500 business outlets covering 300 prefecture-level cities. Simultaneously, the headquarters command center continues to seek the scale effect of management with the help of management reform and digital operation. In recent years, Offcn Edu has also continuously invested in the construction of large-scale one-stop bases for food, housing and learning to promote the realization of large-scale factory operation on the teaching sites.

3. Digital operation forms the enterprise platform with “real-time situational awareness”

The team ’s exploration for digital operation has lasted for more than 15 years, and in recent years, the investment scale for digital operation infrastructure has increased significantly. One reason is to meet the management needs for rapid expansion of categories. The other reason lies in the great adaptability of vertically integrated fast response system to the digitization. After the system was integrated with the digitization in depth, it generated higher operating efficiency and significantly improved the foreground and background response frequency from units of days to a level close to “real-time situational awareness”, which enhanced the Company’s core competitiveness based on speed economy.

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4. The values of kindness and altruism allow the Company to maintain strong organizational cohesion in high growth

As a knowledgeable staff-intensive vocational education institution, the Company has established a concise and effective corporate culture in the long journey of arduous entrepreneurship, with the core value of “Be Kind &

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Do Right” and advocating altruism. Not only has it become a company system, but also the founding team has taken the lead to set an example, influenced the staff level by level, and unswervingly implemented it in the operation, making the values of Offcn Edu ubiquitous and flourishing in the enterprise. This distinctive and tangible corporate culture allows the Company to maintain strong organizational cohesion.

5. Offcn Edu strives to strengthen the Party's construction to promote the healthy and vigorous development of the Company

From the establishment of the Party committee in 2018 to the founding of the first Party school of non-public-owned enterprise in 2019, the Party committee of Offcn Edu has fully utilized the Company ’ s advantages of knowledge, theory, and technology and actively promotes and implements the Party’s political routes, principles, and policies to employees and students. Meanwhile, Offcn Edu focuses on the integration of the Party building of non-public enterprises and corporate culture cultivation to promote the healthy and vigorous development of the enterprise.

As of December 31, 2021, the Company had more than 7,000 Party members, accounting for more than one-fifth of the total number of employees.

Section IV. Core business analysis

1. Overview

(1) Impacted by the pandemic, market demand has shrunk, and the performance of the Company in the current period has appeared great fluctuation.

In 2021, the market of education and training has suffered great fluctuations. At the industry level, impacted by the pandemic and economy, the phenomena of cyclical fluctuations of exams, shrinking market demand, and students’ weakening willingness to attend training occur in the industry of talent recruitment training. The industry shows a sign of overall contraction, which challenges the stability of corporate operations. In terms of the Company, influenced by the appearance of sporadic cases and cluster cases of COVID-19 in some areas, the Company’s outlets and learning centers in more than 20 provinces including Heilongjiang, Jiangsu, Shaanxi, Jilin, and Henan were closed periodically and couldn’t operate normally in 2021. In addition, because the Company’s management team was too optimistic about the market situation and didn’t adjust the business plan timely, the tuition refunds increased sharply and the cost remained high, resulting in a substantial increase of refund rate in year 2021 compared with year 2020 and a great fluctuation in the Company’s current period performance.

During the current reporting period, the Company achieved a total operating income of RMB 6.9117233 billion yuan, a 38.30% year-on-year decrease. Net profit attributable to shareholders of the listed Company was

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RMB -2.369509 billion yuan, a decrease of 202.83% over the same period of the previous year. After deducting non-recurring profits and losses, net profit attributable to the parent company’s shareholders was RMB -2.4856305 billion yuan, a decrease of 233.11% on an annual basis. In the next stage, the Company will actively rectify the situation and launch the 2022 business boost plan. The measures of optimizing interior by reducing cost and improving efficiency, adjusting structural product and accelerating new business development will be taken to lead the Company back on track as soon as possible.

The key operating resources and performance indicators during the reporting period are stated in the table below:

Item	Indicators	At the end of the reporting period	At the end of last year	The increase or decrease at the end of the reporting period from the end of the previous year
Operating resources	Directly-operated branches	1,508	1,669	-9.65%
	Employees	36,143	45,066	-19.80%
	R&D personnel	2,452	3,025	-18.94%
	Teachers	14,590	18,863	-22.65%
Item	Indicators	At the end of the reporting period	The same period of last year	The increase or decrease in the reporting period from the same period of the previous year
Business and profits	Revenue of face-to-face training (RMB yuan)	4,380,182,147.02	8,233,444,798.58	-46.80%
	Revenue of online training (RMB yuan)	2,480,100,224.28	2,905,456,920.13	-14.64%
	Number of training participants	3,849,035	4,494,348	-14.36%
	Operating income (RMB yuan)	6,911,723,331.79	11,202,494,295.04	-38.30%
	Net profits attributable to shareholders of the listed Company (RMB yuan)	-2,369,509,039.00	2,304,357,742.74	-202.83%

(2) New business sector develops steadily and the return on upfront investment appears.

All along, the Company has been continuously injecting intensive resources into active new businesses, especially forward-looking strategic investments in key categories such as academic backgrounds upgrading, training for medical qualifications, and IT training. With the continuous investments of resources and growing maturity of the talent pool, the revenue proportion of training sector for other public service exams and new businesses is increasing gradually. During the reporting period, the comprehensive sector achieved a revenue of

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RMB 1.669751 billion yuan, which made up 24.16% of the total revenue, an increase from the 15.90% of the same period in the previous year.

2. Revenue and cost

(1) Composition of revenue

Unit: RMB yuan

	2021	2021	2020	2020	Increase/ Decrease over the previous year
	Amount	Proportion of Revenue	Amount	Proportion of Revenue
Revenue	6,911,723,331.79	100%	11,202,494,295.04	100%	-38.30%
Sectors
Educational training	6,860,282,371.30	99.26%	11,138,901,718.71	99.43%	-38.41%
Others	51,440,960.49	0.74%	63,592,576.33	0.57%	-19.11%
Categories of product
Training for Civil Servant Test	3,368,861,256.89	48.74%	6,289,564,053.54	56.14%	-46.44%
Training for Public Institution Test	1,019,282,962.72	14.75%	1,273,504,970.82	11.37%	-19.96%
Training for Teachers’ Recruitment Test	802,387,194.18	11.61%	1,794,466,441.92	16.02%	-55.29%
Training for other public services test and new businesses	1,669,750,957.51	24.16%	1,781,366,252.43	15.90%	-6.27%
Others	51,440,960.49	0.74%	63,592,576.33	0.57%	-19.11%
Regions
Northeast China	891,663,394.84	12.90%	1,575,156,348.27	14.06%	-43.39%
North China	1,172,797,204.47	16.97%	1,875,752,184.53	16.74%	-37.48%
East China	1,687,969,176.80	24.42%	2,654,580,800.73	23.70%	-36.41%
Middle China	850,590,365.27	12.31%	1,349,672,939.31	12.05%	-36.98%
South China	571,708,625.26	8.27%	1,016,364,626.14	9.07%	-43.75%
Southwest Region	907,397,421.66	13.13%	1,403,667,569.50	12.53%	-35.36%
Northwest China	778,156,183.00	11.26%	1,263,707,250.23	11.28%	-38.42%
Others	51,440,960.49	0.74%	63,592,576.33	0.57%	-19.11%
Sales models
Direct sales	6,911,723,331.79	100.00%	11,202,494,295.04	100.00%	-38.30%

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(2) Particulars of sectors, products, regions and sales models that account for more than 10% of the operating revenue or profits

□Applicable √Not applicable

(3) Is the Company’s goods sales income greater than that of labor services?

□Yes √No

(4) Fulfillment of significant sales contracts and purchase contracts signed by the Company as of the reporting period

□Applicable √Not applicable

(5) Composition of operating cost

Categories of industry

Unit: RMB yuan

Industries	Items	2021	2021	2020	2020	Year-on-ye ar Increase/ Decrease
		Amount	Proportion of operating costs	Amount	Proportion of operating costs
Education training	Cost of operation	4,945,732,913.85	99.04%	4,513,636,084.16	98.82%	9.57%
Others	Cost of operation	47,984,449.73	0.96%	53,690,847.28	1.18%	-10.63%

Statements

None

(6) Did the scope of consolidation change during the reporting period?

√Yes □No

Full name of the subsidiary 1. Lu’an Yazhong Real Estate Information Consulting Co., Ltd. 2. Lu’an Zhongke Real Estate Information Consulting Co., Ltd. 3. Wenling Offcn Information Consulting Co., Ltd. 4. Anshan Tiedong Offcn Education Training School Co., Ltd. 5. Diqing Offcn Training School Co., Ltd. 6. Dali Offcn Education Training School Co., Ltd. 7. Harbin Nangang Offcn Education Training School Co., Ltd. 8. Nujiang Offcn Training School Co., Ltd. 9. Weixi Offcn Education Training School Co., Ltd. 10. Beijing Offcn Century Education Technology Co., Ltd. 11. Beijing Offcn Future Education Technology Co., Ltd.	Proportion of shareholding (%)	Reason for changes
	100	Acquisition
	100	Acquisition
	100	New establishment
	100	New establishment
	100	New establishment
	100	New establishment
	100	New establishment
	100	New establishment
	100	New establishment
	100	New establishment
	49.00	Transferred

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(7) Major changes or adjustments to the Company’s business, products, or services during the reporting period

□Applicable √Not applicable

(8) Major customers and major suppliers

Information about major customers

Information about major customers
Total sales amount of the top five customers (RMB yuan)	605,618.91
The ratio of the total sales amount of the top five customers to the total annual sales amount	0.01%
The ratio of the sales amount of related parties in the sales amount of the top five customers to the total annual sales amount	0.00%

Information about the top 5 customers

SN	Customer	Sales amount (RMB)	Ratio to the total annual sales amount
1	Customer 1	130,296.72	0.00%
2	Customer 2	130,019.42	0.00%
3	Customer 3	119,768.79	0.00%
4	Customer 4	115,242.72	0.00%
5	Customer 5	110,291.26	0.00%
Total	--	605,618.91	0.01%

Other information regarding major customers

□Applicable √Not applicable

Information regarding major suppliers

Information regarding major suppliers
Total purchase amount of the top five suppliers (RMB yuan)	406,493,953.25
The ratio of the total purchase amount of the top five suppliers to the total annual purchase amount	9.63%
The ratio of the purchase amount of related parties in the purchase amount of the top five suppliers to the total annual purchase amount	0.00%

Information regarding the top 5 suppliers

SN	Supplier	Purchase Amount (RMB)	Ratio to the total annual purchase amount
1	Supplier 1	194,154,388.30	4.60%
2	Supplier 2	128,012,500.00	3.03%
3	Supplier 3	30,901,945.00	0.73%
4	Supplier 4	27,285,618.00	0.65%

	Offcn Education TechnologyCo.,Ltd. 2021 Annual Report	Offcn Education TechnologyCo.,Ltd. 2021 Annual Report	Offcn Education TechnologyCo.,Ltd. 2021 Annual Report	Offcn Education TechnologyCo.,Ltd. 2021 Annual Report
	5	Supplier 5	26,139,501.95	0.62%
	Total	--	406,493,953.25	9.63%

Other information about major suppliers

□Applicable √Not applicable

3. Expenses

Unit: RMB yuan

	Year 2021	Year 2020	Year-on-year Increase/ Decrease	Description on major changes
Sales expenses	2,105,098,912.06	1,811,790,113.16	16.19%	Mainly due to the expiration of the social insurance exemption, the increase in employees' salaries, the opening of new workplace, and the increase in the amortization of rental property during the epidemic period
Management expenses	1,315,643,022.03	1,279,869,207.37	2.80%	No major changes
Financial expenses	491,614,471.98	430,548,689.17	14.18%	Mainly due to short-term interest on borrowings and the amortization of unrecognized financing expenses to financial expenses according to the New Lease Standard
R&D expenses	901,469,538.57	1,050,697,333.79	-14.20%	Mainly due to the operating losses in this period, the decrease of R&D personnel and the reduction of the total salary due to the position transfer of teachers to R&D

4. R&D investment

√Applicable □Not applicable

Name of Projects	Purpose of projects	Progress of projects	Goals to be achieved	Potential influence on the Company’s development
Basic research and development of curriculum system	Enrich the Company's curriculum system to achieve a diversified curriculum portfolio	Obtained partial objective	Enrich the Company's curriculum system to achieve a diversified curriculum portfolio	Provide different product portfolios to enhance students’ learning outcome and to improve the Company’s core competitiveness
Research and development of	By developing platform systems and client APPs,	Obtained partial	By developing platform systems and client APPs,	Promote the deep matching of digital management and

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infrastructure for digital operation	provide technical support for the transformation of business digitization	objective	provide technical support for the transformation of business digitization	vertically integrated fast response system, seek for higher level of efficient fast response with the power of digital management, and further enhance the core competitiveness of the Company based on speed economy

R&D staff

	2021	2020	Year-on-year Increase/ Decrease
Numbers of R&D staff	2,452	3,025	-18.94%
Proportion of R&D staff	6.78%	6.71%	0.07%
Education background of R&D staff	——	——	——
Bachelor degree	1,665	2,620	-36.45%
Master degree	778	400	94.50%
Others	9	5	80.00%
Age of R&D staff	——	——	——
Below 30 years old	1,052	1,841	-42.86%
30-40 years old	1,344	1,128	19.15%
Above 40 years old	56	56	0.00%
Investments in R&D

	Year 2021	Year 2020	Year-on-year Increase/ Decrease
R&D investment amount (RMB yuan)	901,469,538.57	1,050,697,333.79	-14.20%
The proportion of R&D investment in revenue	13.04%	9.38%	3.66%
Amount of capitalized R&D investment (RMB yuan)	0.00	0.00	0.00%
The proportion of Capitalized R&D investment in R&D investment	0.00%	0.00%	0.00%

Reasons and effects of major changes in the composition of the Company's R&D personnel

□Applicable √Not applicable

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Reason for a significant change of the proportion of total R&D investment in revenue from that of the last year

□Applicable √Not applicable

Reason and statement for the significant change in capitalization rate of R&D investment

□Applicable √Not applicable

5. Cash flow

Unit: RMB yuan

Item	Year 2021	Year 2020	Year-on-year Increase/ Decrease
Sub-total of cash inflows from operating activities	5,344,505,574.24	14,170,455,842.47	-62.28%
Sub-total of cash outflows from operating activities	9,442,467,123.14	9,287,986,740.56	1.66%
Net cash flows from operating activities	-4,097,961,548.90	4,882,469,101.91	-183.93%
Sub-total of cash inflows from investing activities	9,419,573,425.23	41,450,131,085.26	-77.27%
Sub-total of cash outflows from investing activities	7,679,034,155.42	42,558,772,286.98	-81.96%
Net cash flows from investing activities	1,740,539,269.81	-1,108,641,201.72	257.00%
Sub-total of cash inflows from financing activities	4,569,000,000.00	5,270,000,000.00	-13.30%
Sub-total of cash outflows from financing activities	6,191,808,200.47	5,818,126,412.65	6.42%
Net cash flows from financing activities	-1,622,808,200.47	-548,126,412.65	-196.06%
Net increase in cash and cash equivalents	-3,980,230,479.56	3,225,701,487.54	-223.39%

Main influencing factors of major year-on-year changes in relevant data

√Applicable □Not applicable

(1) The net cash flows from operating activities decreased by RMB 8.9804307 billion yuan, a 183.93% year-on-year decrease. It was mainly due to the lower-than-expected business receipts of the Company, the rapid growth of students’ refunds and the sharp decline of business income.

(2) The net cash flows from investing activities increased by RMB2.8491805 billion yuan, a 257.00% year-on-year increase, which was resulted from the redemption of financial products upon maturity in the current period.

(3) Net cash flows from financing activities decreased by RMB 1.0746818 billion yuan, a 196.06% year-on-year decrease. It was

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mainly due to the repayment of the due short-term borrowings, and the payment of new-added rent expenses in the current year listed in “Payment of other cash related to financing activities” according to the the New Lease Standard .

Reason for significant differences between the net cash flow from operating activities and the net profit of the Company during the reporting period

□Applicable √Not applicable

Section V. Non-core business analysis

√Applicable □Not applicable

Unit: RMB yuan

	Amount	Proportion of Total Profit	Reason	Sustainable or not
Investment income	79,269,900.92	-2.86%	Mainly including income from financial products, and interest on time deposits	Yes
Gains and losses from changes in fair value	-21,490,322.52	0.78%	According to Financial Instruments Standards	Uncertain
Non-operating income	18,141,095.89	-0.66%	Formed during the operating process	Uncertain
Non-operating expenses	1,303,782.47	-0.05%	Formed during the operating process	Uncertain

Section VI. Analysis of assets and liabilities

1. Major changes in asset composition

Unit: RMB yuan

	End of Year 2021	End of Year 2021	Beginning of Year 2021	Beginning of Year 2021	Proportion of increase/ decrease	Major Changes
	Amount	Proportion of total assets	Amount	Proportion of total assets
Monetary fund	1,970,361,272.64	19.12%	5,950,395,089.12	41.27%	-22.15%	Mainly due to the decrease in the Company's business receipts and the increase in students’ tuition refunds
Accounts receivable	40,374,842.27	0.39%	21,493,637.66	0.15%	0.24%	Mainly due to the increase of rent receivables
Investment properties	644,936,541.46	6.26%	668,014,515.82	4.63%	1.63%	Mainly because the decline of total assets was greater than the decline of investment property

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Long-term equity investment	46,850,364.40	0.45%			0.45%	Mainly due to the increase from the transfer of Beijing Offcn Future Education Technology Co., Ltd. from a wholly-owned subsidiary to an associate company in the current period
Fixed assets	1,770,372,338.85	17.18%	1,612,792,592.67	11.19%	5.99%	Mainly due to the increase of houses and buildings resulted from the acquisition of Liu’an Yazhong Real Estate Information Consulting Co., Ltd. and Liu'an Zhongke Real Estate Information Consulting Co., Ltd. in the current period
Construction in progress	294,785,678.31	2.86%	214,248,125.04	1.49%	1.37%	Mainly due to the newly-added project of Rizhao Learning City in the current period
Right-of-use asset	1,342,280,387.08	13.03%	1,491,006,998.14	10.34%	2.69%	Mainly because the decline of total assets was greater than the decline of right-of-use assets
Short-term borrowings	3,152,945,812.59	30.60%	3,976,019,329.22	27.58%	3.02%	Mainly because the decline of total assets was greater than the decline of short-term borrowings
Contract liabilities	3,063,721,290.28	29.73%	4,925,428,309.33	34.16%	-4.43%	Mainly due to the decrease in the Company's business receipts and the increase in students’ tuition refunds
Lease liabilities	635,691,184.87	6.17%	632,866,068.34	4.39%	1.78%	No major changes

A high percentage of overseas assets

□Applicable √Not applicable

2. Assets and liabilities measured at fair value

√Applicable □Not applicable

Unit: RMB yuan

Item	Opening balance	Profits and losses from the changes in fair	Accumulate d changes in	Provisi on for impair	Amount of purchase in the current	Amount of sales in the current	Others	Closing balance

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		value in current period	fair value attributed to equity	period	period
Financial assets
1.Transaction al financial assets (excluding derivative financial assets)	1,191,656,173.26	-21,490,322.52		6,305,150,000.00	7,094,329,229.00	-4,000,000.00	376,986,621.74
4. Other equity investment	152,800,000.00		-22,400,000.00				130,400,000.00
Sub-total of financial assets	1,344,456,173.26	-21,490,322.52	-22,400,000.00	6,305,150,000.00	7,094,329,229.00	-4,000,000.00	507,386,621.74
Total	1,344,456,173.26	-21,490,322.52	-22,400,000.00	6,305,150,000.00	7,094,329,229.00	-4,000,000.00	507,386,621.74
Financial liabilities	0.00						0.00

Other changes

None

Whether the Company’s major assets measurement attributes have significant changes during the reporting period

□Yes √No

3. Assets with restricted rights as of the end of the reporting period

Unit: RMB

		Unit: RMB
Item	Book value at the end of the period	Reasons for restriction
Monetary funds	84,800.00	Security deposit
Monetary funds	470,463.08	dormant account/without reconciliation
Total	555,263.08

Section VII. Analysis of Investments

1. General situation

√Applicable □Not applicable

Investment amount in the reporting period (RMB)	Investment amount in the same period of the previous year (RMB)	Variation

	Offcn Education TechnologyCo.,Ltd. 2021 Annual Report	Offcn Education TechnologyCo.,Ltd. 2021 Annual Report	Offcn Education TechnologyCo.,Ltd. 2021 Annual Report

	7,079,571,718.12	43,223,486,027.58	-83.62%

2. Significant equity investment obtained during the reporting period

□Applicable √Not applicable

3. Significant non-equity investment ongoing during the reporting period

√Applicable □ Not applicable

Unit: RMB yuan

Project	Fushun Offcn Building	Rizhao Learning City	Changping Land Use Right	Total
Investment method	Self-built	Self-built	Self-built	--
Whether it is a fixed asset investment	Yes	Yes	Yes	--
Industries involved in investment projects	Educational technology development, service, cultural consulting	Educational technology development, service, cultural consulting	Educational technology development, service, cultural consulting	--
Amount of investment in this reporting period	16,812,207.39	63,725,345.88	2,494,150,000.00	2,574,687, 553.27
Accumulated investment as of the end of the reporting period	157,099,898.91	63,725,345.88	3,097,058,000.00	3,317,883, 244.79
Sources of funds	Self-owned funds	Self-owned funds	Self-owned funds	--
Project progress	47.61%	6.37%	0.00%	--
Estimated earning	0.00	0.00	0.00	0.00
Accumulated income as of the end of the reporting period	0.00	0.00	0.00	0.00
Reasons for not meeting the planned progress and expected income	Not completed yet	Not completed yet	Transferred	--

4. Financial assets investment

（ 1 ） Securities investment

√Applicable □Not applicable

Unit: RMB yuan

Securi ties	Securiti es code	Securiti es abbrevi ation	Origina l invest ment	Accou nting measur ement	Book value at the beginni	Profits and losses from	Accum ulated change s in fair	Purcha se amount for this	Selling amount for this period	Profits and losses during	Book value at the end of	Accou nting subject s	Source s of fund

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----- Start of picture text -----

cost model ng of change value period the the
the s in fair include reporti period
period value d in ng
for the equity period
current
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Stable-prof
it Hybrid Transacti
Fair value
Securities 9,999,00 10,467,9 -468,953 9,999,00 735,926. onal Self-owne
Funds 010439 measurem 0.00 0.00 0.00
Fund with 0.00 53.10 .10 0.00 30 financial d funds
ent
one-year assets
holding
period
9,999,00 10,467,9 -468,953 9,999,00 735,926.
Total -- 0.00 0.00 0.00 -- --
0.00 53.10 .10 0.00 30
Disclosure date of the
announcement of securities
N/A
investment approval by board
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Disclosure date of the
announcement of the securities
N/A
investment approval by board
of shareholders (if any)
----- End of picture text -----

(2) Derivatives investment

□ Applicable √ Not Applicable

There is no derivatives investment during the reporting period of the Company.

5. Use of raised funds

□ Applicable √ Not Applicable

There is no use of raised funds during the reporting period of the Company.

Section VIII. Sale of major assets and equity

1. Sale of major assets

□Applicable √Not applicable

The Company did not sell any major assets during the reporting period.

2. Sale of major equity

√Applicable □Not applicable

Counterparty Beijing Shangheng Jirui Commercial Operation and Management Co., Ltd.

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The amount of sold equity	51% equity of the Company’s wholly-owned subsidiary — Beijing Offcn Future Education Technology Co., Ltd.
Sale date	October 12, 2021
Transaction value (RMB 10 thousand yuan)	5,100
Net profit contributed by the equity to the Company from the beginning of the current period to the sale date (RMB 10 thousand yuan)	-5.08
Influence of the sale on the Company	The Company works with the subsidiary of the powerful Longfor Group to develop the target company ’ s project by transferring the controlling interest of its wholly-owned subsidiary. The Longfor side develops the residential land, while the Company channels funds and efforts into the construction of public projects which is connected with the main business. The cooperation prompts the establishment of the Company's online technology R&D center, OMO education demonstration center, R&D and teaching personnel integrated training center, national market vertical integrated response command center and innovation education headquarters, which will effectively improve the Company’s capacities of cluster R&D, mass production and popularization of OMO products, vertical integrated fast response in national market, and agile innovation of all categories of products. Besides, the Company plans to create a one-stop base for food, housing and learning which can accommodate more than 5,000 students and provide them with OMO training, and where can hold multiple rounds of intensive internal training in R&D and teaching for over 30,000 teaching and R&D personnel. Upon completion, this new center, which fully integrates with online technology, will systematically enhance the Company's training capabilities for internal staff and students, accelerate the thorough innovation and upgrade of technology, R&D, training, service, market and command system in the industry, and strongly enhance the Company’s brand image and establish competitive barrier, which are all in line with the Company's long-term development strategy and the interests of all shareholders.
Proportion of net profit contributed by the sale to the Company in the total net profit	0
Pricing principle of the equity sale	Negotiation based on paid-in registered capital
Whether it is a related party transaction	No
Relationship with the counterparty	N/A
Whether the equity involved has been fully transferred	Yes
Whether it is implemented on schedule or not. If not, the reasons and the measures the Company has taken should be stated.	Implemented on schedule

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Disclosure date	September 27, 2021
Disclosure index	For details, please refer to the Announcement on the Transfer of Part of the Wholly-owned Subsidiary’s Equity and Cooperative Development (No. 2021-061) disclosed by the Company on www.cninfo.com.cn.

Section IX. Analysis of major holding and participating companies

√ Applicable □Not Applicable

Major subsidiaries and shareholding companies that affect the Company's net profit by more than 10%

Unit: RMB yuan

	Unit: RMB yuan
Company name	Beijing Offcn Education Technology Co., Ltd
Company type	Subsidiary
Major business	Educational technology consulting, technology development, technical services, technology promotion, technology transfer; educational consulting; cultural consulting; corporate management consulting; corporate investment consulting;computer technology training (not for national admissions); public relations services; hosting exhibition activities; organizing cultural and artistic exchange activities (excluding performances); conference services;design, production, agency, release of advertisements; publication wholesale; publication retail; operating telecommunications business; human resource services; radio and television program production; engaging in Internet cultural activities.(Market entities independently choose operating projects and carry out operating activities in accordance with the law; engage in Internet cultural activities, publication wholesale, publication retail, telecommunications business, radio and television program production, human resource services, and projects subject to approval in accordance with the law, and after approval by relevant departments, carry out operating activities in accordance with the approved content; shall not engage in operating activities that are prohibited or restricted by the state and this city’s industrial policies.)
Registered capital	90,000,000.00
Total assets	8,011,989,972.20
Net assets	955,658,207.14
Revenue	6,885,584,429.07
Operating profit	-2,691,880,548.00
Net profit	-2,254,851,259.12

Acquisition and disposal of subsidiaries during the reporting period

√ Applicable □ Not Applicable

Company name	Method of acquisition and disposal of subsidiaries during the reporting period	Impact on the overall business operations and performance
1. Lu’an Yazhong Real Estate Information Consulting Co., Ltd.	Acquisition	No major impact
2. Lu’an Zhongke Real Estate Information Consulting Co., Ltd.	Acquisition	No major impact

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Offcn Education Technology Co., Ltd. 2021 Annual Report

3. Wenling Offcn Information Consulting Co., Ltd.	New establishment	No major impact
4. Anshan Tiedong Offcn Education Training School Co., Ltd.	New establishment	No major impact
5. Diqing Offcn Training School Co., Ltd.	New establishment	No major impact
6. Dali Offcn Education Training School Co., Ltd.	New establishment	No major impact
7. Harbin Nangang Offcn Education Training School Co., Ltd.	New establishment	No major impact
8. Nujiang Offcn Training School Co., Ltd.	New establishment	No major impact
9. Weixi Offcn Education Training School Co., Ltd.	New establishment	No major impact
10. Beijing Offcn Century Education Technology Co., Ltd.	New establishment	No major impact
11. Beijing Offcn Future Education Technology Co., Ltd.	Transferred	No major impact

Major holding and participating companies

In 2021, the Company ’s wholly-owned subsidiary, Beijing Offcn Education Technology Co., Ltd., achieved a revenue of RMB 6.8855844 billion yuan, a decrease of 38.43% from the previous year, and a net profit of RMB -2.2548513 billion yuan for the year, a decrease of 196.39% from the previous year.

Section X. Structured entities controlled by the Company

□ Applicable √ Not Applicable

Section XI. Forecast of the Company’s future development

1. Trends of the industry’s future development

(1) The status of vocational education in education system is enhancing.

For a long time, China’s education system has been dominated by curricula education and the foundation of vocational education is relatively weak. There is a serious shortage of high-end skilled talents supply and in the future, the need for more “skilled craftsmen” and “great builders” will remain urgent.

In recent years, China’s industrial structure is undergoing transformation and upgrading. The government has clearly proposed that great efforts will be made to promote the development of emerging industries with strategic importance, and the proportion of modern service industry will be further increased. With rapid changes in the industrial structure, the requirements from enterprises for the professional competence and comprehensive quality of technical personnel have gradually increased. New requirements for their practical ability have also been put forward. Traditional academic education can’t fully meet the new requirements.

Besides, the government continues to enhance the efforts to develop vocational education. In addition to the pertinent documents, such as Decision of the State Council on Making Great Efforts to Develop Vocational Education published in 2005, and National Plan for Vocational Education Reform and China ’s Education Modernization Plan 2035 published in 2019, the 2021 National Vocational Education Conference further emphasized that vocational education has a bright future and promising prospects in the new journey of building a modern socialist country in all respects, and put forward explicit requests for accelerating the construction of a modern vocational education system, and cultivating more high-caliber technical and skilled professionals, thus

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promoting the status of vocational education in the whole education system from both the policy and institutional levels.

(2) The continuous increase in the number of college graduates is an important indicator of the employment situation.

Usually, a faster growing economy will bring a higher level of employment. In recent years, economic growth has slowed down, but the number of university graduates has continued to grow. It will reach 10.76 million this year, setting a new historical record.

College graduates account for more than half of the annual demand of over 15 million new jobs, and the bonus period for the export of cheap rural labor has come to an end. The expansion of university enrollment has obviously and directly accelerated the arrival of the turning point. The labor shortage of farmer laborers coexists with the difficult employment of college graduates. The demand for training for public service recruitment examination continues to rise.

In addition, aiming to maintain sustained economic growth, realize transformation and upgrading, and overcome the “ middle-income trap ” , it is urgently necessary to carry out industrial upgrading for middle and high-end vocational education in order to improve the vocational skills and professional literacy of knowledge-based employees.

(3) The serious shortage of high-quality supply is the main contradiction that restricts the development of the vocational education industry.

At present, the foundation of vocational education is still weak. Due to the extremely low concentration of the industry and the limited number of large vocational education institutes and enterprises, the supply of high-quality vocational education is seriously insufficient. With the improvement of industry concentration and the continuous development of leading vocational education enterprises, core business elements such as R&D, management and marketing of vocational education will gradually break through the original boundaries of the industry, create high-quality and cost-effective supplies, drive demand-side volume with supply-side innovation and push the industry into a new track of rapid development.

(4) The urbanization wave will promote the continuous improvement of public service and the number of employees of the public service sector will continue to expand.

The process of urbanization is a key driver of the long-term impact on China’s employment market growth. At present, the urbanization rate has exceeded 60%. Urbanization will expand the public financial expenditure and the number of employees in the public service sector. China’s urbanization rate remains in a high-speed growth range of 30% to 70%. It is likely to continue to develop for nearly 20 years to achieve an urbanization rate of more than 80% in developed countries. Meanwhile, continuous urbanization may also lead to more seriously inadequate public service supply in cities, which will also impose higher requirements on the quality of public services.

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Compared with public products such as infrastructure, public services are labor-intensive inputs, especially the basic public services of local governments. A large number of employees can be hired while public service capabilities are being improved. China ’s long-term goal for 2035 and the main goal of economic and social development during the “14th Five-Year Plan” period require a significant increase in the level of equalization of public services. According to the research by the National Academy of Governance, the employed population in the public sector in developed countries accounts for about 10% to 20% of the workforce, which is even higher than 20% in Canada and Hong Kong. However, the employed population in the current public sector only accounts for 5% in China.

With the deepening of urbanization, the proportion of employed population in China ’s public sector will gradually increase; and the market of training for public service recruitment examination will also maintain a long-term steady growth, which has been partially proved by the astonishing demands on the training for teacher recruitment examination and recruitment examination in medical treatment and public health.

2. Strategic development direction of the Company

(1) Cement the leadership position in recruitment training market and take steady development as the first priority

At present, the industry is facing major challenges due to the influence of pandemic and policies, but this does not change our view on long-term trends. Urbanization, equalization of public services, the natural renewal of the in-service staff in large scale and the stabilization of employment are the main trends of the economic and social development, which means that the long-tail effect of the recruitment market will continue to strengthen. Under the new industry context, the Company will innovate and optimize the products proactively, respond to the demand of new-added employment more quickly and meet the demand more properly, transfer from the pursuit of high growth to sustainable and sound development, balance business development and profitability and cement the leadership position in recruitment training market

(2)Maintain effective R&D investment and strengthen the advantages of the leading vocational education innovation platform.

R&D shall always be regarded as the fundamental driving force for all undertakings. The Company will resolutely carry out long-term and heavy investment in R&D and attract outstanding talents to participate in R&D. With R&D, the Company will drive innovation from the bottom level, make systematic improvement, break through industry boundaries, and establish competition barriers, so as to perfect its current major businesses, expand its new businesses, and remain to be a leading vocational education innovation platform.

(3)Further integration of technology and business for digital transformation of operations

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Years of accumulation of independent IT development is the Company ’ s valuable wealth, enabling the Company to calmly cope with the new opportunities and challenges brought by the development of science and technology. The Company will constantly increase investment in technology infrastructure and technical teams and enhance responsiveness of technology through technological middle platform and agile development to expand development output. On this basis, the Company will continue to accelerate digital transformation of operations and fully integrate the productivity of technology with operation system to facilitate business innovation, and improve the level of intelligence in operation and teaching, thus supporting vertical integrated fast response capability with a wider range and on a larger scale.

(4) Cut out redundant categories and focus on core markets

The Change of the economic environment brought about by the pandemic has made the industry get real-life insights, and treading in the deep water has given the Company a more objective understanding about itself. In 2022, the Company will conform to social consumption trends, streamline and refine businesses, cut out redundant categories, focus on core categories including training for post-graduate entrance examination, IT and vocational skill, improve standards of service quality, and take advantage of intelligent information system to develop products that meet market demand.

(5) Optimize channels proactively and strengthen the core sectors

After years of business expansion, the Company has established more than 1,500 outlets and learning centers and the channel networks have covered more than 300 cities across the country. Next, the Company will analyze national market demand thoroughly and optimize the channel networks properly according to the business development strategy. The Company will channel superior resources into strengthening the core sectors on the premise that the stability of the business network main body is ensured.

3. Major business plan of the Company for 2022

(1) Rectify and reform proactively and seek the optimum balance between products, staff and channels

In the past three years, the volume of the Company has expanded quickly by taking the rapid-expansion strategy, which has caused more difficulty for management, increased the operation cost of the Company objectively and put more pressure on maintaining and increasing the whole profit margin. In 2022, under these unfavorable operating conditions, the Company will rectify and reform proactively. It will control the number of the staff in a reasonable scale and concentrate efforts on optimizing performance incentive policies. It will take effective measures to adjust and optimize the structure and channels of products in accordance with the changes of

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users’ demand and market and focus on the management and control of cost. By seeking the optimum balance between products, staff and channels, the Company may reverse the decline trend of performance and promote its steady and sound development.

(2) Optimize the product structure and underline quality and profitability

The Company has been regarding steady and sound operation as the bottom line. Due to the intensified market competition, to stabilize the market share, and to facilitate the new channels and outlets expanding their local markets, the Company’s product structure became unbalanced. This year, the Company will optimize the product structure timely, lower the proportion of the high-tuition-refund agreement courses, refine the product quality and innovate the service model according to the demand of market and trainees to improve the operating profitability and performance in the post-pandemic era.

(3) Continue to further the Online-Merge-Offline business

In 2022, the Company will increase investment in online business and OMO business. Based on years of digital penetration of the main course products, the Company will further expand the leading advantages of OMO courses, so that more trainees can obtain the convenience of online learning and the effectiveness of face-to-face learning at the same time, thus rapidly increasing the number of learners and the rate of participation.

(4) Implement Amoeba management to streamline production mechanism and stimulate impetus for cost decreasing and benefit increasing from bottom to top

In 2022, the Company will deepen the management reform and implement Amoeba management thoroughly to streamline production mechanism. Based on value creation and profit assessment, the Company will carry out delicacy operation in every project and sub-center, optimize the human resources structure and improve vertical integrated fast response capabilities to meet the new development requirements for the implementation of the Company’s strategy.

(5) Steadily explore new businesses and expand the scale of vocational skills training business

In 2022, the Company will continue to explore new business of vocational education and establish vocational education department. Apart from integrating internal resources, the Company will cooperate with government, enterprises and colleges to carry out explorations in AI, digital economy, convergence media, cultural and creative industries characterized by digitization, intelligent manufacturing, intelligent aviation and other industries and tap the full potential of the existing resources to find new growth points. At the same time, the Company launches a

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career promotion platform for extensive professions to provide training services for part-time jobs, advancement of vocational skill and certificate exams by new training models such as “Internet +” and “Intelligence +” to meet the training demand of the high-quality professional skilled personnel in the context of new technologies, new industries, new business forms and new models and improve the employment and entrepreneurial ability of college students and young talents, enhance the re-employment capability of ordinary laborers after post transfer, and popularize the general vocational qualities and digital skills. By the thorough implementation of professional skill improvement measures, the Company can seize the opportunity when flexible employment is supported by the government and the demand for skills training soars.

4. Possible Risks

(1)Industry Policy Risks

The boom of the vocational education industry has a high correlation with the policy environment, and is easily influenced by the vocational education policy. In recent years, in order to support the development of the vocational education industry, the state has successively issued a number of industry support and encouragement policies. However, it will take time for the corresponding supporting laws, regulations and rules to be fully implemented, and there is still a certain degree of uncertainty in the future. If there are major changes and adjustments to relevant laws, regulations or industrial policies in the future, it may have an impact on the development trend of the vocational education industry, which may affect the Company ’ s future business development and performance. In addition, the Company has many branches and wide distribution of training venues. It is not ruled out that in the future, relevant regulatory authorities of provinces, autonomous regions and municipalities will issue more stringent regulations for the local education and training industry, which may affect the Company’s operations in the region.

Risk response: Each branch of the Company has established a tracking research policy team to conduct in-depth analysis of various policies that have been issued. At the same time, the Company’s deep IT independent development and accumulated strength and effective digital transformation of operations simultaneously ensure the efficiency of information feedback. Through the upgrading and transforming of basic systems such as ERP, CRM, and teaching platforms, it is possible to obtain, perceive and predict the direction and trend of relevant policy changes in various places in a timely manner, make arrangements and adjustments in advance, avoid relevant policy risks, and take advantage of industry policies to help the Company’s business development.

(2) Market Risks

With the policy support from the government, the industry of vocational education is expected to continue to keep prosperous, which will result in more capital inflow into the industry and ever more intense market competition. At the same time, the continuous recurrence of the Covid-19 has put our country ’ s economic

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development under the triple pressures of shrinking demand, supply shock and weakening expectations. Although the promotion of taking vaccines of Covid-19 in all parts of the country has laid a foundation for economic recovery, consumer confidence has dropped significantly compared with that in the pre-pandemic period, their willingness to spend is low and the demand for training has shrunk dramatically. Therefore, in the long run, the market demand will still be on a growing trend, but it cannot be ruled out that in the short term, it will decline due to various factors, which will affect the students’ enthusiasm to take part in exams and lead to a decline in market demand.

Risk response: In response to the above risks, the Company will continue to maintain effective investment in research and development, and also in technology infrastructure and technical teams to integrate the productivity of technology into the business system and promote business innovation and the quality of products and services. The Company will optimize the product structure timely, refine the product quality and innovate the service model according to the demand of market and trainees, to improve the operating profitability. At the same time, based on the operating conditions, the Company will seek the optimum balance between products, staff and channels and strengthen the control over cost to enhance the Company’s capability of fighting against market risks.

(3)Management Risks

With the continuous expansion of the Company’s business categories and branches, the Company must face the risk of mismatch between expansion and management capabilities. Costs such as venue leasing and labor have continued to increase, and the pursuit of rapid development has led to a decline in the current profit level and profit margin. At the same time, there are recurrences of the pandemic in some parts of the country, which result in that offline training cannot be carried out smoothly in some areas. In addition, influenced by the pandemic, the recruitment exams of public service in some areas were put off or canceled, contributing to the decline of training demand. If the pandemic worsens or spreads further in the future, it may have a material adverse impact on the Company’s operating performance.

Risk response: In view of the above risks, the Company will continue to optimize its management system of vertical integrated fast response, enhance the coordination between large-scale knowledge employees, improve management and operation efficiency, upgrade human resources structure, and conform to the Company’s business expansion strategy. The Company attaches importance to talent reserves, makes arrangements in advance, and promotes the realization of growth expectations for new categories. The Company will continue to invest in online business and OMO business and promote the integration of offline and online business to alleviate the shock of the pandemic.

Section XII. Reception of research, communication, interview and other activities

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√ Applicable □ Not Applicable

Date	Place	Ways of reception	Type of reception object	Reception object	Discussion content and the materials provided	Index of the survey
Jul. 16, 2021	-	Telephone	Others	173 people from 88 public offering institutions, private placement agencies and investors, such as Bank of Communications Schroeder, E Fund, Invesco Great Wall, Fullgoal Fund, Perseverance Asset Management, AEGON-Industrial Fund, Bank of China Investment Management, Southern Asset Management, Bosera Funds, AIA, Harvest Fund, Dacheng Fund, Manulife TEDA, Penghua Fund, Western Leadbank, HSBC Jintrust, ABC-CA Fund, BlackRock, Fidelity, Infore Capital Management, and Barings.	Interpretation of the Company's semi-annual performance in 2020 and introduction of the business development	Record form of investor relations activity disclosed by the Company on www.cninfo.com .cn on Jul. 16, 2021

Chapter 4 Corporate Governance

Section I. Basic Information of Corporate Governance

During the reporting period, in strict accordance with relevant laws and regulations, and rules and regulatory documents from supervision authorities, i.e. Company Law , Securities Law , Code of Corporate Governance for Listed Companies in China , Stock Listing Rules of Shenzhen Stock Exchange , and Listed Companies Self-Regulatory Guidelines No.1 — Standardized Operation of the Listed Companies on Main Board , the Company, based on its actual situation, consistently improved its corporate governance structure and internal control system, and enhanced the level of corporate governance. The Company ’ s overall operation, corporate governance system and information disclosure were sound and standardized. The actual conditions of corporate

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governance met the requirements of the regulatory documents with respect to the corporate governance of listed companies issued by CSRC.

1. Shareholders and the Shareholders’ General Meeting

In strict accordance with Articles of Corporation and Rules of Procedure for Shareholders’ General Meeting as well as other applicable regulations and requirements, the Company standardized the gathering, convening, deliberations and voting procedures of its shareholders’ general meetings and hired legal advisers to issue legal opinions for the shareholders ’ general meetings. The Company treats all shareholders equally and especially ensures that the minority shareholders enjoy equal status. During the reporting period, the Company convened two shareholders’ general meetings in total, and all resolutions of the shareholders’ general meetings were faithfully implemented by the board of directors.

2. The relationship between the Company and the controlling shareholders

The controlling shareholders of the Company exercised the rights and obligations of the investors in strict accordance with Company Law . During the reporting period, there was neither any direct or indirect interference with the Company’s decision-making and operations beyond the Shareholders’ General Meeting by the controlling shareholders nor a situation where the controlling shareholders damaged the legitimate rights and interests of other shareholders of the Company. There wasn ’t any guarantee provided by the listed Company for the controlling shareholders or their subsidiaries.

3. Directors and the Board of Directors

The Company elected candidates for the Board of Directors in strict accordance with relevant laws and regulations i.e. Company Law and Articles of Corporation . The number of directors and composition of the Board of Directors met the requirements of laws and regulations. The Board of Directors of the Company convened Board sessions in strict accordance with the relevant provisions of Articles of Corporation , Regulations of Appointment and Proceedings for Independent Directors and Rules of Procedure for the Board of Directors . All directors of the Company attended the Board sessions on time, fulfilled their duties diligently, scrupulously reviewed various proposals and made scientific and reasonable decisions on major matters of the Company to effectively safeguard the interests of the Company and the legitimate rights and interests of all shareholders. Under the Board of Directors of the Company are four professional committees: Strategy and Investment Committee, Nomination Committee, Audit Committee and Remuneration and Appraisal Committee. With clearly defined powers and responsibilities and effective operations, each committee gave full play to its professional functions and provided scientific and professional opinions for the decision-making of the Board of Directors.

4. Supervisors and the Supervisory Committee

The Company elected candidates for the Supervisory Committee in strict accordance with relevant laws and regulations i.e. Company Law and Articles of Corporation . The number of supervisors and composition of the Supervisory Committee met the requirements of laws and regulations. The Supervisory Committee of the Company convened its sessions in strict accordance with the relevant provisions of Articles of Corporation , Rules of Procedure for the Supervisory Committee , and other related regulations. All supervisors of the Company attended

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the supervisory sessions on time, fulfilled their duties faithfully, provided supervision and opinions for major issues, financial status, etc., and safeguarded the legitimate rights and interests of the Company and shareholders.

5. Relevant stakeholders

The Company fully respects and safeguards the legitimate rights and interests of relevant stakeholders, constantly strengthens the awareness of social responsibility and enhances communication with all parties to coordinate and balance the interests of the society, government, shareholders, the Company itself, and its employees. The Company adheres to the principle of mutual benefits and win-win results with relevant stakeholders and jointly promotes the Company’s harmonious, steady and sound development.

6. Information disclosure and transparency

In strict accordance with the requirements of Regulations Concerning Information Disclosure Management, Regulations Concerning Investors Relations Management and Regulations of Registration and Management System on Learners of Insider Information , the Company designates the Secretary of the Board to be responsible for information disclosure, receiving shareholders’ visits and consultations and to disclose the relevant information in an authentic, accurate, complete, timely and fair manner in accordance with relevant regulations so as to ensure that all shareholders of the Company can have equal access to the information.

7. Performance appraisal and incentives

During the reporting period, the Company constantly improved working performance evaluation system and incentive mechanism. The appointment and remuneration of the Company ’ s directors, supervisors and senior executives were open and transparent, which met the requirements of relevant laws and regulations. The Company regularly and comprehensively evaluated employees ’ working skills, values and their recognition of corporate culture by an evaluation method based on quantitative indicators of performance and qualitative standards to ensure that both the work results and growth of employees were given attention to.

8. Investor relations management

During the reporting period, the Company constantly strengthened the management of investor relations and safeguarded the legitimate rights and interests of the Company ’ s shareholders. The Company designates the Secretary of the Board as the head of investor relations management to organize and implement the daily management of investor relations, and promptly answer investors ’ questions through phone calls, emails, interactive platform and online briefings of business performance, which ensures that all the investors have equal access to the Company’s information and fully guarantees investors’ rights to know.

Are there any material differences between the Company ’ s actual governance status and the laws, administrative regulations and rules on the governance of listed companies issued by CSRC?

□ Yes √ No

There is no material difference between the Company’s actual governance status and the laws, administrative regulations and rules on the governance of listed companies issued by CSRC.

Section II. Details of the Company’s separation from its controlling shareholders and actual

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controllers to ensure the Company’s independence on assets, personnel, finance, organization and business affairs

The Company standardized its operation, established and improved corporate governance structure in strict accordance with Company Law , Securities Law , Articles of Corporation , and other relevant laws and regulations. The Company is independent in business, personnel, assets, organization and finance affairs from the controlling shareholders, actual controllers and other enterprises under their control, and is capable of operating independently with its complete and independent business.

Business independence: With independent and complete business structure, the Company is capable of running market-oriented business independently. There is no horizontal competition among the Company, controlling shareholders, and other enterprises under their control.
Personnel independence: The Company has independent personnel. It has set up various independent departments, including R&D, sales, administration, finance and operation management divisions, and established independent human resources and payroll management system. The directors, supervisors and senior executives of the Company do not hold any posts prohibited by regulations in other companies with the same or similar business to the Company’s.
Assets Completeness: The property relations between the Company and the controlling shareholders are clear. No assets, funds, or other resources owned by the Company are illegally occupied or controlled by the controlling shareholders.
Institutional independence: The Company has set up a sound organization system. General Meeting of Shareholders, Board of Directors, Supervisory Committee, management and all the functional departments operate independently from each other. The Company as well established corresponding internal management and control system to make each department have clearly defined responsibilities, perform its own duties and cooperate with each other, thus composing an organic whole and guaranteeing the legal operation of the Company. There is no subordinate relationship between the Company ’ s institutions and the functional departments of the controlling shareholders.
Financial independence: The Company has set up complete and independent financial department equipped with adequate full-time financial accountants, established independent accounting calculation system and financial management system, and independently opened bank accounts, paid taxes and made financial decisions. There is no interference from the controlling shareholders in the financial management of the Company.

Section III. Horizontal Competition

□Applicable √Not applicable

Section IV. Annual general meeting and extraordinary general meetings convened during the reporting period

1. Particulars about the shareholders’ general meeting during the reporting period

Session	Type	Investor Participation %	Convening date	Disclosure date	Resolution

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2021 First Extraordinary General Meeting	Extraordinary General Meeting	78.68%	January 25, 2021	January 26, 2021	For details, refer to the Announcement on Resolutions of the First Extraordinary General Meeting of 2021 (No. 2021-004) disclosed on www.cninfo.com.cn.
2020 Annual General Meeting	Annual General Meeting	80.10%	June 15, 2021	June 16, 2021	For details, refer to the_Announcement on_ Resolutions of the Annual General Meeting of 2020(No. 2021-044) disclosed on www.cninfo.com.cn.

2. Extraordinary general meetings requested by preferred shareholders with restored voting rights:

□Applicable √Not applicable

Section V. Directors, supervisors and senior executives of the Company

1. Basic information

Name	Title	Tenure status	Gender	Age	Start date	End date	Shares held at the beginning of the period (share)	Quantity of shares decreased in the current period (share)	Quantity of shares held at the end of the period (share)	Reasons for increase or decrease of shares
Li Yongxin	Chairman of the Board	Incumbent	Male	46	February 1, 2019	January 27, 2025	1,131,41 5,121		1,131,41 5,121
Wang Zhendong	Director, general manager	Incumbent	Male	46	February 1, 2019	January 27, 2025	962,471, 418	109,586, 000	852,885, 418	Reduce shareholdi ng
Shi Lei	Director	Incumbent	Male	46	February 1, 2019	January 27, 2025
Yi Ziting	Director	Incumbent	Female	48	February 1, 2019	January 27, 2025
Wang Qiang	Independe nt director	Incumbent	Male	45	February 1, 2019	January 28, 2022
Tong Yan	Independe nt director	Incumbent	Female	45	February 1, 2019	January 28, 2022
Zhang Xuanming	Independe nt director	Incumbent	Male	44	February 1, 2019	January 27, 2025
Yu Hongwei	Chairman of the	Incumbent	Female	56	July 22, 2019	January 27, 2025

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	Supervisor y Committee
He Di	Supervisor	Incumbent	Male	45	February 1, 2019	January 27, 2025
Li Wen	Supervisor	Incumbent	Female	43	February 1, 2019	January 27, 2025
Wang Xuejun	Deputy general manager	Incumbent	Male	59	February 1, 2019	January 28, 2022
He Youli	Deputy general manager	Incumbent	Male	47	February 1, 2019	January 27, 2025
Luo Xue	Chief Financial Officer	Incumbent	Male	54	February 1, 2019	January 27, 2025
Gui Hongzhi	Secretary of the Board, deputy general manager	Incumbent	Male	51	February 1, 2019	January 27, 2025
Total	--	--	--	--	--	--	2,093,88 6,539	0	109,586, 000	0	1,984,30 0,539	--

During the reporting period, is there any resignation of directors and supervisors or dismissal of senior executives during their term of office?

□Yes √ No

Changes of directors, supervisors, and senior executives

□Applicable √Not applicable

2. Resumes of key personnel

The professional background, main working experience and their main duties in the Company of current directors, supervisors, and senior executives.

(1)Directors and independent directors

Mr. Li Yongxin , born in 1976, is a Chinese citizen and has no permanent residency abroad. He received his bachelor’s degree in law from the Department of Political Science and Public Administration, Peking University in 1999. Mr. Li founded his own company in education industry in the same year and started to focus his business on training for public service recruitment examination in the year of 2000. Up to now, he has accumulated nearly 20 years of experience in R&D, teaching and business management in the field of training for public service

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recruitment. From 2005 to 2010, he served as the general manager of Beijing Offcn Online Education Technology Co., Ltd. From 2010 to November 2015, he was the president of Beijing Offcn Future Education Consultancy Co., Ltd. From November 2015 to December 2018, he served as the Chairman of Board of Beijing Offcn Education Technology Stock Co., Ltd. From December 2018 to present, he has served as the Chairman of Board of Beijing Offcn Education Technology Co., Ltd. From February 2019 to present, he has served as the Chairman of Board of Offcn Education Technology Stock Co., Ltd.

Mr. Wang Zhendong , born in 1976, is a Chinese citizen and has no permanent residency abroad. He received his bachelor’s degree in law from the Department of Political Science and Public Administration, Peking University in 1999. In the year of 2001, Mr. Wang Zhendong started his career in education industry. From 2005 to 2010, he was in charge of the internal operation and management of Beijing Offcn Online Education Technology Co., Ltd. From 2010 to November 2015, he served as the executive director and general manager of Beijing Offcn Future Education Consultancy Co., Ltd. From November 2015 to December 2018, he was the director and general manager of Beijing Offcn Education Technology Stock Co., Ltd. From December 2018 to present, he has served as the director and general manager of Beijing Offcn Education Technology Co., Ltd. From February 2019 to present, he has served as the director and general manager of Offcn Education Technology Stock Co., Ltd.

Mr. Shi Lei , born in 1976, is a Chinese citizen and has no permanent residency abroad. He started his career in education industry in the year of 1999. From 2005 to 2010, he was in charge of marketing operations and management of Beijing Offcn Online Education Technology Co., Ltd. From 2010 to November 2015, he was the vice president of Beijing Offcn Future Education Consultancy Co., Ltd. From November 2015 to December 2018, he served as a director, the Chief Financial Officer and secretary of the Board of Beijing Offcn Education Technology Stock Co., Ltd. From December 2018 to present, he has served as a director of Beijing Offcn Education Technology Co., Ltd. From February 2019 to present, he has served as a director of Offcn Education Technology Stock Co., Ltd.

Ms. Yi Ziting , born in 1974, is a Chinese citizen and has no permanent residency abroad. She has a master’s degree. Ms. Yi Ziting switched her career path to education industry in the year of 2011. From 1994 to 2004, she served successively as a technician and an assistant engineer in Zhuzhou Smelting Group Co., Ltd. From 2007 to 2011, she was the head of legal department of China Crop Protection Industry Association (CCPIA). Starting from 2011, Ms. Yi Ziting has been successively holding the posts of head of Teaching Evaluation and Management Committee, assistant president, and associate president of Beijing Offcn Future Education Consultancy Co., Ltd. From November 2015 to December 2018, she served as a director of Beijing Offcn Education Technology Stock

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Co., Ltd. From December 2018 to present, she has served as the chairman of the Supervisory Committee of Beijing Offcn Education Technology Co., Ltd. From February 2019 to present, she has served as a director of Offcn Education Technology Stock Co., Ltd.

Ms. Chen Yuqin, born in 1965, is a Chinese citizen and has no permanent residency abroad. She is a senior economist and a member of CPC. She got a bachelor’s degree in economics from Renmin University of China as a full-time student and was an on-the-job graduate student in Tsinghua University. From August 1987 to March 1992, she worked as a teacher in Tsinghua University. From April 1992 to August 2005, she worked in a state-owned bank, and served successively as the deputy department manager of the sub-branch (in charge of work), the department manager (credit approver and the office director of the Risk Management and Internal Control Committee), the sub-branch manager (and the Party branch secretary). From August 2005 to December 2020, She worked in the joint-stock bank, and served successively as a full-time approver in the branch, assistant manager of the sub-branch (in charge of work), manager of the sub-branch (and the Party branch secretary) and etc. She retired at the end of December 2020. From August 4, 2021 to present, she has been working as a non-independent director of Hengxin Shambala Culture Co., Ltd. From January 2022 to present, she has been serving as an independent director of Offcn Education Technology Stock Co., Ltd.

Mr. Jiang Tao, born in 1974, is a Chinese citizen and has no permanent residency abroad, a postdoctor in economics from Sichuan University. He is currently an associate professor of Southwestern University of Finance and Economics, deputy director of the Finance Department of Accounting Institute, and financial consultant for Sichuan Trade Petroleum Energy Co., Ltd. and Doppler Elevator Co., Ltd. From September 2020 to present, he has been serving as an independent director of Chengdu Xinzhu Road & Bridge Machinery Co., Ltd. From January 2022 to present, he has been serving as an independent director of Offcn Education Technology Stock Co., Ltd.

Mr. Zhang Xuanming , born in 1978, is a Chinese citizen and has no permanent residency abroad. He has a master ’s degree and is qualified as a Chinese lawyer. From 2003 to 2005, he worked as a full-time lawyer in Beijing Weizheng Law Firm. From 2005 to 2010, he was a partner of Beijing Hechuan Law Firm. From April 2017 to present, he has served as the director of Beijing Meixin Law Firm. From July 2013 to present, he has served as a supervisor of Tongling Friendship Real Estate Co., Ltd. From October 2015 to present, he has served as a supervisor of Hebei Xinmiao Tourism Development Co., Ltd. From February 2019 to present, he has served as an independent director of Offcn Education Technology Stock Co., Ltd.

(2)Supervisors

Ms. Yu Hongwei , born in 1966, is a Chinese citizen and has no permanent residency abroad. She has a

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bachelor’s degree. From 1985 to 1995, Ms. Yu Hongwei served as a Naval Officer. From 1995 to 2002, she was the chief representative of GATX Beijing Office. From 2002 to 2008, she served as the administrative director of the Zhuoyue College in the University of International Business and Economics. From 2008 to 2013, she worked for the Chinese Academy of Science as the director of Senior Talents Department in the Personnel Exchange and Development Center, then as the deputy Party secretary, and chairman of Trade Union. From 2013 to October 2015, Ms. Yu Hongwei served as a department director of Beijing Offcn Future Education Consultancy Co., Ltd. From November 2015 to December 2018, she successively held the posts of department director, the secretary of Party Branch and the secretary of Party Committee of Beijing Offcn Education Technology Stock Co.,Ltd. From December 2018 to present, she has served as the secretary of Party Committee of Beijing Offcn Education Technology Co., Ltd. From July 2019 to present, she has served as the Chairman of the Supervisory Committee of Offcn Education Technology Stock Co., Ltd.

Mr. He Di , born in 1977, is a Chinese citizen and has no permanent residency abroad. He received a bachelor’s degree. From 2010, he served as an assistant president of Beijing Offcn Future Education Consultancy Co., Ltd. From November 2015 to December 2018, he worked as a supervisor of Beijing Offcn Education Technology Stock Co.,Ltd. From December 2018 to present, he has served as a supervisor of Beijing Offcn Education Technology Co., Ltd. From February 2019 to present, he has served as a supervisor of Offcn Education Technology Stock Co., Ltd.

Ms. Li Wen , born in 1979, is a Chinese citizen and has no permanent residency abroad. She owns a master’s degree and is qualified as a Chinese lawyer. She started her journey in education industry in the year of 2007. From 2007 to 2010, she worked as a teacher and R&D staff in Beijing Offcn Online Education Technology Co., Ltd. Starting from 2010, she firstly served as a teacher, then the dean’s assistant and successively the dean of Interview Training Department in Offcn Ltd. From November 2015 to December 2018, she served as the supervisor representing employees of Beijing Offcn Education Technology Stock Co., Ltd. From December 2018 to present, she has served as a supervisor of Beijing Offcn Education Technology Co., Ltd. From February 2019 to present, she has served as a supervisor of Offcn Education Technology Stock Co., Ltd.

(3)Senior Executives

Please see the above for Mr. Wang Zhendong’s resume.

Mr. He Youl i, born in 1975, is a Chinese citizen and has no permanent residency abroad. He started working in education industry in the year of 1999. From 2005 to 2010, he was in charge of marketing operations of Beijing Offcn Online Education Technology Co., Ltd. From 2010 to November 2015, he served as an assistant president and successively the vice president of Beijing Offcn Future Education Consultancy Co., Ltd. From November 2015 to December 2018, he was employed as the deputy general manager of Beijing Offcn Education Technology Stock

Offcn Education Technology Co., Ltd. 2021 Annual Report

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Co.,Ltd. From December 2018 to present, he has served as the deputy general manager of Beijing Offcn Education Technology Co., Ltd. From February 2019 to present, he has served as the deputy general manager of Offcn Education Technology Stock Co., Ltd.

Mr. Luo Xue , born in 1968, is a Chinese citizen and has no permanent residency abroad. He owns a bachelor’ s degree and is a certified public accountant, a registered asset appraiser and an intermediate accountant. From July 1991 to September 2000, he worked at the Zhongyuan Oil Field of Sinopec. From October 2000 to January 2011, he was successively employed by Beijing Pan-China CPA Ltd., Deloitte Touche Tohmatsu CPA Ltd. and Reanda Certified Public Accountants LLP, where he held the posts from audit manager to technical partner. From February 2011 to August 2014, he served as the financial director and secretary of the Board of Cortech Drilling Equipment Ltd. From August 2014 to December 2016, he was employed as the CFO of LandOcean Energy Services Co., Ltd. From 2017 to December 2018, he was the head of the financial department of Beijing Offcn Education Technology Stock Co., Ltd. From February 2019 to present, he has served as the financial director of Offcn Education Technology Stock Co., Ltd.

Mr. Gui Hongzhi , born in 1971, is a Chinese citizen and has no permanent residency abroad. He owns an MBA degree. From April 2003 to August 2006, he worked at the CRED Holding Co., Ltd. as the manager of Securities Department. In the same company, he served as the deputy general manager and secretary of the Board from August 2006 to July 2015. From September 2015 to December 2018, he was employed as head of Securities Affairs Department by Beijing Offcn Education Technology Stock Co., Ltd. From February 2019 to present, he has served as the deputy general manager and secretary of the Board of Offcn Education Technology Stock Co., Ltd.

Positions held in shareholders entities:

√Applicable □Not applicable

Name	Name of the shareholder entity	Position in the shareholder entity	Start date	End date	Receiving payment from the shareholder entity or not?
Wang Zhendong	Beijing Offcn Future Information Consulting Center (Limited Partnership)	Executive Partner	April 10, 2018	To date	N/A
Particulars about holding position in shareholders entities	None

Employment in other companies

√Applicable □Not applicable

Name	Name of the company	Positions held in the company	Start date	End date	Receiving payment from the company or

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Offcn Education Technology Co., Ltd. 2021 Annual Report

					not?
Li Yongxin	Beijing Offcn Education Technology Co., Ltd	Chairman of the Board	December 27, 2018	To date	Yes
Li Yongxin	Kunming Wuhua Offcn Training School	President of the council	January 18, 2015	To date	N/A
Li Yongxin	Beijing Offcn Future Group Co., Ltd.	Supervisor	June 13, 2019	To date	N/A
Li Yongxin	Yanyuan Alumni Investment Management Co., Ltd.	Supervisor	January 21, 2019	To date	N/A
Li Yongxin	Beijing Haidian Offcn Training School	President of the council	July 22, 2009	To date	N/A
Li Yongxin	Beijing Haidian Baoquan Financial Training Center	President of the council	May 19, 2014	To date	N/A
Li Yongxin	Urumqi Shayibake Offcn Training Center	Chairman of the Board	January 13, 2014	To date	N/A
Shi Lei	Beijing Offcn Education Technology Co., Ltd	Director	December 27, 2018	To date	Yes
Shi Lei	Hainan Huiyou Film&TV Technology Co., Ltd.	Director	March 10, 2017	To date	N/A
Shi Lei	Taiyuan Hi-Tech Zone Offcn Training School	Council member	March 4, 2013	To date	N/A
Shi Lei	Urumqi Shayibake Offcn Training Center	Council member	January 13, 2014	To date	N/A
Shi Lei	Guangxi Oriental Dreamland Tourism&Healthcare Investment Co., Ltd.	Director	February 24, 2021	To date	N/A
Wang Zhendong	Beijing Offcn Education Technology Co., Ltd.	Director	December 27, 2018	To date	Yes
Wang Zhendong	Beijing Offcn Future Education Technology Co., Ltd	Director	March 25, 2020	To date	N/A
Wang Zhendong	Lu’an Yazhong Real Estate Information Consulting Co., Ltd.	Executive director and general manager	January 10, 2022	To date	N/A
Wang Zhendong	Lu’an Zhongke Real Estate Information Consulting Co., Ltd.	Executive director and general manager	January 10, 2022	To date	N/A
Wang Zhendong	Beijing Offcn Century Education Technology Co., Ltd	Executive director and general	November 11, 2021	To date	N/A

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Offcn Education Technology Co., Ltd. 2021 Annual Report

		manager
Wang Zhendong	Beijing Xindezhiyuan Enterprise Management Consultancy Co., Ltd.	Supervisor	August 6, 2014	To date	N/A
Wang Zhendong	Beijing Offcn Xinzhiyu Network Technology Co., Ltd.	Supervisor	May 8, 2012	To date	N/A
Wang Zhendong	Beijing Offcn Future Research Education Technology Co., Ltd.	Executive director and general manager	December 4, 2020	To date	N/A
Wang Zhendong	Taiyuan Hi-Tech Zone Offcn Training School	President of the council	March 4, 2013	To date	N/A
Wang Zhendong	Tangshan Lunan Offcn Training School	President of the council	March 1, 2013	To date	N/A
Wang Zhendong	Urumqi Shayibake Offcn Training Center	Council member	January 13, 2014	To date	N/A
Chen Yuqin	Shanghai Yuqinyangde Information Technology Consulting Co., Ltd.	Supervisor	March 15, 2021	To date	Yes
Chen Yuqin	Hengxin Shambala Culture Co., Ltd.	Director	August 5, 2021	To date	Yes
Jiang Tao	Chengdu Xinzhu Road & Bridge Machinery Co., Ltd.	Independent director	October 16, 2019	To date	Yes
Jiang Tao	Southwestern University of Finance and Economics	Professor	September 1, 2008	To date	Yes
Tong Yan	Beijing Institute of Technology	Professor	July 01, 2016	To date	Yes
Tong Yan	Hebei Jinniu Chemical Industry Co., Ltd.	Independent director	March 16, 2016	To date	Yes
Tong Yan	Beijing Interactive Network Technology Co., Ltd.	Independent director	October 25, 2019	To date	Yes
Tong Yan	China Fund Management Co., Ltd.	Independent director	July 16, 2020	To date	Yes
Tong Yan	Financial Street Property Management Co., Ltd.	Independent director	June 9, 2020	To date	Yes
He Di	Beijing Offcn Education Technology Co., Ltd	Supervisor	December 27, 2018	To date	Yes
He Di	Beijing Offcn Future Education Technology Co., Ltd.	Supervisor	March 25, 2020	To date	N/A
He Di	Tianjin Hexi Offcn Training School Co., Ltd.	Director	July 15, 2019	To date	N/A
He Di	Yuxi Offcn Training School Co., Ltd.	Director	December 24, 2018	To date	N/A

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Offcn Education Technology Co., Ltd. 2021 Annual Report

He Di	Lu’an Yazhong Real Estate Information Consulting Co., Ltd.	Supervisor	January 10, 2022	To date	N/A
He Di	Lu’an Zhongke Real Estate Information Consulting Co., Ltd.	Supervisor	January 10, 2022	To date	N/A
He Di	Beijing Offcn Century Education Technology Co., Ltd.	Supervisor	November 11, 2021	To date	N/A
He Di	Beijing Offcn Future Research Education Technology Co., Ltd.	Supervisor	December 4, 2020	To date	N/A
Zhang Xuanming	Hebei Xinmiao Tourism Development Co., Ltd	Supervisor	October 28, 2015	To date	Yes
Yi Ziting	Beijing Offcn Education Technology Co., Ltd	Chairman of the Supervisory Committee	December 27, 2018	To date	Yes
Li Wen	Beijing Offcn Education Technology Co., Ltd	Supervisor	December 27, 2018	To date	Yes
Particulars about holding positions in other companies	None

Details of penalties in the past three years from securities regulatory institutions to directors, supervisors, and senior executives who are currently holding the positions in the Company and those who had resigned from the Company during the reporting period

√Applicable □Not applicable

On December 25, 2021, the Company was filed and investigated by China Securities Regulatory Commission (CSRC) on suspicion of failing to disclose related party transaction information and violating the laws and regulations of information disclosure. On April 27, 2022, the relevant parties received the official Decision of Administrative Penalty . Due to the Company ’ s failure to truthfully disclose related-party relationships and related-party transactions as required, the Anhui Securities Regulatory Bureau of the CSRC decided to give a warning to and impose a fine of RMB 2 million yuan on the Company’s Chairman of the Board of Directors Li Yongxin and Director Shi Lei respectively, give a warning to and impose a fine of RMB 1 million yuan on Wang Zhendong, the Director and General Manager of the Company, and give a warning to and impose a fine of RMB 0.5 million yuan on the Company’s CFO Luo Xue and the Secretary of the Board Gui Hongzhi respectively.

3. Remuneration for directors, supervisors and senior executives

The decision-making procedure, determination basis and actual payment of remuneration for directors, supervisors

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and senior executives

In order to further improve the remuneration system for the Company ’ s directors, supervisors, and senior executives, and fully motivate the enthusiasm for work of the Company ’ s directors, supervisors, and senior executives, the Company formulated the Regulations of Remuneration System of Directors, Supervisors, and Senior Executives . On June 15, 2021, the shareholders’ meeting reviewed and approved the Proposal on Determining the Remuneration Plan in the year of 2021 for Directors, Supervisors and Senior Executives of the Company , which further clarified the remuneration plan for directors, supervisors and senior executives. The allowances for independent directors are issued quarterly. The Company does not provide additional allowances for internal directors or internal supervisors. The remuneration of the Company’s internal directors, internal supervisors and senior executives is issued according to the Company’s salary system.

Remuneration of directors, supervisors, senior executives during the reporting period:

Unit: RMB 10 thousand

Name	Position	Gender	Age	Tenure Status	Total before-tax remuneration gained from the Company	Whether gained remuneration from the related parties of the Company
Li Yongxin	Chairman of the Board	Male	46	Incumbent	48.21	N/A
Wang Zhendong	Director, general manager	Male	46	Incumbent	51.38	N/A
Shi Lei	Director	Male	46	Incumbent	62.88	N/A
Yi Ziting	Director	Female	48	Incumbent	50.23	N/A
Wang Qiang	Independent director	Male	45	resigned	12.00	N/A
Tong Yan	Independent director	Female	45	resigned	12.00	N/A
Zhang Xuanming	Independent director	Male	44	Incumbent	12.00	N/A
Yu Hongwei	Chairman of the Supervisory Committee	Female	56	Incumbent	18.00	N/A
He Di	Supervisor	Male	45	Incumbent	52.68	N/A
Li Wen	Supervisor	Female	43	Incumbent	49.83	N/A
Wang Xuejun	Deputy general manager	Male	59	resigned	71.62	N/A
He Youli	Deputy general manager	Male	47	Incumbent	63.34	N/A
Luo Xue	Chief financial officer	Male	54	Incumbent	59.07	N/A
Gui Hongzhi	Secretary of the Board,	Male	51	Incumbent	48.80	N/A

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	deputy general manager
Total	--	--	--	--	612.04	--

Section VI. Performance of duties by directors during the reporting period

1. Board meetings during the reporting period

Session	Convening date	Disclosure date	Resolution
The 17th Meeting of the 5th Board of Directors	January 26, 2021	January 27, 2021	For details, refer to the Announcement on Resolutions of the 17th Meeting of the 5th Board of Directors(No. 2021-009) disclosed on www.cninfo.com.cn.
The 18th Meeting of the 5th Board of Directors	April 28, 2021	April 29, 2021	For details, refer to the Announcement on Resolutions of the 18th Meeting of the 5th Board of Directors(No. 2021-019) disclosed on www.cninfo.com.cn.
The 19th Meeting of the 5th Board of Directors	May 28, 2021	May 29, 2021	For details, refer to the Announcement on Resolutions of the 19th Meeting of the 5th Board of Directors(No. 2021-034) disclosed on www.cninfo.com.cn.
The 20th Meeting of the 5th Board of Directors	June 2, 2021	June 3, 2021	For details, refer to the Announcement on Resolutions of the 20th Meeting of the 5th Board of Directors(No. 2021-039) disclosed on www.cninfo.com.cn.
The 21st Meeting of the 5th Board of Directors	August 30, 2021	August 31, 2021	For details, refer to the Announcement on Resolutions of the 21st Meeting of the 5th Board of Directors(No. 2021-058) disclosed on www.cninfo.com.cn.
The 22nd Meeting of the 5th Board of Directors	September 26, 2021	September 27, 2021	For details, refer to the Announcement on Resolutions of the 22nd Meeting of the 5th Board of Directors(No. 2021-062) disclosed on www.cninfo.com.cn.
The 23rd Meeting of the 5th Board of Directors	October 29, 2021	--	Reviewed and approved the_Third Quarter_ 2021 Report of the Company(No. 2021-067)
The 24th Meeting of the 5th Board of Directors	December 6, 2021	December 7, 2021	For details, refer to the Announcement on Resolutions of the 24th Board Meeting of the 5th Board of Directors (No. 2021-074) disclosed on www.cninfo.com.cn.

2. Attendance of directors at board meetings and shareholders’ meetings

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Attendance of directors at board meetings and shareholders’ meetings	Attendance of directors at board meetings and shareholders’ meetings	Attendance of directors at board meetings and shareholders’ meetings	Attendance of directors at board meetings and shareholders’ meetings	Attendance of directors at board meetings and shareholders’ meetings	Attendance of directors at board meetings and shareholders’ meetings	Attendance of directors at board meetings and shareholders’ meetings	Attendance of directors at board meetings and shareholders’ meetings
Director	Sessions required to attend during the reporting period (times)	Attendanc e in person (times)	Attendance by way of telecommuni cation (times)	Entrusted presence (times)	Absence (times)	Non-attendan ce in person for two consecutive (times)	Attendance in shareholders’ meetings (times)
Li Yongxin	8	8	0	0	0	N/A	1
Wang Zhendong	8	8	0	0	0	N/A	2
Shi Lei	8	8	0	0	0	N/A	2
Yi Ziting	8	8	0	0	0	N/A	2
Wang Qiang	8	6	2	0	0	N/A	2
Tong Yan	8	1	7	0	0	N/A	1
Zhang Xuanming	8	3	5	0	0	N/A	2

Explanation of non-attendance in person for two consecutive times

None

3. Particulars about directors objecting on relevant issues of the Company

Whether there were any objections on relevant issues of the Company from directors

□Yes √No

During the reporting period, there were no objections from directors on relevant issues of the Company.

4. Other explanations on the performance of duties by directors

Whether relevant advice to the Company from directors were adopted

√Yes □No

Explanation of advice from directors to the Company being adopted or not being adopted

During the reporting period, the Company’s directors scrupulously exercised their rights and performed their duties in strict accordance with relevant regulations. They carefully reviewed the issues raised by the Board of Directors and the professional committees and actively expressed opinions and views. With rich professional experience, the independent directors of the Company expressed their thoughtful, rational and independent opinions on each issue that required their judgements. They also put forward many instructive and reasonable suggestions on the Company ’ s development strategy and standardized operation, which played a catalytic role in scientific decision-making of the Company. For more details, please refer to the 2021 Independent Directors’ Debriefing Report published on www.cninfo.com on the same day as this annual report.

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Section VII. Performance of duties by special committees under the Board during the reporting period

Committee	Member	Times of meeting s	Convening date	Contents of meetings	Important comments and suggestions put forward	Other particulars about the performanc e of duties	Details of objections （if any）
Audit Committee	Tong Yan, Wang Qiang, Shi Lei	7	January 29, 2021	2020 Fourth Quarter Internal Audit Report	After careful review of the 2020 Fourth Quarter _Internal Audit Report_issued by the internal audit department, it is believed that the preparation of the Company's financial report for this period complies with the relevant provisions of laws and regulations, _Articles of Corporation_and the Company's internal management regulations. Internal control processes can effectively prevent operational risks and regulate financial processes.	Performing duties in strict accordance with laws and regulations	None
			February 26, 2021	2020 Annual Internal Audit Report	The_2020 Annual Internal_ _Audit Report_prepared by the Company's internal audit department screened the internal control nodes, i.e. the applications and approvals of various business processes. The operations basically complied with the requirements of internal control regulations.	Performing duties in strict accordance with laws and regulations	None
			April 26, 2021	1.2020 Annual Self-evaluati on Report on Internal Control	1. The_2020 Annual_ Self-evaluation Report on _Internal Control_objectively evaluated the effectiveness of internal control on the reporting base date on the	Performing duties in strict accordance with laws and	None

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				2.Review on 2020 Annual Audit Report 3.Proposal on the Estimated Amount of Daily Related-Part y Transactions in 2021 4.Statement on the Difference Between the Actual Net Profit and the Promised Net Profit in 2020 of Beijing Offcn Education Technology Co., Ltd 5.Proposal on appointment of the Audit Institution in 2021 6.Job Evaluation of the Audit Institution in 2020 7.Full Text and Main Body of the 2021 First Quarter	basis of internal control, daily supervision and special supervision, and found no material weakness of internal control over the Company's financial reports or non-financial reports. The Company has maintained effective internal control in all major aspects in accordance with the enterprise internal control standard system and related regulations. 2. The re-appointment of Baker Tilly China Certified Public Accountants (LLP) to audit the Company’s 2021 Financial Report and Internal Control Report guarantees the continuity of the Company’s audit work. 3. After conducting sufficient communication and discussions, the audit committee provided reasonable suggestions for the 2021 first quarter internal audit work in strict accordance with the Working Rules of the Audit _Committee_and relevant laws and regulations.	regulations

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				Report 8.2021 First Quarter Internal Audit Report
			August 20, 2021	1.Full Text and Abstract of 2021 Semi-annual Report 2.2021 Second Quarter Internal Audit Report	1. The Company's semi-annual report objectively and faithfully reflects the Company's financial status and operating results. 2. The_2021 Second Quarter_ _Internal Audit Report_was reviewed and confirmed to be effective for preventing operational risks and standardizing financial processes.	Performing duties in strict accordance with laws and regulations	None
			October 25, 2021	1.Full Text and Main Body of 2021 Third Quarter Report 2.2021 Third Quarter Internal Audit Report	1. The Company's third quarter report objectively and faithfully reflects the Company's financial status and operating results. 2. The internal audit work of the Company should be carried out based on the Company’s actual situation.	Performing duties in strict accordance with laws and regulations	None
			December 30, 2021	2022 Annual Internal Audit Plan	Aiming at preventing operational risks, standardizing financial processes, and improving management levels, the 2022 Annual Internal Audit _Plan_prepared by the internal audit department meets the needs of the Company's development.	Performing duties in strict accordance with laws and regulations	None
Remuneratio n and Appraisal Committee	Wang Qiang, Tong Yan, Wang Zhendong	1	April 16, 2021	Proposal on the 2021 Remuneratio n Plan for	After careful discussion, the committee believes that the remuneration plan for the Company's directors,	Performing duties in strict accordance	None

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				the Company’s Directors, Supervisors and Senior Executives	supervisors and senior executives in 2021 is formulated based on the remuneration level of the Company's industry and the its actual operating conditions, which is beneficial to the Company’s sustainable development.	with laws and regulations
Nomination Committee	Zhang Xuanming, Tong Yan, Li Yongxin	1	April 15, 2021	Proposal on the Performance of Duties of Professional Committees Under the Board of Directors	The committee reviewed the performance of duties of the four professional committees under the Board of Directors during the reporting period.	Performing duties in strict accordance with laws and regulations	None
Strategy and Investment Committee	Li Yongxin, Shi Lei and Wang Qiang	1	December 1, 2021	Proposal on Termination of the Non-public Issuance of A Shares and Withdrawal of Application Documents	After full discussion by the participating members, it is considered that the termination of the non-public issuance of A shares is a prudent decision made by the Company after comprehensive consideration of the capital market environment, the development of the fund-raising project, the actual situation of the Company and the timing of financing, which will not have a significant impact on the normal operation and sustainable and stable development of the Company and will not be detrimental to the interests of the Company.	Performing duties in strict accordance with laws and regulations	None

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Section VIII. Performance of duties by the Supervisory Committee

Were there any risks in the Company according to the supervision of the Supervisory Committee during the reporting period?

□Yes √No

The Supervisory Committee raised no objection to matters under supervision during the reporting period.

Section IX. Employees of the Company

1. Number of employees, role type, and educational background

Number of current employees of the parent company at the end of the reporting period (person)	0
Number of current employees of the major subsidiaries at the end of the reporting period (person)	36,143
Total number of current employees at the end of the reporting period (person)	36,143
Total number of employees receiving remuneration from the Company during the reporting period (person)	36,143
Number of retired employees for which the parent company and major subsidiaries need to bear the expenses (person)	0
Role type
Category	Number (person)
Management personnel	3,619
R&D staff	2,452
Teachers	14,590
Customer service staff	4,599
Marketing staff	10,883
Total	36,143
Educational background
Category	Number (person)
Master’s degree and above	6,537
Bachelor’s degree	26,950
Postsecondary specialised college	2,634
Secondary specialised school and below	22
Total	36,143

2. Remuneration policy

During the reporting period, the Company, based on the post value, set salary difference scientifically and further improved the performance appraisal system of human resources. The Company regularly and comprehensively

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evaluated employees’ working skills and their recognition of corporate culture by an evaluation method based on quantitative indicators of performance and qualitative standards to ensure that both the work results and growth of employees were given attention to. The Company attracts and retains its core talents through a diversified performance-oriented incentive mechanism, so that the core personnel can be more closely aligned with the interests of the Company and its shareholders. In this way, the Company's long-term operating performance will be driven to grow continuously.

3. Training plan

During the reporting period, the Company continuously invested high-quality resources in optimizing the training system and enhancing the capabilities of the teaching team. Employees are well supported with knowledge resources and abundant learning choices to develop their talents and careers. Under the normalization of COVID-19 prevention and control, the Company accelerated the trend of online learning for all staff. By integrating online and offline resources, the Company has realized the plan of the whole curriculum system sharing, empowering employees with more opportunities to learn and grow.

In terms of training organizing, the Company mobilized human resources department both at the headquarter and branches as well as management personnel to ensure that the staff trainings are well organized. The human resources department at the headquarter are responsible for the “ planning, research and coordination ” of the Company’s overall training, focusing on the construction of training resources and training platform as well as the design and implementation of key talent training projects. The human resources departments of branches are responsible for exploring the training needs of employees, providing training solutions, executing the training plans, and focusing on the daily-basis operation and training. Management personnel are responsible for employees ’ ability-building, taking training of team members as part of their work tasks, so as to develop more talents for the Company.

4. Labor outsourcing

□Applicable √Not applicable

Section X. Profit distribution of the Company and conversion of capital reserve into share capital

The formulation, implementation and adjustment of the profits distribution policy, especially the cash dividends policy, during the reporting period.

□Applicable √Not applicable

The Company was profitable during the reporting period and the parent company’s profit available for distribution to shareholders was positive but did not propose a plan for the distribution of cash dividend.

□Applicable √Not applicable

Profit distribution and conversion of capital reserve into share capital during the reporting period

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□Applicable √Not applicable

The Company plans not to distribute cash dividends or bonus shares, nor to increase share capital by converting capital reserve.

Section XI. Implementation of the Company ’ s equity incentive plan, employee stock ownership plan or other employee incentive measures

Applicable √Not applicable

There were no equity incentive plan, employee stock ownership plan or other employee incentive measures being implemented during the reporting period of the Company.

Section XII. Establishment and implementation of the Company ’ s internal control system during the reporting period

1. The establishment and implementation of the Company’s internal control

During the reporting period, in accordance with the Basic Standards for Enterprise Internal Control as well as its corresponding supporting regulations, and the Company ’ s Regulations of Internal Audit , based on regular supervision and special supervision of internal control, the Company, adhering to the risk-oriented principle, continuously improves and optimizes its internal control system to adapt to the ever-changing external environment and meet the internal management requirements. The Company’s Board of Directors establishes, improves and effectively implements internal control, evaluates its effectiveness, and truthfully discloses the evaluation report on internal control, in accordance with the regulations of the Company ’ s internal control standard system; the Supervisory Committee supervises the Board of Directors on the establishment and implementation of internal control. The Company’s management personnel take responsibility for organizing and leading the regular operation of the Company’s internal control. The Company established an internal audit department equipped with full-time auditors and formulated internal audit-related management regulations. The internal audit department is responsible for and reports to the Audit Committee of the Board of Directors; in accordance with the requirements of national laws, rules and regulations, the internal audit department independently and objectively exercises its powers of internal audit, inspects and supervises the internal control of the Company and its controlled subsidiaries, conducts internal audit for their finance and operations, provides audit suggestions,, and implements the internal control rectification.

2. Particulars about material weakness found in the Company’s internal control during the reporting period

□Yes √No

Section XIII. The Company’s management and control of subsidiaries during the reporting period

Not applicable

Section XIV. Self-evaluation report or audit report on internal controls

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1 . Self-evaluation report on internal controls

Disclosure date of full text of self-evaluation report on internal control	April 29, 2022	April 29, 2022
Disclosure index of full text of self-evaluation report on internal control	CNINFO (www.cninfo.com.cn) Offcn Education Technology Co., Ltd. 2021 Self-evaluation Report on Internal Control
Proportion of assets evaluated in total assets stated in the consolidated financial statement of the Company	100.00%
Proportion of operating income evaluated in total operating income stated in the consolidated financial statement of the Company	100.00%
Deficiency Standards
Category	Financial Report	Non-Financial Report
Qualitative criteria	Material Weakness: one deficiency, or a combination of deficiencies in internal control that may result in a significant deviation from the control objectives of the Company. Those with the following characteristics should be recognized as material weakness: ①Fraud of directors, supervisors and senior executives; ② Correction of misstatement in previously issued financial statements; ③Material misstatement in current financial statements that are not detected by the Company’s internal control; ④Invalid supervision of internal control over financial reporting by the Company’s Audit Committee and internal audit department. Significant Deficiency: one deficiency, or a combination of deficiencies in internal control that is less severe than a material weakness, yet may still result in a deviation from control objectives of the Company. Controllable Deficiency: Other internal control deficiencies that do not meet the standards of material weakness or significant deficiency.	Material Weakness: ①Severe violations of national laws and regulations in the Company’s operation; ②Negative news frequently disclosed by the media and the negative impact has not been eliminated; ③Serious loss of middle and senior management personnel and senior technical personnel; ④Lack or ineffectiveness of policy for major business; ⑤Rectifications are not made for the material weaknesses or significant deficiencies in the Company’ s internal control. Significant Deficiency: one deficiency, or a combination of deficiencies in internal control that is less severe or has minor economic consequences than a material weakness, yet may still result in a deviation from control objectives of the Company. Controllable Deficiency: Other internal control deficiencies that do not meet the standards of material weakness or significant deficiency.
Quantitative criteria	Material Weakness: Misstatements account for more than 5% of total profits.	Refer to the quantitative criteria for the evaluation of internal control

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	Significant Deficiency: Misstatements account for 2% to 5% (including 5%) of total profits. Controllable Deficiency: Misstatements account for less than 2% (including 2%) of total profits.	deficiencies in financial reports.
Number of material weaknesses in the financial report	0
Number of material weaknesses in the none-financial report	0
Number of significant deficiencies in the financial report	0
Number of significant deficiencies in the non-financial report	0

2. Audit report on internal control

Applicable √Not applicable

Section XV. Special actions on self-examination and rectification of the listed Company ’ s governance

Not applicable

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Chapter 5 Environmental and social responsibilities

Section I. Environmental protection

Do the listed Company and its subsidiaries belong to the major pollutant discharge units announced by the Ministry of Ecology and Environment？

□Yes √No

Situations of receiving administrative penalty due to environmental issues during the reporting period Not applicable

Other environmental information disclosed in reference with major pollutant discharge units

The Company always practices its corporate social responsibilities, complies with national and local laws and regulations on environmental protection and emission targets, conscientiously implements various environmental protection management regulations, and continuously promotes energy conservation, emission reduction and environmental protection by promoting paperless operations. At the same time, the Company also integrates and implements the concept of environmental protection into all levels of strategic decision-making and business, and encourages its employees to carry out green volunteer activities to jointly contribute to the harmonious development of society. During the reporting period, the Company had no violations of environmental protection laws and regulations and no disputes over pollution accidents, and was not subject to administrative penalties for violating relevant environmental protection laws and regulations.

Measures taken to reduce carbon emissions during the reporting period and their effects

□Applicable √Not applicable

Reasons of not disclosing other environmental information

□Applicable √Not applicable

Section II. Social Responsibilities

For details of the Company's performance of social responsibilities, please refer to the 2021 Annual Report on Social Responsibilities of OFFCN EDU disclosed by the Company on CNINFO ( www.cninfo.com) on the same day.

Section III. Conducts to consolidate and expand the achievements of poverty alleviation and rural revitalization

□Applicable √Not applicable

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Chapter 6 Significant Events

Section I. Fulfillment of commitments

1. Commitments that the Company ’ s actual controllers, shareholders, related parties, acquirers, the Company itself and other relevant parties have fulfilled during the reporting period and have not fulfilled as of the end of the reporting period

√Applicable □ Not applicable

Commitment Party	Commitment Type	Main contents of commitment	Commit ment time	Commit ment period	Performance
Yaxia Industrial, Zhou Xiayun, Zhou Hui, Zhou Li, Phase-I employee stock ownership plan	Letter of commitment on lock-up period	1. Within 36 months after the completion of the transaction (starting from the date of the listing of shares issued in this transaction), the shares of Yaxia Auto that held by the company/myself/the plan with rights and interests shall not be transferred. 2. After the completion of the transaction, the shares held by the company/myself/the plan, derived from Yaxia Auto shares due to the distribution of stock dividends and the conversion of capital reserve to share capital, shall also comply with the above-mentioned arrangement of restricted sale of shares. 3. If the China Securities Regulatory Commission (CSRC) and/or Shenzhen Stock Exchange (SSE) have/has other provisions for the above-mentioned lock-up period arrangement, the company/I/the plan will adjust and implement the above-mentioned lock-up period arrangement according to the latest regulations of the CSRC and/or SSE. If violating the above commitments, the company/I/the plan will bear all losses caused to Yaxia Auto.	May 4, 2018	Jan. 31, 2022	Fulfilled
Li Yongxin	Letter of Commitment on lock-up period for subscription of shares	1. The shares of the listed Company subscribed by myself in this transaction shall not be transferred or dealt with in any other forms within 36 months from the date of the listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days, or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue	Apr. 27, 2018	Jan. 31, 2022	Under normal implementatio n

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price, the lock-up period of consideration shares acquired by myself shall be automatically extended for 6 months. (If dividend or bonus shares distribution, conversion of capital reserve or allotment by the listed Company occurred during the above-mentioned period, the aforementioned issue price shall be calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. As the transferee of 72,696,561 Yaxia Auto shares held by Anhui Yaxia Industrial Co., Ltd., I shall not transfer such shares within 36 months from the registration date of such shares in my securities account. 3. The aforesaid arrangement of share lock-up does not affect the implementation of profit compensation for this transaction, that is, when I need to make profit compensation, the listed Company has the right to relieve the lock-up of shares in corresponding amount in advance for profit compensation.

I promise to abide by the following provision: if the transaction is investigated by judiciary authorities or CSRC on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 5. After the completion date of this transaction, my increased shares due to bonus shares distribution or conversion of capital reserve of the listed Company shall also comply with the foregoing requirements. 6. If the aforementioned lock-up period arrangement does not comply with the latest laws and regulations or the latest regulatory requirements of the securities regulatory institution, I agree to implement the arrangement in accordance with the latest laws and regulations and the requirements of the securities regulatory institution. 7. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of CSRC and SSE.

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Lu Zhongfang	Letter of commitment on lock-up period for subscription of shares	1. The shares of the listed Company subscribed by myself in this transaction shall not be transferred or dealt with in any other forms within 36 months from the date of the listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed company stock is lower than the issue price for consecutive 20 trading days , or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired by myself shall be automatically extended for 6 months. (If dividend or bonus shares distribution, conversion of capital reserve or allotment by the listed company occurred during the above-mentioned period, the aforementioned issue price shall be calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. The aforesaid arrangement of share lock-up does not affect the implementation of profit compensation for this transaction, that is, when I need to make profit compensation, the listed Company has the right to relieve the lock-up of shares in corresponding amount in advance for profit compensation. 3. I promise to abide by the following provision: if the transaction is investigated by judiciary authorities or CSRC on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 4. After the completion date of this transaction, my increased shares due to bonus shares distribution or conversion of capital reserve of the listed Company shall also comply with the foregoing requirements. 5. If the aforementioned lock-up period arrangement does not comply with the latest laws and regulations or the latest regulatory requirements of the securities regulatory institution, I agree to implement the arrangement in accordance with the latest laws and regulations and the requirements of the securities regulatory institution.	April 27, 2018	Jan 31, 2022	Under normal implementatio n

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		6. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of CSRC and SSE.
Kerui Technology Innovation	Letter of commitment on lock-up period for subscription of shares	1. The shares of the listed Company subscribed by Kerui Technology Innovation in this transaction shall not be transferred or dealt with in any other forms within 36 months from the date of the listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days, or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired by Kerui Technology Innovation shall be automatically extended for 6 months. (If dividend or bonus shares distribution, conversion of capital reserve or allotment by the listed Company occurred during the above-mentioned period, the aforementioned issue price shall be calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. The enterprise promises to abide by the following provision: if the transaction is investigated by judiciary authorities or CSRC on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 3. After the completion date of this transaction, the enterprise’s increased shares due to bonus shares distribution or conversion of capital reserve of the listed Company shall also comply with the foregoing requirements. 4. If the aforementioned lock-up period arrangement does not comply with the latest laws and regulations or the latest regulatory requirements of the securities regulatory institution, the enterprise agrees to implement the arrangement in accordance with the latest laws and regulations and the requirements of the securities regulatory institution. 5. After the lock-up period expires, it will be	July 27, 2018	Jan. 31, 2022	The shares of the Company held by Kerui Technology Innovation were listed and circulated on February 11, 2022, and the shareholders' share lock-up commitment has been fulfilled.

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		implemented in accordance with the relevant regulations of CSRC and SSE.
Aerospace Industry, Guangyin Venture	Letter of commitment on lock-up period for subscription of shares	1. The shares of the listed Company subscribed by Aerospace Industry and Guangyin Venture in this transaction shall not be transferred or dealt with in any other forms within 36 months from the date of the listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days, or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired by Kerui Technology Innovation shall be automatically extended for 6 months. (If dividend or bonus shares distribution, conversion of capital reserve or allotment by the listed Company occurred during the above-mentioned period, the aforementioned issue price shall be calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. The enterprise promises to abide by the following provision: if the transaction is investigated by judiciary authorities or CSRC on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 3. After the completion date of this transaction, the enterprise’s increased shares due to bonus shares distribution or conversion of capital reserve of the listed Company shall also comply with the foregoing requirements. 4. If the aforementioned lock-up period arrangement does not comply with the latest laws and regulations or the latest regulatory requirements of the securities regulatory institution, the enterprise agrees to implement the arrangement in accordance with the latest laws and regulations and the requirements of the securities regulatory institution. 5. After the lock-up period expires, it will be implemented in accordance with the relevant	July 27,2018	Jan 31, 2021	The shares of the Company held by Aerospace Industry and Guangyin Venture were listed and circulated on February 1, 2021, and the shareholders' share lock-up commitments have been fulfilled.

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		regulations of CSRC and SSE.
Wang Zhendong, Guo Shihong, Liu Bin, Zhang Yongsheng, Yang Shaofeng, Zhang Zhi’an	Letter of commitment on lock-up period for subscription of shares	1. The shares of the listed Company subscribed by myself in this transaction shall not be transferred or dealt with in any other forms within 24 months from the date of the listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days , or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired by myself shall be automatically extended for 6 months. (If dividend or bonus shares distribution, conversion of capital reserve or allotment by the listed Company occurred during the above-mentioned period, the aforementioned issue price shall be calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) If the actual performance of Offcn Ltd. In year 2018 or year 2019 is lower than the committed performance stated in the_Profit Forecast_ Compensation Agreement, the lock-up period of the listed Company’s shares acquired by myself in this transaction shall be extended to 36 months. Upon the expiration of 36 months from the date of registration of the above shares into my securities account, if the profit compensation obligations under the_Profit Forecast Compensation Agreement_ have not been fulfilled, the above lock-up period will be extended until the date of fulfillment of the compensation obligations. 2. The aforesaid arrangement of share lock-up does not affect the implementation of profit compensation for this transaction, that is, when I need to make profit compensation, the listed Company has the right to relieve the lock-up of shares in corresponding amount in advance for profit compensation. 3. I promise to abide by the following provision: if the transaction is investigated by judiciary authorities or CSRC on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed	July 27, 2018	Jan 31, 2021	The shares of the Company held by Wang Zhendong, Guo Shihong, Liu Bin, Zhang Yongsheng, Yang Shaofeng and Zhang Zhi’an were listed and circulated on February 1, 2021, and the shareholders' share lock-up commitments have been fulfilled.

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		Company acquired by myself in this transaction shall not be transferred until the conclusion of the investigation is clarified. 4. After the completion date of this transaction, my increased shares due to bonus shares distribution or conversion of capital reserve of the listed Company shall also comply with the foregoing requirements. 5. If the aforementioned lock-up period arrangement does not comply with the latest laws and regulations or the latest regulatory requirements of the securities regulatory institution, I agree to implement the arrangement in accordance with the latest laws and regulations and the requirements of the securities regulatory institution. 6. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of CSRC and SSE.
Offcn Partnership	Letter of commitment on the lock-up of shares	Within 36 months from the date of the transfer of 80,000,000 shares of Yaxia Auto held by Anhui Yaxia Industrial Co., Ltd. to the enterprise, the shares shall not be transferred. The lock-up period of the shares increased during the above period due to bonus shares distribution, conversion of capital reserve or allotment of shares by Yaxia Auto, shall also comply with the foregoing requirements. If the enterprise violates commitments listed above, it will bear all losses caused to Yaxia Auto.	April 27, 2018	Jan 31, 2022	Under normal implementatio n
Li Yongxin and other 10 counterparties	Letter of commitment on the lock-up of Offcn Partnership’s contribution shares	Within 36 months from the date of the transfer of 80,000,000 shares of Yaxia Auto held by Anhui Yaxia Industrial Co.,Ltd. to Beijing Offcn Future Information Consulting Center (Limited Partnership), I or the enterprise shall not in any way transfer the shares of Beijing Offcn Future Information Consulting Center (Limited Partnership) or withdraw from the partnership with Beijing Offcn Future Information Consulting Center (Limited Partnership), nor do we transfer, assign or authorize other entities in any way to fully or partially have the rights and interests indirectly related to the shares of Yaxia Auto held by Beijing Offcn Future Information Consulting Center (Limited Partnership).	July 27, 2018	Jan 31, 2022	Fulfilled
Li Yongxin,	Letter of	1. Guarantee the independence of the listed	April 27,	Long-ter	Under normal

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Lu Zhongfang, Wang Zhendong, Offcn Partnership	commitment on maintaining independence of the listed Company	Company’s personnel (1) It is guaranteed that after the completion of this transaction, the personnel, human resources and remuneration management of the listed Company shall be completely independent from myself/Offcn Partnership, and from other related parties, such as companies, enterprises or economic organizations, controlled by myself/Offcn Partnership. (2) It is guaranteed that after the completion of this transaction, senior executives shall work as full-time employees and receive remuneration in the listed Company. They shall not hold any positions other than directors or supervisors in other companies, enterprises, or economic organizations controlled by myself/Offcn Partnership. (3) It is guaranteed that after the completion of this transaction, the official powers of the shareholders’ meeting and board of directors on personnel appointments and dismissals shall not be interfered. 2. Guarantee the independence of institutes of the listed Company (1) It is guaranteed that after the completion of this transaction, the listed Company shall build a sound structure of corporate governance and develop an independent and complete organizational structure. (2) It is guaranteed that after the completion of this transaction, the general meeting of shareholders, the board of directors, and the supervisory committee shall independently exercise their powers in accordance with laws, regulations and the Company’s_Articles of Corporation_. 3. Guarantee the independence and completeness of the assets of the listed Company. (1) It is guaranteed that after the transaction, the listed Company shall have independent and complete assets related to production and operation. (2) It is guaranteed that after the completion of this transaction, the business premises of the listed Company shall be independent from myself/Offcn Partnership, and other related parties, such as companies, enterprises, or other economic organizations controlled by myself/Offcn Partnership. (3) It is guaranteed that after the completion of this	2018	m	implementatio n

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		transaction, except for normal business dealings, there shall be no capital and assets of the listed Company occupied by myself/Offcn Partnership, or other related parties, such as companies, enterprises or economic organizations, controlled by myself or Offcn Partnership. 4. Guarantee the independence of the listed Company’s business. (1) It is guaranteed that after the completion of this transaction, the listed Company shall have the qualifications of independently conducting business activities and the capabilities of running market-oriented, independent, autonomous, sustainable business. (2) It is guaranteed that after the completion of this transaction, I/Offcn Partnership, or other related parties, such as companies, enterprises, or other economic organization controlled by myself/Offcn Partnership shall avoid businesses which have a competitive relationship with the listed Company and its subsidiaries. (3) It is guaranteed that after the completion of this transaction, I/Offcn Partnership, or related parties, such as companies, enterprises, or other economic organizations controlled by myself/Offcn Partnership shall reduce related-party transactions with the listed Company and its subsidiaries. Related-party transactions that are really necessary and unavoidable shall be conducted in a market-oriented and fair way and perform relevant approval processes and information disclosure obligations in accordance with relevant laws, regulations and regulatory documents. 5. Guarantee the financial independence of the listed Company. (1) It is guaranteed that after the completion of this transaction, the listed Company shall establish an independent financial department with independent financial accounting systems and standardized and independent financial accounting rules. (2)It is guaranteed that after the completion of this transaction, the listed Company shall open bank accounts independently and shall not share bank accounts with myself/Offcn Partnership/other

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		related parties, such as companies, enterprises or other economic organizations controlled by myself or Offcn Partnership. (3) It is guaranteed that after the completion of this transaction, financial personnel hired by the listed Company shall not hold any part-time positions in other related parties, such as companies, enterprises or other economic organizations controlled by myself or Offcn Partnership (4) It is guaranteed that after the completion of this transaction, the listed Company can make financial decisions independently. I/Offcn Partnership shall not interfere with the use of funds by the listed Company. (5) It is guaranteed that after the completion of this transaction, the listed Company will pay taxes independently according to laws. I/Offcn Partnership shall be liable for all losses caused to the listed Company and its subsidiaries due to my/Offcn Partnership’s failure in fulfilling the above commitments.
Li Yongxin, Lu Zhongfang	Letter of commitment on avoiding horizontal competition	1. As of the date of signing this commitment letter, myself, my close relatives and other companies, enterprises or economic organizations controlled by myself and my close relatives, except for Beijing Offcn Online Education Technology Co., Ltd. (hereinafter referred to as Offcn Online), controlled by my relatives Xuhua and Lu Yan, and its affiliated schools which are involved in the same or similar businesses conducted by Offcn Ltd., other related parties are not involved in any same, similar or related businesses conducted by the listed Company, Offcn Ltd. and its affiliated companies and schools. Except for Li Yongxin serving as a director in Kunming Wuhua Offcn training school, which is affiliated to Offcn Online, I neither hold any full-time or part-time positions nor provide consultancy at any companies or enterprises, which conducts competitive businesses with the listed Company, Offcn Ltd. and their affiliates. I also do not directly or indirectly hold any equity or shares of companies or enterprises conducting the same, similar or related businesses as the listed Company, Offcn Ltd. and its affiliates.	Septemb er 20, 2018	1. The transfer of Kairuier Training School in Haidian District of Beijing: within 24 months from the date of the signing of this letter of commit ment 2. The	As of the end of the reporting period, Kairuier Training School in Haidian District of Beijing had been transferred to an unrelated third party. Other commitments are under normal implementatio n

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		2. As of the date of signing this commitment letter, Offcn Online and its two subordinate training schools ’ disposals are as follow: Offcn Online conducts no education businesses (to be canceled after subordinate schools transferred). Kairuier Training School in Haidian District of Beijing is to be transferred to an unrelated third party and the transfer agreement has been signed. If the transfer is not completed within 24 months since the date of signing this commitment letter, I will urge Offcn Online to cancel Kairuier Training School in Haidian District of Beijing. Kunming Wuhua Offcn Training School, associated with Offcn Online, has been closed and it will be transferred to an unrelated third party or will be canceled within 12 months after the formal promulgation and implementation of the amended Implementing Regulations of the Law on the Promotion of Private Education of the People ’ s Republic of China (hereinafter referred to as Implementing Regulations) and the promulgation and implementation of the supporting regulations formulated by the relevant local education authorities in accordance with the amended Implementing Regulations. 3. As of the date of signing this commitment letter, Offcn Ltd. as the organizer intends to transfer its 100% of the organizer’s rights of 33 private schools for non-academic qualifications to Li Yongxin and singed the Agreement on Transfer of Organizer ’s Rights of Private Non-enterprise Schools Affiliated to Beijing Offcn Education Technology Co., Ltd. Li Yongxin is willing to entrust the transferred 33 private non-enterprise schools to Offcn Ltd. and signed the Trusteeship Agreement of Private Non-enterprise Schools. 4. After the completion of this transaction, except for the above-mentioned cases, I promise that during the time of being the actual controller of the listed Company, I, my close relatives and other related parties, such as companies, enterprises or other economic organizations, controlled by myself or my close relatives shall not in any way (including but not limited to self operated or with		transfer of Kunming Wuhua Offcn Training School: within 12 months after the formal promulg ation and impleme ntation of the Impleme nting Regulati ons and the promulg ation and impleme ntation of the supportin g regulatio ns formulat ed by the relevant local educatio n authoriti es in accordan ce with the amended Impleme

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		other parties to operate joint venture, cooperation, joint operation, investment, mergence, and trustee operation home and aboard) engage in the same, similar, related or competitive businesses with the listed Company, including: (1) I will not directly or indirectly operate, participate in or assist others to conduct same, similar businesses or other economic activities which directly or indirectly constitute a competitive relationship with businesses currently operated by the listed Company and its affiliates. (2) I will not directly or indirectly invest on any economic entities whose businesses constitute a direct or indirect competitive relationship with the listed Company and its affiliates. (3) I will not be hired by any competitors that directly or indirectly compete with the listed Company and its affiliates, or provide any advice, assistance or business opportunities directly or indirectly to such competitors; (4) I will not instigate, mislead, encourage or otherwise induce, persuade, or coerce the employees or management personnel in the listed Company and its affiliates to terminate their labor or employment relationship with the Company and its affiliates. (5) I will not urge others to hire employees or management personnel from the listed Company and its affiliates. 5. I promise that if I, my close relatives or other related parties, such as companies, enterprises or other economic organizations controlled by myself and my close relatives obtain any business opportunities from any third party, which can or may compete with the listed Company and its affiliates in the future, I will notify the listed Company and its affiliates in writing within 5 working days. After obtaining the third party ’ s agreement, I will attempt to transfer these business opportunities to the listed Company and its affiliates. 6. I guarantee that I will never use my knowledge about and the information I’m aware of the listed Company and its affiliates to assist third parties to		nting Regulati ons.

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		engage, participate, or invest in businesses or projects that compete with the listed companies and its affiliates. 7. If I violate the above commitments, the benefits obtained by the violation of commitments shall belong to the listed Company and I shall be liable for all losses caused to the listed Company and its affiliates. Within 30 working days since receiving the writing notice from the listed Company, compensation shall be made in cash. 8. I will disclose relevant information in a timely manner if commitments fail to be fulfilled or to be fulfilled on schedule because of objective reasons, such as changes in relevant laws, regulations and policies, or natural disasters. Except for the above-mentioned objective reasons, if the commitment is anyhow unable to be fulfilled or fulfilling the commitment is not conducive to safeguarding the rights and interests of the listed Company, I should fully disclose the reasons and either provide a new commitment to the listed Company and related investors to replace the original one, or propose an exemption from fulfilling the commitment. 9. The commitment is valid starting from the signing date of the commitment letter, to the time when I cease to be the actual controller of the listed Company.
Wang Zhendong, Offcn Partnership	Letter of Commitment on avoiding horizontal competition	1. As of the date of signing this commitment letter, myself, my close relatives and other companies, enterprises or economic organizations controlled by myself, my close relatives or Offcn Partnership, are not involved in any same, similar or related businesses conducted by the listed Company, Offcn Ltd. and its affiliated companies and schools. Except for Wang Zhendong serving as a director in Kairuier Training School in Haidian District of Beijing, which is affiliated to Offcn Online (Offcn Online tends to transfer the rights of Kairuier Training School to an unrelated third party and after this transfer, Wang Zhendong will no longer hold the post as a director in the school), I neither hold any full-time or part-time positions nor provide consultancy at any companies or enterprises, which	April 27, 2018	Long-ter m	Under normal implementatio n

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		conducts competitive businesses with the listed Company, Offcn Ltd. and their affiliates. I also do not directly or indirectly hold any equity or shares of companies or enterprises conducting the same, similar or related businesses as the listed Company, Offcn Ltd. and its affiliates. 2. After the completion of this transaction, I/Offcn Partnership promise(s) that during the time of being shareholders of the listed Company, I, my close relatives and other related parties, such as companies, enterprises or other economic organizations, controlled by myself, my close relatives or Offcn Partnership shall not in any way (including but not limited to self operated or with other parties to operate joint venture, cooperation, joint operation, investment, mergence, and trustee operation home and aboard) engage in the same, similar, related or competitive businesses with the listed Company, including: (1) I will not directly or indirectly operate, participate in or assist others to conduct same, similar businesses or other economic activities which directly or indirectly constitute a competitive relationship with businesses currently operated by the listed Company and its affiliates. (2) I will not directly or indirectly invest on any economic entities whose businesses constitute a direct or indirect competitive relationship with the listed Company and its affiliates. (3) I will not be hired by any competitors that directly or indirectly compete with the listed Company and its affiliates, or provide any advice, assistance or business opportunities directly or indirectly to such competitors; (4) I/Offcn Partnership will not instigate, mislead, encourage or otherwise induce, persuade, or coerce the employees or management personnel in the listed Company and its affiliates to terminate their labor or employment relationship with the Company and its affiliates. (5) I/Offcn Partnership will not urge others to hire employees or management personnel from the listed Company and its affiliates.

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		3. I/Offcn Partnership promise that if I, my close relatives or other related parties, such as companies, enterprises or other economic organizations controlled by myself, my close relatives or Offcn Partnership obtain any business opportunities from any third party, which can or may compete with the listed Company and its affiliates in the future, I/Offcn Partnership will notify the listed Company immediately, and transfer these business opportunities to the listed Company and its affiliates after obtaining the third party’s agreement. 4. I/Offcn Partnership guarantee(s) that I/Offcn Partnership will never use my knowledge about and the information I’m aware of the listed Company and its affiliates to assist third parties to engage, participate, or invest in businesses or projects that compete with the listed Company and its affiliates. I/Offcn Partnership shall be liable for all losses caused to the listed Company and its affiliates due to my/Offcn Partnership ’s failure in fulfilling the above-mentioned commitments.
Li Yongxin, Lu Zhongfang	Letter of Commitment on reducing and regulating related-party transactions	1. After the completion of this transaction, during the time of being the actual controller of the listed Company, I, my close relatives and other companies, enterprises or other economic organizations controlled by myself or my close relatives will try to avoid and reduce the related-party transactions with the listed Company and its affiliates; unless it is necessary for the business development of the listed Company, any related-party transactions with the listed Company and its affiliates will not be conducted. 2. After the completion of this transaction, for the related-party transactions which are unavoidable or reasonable to happen with the listed Company and its affiliates, I, my close relatives and other companies, enterprises or economic organizations controlled by myself or my close relatives, will sign related-party transaction agreements with the listed Company and its affiliates in accordance with the relevant laws, regulations and regulatory documents and follow the general business principles of equality, willingness, equivalence and paid-use. The prices of related-party transactions shall be fair.	July 27, 2018	Long-ter m	Under normal implementatio n

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		Decision-making procedures, lawful information disclosure obligations and relevant reporting and approval procedures regarding the related-party transactions, shall be followed. The status of shareholders shall not be used to damage the legitimate rights and interests of the listed Company and other shareholders. 3. After the completion of this transaction, I will not use the shareholders’ rights of the listed Company to manipulate or instruct the listed Company or its directors, supervisors and senior executives to make the listed Company provide or accept funds, commodities, services or other assets under inequal conditions or engage in any behaviors that would damage the interests of the listed Company. 4. I will urge my close relatives and other companies, enterprises and other economic organizations controlled by myself or my close relatives to fulfill the aforementioned commitments. 5. If I, my close relatives and other companies, enterprises and other economic organizations controlled by myself or my close relatives violate the above commitments, the profits obtained by the violation of commitments shall belong to the listed Company, and I shall be liable for all losses caused to the listed Company and its affiliates. Within 30 working days since receiving the written notice from the listed Company, compensation shall be made in cash. 6. The commitment is valid starting from the signing date of the commitment letter, to the time when I cease to be the actual controller of Yaxia Auto or have any other related relationship with Yaxia Auto.
Wang Zhendong, Aerospace Industry, Offcn Partnership	Letter of Commitment on reducing and regulating related-party transactions	1. After the completion of this transaction, during the time of being the actual controller/shareholder of the listed Company, I, my close relatives, Aerospace Industry, Offcn Partnership and other companies, enterprises or other economic organizations controlled by myself, my close relatives, Aerospace Industry or Offcn Partnership will try to avoid and reduce the related-party transactions with the listed Company and its affiliates.	April 27, 2018	Long-ter m	Under normal implementatio n

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		2. After the completion of this transaction, for the related-party transactions which are unavoidable or reasonable to happen with the listed Company and its affiliates, I, my close relatives, Aerospace Industry, Offcn Partnership and other companies, enterprises or economic organizations controlled by myself, my close relatives, Aerospace Industry or Offcn Partnership, will follow the general business principles of equality, willingness, equivalence and paid-use. The prices of related-party transactions shall be fair. Decision-making procedures, lawful information disclosure obligations and relevant reporting and approval procedures regarding the related-party transactions shall be followed and fulfilled in accordance with the relevant laws, regulations and regulatory documents. The status of shareholders shall not be used to damage the legitimate rights and interests of the listed Company and other shareholders. 3. After the completion of this transaction, I/Aerospace Industry/Offcn Partnership will not use the shareholders’ rights of the listed Company to manipulate or instruct the listed Company or its directors, supervisors and senior executives to make the listed Company provide or accept funds, commodities, services or other assets under inequal conditions or engage in any behaviors that would damage the interests of the listed Company. I/Aerospace Industry/Offcn Partnership shall be liable for all losses caused to the listed Company and its affiliates due to my/Aerospace Industry’ s/Offcn Partnership’s failures in fulfilling commitments.
Whether the commitments are fulfilled on time	Yes

2. Should there be any profit forecast for any of the Company’s assets or projects and the current reporting period is still within the forecast period, the Company shall explain whether the performance of the asset or project matches with the profit forecast and why.

□Applicable √Not applicable

Section II. The capital occupation of the listed Company for non-operating purposes by the

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controlling shareholder and its related parties

□Applicable √Not applicable

During the reporting period, there was no such situation for the Company.

Section III. Illegal external guarantee

□Applicable √Not applicable

There is no illegal external guarantee in the Company during the reporting period.

Section IV. Statement of the Board of Directors on the latest "non-standard audit report"

□Applicable √Not applicable

Section V. Statement of the Board of Directors, Supervisory Committee, and independent directors (if any) on the accounting firm's "non-standard audit report" during the reporting

period

□Applicable √Not applicable Section VI. Particulars of changes in accounting policies and accounting estimates or corrections of major accounting errors compared with the financial report of the previous year √ Applicable □ Not applicable

1. Changes in accounting policies

On April 28, 2021, the 18th meeting of the fifth Board of Directors of the Company approved that since January 1, 2021, the Company shall adopt the relevant stipulations of the Accounting Standards for Business Enterprises No. — 21 Leasing(Accounting [2018] No. 35). According to the accumulated impact, right-of-use assets, lease liability and the amount of retained earnings at the beginning of the year and other related items in the financial statements shall be adjusted, while the data in the comparable period shall not. For the influence brought up by the changes in accounting policies, please refer to Note V “Important accounting policies and accounting estimates”; 44. “ Adjustments to the financial statements at the beginning of the first execution year of the new revenue standards initially implemented” and “Retroactive adjustments of comparative data in the early stage by the new revenue standards initially implemented” in this annual report.

According to the new standards governing lease, for contracts coming into force before the date of initial execution of the new standards, the Company chooses not to reassess whether they are lease contracts or contracts containing lease.

(1) The Company as the lessee

The Company chose to adjust only the accumulated impact of lease contracts that have not been completed as of January 1, 2021. According to the amount of the first execution ’s accumulated impact, the amount of retained earnings at the beginning of the period when the execution of new standards were initially carried out (namely January 1, 2021) and other related items in the financial statements shall be adjusted, while the data in the comparable period shall not.

According to the new standards governing lease, the Company will not distinguish between finance leases and operating leases. For all leases (except the short-term leases and leases of low-value assets with the simplified treatment), the Company will recognize right-of-use assets and lease liabilities.

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For operating leases prior to the date of initial execution, the Company measures the lease liability based on the present value of the remaining lease payments discounted at the incremental borrowing rate on the date of initial execution, and the right-of-use assets of each lease is determined based on the equal amount of lease liability and the prepaid rent after necessary adjustment.

The Company conducts impairment test on right-of-use assets and performs corresponding accounting treatment in accordance with relevant regulations on asset impairment.

The Company has adopted the following simplified treatments for operating leases prior to the date of initial execution:

1) When measuring lease liabilities, the same discount rate can be used for leases with similar characteristics; the measurement of right-of-use assets doesn’t have to take the initial direct costs into consideration;

2) Should there be a lease renewal option or a lease termination option, the Company determines the lease term based on the actual exercise of the option prior to the date of initial execution and other latest information;

3) As an alternative to the impairment test for right-of-use assets, the Company assesses whether the contract containing the lease was in deficit before the date of initial execution, and adjusts the right-of-use assets based on the amount of the loss provision included in the balance sheet before the date of initial execution;

4) The lease changes before the date of initial execution will not be adjusted retrospectively. The accounting treatment will be carried out based on the final arrangements of lease changes and the new lease standards .

(2)The Company as the lessor

The Company does not need any transitional adjustment for the leases as the lessor, and will carry out accounting treatment in accordance with the new lease standards from the date of initial execution.

2. Changes in accounting estimates

None.

3. Corrections of previous accounting errors

None.

Section VII. Explanation of the changes in the scope of the consolidated statement compared

with the financial statements of the previous year

√ Applicable □ Not applicable

√Applicable □Not applicable
Full name of subsidiary	Ratio of shareholding (%)	Reasons for changes
1. Lu’an Yazhong Real Estate Information Consulting	100.00	Acquired
Co., Ltd.
2.Lu’an Zhongke Real Estate Information Consulting	100.00	Acquired
Co., Ltd.
3. Wenling Offcn Information Consulting Co., Ltd.	100.00	Newly established
4. Anshan Tiedong Offcn Education Training School	100.00	Newly established
Co., Ltd.
5. Diqing Offcn Training School Co., Ltd.	100.00	Newly established
6. Dali Offcn Education Training School Co., Ltd.	100.00	Newly established
7. Harbin Nangang Offcn Education Training School	100.00	Newly established
Co., Ltd.
8. Nujiang Offcn Training School Co., Ltd.	100.00	Newly established

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9. Weixi Offcn Education Training School Co., Ltd.	100.00	Newly established
10. Beijing Offcn Century Education Technology	100.00	Newly established
Co., Ltd.
11. Beijing Offcn Future Education Technology Co.,	49.00	Transferred
Ltd.

Section VIII . Appointment and dismissal of the CPA firm

CPA firm appointed at present

Name of the domestic CPA firm	Baker Tilly China Certified Public Accountants LLP
Remuneration of domestic CPA firm (MillionYuan)	1.80
Consecutive years of the audit service of domestic CPA firm	4 years
Name of the CPAs in domestic CPA firm	Zhou Baiming, Li Qiang
Consecutive years of audit service of the CPAs of domestic CPA firm	4 consecutive years for Zhou Baiming and 1 year for Li Qiang

Whether to reappoint another CPA firm in the current period

Yes √No

Appointment of internal control auditing CPA firms, financial consultants or sponsors

□ Applicable √Not applicable

Section IX. Facing delisting after the disclosure of the annual report

□ Applicable √Not applicable

Section X. Bankruptcy and reorganization related matters

□ Applicable √Not applicable

There is no such situation of bankruptcy and reorganization of the Company during the reporting period.

Section XI. Major litigation and arbitration matters

□ Applicable √Not applicable

There is no major litigation or major arbitration during the reporting period.

During the reporting period, other litigation and arbitration matters of the Company and its subsidiaries are as follows:

During the reporting period, the amount of litigation involved in closed cases was RMB 17.4338 million yuan, and the actual amount of judgments in effective legal documents was approximately RMB 1.086 million yuan. The results of the litigation cases had no significant impact on the Company's operations;
At the end of the reporting period, the amount of litigation involved in unsettled cases was RMB 14.8006 million yuan, and the amount of litigation involved in these pending cases accounted for 0.78% of the unaudited net assets

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attributable to shareholders of the listed Company in 2021, which had no significant impact on the Company's operations.

Section XII. Penalties and rectifications

□ Applicable √Not applicable

There is no penalty or rectification of the Company during the reporting period

Section XIII. Integrity of the Company and its controlling shareholders and actual controllers:

□ Applicable √Not applicable

Section XIV. Significant related-party transactions

1. Related-party transactions relevant to daily operations

√Applicable □Not applicable

Related party	Ji'an Jingkai Lixiangxue Financial Information Service Co., Ltd. / Shanghai Beiding Network Technology Co., Ltd.	Beijing Chuangsheng Construction Decoration Engineering Co., Ltd.	Total
Relationship	Enterprise actual-controlled by the director of the Company	Enterprise actual-controlled by the director of the Company
Type of related-party transaction	Purchasing products and goods from the related party	Purchasing products and goods from the related party
Content of related-party transaction	Commission fee	Decoration fee
Pricing principle for related-party transaction	Fair market pricing	Fair market pricing	--
Price of related-party transaction	Fair market pricing	Fair market price	--
Amount of related-party transaction (RMB 10 thousand yuan)	18,314.42	3,597.24	21,911.66
Proportion of the amount of similar transactions	4.34%	2.63%	--
Approved transaction limit (RMB 10 thousand yuan)	0	0	0
Whether exceeding the approved transaction limit	Yes	Yes	--
Settlement method of related-party transaction	Wire transfer	Wire transfer	--
Available market price for similar transactions	None	None	--
Date of disclosure			--
Index of disclosure	CNINFO (http://www.cninfo.com.cn) Announcement on the Estimated Limit of Daily Related-party Transactions in		--

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	the Year of 2022 (No. 2022-035)
Details of large sales returns	N/A
Actual performance during the reporting period of the total amount of the daily related-party transactions estimated by categories in this period (if any)	N/A
Reasons for large differences between transaction prices and market reference prices (if applicable)	N/A

2. Related-party transactions arising from acquisition and sale of assets or equity

□ Applicable √Not applicable

There is no related-party transaction arising from acquisition and sale of assets or equity of the Company during the reporting period.

3. Related party transactions of joint foreign investments

□ Applicable √Not applicable

There is no related-party transaction of joint foreign investments of the Company during the reporting period.

4. Related credit and debt transactions

□ Applicable √Not applicable

There is no related credit and debt transaction of the Company during the reporting period.

5. Transactions with related financial companies

□ Applicable √Not applicable

There is no deposit, loan, credit or other financial business between the Company and its related financial companies or other related parties.

6. Transactions between the financial company controlled by the Company and related parties

□ Applicable √Not applicable

There is no deposit, loan, credit or other financial business between the financial company controlled by the Company and related parties.

7. Other significant related-party transactions

□ Applicable √Not applicable

There is no other significant related-party transaction in the Company during the reporting period.

Section XV. Major contracts and their performance

1. Trusteeship, contracting and leasing matters

(1) Trusteeship

√Applicable □ Not applicable

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Details of trusteeship

On September 20, 2018, Offcn Ltd. and Li Yongxin signed Agreement on Transfer of Organizer ’s Rights of Non-enterprise Private Schools Affiliated to Beijing Offcn Education Technology Co., Ltd.. All 100% rights of organizers as of September 20, 2018 were to be transferred to Li Yongxin. On the same day, Li Yongxin and Offcn Ltd. signed the Trusteeship Agreement of Private Non-enterprise Schools stipulating that Li Yongxin would entrust the transferred private non-enterprise schools to Offcn Ltd. for management. The period of trusteeship started from the date when Li Yongxin paid all the transfer price to the date when the private non-enterprise schools’ 100% rights of organizers were transferred to the unrelated third party or canceled (Note: within 12 months after the revised Implementation Regulations was officially promulgated and the relevant local education authorities passed the supporting regulations in accordance with the revised Implementation Regulations , Li Yongxin transferred 100% of the owner’s rights to the unrelated third party or canceled them.)

Projects with trusteeship that profits or losses reached more than 10% of the total profits of the Company of the reporting period

□ Applicable √Not applicable

There was no project with trusteeship that profit or loss reached more than 10% of the total profits of the Company during the reporting period.

(2) Contracting

□ Applicable √Not applicable

There was no contracting of the Company during the reporting period.

(3) Leasing

□ Applicable √Not applicable

There was no leasing of the Company during the reporting period.

2. Major guarantee

□ Applicable √Not applicable

There was no major guarantee of the Company during the reporting period.

3. Particulars about entrusted cash assets

(1) Particulars about entrusted financial management

√Applicable □ Not applicable

Particulars about entrusted financial management during the reporting period

Unit: RMB 10 thousands

Type	Source of entrusted financing	Amount of entrusted financing	Undue balance	Overdue amount yet to be recovered	Impairment accrued of the overdue financial

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Bank financial product	Self-owned fund	126,155	34,327.98
Trust financial products	Self-owned fund	27,000	0
Others	Self-owned fund	999.9	0
Total		154,154.9	34,327.98

Particulars of high-risk entrusted financial management with a large single amount, low security or poor liquidity

□ Applicable √ Not applicable

It is estimated that the principal of the entrusted financing cannot be recovered or there are other cases that may cause impairments to the entrusted financing.

□ Applicable √Not applicable

（ 2 ） Entrusted loans

□ Applicable √Not applicable

There is no entrusted loan of the Company during the reporting period.

4. Other significant contracts

√Applicable □ Not applicable

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Section XVI. Other significant events

√Applicable □ Not applicable

1. The progress of the Company’s non-public issuance of A Shares:

The Company held the meetings of Company’s board of directors and supervisory committee, and the third extraordinary general meeting of shareholders in 2020 on November 23, 2020 and December 9, 2020, reviewed and approved the Proposal on the Company’ s Compliance with the Conditions for Non-public Issuance of A Shares , Proposal on the Company’s Plan of Non-Public Issuance of A Shares, and Proposal on the Company's Proposal of Non-Public Issuance of A Shares and other proposals related to this non-public issuance.

On December 30, 2020, the Company announced the Announcement on the Acceptance of Applications for Non-public Issuance of Shares by the China Securities Regulatory Commission (Announcement No.: 2020-052).

On January 8, 2021, the Company announced the Notice on Receiving a Feedback from the China Securities Regulatory Commission's Administrative License Project Review (Announcement Number: 2021-002).

On January 27, 2021, the Company announced the Report on the Reply to the Feedback Notice from the China Securities Regulatory Commission Administrative Licensing Project Review and other documents. On the same day, the Company also announced the adjustments to the non-public issuance plan including the Revised Proposal for Non-public Issuance of A Shares reviewed and approved at the 17th meeting of the Fifth Board of Directors and the 14th Meeting of the Fifth Supervisory Committee.

On May 18, 2021, the Company issued the Announcement on the Revised Reply to the First Feedback Notice from the China Securities Regulatory Commission Administrative Licensing Project Review and the Announcement on Receiving the Second Feedback from the China Securities Regulatory Commission's Administrative Licensing Project Review.

On May 29, 2021, the Company issued the Report on the Reply to the Second Feedback Notice from the China Securities Regulatory Commission Administrative Licensing Project Review and other documents. On the same day, the Company also issued the Adjustments to the non-public issuance plan including the Second Revised Proposal for Non-public Issuance of A Shares reviewed and approved at the 19th meeting of the Fifth Board of Directors and the 16th meeting of the Fifth Supervisory Committee.

On June 5, 2021, the Company issued the Announcement on the Revised Reply to the Second Feedback Notice from the China Securities Regulatory Commission Administrative Licensing Project Review and other documents. On June 16, 2021, the Company ’s non-public issuance were reviewed and approved by the Issuance Review Committee of the China Securities Regulatory Commission.

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On August 24, 2021, the Company issued the Announcement on Notice of the Suspension of the China Securities Regulatory Commission Administrative Licensing Application Review . Because the law firm hired for this issuance was filed and put under investigation by the China Securities Regulatory Commission for its services for other companies, the China Securities Regulatory Commission suspended the review of the Company's application for administrative license for this non-public issuance of shares.

On December 7, 2021, the Company issued the Announcement on Termination of the Non-public Issuance of Shares and Withdrawal of Application Documents. Considering the capital market environment, the development of fundraising projects, the actual situation of the Company, and the timing of financing, after prudent analysis and constant discussions with intermediaries, the Company decided to terminate the non-public issuance of A shares and withdraw the application documents.

2. The progress of the investigation launched by the China Securities Regulatory Commission into the Company:

On December 15, 2021, the Company received the Notice of Filing (No. SR Filing 0232021010) from the CSRC. According to the Securities Law of the People's Republic of China, Law of the People’s Republic of China on Administrative Punishment and other laws and regulations, the Company is suspected of failing to disclose related party transaction information and violating the laws and regulations of information disclosure. The CSRC decided to file a case against the Company.

On January 15, 2022, the Company issued the Announcement on the Progress of the Investigation and Risk Warning (No. 2022-006).

On February 15, 2022, the Company issued the Announcement on the Progress of the Investigation and Risk Warning (No. 2022-019).

On March 15, 2022, the Company issued the Announcement on the Progress of the Investigation and Risk Warning (No. 2022-022).

On April 24, 2022, the Company and the relevant parties received the Prior Notice of Administrative Penalty . The Anhui Securities Regulatory Bureau of the CSRC decided to give a warning to and impose a fine on the Company and the relevant parties. Specific information is stated in the announcement (No. 2022-031) disclosed on CNINFO (www.cninfo.com.cn) and other designated media.

On April 27, 2022, the Company and the relevant parties received the official Decision of Administrative Penalty from the Anhui Securities Regulatory Bureau, which determines Offcn Edu, its subsidiaries Beijing Offcn Education Technology Co., Ltd. and Liaoning Zhongcheng Real Estate Development Co.,Ltd. constitute a

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related-party relationship with Shaanxi Guancheng Industrial Co., Ltd., Beijing Chuangsheng Construction Decoration Engineering Co., Ltd., Shanghai Beiding Network Technology Co., Ltd., Ji'an Jingkai Lixiangxue Financial Information Service Co., Ltd. and Liaoning Hanhui Industrial Co., Ltd.. The total amount involved in related transactions was RMB 1232.395 million yuan, including RMB 196.335 million yuan in year 2019 and RMB 1036.060 million yuan in year 2020, which account for 6.65% and 30.19% of the net assets of Offcn Edu in the latest period respectively. The Company did not disclose the above-mentioned information in accordance with relevant laws and regulations and there was a material omission of the Company ’ s information disclosure. A warning was given to and a fine was imposed on the Company and the relevant persons responsible for the situation, and corresponding rectification is required. Specific information is stated in the announcement (No. 2022-032) disclosed by the Company on CNINFO (www.cninfo.com.cn) and other designated media for information disclosure.

Type of related -party transa ction	Related party	Content of related-party transaction	Amount of related-party transactions in year 2019 (RMB)	Amount of related-party transactions in year 2020(RMB)	Total(RMB)
Accepti ng the entrust ment of related party for decorat ion	Beijing Chuangsheng Construction Decoration Engineering Co., Ltd.	Decoration fee	161,747,000.00	242,000,000.00	403,747,000.00
Accepti ng the transfer of assets from related party	Shaanxi Guancheng Industrial Co., Ltd.	Asset acquisition	0.00	383,060,000.00	383,060,000.00
Accepti ng the transfer of assets from related party	Liaoning Hanhui Industrial Co., Ltd.	Asset acquisition	0.00	200,000,000.00	200,000,000.00

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Purcha sing product s and goods from the related party	Ji'an Jingkai Lixiangxue Financial Information Service Co., Ltd. / Shanghai Beiding Network Technology Co., Ltd.	Commission fee	34,588,038.03	210,728,611.86	183,144,220.00	428,460,869.89
Total			196,335,038.03	1,035,788,611.86	183,144,220.00	1,415,267,869.89

Section XVII. Significant events of the Company’s subsidiaries

√Applicable □ Not applicable

1. The case of transferring part of the wholly-owned subsidiary’s equity and cooperative development

On December 2, 2020, the wholly-owned subsidiary of the Company, Beijing Offcn Future Education Technology Co., Ltd. (hereinafter referred to as the target company), won the bid for the first-level development project - CP00-1804-0002 residential land and CP00-1804-0012 public construction land in Qiliqu Nanbei Village, Shahe Town, Changping District, Beijing, and the Company provided a loan of RMB 3.098 billion yuan to the target company to pay for the price, deed tax and other expenses of the above-mentioned lands.

On September 26, 2021, the Company held the 22nd Meeting of the Fifth Board of Directors which reviewed and approved the Proposal on Transferring Part of the Wholly-owned Subsidiary ’ s Equity and Cooperative Development . The Board of Directors agreed to transfer 51% equity of the Company’s wholly-owned subsidiary, namely Beijing Offcn Future Education Technology Co., Ltd., to Beijing Shangheng Jirui Commercial Operation and Management Co., Ltd. (hereinafter referred to as Longhu Party). After friendly negotiation between the two parties, based on the target company’s paid-in registered capital, the Company priced the transfer of the target company’s 51% equity at RMB 51 million yuan. At the same time, Longhu Party invested RMB1.379 billion yuan in the target company as shareholder loans, all of which were used to repay the target company’s borrowing from the Company. For specific information of this matter, please refer to the Company’s Announcement on the Transfer of Part of the Wholly-owned Subsidiary’s Equity and Cooperative Development (Announcement No.: 2021-061) released on CNINFO (www.cninfo.com), September 27, 2021.

According to the customized development agreement and supplementary agreement signed between the target company and the Company, the Company’s RMB1.618 billion yuan’s worth of loan to the target company has been

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converted into the advance payment for the construction of CP00-1804-0012 public construction land. The target company will construct an online technology R&D center, an Online-Merge-Offline education demonstration center, an integrated training center for R&D and teaching personnel, a vertical integrated fast-response command center for nationwide market, and an innovative education headquarter in accordance with the Company’s design and planning. At present, the target company has paid off all its loans to the Company.

2. The cooperation with Liaoning Hanhui Industrial Co., Ltd.

On January 13, 2020, the wholly-owned subsidiary of the Company, Beijing Offcn and Liaoning Hanhui Industrial Co., Ltd. (hereinafter referred to as Liaoning Hanhui) signed the Future Learning City Project Cooperative Agreement and the two parties decided to cooperate in the development of the future learning city project. On January 17, 2020, according to the agreement, the Company paid RMB 200 million yuan to Liaoning Hanhui as a security deposit. Liaoning Hanhui should complete the project construction and obtain the corresponding property rights before July 31, 2021. After the completion of the construction, the Company will transfer 100% equity of Liaoning Hanhui based on its assessed net assets, and the shareholders of Liaoning Hanhui should cooperate with the Company to transfer their equity of Liaoning Hanhui to Offcn EDU or its designated subsidiary. On March 10, 2021, the two parties signed the Supplementary Agreement , which changed the stipulation from “ the project construction should be completed and property ownership certificate should be obtained before July 31, 2021” to “ the project construction should be completed and pass the acceptance test, and property ownership certificate should be obtained before December 31, 2021.

Affected by the pandemic and other factors, Liaoning Hanhui couldn’t complete the construction and obtain the property ownership certificate before December 31, 2021. In view of the above situation, and considering that this cooperation has lasted for a long time, and the market environment has changed a lot compared with that at the beginning of the cooperation, after friendly negotiation between the Company and Liaoning Hanhui, the two parties signed the Termination Agreement of the Offcn Future Learning City Project Cooperative Agreement Between Beijing Offcn Education Technology Co., Ltd and Liaoning Hanhui Industrial Co., Ltd. on December 9, 2021. Liaoning Hanhui shall return the deposit RMB200 million yuan paid by the Company within 10 days after the termination of the agreement takes effect and pay the liquidated damages at the bank loan interest rate of 4.75% in the same period. Both parties confirm that there are no other disputes. Up to now, Liaoning Hanhui has returned the above-mentioned deposit and paid liquidated damages to the Company. The above matters have been reviewed and approved by the Company’s general manager's office meeting.

3. The progress in the acquisition of 100% equity of Lu’an Yazhong Real Estate Information Consulting Co., Ltd. and Lu’an Zhongke Real Estate Information Consulting Co., Ltd. (hereinafter referred to as the "target companies")

The purpose of the acquisitions is to take advantage of the property assets from the target companies to build a large-scale regional learning base that can be put into use in a short period of time. And with its excellent geographical location and the convenience brought by the high-speed rail, the learning base can benefit other areas of Anhui Province and the adjacent central China region, thus quickly relieving the problem of insufficient supply of supporting hardware for multi-category teaching in the central region and steadily promoting the implementation

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of the Company’s strategic plan. Based on the assessed value of the real estate by Beijing Zhuoxindahua Appraisal Co., Ltd. on October 31, 2020 (the base date), the Company negotiated and determined that the total price of the equity transfer transaction of the target companies is RMB 561.2833 million yuan, including RMB 72.1516 million yuan as the 100% equity transfer price of Lu’an Yazhong and RMB 489.1317 million yuan as the 100% equity transfer price of Lu ’ an Zhongke. The above-mentioned matters have been reviewed and approved at the 16th meeting of the fifth Board of Directors of the Company. For details of this matter, please refer to the Announcement on Acquisition of the Equity From Lu’an Yaxia Runnan's Wholly-owned Subsidiary (No. 2020-048) published by the Company on CNINFO (www.cninfo.com.cn). on December 10, 2020. In April 2021, the target companies obtained the real estate certificate of the property assets, and in January 2022, the target companies completed the equity transfer of equity and the change of legal representative and senior executives.

Chapter 7 Share Changes and Shareholders

Section I. Changes in Shares

1. Changes in Shares

Unit: share(s)

	Before Change	Before Change	Increase or Decrease (+ or -)	Increase or Decrease (+ or -)	Increase or Decrease (+ or -)	Increase or Decrease (+ or -)	Increase or Decrease (+ or -)	After Change	After Change
	Number of shares	Proportion	New shares issued	Bonus shares	Conversion of equity reserves into share capital	Other	Subtotal	Number of shares	Proportion
1. Shares with trading restrictions	5,419,759,990	87.88%				-854,983,969	-854,983,96 9	4,564,776,02 1	74.01%
(1) Shares held by state
(2) Shares held by state-owned legal person
(3) Other shares held by domestic capital	5,419,759,990	87.88%				-854,983,969	-854,983,96 9	4,564,776,02 1	74.01%
Of which: shares held by domestic legal person	534,706,341	8.67%				-534,706,341	-534,706,34 1	0	0.00%
Shares held by domestic natural person	4,885,053,649	79.21%				-320,277,628	-320,277,62 8	4,564,776,02 1	74.01%
(4) Shares held by overseas capital
Of which: shares held by overseas legal person

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Offcn Education Technology Co., Ltd. 2021 Annual Report

Shares held by overseas natural person
2. Shares without trading restrictions	747,639,399	12.12%	854,983,969	854,983,969	1,602,623,36 8	25.99%
(1) RMB ordinary shares	747,639,399	12.12%	854,983,969	854,983,969	1,602,623,36 8	25.99%
(2) Domestic - listed shares for oversea investors
(3) Foreign - listed shares for overseas investors
(4) Other
3. Total number of shares	6,167,399,389	100.00%	0	0	6,167,399,38 9	100.00%

Reasons for changes in shares

□Applicable √ Not applicable

Approval of changes in shares

□Applicable √Not applicable

Transfer of share changes

□Applicable √Not applicable

The impact of share changes on financial indicators such as basic earnings per share and diluted earnings per share, net assets per share attributable to the Company’s ordinary shareholders, etc. in the most recent year and the most recent period

□Applicable √Not applicable

Other content that the Company deems necessary or required by the securities regulatory agency to disclose

□Applicable √Not applicable

2. Changes in shares with sales restrictions

√Applicable □Not applicable

Unit: share(s)

Name of shareholder	Number of shares with sales restrictions at the beginning of the period	Number of shares with sales restrictions increased in the period	Number of shares with sales restrictions released in the period	Number of shares with sales restrictions at the end of the period	Reasons for sales restrictions	Date of releasing restrictions on sales

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Offcn Education Technology Co., Ltd. 2021 Annual Report

Li Yongxin	1,131,415,121		345,000	1,131,070,121	Key executive’s lock-up shares	According to the relevant regulations of key executive’s lock-up shares
Wang Zhendong	962,471,418		721,853,563	240,617,855	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase; Key executive’s lock-up shares	February 1, 2021
Zhang Yongsheng	48,123,570		12,030,893	36,092,677	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase; Key executive’s lock-up shares	February 1, 2021
Zhang Zhi’an	48,123,570		48,123,570	0	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase	February 1, 2021
Yang Shaofeng	48,123,570		48,123,570	0	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase	February 1, 2021
Guo Shihong	48,123,570		12,030,893	36,092,677	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase; Key executive’s lock-up shares	February 1, 2021
Liu Bin	48,123,570		48,123,570	0	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase	February 1, 2021
Beijing Aerospace Industry Investment Fund (Limited Partnership)	267,353,171		267,353,171	0	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase	February 1, 2021
Beijing Guangyin Venture Capital Center (Limited Partnership)	178,235,447		178,235,447	0	Releasing sales restriction on shares from major assets replacement and shares issued for assets purchase	February 1, 2021
Total	2,780,093,007	0	1,336,219,67 7	1,443,873,330	—	—

Offcn Education Technology Co., Ltd. 2021 Annual Report

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Section II. Issuance and listing of securities

Issuance of securities (excluding preferred shares) during the reporting period
□Applicable √Not applicable
Explanation of changes in the Company’s total shares and shareholder structure, and changes in the Company’s asset and liability structure
□Applicable √Not applicable
Existing internal employee shares
□Applicable √Not applicable

Section III. Shareholders and actual controllers

1. Numbers of Shareholders and Shareholdings

Unit: Share(s)

Total number of shareholders with ordinary shares at the end of the reporting period	158,831	Total number of shareholders with ordinary shares at the end of the previous month before the disclosure date of the annual report	Total number of shareholders with ordinary shares at the end of the previous month before the disclosure date of the annual report	153,843	Total number of preferred shareholders with voting rights restored at the end of the reporting period (if any) (See Note 8)	0	Total number of preferred shareholders whose voting rights have been restored at the end of the previous month before the disclosure date of the annual report (if any) (See Note 8)	Total number of preferred shareholders whose voting rights have been restored at the end of the previous month before the disclosure date of the annual report (if any) (See Note 8)
Shareholders with over 5% shares or top 10 shareholders
Name of Shareholder	Nature of shareholder	Sharehol ding Percenta ge (%)	Total shares held at the end of the reporting period	Increase/decr ease of shares during the reporting period	Number of shares held with sales restrictions	Number of shares held without sales restrictions	Pledged, marked or Frozen
							Status of shares	Number of shares
Lu Zhongfang	Domestic natural person	41.36%	2,550,549,260	0	2,550,549,260	0	Pledged	770,000,000
Li Yongxin	Domestic natural Person	18.35%	1,131,415,121	0	1,131,070,121	345,000	Pledged	476,150,000
Wang Zhendong	Domestic natural person	13.83%	852,885,418	0	721,853,563	131,031,855	Pledged	431,013,878
Beijing Aerospace Industry Investment Fund (Limited Partnership)	Domestic non-state- owned legal person	4.24%	261,280,477	0	0	261,280,477

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Beijing Kerui Technology Innovation Investment Center (Limited Partnership)	Domestic non-state-owned legal person	1.44%	89,117,723	0	89,117,723	0
Beijing Offcn Future Information Consulting Center (Limited Partnership)	Domestic non-state-owned legal person	1.30%	80,000,000	0	0	80,000,000
Zhou Xiayun	Domestic natural person	1.28%	78,848,640	0	0	78,848,640	Pledged	64,000,000
Zhou Hui	Domestic natural person	1.17%	72,277,920	0	0	72,277,920	Pledged	25,480,000
Beijing Guangyin Venture Capital Center (Limited Partnership)	Domestic non-state-owned legal person	1.04%	64,355,896	0	0	64,355,896
Zhou Li	Domestic natural person	0.78%	48,185,280	0	0	48,185,280
Strategic investors or ordinary legal person become the top 10 shareholders by the placement of new shares (if any) (See Note 3)		No
Description of the above-mentioned shareholders’ relationship or concerted actions		The Company’s controlling shareholder and actual controller Lu Zhongfang and Li Yongxin are in a parent-child relationship. Lu Zhongfang, Li Yongxin, and Beijing Offcn Future Information Consulting Center (Limited Partnership) constitute persons acting in concert. Zhou Xiayun and Zhou Hui have a father-son relationship. Zhou Xiayun and Zhou Li have a father-daughter relationship. It is unknown whether there is an associated relationship among the above-mentioned other shareholders, and whether the above-mentioned shareholders belong to the parties acting in concert as stipulated in the_Administrative Measures on Disclosure of Information Disclosure of_ Shareholding Changes in Listed Companies.
Explanation of the above-mentioned shareholders’entrusting/entrusted voting rights and waiver of voting rights		N/A
Explanation of for the existence of a special repurchase account among the top 10 shareholders (if any) (See Note 10)		N/A
Description of top 10 shareholders without sales restrictions

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Name of Shareholder	Number of shares without sales restrictions at the end of the reporting period	Type	Type
		Type	Quantities
Beijing Aerospace Industry Investment Fund (Limited Partnership)	261,280,477	RMB ordinary shares	261,280,477
Wang Zhendong	131,031,855	RMB ordinary shares	131,031,855
Beijing Offcn Future Information Consulting Center (Limited Partnership)	80,000,000	RMB ordinary shares	80,000,000
Zhou Xiayun	78,848,640	RMB ordinary shares	78,848,640
Zhou Hui	72,277,920	RMB ordinary shares	72,277,920
Beijing Guangyin Venture Capital Center (Limited Partnership)	64,355,896	RMB ordinary shares	64,355,896
Zhou Li	48,185,280	RMB ordinary shares	48,185,280
Hong Kong Securities Clearing Co.,Ltd.	25,004,586	RMB ordinary shares	25,004,586
Yang Shaofeng	24,062,680	RMB ordinary shares	24,062,680
Sequoia Jincheng (Xiamen) Equity Investment Partnership (Limited Partnership)	18,800,000	RMB ordinary shares	18,800,000
Description of the relationship or concerted actions among the top 10 shareholders without sales restrictions, and between the top 10 shareholders without sales restrictions and the top 10 shareholders	The Company’s controlling shareholder and actual controller Lu Zhongfang and Li Yongxin are in a parent-child relationship. Lu Zhongfang, Li Yongxin, and Beijing Offcn Future Information Consulting Center (Limited Partnership) constitute persons acting in concert. Zhou Xiayun and Zhou Hui have a father-son relationship. Zhou Xiayun and Zhou Li have a father-daughter relationship. It is unknown whether there is an associated relationship among the above-mentioned other shareholders, and whether the above-mentioned shareholders belong to the parties acting in concert as stipulated in the_Administrative Measures on Disclosure of Information Disclosure of_ Shareholding Changes in Listed Companies.
Description of the top 10 ordinary shareholders participating in the margin trading or short selling business (if any)	N/A

Whether the Company’s top 10 ordinary shareholders and top 10 ordinary shareholders without sales restrictions

conducted agreed repurchase transactions during the reporting period

□Yes √No

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The Company’s top 10 ordinary shareholders and top 10 ordinary shareholders without sales restrictions didn’t conduct agreed repurchase transactions during the reporting period

2. The controlling shareholders of the Company

Nature of controlling shareholders: natural person holding

Type of controlling shareholders: natural person

Name of controlling shareholder	Nationality	Whether obtained any permanent residency abroad
Lu Zhongfang	China	No
Li Yongxin	China	No
Major occupations and jobs	Li Yongxin is the Chairman of the Board of the Company.
Particulars about controlling or holding shares of other companies listed at home and/or abroad during the reporting period	N/A

Change of controlling shareholder during the reporting period

□Applicable √Not applicable

Controlling shareholders of the Company did not change during the reporting period.

3. The actual controllers of the Company and the person acting in concert

Nature of actual controllers: domestic natural person

Type of actual controllers: natural person

Name of actual controller	Relationship with the actual controller	Nationality	Whether obtained any permanent residency abroad
Lu Zhongfang	herself	China	No
Li Yongxin	himself	China	No
Beijing Offcn Future Information Consulting Center (Limited partnership)	Acting in concert （including agreements, relatives, or under common control）	China	No
Major occupations and jobs	Li Yongxin, the founder and actual controller of the Company, is the current Chairman of the Board of the Company.
Particulars about controlling shares of other companies listed at home and/or abroad in past 10 years	N/A

Change of actual controller during the reporting period

□Applicable √Not applicable

The actual controllers of the Company did not change during the reporting period.

Offcn Education Technology Co., Ltd. 2021 Annual Report

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Block diagram of the property rights and control relationship between the Company and the actual controllers

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The actual controller controls the Company through trust or other asset management methods

□Applicable √Not applicable
The Company’s controlling shareholder or the largest shareholder and its concert parties have pledged 80% of the number of shares held by them
□Applicable √Not applicable
Other legal person shareholders holding more than 10% of the shares
□Applicable √Not applicable
Controlling shareholders, actual controllers, restructuring parties and other committed entities with restricted shareholding reductions
□Applicable √Not applicable

Section IV. Details of implementation of share repurchase during the reporting period

Implementation progress of share repurchase

□Applicable √Not applicable

Implementation progress of reducing repurchased shares by means of centralized bidding

□Applicable √Not applicable

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Chapter 8 Preferred Shares

□Applicable √Not applicable

There were no preferred shares during the reporting period.

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Chapter 9 Corporate Bonds

□Applicable √Not applicable

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Chapter 10 Financial Statements

Section I. AUDITOR’S REPORT

Baker Tilly China [2022] No. 15311

To the Shareholders of Offcn Education Technology Co.,Ltd.

I. Opinion

“ ” We have audited the accompanying financial statements of Offcn Education Technology Co.,Ltd. ( Offcn Education or “the Company”), which comprise the consolidated and parent's balance sheets as at 31 December 2021, and the 2021 consolidated and parent's income statements, the consolidated and parent's statement of cash flows and the consolidated and parent's statements of changes in owners' equity for the year then ended, and the notes to the financial statements.

In our opinion, the financial statements of Offcn Education present fairly, in all material respects, the consolidated and parent's financial position as at 31 December 2021, and the 2021 consolidated and parent's result of operations and cash flows for the year ended in accordance with the requirements of the Accounting Standards for Business Enterprises.

II. Basis of opinion

We conducted our audit in accordance with China Standards on Auditing (“CAS”). Our responsibilities under those standards are further described in the Auditor ’ s responsibilities section of our report. We are independent of Offcn Education 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.

Key Audit Matters How our audit addressed the Key Audit Matter recognition of revenue For example, in the notes to the financial statements In response to the key audit matter, we performed " Ⅲ .Notes on important accounting policies and procedures as follows:

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accounting estimates (32)” and VI.Notes to important items in consolidated finacial statements (35)”,education and training income accounted for 99.26% of the company’s operating income in 2021.

The company's revenue mainly includes ordinary class revenue and agreement class revenue. When the ordinary class face-to-face training service is completed, all the training fees received in advance are recognized as revenue. Revenue from online training in ordinary classes is recognized on a straight-line basis during the validity period of the service provided. Non-refundable portion of revenue from agreement class is recognized as revenue upon completion of training services; According to the agreement, the refund part is recognized as revenue when the non-refundable conditions are met.

In view of the significant amount of education and training revenue, which is the main source of company's profits. And the frequent occurrence of transactions, the risk of misstatement is high. Therefore, we identified the company's education and training revenue as a key audit matter.

1.Understood and tested internal controls relating to recognition of revenue and evaluated the effectiveness of related internal controls. 2.Understood the revenue recognition policies of comparable companies in the same industry, discussed the characteristics of training business with management, checked business contracts, identify contract terms and conditions related to education and training services, and evaluated the appropriateness of revenue recognition policies.

3.Implemented substantive analysis procedures for revenue and gross profit margin during the reporting period, evaluated the overall rationality of revenue.

4.Selected samples of the revenue confirmed during the reporting period, checked the receipts, bank flow, contracts, examination announcement and refunds, and evaluated whether the relevant revenue confirmation is in line with the company's revenue recognition accounting policy. 5.For the education and training revenue items confirmed before and after the balance sheet date, selected samples, checked the supporting documents for revenue recognition, and evaluated whether they are recorded in the correct accounting period.

Ⅳ .Other Information

Management of the Company is responsible for the other information.The other information comprises all of the information included in 2021 annual report of the Company 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.

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Ⅴ . Responsibilities of Management and Those Charged with Governance for the Financial Statements

The management is responsible for the preparation of the financial statements that give a true and fair view in accordance with Accounting Standards for Business Enterprises and designing, implementing and maintaining internal control as the management determines is necessary to enable the preparation of the 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 intend to liquidate Offcn Education or to cease operations or have 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 CAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are 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 CAS, we exercise professional judgement and maintain professional skepticism 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. However, our purpose is not to express 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

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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.

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

6) Acquire sufficient and appropriate audit evidence based on the financial information of the Company or business activities to express its audit opinion on the consolidated financial statements. We are responsible for the direction, supervision, and execution of the group audit and assume full responsibility for the 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 those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

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

Beijing, China 28 April,2022

Accountant: Zhou Baiming (Engagement partner) Chinese Certified Public Li Qiang

Chinese Certified Public

Accountant:

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Section II. Financial Statements

The unit of the statement in the financial notes: RMB

1. Consolidated balance sheet

Prepared by: Offcn Education Technology Co., Ltd.

December 31, 2021

Unit: RMB

Items	December 31, 2021	December 31, 2020
Current assets:
Monetary funds	1,970,361,272.64	5,950,395,089.12
Settlement reserve
Lendings
Transactional financial assets	346,726,621.74	983,205,858.25
Derivative financial assets
Notes receivable
Accounts receivable	40,374,842.27	21,493,637.66
Receivables financing
Prepayments	1,438,350.00	2,204,120.00
Premium receivable
Accounts receivable reinsurance
Reserve for reinsurance Receivable contracts
Other receivables	219,501,061.83	304,318,966.20
Inc：Interest receivables
Dividends receivables
Buying back the sale of financial assets
Inventory
Contract assets
Assets held-for-sale
Non-current assets due within one year		1,985,873,462.75
Other current assets	36,959,129.80	175,179,650.61

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Total current assets	2,615,361,278.28	9,422,670,784.59
Non-current assets:
Loans and advances
Debt investment	7,058,993.55
Other debt investment
Long-term receivables
Long-term equity investment	46,850,364.40
Other equity investment	130,400,000.00	152,800,000.00
Other non-current financial assets	30,260,000.00	208,450,315.01
Investment property	644,936,541.46	668,014,515.82
Fixed assets	1,770,372,338.85	1,612,792,592.67
Construction in progress	294,785,678.31	214,248,125.04
Productive biological assets
Oil and gas assets
Right-of-use asset	1,342,280,387.08
Intangible assets	866,627,549.85	426,352,455.75
Development expenditure
Goodwill	99,867,720.38	99,867,720.38
Long-term prepaid expenses	380,191,006.38	440,955,377.93
Deferred tax assets	424,027,271.38	21,606,436.77
Other non-current assets	1,652,164,395.78	1,151,091,703.31
Total Non-current Assets	7,689,822,247.42	4,996,179,242.68
Total Assets	10,305,183,525.70	14,418,850,027.27
Current liabilities:
Short-term loan	3,152,945,812.59	3,976,019,329.22
Borrowing from the central bank
Borrowings from banks and other financial institutions
Transactional financial liabilities
Derivative Financial liabilitiels

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Notes payable
Accounts payable	282,032,916.52	211,824,402.86
Deposit received
Contract liabilities	3,063,721,290.28	4,925,428,309.33
Financial assets sold for repurchase
Absorbing deposits and interbank deposits
Acting trading securities
Acting underwriting securities
Payroll payable	422,886,856.60	637,448,433.99
Taxes payable	12,566,751.84	131,111,770.78
Other payable	129,043,599.22	9,479,383.03
Inc：Interest payable
Dividend payable
Fees and commissions payable
Reinsurance amounts payable
Liabilities held-for-sale
Non-current Liabilities due within one year	531,876,007.31
Other current liabilities	91,925,853.39	147,765,156.66
Total Current Liabilities	7,686,999,087.75	10,039,076,785.87
Non-current Liabilities:
Insurance contract reserve
Long-term loan
Bonds payable
Inc: Bonds payable_preferred stock
Bonds payable_perpetual bond
Lease liability	635,691,184.87
Long-term payables
Long-term salary payable
Estimated liabilities

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Deferred Income
Deferred tax liability	93,712,172.62	104,677,444.59
Other non-current liabilities
Total Non-current Liabilities	729,403,357.49	104,677,444.59
Total Liabilities	8,416,402,445.24	10,143,754,230.46
Owners' equity:
Share capital	103,807,623.00	103,807,623.00
Other equity instruments
Inc: Other equity instruments_preferred stock
Other equity instruments_perpetual bond
Capital reserve	1,225,481,049.50	1,225,481,049.50
less: Treasury stock
Other comprehensive income	13,200,000.00	30,000,000.00
Special reserve
Surplus reserves	45,000,000.00	45,000,000.00
General risk preparation
Undistributed profits	501,330,081.70	2,870,839,120.70
Total Owners' Equity Attributable To the Parent Company	1,888,818,754.20	4,275,127,793.20
Minority shareholders' equity	-37,673.74	-31,996.39
Total Owners' Equity	1,888,781,080.46	4,275,095,796.81
Total Liabilities and Owners' Equity	10,305,183,525.70	14,418,850,027.27

Legal representative: Wang Zhendong Person in charge of accounting: Shi Lei Head of accounting department: Luo Xue

2.Parent company balance sheet

Unit:RMB

Items	December 31, 2021	December 31, 2020
Current assets:
Monetary funds	59,197,879.74	56,138,356.37
Transactional financial assets	1,573,219.32	1,630,453.37
Derivative financial assets
Notes receivable

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Accounts receivable	28,806,097.45	14,792,320.38
Receivables financing
Prepayments
Other receivables	20,699,731.33	621,900,443.29
Including:interest receivable
Dividend receivable
Inventory
Contract assets
Assets held-for-sale
Non-current assets due within one year
Other current assets
Total current assets	110,276,927.84	694,461,573.41
Non-current assets:
Debt investment
Other debt investment
Long-term receivables
Long-term equity investment	19,190,415,995.14	18,582,307,907.14
Other equity investment	130,400,000.00	152,800,000.00
Other non-current financial assets
Investment property	370,687,463.01	384,641,527.88
Fixed assets	371,414,975.96	383,060,000.00
Construction in progress	72,569,103.57	72,569,103.57
Productive biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred tax assets		20,529,151.44

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Other non-current assets	1,618,391,145.38	501,095,111.10
Total non-current assets	21,753,878,683.06	20,097,002,801.13
Total assets	21,864,155,610.90	20,791,464,374.54
Current liabilities:
Short-term loan	1,201,317,569.59	871,083,875.00
Transactional financial liabilities
Derivative financial liabilities
Notes payable
Accounts payable	83,621,752.26	83,621,752.26
Deposit received
Contract liabilities
Payroll payable
Taxes payable	1,600,302.00	1,437,291.71
Other payable	1,307,916,006.49	446,606,530.72
Including:interest payable
Dividend payable
Liabilities held-for-sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities	2,594,455,630.34	1,402,749,449.69
Non-current liabilities:
Long-term loan
Bonds payable
Bonds payable preferred stock
Bonds payable perpetual bond
Lease liability
Long-term payables
Long-term salary payable
Estimated liabilities
Deferred income

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Deferred tax liability	4,418,304.83	10,007,613.34
Other non-current liabilities
Total non-current liabilities	4,418,304.83	10,007,613.34
Total Liabilities	2,598,873,935.17	1,412,757,063.03
Owners’equity:
Share capital	6,167,399,389.00	6,167,399,389.00
Other equity instruments
Other equity instruments preferred stock
Other equity instruments perpetual bond
Capital reserve	12,775,326,370.33	12,775,326,370.33
Less:Treasury stock
Other comprehensive income	13,200,000.00	30,000,000.00
Special reserve
Surplus reserves	387,458,806.65	387,458,806.65
Undistributed profits	-78,102,890.25	18,522,745.53
Owners’equity	19,265,281,675.73	19,378,707,311.51
Liabilities and owner’s equity	21,864,155,610.90	20,791,464,374.54

3.Consolidated income statement

3.Consolidated income statement	3.Consolidated income statement	3.Consolidated income statement
Unit: RMB
Items	2021	2020
I.Total operating income	6,911,723,331.79	11,202,494,295.04
Inc: Operating income	6,911,723,331.79	11,202,494,295.04
Interest income
Premium earned
Fee and commission income
II. Total operating costs	9,842,898,477.96	9,152,970,989.56
Inc: Operating costs	4,993,717,363.58	4,567,326,931.44
Interest expense

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Fee and commission expenses
Surrender money
Net reimbursement expenditure
Withdrawal of net insurance liability contract reserves
Policyholder dividend expenses
Reinsurance expenses
Taxes and surcharges	35,355,169.74	12,738,714.63
Sales expenses	2,105,098,912.06	1,811,790,113.16
Management expenses	1,315,643,022.03	1,279,869,207.37
Research and development expenses	901,469,538.57	1,050,697,333.79
Financial expenses	491,614,471.98	430,548,689.17
Inc:Interest	274,734,405.81	172,114,852.12
Interest income	58,235,304.20	33,148,136.69
Add: Other income	96,084,140.34	335,711,072.77
Investment income (Loss is listed with "-")	79,269,900.92	256,543,458.65
Including: investment income from associates and joint ventures	-2,149,635.60
Derecognition income of financial assets measured at amortized cost
Exchange earnings ((Loss is listed with "-")
Net exposure hedge income(Loss is listed with "-")
Fair value change income (Loss is listed with "-")	-21,490,322.52	20,984,385.76
Expected credit loss(Loss is listed with "-")	-8,529,849.40	-1,171,052.83
Asset impairment loss(Loss is listed with "-")
Asset disposal income(Loss is listed with "-")	-163,075.82	162,043.59
III. Operating profit (Loss is listed with "-")	-2,786,004,352.65	2,661,753,213.42
Add: non-operating income	18,141,095.89	65,303.00
Less: non-operating expenses	1,303,782.47	674,641.85
IV. Total profit(The total loss is listed with "-")	-2,769,167,039.23	2,661,143,874.57
Less: Income tax expenses	-399,652,322.88	356,812,108.72

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V. Net profit (Net loss is listed with "-")	-2,369,514,716.35	2,304,331,765.85
i. Classified by business continuity
1.Net profit from continuing operations (Net loss is listed with "-")	-2,369,514,716.35	2,304,331,765.85
2.Net profit from discontinued operations (Net loss is listed with "-")
ii. Classification by ownership
1.Net profit attributable to the owner of the parent company	-2,369,509,039.00	2,304,357,742.74
2.Net profit attributable to minority shareholders	-5,677.35	-25,976.89
VI. Net other comprehensive income	-16,800,000.00	-7,500,000.00
Net other comprehensive income after tax attributable to the parent company owner	-16,800,000.00	-7,500,000.00
i. Other comprehensive income that cannot be reclassified into profit or loss	-16,800,000.00	-7,500,000.00
1.Inc: Changes from the remeasurement of the defined benefit plan
2.Other comprehensive income that cannot be transferred to profit or loss under the equity method
3.Changes in the fair value of other equity instruments	-16,800,000.00	-7,500,000.00
4.Changes in fair value of the company's own credit risk
5. Other
ii. Other comprehensive income that will be reclassified into profit or loss
1.Other comprehensive income of convertible profit and loss under the equity method
2.Changes in fair value of other debt investments
3.Financial assets reclassified into other comprehensive income
4.Other credit impairment provisions for investment of creditor's rights
5.Effective portion of profit or loss on cash flow hedging
6.Foreign currency financial statement translation difference
7.Other
Net other comprehensive income after tax attributable to non-controlling interest
VIII. Total comprehensive income	-2,386,314,716.35	2,296,831,765.85

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Total comprehensive income attributable to owners of the parent	-2,386,309,039.00	2,296,857,742.74
Total comprehensive income attributable to minority shareholders	-5,677.35	-25,976.89
IX. Earnings per share
Basic earnings per share	-0.38	0.37
Diluted earnings per share	-0.38	0.37

If a business combination under the same control occurs in the current period, the net profit realized by the combined party before

the combination is: RMB 0.00. The net profit realized by the combined party in the previous period was: RMB 0.00.

Legal representative: Wang Zhendong Person in charge of accounting: Shi Lei

Head of accounting department: Luo Xue

4. Parent company income statement

Unit:RMB

Items	2021	2020
I. Operating income	14,831,488.06	14,829,393.86
Less:operating cost	11,230,514.83	11,336,628.27
Taxes and surcharges	4,240,824.77	4,239,288.81
Sales expenses
Management expenses	25,966,438.27	6,007,122.13
R&D expenses
Financial expenses	47,042,556.34	32,313,823.38
Including:interest expenses	47,157,530.56	32,029,291.66
Interest income	134,790.30	63,868.28
Add:other income	138,234.55	919,605.04
Investment income(Loss is listed with “-”)	-836,172.91	249,600.00
Including: investment income from associates and joint ventures	-2,174,511.83
Derecognition income of financial assets measured at amortized cost
Net exposure hedge income (Loss is listed with “-”)
Fair value change income (Loss is listed with	42,765.95	28,771.73

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“-”)
Expected credit loss (Loss is listed with “-”)	-1,557,086.35	-778,543.18
Asset impairment loss (Loss is listed with “-”)
Asset disposal income (Loss is listed with “-”)	-223,987.77
II.Operating profit(Loss is listed with “-”)	-76,085,092.68	-38,648,035.14
Add: non-operating income
Less: non-operating expenses
III. Total profit(The total loss is listed with “-”)	-76,085,092.68	-38,648,035.14
Less:income tax expenses	20,539,842.93	-9,717,029.89
IV. Net profit(Net loss is listed with “-”)	-96,624,935.61	-28,931,005.25
i. Net profit from continuing operations(Net loss is listed with “-”)	-96,624,935.61	-28,931,005.25
ii. Net profit from discontinued operations(Net loss is listed with “-”)
V. Net other comprehensive income	-16,800,000.00	-7,500,000.00
i. Other comprehensive income that cannot be reclassified into profit or loss	-16,800,000.00	-7,500,000.00
1.Changes from the remeasurement of the defined benefit plan
2.Other comprehensive income that cannot be transferred to profit or loss under the equity method
3.Changes in fair value of other equity instruments	-16,800,000.00	-7,500,000.00
4.Changes in fair value of the company's own credit risk
5.Other
ii. Other comprehensive income that will be reclassified into profit or loss
1.Other comprehensive income of convertible profit and loss under the equity method
2.Changes in fair value of other debt investments
3.Financial assets reclassified into other comprehensive income

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4.Credit impairment provisions of other debt investment
5.Cash flow hedge reserve
6.Foreign currency financial statement translation difference
7.Other
VI. Total comprehensive income	-113,424,935.61	-36,431,005.25
VII. Earnings per share:
ⅰBasic earnings per share
ⅱDiluted earnings per share

5.Consolidated cash flow statement

Unit: RMB

Items	2021	2020
I.Cash Flows from Operating Activities:
Cash received from the sale of goods and the services	5,172,563,759.32	13,887,896,355.44
Net increase in customer deposits and interbank deposits
Net increase in borrowing from central bank
Net increase in funds borrow from other financial institutions
Cash received from the original insurance contract premium
Net cash received from reinsurance business
Net increase in policyholders’ deposits and investment funds
Cash charged with interest, handling fees and commissions
Net increase in funds borrowed in
Net increase in repurchase funds
Net cash received from agent buying and selling of securities
Taxes refund
Other cash received related to other business activities	171,941,814.92	282,559,487.03
Subtotal of cash inflow from operating activities	5,344,505,574.24	14,170,455,842.47
Cash paid for the purchase of goods and services	1,687,330,079.68	1,992,245,380.72
Net increase in customer loans and advances
Net increase in deposit of central bank and interbank

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Cash paid for the original insurance contract
Net increase in borrowed funds
Cash paid for interest, handling fees and commissions
Cash paid for policy dividends
Cash paid to and for employees	6,340,168,377.45	5,483,601,700.80
Various taxes paid	295,559,702.01	428,071,845.08
Other cash paid for business activities	1,119,408,964.00	1,384,067,813.96
Subtotal of cash outflows from business activities	9,442,467,123.14	9,287,986,740.56
Net Cash Flow from Operating Activities	-4,097,961,548.90	4,882,469,101.91
II.Cash Flows from Investing Activities:
Cash received from investment recovery	8,918,329,229.00	41,255,088,090.00
Cash received from investment income	247,231,808.99	194,836,246.67
Net cash received from disposal of fixed assets, intangible assets and other long-term assets	3,012,387.24	206,748.59
Net cash received from disposal of subsidiaries and other business units	51,000,000.00
Other cash received related to investing activities	200,000,000.00
Subtotal of cash inflows from investing activities	9,419,573,425.23	41,450,131,085.26
Cash paid for the purchase and construction of fixed assets, intangible assets and other long-term assets	1,366,834,155.42	1,325,074,196.98
Cash paid for investment	6,312,200,000.00	41,033,698,090.00
Net increase in pledge loans
Net cash paid for aquiring subsidiaries and other business units
Other cash paid related to investing activities		200,000,000.00
Subtotal of cash outflows from investment activities	7,679,034,155.42	42,558,772,286.98
Net Cash Flow from Investing Activities	1,740,539,269.81	-1,108,641,201.72
III.Cash Flows from Financing Activities:
Cash received from investment absorption
Including:cash received from subsidiaries in absorbing minority shareholders'investment
Cash received from loans	4,569,000,000.00	5,269,000,000.00
Other cash received related to fundraising activities		1,000,000.00

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Sub-total of cash inflows from financing activities	4,569,000,000.00	5,270,000,000.00
Cash paid for debt repayment	5,389,000,000.00	4,167,000,000.00
Cash paid for dividends, profits or interest payments	196,236,215.13	1,649,792,933.80
Including:dividends and profits paid by subsidiaries to minority shareholders
Other cash paid related to financing activities	606,571,985.34	1,333,478.85
Subtotal of cash outflows from financing activities	6,191,808,200.47	5,818,126,412.65
Net Cash Flow from Financing Activities	-1,622,808,200.47	-548,126,412.65
IV.Effect of the changes of the exchange rate on cash and the equivalents
V.Net Increase in Cash and Cash Equivalents	-3,980,230,479.56	3,225,701,487.54
Add: balance of cash and cash equivalents at the beginning of the period	5,950,036,489.12	2,724,335,001.58
VI.Balance of cash and cash equivalents at the end of the period	1,969,806,009.56	5,950,036,489.12

6. Parent company cash flow statement

6. Parent company cash flow statement	6. Parent company cash flow statement	6. Parent company cash flow statement
Unit:RMB
Items	2021	2020
I. Cash flow from operating activities:
Cash received from the sale of goods and services
Tax refund
Other cash received related to other business activities	800,735,886.99	407,436,454.23
Subtotal of cash inflow from operating activities	800,735,886.99	407,436,454.23
Cash paid for the purchase of goods and services
Cash paid to and for employees
Various taxes paid	4,860,974.71	5,086,642.85
Other cash paid for business activities	1,030,790,404.92	610,796,109.47
Subtotal of cash outflows from business activities	1,035,651,379.63	615,882,752.32
Net cash flow from operating activities	-234,915,492.64	-208,446,298.09
II. Cash flows from investing activities:
Cash received from investment recovery	82,700,000.00
Cash received from investment income	1,338,338.92	1,700,249,600.00
Net cash received from disposal of fixed assets, intangible assets and other long-term assets	2,507,345.00

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Net cash received from disposal of subsidiaries and other business units
Other cash received related to investing activities
Subtotal of cash inflows from investment activities	86,545,683.92	1,700,249,600.00
Cash paid for the purchase and construction of fixed assets, intangible assets and other long-term assets	55,497.58	300,000,000.00
Cash paid for investment	131,600,000.00	501,500,000.00
Net cash paid for acquiring subsidiaries and other business units
Other cash paid related to investing activities
Subtotal of cash outflows from investment activities	131,655,497.58	801,500,000.00
Net cash flows from investing activities	-45,109,813.66	898,749,600.00
III. Cash flow from financing activities:
Cash received from investment absorption
Cash received from the loan	1,200,000,000.00	1,100,000,000.00
Other cash received related to fundraising activities		1,000,000.00
Subtotal of cash inflows from financing activities	1,200,000,000.00	1,101,000,000.00
Cash paid for debt repayment	870,000,000.00	230,000,000.00
Cash paid for dividends, profits or interest payments	46,923,835.97	1,511,121,270.02
Other cash paid related to financing activities		1,333,478.85
Subtotal of cash outflows from financing activities	916,923,835.97	1,742,454,748.87
Net cash flow from financing activities	283,076,164.03	-641,454,748.87
IV. Effect of the changes of the exchange rate on cash and the equivalents
V. Net increase in cash and cash equivalents	3,050,857.73	48,848,553.04
Add:balance of cash and cash equivalents at the beginning of the period	55,780,356.37	6,931,803.33
VI. Balance of cash and cash equivalents at the end of the period	58,831,214.10	55,780,356.37

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7.Consolidated Statement of Changes in Owners' Equity

Unit: RMB

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Unit: RMB

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8.Statement of Changes in Owners' Equity

Unit: RMB

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Unit: RMB

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Section III. General Information

1. Overview of the company

Offcn Education Technology Co.,Ltd.（referred to as the “company” or “the company”）was formerly known as Yaxia Automobile Co.,Ltd.（refered to as “Yaxia Automobile”），Yaxia Automobile ,a limited company established by Wuhu Yaxia Industrial Co., Ltd. On 30 November 30 2006, obtained the Enterprise Business license of Enterprise Legal Person NO. 3402012104768 issued by Wuhu Administration for industry and commerce. Yaxia Automobile was approved by the China Securities Regulatory Commission (referred to as the "CSRC") for the approval of the initial public offering of Wuhu Yaxia Automobile Co., Ltd. (CSRC License [2011] No. 1046) and issued 22 million RMB ordinary shares to the public and traded on the Shenzhen Stock Exchange in August 2011. The controlling shareholder is Anhui Yaxia Industrial Co., Ltd. (referred to as “Yaxia Industrial”).On 1 July 2016, the company obtained the No. 91340200711040703A“Enterprise Business license of Enterprise Legal Person” issued by the Wuhu Administration for Industry and Commerce. As of 31 December 2021, the company's share capital is RMB 6,167,399,389.00.

In accordance with the resolution of the third extraordinary general meeting of shareholders of Yaxia Automobile in 2018 and the resolution of the 24th meeting of the 4th Board of Directors, and approved by the China Securities Regulatory Commission's Securities Regulatory Commission (2018) 1975, “On the approval of the major asset restructuring of Yaxia Automobile Co., Ltd. and the issuance of shares to Lu Zhongfang and other assets of the approval of assets ” that Yaxia Automobile swapped all assets and liabilities (“exchange-out assets”) other than the retained assets that do not constitute business as of the date of the assessment of the benchmark for the equivalent portion (“exchange-in assets”) of 100.00% of the equity in Beijing Zhonggong Education Technology Co., Ltd. (referred to as "Zhonggong Limited") respectively held by 11 counterparts, including Li Yongxin.And pay the difference between the exchange-out assets and the exchange-in assets by issuing shares.

On 27 December 2018, Yaxia Automobile and the counterpart Yaxia Industrial signed the Confirmation of Delivery of Assets. The closing date of the exchange-out assets is 27 December 2018, from the date of delivery, Yaxia Automobile, the counterparty will complete the delivery obligations, regardless of whether the exchange-out assets (including but not limited to land use rights, home ownership, intellectual property rights and qualifications, permits, other intangible assets, etc.) is actually completed, the ownership of the assets belongs to Yaxia Industrial, and all the rights, obligations, responsibilities and risks related to the disposed assets (including contingent liabilities, hidden liabilities) are owned and undertaken by Yaxia Industrial, which has the actual control and disposal rights over the exchange-out assets, and Yaxia Automobile no longer has any actual rights. On the same day, Zhonggong Limited completed the registration procedures for industrial and commercial changes on shareholder changematters. After the completion of this alteration, Yaxia Automobile holds a 100.00% stake in Zhonggong Limited, accordingly, the controlling shareholder and actual controller of the company will be changed to Li Yongxin and Lu Zhongfang. On 2 February 2019, Yaxia Automobile changed its name and changed its scope of business.

On 23 January 2019, the registration procedures for the transfer of shares of the company and the new shares of the company related to the restructuring transaction were completed.

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Unified social credit code：91340200711040703A

Company residence： Wujiang District, Wuhu City, Anhui Province, Yaxia Automobile City, Beijiang North Road.

Headquarters Address：23 Hanhua Century Building B, Xueqing Road, Haidian District, Beijing

The nature of the industry：Education

Customer nature：Mainly natural persons

Scope of business: technology development, technical services, technology promotion, technology transfer ,technical consulting and technology education and training (only branch to carry out this business)in the field of education and science ; offering exhibition services, organizing cultural and artistic exchange activities (excluding performances), conference services, and consult business management.(Projects subject to approval according to law can only carry out business activities after approval by the relevant departments)

The financial reporting was approved by the Board of Directors of the Company on 28 April 2022.

2. The scope of the consolidated financial statements

The consolidated scope of the consolidated financial statements of the company is determined on a control basis, including the financial statements of the company and all subsidiaries.A subsidiary is an enterprise or entity controlled by the company.The scope of the consolidated financial statements is detailed in note VIII (1)“Interest in subsidiaries”of this report. Changes in the scope of consolidated financial statements are detailed in Note VII “Changes In The Consolidated Scope” of this report.

Section IV. Basis Of Preparation Of Financial Statements

1. Basis of preparation

The financial statements are prepared on a going concern basis，according to the practical transactions，in accordance with the relevant provisions of the Accounting Standards for Business Enterprises, and based on the important accounting policies and accounting estimates described below.

2. Going concern

The company evaluated the ability to continue operations for 12 months from 31 December 2021. After using all available information to make an assessment, it did not find any matters and situations that have significant doubts about the ability to continue operations. It is reasonable to prepare financial statements based on a going concern basis.

Section V. The Company ’ s Significant Accounting Policies And Accounting Estimates

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1. Statement of compliance with the Accounting Standards for Business Enterprises.

The financial statements based on the above-mentioned preparation basis meet the requirements of the latest Accounting Standards for Business Enterprises and its application guidelines, interpretations, and other relevant regulations (collectively referred to as "Enterprise Accounting Standards") issued by the Ministry of Finance, which truly and completely present the company's financial position , financial performance,cash flows and other information for the year then ended.

In addition, the financial report compiled by reference to the listing and disclosure requirements of the disclosure provisions of the Rules for the Information Disclosure and Compilation of Companies Publicly Issuing Securities NO.15:--General Provisions for Financial Report(Revised in 2014) of CSRC as well as the Notice on Implementation of the New Accounting Standards for Listed Companies(Letter of the accounting department [2018] no. 453).

2. Accounting period and business cycle

The Company’s accounting period starts from 1 January and ends on 31 December.

3. Recording currency

The Company adopts Renminbi (RMB) as their recording currency.

4. Measurement attributes of the report items change and used in the current period

Measurement attributes are adopted by the company including history cost，replacement cost，net realizable value， present value，and fair value.

5. Business combinations

5.1 The accounting treatment of business combinations involving enterprises under common control

The company realize achieve a merger under the same control in one transaction or through step-by-step multiple transactions. Assets and liabilities obtaining from the merger of enterprise is measured according to the share of book value of consolidated financial statements of final controlling party under the owner’s equity of combined party within combining date. The difference between the book value of the net assets obtained from company and the book value of the consideration the combination of payment (or the aggregate face value of shares issued as consideration) is adjusted to the capital reserve. If the capital reserve is insufficient to offset, the retained earnings shall be adjusted.

5.2 The accounting treatment of business combinations involving enterprises under uncommon control

Where the cost of combination exceeds the acquirer’s interest in the fair value of the acquiree’s identifiable net assets, the difference is treated as an asset and recognized as goodwill, which is measured at cost on initial recognition. If the combination cost is less than the share of identifiable fair value of net assets of acquiree, firstly, conducting the review of measurement is necessary to achieve the acquiree the identifiable assets, liabilities and the fair value of contingent liabilities as well as the combination costs. The acquiree combination costs after reviews are still less than the fair value of identifiable net asset, the difference will be included into the current profits and losses.

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By step-by-step multiple transaction to achieve business combinations not under common control should be handled in the following order：

（1）Adjust the initial investment cost of long-term equity investments. If the equity held before the purchase date is accounted for using the equity method, it is remeasured at the fair value of the equity on the purchase date, and the difference between the fair value and its book value is included in the current investment income; Changes in other comprehensive income and other owners' equity under the equity method shall be converted to the current income at the acquisition date, except for other comprehensive income arising from the net liabilities or net assets’changes of the benefit plan remeasured by the investee and. arising from changes in the fair value of investment in other equity instruments held.

（2）Recognize goodwill (or the amount included in the current profit or loss). Compare the initial investment cost of the adjusted long-term equity investment with the fair value of the identifiable net assets of the subsidiary that should be enjoyed on the purchase date. If the former is greater than the latter, the difference is recognized as goodwill;The former is less than the latter, and the difference is booked into the current profit and loss.

Circumstances of disposing of equity through multiple transactions to the loss of control of subsidiaries

(1)Determine whether the various transactions in the process of step-by-step disposal of equity to the loss of control of subsidiaries belong to the "package deal" principle

Generally transactions in stages are treatment as a package deal in accounting if the transaction terms, conditions, and economic impact of disposal of the subsidiary's equity interests comply with one or more of the following:

1）These transactions are made simultaneously or with consideration of influence on each other;

2）These transactions can only achieve a complete business outcome when treated as a whole;

3）The occurrence of a transaction depends on the occurrence of at least one of the other transactions;

4 ） A transaction is uneconomical when treated alone, but is economical when considered together with other transactions.

(2) Each transaction in the process of disposing of the equity in stages to the loss of control of the subsidiary belongs to the "package deal" accounting method

Disposal of various transactions in the equity investment of the subsidiary until the loss of control belongs to a package of transactions, each transaction should be accounted for as a transaction that disposes of the subsidiary and loses control; however, Before losing he control each time, the difference between the price and the share of the subsidiary's net asset share corresponding to the disposal of the investment shall be recognized as other comprehensive income in the consolidated financial statements, and shall be transferred to the profit and loss for the period when control is lost.

In the consolidated financial statements, the remaining equity should be remeasured at its fair value on the date when control is lost.The sum of the consideration obtained from the disposal of the equity and the fair value of the remaining equity, minus the difference between the shares of the net assets that should be continuously calculated by the atomic company since the purchase date based on the original shareholding ratio, shall be included in the investment income of

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the period when the company loses control.. Other comprehensive income related to the original subsidiary 's equity investment shall be converted to current investment income or retained earnings when control is lost.

（3）Each transaction in the process of disposing of equity in steps to the loss of control of a subsidiary is not an accounting treatment of “package deal”

If the disposal of the investment in the subsidiary does not lose control, the difference between the disposal price in the consolidated financial statements and the share of the subsidiary ’s net asset to the disposal investment is included in the capital reserve (capital premium or equity premium). If the capital premium is insufficient to offset,the retained earnings should be adjusted.

When disposing of the loss of control over the investment in a subsidiary, in the consolidated financial statements, the remaining equity should be remeasured at its fair value on the date when control is lost. The sum of the consideration obtained from the disposal of equity and the fair value of the remaining equity minus the share of the net assets that should have been calculated by the original subsidiary from the date of purchase based on the original shareholding ratio is included in the Investment income. Other comprehensive income related to the equity investment of the original subsidiary shall be converted to current investment income or retained earnings when control is lost.

6. Preparation of consolidated financial statements

Consolidated financial statements are based on the Parent’s and its subsidiaries’ financial statements in accordence – with Accounting Standards for Business Enterprises No.33 Consolidated financial statement.

7. Classification of joint arrangement and accounting methods of joint operations

7.1 Joint venture arrangements classification and Co-operation accounting treatment

A joint arrangement refers to an arrangement jointly by two or more parties . The joint arrangement has the following characteristics: (1) all participants are bound by the arrangement; (2) two or more participants exercise joint control over the arrangement. No single party shall be able to control the arrangement, and any party that has joint control over the arrangement shall be able to prevent any other party or combination of parties from controlling the arrangement alone.

Joint control refers to the shared control over a certain economic activity as required in the contract, and only exists when all investors sharing such control related to the activity have consented.

A joint arrangement is classified as either a joint operation or a joint venture. A joint operation is a joint arrangement whereby the joint operators have rights to the assets,and obligations for the liabilities, relating to the arrangement. A joint venture is a joint arrangement whereby the joint ventures only have the rights to the net assets under this arrangement.

7.2 Accounting treatment of joint venture arrangement

A joint operator shall recognize the following items in relation to its interest in a joint operation, and account for them in accordance with relevant accounting standards:1) Its solely-held assets, and its share of any assets held jointly;2) Its solely-assumed liabilities, and its share of any liabilities incurred jointly;3) Its revenue from the sale of its share of the output arising from the joint operation;4) Its share of the revenue from sale of the output by the joint operation; 5) Its

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solely-incurred expenses and its share of any expenses incurred jointly.

The participants in a joint venture shall, in accordance with the Accounting Standards for Enterprises No.2 long-term equity investment, make accounting arrangements for the investment.

8. Criteria for the determination of cash and cash equivalents

The term "cash" of cash flow statement refers to cash on hand and deposits that are available for payment at any time. The term of “cash equivalents” refers to short-term (usually due within 3 months from the acquisition date) and highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

9. Foreign currency transaction and foreign currency statement translation

9.1 Transactions denominated in foreign currencies

On initial recognition, a foreign currency amount, including share capital and capital reserves, is translated into functional currency by applying the spot exchange rate on the date of the transaction announced by People’s Bank of China. At the balance sheet date, foreign currency balance comprised of foreign currency monetary items and foreign currency non-monetary items, shall be adjusted: foreign currency monetary items, of which the exchange difference between initial exchange rate and the spot exchange rate at the end of the period, shall be recognized into profit and loss for the period; exchange differences related to a specific-purpose borrowing denominated in foreign currency for constructing an asset that qualifies for capitalization shall be capitalized before it’s ready for intended use and recognized into cost of construction in progress; foreign currency non-monetary items measured at fair value, the difference of which shall be recognized into profit and loss for the period as fair value changes.

9.2 Translation of financial statements denominated in foreign currencies

The assets and liabilities of the balance sheet are translated using the spot exchange rate at the balance sheet date; all items except for 'undistributed profits' of the owner's equity are translated at the spot exchange rate on the transaction date. The revenue and expenses in the income statement are translated using the approximate rate of the spot exchange rate on the transaction date. Differences arising from the translation of foreign currency financial statements are recognised as the other comprehensive income.

10. Financial instruments

10.1 Recognition and derecognition of financial instruments

The company recognizes a financial asset or a financial liability when it becomes one party to the contractual provisions of the instrument.

All regular ways purchasing or selling of financial assets are recognized and derecognized on a trade date basis. Regular way purchasing or selling, means that receive or deliver financial assets within the time limit stipulated by regulations or common practices, as agreed in the terms of the contract. Trade date, is the date the company promises to buy in or sell out the financial assets.

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The company derecognize the financial assets(either a part, or a part of a similar group),which is writing it off the balance sheet, if following conditions are met:

（1）Expiration of the right to receive cash flow from financial assets;

（2）The right to receive cash flow from financial assets has been transferred, or bear the obligation to pay all cash received to third party in time due to “Hand-Over arrangement”; and (a) all risks and benefits of the financial assets has been transferred virtually, or (b) though not all risks and benefits of the financial assets has been transferred, but lose the control of the financial assets.

10.2 Classification and measurement of financial assets

According to the business model for managing financial assets and the contractual cash flow characteristics of financial assets,the company’s financial assets has initially been classified as follows: financial assets at amortized cost, and financial assets at fair value through other comprehensive income,financial assets at fair value through profit or loss. Subsequent measurement of financial assets depends on its categories.

The company's classification of financial assets is based on the company's business model and its characteristics of cash flow.

（1）Financial assets at amortized cost

Financial assets are classified as financial assets at amortized cost when following conditions are met: the company’ s business model for managing financial assets targets to receive contractual cash flow; The contractual terms of the financial asset stipulate that the cash flow generated on a specific date is only the payment of the principal and the interest based on the outstanding principal amount. For such financial assets, using effective interest rate method and subsequently measure at amortized cost, gains or losses arising from amortization or impairment are recognized in current profit or loss.

（2）Liability investment at fair value through other comprehensive income

Financial assets are classified as liability investment at fair value through other comprehensive income when following conditions are met:the company’s business model for managing financial assets targets both the collection of contractual cash flows and the sale of financial assets; The contractual terms of the financial asset stipulate that the cash flow generated on a specific date is only the payment of the principal and the interest based on the outstanding principal amount. For such financial assets, subsequently measure at fair value. The discount or premium is amortized using the effective interest method and recognized as interest income or expense. Except for the impairment loss and the exchange differences of foreign monetary financial assets are recognized as profit or loss for the period, the changes in the fair value of such financial assets are recognized in other comprehensive income, the accumulated gains or losses is transferred to profit or loss until it’s derecognized. Interest income related to such financial assets is included in the current profit and loss.

（3）Equity investment at fair value through other comprehensive income

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comprehensive income, and only the related dividend income is recognized in profit or loss. The accumulated gains or losses is transferred to retained earnings until it’s derecognized.

（4）Financial assets at fair value through profit or loss

Any financial assets that are not held in one of the two business models mentioned above are measured at fair value through profit or loss.At the time of initial recognition, in order to eliminate or significantly reduce accounting mismatches, financial assets can be designated as financial assets at fair value through profit or loss.For such financial assets, subsequently measured at fair value, and all changes in fair value are recognized in profit or loss.

When and only when,the company changes its business model for managing financial assets it must reclassify all affected financial assets.

For financial assets at fair value through profit or loss, the related transaction expense is directly recognized in current profit or loss as incurred,and other financial assets’transaction expense is included in the initial recognition amount.

10.3 Classification and measurement of financial liabilities

The company ’ s financial assets have initially been classified as follows: financial liabilities at amortized cost and financial liabilities at fair value through profit or loss.

The financial liabilities meeting any of the following conditions can be designated as the financial liabilities at fair value through profit and loss：（1） Such designation can eliminate or significantly reduce accounting mismatches.（2）According to corporate risk management or investment strategies as stated in formal written documents, the management and performance evaluation of financial liability portfolios or combinations of financial assets and financial liabilities are based on fair value , and reported to key management personnel on this basis within the enterprise.（3）Such financial liabilities include embedded derivatives that need to be split separately.

The company determines the classification of financial liabilities at initial recognition. For financial liabilities measured at fair value through profit or loss, the related transaction expense is directly recognized in current profit or loss. The related transaction expense of other financial liabilities is included in the initial recognition amount.

Subsequent measurement of financial liabilities depends on its categories:

（1）Financial liabilities at amortized cost

Based on amortized cost, subsequently measure it using the effective interest rate method.

（2）Financial liabilities at fair value through profit or loss

It includes financial liabilities (including derivatives that are financial liabilities) and financial liabilities that are designated at fair value through profit or loss.

10.4 Offsetting of financial instruments

If the following conditions are met at the same time, the net amount of the financial assets and financial liabilities offset each other shall be shown in the balance sheet: there is a legal right to offset the recognized amount, and such legal right is

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currently enforceable;Plans to liquidate the financial asset on a net basis or simultaneously liquidate the financial liability.

10.5 Impairment of financial assets

Based on expected credit losses, the Company undertakes impairment treatment and confirms loss provisions of financial assets at amortised cost, debt instrument investments at fair value through other comprehensive income and financial guarantee contracts.Credit loss refers to the difference between the cash flow of all contracts discounted at the original effective interest rate and the expected cash flow of all contracts receivables, i.e.the present value of all cash shortages.

The company estimates, individually or in combination, the expected credit losses of financial assets measured at amortized cost and financial assets (debt instruments) measured at fair value and whose changes are accounted for in other comprehensive income, taking into account all reasonable and evidence-based information, including forward-looking information.

(1) General model of expected credit loss

If the credit risk of the financial instrument has increased significantly since the initial recognition, the company shall measure the loss provision at the amount equivalent to the expected credit loss of the financial instrument for the entire life of the instrument; If the credit risk of the financial instrument has not increased significantly since the initial recognition, the company shall measure the loss provision at the amount equivalent to the expected credit loss of the financial instrument in the next 12 months. The increase or rollover amount of the loss provision shall be recorded in the current profit and loss as an impairment loss or gain. For the company's specific assessment of credit risk, please refer to Note IX of this report for “ ” details. Risks Associated With Financial Instruments .

The credit risk of the instrument is generally deemed to have increased significantly if the default is more than 30 days, unless there is conclusive evidence that the credit risk of the instrument has not increased significantly since the initial recognition.

Specifically, the company divides the process of credit impairment of financial instruments without credit impairment at the time of purchase or origination into three stages. There are different accounting treatments for the impairment of financial instruments at different stages:

Stage 1: credit risk has not increased significantly since initial recognition.

For the financial instrument at this stage, the enterprise shall measure the loss provision according to the expected credit loss in the next 12 months, and calculate the interest income according to its book balance (that is, the impairment provision is not deducted) and the actual interest rate (if the instrument is a financial asset, the same below).

Stage 2: credit risk has increased significantly since the initial recognition, but credit impairment has not yet occurred.

For a financial instrument at this stage, the enterprise shall measure the loss provision according to the expected credit loss of the instrument throughout its life, and calculate interest income according to its book balance and actual interest rate.

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Stage 3: credit impairment occurs after initial recognition

For the financial instrument in this stage, the enterprise shall calculate the loss provision according to the expected credit loss of the instrument throughout its lifetime, but the calculation of interest income is different from that of the financial asset in the first two stages. For the financial assets whose credit impairment has occurred, the enterprise shall calculate the interest income at its amortized cost (book balance less the impairment provision, that is, book value) and the actual interest rate.

For financial assets whose credit impairment has occurred at the time of purchase or origin, the enterprise shall only recognize the changes in the expected credit loss during the whole duration after the initial recognition as loss provision, and calculate interest income at its amortized cost and the actual interest rate adjusted by credit.

（ 2） The company chooses not to compare the credit risk of a financial instrument with a lower credit risk on the balance sheet date with the credit risk at the time of the initial recognition, but directly assumes that the credit risk of the instrument has not increased significantly since the initial recognition.

If the enterprise determine financial instruments, the lower the risk of default in the borrowers in the short-term ability to fulfill its obligation to pay the contract cash flow is very strong, and even the economic situation and business environment in a long term adverse change, also will not necessarily reduce the borrower's ability to fulfill its obligation to pay the contract cash flow, then the financial instruments can be seen as a lower credit risk.

（3）Receivables and lease receivables

The company for the accounting standards for enterprises no. 14 - revenues, excluding provisions by major financing elements (including according to the criteria does not consider no more than a year of financing elements) in the contract of receivables, the simplified model of credit losses, always in accordance with the expected amount of credit losses throughout the duration of measuring its losses.

For receivables containing significant financing elements and lease receivables specified in the accounting standards for business enterprises no. 21 -- leasing, the company makes an accounting policy choice and chooses to adopt a simplified model of expected credit loss, that is, to measure the loss provision according to the amount equivalent to the expected credit loss in the whole duration.

10.6 Financial asset transfer

If almost all the risks and rewards of ownership of financial assets have been transferred to the transferee, the financial assets are derecognized; if almost all the risks and rewards of ownership of the financial assets are retained, the financial assets are not derecognized.

Neither transfer nor retain almost all risks and rewards of ownership of financial assets, which are dealt with as follows: If the financial assets are abandoned, derecognize the financial assets and recognize the assets and liabilities; If not abandoned, recognize the relevant financial assets according to the extent to which they continue to be involved in the transferred financial assets, and recognize the related liabilities.

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lower of the book value of the financial assets and the financial warranty amount. The financial warranty amount refers to the maximum amount of the consideration received that will be required to be repaid.

11. Accounts receivable

For accounts receivable, whether significant financing is involved or not, the simplified model of expected credit loss is adopted. the Company will always measure its provision for loss based on the amount equivalent to the expected credit loss of its entire duration, and the increase or reversal amount of the provision for loss resulting therefrom is included in the profit and loss of the period as an impairment loss or gain.

The company considers all reasonable and evidence-based information, including forward-looking information, to estimate the expected credit loss of the accounts receivables individually or in combination.

When a single financial asset can evaluate the expected credit loss information at a reasonable cost, the company chooses to calculate the credit loss individually. When a single financial asset cannot evaluate the expected credit loss information at a reasonable cost, the company will divide the accounts receivables into several combinations in accordance with the characteristics of credit risk, and the expected credit loss is calculated on the basis of the combination. The basis for determining the combination is as follows:

Combination Type	The basis for determining the combination
Combination 1	Receivables from related companies
Combination 2	Receivables from hotel services
Combination 3	Other receivables

For the accounts receivable classified as a combination, the company refers to the historical credit loss experience, combines the current situation and the forecast of future economic conditions, and prepared a comparison table between the age of accounts receivable and the expected credit loss rate for the entire duration to calculate the expected credit loss.

12. Receivables financing

If a financial asset meets the following conditions at the same time, it is classified as a financial assets at fair value through other comprehensive income: The company's business model for managing the financial asset is to both collect contract cash flows and sell financial assets; The contractual terms of the financial asset stipulate that the cash flows generated on a particular date are only payments of principal and interest based on the amount of outstanding principal.

The company will transfer the receivables held in the form of discount or endorsement, and this type of business is more frequent and the amount involved is larger whose management business model is essentially to receive both contract cash flows and sell.In accordance with the relevant provisions of financial instruments. the company classifies them as financial assets that measure changes at fair value and account for changes in other comprehensive income.

13. Other receivables

The company adopts the general model of expected credit loss to deal with other receivables, as detailed in Note III

“ ” (10) Financial Instruments .

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The company considers all reasonable and substantiated information, including forward-looking information, to estimate the expected credit losses of other receivables individually or in combination.

When individual financial assets can expect credit losses at a reasonable cost evaluation of information, the company choose individual credit losses, when individual financial assets not credit losses at a reasonable cost evaluation of information, the company on the basis of credit risk characteristics could be divided into several other receivables portfolio, based on the combination of computing expected credit losses, determine the basis of a combination is as follows:

Type	Basis
Combination 1	Amounts due from related parties
Combination 2	Staff receivables, deposits, security deposits
Combination 3	Receivables other than Portfolio 1, Portfolio 2

For other receivables divided into portfolios, the company calculates the expected credit loss through default risk exposure and expected credit loss rate in the next 12 months or the whole duration, by referring to the historical credit loss experience and combining the current situation with the forecast of future economic conditions.

14. Inventory

14.1 Classification of inventories

Inventories refer to the finished goods or commodities held for sale in daily activities, goods in progress in the production process, consumed materials and supplies in the production process or providing services of the Company.

14.2 Measurement of inventories transferred out

Finished goods are accounted for using the weighted average at the end of the month method upon issuance.

14.3 Basis for determining net realizable value of inventories and provision methods for decline in value of inventories.

At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If the net realizable value is below the cost of inventories, a provision for decline in value of inventories is made. For inventories of goods directly used for sale,in the normal production and operation process, the net realizable value is determined by the amount of the estimated selling price of the inventory less the estimated sales cost and relevant taxes and fees; for material inventories that need to be processed, in the normal production and operation process, the net realizable value is determined by the amount of the estimated selling price of finished products produced less the estimated cost to be occurred at the time of completion, the estimated selling expenses and related taxes;on the balance sheet date, some of the same inventory has if the contract price is agreed and there is no contract price in other parts, the net realizable value is determined separately and compared with its corresponding cost to determine the amount of the provision for inventory depreciation or reversal.

14.4 Inventory count system

The perpetual inventory system is maintained for stock system.

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14.5 Amortization of low-value consumables and packages

（1）Low-value consumables

Low-value consumables are amortized by one-time write-off.

（2）Packages

Packages are amortized by one-time write-off.

15. Contract asset

1.Confirmation methods and standards of contract assets

The company presented as contract assets or contract liabilities in the statement of financial position based on the relationship between performance obligations and customer payments.The right that the company are entitled to collect the consideration for having transferred goods or services to the client（except receivables）is presented as contract asset.

Determination methods and accounting treatment methods of expected credit loss of contract assets

The company adopts the simplified expected credit loss model for contract assets, regardless of whether it contains major financing components, that is, the loss reserves are always measured according to the amount of expected credit losses during the entire lifetime, and the resulting increase or reversal of the loss reserves are included in the current profit and loss as an impairment loss or gain.

16. Assets held-for-sale

The company divides the corporate components（or non-current asset） that meet all of the following conditions into holding for sale:（1）Based on the usual practice of selling such assets or disposal groups in similar transactions, they can be sold immediately under current conditions;（2）The sale is highly probable, a resolution has been made on a sale plan and a firm purchase commitment has been obtained and it is expected that the sale will be completed within one year. Approvals from relevant authorities or regulatory authorities have been obtained in accordance with relevant regulations.

The Company adjusts the expected net salvage value held for sale to reflect the net amount of its fair value less costs to sell(not over its carrying amount). The difference between the original book value and the adjusted net residual value is included in the profit or loss of the current period as an asset impairment loss. At the same time, provision for impairment of assets held for sale was made. For the amount of impairment loss of assets confirmed by the disposal group held for sale, the book value of goodwill in the disposal group should be offset first, and then the proportion of the book value of various non-current assets measured in the disposal group according to the application of this standard measurement. Proportionately deducts its book value.

If the fair value of the non-current assets held for sale on the balance sheet date is less than the net value of the selling expenses, the amount of the previous write-down shall be restored and the impairment of assets recognized after being classified as held for sale shall be made. The amount of the loss is reversed and the amount reversed is included in the current profit or loss. Impairment losses on assets recognized prior to classification as held for sale shall not be reversed. If the fair value of the disposal group held for sale on the subsequent balance sheet day is increased, the net amount after the

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sale expense is increased, the amount of the previously written down amount shall be restored, and shall apply to the measurement requirements of this standard after being classified as held for sale. The impairment loss of assets confirmed by non-current assets is reversed within the amount, and the reversed amount is included in the current profit or loss. The carrying amount of the goodwill that has been eliminated and the non-current assets applicable to the measurement of this standard will not be reversed if it is recognized before the assets are classified as held for sale. The subsequent reversal of the asset impairment loss confirmed by the disposal group held for sale shall be based on the proportion of the book value of various non-current assets measured and applied in the disposal group in addition to goodwill, and shall increase its book value proportionately.

The company is committed to a sale plan involving loss of control of subsidiary shall classify all the assets and liabilities of that subsidiary held for sale in consolidated balance sheets when the above criteria are met, regardless of whether the Company retain a non-controlling interests in its former subsidiary after the sale.In the balance sheets of parent company the investment should be classified as held for sale in full.

17. Debt investment

The Company uses the general model of expected credit losses for debt investment. For details, please refer to Note “ ” III.(10) . Financial Instruments .

18. Long-term equity investment

18.1 Determination of investment costs

（1）The business combinations under common control, the combined party to pay in cash, transfers non-cash assets, assumed debt or equity securities as combined consideration, on the combining date according to the owner's equity in the combined party on the final control party's share of the book value of the consolidated financial statements as its initial investment cost. The difference between initial investment cost in the long-term equity investment and book value of the paid merger consideration of the total amount of the face value of the issued shares to adjust capital reserves; if capital reserves are insufficient to write-downs, it needs to adjust the retained earnings.

Where a business combination under the same control is realized step by step, the combination date calculated on the basis of the shareholding ratio shall enjoy the share of the book owner ’ s equity of the combined party as the initial investment cost of the investment. The difference between the initial investment cost and the book value of the original long-term equity investment plus the sum of the book values of further consideration paid for the new shares paid on the merger date is adjusted for capital reserve (capital premium or equity premium).if capital reserve insufficient to offset,then adjust retained earnings.

（2）The business combinations not under common control, in accordance with the payment of the fair value of the merger consideration is its initial investment cost on the acquisition date.

（3）Except for the formation of enterprise merger: if the purchase price is paid in cash, the initial investment cost shall be the purchase price actually paid;Where equity securities are issued, the fair value of equity securities issued shall be taken as the initial investment cost;Where an investor invests, the initial investment cost shall be the value agreed upon in the investment contract or agreement (except where the value agreed upon in the contract or agreement is not fair).

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17.2 Subsequent measurement and recognition methods of profits and losses

For the long-term equity investment controlled by the company to the investee, the company shall adopt the cost method in the individual financial statements of the company; Long-term equity investments with joint control or significant influence shall be accounted for using the equity method.

Under the cost method, a long-term equity investment is measured at initial investment cost . Except for cash dividends or profits already declared but not yet paid that are included in the price or consideration actually paid upon acquisition of the investment, investment income is recognized in the period in accordance with the attributable share of cash dividends or profit distributions declared by the investee,and at the same time whether long-term investment in accordance with the relevant policy considerations of the declined value of asset impairment.

For checking by the equity method, the initial investment cost of the long-term equity investment is not adjusted if it is greater than the fair value share of the net identifiable assets of the investee in the investment; if the initial investment cost of the long-term equity investment is smaller than the fair value share of the net identifiable assets of the investee in the investment, the balance is charged to current profit and loss and the cost of the long-term equity investment is adjusted.

When the equity method is adopted, after the acquisition of long-term equity investment, the investment profit and loss shall be recognized and the book value of long-term equity investment shall be adjusted according to the share of net profit and loss realized by the investee that should be enjoyed or Shared. Upon confirmation of the invested entity shall be accorded to the net profits and losses of the share, in order to obtain the invested entity, when the fair value of the identifiable assets such as basis, according to the company's accounting policies and accounting periods, and offset and associated enterprises and joint ventures between insider trading profits and losses according to the shareholding calculation belongs to part of the investment enterprise (but insider trading loss belongs to the asset impairment loss, should be a full confirmation), net income of the invested entity after adjustment for confirmation. According to the profit or cash dividend declared to be distributed by the investee, calculate the share payable, and correspondingly reduce the book value of the long-term equity investment. The company shall recognize the net loss incurred by the investee to the extent that the book value of the long-term equity investment and other long-term rights and interests substantially constituting the net investment of the investee shall be written down to zero, except where the company is obligated to bear additional losses. For the changes of owners' equity other than the net profit and loss of the investee, the book value of the long-term equity investment shall be adjusted and included in the owners' equity.

17.3 Determine the basis of controlling and significant influence on the invested entity

Control refers to having the power over the investee, enjoying the variable return through participating in the investee's relevant activities, and having the ability to use the power over the investee to affect the return amount; Major influence means that the investor has the right to participate in the decision-making of the financial and business policies of the investee, but cannot control or jointly control the formulation of these policies with other parties.

17.4 Disposal of long-term equity investments
（1）Partial disposal of a long-term equity investment in a subsidiary without loss of control

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If part of the long-term equity investment in the subsidiary is disposed of without losing control, the difference between the disposal price and the book value corresponding to the disposal investment shall be recognized as the current investment income.

（2）Loss of control over a subsidiary by partial disposal of an equity investment or other reasons

If the company loses control over the subsidiary due to the disposal of equity investment or other reasons, the book value of the long-term equity investment corresponding to the sold equity shall be carried forward, and the difference between the sale price and the book value of the disposal long-term equity investment shall be recognized as investment income (loss); Meanwhile, the remaining equity shall be recognized as long-term equity investment or other relevant financial assets according to its book value. If the remaining equity after disposal is able to exert joint control or significant influence on the subsidiary, accounting treatment shall be conducted according to the relevant provisions of the conversion from cost method to equity method.

17.5 Methods of impairment assessment and determining the provision for impairment loss

For the long term investment in subsidiaries, joint venture and associates, The Company reviews the long-term equity investments at each balance sheet date to determine whether there is any indication that they have suffered an impairment loss. If an impairment indication exists, the recoverable amount is estimated. If such recoverable amount is less than its carrying amount, a provision for impairment losses in respect of the deficit is recognized in profit or loss for the period.

19. Investment property

19.1 The Company’s investment properties include a land use right that is leased out; a land use right held for transfer upon capital appreciation; and a building that is leased out.

19.2 The Company uses the cost model for subsequent measurement of investment property, and adopts a depreciation or amortization policy for the investment property, which is consistent with that for fixed assets or intangible assets. The Company reviews the investment properties at each balance sheet date to determine whether there is any indication that they have suffered an impairment loss. If there is any indication that such assets may be impaired, the recoverable amounts are estimated for such assets. If the recoverable amount of an asset or an asset Company is less than its carrying amount, the deficit is accounted for as an impairment loss and is recognized in profit or loss for the period.

20. Fixed asset

20.1 Recognition, measurement and depreciation criteria for fixed assets

Fixed assets are tangible assets that are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes, and have useful lives of more than one accounting year.

Fixed assets are initially measured at acquisition cost, and depreciated over its useful life using the straight-line method since the month subsequent to the one in which it is ready for intended use.

20.2 Deprecation methods for each category of fixed assets

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Category	Deprecation methods	Depreciation period (years)	Residual value rate (%)	Annual depreciation rate (%)
Houses and buildings	Straight-line depreciation method	20-40	5	2.38-4.75
Decoration of fixed assets	Straight-line depreciation method	4-10	--	10.00-25.00
Transportation equipment	Straight-line depreciation method	4	5	23.75
Electronic equipment	Straight-line depreciation method	3-5	5	19.00-31.67
Office equipment	Straight-line depreciation method	3-5	5	19.00-31.67

20.3 Impairment method of fixed assets, impairment preparation provision method

The date of balance sheet, some indications state clearly that the fixed assets conduct impairment, according to the difference between the book value and recoverable amount provision the corresponding impairment loss.

21. Construction in progress

21.1 Construction in progress should be transferred into fixed assets at its actual costs after it has reached the working condition for its intended use. Construction in progress that has reached the working condition but not completed, shall be transferred at its estimated costs. The estimated cost of construction in progress should be adjusted against the actual costs after completion of settlement, while the depreciation already provided will not be adjusted.

21.2 The Company assesses at each balance sheet date whether there is any indication that construction in progress may be impaired. If there is any indication that such assets may be impaired, recoverable amounts are estimated for such assets.

22. Borrowing cost

22.1 Recognition criteria of capitalization

Borrowing costs are capitalized when expenditures for such asset and borrowing costs are incurred and activities relating to the acquisition, construction or production of the asset that are necessary to prepare the asset for its intended use or sale have commenced. Other borrowing costs are recognized as an expense in the period in which they are incurred.

22.2 Period of capitalization

（ 1 ） Borrowing costs directly attributable to the acquisition, construction or production of qualifying asset are capitalized when expenditures for such asset and borrowing costs are incurred and activities relating to the acquisition, construction or production of the asset that are necessary to prepare the asset for its intended use or sale have commenced.

（ 2 ） Capitalization of borrowing costs ceases when the qualifying asset being acquired, constructed or produced becomes ready for its intended use or sale. Capitalization of borrowing costs is suspended during periods in which the acquisition, construction or production of a qualifying asset is suspended abnormally and when the suspension is for a continuous period of more than 3 months. Capitalization is suspended until the acquisition, construction or production of the

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asset is resumed.

（ 3 ） Capitalization of borrowing costs ceases when the qualifying asset being acquired, constructed or produced becomes ready for its intended use or sale，the borrowing costs stop capitalization.

22.3 Capitalization amount of borrowing costs

Where funds are borrowed under a specific-purpose borrowing, the amount of interest to be capitalized is the actual interest expense incurred on that borrowing for the period less any bank interest earned from depositing the borrowed funds before being used on the asset or any investment income on the temporary investment of those funds. Where funds are borrowed under general-purpose borrowings, the Company determines the amount of interest to be capitalized on such borrowings by applying a capitalization rate to the weighted average of the excess of cumulative expenditures on the asset over the amounts of specific-purpose borrowings. The capitalization rate is the weighted average of the interest rates applicable to the general-purpose borrowings.

23. Right-of-use assets

Except for short-term leases and leases for which the underlying asset is of low value, at the commencement date of the lease, the Company recognizes a right-of-use assets.

The Company measures the right-of-use assets at cost. The cost of the right-of-use assets comprises:

23.1 The amount of the initial measurement of the lease liabilities.
23.2 Any lease payments made at or before the commencement date, less any lease incentives.
23.3 Any initial direct costs incurred by the Company.

23.4 An estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.

The company recognizes and measures the costs mentioned in item 4 above in accordance with the ASBE No. 13 - Contingencies.

Initial direct costs are the incremental costs incurred to achieve the lease. Incremental costs are those costs that would not have been incurred if the enterprise had not acquired the lease.

Right-of-use assets are depreciated by the Company in accordance with the ASBE No.4 Fixed Assets. If the Company is reasonably certain, that the lease will transfer ownership of the underlying asset to the Company by the end of the lease term, the right-of-use assets is depreciated from the commencement date to the end of the useful life of the underlying asset. Otherwise, the right-of-use assets is depreciated from the commencement date to the earlier of the end of the useful life of the right-of-use assets or the end of the lease term.

The Company applies ASBE No. 8 Impairment of Assets, to determine whether the right-of-use assets are impaired and perform accounting treatment to identified impairment loss.

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24. Intangible assets

24.1 Intangible assets, including land use rights etc. are recognized at costs.

24.2 Intangible assets with finite useful lives are amotized in accordance with the expected realization method of the economic benefits related to the intangible asset over its estimated useful life. If it is not possible to reliably determine the expected realization method,use the straight-line method.The specific years are as follows:

	Item	Useful life(Year)
Land use rights			40
Software use rights			5-10
Trademark rights			10

24.3 The Company assesses at each balance sheet date whether there is any indication that the intangible assets with definite life may be impaired. If there is any indication that such assets may be impaired, recoverable amounts are estimated for such assets. If the recoverable amount of an asset or an asset group is less than its carrying amount, the deficit is accounted for as an impairment loss and is recognized in profit or loss for the period. For an intangible asset with infinite useful life, the Company reviews the useful life and amortization method at the end of the period.

24.4 Expenditure during the development phase that meets all of the following conditions at the same time is recognized as intangible asset. Expenditure during development phase that does not meet the following conditions is recognized in profit or loss for the period.(1) It is technically feasible to complete the intangible asset so that it will be available for use or sale;(2) The Company has the intention to complete the intangible asset and use or sell it;(3) The Company can demonstrate the ways in which the intangible asset will generate economic benefits, including the evidence of the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the usefulness of the intangible asset;(4) The availability of adequate technical, financial and other resources to complete the development and the ability to use or sell the intangible asset; and(5) The expenditure attributable to the intangible asset during its development phase can be reliably measured.

25. Long-term asset impairment

The enterprise should judge whether there is any indication that the asset may be impaired at the balance sheet date.

The goodwill and intangible assets with an uncertain useful life resulting from a business combination should be tested for impairment annually, regardless of whether there is any indication of impairment.

If the following signs exist, the assets may be impaired:

(1) The market price of assets fell sharply in the current period, and the decline was significantly higher than the expected decline due to the passage of time or normal use; (2) Significant changes of the economic, technical or legal environment in which the enterprise operates and the market in which the assets are located will occur in the current period or in the near future, which will adversely affect the company; (3) The market interest rate or other market investment

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returns have increased during the current period, which affects the company's discount rate for calculating the present value of the expected future cash flow of assets, leading to the recoverable amount has been greatly reduced; (4) There is evidence that the assets have become obsolete or their entities have been damaged; (5) The assets have been or will be idle, terminated or planned to be disposed of in advance; (6)The evidence reported by the enterprise indicates that economic performance of the assets has been or will be lower than expected, such as the net cash flow created by the assets or the realized operating profit (or loss) is far lower (or higher) than the expected amount; (7) Other indications that the asset may have signs of impairment.

If there are any signs of asset impairment, the recoverable amount should be estimated.

The recoverable amount should be determined based on the higher of the net amount of the fair value of the asset minus the disposal costs and the present value of the estimated future cash flows of the asset.

Disposal costs include legal costs related to asset disposal, related taxes, transportation charges, and direct costs incurred to make the asset available for sale.

The present value of the estimated future cash flows of the asset should be determined by discounting the amount of the asset based on the expected future cash flow generated during the continuous use of the asset and at the time of final disposal. The present value of the expected future cash flow of the asset should take into account factors such as the estimated future cash flow of the asset, its useful life, and the discount rate.

The measurement results of the recoverable amount indicate that if the recoverable amount of the asset is lower than its book value, the book value of the asset should be written down to the recoverable amount, and the reduced amount should be recognized as the asset impairment loss and included in the current profit and loss.Meanwhile, corresponding provisions for asset impairment should be made.

26. Long-term prepaid expenses

Long-term prepaid expenses are recorded according to the actual amount incurred and amortized in the period of benefit or within the prescribed period.If the long-term deferred expense item cannot benefit the subsequent accounting period, the amortized value of the item that has not been amortized will be transferred into the current profit and loss.

27. Contract liabilities

The company presented as contract assets or contract liabilities in the statement of financial position based on the relationship between performance obligations and customer payments. The company's obligation to transfer goods or provide services to customers for consideration received or receivable from customers is presented as contract liabilities.

28. Employee's salary

Employee salary is to point to the all forms of remuneration or compensation that Company receive services rendered by employees or give except share-based payment in order to terminate the labor relationship. Employee salary includes short-term salary, severance welfare, dismissal benefits and other long-term employee benefits. The salary that Company offered to the worker spouse, children, dependents, the deceased employee survivors and other beneficiaries, also belong to employee’s salary.

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28.1 Short-term employee benefits

During the accounting period when the employees provide services, the company shall recognize the actual short-term compensation as liabilities and record it into the current profit and loss or the cost of related assets. Among them, non-monetary welfare is measured according to fair value.

28.2 Termination benefits

When the Company terminates the employment relationship with employees before the expiration of the employment contracts or provides compensation as an offer to encourage employees to accept voluntary redundancy, if the Company has a formal plan for termination of employment relationship or has made an offer for voluntary redundancy which will be implemented immediately, and the Company cannot unilaterally withdraw from the termination plan or the redundancy offer, a provision for the compensation payable arising from the termination of employment relationship with employees is recognized with a corresponding charge to the profit or loss for the period, and include in current profits or losses.

28.3 Defined contribution plan

Pursuant to the relevant laws and regulations of the PRC, employees of the Company participate in the social insurance system established and managed by government organization. The Company makes social insurance contributions, including contributions to basic pension insurance at the applicable benchmarks and rates stipulated by the government for the benefit of its employees. The pension insurance contributions are recognized as part of the cost of assets or charged to profit or loss on an accrual basis.

29. Lease liabilities

Substantial On the commencement date of the lease term, the Company recognizes the present value of the unpaid lease payments as lease liabilities.

The lease liabilities are initially measured at the present value of the lease payment not yet paid on the start date of the lease term.

Lease payments include the following five items:

29.1 Fixed payments and in-substance fixed payments, if there is a lease incentive, deduct the amount related to the lease incentive.

29.2 Variable lease payments that depend on an index or rate, which is determined at the time of initial measurement based on the index or rate at the commencement date of the lease term.

29.3 Exercise price for a purchase option provided that the lessee is reasonably certain that the option shall be exercised.

29.4 Payments for exercising the option to terminate the lease provided that the lease term reflects that the lessee shall exercise the option to terminate the lease option.

29.5 Estimated payments due based on guaranteed residual value provided by the lessee.

When calculating the present value of lease payments, the Company adopts the interest rate implicit in the lease as the discount rate; if the interest rate implicit in the lease cannot be determined, the Company adopts the incremental

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borrowing rate as the discount rate.

30. Estimated liabilities

30.1 The company shall recognize this obligation as contingent liability when the obligations arising from the provision of external guarantees, litigation matters, product quality guarantees, loss contracts and other contingencies become the current obligations assumed by the company and the fulfillment of such obligations is likely to result in the outflow of economic benefits from the company and the amount of such obligations can be reliably measured.

30.2 The company shall initially measure the provisions according to the best estimate of the expenses required to perform the relevant current obligations, and shall review the book value of the estimated liabilities on the balance sheet date.

31. Share-based payment

31.1 Categories of share-based payments

Share-based payments comprise equity-settled and cash-settled payments.

31.2 Determination of fair value of equity instruments
（1）If there is an active market, it should be determined based on the quoted price in the active market.

（2）If there is no active market, it is determined by using valuation techniques, including considering the prices used in recent market transactions made by parties familiar with the situation and taking transactions voluntarily, and considering the current fair values and cash flows of other financial instruments that are substantially the same discount method and option pricing model.

31.3 Basis for determining the best estimate of exercisable equity instruments

The Company would make best estimate in accordance with the newly acquired information such as changes in the number of employees entitled to equity instruments.

31.4 Relevant accounting treatment of implementation, modification and termination of share-based payment plan
（1）Equity-settled share-based payments

Equity-settled share-based payments that are immediately available after the grant in exchange for employee services are included in related costs or expenses based on the fair value of the equity instruments on the grant date, and the capital reserve is adjusted accordingly. Equity-settled share-based payments for services that have been completed during the waiting period or that are exercisable only if the required performance conditions are met are exchanged for employee services. At each reporting date during the waiting period, the best estimate of the number of exercisable equity instruments is based on the fair value of the equity instrument grant date, the services obtained in the current period are included in related costs or expenses, and the capital reserve is adjusted accordingly.

For equity-settled share-based payments in exchange for services provided by other parties, if the fair value of services provided by other parties can be reliably measured, they should be measured at the fair value of the services of

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other parties on the acquisition date; if the fair values of services provided by other parties cannot be measured reliably, but for the equity instruments whose fair value can be reliably measured, they should be measured at the fair value of the equity instrument on the date of service acquisition and included in related costs or expenses, increasing owner's equity accordingly.

（2）Cash-settled share-based payments

The cash-settled share-based payment in exchange for employee services immediately after the grant is included in the related costs or expenses at the fair value of the liability assumed by the company on the grant date, and the liability is increased accordingly. Cash-settled share-based payments for services that have been completed within the waiting period or that have met the required performance conditions in exchange for employee services are based on the best estimate of the right to exercise at each balance sheet date during the waiting period, According to the fair value of liabilities assumed by the company, the services obtained in the current period are included in related costs or expenses and corresponding liabilities.

（3）Modifying and terminating the share payment plan

If the amendment increases the fair value of the equity instruments granted, the company will recognize the increase in the acquisition of services in accordance with the increase in the fair value of the equity instruments; if the amendment increases the number of equity instruments granted, the company will increase the value of the equity instruments. The fair value is correspondingly recognized as an increase in access to services; if the company modifies the conditions of the exercisable rights in a manner that benefits employees, the company considers the modified conditions of the exercisable rights when processing the conditions of the exercisable rights.

If the amendment reduces the fair value of the equity instrument granted, the company continues to recognize the amount of services obtained based on the fair value of the equity instrument on the grant date, without considering the decrease in the fair value of the equity instrument; if the amendment reduces the equity granted For the number of instruments, the company will treat the reduction as the cancellation of the granted equity instruments; if the conditions of the exercisable rights are modified in a manner that is not conducive to employees, the revised conditions of the exercisable rights are not considered when processing the conditions of the exercisable rights.

If the company cancels the granted equity instruments or clears the granted equity instruments during the waiting period (except for those that are cancelled because the conditions of the exercisable rights are not met), the cancellation or settlement is treated as an expedited exercisable right and the original Amount recognized during the remaining waiting period

32. Income

32.1 Recognition of income

The company's income is mainly education and training income.

The company recognizes the income upon fulfillment of its performance obligations within the contract, that is, when the client obtains control of the relevant goods.

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32.2 The company classifies the nature of the relevant performance obligations in accordance with the relevant provisions of the income standards to be "performance obligations performed within a specified period " or "performance obligations performed at a specified time point ", and income recognition is carried out in accordance with the following principles.

（1）The performance obligations are to be perfomed within a specified period once the company meets one of the following conditions :

① The client obtains and consumes the economic benefits while the company is fulfilling the performance obligations;

② The client can control assets under construction while the company is still in the process of fulfilling the performance obligations.

③ The asset generated while the company is in the process of performing the contract are indispensable, and the company has the right to collect partial payments for the cumulative performance obligations that have been fulfilled so far whthin the contract period.

If the performance obligations are performed within the specified period , the company will recognize the income within this period in accordance with the progress of the contract ’ s performance, however,except the performance progress cannot be reasonably determined. The company considers the nature of the goods and adopts the output method or input method to determine the appropriate performance progress.

（2）If the performance obligations are performed at the specified time point , the company will recognize the income at the time when the client obtains control over the relevant goods.

In judging whether the client has obtained control over goods or services, the company shall consider the following signs:

① The company has the current right to collect payment for the goods, that is, the customer has the current obligations to pay for the goods.

② The company has transferred legal ownership of the goods to the customer, that is, the customer already has the legal ownership of the goods.

③ The company has transferred physical possession of the goods to the customer, that is, the customer has taken physical possession of the goods .

④ The company has transferred the main risks and rewards of the ownership of the goods to the customer, that is, the customer has obtained the main risks and rewards of the ownership of the goods.

⑤ The customer has accepted the goods.

⑥ Other signs that the customer has obtained control of the product.

The specific policy of the company's income recognition:

The company's income mainly includes ordinary class income and agreement class income. The income from

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face-to-face training of ordinary classes is recognized as income for all pre-collected training fees upon completion of training services; income from online training of ordinary classes is recognized on a straight-line basis during the effective period of service provision. The non-refundable portion of the income from the agreement class is recognized as revenue when the training service is completed; the refundable portion is recognized as revenue when the non-refundable conditions are met according to the agreement.

32.3 Measurement of income

The company shall measure revenue based on the transaction price allocated to each individual performance obligation. When determining the transaction price, the company considers the influence of factors such as variable consideration, major financing components in the contract, non-cash consideration, and consideration payable to customers.

（1）Variable consideration

The company determines the best estimate of the variable consideration based on the expected value or the most likely amount, but the transaction price including the variable consideration should not exceed the amount of the accumulated recognized revenue that it is very likely that a significant reversal not occur when the relevant uncertainty is eliminated. When an enterprise assesses whether it is very likely that a significant reversal of accumulated recognized revenue will not occur, it should also consider the possibility of reversal of revenue and its proportion.

（2）Major financing components

When there is a significant financing component in the contract, the company shall determine the transaction price based on the amount payable in cash when the customer is assumed to obtain control of the goods. The difference between the transaction price and the contract consideration shall be amortized using the effective interest method during the contract period.

（3）Non-cash consideration

If the customer pays a non-cash consideration, the company shall determine the transaction price based on the fair value of the non-cash consideration. If the fair value of the non-cash consideration cannot be reasonably estimated, the company determines the transaction price indirectly by referring to the stand-alone selling price of the goods it promises to transfer to the customer.

（4）Consideration payable to customers

For the consideration payable to the customer, the consideration payable shall be offset by the transaction price, and the current income is offset at the later point when the relevant income is recognized and the customer's consideration is paid, except when the customer's consideration is payable to obtain other clearly distinguishable products from the customer.

If the enterprise pays the customer consideration to obtain other clearly distinguishable goods from the customer, it shall confirm the purchased goods in a manner consistent with other purchases by the enterprise. If the consideration payable by the enterprise to the customer exceeds the fair value of the clearly distinguishable commodity obtained from the

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customer, the exceeding amount shall be offset against the transaction price. If the fair value of the clearly distinguishable goods obtained from the customer cannot be reasonably estimated, the enterprise shall offset the consideration payable to the customer in full from the transaction price.

33. Contract cost

Contract costs are divided into contract performance costs and contract acquisition costs.

If the cost incurred by the company to fulfill the contract meets the following conditions at the same time, it shall be recognized as an asset as the contract performance cost:

（1）The cost is directly related to a current or expected contract, including direct labor, direct materials, manufacturing
expenses (or similar expenses), clearly the cost borne by the customer, and other costs incurred only due to the contract;
（2）This cost increases the company's future resources for fulfilling its performance obligations;
（3）The cost is expected to be recovered.

The incremental cost incurred by the company to obtain the contract is expected to be recovered, and recognized as an asset as the contract acquisition cost; however, if the asset amortization does not exceed one year, it can be included in the current profit and loss when it occurs.

Assets related to contract costs are amortized on the same basis as the recognition of the revenue of goods or services related to the asset.

If the book value of assets related to contract costs is higher than the difference between the following two items, the company will make provision for impairment of the excess part and recognize it as an asset impairment loss:

（1）The remaining consideration expected to be obtained due to the transfer of goods or services related to the asset;
（2）Estimate the costs that will be incurred for the transfer of the related goods or services.

If the aforementioned asset impairment provision is subsequently reversed, the book value of the asset after the reversal shall not exceed the book value of the asset on the date of reversal under the assumption that no impairment provision is made.

34 . Government subsidy

34.1 Government grants include asset related government grants and income related government grants.

34.2 If a government grant is in the form of a transfer of a monetary asset, it is measured at the amount received or receivable. If a government grant is in the form of a non-monetary asset, it is measured at fair value. If the fair value cannot be reliably determined, it is measured at a nominal amount.

34.3 The government grant adopts the total method
（1）A government grant related to an asset is recognized as deferred income, and amortized to profit or loss on a
reasonable and systematic basis over the useful life of the related asset. If the relevant assets are sold, transferred,

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scrapped or damaged before the end of their useful lives, the undistributed balance of related deferred income will be transferred to the profit or loss of the asset disposal in the current period.

（ 2 ） If a government grant related to income is used to compensate for the related expenses or losses in the subsequent period, it shall be recognized as deferred income and shall be recorded in the current profit or loss in which the relevant expenses are recognized; For the compensation of related expenses or losses that have occurred, they shall be directly included in the current profits and losses.

For government grants that include both the asset-related portion and the income-related portion, the different parts are separately accounted for; if it is indistinguishable, the overall classification is revenue-related government subsidies.

34.4 Government grants related to the company's daily activities in accordance with the nature of the economic business are included in other income or written down the related costs; government grants that are unrelated to the daily activities of the company shall be included in non-operating income and expenditure.

35. Deferred income tax assets and the deferred income tax liabilities

35.1 According to the book value of the assets, liabilities and its tax base the difference between the (not confirmed project as assets and liabilities of its tax base can be determined in accordance with the provisions of the tax law, the tax base and the difference between the book number), according to the forecast of the asset is recovered or the applicable tax rate calculation during the debt confirmed deferred income tax assets and deferred income tax liabilities.

35.2 Confirm the deferred income tax assets to probably get used to making the deductible temporary differences are limited to the amount of taxable income. During the balance sheet date, there is strong evidence that the future is likely to obtain sufficient taxable income to offset the deductible temporary difference, confirm the unconfirmed deferred income tax assets in previous accounting periods.

35.3 On the balance sheet date, review the book value of the deferred income tax assets, and if during the period of the future may not be able to obtain sufficient taxable income to offset the benefit of the deferred income tax assets, the write-downs on the book value of the deferred income tax assets. If it is likely to obtain sufficient taxable income, return the amount of write-downs.

35.4 The Company's current income tax and deferred income tax as recorded into the profits and losses of the current income tax expenses, or earnings, but does not include the income tax in the following circumstances: (1) The business combination;(2) Direct confirmation of transactions or events in the owner's equity.

36. Lease

36.1 Lessee

When the Company is the lessee, on the commencement date of the lease period, except for short-term leases and low-value asset leases that are selected for simplified treatment, the right-of-use assets and lease liabilities are recognized for leases.

After the commencement date of the lease period, the Company adopts the cost model for subsequent measurement

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of the right-of-use asset. With reference to the relevant depreciation provisions of "ASBE No. 4 - Fixed Assets", depreciation is provided for right-of-use assets. If the lessee can reasonably determine that it will obtain the ownership of the leased asset at the expiration of the lease term, it shall accrue depreciation over the remaining useful life of the leased asset. If it cannot be reasonably determined that the ownership of the leased asset can be obtained at the expiration of the lease term, depreciation shall be accrued in the shorter period between the lease term and the remaining useful life of the leased asset. The Company determines whether the right-of-use asset is impaired in accordance with the "ASBE No. 8 - Impairment of Assets", and performs accounting treatment on the identified impairment losses.

The company calculates the interest expense of the lease liability during the lease term at a fixed interest rate and includes it in the current profit and loss. According to the "ASBE No. 17 - Borrowing Expenses" and other standards that should be included in the cost of relevant assets, such provisions shall apply.

36.2 Lessor

（1）Finance lease

As the lessor, on the commencement date of the lease term, the Company recognizes the finance lease receivables for the finance lease, derecognizes the finance lease assets, and calculates and recognizes the interest income in each period of the lease term according to the fixed periodic interest rate.

（2）Operating lease

As the lessor, the Company shall, in each period of the lease term, adopt the straight-line method or other systematic and reasonable method to recognize the lease receipts from operating leases as rental income. Capitalize the initial direct expenses related to operating leases, amortize them on the same basis as rental income recognition during the lease term, and include them in the current profit and loss by installments.

For the fixed assets in the operating lease assets, the company shall adopt the depreciation policy for similar assets to accrue depreciation; for other operating lease assets, it shall use a systematic and reasonable method for amortization according to the enterprise accounting standards applicable to the assets. In accordance with the provisions of "ASBE No. 8 - Impairment of Assets", the company determines whether the operating lease assets are impaired and performs corresponding accounting treatment.

Section IV. Taxation

1. Major categories of taxes and tax rates

Category of tax	Basis	of tax computation	of tax computation		Tax rate
	Taxable	revenue	for sales	of
Value-added tax					3%、5%、6%
	goods and supply		of services
City maintenance and
	Circulation Taxes payable				5%、7%
construction tax

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Category of tax	Basis of tax computation	Tax rate
Corporate income tax	Taxable income	15%、20%、25%
Education surcharge	Circulation Taxes payable	3%
Local education surcharge	Circulation Taxes payable	2%

1.1 Value-added tax

According to the "Notice of the Ministry of Finance and the State Administration of Taxation on Comprehensively Launching the Pilot Project of Changing Business Tax to Value-added Tax" (Cai Shui [2016] No. 36) and the "Ministry of Finance and State Administration of Taxation on Clarifying the Reinsurance, Notice of the Real Estate Leasing and Non-Certificate Education Policy (Cai Shui [2016] No. 68) related provisions, the company's subsidiaries and affiliates' income from non-degree education services are subject to VAT at 3% and 6% tax rates .

The company and its subsidiaries operate leased buildings and buildings in accordance with the relevant provisions of the “ Statement of the State Administration of Taxation on Issuing the Interim Measures for the Administration of Value-added Tax Levy of Real Estate Operating Leasing Services Provided by Taxpayers ” (State Administration of Taxation Announcement 2016 No. 16) You can choose to apply the simple tax calculation method and calculate the amount of VAT payable according to the 5% levy rate.

1.2 Corporate income tax

（1）The company's subsidiary, Zhonggong Limited Income Tax, is paid in advance by each branch at the place of registration, and the head office is settled and paid.

（2）The company has different taxpayers with different corporate income tax rates, as detailed below：

Name of the company	Tax rate
1. The Company	25%
2. Offcn Ltd.	15%
3.Wuhu Yawei Automobile Sales Service Co., Ltd	20%
4.Ningguo Yaxia Motor Vehicle Driver Training School (Co., Ltd.)	20%
5.Huangshan Yaxia Fudi Automobile Sales Services Co., Ltd.	20%
6.Chaohu Yaxia Kaixuan Automobile Sales Service Co., Ltd.	20%
7.Bozhou Yaxia Motor Vehicle Driver Training School Co., Ltd.	20%
8.Suzhou Bokai Automobile Sales Service Co., Ltd.	20%
9.Shaanxi Offcn Education Technology Co. Ltd.	25%
10.Chengdu Offcn Future Education Training School Co. Ltd.	25%
11.Lu’an Yazhong Real Estate Information Consulting Co., Ltd.	25%

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Name of the company	Tax rate
12.Lu’an Zhongke Real Estate Information Consulting Co., Ltd.	25%
13.Zhejiang Offcn Education Technology Co. Ltd..	20%
14.Taizhou Offcn Future Enterprise Management Consulting Co., Ltd.	20%
15.Wenling Offcn Information Consulting Co., Ltd	20%
16.Beijing Offcn Xinzhiyu Online Technology Co., Ltd.	20%
17.Hulun BuirHailar Offcn Education Information Consulting Co., Ltd..	20%
18.Xilinhot Offcn Future Education Consulting Co., Ltd	20%
19.Yueqing Lecheng Offcn Training Center Co., Ltd..	20%
20.Jiaozuo Offcn Future Education Service Co., Ltd	20%
21.Xinzheng Offcn Cultural Communication Co., Ltd..	20%
22.Chongqing Jiangbei Offcn Vocational Examination Training Co., Ltd.	20%
23.Nanning Offcn Future Education Consulting Co., Ltd.	20%
24.Baiyin Offcn Future Education Consulting Co., Ltd.	20%
25.Beijing Xinde Zhiyuan Enterprise Management Consulting Co., Ltd..	20%
26.Nanjing Huiyue Hotel Management Co., Ltd.	20%
27.Shandong Kunzhong Real Estate Co., Ltd.	20%
28.Sanmenxia Offcn Cultural Communication Co., Ltd.	20%
29.Liaoning Offcn Academic & Cultural Exchange Co., Ltd.	20%
30.Liaoning Offcn Education Technology Co., Ltd.	25%
31.Shandong Offcn Education Technology Co., Ltd.	25%
32.Jilin Changyi Offcn Education Training School Co., Ltd.	20%
33.Yuxi Offcn Training School Co., Ltd.	20%
34.Tonghua Offcn Training School Co., Ltd.	15%
35.Hunan Lightsalt Offcn Education Technology Co., Ltd..	20%
36.Tianjin Hexi Offcn Training School Co., Ltd.	20%
37.Chengdu Offcn Education Training School Co., Ltd.	20%
38.Shandong Zhuoda Business Management Co., Ltd.	20%
39.Liaoning Zhongcheng Real Estate Development Co.,Ltd.	20%
40.Wuhu Offcn Training School Co. Ltd.	20%
41.Wuhan Guoshang Human Resource Service Co., Ltd.	25%

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Name of the company	Tax rate
42.Jinan Zhangqiu Offcn Training School Co.,Ltd.	20%
43.Mengzi Offcn Education Training Co. Ltd..	20%
44.Beijing Offcn Technology Development Co. Ltd..	20%
45.Shanghai Offcn Education Technology Co. Ltd.	20%
46.Guangzhou Offcn Smart Education Technology Co. Ltd.	20%
47.Pingshan Offcn Education Technology Co. Ltd.	20%
48.Shandong Offcn Education Training School Co. Ltd.	20%
49.Lanzhou Offcn Education Training School Co. Ltd.	20%
50.Anshan Tiedong Offcn Education Training School Co., Ltd.	20%
51.Diqing Offcn Training School Co., Ltd.	20%
52.Dali Offcn Education Training School Co., Ltd.	20%
53.Harbin Nangang Offcn Education Training School Co., Ltd.	20%
54.Nujiang Offcn Training School Co., Ltd.	20%
55.Weixi Offcn Education Training School Co., Ltd.	20%
56.Beijing Offcn Century Education Technology Co., Ltd	25%

2. Policies and basis of the important tax incentives

2.1 Value-added tax

（1）According to the "Announcement of the Ministry of Finance and the State Administration of Taxation on Clarifying the VAT Exemption Policy for Small-scale VAT Taxpayers" (Cai Shui [2021] No. 11), in order to further support the development of small and micro enterprises, from 1 April 2021 to 31 December 2022, small-scale value-added taxpayers with monthly sales of less than RMB 150,000 (including the principal) are exempt from value-added tax. The company's subsidiaries and subsidiaries that meet the exemption conditions are exempt from VAT.

（ 2 ） According to the Notice of the Ministry of Finance and the State Administration of Taxation on the Relevant Policies on Deduction of Value Added Tax for Special Equipment and Technical Maintenance Costs of Value Added Tax Control System (Cai Shui [2012] No. 15), the VAT taxpayers in 2011 for the first purchase of special equipment for the VAT tax control system (including separate ticket machines) after December 1 (including the same below), the VAT invoice obtained from the purchase of special equipment for the VAT tax control system can be used for the full amount of the VAT payable is deducted (the deduction is the total amount of price and tax), and the deduction that is insufficient can be carried forward to the next period to continue the deduction. The VAT taxpayer's technical maintenance fee paid after 1 December 2011 (excluding the technical maintenance fee paid before 30 November 2011) can be added to the value of the technical maintenance fee invoice issued by the technical maintenance service unit. The full amount of the tax payable is deductible, and those that are insufficient for deduction can be carried forward to the next period to continue the deduction. The

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company and the qualified subsidiaries and subsidiaries should deduct the VAT payable amount in full according to the regulations.

（3）In accordance with the "Announcement on Supporting Tax Policies for the Prevention and Control of Pneumonia Epidemic Caused by the Novel Coronavirus Infection" (Announcement No. 8 of 2020 by the Ministry of Finance and the State Administration of Taxation), income from providing with public transportation services, daily life services, and delivering services for residents with essential living materials by the taxpayer is exempt from value-added tax. The specific scope of public transportation services shall be implemented in accordance with the "Regulations on Issues Related to the Pilot Program of Changing Sales Tax to Value-Added Tax" (Published and issued by Caishui [2016] No. 36). The specific scope of life services and express delivery services shall be implemented in accordance with the "Sales Services, Intangible Assets, and Real Estate Notes" (issued by Caishui [2016] No. 36). The company ’ s qualified subordinate branches and subsidiaries that meet the exemption conditions are exempt from the value-added tax.

（ 4 ） According to the "Announcement on Deepening the Relevant Policies of Value-Added Tax Reform" (Announcement No. 39, 2019 of the State Administration of Taxation, Ministry of Finance), from April 1, 2019 to December 31, 2021, production and living are allowed Taxpayers in the production and living service industry add 10% to the deductible input tax for the current period to deduct the tax payable. The company’s qualified subordinate branches and subsidiaries will additionally deduct the value-added tax payable according to this preferential policy.

2.2 Education surcharge, local education surcharge

According to the Notice of the Ministry of Finance and the State Administration of Taxation on Expanding the Exemption Scope of Government Funds(Cai Shui [2016] No. 12), starting from 1 February 2016, additional education fees will be exempted, The scope of the local education supplement and water conservancy construction fund should be expanded by the current obligees who pay monthly taxes or monthly sales or turnover of not more than RMB 30,000 (quarterly taxation of quarterly sales or turnover of not more than RMB 90,000). To the obligor who pays the monthly sales or turnover of not more than RMB 100,000 (the quarterly sales or turnover of the quarterly tax does not exceed RMB 300,000). Subsidiaries and subsidiaries of the company that meet the conditions for exemption are exempted from education surcharge and local education surcharge.

2.3 Corporate income tax

（1）On October 21, 2020, Zhonggong Co., Ltd. passed the high-tech enterprise certification organized by the Beijing State Taxation Bureau, Beijing Local Taxation Bureau, Beijing Finance Bureau, and Beijing Science and Technology Commission, and obtained the high-tech enterprise certificate numbered GR202011002730. The certificate is valid from October 21, 2020 to October 20, 2023. Zhong Gong Co., Ltd. and its subordinate branch calculated and paid corporate income tax at a tax rate of 15%.

（ 2 ） On September 28, 2021, Tonghua Zhonggong Training School Co., Ltd., a subsidiary of the company, was recognized by the Jilin Provincial Taxation Bureau of the State Administration of Taxation, the Jilin Provincial Department of Finance, and the Jilin Provincial Department of Science and Technology, and obtained the high-tech enterprise certificate No. GR202122000472. The certificate is valid. From September 28, 2021 to September 27, 2024, Tonghua Zhonggong

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Training School Co., Ltd. calculates and pays corporate income tax at a rate of 15%.

（3）According to the Announcement of the State Administration of Taxation on Matters Concerning the Implementation of Income Tax Preferential Policies Supporting the Development of Small and Low-profit Enterprises and Individual Industrial and Commercial Households (State Administration of Taxation Announcement No.8 [2021]), from January 1, 2021 to December 2022 On March 31, the annual taxable income of small and low-profit enterprises does not exceed 1 million yuan, which will be included in the taxable income at a reduced rate of 12.5%, and the enterprise income tax will be paid at the tax rate of 20%. Qualified subsidiaries of the Company apply this policy to calculate and pay corporate income tax.

（4）According to the "Notice on Clearly Enjoying the Scope of Small and Low-Profit Enterprises that Are Exempted from the Local Share of Coporate Income Tax of the "Notice of the People ’ s Government of the Inner Mongolia Autonomous Region Party Committee and Autonomous Region" (State Administration of Taxation Announcement No.8 [2021]) For small and low-profit enterprises with a taxable income of no more than 1 million yuan, in accordance with the " Announcement of the State Administration of Taxation on Matters Concerning the Implementation of Income Tax Preferential Policies Supporting the Development of Small and Low-profit Enterprises and Individual Industrial and Commercial Households" (Caishui [2019] No. 13), the annual taxable income is reduced by12.5%. After calculating the corporate income tax at a tax rate of 20%, the taxable income is exempted from the local share of corporate income tax (ie 40%) in accordance with the "Notice issued by the People’s Government of the Inner Mongolia Autonomous Region Party Committee and Autonomous Region" (Nei Dangfa [2018] No. 23) section). The company's qualified subsidiaries shall apply this policy to calculate and pay corporate income tax.

Section V.Changes In Accounting Policies And Accouting Estimates, And Corrections of Accounting Errors

1. Changes in Accounting Policies

1.1 The company's eighteenth meeting of the fifth board of directors held on April 28, 2021 approved the adoption of the relevant provisions of the"ASBE No. 21 - Leasing" (Cai Kuai [2018] No. 35) from January 1, 2021. It is stipulated that the amount of right-of-use assets, lease liabilities, retained earnings at the beginning of the year and other related items in the financial statements should be adjusted according to the cumulative impact, and no adjustment will be made to the information of comparable periods.The impact of accounting policy see note .V.4 and V.5.

According to the provisions of the new lease standards, the company chooses not to re-evaluate whether a contract is a lease or contains a lease for a contract that existed before the date of initial application.

（1）The company as the lessee

The Company has elected to adjust only the cumulative impact of lease contracts that have not been completed as of January 1, 2021. The cumulative effect amount of the first execution adjusts the amount of retained earnings and other related items in the financial statements at the beginning of the current period of the first execution (i.e. January 1, 2021), and no adjustment is made to the comparable period information.

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The Company recognizes right-of-use assets and lease liabilities for all leases (except short-term leases and leases of low-value assets for which the simplified treatment method is selected).

For operating leases prior to the date of initial application, the Company measures the lease liability based on the present value of the remaining lease payments discounted at the incremental borrowing rate on the date of initial application, while each lease is based on an amount equal to the lease liability and based on prepaid rent Make the necessary adjustments to determine the right-of-use asset.

The Company conducts impairment test on right-of-use assets and performs corresponding accounting treatment in accordance with relevant regulations on asset impairment.

The Company has adopted the following simplified treatment for operating leases prior to the date of initial execution:

1）When measuring lease liabilities, the same discount rate may be used for leases with similar characteristics; the measurement of right-of-use assets may not include initial direct costs;

2）If there is an option to renew the lease or to terminate the lease, the company will determine the lease term according to the actual exercise of the option before the first execution date and other latest information;

3）As an alternative to the right-of-use asset impairment test, the Company assesses whether a contract containing a lease is onerous before the date of initial application, and adjusts the right-of-use asset based on the amount of the loss provision included in the balance sheet before the date of initial application;

4）No retrospective adjustment will be made for lease changes before the first implementation date, and accounting treatment will be carried out in accordance with the new lease standards according to the final arrangements for lease changes.

（2）The company as the lessor

The Company does not need any transitional adjustment for the lease as the lessor, and will carry out accounting treatment in accordance with the new lease standards from the date of initial implementation.

1.2 The Company has adopted the relevant provisions of the Interpretation No. 14 of ASBE (Cai Kuai [2021] No. 1) from January 1, 2021. Adjust the amount of retained earnings at the beginning of the period and other related items in the financial statements according to the cumulative impact, and do not adjust the information for comparable periods. Changes in accounting policies have no impact on the Company.

1.3 From January 1, 2021, the company adopts the relevant provisions of "Related Presentation of Centralized Fund Management" in "Accounting Standards for Business Interpretation No. 15" (Cai Kuai [2021] No. 35). For the financial statements of the enterprise that have not been presented in accordance with the above provisions before the release, the financial statement data of the comparable period shall be adjusted accordingly in accordance with this Interpretation. Changes in accounting policies have no impact on the Company.

2. Changes in Accounting Estimates

None.

3. Corrections of Accounting Errors of Prior Period

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None.

4. Implemented the new lease standards for the first time and adjusted the relevant items in the financial statements at the beginning of the year.

Consolidated Balance Sheet Unit：RMB	Consolidated Balance Sheet Unit：RMB	Consolidated Balance Sheet Unit：RMB	Consolidated Balance Sheet Unit：RMB
Item	31 December 2020	1 January 2021	Ajustment
Current Assets:
Cash and cash equivalents	5,950,395,089.12	5,950,395,089.12
△Settlement reserve
△Due from banks and other financial institutions
Financial assets held for trading	983,205,858.25	983,205,858.25
Derivative Financial assets
Notes Receivable
Accounts Receivable	21,493,637.66	21,493,637.66
Financing receivables
Prepayments	2,204,120.00	2,204,120.00
△Premium receivable
△Reinsurance premiun receivable
△Reserve receivable for reinsurance
Other receivables	304,318,966.20	304,318,966.20
Inc: interest receivables
Dividends receivables
△Financial assets purchased under resale agreements
Inventories
Contract assets
Available for sale assets
Non-current assets due within one year	1,985,873,462.75	1,985,873,462.75
Other current assets	175,179,650.61	44,858,022.80	-130,321,627.81
Total current assets	9,422,670,784.59	9,292,349,156.78	-130,321,627.81
Non-current assets:

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Item	31 December 2020	1 January 2021	Ajustment
△Loans And Advances
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments
Other equity instruments	152,800,000.00	152,800,000.00
Other non-current financial assets	208,450,315.01	208,450,315.01
Investment properties	668,014,515.82	668,014,515.82
Fixed assets	1,612,792,592.67	1,612,792,592.67
Construction in progress	214,248,125.04	214,248,125.04
Bearer biological assets
Oil and gas assets
Right-of-use assets		1,491,006,998.14	1,491,006,998.14
Intangible assets	426,352,455.75	426,352,455.75
Development expenditure
Goodwill	99,867,720.38	99,867,720.38
Long-term prepaid expenses	440,955,377.93	412,508,666.20	-28,446,711.73
Deferred tax assets	21,606,436.77	21,606,436.77
Other non-current assets	1,151,091,703.31	1,151,091,703.31
Total Non-current Assets	4,996,179,242.68	6,458,739,529.09	1,462,560,286.41
Total Assets	14,418,850,027.27	15,751,088,685.87	1,332,238,658.60
Current liabilities:
Short-term borrowings	3,976,019,329.22	3,976,019,329.22
△Borrowings from central bank
△Placement from banks and other financial institutions
Financial liabilities held for trading
Derivative Financial liabilitiels
Notes payable
accounts payable	211,824,402.86	211,824,402.86

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Item	31 December 2020	1 January 2021	Ajustment
Receipts in advance
Contract liabilities	4,925,428,309.33	4,925,428,309.33
△Financial assets sold under repurchase agreements
△Absorbing deposit and deposit in inter-bank market
△Customer deposits for trading in securities
△Amounts due to issuer for securities underwriting
Employee benefits payable	637,448,433.99	637,448,433.99
Taxes payable	131,111,770.78	131,111,770.78
Other payable	9,479,383.03	9,479,383.03
Inc: Interest payables
Dividends payables
△Fees and commissions payable
△Reinsurance accounts payable
Held-for-sale liabilities
Non-current Liabilities due within One Year		699,372,590.26	699,372,590.26
Other current liabilities	147,765,156.66	147,765,156.66
Total Current Liabilities	10,039,076,785.87	10,738,449,376.13	699,372,590.26
Non-current Liabilities:
△Deposits for insurance contracts
Long-term borrowings
Bonds payable
Inc: preference share
Perpetual bond
Lease liabilities		632,866,068.34	632,866,068.34
Long-term payables
Long-term employee benefits payable
Provisions

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Item	31 December 2020	1 January 2021	Ajustment
Deferred Income
Deferred tax liabilities	104,677,444.59	104,677,444.59
Other non-current liabilities
Total Non-current Liabilities	104,677,444.59	737,543,512.93	632,866,068.34
Total Liabilities	10,143,754,230.46	11,475,992,889.06	1,332,238,658.60
Owners'equity:
Paid-in capital (share capital)	103,807,623.00	103,807,623.00
Other equity instrument
Inc: preference share
Perpetual bond
Capital reserve	1,225,481,049.50	1,225,481,049.50
Deduct: Treasury shares
Other comprehensive income	30,000,000.00	30,000,000.00
Special reserve
Surplus reserve	45,000,000.00	45,000,000.00
△General risk reserve
Retained earnings	2,870,839,120.70	2,870,839,120.70
Total Owners' Equity Attributable To the Company	4,275,127,793.20	4,275,127,793.20
Minority interests	-31,996.39	-31,996.39
Total Owners' Equity	4,275,095,796.81	4,275,095,796.81
Total Liabilities and Owners' Equity	14,418,850,027.27	15,751,088,685.87	1,332,238,658.60

Description of the adjustment of each item:

On January 1, 2021, the Company adopted the relevant provisions of ASBE No. 21 - Leases (Cai Kuai [2018] No. 35). Adjust the amount of right-of-use assets, lease liabilities, retained earnings at the beginning of the year and other related items in the financial statements according to the cumulative impact, and do not adjust the information for comparable periods. Changes in accounting policies resulted in the following changes in the consolidated balance sheet data on January 1, 2021: other current assets decreased by RMB 130,321,627.81; right-of-use assets increased by RMB 1,491,006,998.14; long-term deferred expenses decreased by RMB 28,446,711.73; other non-current liabilities due within one year increased by RMB 699,372,590.26; lease liabilities increased by RMB 632,866,068.34.

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Parent’s Balance Sheet Unit：RMB

Item	31 December 2020	1 January 2021
Current Assets:
Cash and cash equivalents	56,138,356.37	56,138,356.37
△Settlement reserve
△Due from banks and other financial institutions
Financial assets held for trading	1,630,453.37	1,630,453.37
Derivative Financial assets
Notes Receivable
Accounts Receivable	14,792,320.38	14,792,320.38
Financing receivables
Prepayments
△Premium receivable
△Reinsurance premiun receivable
△Reserve receivable for reinsurance
Other receivables	621,900,443.29	621,900,443.29
Inc: interest receivables
Dividends receivables
△Financial assets purchased under resale agreements
Inventories
Contract assets
Available for sale assets
Non-current assets due within one year
Other current assets
Total current assets	694,461,573.41	694,461,573.41
Non-current assets:
△Loans And Advances
Debt investments
Other debt investments
Long-term receivables

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Item	31 December 2020	1 January 2021
Long-term equity investments	18,582,307,907.14	18,582,307,907.14
Other equity instruments	152,800,000.00	152,800,000.00
Other non-current financial assets
Investment properties	384,641,527.88	384,641,527.88
Fixed assets	383,060,000.00	383,060,000.00
Construction in progress	72,569,103.57	72,569,103.57
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred tax assets	20,529,151.44	20,529,151.44
Other non-current assets	501,095,111.10	501,095,111.10
Total Non-current Assets	20,097,002,801.13	20,097,002,801.13
Total Assets	20,791,464,374.54	20,791,464,374.54
Current liabilities:
Short-term borrowings	871,083,875.00	871,083,875.00
△Borrowings from central bank
△Placement from banks and other financial institutions
Financial liabilities held for trading
Derivative Financial liabilitiels
Notes payable
accounts payable	83,621,752.26	83,621,752.26
Receipts in advance
Contract liabilities
△Financial assets sold under repurchase agreements

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Item	31 December 2020	1 January 2021
△Absorbing deposit and deposit in inter-bank market
△Customer deposits for trading in securities
△Amounts due to issuer for securities underwriting
Employee benefits payable
Taxes payable	1,437,291.71	1,437,291.71
Other payable	446,606,530.72	446,606,530.72
Inc: Interest payables
Dividends payables
△Fees and commissions payable
△Reinsurance accounts payable
Held-for-sale liabilities
Non-current Liabilities due within One Year
Other current liabilities
Total Current Liabilities	1,402,749,449.69	1,402,749,449.69
Non-current Liabilities:
△Deposits for insurance contracts
Long-term borrowings
Bonds payable
Inc: preference share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee benefits payable
Provisions
Deferred Income
Deferred tax liabilities	10,007,613.34	10,007,613.34
Other non-current liabilities
Total Non-current Liabilities	10,007,613.34	10,007,613.34

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Item	31 December 2020	1 January 2021
Total Liabilities	1,412,757,063.03	1,412,757,063.03
Owners'equity:
Paid-in capital (share capital)	6,167,399,389.00	6,167,399,389.00
Other equity instrument
Inc: preference share
Perpetual bond
Capital reserve	12,775,326,370.33	12,775,326,370.33
Deduct: Treasury shares
Other comprehensive income	30,000,000.00	30,000,000.00
Special reserve
Surplus reserve	387,458,806.65	387,458,806.65
△General risk reserve
Retained earnings	18,522,745.53	18,522,745.53
Total Owners' Equity	19,378,707,311.51	19,378,707,311.51
Total Liabilities and Owners' Equity	20,791,464,374.54	20,791,464,374.54

5.Explanation on retrospective adjustment of prior period comparative data under the new lease standard for the first time

The Company adjusted the retained earnings at the beginning of the year and other related items in the financial statements based on the cumulative impacts in accordance with the new lease standards. No adjustments were made to the previous comparative data.

Section VI. Consolidated Financial Statement Project Notes

“The opening balance” refers to the balance on 1 January 2021 and “the closing balance” refers to the balance on 31 December 2021. “The prior period” is the year of 2020 and “The current period” is the year of 2021.

1. Monetary funds

	Item	Closing balance	Opening balance
Cash		62,362.45	67,906.76

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Item Closing	balance Opening balance	balance Opening balance
Bank balances Other currency funds Total	1,756,140,584.62 214,158,325.57 1,970,361,272.64	5,882,201,630.73 68,125,551.63 5,950,395,089.12

Note: 1. Other currency funds mainly include the balance of third-party payment platforms such as POS, Tenpay and Alipay and so on

At the end of the period, there are mortgages, pledges, freezing, and other restricted funds. For details, “ ”

please refer to Note VI (52) Assets with restricted ownership or use rights .

There were no funds deposited overseas at the end of the period.

2. Transactional financial assets

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Financial assets classified as at fair value through profit or loss Including: Debt instrument investment Total	346,726,621.74 346,726,621.74 346,726,621.74	983,205,858.25 983,205,858.25 983,205,858.25

3. Accounts receivable

3.1 Disclosure by aging

Aging Closing balance Opening balance	Aging Closing balance Opening balance	Aging Closing balance Opening balance
Within 1 year (inclusive) 1-2 years (inclusive) Less: Provision for bad debts Total	23,537,021.54 20,016,302.00 3,178,481.27 40,374,842.27	22,622,309.65 2,715.00 1,131,386.99 21,493,637.66

3.2 Classified disclosure by bad debt accrual method

			Closing balance
	Book balance		Bad debt provision
Item
	Amount	Proportion	Amount	Proportion	Book value
		(%)		(%)
Accounts receivables for
	43,553,323.54	100.00	3,178,481.27	7.30	40,374,842.27
which bad debt provision

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Closing balance

Item	Book balance Amount Proportion (%)	Book balance Amount Proportion (%)	Bad debt provision Amount Proportion (%)	Book value
has been assessed by credit risk portfoliosTotal Inc:Combination2 Combination3 Total	3,530,335.54 40,022,988.00 43,553,323.54	8.11 91.89 100.00	176,985.38 5.01 3,001,495.89 7.50 3,178,481.27 --	3,353,350.16 37,021,492.11 40,374,842.27

Continued:

Item	Opening balance Book balance Bad debt provision Amount Proportion (%) Amount Proportion (%)	Opening balance Book balance Bad debt provision Amount Proportion (%) Amount Proportion (%)	Opening balance Book balance Bad debt provision Amount Proportion (%) Amount Proportion (%)	Book value
Accounts receivables for which bad debt provision has been assessed by credit risk portfoliosTotal Inc:Combination2 Combination3 Total	22,625,024.65 2,618,094.65 20,006,930.00 22,625,024.65	100.00 11.57 88.43 100.00	1,131,386.99 5.00 131,040.49 5.01 1,000,346.50 5.00 1,131,386.99 --	21,493,637.66 2,487,054.16 19,006,583.50 21,493,637.66

Accounts receivables for which bad debt provision has been assessed by credit risk portfolios total：

Item Closing balance Accounts Receivable Bad debt provision Proportion (%)	Item Closing balance Accounts Receivable Bad debt provision Proportion (%)	Item Closing balance Accounts Receivable Bad debt provision Proportion (%)
Inc:Combination2 Inc:Combination3 Total	3,530,335.54 40,022,988.00 43,553,323.54	176,985.38 5.01 3,001,495.89 7.50 3,178,481.27 --

3.3 Bad debt provision

Item

Opening

Closing

Changes in the period

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recovery Other Provision Write-off or reversal changes Provision for bad debts of accounts 1,131,386.99 2,047,094.28 3,178,481.27 receivable Total 1,131,386.99 2,047,094.28 3,178,481.27

3.4 Top 5 accounts receivable at the end of the period

Creditor Nature of payment	Closing balance	Bad debt provision Aging Percentage of total accounts receivable（%）	Bad debt provision Aging Percentage of total accounts receivable（%）
Yaxia Industrial Lease payments Customer 1 Hotel service Customer 2 Hotel service Customer 3 Hotel service Customer 4 Hotel service Total	40,000,000.00 1,424,677.50 1,292,261.00 244,856.00 115,703.00 43,077,497.50	2,999,999.99 Within 2 year 71,233.88 Within 1 year 64,613.05 Within 1 year 12,242.80 Within 1 year 5,785.15 Within 1 year 3,153,874.87	91.84 3.27 2.97 0.56 0.27 98.91

4. Prepayments

4.1 Disclosure by aging

Aging Closing balance Amount Proportion	Aging Closing balance Amount Proportion	Aging Closing balance Amount Proportion	Opening balance Amount Proportion	Opening balance Amount Proportion
Within 1 year (inclusive) Total	1,438,350.00 1,438,350.00	100.00 100.00	2,204,120.00 2,204,120.00	100.00 100.00

4.2 Top five entities with the largest balances of prepayments

Creditor Nature of payment	Closing balance Aging Percentage of total advances （%） Bad debt provision	Closing balance Aging Percentage of total advances （%） Bad debt provision
Nanjing Eurasian Air Passenger Transport Agent Co., Ltd Ticket Nanjing Tuniu International Travel Service Co., L Ticket Total	798,055.00 Within 1 year 640,295.00 Within 1 year 1,438,350.00	55.48 44.52 100.00

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5. Other receivables

5.1 Classified listing

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Other receivables Total	219,501,061.83 219,501,061.83	304,318,966.20 304,318,966.20

5.2 Other receivables

5.2.1 Disclosure by aging

Aging Closing balance Opening balance	Aging Closing balance Opening balance	Aging Closing balance Opening balance
Within 1 year (inclusive) 1-2 years (inclusive) 2-3 years (inclusive) 3-4 years (inclusive) 4-5 years (inclusive) Over 5 years Less: Provision for bad debts Total	185,478,538.64 8,746,012.76 11,575,869.13 5,104,417.72 1,769,524.36 13,686,855.19 6,860,155.97 219,501,061.83	267,173,451.40 12,454,633.59 6,657,947.72 1,787,284.88 9,138,241.31 7,995,108.15 887,700.85 304,318,966.20

5.2.2 Other receivables by nature of the payment

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Deposits and guarantees Reserve Disbursement fee and other Total	217,158,729.61 265,275.00 2,077,057.22 219,501,061.83	302,437,947.35 120.00 1,880,898.85 304,318,966.20

5.2.3 Withdrawing process of bad debt provision

			The first stage	second stage	The third stage
Bad	debt	provision	Expected credit	Expected credit loss for the entire	Expected credit losses for the entire	Total
			losses in the
			next 12 months	duration (no	duration (credit
				credit impairment	impairment loss has

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			loss) occurred)	loss) occurred)
Balance as of 1 January 2021 Balance of other receivables on 1 January 2021 during the current period ——transferred to stage 2 ——transferred to stage 3 ——transferred back stage 2 ——transferred back to stage 1 Provision during the current period Reversal during the current period Resale during the current peirod Wrtie-off during the current period Other changes Balance as of 31 December 2021 5.2.4 Situation of bad debt provision Item Opening balance Provision for bad debts of other receivables 887,700.85 Total 887,700.85			377,400.85 510,300.00 887,700.85 6,482,755.12 6,482,755.12 510,300.00 510,300.00 6,860,155.97 6,860,155.97 Changes in the period Closing balance Provision recovery or reversal Write-off Other changes 6,482,755.12 510,300.00 6,860,155.97 6,482,755.12 510,300.00 6,860,155.97
	Provision for bad debts of other receivables Total	887,700.85 887,700.85	6,482,755.12 6,482,755.12	510,300.00 510,300.00

5.2.5 Other receivables actually written-off during the reporting period

Item	Amount charge off
Other receivables actually written-off	510,300.00

5.2.6 Top 5 other receivable at the end of the period

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Creditor Nature of payment	Closing balance Aging Percentage of total other receivables (%)	Closing balance of bad debt provision
Beijing Construction Engineering Real Estate Co., Ltd Deposits and guarantees Beijing Huaxia Shunxin Property Management Co., Ltd Deposits and guarantees Hainan Gahexin Technology Co., Ltd Deposits and guarantees Shenyang Lijing Pearl Hotel Management Co., Ltd Deposits and guarantees Harbin Yuheng Pharmaceutical Co., Ltd Deposits and guarantees Total 6. Non-current assets due within one year Debt investment due within one year Total	124,498,000.00 Within 1 year 55.00 6,224,900.00 25,000,000.00 Within 1 year 11.04 15,000,000.00 Within 1 year 6.63 5,675,200.00 Over 5 years 2.51 3,961,093.75 Within 1 year Over 5 years 1.75 174,134,293.75 76.93 6,224,900.00 Item Closing balance Opening balance 1,985,873,462.75 1,985,873,462.75

7. Other current assets

Item Closing balance Opening	Item Closing balance Opening	balance
Pending payment Advance tax Prepaid expenses Total	12,833,701.81 13,869,795.74 10,255,632.25 36,959,129.80	41,832,345.30 3,025,677.50 44,858,022.80

8. Debt investment

Item Closing balance Book balance Impairment provision	Item Closing balance Book balance Impairment provision	Opening balance Book value Book balance Impairment provision Book value
Time deposit Total	7,058,993.55 7,058,993.55	7,058,993.55 7,058,993.55

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9. Long-term equity investment

The invested entity Opening balance	Increase	Changes for the year Decrease Investment profit under equity method Other comprehensive income adjustment Other equity change Cash dividends or profits announced of issuance Provision for impairment Others	Changes for the year Decrease Investment profit under equity method Other comprehensive income adjustment Other equity change Cash dividends or profits announced of issuance Provision for impairment Others	Closing balance Closing balance of provision for impairment
II.Associates Beijing Zhongwang Future Education Technology Co., Ltd Total	100,000,000.00 100,000,000.00	51,000,000.00 51,000,000.00	-2,149,635.60 -2,149,635.60	46,850,364.40 46,850,364.40

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10. Other equity investment

10.1 Other equity investment

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Shanghai Zuihuibao Network Technology Co., Ltd. Anhui Ningguo Rural Commercial Bank Co., Ltd. Total	103,600,000.00 26,800,000.00 130,400,000.00	126,000,000.00 26,800,000.00 152,800,000.00

10.2 Investment in non-trading equity instruments

Item	Recognized dividend income	Cumulative gain Accumulated loss Amount of other comprehensive income transferred to retained earnings Reasons for the designation as being measured at fair value and the change included in other comprehensive income Reasons for transferring other comprehensive income to retained earnings
Shanghai Zuihuibao Network Technology Co., Ltd. Anhui Ningguo Rural Commercial Bank Co., Ltd. Total	1,327,872.00 1,327,872.00	17,600,000.00 Plan for long-term holding Plan for long-term holding 17,600,000.00

11. Other non-current financial assets

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Beijing Jinwu Venture Capital Center (Limited Partnership) Financial product Total	30,260,000.00 30,260,000.00	38,050,000.00 170,400,315.01 208,450,315.01

12. Investment property

12.1Investment real estate measurement model

Investment real estate with cost measurement model :

	Houses and	Land use
Item			Total
	buildings	rights

1.Original carrying amount

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Item
Houses and
buildings
Land use
rights

Total

1.1 Opening balance
377,111,222.22
473,825,849.87
1.2 Increase in the current period
1.3 Decrease in the current period
3,201,828.13
1.3.1 Disposal
3,201,828.13
1.4 Closing balance
377,111,222.22
470,624,021.74
2. Accumulated depreciation and
amortization
2.1 Opening balance
50,891,399.79
71,833,552.56
2.2 Increase in the current period
9,000,262.93
11,354,161.39
2.2.1 Accrual or amortization
9,000,262.93
11,354,161.39
2.3 Decrease in the current period
478,278.09
2.3.1 Disposal
478,278.09
2.4 Closing balance
59,891,662.72
82,709,435.86
3. Provision for impairment
3.1 Opening balance
6,556,268.55
53,641,335.37
3.2 Increase in the current period
3.3 Decrease in the current period
3.4 Closing balance
6,556,268.55
53,641,335.37
4.Book value
4.1 Closing balance
310,663,290.95
334,273,250.51
4.2 Opening balance
319,663,553.88
348,350,961.94

850,937,072.09
3,201,828.13
3,201,828.13
847,735,243.96
122,724,952.35
20,354,424.32
20,354,424.32
478,278.09
478,278.09
142,601,098.58
60,197,603.92
60,197,603.92
644,936,541.46
668,014,515.82

12.2 The situation of investment real estate that has not completed the property right certificate

Item	Closing balance	Reasons for not completing the property right certificate
Houses and buildings	263,850,928.19	In progress
Land use rights	5,149,979.01	In progress

13. Fixed assets

13.1 Presentation

Item Closing balance Opening	Item Closing balance Opening	balance
Fixed assets Total	1,770,372,338.85 1,770,372,338.85	1,612,792,592.67 1,612,792,592.67

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13.2 Fixed assets

13.2.1 Fixed assets situation

Item
Houses and
buildings
Decoration of
fixed assets
Transportatio
n equipment
Electronic
equipment
Office
equipment

Total

I.Original carrying
amount
1.Opening balance
1,554,597,283.39
64,708,424.02
79,864,456.42
221,718,295.47
12,041,667.21
1.2 Increase in the
current period
243,690,788.14
733,750.00
13,566,679.73
39,376.40
1.2.1 Purchase
9,798,328.75
733,750.00
13,566,679.73
39,376.40
1.2.2 Other increases
233,892,459.39
1.3 Decrease in the
current period
632,059.91
1.3.1 Disposal or
scrap
632,059.91
1.4 Closing balance
1,798,288,071.53
64,708,424.02
79,966,146.51
235,284,975.20
12,081,043.61
II.Accumulated
depreciation
2.1 Opening balance
95,350,935.18
23,777,361.06
67,037,779.49
123,219,503.77
10,672,970.00
2.2 Increase in the
current period
53,479,752.98
9,836,387.16
4,203,652.49
32,178,961.58
359,845.02
2.2.1 Provision
53,479,752.98
9,836,387.16
4,203,652.49
32,178,961.58
359,845.02
2.3 Decrease in the
current period
239,811.05
2.3.1 Disposal or
scrap
239,811.05
2.4 Closing balance
148,830,688.16
33,613,748.22
71,001,620.93
155,398,465.35
11,032,815.02
III. Provision for
impairment
3.1 Opening balance
4,309.80
74,674.54
3.2 Increase in the
current period
3.3 Decrease in the
current period
3.4 Closing balance
4,309.80
74,674.54
IV. Book value
4.1 Closing balance
1,649,457,383.37
31,094,675.80
8,964,525.58
79,882,200.05
973,554.05

1,932,930,126.51
258,030,594.27
24,138,134.88
233,892,459.39
632,059.91
632,059.91
2,190,328,660.87
320,058,549.50
100,058,599.23
100,058,599.23
239,811.05
239,811.05
419,877,337.68
78,984.34
78,984.34
1,770,372,338.85

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Item Houses and buildings Decoration of fixed assets Transportatio n equipment Electronic equipment Office equipment	Total
4.2 Opening balance 1,459,246,348.21 40,931,062.96 12,826,676.93 98,494,481.90 1,294,022.67	1,612,792,592.67

Note: Other increases are due to the acquisition of Lu'an Yazhong Real Estate Information Consulting Co., Ltd. and Lu'an Zhongke Real Estate Information Consulting Co., Ltd. in the current period.

13.2.2 The situation of fixed assets that have not completed the title certificate

Item	Carrying amount	Reasons for not completing the property right certificate
Houses and buildings	371,414,975.96	In progress

14. Construction in progress

14.1 Master list

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Construction in progress Total	294,785,678.31 294,785,678.31	214,248,125.04 214,248,125.04

14.2 Construction in progress

14.2.1 Construction in progress

Item	Closing balance Book balance Impairment provision	Book value	Opening balance Book balance Impairment provision Book value	Opening balance Book balance Impairment provision Book value
Offcn Fushun Building Rizhao Learning City Yaxia Bozhou Fortune Plaza GAC-Toyota Bozhou 4S Stores Huangshan Fudi Stores Total	157,099,898.91 63,725,345.88 62,847,721.95 9,721,381.62 1,391,329.95 294,785,678.31	157,099,898.91 63,725,345.88 62,847,721.95 9,721,381.62 1,391,329.95 294,785,678.31	140,287,691.52 62,847,721.95 9,721,381.62 1,391,329.95 214,248,125.04	140,287,691.52 62,847,721.95 9,721,381.62 1,391,329.95 214,248,125.04

14.2.2 Changes in important construction projects in the current period

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Item	Budget amount	Opening balance Increase in the current period Transfer to fixed assets Other decreases	Closing balance
Continued： Amount injected as a proportion of budget amount (%) Construction progress (%) Amount of accumulated capitalized interest Including: capitalized interest for the period Interest capitalization rate for the period (%) Offcn Fushun Building 330,000,000.00 140,287,691.52 16,812,207.39 Rizhao Learning City 1,000,000,000.00 63,725,345.88 Total 1,330,000,000.00 140,287,691.52 80,537,553.27			Source of funds 157,099,898.91 63,725,345.88 220,825,244.79
47.61 47.61 6.37 6.37 -- --			self-funds self-funds

15. Right-of-use assets

Item
Houses and buildings

Total

1.Original carrying amount
1.1 Opening balance
1,491,006,998.14
1.2 Increase in the current period
368,668,630.21
1.2.1 Add a lease contract
368,668,630.21
1.3 Decrease in the current period
73,601,114.44
1.3.1 Lease expiry
58,175,992.36
1.3.2 Expires early
15,425,122.08
1.4 Closing balance
1,786,074,513.91
2. Accumulated amortization
1.Opening balance
503,643,895.04
2.2 Increase in the current period
503,643,895.04
2.2.1 Provision
59,849,768.21
2.3 Decrease in the current period
58,175,992.36
2.3.1 Lease expiry
1,673,775.85
2.3.2 Expires early
443,794,126.83
2.4 Closing balance
503,643,895.04

1,491,006,998.14
368,668,630.21
368,668,630.21
73,601,114.44
58,175,992.36
15,425,122.08
1,786,074,513.91
503,643,895.04
503,643,895.04
59,849,768.21
58,175,992.36
1,673,775.85
443,794,126.83
503,643,895.04

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Item
Houses and buildings
Total
3. Impairment provision
3.1 Opening balance
3.2 Increase in the current period
3.3 Decrease in the current period
3.4 Closing balance
4. Book value
4.1 Closing balance
1,342,280,387.08
1,342,280,387.08
4.2 Opening balance
1,491,006,998.14
1,491,006,998.14
16. Intangible assets
16.1 Intangible assets
Item
Land use rights
Software use rights
Trademark rights
Total

1.Original carrying amount
1.1 Opening balance
446,725,693.93
7,774,286.02
7,140,521.53
1.2 Increase in the current period
463,327,047.50
1.2.1 Purchase
136,098,747.50
1.2.2 Other increases
327,228,300.00
1.3 Decrease in the current period
1.4 Closing balance
910,052,741.43
7,774,286.02
7,140,521.53
2. Accumulated amortization
1.Opening balance
29,028,132.73
3,810,053.83
2,446,748.17
2.2 Increase in the current period
21,616,899.76
706,888.17
728,165.47
2.2.1 Provision
21,616,899.76
706,888.17
728,165.47
2.3 Decrease in the current period
2.4 Closing balance
50,645,032.49
4,516,942.00
3,174,913.64
3. Impairment provision
3.1 Opening balance
3,111.00
3.2 Increase in the current period
3.3 Decrease in the current period
3.4 Closing balance
3,111.00
4. Book value
4.1 Closing balance
859,407,708.94
3,254,233.02
3,965,607.89
4.2 Opening balance
417,697,561.20
3,961,121.19
4,693,773.36

461,640,501.48
463,327,047.50
136,098,747.50
327,228,300.00
924,967,548.98
35,284,934.73
23,051,953.40
23,051,953.40
58,336,888.13
3,111.00
3,111.00
866,627,549.85
426,352,455.75

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Note: Other increases are due to the acquisition of Lu'an Yazhong Real Estate Information Consulting Co., Ltd. and Lu'an Zhongke Real Estate Information Consulting Co., Ltd. in the current period.

16.2 Land use right without property certification held

Item Closing balance Reasons for not completing the property right certificate Land use rights 257,463,145.70 In progress 17. Goodwill 17.1 Original book value of goodwill Name of the investee and item resulting in goodwill Opening balance Increase in the current period Decrease in the current period Closing balance Formed by business combination others Dispose others Shandong Kunzhong Real Estate Co., Ltd. 39,378,573.51 39,378,573.51 Nanjing Huiyue Hotel Management Co., Ltd. 60,489,146.87 60,489,146.87 Total 99,867,720.38 99,867,720.38	Item Closing balance Reasons for not completing the property right certificate	Item Closing balance Reasons for not completing the property right certificate	Item Closing balance Reasons for not completing the property right certificate
			In progress Closing balance
	Shandong Kunzhong Real Estate Co., Ltd. Nanjing Huiyue Hotel Management Co., Ltd. Total	39,378,573.51 60,489,146.87 99,867,720.38	39,378,573.51 60,489,146.87 99,867,720.38

17.2 Goodwill impairment provision

None.

17.3 Relevant information of asset group or combination of asset group where goodwill is located

The company acquired Shandong Kunzhong Real Estate Co., Ltd. in 2016 and generated goodwill of RMB 39,378,573.51. The goodwill was divided into corresponding asset groups with a book value of RMB 178,960,953.83. The recoverable amount of the asset group is determined based on the net amount of the fair value minus the disposal expenses.

The company's acquisition of Nanjing Huiyue Hotel Management Co., Ltd. in 2018 generated goodwill of RMB 60,489,146.87, which was divided into corresponding asset groups with a book value of RMB 188,191,547.68. The recoverable amount of the asset group is determined based on the net amount of the fair value minus the disposal expenses.

17.4.Goodwill impairment testing process, key parameters and confirmation method of goodwill impairment loss

The method of provision for impairment is detailed in Note III (25) Impairment of long-term assets.

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The recoverable amount of the company's asset group including goodwill is estimated by using the net amount of the fair value of the asset group in which the goodwill is located less the disposal costs. As the main assets have a fair value that can be referred to in the market, the market comparison method is used to estimate the fair value of the base date of the assets to be estimated, taking into account differences in time, transaction, regional and individual factors. For other assets, combined with the actual situation of assets, the cost method is adopted to determine the fair value of the assets to be appraised on the base date .The company entrusted an asset assessment company to conduct an impairment test on goodwill. After testing, no goodwill was found to be impaired, and no provision for impairment was made.

18. Long-term prepaid expenses

Item	Opening balance	Increase in the period	Amortization for the period Other reductions	Closing balance
Decoration expenditure Other Total	400,291,298.64 12,217,367.56 412,508,666.20	35,524,590.00 1,402,059.83 36,926,649.83	66,684,829.78 2,559,479.87 69,244,309.65	369,131,058.86 11,059,947.52 380,191,006.38

19. Deferred income tax assets and Deferred income tax liabilities

19.1 Unoffset deferred income tax assets

Item	Closing balance Deductible temporary differences Deferred tax assets	Closing balance Deductible temporary differences Deferred tax assets	Opening balance Deductible temporary differences Deferred tax assets	Opening balance Deductible temporary differences Deferred tax assets
Provision for impairment losses of assets Deductible losses Changes in fair value of held-for-trading financial assets Total	7,097,408.69 2,816,982,346.58 2,240,000.00 2,826,319,755.27	1,143,919.39 422,547,351.99 336,000.00 424,027,271.38	1,879,621.51 84,774,502.49 86,654,124.00	412,811.14 21,193,625.63 21,606,436.77

19.2 Unoffset deferred income tax liabilities

Item

Closing balance

Opening balance

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	Taxable temporary difference	Deferred income tax liabilities	Taxable temporary difference	Deferred income tax liabilities
Appraisal and Appreciation of Consolidated Assets of Non-identical Controlled Enterprises Changes in fair value of other equity instrument investments Changes in fair value of financial assets held for trading Total	355,061,963.00 17,600,000.00 3,446,850.74 376,108,813.74	88,765,490.76 4,400,000.00 546,681.86 93,712,172.62	365,183,429.96 40,000,000.00 22,697,173.26 427,880,603.22	91,295,857.49 10,000,000.00 3,381,587.10 104,677,444.59

19.3 Unrecognized deferred income tax asset details

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Deductible losses Deductible temporary difference Total	261,754,607.89 2,801,762.22 264,556,370.11	55,733,407.18 221,561.67 55,954,968.85

19.4 The deductible losses of unrecognized deferred income tax assets will expire in the following years

Year Closing balance Opening	Year Closing balance Opening	balance
2021 2022 2023 2024 2025 2026 Total	14,669,961.10 11,480,964.23 38,853,304.84 57,109,818.13 139,640,559.59 261,754,607.89	10,989,030.45 119,383.82 11,480,964.23 9,975,369.01 23,168,659.67 55,733,407.18

20. Other non-current assets

					Closing balance			Opening balance
Item			Book balance	Impairment	Book value	Book balance	Impairment	Book value
				provision			provision
Prepayment	for	Fixed	1,630,946,885.38		1,630,946,885.38
Assets

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Item	Book balance Impairment provision	Closing balance Book value	Opening balance Book balance Impairment provision Book value	Opening balance Book balance Impairment provision Book value
Input tax to be deducted / to be certified Prepaid construction payments Investment funds Prepaid land payments Total	11,962,352.40 8,455,158.00 800,000.00 1,652,164,395.78	11,962,352.40 8,455,158.00 800,000.00 1,652,164,395.78	13,707,312.81 35,584,390.50 500,800,000.00 601,000,000.00 1,151,091,703.31	13,707,312.81 35,584,390.50 500,800,000.00 601,000,000.00 1,151,091,703.31

21. Short-term loan

Short-term loan classification

term loan classification
Item	Closing balance	Opening balance
Credit loans	3,152,945,812.59	3,496,251,279.22
Pledge loans		479,768,050.00
Total	3,152,945,812.59	3,976,019,329.22
2. Accounts payable
accounts payable
Item	Closing balance	Opening balance
Start class fees	109,756,452.70	47,005,391.45
Fixed assets	83,112,000.00	83,112,000.00
Project payments	51,080,172.01	53,138,461.93
Renovation costs	22,461,110.93	11,312,336.01
Market promotion fees	15,623,180.88	12,918,597.97
Rent and property fees		4,337,615.50
Total	282,032,916.52	211,824,402.86
3. Contract liabilities
ary of contract liabilities
Item	Closing balance	Opening balance
Training fees received in advance	3,063,247,467.84	4,925,351,396.44
Other	473,822.44	76,912.89

22. Accounts payable

List of accounts payable

23. Contract liabilities

Summary of contract liabilities

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Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Total	3,063,721,290.28	4,925,428,309.33

24. payroll payable

24.1 List of employee salaries payable

Item	Opening balance	Increase	Decrease	Closing balance
I. Short-term salary II.Post-employment welfare- defined contribution plan liability III. Dismissed welfare Total 4.2 Short-term salary list Item	636,827,645.79 620,788.20 637,448,433.99 Opening balance	5,753,275,600.55 372,679,188.11 885,604.94 6,126,840,393.60 Increase	5,983,922,630.72 356,633,735.33 845,604.94 6,341,401,970.99 Decrease	406,180,615.62 16,666,240.98 40,000.00 422,886,856.60 Closing balance
I. Wages or salaries, bonuses, allowances and subsidies II. Staff welfare III. Social security contributions Inc: 1.Medical insurance 2. Work injury insurance 3. Maternity insurance IV. Housing fund V. Labor union expenditure and employee education expenditure Total	628,829,674.62 6,950,840.17 6,934,136.71 3,575.24 13,128.22 1,041,581.00 5,550.00 636,827,645.79	5,373,626,145.61 11,990,933.07 220,714,436.79 206,998,124.98 7,945,142.66 5,771,169.15 146,786,598.68 157,486.40 5,753,275,600.55	5,602,712,023.21 11,990,933.07 221,895,581.98 208,552,743.83 7,558,746.97 5,784,091.18 147,161,297.68 162,794.78 5,983,922,630.72	399,743,797.02 5,769,694.98 5,379,517.86 389,970.93 206.19 666,882.00 241.62 406,180,615.62

24.2 Short-term salary list

24.3 Set deposit plan listing

Item	Opening balance	Increase	Decrease	Closing balance
I. Basic endowment insurance	600,449.08	359,511,711.59	344,052,854.92	16,059,305.75

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Item Opening balance	Item Opening balance	Increase	Decrease Closing balance	Decrease Closing balance
II. Unemployment insurance Total	20,339.12 620,788.20	13,167,476.52 372,679,188.11	12,580,880.41 356,633,735.33	606,935.23 16,666,240.98

24.4 Dismissed welfare

Item Amount of current payments Amount due but not yet paid	Item Amount of current payments Amount due but not yet paid	Item Amount of current payments Amount due but not yet paid
Compensation for termination of employment Total	845,604.94 845,604.94	40,000.00 40,000.00

25. Taxes payable

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
1. Corporate income tax 2. Land use tax 3. Property tax 4. Value-added tax 5. Withholding individual income tax 6. City maintenance and construction tax 7. Education surcharge 8. Other Total	7,200,408.21 2,064,992.60 1,604,934.51 1,258,114.36 227,163.18 84,830.67 37,072.06 89,236.25 12,566,751.84	119,249,068.60 806,176.59 1,251,091.59 8,571,895.29 160,427.08 549,182.28 238,219.17 285,710.18 131,111,770.78

26. Other payable

26.1 Master list

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Other payable Total	129,043,599.22 129,043,599.22	9,479,383.03 9,479,383.03

26.2 Other payables

	Item	Closing balance	Opening balance
Equity transfer		61,283,300.00
Daily expenses		58,363,407.47	1,597,271.61

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Item Closing	balance Opening balance	balance Opening balance
Social Security and Provident Fund Advances and others Total	683,275.40 8,713,616.35 129,043,599.22	924,969.11 6,957,142.31 9,479,383.03

27. Non-current liabilities due within one year

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Lease liabilities due within one year Total	531,876,007.31 531,876,007.31	699,372,590.26 699,372,590.26

28. Other current liabilities

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Value-added tax received in advance Total	91,925,853.39 91,925,853.39	147,765,156.66 147,765,156.66

29. Lease liabilities

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Houses and buildings Total	635,691,184.87 635,691,184.87	632,866,068.34 632,866,068.34

30. Share capital

Changes in the current period （ + 、 - ）

Item	Opening balance	Issue new	Bonus	Provident fund transfer to share	Closing balance
			share
		shares		capital
Share
	103,807,623.00				103,807,623.00
capital

31. Capital reserve

Item	Opening balance Increase Decrease	Closing balance
Equity premium Total	1,225,481,049.50 1,225,481,049.50	1,225,481,049.50 1,225,481,049.50

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32. Other comprehensive income

Item	Opening balance	Amount incurred in this period Pre-tax amount for the year Less: transferred to other comprehensive income in the previous period and transferred to profit or loss in the current period Less: transferred to other comprehensive income in the previous period and transferred to retained earnings in the current period Less: income tax expenses	Amount incurred in this period Pre-tax amount for the year Less: transferred to other comprehensive income in the previous period and transferred to profit or loss in the current period Less: transferred to other comprehensive income in the previous period and transferred to retained earnings in the current period Less: income tax expenses	Attributable to the parent company, after tax Attributable to minority shareholders , after tax	Closing balance
1. Other comprehensive income not reclassfied into gains or losses Changes in the fair value of other equity instruments 2. Other comprehensive income classified into gains or losses Total	30,000,000.00 30,000,000.00 30,000,000.00	-22,400,000.00 -22,400,000.00 -22,400,000.00	-5,600,000.00 -5,600,000.00 -5,600,000.00	-16,800,000.00 -16,800,000.00 -16,800,000.00	13,200,000.00 13,200,000.00 13,200,000.00

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33. Surplus reserve

Item Opening balance Increase Decrease Closing balance	Item Opening balance Increase Decrease Closing balance	Item Opening balance Increase Decrease Closing balance
Statutory surplus reserve Total	45,000,000.00 45,000,000.00	45,000,000.00 45,000,000.00

34. Undistributed profit
Item	Amount for the current	Amount for the prior
	period	period
Undistributed profits at the end of previous year	2,870,839,120.70	2,046,657,231.32
Adjusting undistributed profits at the beginning of the
period(Increase +, decrease-)
Undistributed profits at the beginning of the year	2,870,839,120.70	2,046,657,231.32
Add: net profit attributable to owners of the Parent Company	-2,369,509,039.00	2,304,357,742.74
Less: appropriation of statutory surplus reserve
Appropriation of arbitrary surplus reserves
Dividend payable for ordinary shares		1,480,175,853.36
Other
Undistributed profits at the end of period	501,330,081.70	2,870,839,120.70

35. Operating income and operating costs

Item Amount for the current period Amount for the prior period Operating income Operating costs Operating income Operating costs	Item Amount for the current period Amount for the prior period Operating income Operating costs Operating income Operating costs	Item Amount for the current period Amount for the prior period Operating income Operating costs Operating income Operating costs	Item Amount for the current period Amount for the prior period Operating income Operating costs Operating income Operating costs	Item Amount for the current period Amount for the prior period Operating income Operating costs Operating income Operating costs
Prime operating income Including:Education and Training Other business Total	6,860,282,371.30 6,860,282,371.30 51,440,960.49 6,911,723,331.79	4,945,732,913.85 4,945,732,913.85 47,984,449.73 4,993,717,363.58	11,138,901,718.71 11,138,901,718.71 63,592,576.33 11,202,494,295.04	4,513,636,084.16 4,513,636,084.16 53,690,847.28 4,567,326,931.44

36. Taxes and surcharges

	Item	Amount for the current period	Amount for the prior period
Land holding tax		11,321,827.24	3,381,103.73

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Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
City maintenance and construction tax Property tax Education surcharge Stamp tax Vehicle usage tax Other Total	8,522,400.03 7,049,854.14 6,082,104.43 1,767,176.26 206,086.78 405,720.86 35,355,169.74	763,262.32 6,616,408.91 541,844.53 844,498.27 219,798.99 371,797.88 12,738,714.63

37. Sales expenses

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Employee's salary Marketing fee Rent property and depreciation amortization Travel expenses Other Total 8. Management expenses Item Amount for the		1,483,858,537.49 1,236,069,387.65 270,366,194.33 278,829,823.86 223,882,255.51 188,443,486.90 113,757,589.64 99,197,672.77 13,234,335.09 9,249,741.98 2,105,098,912.06 1,811,790,113.16 current period Amount for the prior period
Employee's salary Rental property and depreciation amortization Office expenses Travel expenses Welfare fee Share payments Other Total	895,338,308.25 189,782,209.74 123,857,061.80 67,023,692.53 8,856,771.23 30,784,978.48 1,315,643,022.03		860,224,894.29 155,909,891.20 116,671,846.80 62,125,639.40 8,559,890.15 26,900,000.00 49,477,045.53 1,279,869,207.37

38. Management expenses

39. Research and development expenses

Item Amount for the current period Amount for the prior period

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Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Employee's salary Travel expenses Other Total	821,900,871.61 27,128,292.82 52,440,374.14 901,469,538.57	980,101,934.22 23,799,305.33 46,796,094.24 1,050,697,333.79

40. Financial expenses

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Interest expenses Less: Interest income Service Charge Total	274,734,405.81 58,235,304.20 275,115,370.37 491,614,471.98	172,114,852.12 33,148,136.69 291,581,973.74 430,548,689.17

41. Other income

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
VAT exemption Financial support Stable subsidy Small financial support income Rent subsidy income Tax handling fee refund Land use tax incentives Park support and subsidy Total 2. Investment income Item	68,480,064.80 313,855,441.46 20,000,000.00 6,034,820.96 19,123,806.18 1,187,768.87 151,606.91 273,750.00 268,680.00 107,735.71 1,746,734.22 444,804.00 120,000.00 96,084,140.34 335,711,072.77 Amount for the current period Amount for the prior period
Long-term equity investments income under equity method Investment income from disposal of long-term equity investments Dividend income obtained during the holding period of	-2,149,635.60 26,620.33 1,327,872.00 249,600.00

42. Investment income

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Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
other equity instrument investments Interest income obtained during the period of debt investment holding Investment income from Financial product Gains arising from remeasurement of remaining equity at fair value after loss of control Total	23,083,807.21 56,955,660.58 25,576.40 79,269,900.92	76,070,548.08 180,223,310.57 256,543,458.65

43. Fair value change income

Item Amount for the current period Amount for the prior period Tradable financial assets -21,490,322.52 20,984,385.76 Total -21,490,322.52 20,984,385.76 44. Expected credit loss Item Amount for the current period Amount for the prior period Accounts receivable bad debt losses -2,047,094.28 -988,142.88 Other receivables bad debt -6,482,755.12 -182,909.95 Total -8,529,849.40 -1,171,052.83	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Accounts receivable bad debt losses Other receivables bad debt Total		-2,047,094.28 -6,482,755.12 -8,529,849.40

45. Asset disposal income

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Fixed assets Total	-163,075.82 -163,075.82	162,043.59 162,043.59

46. Non-operating income

			Amount included in
	Amount for the	Amount for the
Item	current period	prior period	current non-recurring profit and loss
Liquidated damages income	18,141,095.89		18,141,095.89
gains from disposal of fixed assets		44,705.00

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Item Amount for the current period Amount for the prior period Amount included in current non-recurring profit and loss	Item Amount for the current period Amount for the prior period Amount included in current non-recurring profit and loss	Item Amount for the current period Amount for the prior period Amount included in current non-recurring profit and loss	Item Amount for the current period Amount for the prior period Amount included in current non-recurring profit and loss
Government subsidy 19,800.00 Other 798.00 Total 18,141,095.89 65,303.00 18,141,095.89 7. Non-operating expenses Item Amount for the current period Amount for the prior period Amount included in current non-recurring profit and loss
Fixed assets disposal losses Forfeiture and Late Payments External donation Compensation expenses Total	5,264.50 833,516.13 415,001.84 50,000.00 1,303,782.47	365,792.85 305,003.50 3,845.50 674,641.85	5,264.50 833,516.13 415,001.84 50,000.00 1,303,782.47

47. Non-operating expenses

48. Income tax expense

48.1 Statement of income tax expense

Item	Amount for the current period	Amount for the prior period
Income tax expenses	-399,652,322.88	356,812,108.72
Inc: Current tax expense	8,133,783.70	356,690,541.80
Deferred tax expense	-407,786,106.58	121,566.92

48.2 Accounting profit and income tax expense adjustment process

	Item					Amount for the	Amount for the prior
						current period	period
Total profit						-2,769,167,039.23	2,661,143,874.57
Income tax expenses calculated statutory/applicable tax rate(s)				pursuant	to	-415,375,055.88	399,171,581.19
Impact from	different tax rates applicable			to subsidiaries		-5,079,231.58	-6,991,306.55
Impact from	adjustment to income		tax in prior periods			604,294.24	-13,895.40
Profit and	loss attributable	to	joint	ventures	and	537,408.90
associates
Impact of non-taxable income						-331,968.00	-62,400.00
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Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Impact from non-deductible cost, expense and loss Tax deduction Impact from using deductible losses of previously unrecognized deferred income tax assets The effect of deductible temporary differences or deductible losses of deferred income tax assets not recognized in the current period Income tax expenses	4,510,631.06 -30,794,981.36 -611,337.11 46,887,916.85 -399,652,322.88	5,245,057.55 -45,107,330.97 -78,416.71 4,648,819.61 356,812,108.72

49. Other comprehensive income items and their income tax impact and transfer-in profit and loss

See this report for details Note “Ⅵ (32) Other comprehensive income”.

50. Items in cash flow statement

50.1 Other cash receipts relating to operating activities

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Deposits and guarantees Interest income Other income and non-operating income Disbursement fee and othe Reserve Capital occupation fee Total	67,046,115.88 58,235,304.20 45,745,171.43 794,866.26 120,357.15 171,941,814.92	206,647,643.62 33,148,136.69 22,576,746.74 1,548,933.16 5,313,917.82 13,324,109.00 282,559,487.03

50.2 Other cash payments relating to operating activities

Item	Amount for the current period	Amount for the prior period
Daily expenses	701,531,709.86	1,015,974,942.08
Service Charge	218,115,370.37	291,248,494.89
Deposits and guarantees	197,610,304.93	70,688,933.00
Non-operating expenses	1,303,782.47	674,641.85
Disbursement fee and other	462,284.22
Reserve	385,512.15	5,480,802.14

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Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Total	1,119,408,964.00	1,384,067,813.96

50.3 Other cash receipts relating to investing activities

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Engineering deposit Total	200,000,000.00 200,000,000.00

50.4 Other cash payments relating to investing activities

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Engineering deposit Total	200,000,000.00 200,000,000.00

50.5 Other cash receipts relating to financing activities

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Equity distribution margin Total	1,000,000.00 1,000,000.00

50.6 Other cash payments relating to financing activities

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Cash paid to repay principal and interest on lease liability Equity distribution margin Dividend handling fee Total	606,571,985.34 606,571,985.34	1,000,000.00 333,478.85 1,333,478.85

51. Supplementary Information on Cash Flow Statement

51.1 Supplementary Information on Cash Flow Statement

Additional materials

Amount for the current	Amount for the prior
period	period

Reconciliation of net profit to cash flow from

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Additional materials		Amount for the current	Amount for the prior
		period	period
operating activities:
Net profit		-2,369,514,716.35	2,304,331,765.85
Add: Provision for impairment losses of assets
Credit impairment loss		8,529,849.40	1,171,052.83
Depreciation of fixed assets, depletion of oil and gas assets, depreciation of bearer biological assets		120,413,023.55	88,365,469.55
Amortization of right-of-use assets		503,643,895.04
Amortization of intangible assets		20,823,493.07	12,694,728.51
Amortization of long-term prepaid expenses		66,684,829.78	62,457,211.00
Losses/(gains) on disposal of fixed	assets,	163,075.82	-162,043.59
intangible assets and other long-term asset
Losses /(gains) on write-off of fixed assets		5,264.50	-44,705.00
Losses/(gains) on changes in fair values		21,490,322.52	-20,984,385.76
Financial expenses/ (income)		274,734,405.81	172,448,330.97
Losses/(gains) arising from investments		-79,269,900.92	-256,543,458.65
Decrease /(increase) in deferred tax assets		-402,420,834.61	-123,604.64
Increase/(decrease) in deferred tax liabilities		-5,365,271.97	245,171.56
Decrease /(increase) in inventories
Decrease /(increase) in receivables from		-172,950,120.86	107,621,688.58
operating activities
Increase/(decrease) in payables from operating		-2,084,928,863.68	2,384,091,880.70
activities
Others			26,900,000.00
Net cash flow from operating activities		-4,097,961,548.90	4,882,469,101.91
2.Significant investing and financing activities	that do
not involve cash flow
Conversion of debt into capital
Reclassification of current portion of convertible
bonds to current liabilities
Fixed assets capitalized under finance lease
3. Net changes in cash and cash equivalents:
Closing balance of cash		1,969,806,009.56	5,950,036,489.12
Less: Opening balance of cash		5,950,036,489.12	2,724,335,001.58
Add: Closing balance of cash equivalents

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Additional materials	Amount for the current	Amount for the prior
	period	period
Less: Opening balance of cash equivalents
Net increase in cash and cash equivalents	-3,980,230,479.56	3,225,701,487.54

51.2 Net Cash receive of disposal of the subsidiary

Item	Amount
Disposal of cash or cash equivalents received by subsidiaries in the current period	51,000,000.00
Including:Beijing Zhonggong Future Education Technology Co., Ltd.	51,000,000.00
Less: Cash and cash equivalents held by the company on the date of loss of control
Add:Cash or cash equivalents received in the current period from disposals of
subsidiaries in previous periods
Net cash received from disposal of subsidiaries	51,000,000.00

51.3. Composition of Cash and Cash Equivalents

Item	Closing balance	Opening balance
I. Cash	1,969,806,009.56	5,950,036,489.12
Including: Cash on hand	62,362.45	67,906.76
Bank deposits	1,755,585,321.54	5,881,843,030.73
Other monetary funds	214,158,325.57	68,125,551.63
II. Cash equivalents
Including: Investments in debt securities due within three months
III. Closing balance of cash and cash equivalents	1,969,806,009.56	5,950,036,489.12
Including: Cash and cash equivalents with restricted use of
parent company or subsidiaries within the group

52. Assets with restricted ownership or use rights

Item Closing balance Reason for restriction	Item Closing balance Reason for restriction
Cash and cash equivalents Cash and cash equivalents Total	84,800.00 Guaranteed deposit 470,463.08 Not used for a long time/Not checkedd 555,263.08

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53. Government subsidy

Details of Government subsidy

Species Amount Listed items Amount included in current profit and loss	Species Amount Listed items Amount included in current profit and loss	Species Amount Listed items Amount included in current profit and loss
Financial support Stable subsidy Small financial support income Rent subsidy income Total	20,000,000.00 Other income 6,034,820.96 Other income 1,187,768.87 Other income 273,750.00 Other income 27,496,339.83	20,000,000.00 6,034,820.96 1,187,768.87 273,750.00 27,496,339.83

VII. Changes In the Scope Of Consolidation

1. Business combinations not under common control

None.

2. Business combination under the same control

None.

3. Reverse purchase

None.

4. Disposal of subsidiaries

									The difference between the	The difference between the
							the point	Basis for	disposal price and the share
					Equity
		Equity		Equity			in time	determination of	of the subsidiary's net
					dispos
Subsidiary	name	disposal		disposal			when	the point in time	assets at the consolidated
						al
		price		ratio（%）			control	when control is	financial statement level
					method
							was lost	lost	corresponding to the
										disposal investment
								Sign the transfer
Beijing Offcn Future
								agreement and
Education Technology		51,000,000.00		51.00	Transfer		2021-10-12			26,620.33
								receive the disposal
Co., Ltd.
								payment
Continued：
Percentage	Book value of			Fair value of		Gain or loss from		Determination method		Amount transferred
of remaining	remaining equity		remaining equity			remeasurement of		and main assumptions		from other
equity at the	on the date of loss		at	the date of loss		remaining equity at		of fair value of		comprehensive

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date of loss of control of control	fair value	remaining	equity on income related to
of control（%）		the date of loss of equity investment in
		control atomic company to
			investment profit and
			loss
49.00 48,974,423.60 49,000,000.00	25,576.40	Appraised value
5. Changes in the scope of consolidation due to other reasons
The name of the subsidiary	Proportion of shareholding (%)		Reason for changes
1.Lu’an Yazhong Real Estate Information Consulting Co., Ltd.		100.00	Acquisition(Note)
2.Lu’an Zhongke Real Estate Information Consulting Co., Ltd.		100.00	Acquisition(Note)
3.Wenling Offcn Information Consulting Co., Ltd		100.00	New establishment
4.Anshan Tiedong Offcn Education Training School Co.,		100.00	New establishment
Ltd.
5.Diqing Offcn Training School Co., Ltd.		100.00	New establishment
6.Dali Offcn Education Training School Co., Ltd.		100.00	New establishment
7.Harbin Nangang Offcn Education Training School Co.,		100.00	New establishment
Ltd.
8.Nujiang Offcn Training School Co., Ltd.		100.00	New establishment
9.Weixi Offcn Education Training School Co., Ltd.		100.00	New establishment
10.Beijing Offcn Century Education Technology Co., Ltd		100.00	New establishment

Note: The Company's acquisition of Lu'an Yazhong Real Estate Information Consulting Co., Ltd. and Lu'an Zhongke Real Estate Information Consulting Co., Ltd. does not constitute a business combination, and its essence is essentially the purchase of assets.

6. Other

None.

Section VIII. Interests In Other Entities

1. Interests in subsidiaries

1.1 Composition of the company

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	Principal			Proportion of	Proportion of	Voting
Name	Business	Place of	Nature of	shareholding（%）		rights	Acquisition
		registration	business				Method Direct
	Address			Direct	Indirect	ratio（%）
1.Offcn Ltd.	Beijing	Beijing	Service	100.00		100.00	Reverse purchase
2.Wuhu Yawei Automobile Sales Service Co.,
	Wuhu	Wuhu	Sales	100.00		100.00	New establishment
Ltd
3.Ningguo Yaxia Motor Vehicle Driver Training
	Ningguo	Ningguo	Service	100.00		100.00	New establishment
School (Co., Ltd.)
4.Huangshan Yaxia Fudi Automobile Sales
	Huangshan	Huangshan	Sales	100.00		100.00	New establishment
Services Co., Ltd.
5.Chaohu Yaxia Kaixuan Automobile Sales
	Hefei	Hefei	Sales	100.00		100.00	New establishment
Service Co., Ltd.
6.Bozhou Yaxia Motor Vehicle Driver Training
	Bozhou	Bozhou	Service	100.00		100.00	New establishment
School Co., Ltd.
7.Suzhou Bokai Automobile Sales Service Co.,
	Suzhou	Suzhou	Sales	100.00		100.00	Acquisition
Ltd.
8.Shaanxi Offcn Education Technology Co.
	Xi'an	Xi'an	Service	100.00		100.00	New establishment
Ltd.
9.Chengdu Offcn Future Education Training
	Chengdu	Chengdu	Service	100.00		100.00	New establishment
School Co. Ltd.
10.Lu’an Yazhong Real Estate Information
	Lu'an	Lu'an	Real estate	100.00		100.00	Acquisition
Consulting Co., Ltd.
11.Lu’an Zhongke Real Estate Information
	Lu'an	Lu'an	Real estate	100.00		100.00	Acquisition
Consulting Co., Ltd.
12.Zhejiang Offcn Education Technology Co.
	Hangzhou	Hangzhou	Service		100.00	100.00	New establishment
Ltd..
13.Taizhou Offcn Future Enterprise
	Taizhou	Taizhou	Service		100.00	100.00	New establishment
Management Consulting Co., Ltd.
14.Wenling Offcn Information Consulting Co.,
	Wenling	Wenling	Service		100.00	100.00	New establishment
Ltd.
15.Beijing Offcn Xinzhiyu Online Technology
	Beijing	Beijing	Service		100.00	100.00	New establishment
Co., Ltd.
16.Hulun BuirHailar Offcn Education
	Hulunbeier	Hulunbeier	Service		100.00	100.00	New establishment
Information Consulting Co., Ltd..

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			Principal			Proportion of	Proportion of	Voting
	Name		Business	Place of	Nature of	shareholding（%）		rights	Acquisition
				registration	business				Method Direct
			Address			Direct	Indirect	ratio（%）
17.Xilinhot Offcn Future Education Consulting
			Xilinhaote	Xilinhaote	Service		100.00	100.00	New establishment
Co., Ltd
18.Yueqing Lecheng Offcn		Training Center Co.,
			Yueqing	Yueqing	Service		100.00	100.00	New establishment
Ltd..
19.Jiaozuo Offcn Future Education Service Co.,
			Jiaozuo	Jiaozuo	Service		100.00	100.00	New establishment
Ltd
20.Xinzheng Offcn Cultural Communication
			Zhengzhou	Zhengzhou	Service		100.00	100.00	New establishment
Co., Ltd..
21.Chongqing Jiangbei Offcn Vocational
			Chongqing	Chongqing	Service		100.00	100.00	New establishment
Examination Training Co.,		Ltd.
22.Nanning Offcn Future Education Consulting
			Nanning	Nanning	Service		100.00	100.00	New establishment
Co., Ltd.
23.Baiyin Offcn Future Education Consulting
			Baiyin	Baiyin	Service		100.00	100.00	New establishment
Co., Ltd.
24.Beijing Xinde Zhiyuan Enterprise
			Beijing	Beijing	Service		100.00	100.00	New establishment
Management Consulting Co., Ltd..
25.Nanjing Huiyue Hotel Management Co.,
			Nanjing	Nanjing	Service		100.00	100.00	Acquisition
Ltd.
26.Shandong Kunzhong Real Estate Co., Ltd.			Jinan	Jinan	Service		100.00	100.00	Acquisition
27.Sanmenxia Offcn Cultural Communication
			Sanmenxia	Sanmenxia	Service		100.00	100.00	New establishment
Co., Ltd.
28.Liaoning Offcn Academic & Cultural
			Shenyang	Shenyang	Service		100.00	100.00	New establishment
Exchange Co., Ltd.
29.Liaoning Offcn	Education Technology Co.,
			Shenfuxinqu	Shenfuxinqu	Service		100.00	100.00	New establishment
Ltd.
30.Shandong Offcn	Education Technology Co.,
			Qingdao	Qingdao	Service		100.00	100.00	New establishment
Ltd.
31.Jilin Changyi	Offcn	Education Training
			Jilin	Jilin	Service		100.00	100.00	New establishment
School Co., Ltd.
32.Yuxi Offcn Training School Co., Ltd.			Yuxi	Yuxi	Service		100.00	100.00	New establishment
33.Tonghua Offcn Training		School Co., Ltd.	Tonghua	Tonghua	Service		100.00	100.00	New establishment

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								Principal			Proportion of	Proportion of	Voting
				Name				Business	Place of	Nature of	shareholding（%）		rights	Acquisition
									registration	business				Method Direct
								Address			Direct	Indirect	ratio（%）
34.Hunan		Lightsalt			Offcn		Education
								Changsha	Changsha	Service		90.00	90.00	New establishment
Technology Co.,			Ltd..
35.Tianjin	Hexi		Offcn Training School Co.,
								Tianjin	Tianjin	Service		100.00	100.00	New establishment
Ltd.
36.Chengdu		Offcn Education Training School
								Chengdu	Chengdu	Service		100.00	100.00	New establishment
Co., Ltd.
37.Shandong		Zhuoda Business Management
								Rizhao	Rizhao	Service		100.00	100.00	New establishment
Co., Ltd.
38.Liaoning		Zhongcheng				Real	Estate
								Shenfuxinqu	Shenfuxinqu	Real estate		100.00	100.00	Acquisition
Development Co.,Ltd.
39.Wuhu Offcn Training School Co. Ltd.								Wuhu	Wuhu	Service		100.00	100.00	New establishment
40.Wuhan	Guoshang Human					Resource Service
								Wuhan	Wuhan	Service		100.00	100.00	New establishment
Co., Ltd.
41.Jinan	Zhangqiu			Offcn		Training School
								Jinan	Jinan	Service		100.00	100.00	New establishment
Co.,Ltd.
42.Mengzi Offcn Education Training							Co. Ltd..	Mengzi	Mengzi	Service		100.00	100.00	New establishment
43.Beijing	Offcn Technology					Development Co.
								Beijing	Beijing	Service		100.00	100.00	New establishment
Ltd..
44.Shanghai		Offcn Education Technology Co.
								Shanghai	Shanghai	Service		100.00	100.00	New establishment
Ltd.
45.Guangzhou			Offcn		Smart		Education
								Guangzhou	Guangzhou	Service		100.00	100.00	New establishment
Technology Co. Ltd.
46.Pingshan		Offcn Education Technology Co.
								Shijiazhuang	Shijiazhuang	Service		100.00	100.00	New establishment
Ltd.
47.Shandong		Offcn Education Training School
								Jinan	Jinan	Service		100.00	100.00	New establishment
Co. Ltd.
48.Lanzhou Offcn Education						Training School
								Lanzhou	Lanzhou	Service		100.00	100.00	New establishment
Co. Ltd.
49.Anshan Tiedong				Offcn	Education Training
								Anshan	Anshan	Service		100.00	100.00	New establishment
School Co., Ltd.
50.Diqing	Offcn		Training School Co., Ltd.					DiQingZhou	DiQingZhou	Service		100.00	100.00	New establishment

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				Principal			Proportion of	Proportion of	Voting
		Name		Business	Place of	Nature of	shareholding（%）		rights	Acquisition
					registration	business				Method Direct
				Address			Direct	Indirect	ratio（%）
51.Dali Offcn Education Training			School Co.,
				Dali	Dali	Service		100.00	100.00	New establishment
Ltd.
52.Harbin Nangang		Offcn Education Training
				Harbin	Harbin	Service		100.00	100.00	New establishment
School Co., Ltd.
53.Nujiang Offcn Training School Co., Ltd.				NujiangZhou	NujiangZhou	Service		100.00	100.00	New establishment
54.Weixi Offcn Education Training School Co.,
				Weixi	Weixi	Service		100.00	100.00	New establishment
Ltd.
55.Beijing	Offcn	Century	Education
				Beijing	Beijing	Service		100.00	100.00	New establishment
Technology Co., Ltd

1.2 Material non-wholly owned subsidiaries

None.

1.3 Main financial information in respect of material non-wholly owned subsidiaries

None.

1.4 Significant restrictions on the use of enterprise group assets and pay off debts of the enterprise group

None.

1.5 Financial support or other support provided to structured entities included in the scope of consolidated financial
statements

None.

2. The share of ownership in the subsidiary changes and the subsidiary still controls the transaction

None.

3. Investment subject

None.

4. Interests in joint arrangements or joint ventures

Financial summary for non-important Joint venture and associated enterprise

	Ending balance /	Opening balance /
Item
	Current period	Last Period

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	Ending balance /	Opening balance /
Item
	Current period	Last Period
Associated enterprise：
Total book value of investment	46,850,364.40
Amount based on share-holding ratio	-2,149,635.60
--Net profit	-2,149,635.60
--Other comprehensive income
--Total comprehensive income

5. Significant joint operations

None.

6. Interests in structured entities not included in the scope of consolidated financial statements

None.

7. Other

None.

Section IX. Risks Associated With Financial Instruments

The company's main financial instruments include cash and cash equivalents, financial assets held for trading, accounts receivable, other receivables, debt investments, other equity instrumens, other non-current financial assets, etc. The risks associated with these financial instruments and the risk management policies adopted by the company to reduce these risks are described below. The company's management manages and monitors these exposures to ensure that these risks are contained within a defined range.

’ Risk management objective and policy：The Company s risk management is to strike an appropriate balance between risks and benefits, minimize the negative impact of risks on the Company's business performance and maximize the interests of shareholders and other equity investors. Based on this risk management objective, the basic strategy of the Company's risk management is to determine and analyze various risks faced by the Company, establish an appropriate bottom line for risk tolerance, make risk management and timely and reliably supervise various risks to control the risks within the limited scope.

The main risks caused by the Company's financial instruments are credit risk, liquidity risk and market risk.

1. Classification of financial instruments

1.1Carrying value of various financial assets
（1）31 December 2021

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Item Financial assets measured at amortized cost Financial assets measured at fair value through profit or loss Financial assets measure at fair value through other comprehensive income	Total	Total
Cash and cash equivalents 1,970,361,272.64 Financial assets held for trading 346,726,621.74 Accounts Receivable 40,374,842.27 Other receivables 219,501,061.83 Debt investment 7,058,993.55 Other current assets 12,833,701.81 Other equity instruments 130,400,000.00 Other non-current financial assets 30,260,000.00 （2）31 December 2020 Item Financial assets measured at amortized cost Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income	1,970,361,272.64 346,726,621.74 40,374,842.27 219,501,061.83 7,058,993.55 12,833,701.81 130,400,000.00 30,260,000.00 Total


Cash and cash equivalents 5,950,395,089.12 Financial assets held for trading 983,205,858.25 Accounts Receivable 21,493,637.66 Other receivables 304,318,966.20 Non-current assets due within one year 1,985,873,462.75 Other current assets 41,832,345.30 Other equity instruments 152,800,000.00 Other non-current financial assets 208,450,315.01	5,950,395,089.12 983,205,858.25 21,493,637.66 304,318,966.20 1,985,873,462.75 41,832,345.30 152,800,000.00 208,450,315.01

1.2 Carrying value of various financial liabilities at the balance sheet date as follows：

（1）31 December 2021

Item Financial liabilities at fair value through profit or loss Other liabilities	Total
Short-term borrowings 3,152,945,812.59	3,152,945,812.59

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Financial liabilities at

Financial liabilities at
Item fair value through profit or loss Other liabilities		Total
Accounts payable 282,032,916.52 Other payable 129,043,599.22 Non-current liabilities due within one year 531,876,007.31 Lease liability 635,691,184.87 （2）31 December 2020 Item Financial liabilities at fair value through profit or loss Other liabilities		282,032,916.52 129,043,599.22 531,876,007.31 635,691,184.87 Total
Short-term borrowings 3,976,019,329.22 Accounts payable 211,824,402.86 Other payable 9,479,383.03	3,976,019,329.22 211,824,402.86 9,479,383.03

（2）31 December 2020

2. Credit risk

The financial assets of the company include cash and cash equivalents, financial assets held for trading, accounts receivable, other receivables, etc.The credit risk of these financial assets is caused by the default of the counterparty. The maximum risk exposure is equal to the book amount of these instruments, including:

The Company's working capital is deposited in banks with high credit rating, so the credit risk of working capital is low.

The book value of accounts receivable and other receivables in the consolidated balance sheet is the biggest credit risk that the company may face. The company continuously monitors the balance of accounts receivable and other receivables to ensure that the overall credit risk of the company is under control. The quantitative data of the Company's credit risk exposure arising from accounts receivable and other receivables can be found in Note VI (3) “ Accounts “ “ ” receivable and Note VI (5) Other receivables .

3. Liquidity risk

The company adopts the revolving liquidity plan tool to manage the risk of capital shortage. The facility considers both the maturity date of its financial instruments and the expected cash flow generated by the company's operations.

The goal of the company is to maintain the balance between the sustainability and flexibility of financing by using a variety of financing instruments, including bank loans and other interest-bearing loans.

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When managing liquidity risks, the Company shall maintain sufficient cash and cash equivalents as deemed by the management and monitor them to meet the Company's operational needs and reduce the impact of cash flow fluctuations.The managements monitor the use of bank loans and ensure compliance with loan agreements.

Maturity analysis of financial liabilities based on undiscounted contract cash flow:

31 December 2021

31 December 2021
Item Within 1 year 1-5 years Over 5 years	Total
Short-term loan 3,152,945,812.59 Accounts payable 282,032,916.52 Other payable 129,043,599.22 Non-current liabilities due within one year 550,685,331.89 Lease liability 650,123,884.68 22,037,457.51	3,152,945,812.59 282,032,916.52 129,043,599.22 550,685,331.89 672,161,342.19

Continued：

31 December 2020

31 December 2020
Item Within 1 year 1-5 years Over 5 years	Total
Short-term loan 3,976,019,329.22 Accounts payable 211,824,402.86 Other payable 9,479,383.03	3,976,019,329.22 211,824,402.86 9,479,383.03

Market risk

Market risk refers to the risk that the fair value of financial instruments or future cash flow fluctuates due to changes in market prices.Market risk mainly includes interest rate risk and foreign currency risk.

4.1. Interest rate risk

None.

4.2. Currency risk

None.

Section X. Capital Management

The main objective of the company's capital management is to ensure the company's ability to continue operations and

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maintain healthy capital ratios to support the business and maximize shareholder value.

The company manages the capital structure and adjusts it according to the economic situation and changes in the risk characteristics of related assets.

To maintain or adjust the capital structure, the company may adjust the distribution of profits to shareholders, return capital to shareholders or issue new shares. The company is not subject to external mandatory capital requirements. Capital management objectives, policies or procedures for 2021 remain unchanged.

Section XI. Fair Value Disclosure

1. The ending fair value of assets and liabilities measured at fair value

Item
Fair value at the end of the period
Level 1
Level 2
Level 3

Total

I. Continuous fair value measurement
（I.）Transaction financial asset
346,726,621.74
30,260,000.00
1. Financial asset at fair value through profit or loss
346,726,621.74
30,260,000.00
（1）Debt instruments
346,726,621.74
30,260,000.00
（2）Equity instruments
（3）Derivative financial assets
2. Designated as financial asset at fair value through
profit or loss
（1）Debt instruments
（2）Equity instruments
（II）Other debt investments
（III）Other equity instruments
130,400,000.00
（IV）Investment properties
（V）Biological assets
Total assets measured continuously at fair value
346,726,621.74
160,660,000.00
（IV）Transaction financial liabilities
1. Financial liabilities at fair value through profit or loss
Including：Issued held-for-trading bonds
Derivative financial liabilities
Other
2. Designated as financial asset at fair value through
profit or loss
Total liabilities measured continuously at fair

376,986,621.74
376,986,621.74
376,986,621.74
130,400,000.00
507,386,621.74

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Fair value at the end of the period

Item

Level 1 Level 2 Level 3 Total

value

II 、 Non-continuous fair value measurement

（I）Assets held for sales

Total assets measured non-continuously at fair value

Total liabilities measured non-continuously at fair value

2. The basis for determining the market price of continuous and non-continuous first-level fair value measurement projects

None.

3. Qualitative and quantitative information on the valuation techniques used and important parameters for

continuous and non-continuous second-level fair value measurement projects

The company's sustainable second-level fair value measurement items are mainly financial products, The fair value is determined by the discounted cash flow method and the expected rate of return.

4. Qualitative and quantitative information on the valuation techniques used and important parameters for

continuous and non-continuous third-level fair value measurement projects

The company's sustainable third-level fair value measurement items are mainly non-tradable equity instrument investment and debt instrument investment.The fair value is determined by market method and liquidity discount.

5. Continuous third-level fair value measurement project, adjustment information between the opening and closing book value and sensitivity analysis of unobservable parameters

None.

6. Continuous fair value measurement items, if conversions between various levels occurred during the current period, the reasons for the conversions and the policies for determining the timing of the conversions

None.

7. Changes in valuation techniques that occurred during the period and the reasons for the changes

None.

8. The fair value of financial assets and financial liabilities not measured at fair value

None.

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9. Other

None.

Setion XII. Related Party Relationships And Transactions

1. Basis of identifying related party

Parties are considered to be related if one party has the ability to control or joint control the other party or exercise significant influence over the other party. Parties(two or more than two) are also considered to be related if they are subject to common control,joint control or significant influence from other party.

2. The controlling shareholder of the company

The company is ultimately controlled by Li yongxin and Lu zhongfang. As of 31 December 2021, their combined shareholding accounted for 61.01% of the company's share capital.

3. Subsidiaries of the company

“ ” The details of the subsidiaries of the company are detailed in Note VIII.(1) Interest in subsidiaries .

4. Joint vetures and associates of the company

	Name	Principal Business	Place of	Nature of	Proportion of shareholding（%）	Proportion of shareholding（%）	Accounting
		Address	registration	business	Direct	Indirect	treatment
Associates
Beijing Zhongwang Future
Education	Technology	Beijing	Beijing	Service	49.00		Equity method
Co., Ltd

5. Other related parties of the company

Name	Relationship
Li Yongxin	The controlling shareholder
Beijing Qianqiu Intelligence Book & Media Co.,	Actual controller
Ltd.
Beijing Haidian Offcn Training School	Actual controller
Jinan Offcn Training School	Actual controller
Kunming Wuhua Offcn Training School	Actual controller
Baoding Lianchi Offcn Training School	Actual controller

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Name

Relationship

Beijing Haidian Baoquan Financial Training	Actual controller
Centre
Cangzhou Yunhe Offcn Training School	Actual controller
Chengdu Wuhou Offcn Training School	Actual controller
Cifeng Hongshan Offcn Training Centre	Actual controller
Dezhou Offcn Training School	Actual controller
Haikou Meilan Offcn Training School	Actual controller
Handan Congtai Offcn Training School	Actual controller
Hegang Offcn Training School	Actual controller
Heihe Aihui Offcn Training School	Actual controller
Kiamusze Offcn Training School	Actual controller
Leshan Shizhong Offcn Training School	Actual controller
Mudanjiang Offcn Training School	Actual controller
Qiqihar Tiefeng Offcn Training School	Actual controller
Shaoyang Shuangqing Offcn Training School	Actual controller
Tangshan Lunan Offcn Training School	Actual controller
Weifang Offcn Training School	Actual controller
Urumqi Shayibake Offcn Training School	Actual controller
Yiyang Heshan Offcn Training School	Actual controller
Shenyang Lijing Pearl Hotel Management Co.,
	Enterprises controlled by the directors of the company
Ltd.
Beijing Taifu Hotel Management Co., Ltd.	Enterprises controlled by the directors of the company
Beijing Xingshou Fuyuan Plantation	The company controlled by the company's controlling shareholder and actual controller Li Yongxin's spouse Xu Hua
Beijing Chuangsheng Construction Decoration Engineering Co., Ltd.	Enterprises controlled by the directors of the company
Shanghai Beiding Network Technology Co., Ltd.	Enterprises controlled by the directors of the company
Ji'an Jingkai Lixiangxue Financial Information Service Co., Ltd.	Enterprises controlled by the directors of the company
Shaanxi Guancheng Industrial Co., Ltd.	Enterprises controlled by the directors of the company
Liaoning Hanhui Industrial Co., Ltd.	Enterprises controlled by the directors of the company
Wang Zhendong	The company's directors / senior managers / shareholders who directly hold more than 5% (including 5%) of the company's shares
Shi Lei	Director of the company

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	Name	Relationship
Yi Ziting		Director of the company
Chen Yuqin		Independent director of the company
Jiang Tao		Independent director of the company
Zhang Xuanming		Independent director of the company
Wang Qiang		Independent director of the company,Term from February 1,2019 to January 28,2022
Tong Yan		Independent director of the company,Term from February 1,2019 to January 28,2022
Yu Hongwei		Supervisor of the company
Li Wen		Supervisor of the company
He Di		Supervisor of the company
He Youli		Senior management of the company
Gui Hongzhi		Senior management of the company
Luo Xue		Senior management of the company
Wang Xuejun		Senior management of the company,Term from February 1,2019 to January 28,2022

Note: This report only lists related parties that have business dealings with the company during the reporting period.

6. Related-party transaction

6.1 Related transactions for the purchase and sale of goods, provision and receipt of services

6.1.1 the table of procurement of goods/acceptance of labor services

Related parties	Content of related party transaction	Amount for the current period	Amount for the previous period
Beijing Taifu Hotel Management Co.,	Accommodation and catering	11,802,340.00	20,569,200.00
Ltd.	services
Beijing Haidian Offcn Training School	Joint school running	450,000.00	1,032,000.00
Zhanjiang Xiashan Offcn Training Center	Joint school running	320,000.00
Chengdu Wuhou Offcn Training School	Joint school running	280,000.00	236,000.00
Urumqi Shayibake Offcn Training School	Joint school running	208,600.00	504,000.00
Shaoyang Shuangqing Offcn Training School	Joint school running	170,000.00	124,600.00
Leshan Shizhong Offcn Training School	Joint school running	150,000.00	165,000.00
Tangshan Lunan Offcn Training School	Joint school running	140,000.00	115,000.00
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Related parties	Content of related party transaction	Amount for the current period	Amount for the previous period
Handan Congtai Offcn Training School	Joint school running	140,000.00	100,000.00
Baoding Lianchi Offcn Training School	Joint school running	130,000.00	90,000.00
Beijing Haidian Baoquan Financial Training Centre	Joint school running	120,000.00	60,000.00
Cangzhou Yunhe Offcn Training School	Joint school running	120,000.00	105,000.00
Yiyang Heshan Offcn Training School	Joint school running	80,000.00	96,000.00
Heihe Aihui Offcn Training School	Joint school running	66,500.00	84,998.00
Mudanjiang Offcn Training School	Joint school running	60,500.00	62,800.00
Kiamusze Offcn Training School	Joint school running	60,500.00	60,500.00
Cifeng Hongshan Offcn Training Centre	Joint school running	50,000.00	47,000.00
Haikou Meilan Offcn Training School	Joint school running	20,000.00
Qiqihar Tiefeng Offcn Training School	Joint school running		121,800.00
Weifang Offcn Training School	Joint school running		71,100.00
Dezhou Offcn Training School	Joint school running		11,718.00
Ji'an Jingkai Lixiangxue Financial Information Service Co., Ltd.	Fee	181,824,220.00	141,735,023.00
Shanghai Beiding Network Technology Co., Ltd.	Fee	1,320,000.00	68,993,588.00

6.1.2The table of sale of goods/provision of labor services

Related parties Beijing Qianqiu Intelligence Book & Media Co., Ltd.

Content of related	Amount for the current	Amount for the
party transaction	period	previous period
Exhibition Service	3,364,150.85	2,871,698.11

6.2 Related fiduciary management / contracting and entrusted management / outsourcing

6.2.1 The company's entrusted management / contracting situation table:

Trustee /Outsourcer Name	Trustee / Contractor Name	Type	Entrustment / contracting start date	Entrustment / Contract Termination Date	Custody income / contracting income pricing basis	Annually recognized custody income / contracting income
		33 Civil	19 October		All reasonable returns
Li Yongxin	Offcn Ltd.	non-schools	2018	Long term	on the entrusted assets	226,415.10

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Trustee /Outsourcer Name Trustee / Contractor Name Type Entrustment / contracting start date Entrustment / Contract Termination Date Custody income / contracting income pricing basis Annually recognized custody income / contracting income	Trustee /Outsourcer Name Trustee / Contractor Name Type Entrustment / contracting start date Entrustment / Contract Termination Date Custody income / contracting income pricing basis Annually recognized custody income / contracting income
Total	226,415.10

6.2.2 The company's entrusted management / contracting situation table：

None.

6.3 Related lease

6.3.1 The company as the lessor：

None.

6.3.2 The company as the lessee：

Name of lessor Category Lease start date Lease terminati on date Rental fee pricing basis Rental fee recognised in the current period Rental fee recognized in the previous period Shenyang Lijing Pearl Hotel Management Co., Ltd. Operating lease 1 July 2016 30 June 2026 Agreed price 25,030,700.00 18,175,675.00 Total 25,030,700.00 18,175,675.00	Name of lessor Category Lease start date Lease terminati on date Rental fee pricing basis Rental fee recognised in the current period Rental fee recognized in the previous period Shenyang Lijing Pearl Hotel Management Co., Ltd. Operating lease 1 July 2016 30 June 2026 Agreed price 25,030,700.00 18,175,675.00 Total 25,030,700.00 18,175,675.00	Name of lessor Category Lease start date Lease terminati on date Rental fee pricing basis Rental fee recognised in the current period Rental fee recognized in the previous period Shenyang Lijing Pearl Hotel Management Co., Ltd. Operating lease 1 July 2016 30 June 2026 Agreed price 25,030,700.00 18,175,675.00 Total 25,030,700.00 18,175,675.00
	25,030,700.00 25,030,700.00	18,175,675.00 18,175,675.00

6.4 Related party guarantee

6.4.1 The company act as the guarantor

None.

6.4.2 The company is the guaranteed party

None.

6.5 Borrowing of funds from related parties

None.

6.6 Related party assets transfer and debt restructuring

	Content of related	Asset pricing	Amount for the	Amount for the
Related parties	party transaction	basis	current period	previous period

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Related parties Content of related party transaction Asset pricing basis Amount for the current period Amount for the previous period	Related parties Content of related party transaction Asset pricing basis Amount for the current period Amount for the previous period	Related parties Content of related party transaction Asset pricing basis Amount for the current period Amount for the previous period
Shaanxi Guancheng Industrial Co., Ltd. purchase assets Agreement price Beijing Chuangsheng Construction Decoration Engineering Co., Ltd. purchase assets Agreement price Total 7 Key executive compensation Item Amount for the current period	383,060,000.00 513,815.00 513,815.00 383,060,000.00 Amount for the prior period	383,060,000.00 383,060,000.00
Key executive compensation 6,120,389.56	14,922,629.18

6.7 Key executive compensation

6.8 Other related transactions

6.8.1 Commissioned decoration/engineering

Related parties Pricing basis	Amount for the current period	Amount for the current period	Amount for the current period	Amount for the prior period	Amount for the prior period
	Contract amount	Amount		Contract amount	Amount
Beijing Chuangsheng Construction Decoration Engineering Co., Ltd. Agreement price Total 8.2 Liquidated damages income Related parties	35,458,590.00 242,000,000.00 369,467,820.00 35,458,590.00 242,000,000.00 369,467,820.00 Amount for the current period Amount for the prior period			242,000,000.00 242,000,000.00	369,467,820.00 369,467,820.00
Liaoning Hanhui Industrial Co., Ltd. Total			18,141,095.89 18,141,095.89

6.8.2 Liquidated damages income

7. Related party accounts receivable and payable

7.1 Accounts receivables

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Item Related party	Closing balance Carrying amount Bad debt provision	Closing balance Carrying amount Bad debt provision	opening balance Carrying amount Bad debt provision
Other receivable Shenyang Lijing Pearl Hotel Management Co., Ltd. 5,675,200.00 5,675,200.00 Other receivable Liaoning Hanhui Industrial Co., Ltd. 200,000,000.00 Other non-current assets Beijing Offcn Future Education Technology Co., Ltd. 1,618,391,145.38 Total 1,624,066,345.38 205,675,200.00 7.2 Accounts payable Item Related party Closing balance opening balance
Account payable Beijing Chuangsheng Construction Decoration Engineering Co., Ltd. Account payable Shaanxi Guancheng Industrial Co., Ltd. Other account payable Ji'an Jingkai Lixiangxue Financial Information Service Co., Ltd. Total		59,506,981.00 48,358,391.00 83,060,000.00 83,060,000.00 57,000,000.00 199,566,981.00 131,418,391.00

8. Related party commitments

None.

9. Other

None.

Setion XIII. Share-based Payment

1. Overview of share-based payment

None.

2. Equity-settled share payments

None.

3. The Stock payment settled by cash

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None.

4. Modification and termination of the stock payment

None.

5. Other

None.

Setion XIV. Commitment And Contingency

1. Important commitment

None.

2. Contingency

None.

3. Other

None.

Setion XV. Events After Balance Sheet Date

1. Significant unadjusted events

None.

2. Profit distribution

None.

3. Sales return

None.

4. Other adjustment events after balance sheet date

None.

Setion XVI. Other Significant Events

1. Debt Restructuring

None.

2. Assets exchange

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None.

3. Annuity plan

None.

4. Discontinued operations;

None.

5.Segment information

5.1 Report segment determining and accounting policy

The company's main production and operation activities are decided by the company, which is mainly engaged in education and training business. Therefore, the company is managed as an operating segment. For accounting policies, ’ ” ” please refer to Note III to this report, "The Company s Significant Accounting Policies And Accounting Estimates . .

5.2 Other information

5.2.1 Revenue from external transactions for each product and service or each similar product and service.

Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period	Item Amount for the current period Amount for the prior period
Main business Including：Education and training Other business Total	6,860,282,371.30 6,860,282,371.30 51,440,960.49 6,911,723,331.79	11,138,901,718.71 11,138,901,718.71 63,592,576.33 11,202,494,295.04

5.2.2 The total amount of foreign transaction income obtained by the enterprise from its own country and from other
countries or regions.

Area name Amount for the current period Amount for the prior period	Area name Amount for the current period Amount for the prior period	Area name Amount for the current period Amount for the prior period
Domestic area Total	6,911,723,331.79 6,911,723,331.79	11,202,494,295.04 11,202,494,295.04

5.2.3 The extent of dependent on its major customers.

The company's customers are relatively scattered, consisting of a large number of customers, and there is no dependence on major customers.

6. Borrowing costs

The company has no capitalized borrowing costs during the reporting period.

7. Foreign currency translation

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None.

8. Lease

8.1 Lessor

8.1.1 Financial leasing.

None.

8.1.2 Operating lease

Assets leased out under operating leases:

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Buildings Land use rights Total Item	310,663,290.95 319,663,553.88 334,273,250.51 348,350,961.94 644,936,541.46 668,014,515.82 Amount
I.Income situation Lease income Income related to variable lease payments not included in lease income II.Lease income not turned into cash for five consecutive fiscal years after the balance sheet date Year 1 Year 2 Year 3 Year 4 Year 5 III.Lease income received for remaining years that is not turned into cash Within 1 year (inclusive) 1-2 years (inclusive) 2-3 years (inclusive) Over 3 years		19,285,714.29 19,285,714.29 40,125,000.00 40,125,000.00 40,125,000.00 40,125,000.00

8.2 Lessee

8.2.1 The lessee shall disclose the following information related to the lease

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Item	Amount
Interest expense on lease liability	81,571,707.31
Short-term lease expenses included in current profit and loss
Low-value asset leasing expense included in current profit and loss
Variable lease payments not included in the measurement of the lease liability
Income derived from sublease of right-of-use assets
Total cash outflow related to lease	606,571,985.34
Gains and losses arising from sale and leaseback transactions

8.2.2 Lessees should disclose other qualitative and quantitative information about leasing activities as required by

financial statements

None.

9. Other significant transactions and matters that may affect investors' decision making

None.

10. Other

None.

Setion XVII. Notes Of Main Items In the Financial Statements of the Company as the Parent

1. Accounts receivable

1.1 Disclosure by aging

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Within 1 year (inclusive) 1-2 years (inclusive) Less:Provision for bad debts Total	15,570,863.42 15,570,863.56 2,335,629.53 28,806,097.45	15,570,863.56 778,543.18 14,792,320.38

1.2 Disclosure by bad debt accrual method

		Closing balance
Item
	Book balance	Bad debt	Book value

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	Amount Percentage （%）	Amount Percentage （%）	Amount Percentage of provision (%)
Accounts receivable with a collective bad debt provision Combination3 Total	31,141,726.98 31,141,726.98 31,141,726.98	100.00 100.00 100.00	2,335,629.53 7.50 2,335,629.53 7.50 2,335,629.53 --	28,806,097.45 28,806,097.45 28,806,097.45

Continued：

Item	Opening balance Book balance Bad debt Amount Percentage （%） Amount Percentage of provision (%)	Opening balance Book balance Bad debt Amount Percentage （%） Amount Percentage of provision (%)	Opening balance Book balance Bad debt Amount Percentage （%） Amount Percentage of provision (%)	Book value
Accounts receivable with a collective bad debt provision Combination3 Total	15,570,863.56 15,570,863.56 15,570,863.56	100.00 100.00 100.00	778,543.18 5.00 778,543.18 5.00 778,543.18 --	14,792,320.38 14,792,320.38 14,792,320.38

Collective bad debt provision:

Item	Closing balance Accounts receivables Bad debt provision Percentage of provision	Closing balance Accounts receivables Bad debt provision Percentage of provision
Combination3 Total	31,141,726.98 31,141,726.98	2,335,629.53 7.50 2,335,629.53 --

1.3 Bad debt provision in the current period:

Item	Opening balance	Amount of change in the current period Provision Recovery or reversal Write-off Others	Closing balance
Bad debt provision for accounts receivable Total	778,543.18 778,543.18	1,557,086.35 1,557,086.35	2,335,629.53 2,335,629.53

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1.4 Top five debtors with the biggest ending balances of accounts receivable

Name Nature	Closing balance	Provision Age Percentage of total accounts receivable (%)	Provision Age Percentage of total accounts receivable (%)
Yaxia Industrial Lease Total	31,141,726.98 31,141,726.98	2,335,629.53 within 2 years 2,335,629.53	100.00 100.00

2. Other receivables

2.1 Classified listing

Item Closing balance Opening balance	Item Closing balance Opening balance	Item Closing balance Opening balance
Other receivables Total	20,699,731.33 20,699,731.33	621,900,443.29 621,900,443.29

2.2 Other receivables

2.2.1 Disclosure by aging

Aging Closing	balance Opening balance	balance Opening balance
Within 1 year (inclusive) 1-2 years (inclusive) 2-3 years (inclusive) Less: Provision for bad debts Total	1,758,288.04 991,922.30 17,949,520.99 20,699,731.33	603,950,922.30 17,949,520.99 621,900,443.29

2.3.2 Other receivables by nature of the payment

Item Closing balance Opening	Item Closing balance Opening	balance
Current account Deposits and guarantees Total	20,694,131.33 5,600.00 20,699,731.33	621,894,843.29 5,600.00 621,900,443.29

2.3.3 Withdrawing process of bad debt provision

None.

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2.3.4 Top 5 other receivable at the end of the period

Creditor Nature of payment	Closing balance Aging Percentage of total other receivables (%) Bad debt provision	Closing balance Aging Percentage of total other receivables (%) Bad debt provision
Bozhou Yaxia Motor Vehicle Driver Training School Co., Ltd Current account Wuhu Yawei Automobile Sales and Service Co., Ltd Current account Suzhou Bokai Automobile Sales and Service Co., Ltd Current account Huangshan Asia Xia Fudi Automobile Sales and Service Co., Ltd Current account Chaohu Yazhou Kaixuan Automobile Sales and Service Co., Ltd Current account Total	10,413,457.84 within 3 years 3,790,228.27 within 3 years 3,772,453.42 within 3 years 2,031,405.31 within 3 years 459,974.46 within 3 years 20,467,519.30	50.31 18.31 18.22 9.81 2.22 98.87

3. Long-term equity investments

Item	Closing balance Book balance Impairment provision	Book value	Opening balance Book balance Impairment provision	Book value
Investment in subsidiaries 19,143,591,207.14 19,143,591,207.14 18,582,307,907.14 18,582,307,907.14 Investment for associates and joint venture 46,824,788.00 46,824,788.00 Total 19,190,415,995.14 19,190,415,995.14 18,582,307,907.14 18,582,307,907.14 3.1 Investment in subsidiaries Investee Opening balance Increase Decrease Closing balance Provision for impairment Impairment reserve closing balance
ZhongGong limited 18,500,000,000.00 18,500,000,000.00 Lu'an Zhongke Real Estate Information Consulting Co., Ltd 489,131,700.00 489,131,700.00

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Investee	Opening balance	Increase Decrease Closing balance Provision for impairment Impairment reserve closing balance
Lu'an Yazhong Real Estate Information Consulting Co., LTD Wuhu Yawei Automobile Sales and Service Co., Ltd Ningguo City Yaxia Motor Vehicle Driver Training School Huangshan Asia Xia Fudi Automobile Sales and Service Co., Ltd Chaohu Yazhou Kaixuan Automobile Sales and Service Co., Ltd Bozhou Yaxia Motor Vehicle Driver Training School Co., Ltd Suzhou Bokai Automobile Sales and Service Co., Ltd Total	23,000,000.00 17,474,782.14 5,000,000.00 5,000,000.00 20,000,000.00 11,833,125.00 18,582,307,907.14	72,151,600.00 72,151,600.00 23,000,000.00 17,474,782.14 5,000,000.00 5,000,000.00 20,000,000.00 11,833,125.00 561,283,300.00 19,143,591,207.14

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3.2 Investment in associates and joint ventures

The invested entity Opening balance	Increase	Changes for the year Decrease Investment profit under equity method Other comprehensive income adjustment Other equity change Cash dividends or profits announced of issuance Provision for impairment	Changes for the year Decrease Investment profit under equity method Other comprehensive income adjustment Other equity change Cash dividends or profits announced of issuance Provision for impairment	Others	Closing balance Closing balance of provision for impairment
II.Associates Beijing Zhongwang Future Education Technology Co., Ltd Total	100,000,000.00 100,000,000.00	51,000,000.00 51,000,000.00	-2,174,511.83 -2,174,511.83	-700.17 -700.17	46,824,788.00 46,824,788.00

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4. Share capital

Item	Opening balance Changes in the current period（+、-） Issue new shares Bonus share Provident fund transfer to share capital other Total	Closing balance
1. Shares with limited sale conditions 5,419,759,990.00 -854,983,969.00 -854,983,969.00 4,564,776,021.00 1.1. Other domestic shares 5,419,759,990.00 -854,983,969.00 -854,983,969.00 4,564,776,021.00 Inc: Domestic legal person shares 534,706,341.00 -534,706,341.00 -534,706,341.00 Domestic natural person holdings 4,885,053,649.00 -320,277,628.00 -320,277,628.00 4,564,776,021.00 2. Shares in circulation without restrictions on sale 747,639,399.00 854,983,969.00 854,983,969.00 1,602,623,368.00 common stock 747,639,399.00 854,983,969.00 854,983,969.00 1,602,623,368.00 Total 6,167,399,389.00 6,167,399,389.00 5. Operating income and operating costs Item Amount for the current period Amount for the prior period Operating income Operating costs Operating income Operating costs Other businesses 14,831,488.06 11,230,514.83 14,829,393.86 11,336,628.27 Total 14,831,488.06 11,230,514.83 14,829,393.86 11,336,628.27 6. Investment income Item Amount for the current period Amount for the prior period Dividend income obtained during the holding period of other equity instrument investments 1,327,872.00 249,600.00 Long-term equity investments income under equity method -2,174,511.83 Investment income from Financial product 10,466.92 Total -836,172.91 249,600.00

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Setion XVIII. Supplementary Information

Pursuant to the Explanatory Announcement for Information Discliosure of Companies Offering Securities to the Public No.1-Non-recurring Profit and Loss issued by China Securities Regulatory Commision,non-recurring profit and loss as follows.

Breakdown of non-recurring profit and loss during the reporting period

Breakdown of non-recurring profit and loss	Amount	Description
（1）Profit and loss on disposal of non current assets	-136,455.49
（2）Tax refunds, reductions or exemptions without approval or without formal approval
documents
（3）Government subsidies included in the current profit and loss (closely related to the
business of the enterprise, except for government subsidies that are fixed or quantified	27,496,339.83
in accordance with national unified standards)
（4）Capital occupation fees charged to non-financial enterprises included in the current
profit and loss
（5）The company can obtain the differences when the investment cost of an
enterprise's acquisition of subsidiaries, associates and joint ventures is less than the
income derived from the fair value of the identifiable net assets of the investee.
（6）Non-monetary asset exchange gains and losses
（7）Profit or loss from entrusting others to invest or manage assets	56,955,660.58
（8）Impairments for assets due to force majeure factors, such as natural disasters
（9）Debt restructuring gains and losses
（10）Enterprise restructuring costs, such as expenses for relocating employees,
integration costs, etc.
（11）Gains and losses in excess of fair value resulting from transactions where the
transaction price was significantly unfair
（12）Net profit or loss for the period from the beginning of the subsidiary to the
business combination date resulting from a business combination under the same
control.
（13）Gains and losses from contingencies unrelated to the company's normal business
operations
（14）In addition to the effective hedging business related to the company's normal
business operations, the holding of financial assets held for trading, derivative financial
assets, financial liabilities held for trading, and changes in fair value arising from derivative financial liabilities, and disposal of financial assets held for trading, derivative	-21,490,322.52
finance investment income from assets, financial liabilities held for trading, derivative
financial liabilities and other debt investments
（15）Receivables and contract asset impairment reserves that are individually tested
for impairment are reversed.

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Breakdown of non-recurring profit and loss		Amount
（16）Gains and losses from external entrusted loans
（17）Gains and losses from changes in the fair value of investment real estate that are
subsequently measured at the fair value model
（18）The impact on the current profit and loss should be adjusted	in one time in
accordance with the requirements of tax and accounting laws
（19）Custody fee income from entrusted operations		226,415.10	,
（20）Non-operating income and expenses other than the above		16,837,313.42
（21）Other profit and loss items that meet the definition of non-recurring profit and loss		60,675,060.38
Total non-recurring profit and loss		140,564,011.30
Less：Amount of income tax impact		24,442,598.26
Non-recurring profit and loss after deducting income tax effects		116,121,413.04
Inc：Non-recurring profit and loss attributable to owners of the parent company		116,121,413.04
Non-recurring profit and loss attributable to minority shareholders

Note: Other profit and loss items that meet the definition of non-recurring gains and losses are mainly :

According to the "Announcement on Supporting Tax Policies for the Prevention and Control of the Pneumonia Epidemic of Novel Coronavirus Infection" (Announcement No. 8, 2020 of the Ministry of Finance and Taxation Administration), the value-added tax exempted from RMB 60,293,558.79, according to the "Announcement on Deepening the Relevant Policies of Value-Added Tax Reform" "(Announcement No. 39, 2019) of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs) The additional input tax deduction is RMB 355,925.19. After the loss of control, the remaining equity is re-measured at fair value with a gain of RMB 25,576.40.

Return on equity and earnings per share

	Weighted	Earnings	per share
Profit for the reporting period	average return	Basic earnings	Diluted earnings
	on net assets (%)	per share	per share
Net profit attributable to ordinary shareholders	-76.88	-0.38	-0.38
of the company
Net profit attributable to ordinary shareholders
of the company after deducting non-recurring	-80.65	-0.40	-0.40
gains and losses

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Offcn Education Technology Co., Ltd. — Annual Report 2021

54632_rns_2022-04-28_87a2cb80-8af3-4a57-b8b8-3391719774d8.PDF

OFFCN EDUCATION TECHNOLOGY CO., LTD. 2021 Annual Report

Chapter 1 Important Information, Table of Contents and Definitions

Contents

Documents Available for Reference

Definitions

Chapter 2 Corporate Profile & Key Financial Indicators

Section I. Corporate profile

Section II. Contact information

Section III. Information disclosure and location of Annual Report

Section IV. Registration Changes

Section V. Other relevant information

Section VI. Key Accounting Information and Financial Indicators

□ Yes √ No

√ Yes □ No

Section VII. Differences in accounting data under domestic and overseas accounting standards

1. Differences between net profits and net assets disclosed in the financial reports in accordance with Chinese accounting standards and international accounting standards

□ Applicable √ Not applicable

2. Differences between net profits and net assets disclosed in the financial reports in accordance with Chinese accounting standards and overseas accounting standards

□ Applicable √ Not applicable

Section VIII. Quarterly Key Financial Indicators

Section IX. Non-Recurring Profits and Losses

□ Applicable √ Not applicable

Chapter 3 Management Discussion and Analysis

Section I. The industry situation of the Company during the reporting period

1. The “14th Five-Year Plan” requires that the quality and capacity of education, medical care, elderly care and other services be greatly improved.

2. With more policy support, the operation of improving vocational skills speeds up.

3. Main industry characteristics and cyclical characteristics

Section II. The Company’s main business during the reporting period

Section III. Analysis of the Company’s core competitiveness

1. Clustered professional R&D continuously outputs momentum for innovation

2. Vertical integrated fast response capability supports the Company ’s sustainable operation structurally and efficiently.

3. Digital operation forms the enterprise platform with “real-time situational awareness”

4. The values of kindness and altruism allow the Company to maintain strong organizational cohesion in high growth

5. Offcn Edu strives to strengthen the Party's construction to promote the healthy and vigorous development of the Company

Section IV. Core business analysis

1. Overview

(1) Impacted by the pandemic, market demand has shrunk, and the performance of the Company in the current period has appeared great fluctuation.

(2) New business sector develops steadily and the return on upfront investment appears.

2. Revenue and cost

(1) Composition of revenue

(2) Particulars of sectors, products, regions and sales models that account for more than 10% of the operating revenue or profits

(3) Is the Company’s goods sales income greater than that of labor services?

(4) Fulfillment of significant sales contracts and purchase contracts signed by the Company as of the reporting period

(5) Composition of operating cost

(6) Did the scope of consolidation change during the reporting period?

√Yes □No

(7) Major changes or adjustments to the Company’s business, products, or services during the reporting period

(8) Major customers and major suppliers

3. Expenses

4. R&D investment

R&D staff

5. Cash flow

Section V. Non-core business analysis

Section VI. Analysis of assets and liabilities

1. Major changes in asset composition

2. Assets and liabilities measured at fair value

3. Assets with restricted rights as of the end of the reporting period

Section VII. Analysis of Investments

1. General situation

2. Significant equity investment obtained during the reporting period

3. Significant non-equity investment ongoing during the reporting period

4. Financial assets investment

（ 1 ） Securities investment

(2) Derivatives investment

5. Use of raised funds

Section VIII. Sale of major assets and equity

1. Sale of major assets

2. Sale of major equity

Section IX. Analysis of major holding and participating companies

√ Applicable □Not Applicable

√ Applicable □ Not Applicable

Section X. Structured entities controlled by the Company

Section XI. Forecast of the Company’s future development

1. Trends of the industry’s future development

(1) The status of vocational education in education system is enhancing.

(2) The continuous increase in the number of college graduates is an important indicator of the employment situation.

(3) The serious shortage of high-quality supply is the main contradiction that restricts the development of the vocational education industry.

Offcn Education Technology Co., Ltd. Annual Report 2021