Rego Interactive Co., Ltd — Regulatory Filings 2021

Aug 25, 2021

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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(a joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock code: 1065)

CHANGES IN ACCOUNTING POLICIES

The board of directors (the “ Board ”) of Tianjin Capital Environmental Protection Group Company Limited (the “ Company ”) announces that, at the 56th meeting of the eighth session of the Board of the Company convened on 25 August 2021, the Board has considered and approved the resolution in relation to the changes in accounting policies. The changes in the accounting policies are not required to be submitted to the general meeting of the Company for consideration, and the specific details of the changes in accounting policies are as follows:

I. OVERVIEW OF CHANGES IN ACCOUNTING POLICIES

The Ministry of Finance of the PRC has promulgated the Notice on the Publication of ‘The Accounting Standard for Business Enterprises No. 14’ in February 2021 for implementation with effect from the date of announcement.

The Accounting Standard for Business Enterprises No. 14 has stipulated the requirements on “the accounting treatment for the contracts of Public and Private Partnership (PPP) projects by the private investor”. The content relating to changes in the accounting treatment of the Company include the following areas;

• (1) For a private investor who provides construction services (including construction, modification and expansion) or subcontracting to other parties, it should ascertain its capacity as the major responsible person or agent in accordance with the Accounting Standard for Business Enterprises No. 14 – Revenue, carry out the corresponding accounting treatment and recognize the contract assets;

• (2) For a private investor who provides a number of services (such as provision of asset construction service for the PPP project as well as operation services and maintenance services after completion) pursuant to the contract of the PPP project, it should comply with the requirements under the Accounting Standard for Business Enterprises No. 14 – Revenue, identify the single items of contractual performance obligations, and then allocate the transaction price in proportion to the single selling price of each contractual performance obligation to each of the contractual performance obligations; and

• (3) If the private investor, pursuant to the contract terms of the PPP project, has fulfilled the conditions that entitle it to receive a definite amount of cash (or other financial assets) during the project operation period, it should recognize the amount as financial asset as long as the private investor has the right to receive such consideration (such right is only dependent on the factor of elapse of time), and carries out accounting treatment according to the requirements of the Accounting Standard for Business Enterprises No. 22 – Recognition and Measurement of Financial Instruments (hereinafter collectively known as the “ New Standard ”).

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Based on the abovementioned requirements of the Ministry of Finance of the PRC, the Company has made corresponding changes in the existing accounting polices and has commenced to implement the relevant accounting treatment from the effective date stipulated in the abovementioned document of the Ministry of Finance of the PRC. Save the aforesaid New Standard, other accounting policies of the Company remain unchanged. The aforementioned New Standard only applies to the financial statements prepared in accordance with the PRC Accounting Standards for Business Enterprises, and does not apply to the financial statements prepared in accordance with the Hong Kong Financial Reporting Standards.

II. IMPACT OF CHANGES IN ACCOUNTING POLICIES ON THE COMPANY

The management of the Company has assessed the impact of applying the New Standard on the financial statements of the Company, and has confirmed that will have the following impact: (1) the Company shall carry out reliable measurement and recognize the operating income and operating costs for the construction period of the PPP project commencing from the current year; (2) the feasibility service fees with ascertainable amount entitled to be received upon fulfillment in the PPP project shall be recognized as long-term receivables, and recognized as interest income during the period of actual receipt, and the feasibility service fees will cease to be recognized as operating income; and (3) if the PPP project adopts the financial asset model for measurement in the future, the interest expenses for the construction period cannot be capitalized.

III. CONCLUSIVE OPINIONS OF INDEPENDENT NON-EXECUTIVE DIRECTORS AND SUPERVISORY COMMITTEE

Upon consideration of the relevant content of the changes in accounting policies, the independent non-executive directors and the supervisory committee of the Company agree to the changes in accounting policies of the Company and are of the view that the changes in accounting policies are based on the stipulations of relevant documents of the Ministry of Finance and conforming to the relevant requirements of the Ministry of Finance, China Securities Regulatory Commission, Shanghai Stock Exchange and other regulatory authorities, and are able to reflect the Company’s financial conditions and operating results in a more objective and fair manner, which are in line with the interests of the Company and its shareholders. The procedures for the consideration of the changes in accounting policies follow the requirements of relevant laws and regulations and the articles of association of the Company without any prejudice to the interests of the Company and its shareholders. Thus, the changes in accounting policies are approved.

By Order of the Board Liu Yujun Chairman

Tianjin, the PRC 25 August 2021

As at the date of this announcement, the Board comprises three executive Directors: Mr. Liu Yujun, Ms. Wang Jing and Mr. Niu Bo; two non-executive Directors: Mr. Gu Wenhui and Mr. Si Xiaolong; and three independent non-executive Directors: Mr. Di Xiaofeng, Mr. Guo Yongqing and Mr. Wang Xiangfei.

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