/*ST Xinyuan: Wanxiang Xinyuan Technology Co., Ltd.’s response to the inquiry letter on the 2025 annual report

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*ST Xinyuan: Wanxiang Xinyuan Technology Co., Ltd.’s response to the inquiry letter on the 2025 annual report

Shenzhen Stock Exchange

2026/09/02

Wanxiang Xinyuan Technology Co., Ltd.

Reply to the Inquiry Letter on the 2025 Annual Report

Shenzhen Stock Exchange:

Wanxiang Xinyuan Technology Co., Ltd. (hereinafter referred to as the "Company") received the "Inquiry Letter Regarding the Annual Report of Wanxiang Xinyuan Technology Co., Ltd." (GEM Annual Report Inquiry Letter [2026] No. 40) issued by the Shenzhen Stock Exchange (hereinafter referred to as the "Shenzhen Stock Exchange") on April 29, 2026 (hereinafter referred to as the "Inquiry Letter"). The company attaches great importance to this and actively implements the issues involved in the "Inquiry Letter" one by one. The company now responds to the relevant content of the inquiry letter as follows:

Question 1. In 2025, your company was issued an unqualified audit report with a paragraph on significant uncertainty about going concern. Your company achieved operating income of 124 million yuan. In the fourth quarter, the company's operating income achieved a substantial increase. Your company stated that the main reason was the completion of on-site installation, commissioning, and acceptance of historical existing projects in the fourth quarter of 2025. Please provide additional information on the orders your company has delivered but for which revenue has not yet been confirmed as of the date of the reply, including but not limited to the amount, customer name, sales content, contract signing date, acceptance arrangements, actual payment status, etc., and combined with the above content and the status of orders on hand, explain whether your company has taken or plans to take measures to improve its ability to continue operating, and whether the relevant business is sustainable. Ask the annual audit accountant to explain the audit procedures adopted for the company's income during the reporting period, the audit scope, coverage ratio, whether the audit is restricted, whether sufficient and appropriate audit evidence is obtained, whether any abnormalities are found, etc., and express a clear opinion on the authenticity of the income.

1. Company reply:

(1) As of the date of the reply, the company’s orders that have been delivered but have not yet confirmed revenue are as follows:

Receipt amount serial number Customer name Sales content Contract amount (10,000 yuan) Contract conclusion time Estimated acceptance time

(10,000 yuan) 1 Xiamen Guoke Online Information Technology Co., Ltd. Computing server (XANB3I-E12) 1915 2026.4.8 August 2026 5.00

Auxiliary system and other equipment on the internal mixer (all

2 Haohua (Vietnam) Co., Ltd. 864.41 2023.10.31 December 2026 793.53

steel)

3 China Electric Power Research Institute Co., Ltd. Battery combustion soot treatment project 838.35 2024.9.18 June 2026 167.67 4 Shandong Haibeide Rubber Co., Ltd. Upper auxiliary engine restoration and transformation 590.00 2024.3.17 December 2026 240.00 5 Dukan New Materials (Wuhan) Group Co., Ltd. Auxiliary machines on internal mixers and automatic logistics, etc. 575.00 2023.6.5 November 2026 185.40 6 Zhaoqing Junhong Industrial Co., Ltd. Environmental protection equipment upgrade and renovation 530.00 2024.8.5 December 2026 371.00 7 Guizhou Tire Co., Ltd. Flue gas collection and treatment 460.00 2024.10.24 September 2026 278.00 8 Hubei Linglong Tire Co., Ltd. Upper auxiliary engine system, etc. 310.00 2021.1.11 December 2026 201.50 9 PTMATAHARITIREINDONESIA (Indonesia Zhongce) Upper auxiliary engine system 299.00 2024.3.28 December 2026 89.90 10 Guangxi Chiji Steel Co., Ltd. Acid wastewater treatment system 160.00 2026.1.28 September 2026 -

China Zhenhua Electronics Group Yuguang Electrical Co., Ltd. (state-owned 771

11 Cleaning line, electroplating cleaning agent 148.00 2025.06.12 December 2026 88.80

factory)

12 Jiangsu Hexing Automobile Technology Co., Ltd. Oxidation line renovation 110.00 2025.9.1 June 2026 55.00 13 Shandong Haohua Tire Co., Ltd. Fully automatic small material scale system software upgrade 100.00 2023.9.28 December 2026 68.80

Jiujiang TO tail gas combustion project desulfurization and desulfurization

14 Qian'an Jiujiang Coal Storage and Transportation Co., Ltd. 90.00 2025.8.18 October 2026 27.00

Nitrate equipment

15 Fuyao Automotive Aluminum Parts (Fujian) Co., Ltd. Film stripping tank maintenance 75.00 2025.10.15 May 2026 67.50 16 Fuyao Aluminum Parts (Changchun) Co., Ltd. Paint stripping line 55.00 2025.6.19 December 2026 33.00 17 Beijing Muchengshu Technology Co., Ltd. Unloading equipment 49.60 2021.3.31 December 2026 - 18 Qian'an Jiujiang Coal Storage and Transportation Co., Ltd. High-density pool fiberglass shed 45.00 2025.12.11 June 2026 13.50 19 Shandong Haohua Tire Co., Ltd. Upgrade and transformation 45.00 2024.2.2 December 2026 26.19 20 Anhui Shunhao New Material Technology Co., Ltd. Control system 38.00 2024.10.9 June 2026 22.80 21 Hefei Wanli Tire Co., Ltd. Bag filter modification 33.00 2024.9.26 June 2026 19.80 22 Hangzhou Zhongce Qingquan Industrial Co., Ltd. Metering auger system 21.00 2024.2.4 July 2026 6.30 23 Yantai Zhenghai Magnetic Materials Co., Ltd. Program transformation 16.00 2025.12.30 June 2026 8.00 24 Fuyao Automobile Aluminum Parts (Fujian) Co., Ltd. Oxide black sunroof guide rail program 14.50 2025.11.30 June 2026 4.35 25 Fuyao Aluminum Parts (Changchun) Co., Ltd. Oxidation line 1 driving transformation 13.00 2025.9.17 June 2026 - 26 Fuyao Aluminum Parts (Changchun) Co., Ltd. Paint stripping line and swing device 10.00 2025.11.28 June 2026 - 27 Tangshan Haochen Ruike Automation Technology Co., Ltd. Silo 9.96 2025.12.9 November 2026 8.69 28 Triangle Tire Co., Ltd. Carbon black transportation system renovation 8.00 2024.10.23 June 2026 7.20 29 Triangle Tire Co., Ltd. Weihai Huamao Rubber Science and Technology Branch Carbon black transportation system renovation 8.00 2024.10.23 June 2026 - 30 Triangle Tire Co., Ltd. Weihai Huayang Rubber Technology Branch Carbon black delivery system transformation 8.00 2024.10.23 August 2026 7.20 31 Fuyao Aluminum Parts (Changchun) Co., Ltd. Oxidation line overcar transformation 6.50 2025.11.28 June 2026 - 32 Fuyao Aluminum Parts (Changchun) Co., Ltd. 2 sets of film stripping tank heating coils and 2 sets of lead screws 5.66 2025.11.30 May 2026 - 33 Linglong International Tire (Thailand) Co., Ltd. Qualification rate statistical transformation 1.35 2025.1.23 June 2026 1.18

Total 7452.34 2797.32

As of the date of the reply, the company had a total order amount of 111.99 million yuan, of which the order amount that has been delivered but has not yet confirmed revenue is 7452.34 million (see table above). The orders mainly cover core business areas such as intelligent conveying batching equipment, green environmental protection equipment, software information and communication technology, and waste tire pyrolysis resource utilization products. Customers are mainly distributed in rubber, environmental protection and other industries. Among them, tire and rubber intelligent equipment customers include Linglong Tire, Haohua Tire, Triangle Tire, Zhongce Rubber, etc. Mainly with long-term cooperation with leading tire companies, the cooperation is stable and the repurchase rate is high; green environmental protection equipment products are in line with the "double carbon" policy orientation, and most of the customers are large enterprises with low credit risks and strong payment capabilities; the software information and communication technology business is a new business introduced by industrial investors. Some orders have been delivered as scheduled, and the rest of the orders on hand are being arranged in an orderly manner.

(2) Based on the above content and the status of orders on hand, explain whether the company has taken or plans to take measures to improve its ability to continue operating and whether the relevant business is sustainable.

Relying on the empowerment of industrial investors and combined with the status of orders in hand, the company has formulated the following key improvement measures from market development, customer relationship repair, delivery and performance, and financial guarantee:

Increase market development and stabilize business fundamentals

The company has sufficient reserves of orders on hand. As of the date of reply, the total number of orders on hand was RMB 111.99 million. The company's management team visited important customer teams on-site and tracked the project value of approximately 200 million yuan, including major bidding projects such as Triangle Tire, Linglong Tire, Zhongce Rubber, and Fuyao Glass. Among them, 2 projects were confirmed to be successful bidders (under contract), 3 second-round bidding projects, and multiple projects are in the critical business negotiation period. The existing order reserve lays a solid performance foundation for the company's continued operations and ensures stable operating cash flow.

At the same time, the company will actively promote its international development strategy, stabilize existing customers in the domestic market, and develop incremental business in overseas markets. Relying on the resources of industrial investors, we will cooperate with leading domestic tire companies to develop customers for factory construction in Southeast Asia, Africa, South America and other overseas regions.

Actively promote project delivery, perform contracts on time, and follow up on project payment collection

The average performance period of the company's orders on hand is 6-12 months, and the acceptance time is expected to be mainly concentrated in the second half of 2026. To this end, the company will further strengthen project management, promote delivery, and complete performance on time to ensure smooth flow of cash flow.

As of the date of the reply, the company has delivered a total of 27.9732 million yuan in unconfirmed revenue orders, and the collection of large orders is in good condition. With the implementation of new businesses, the company's operating cash flow will continue to improve.

With the empowerment of industrial investors, traditional business production capacity has been steadily restored, and new businesses have been implemented in an orderly manner.

The company's pre-reorganization work is progressing in an orderly manner, and investors have introduced RMB 37.8 million in mutual bonds and cash donations of RMB 312 million, significantly supplementing the company's liquidity; the company has optimized its management team, improved internal controls, and broadened market channels.

(1) Traditional business: Subsidiaries Ningxia Wanxiang and Tianjin Wanxiang have resumed work and production. Relying on the support of orders on hand, production capacity utilization continues to rebound.

(2) Rapid implementation of software information and communication technology business: As of the date of reply, under the leadership of industrial investors, subsidiary Jiangxi Ruiyuan Information Technology Co., Ltd. (hereinafter referred to as "Ruiyuan Information") has signed a project development contract worth 55.43 million yuan. In the future, Ruiyuan Information will gradually improve the construction of its own team and qualification system, and strive to be qualified to directly bid for large-scale state-owned enterprise general contracting projects in the second half of 2026.

(3) The first order of the industrial robot business has been completed, and new business orders are being advanced in an orderly manner.

Supporting safeguard measures to strengthen operational stability

(1) Cost reduction, efficiency improvement and process streamlining: Promote procurement price comparison, strict cost control, and approval optimization to continuously reduce operating costs.

(2) Special incentive mechanism: Establish new business development awards and project payment collection awards to effectively encourage business teams to quickly expand the market and promote order placement and payment collection.

(3) Strengthen the collection of accounts receivable: Establish a "special account collection class" to determine classification, graded collection policies and incentive policies for existing receivables.

To sum up, at this stage, the company has sufficient orders on hand, high-quality cooperative customers, and a diversified order structure; coupled with the financial and resource empowerment of industrial investors, the two-way development of new and old businesses, and the steady recovery of production capacity, as the company's pre-reorganization work is advanced in an orderly manner, the company's business is sustainable.

2. Annual audit accountant’s verification:

(1) Regarding the company’s income during the reporting period, we performed the following verification procedures:

Understand the key internal controls related to operating income, evaluate the design and implementation of relevant internal controls, and test the effectiveness of their operation;
Obtain sales contract samples from major customers, and check the main terms including business cooperation methods, delivery and acceptance, settlement, etc., to evaluate whether the company's operating income recognition policy meets the requirements of relevant corporate accounting standards;
Select samples of recorded and confirmed operating income transactions, and perform detailed testing procedures, including checking sales contracts, outbound orders, logistics orders, acceptance orders, bank transaction statements, and value-added tax invoices, and evaluating whether relevant revenue recognition complies with the company's accounting policies for revenue recognition; we conducted a comprehensive audit of operating income in 2025, and the amount of detailed testing was RMB 112.672 million, accounting for 90.92% of operating income.
Perform analytical procedures such as gross profit margin changes on recorded and confirmed sales revenue, combined with costs, and compare with history and the same industry, and judge the rationality of gross profit margin and revenue changes based on the company's actual operating conditions;
Based on the characteristics and nature of customer transactions, combined with accounts receivable, confirm the sales amount and accounts receivable balance of major customers, and effectively control the confirmation process; in 2025, the operating income is 123.9294 million yuan, the amount that can be confirmed in the reply letter is 112.4759 million yuan, accounting for 90.76% of the operating income, and the amount that can be confirmed by executing the alternative testing procedure is 10.6083 million yuan, accounting for 90.76% of the operating income. 8.56%. The total amount confirmed through correspondence and alternative testing procedures was 123.0842 million yuan, accounting for 99.32% of the operating income.
Conduct on-site visits and background investigations on major customers to understand the business cooperation background, development and historical transactions, and analyze and judge the commercial rationality of the transactions; the number of customers we visited was 30, and the revenue recognized by the customers visited in 2025 was 92.6147 million yuan, accounting for 74.73% of the operating revenue in 2025.
Obtain the list of related party relationships and transactions, check the integrity of related party relationships through public channels such as the National Enterprise Credit Information Disclosure System and Qichacha, and verify the accuracy and completeness of related party transactions;
Implement cut-off testing on the operating income recognized before and after the balance sheet date to check whether the operating income is recorded and recognized within the appropriate period;
Based on the bank account flow after the balance sheet date, perform post-collection check of accounts receivable;
Check the adequacy and completeness of the company’s disclosures related to revenue recognition in the notes to the financial statements.

(2) Verification opinions

Based on the audit procedures performed above and the audit evidence obtained, we believe that the company's management's relevant judgments on revenue recognition are reasonable, and the presentation and disclosure of revenue recognition are appropriate. During this audit, there was no restriction on the scope of the audit. The company's 2025 operating income recognition complies with the "Accounting Standards for Business Enterprises No. 14 - Revenue" and relevant regulations. The income transactions are true, accurate and complete, and the authenticity of the income can be confirmed.

Question 2. At the end of the reporting period, your company's book balance of accounts receivable was 641 million yuan, of which the book balance of accounts receivable over 3 years was 550 million yuan; the ending balance of bad debt provisions was 547 million yuan, of which 124 million yuan was accrued in the current period, 10.005 million yuan was recovered or transferred back, and 3.8346 million yuan was written off. Please ask your company to:

(1) Combined with factors such as the aging distribution of accounts receivable, customer credit status, industry characteristics, historical loss rates of accounts receivable in previous years calculated based on the migration model, adjustments and basis for forward-looking information, overdue accounts receivable at the end of the reporting period in the past three years, payment collection after the period, provision for bad debt provisions for comparable companies in the same industry, etc., explain whether the provision for bad debt provisions for accounts receivable is reasonable and sufficient, and whether it complies with the relevant provisions of the Accounting Standards for Business Enterprises.

(2) Describe the specific situation of the recovery or reversal, write-off, and other changes in the impairment provision for receivables during the reporting period, including but not limited to the time of provision for bad debts in the previous period, and the specific reasons and basis for the change.

The annual audit accountant is requested to verify the above issues and express clear opinions, and explain the audit procedures and coverage, effectiveness of the procedures and audit conclusions performed on the authenticity of accounts receivable, timeliness and adequacy of bad debt provisions.

1. Company reply:

(1) Combined with factors such as the aging distribution of accounts receivable, customer credit status, industry characteristics, historical loss rates of accounts receivable in previous years calculated based on the migration model, forward-looking information adjustments and basis, overdue accounts receivable at the end of the reporting period in the past three years, subsequent payment collections, bad debt provisions of comparable companies in the same industry and other factors, explain whether the provision of bad debt provisions for accounts receivable is reasonable and sufficient, and whether it complies with the relevant provisions of the Accounting Standards for Business Enterprises.

The company’s aging distribution of accounts receivable based on aging combinations in the past three years

(Unit: 10,000 yuan)

Project December 31, 2025 December 31, 2024 December 31, 2023 Within 1 year 2,908.42 3,683.37 7,014.41 1-2 years 2,834.43 2,152.50 17,282.61 2-3 years 1,874.32 4,057.53 20,468.25 3-4 years 3,459.67 2,927.51 7,343.57 4-5 years 723.57 5,847.05 4,943.66 More than 5 years 4,469.77 4,415.57 9,274.17

Subtotal 16,270.18 23,083.52 66,326.67

Less: Bad debt provision 9,303.59 13,902.12 35,102.30

Total 6,966.59 9,181.40 31,224.37

Customer credit status and industry characteristics

The company is deeply involved in the field of digital intelligent equipment manufacturing. It is mainly engaged in industrial intelligent conveying and batching systems and belongs to the rubber tire intelligent equipment manufacturing industry. Its core products and services cover intelligent conveying and batching equipment, green environmental protection equipment, intelligent special equipment, and waste tire pyrolysis resource utilization products. The business adopts a non-standard customized business model, which implements sales-based production and production-based ordering. Plans are customized according to customers' individual needs, procurement and production, on-site installation and commissioning, and acceptance and delivery. Downstream customers are mainly well-known domestic and foreign tire companies such as Linglong Tire, Hankook Tire, Triangle Tire, Zhengxin Rubber, and Zhongce Rubber. The customers are strong, well-qualified, stable in cooperation, and have low credit risks.

The company has been developing new business areas such as digital information and silicon purification since 2020. This type of business is still in the early stages of development. Downstream customer industries are fragmented, operating scale and cash flow stability are uneven. In addition, new business models and technology applications are highly innovative, and industry standards are not yet mature. Customer performance and repayment uncertainties are high, and the overall credit risk is higher than that of traditional smart equipment business.

Historical loss rate of accounts receivable, adjustment of forward-looking information and basis

(1) Recognition method of expected credit loss rate

In accordance with the provisions of "Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments (Revised in 2017)", the company calculates the historical loss rate based on the credit loss migration model and adjusts forward-looking factors on this basis to calculate and confirm the expected credit loss rate. Specific processes and methods:

① The company combines the aging and collection status of accounts receivable to calculate the proportion of accounts receivable that are not collected in each year and are migrated to the next year, that is, the migration rate;

② Use the migration rate to calculate the historical loss rate of aging portfolio accounts receivable;

③Based on the principle of prudence, combined with current market conditions and predictions of future conditions, the expected loss rate is appropriately revised, and the historical loss rate is appropriately adjusted.

(2) The company’s historical loss rate and adjustments to forward-looking information

Step 1: The company accrues bad debt provisions on a portfolio basis and incorporates the accounts receivable calculated by the migration rate model into

(Unit: 10,000 yuan)

Project December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 Within 1 year 9,350.73 4,476.80 3,683.37 2,908.42 1-2 years 5,138.15 4,847.23 2,152.50 2,834.43 2-3 years 1,917.53 2,954.42 4,057.53 1,874.32 3-4 years 1,578.26 930.91 1,141.75 3,459.67 4-5 years 1,650.81 1,253.41 764.23 1,116.16 More than 5 years 3,772.21 4,680.24 4,760.60 4,814.80

Total 23,407.69 19,143.02 16,559.97 17,007.80

Step 2: Migration rate of company’s accounts receivable

Project Migration from 2022 to 2023 Migration from 2023 to 2024 Migration from 2024 to 2025 Average migration rate within 1 year 51.84% 48.08% 76.95% 58.96% 1-2 years 57.50% 83.71% 87.08% 76.09% 2-3 years 48.55% 38.65% 85.27% 57.49% 3-4 years 79.42% 82.09% 97.76% 86.42% 4-5 years 71.36% 90.19% 78.41% 79.99% More than 5 years 92.84% 77.56% 88.55% 86.32% Step 3: Expected credit loss rate of the company’s accounts receivable for the current period

Historical credit loss rate Forward-looking estimate adjustments Expected credit loss rate items

(A) (B) (C=A*(1+B)) Within 1 year 15.39% 10.00% 16.93% 1-2 years 26.10% 10.00% 28.71% 2-3 years 34.30% 10.00% 37.73% 3-4 years 59.67% 10.00% 65.64% 4-5 years 69.04% 10.00% 75.95% More than 5 years 86.32% 10.00% 100.00%

Note: In order to maintain an inertia, the company extends the adjustment ratio of forward-looking estimates by 10% over the past years, and the expected credit loss rate for more than 5 years is adjusted to 100%.

Overdue accounts receivable and payment collection after the period in the past three years at the end of the reporting period

(1) Overdue accounts receivable in the past three years

(Unit: 10,000 yuan) Year balance Overdue amount Amount collected after the period Amount not collected after the period 2025-12-31 64,129.41 61,220.99 423.47 60,797.52 2024-12-31 65,205.53 61,050.32 2,631.15 58,419.17 2023-12-31 84,039.43 77,025.02 8,629.34 68,395.68

Note: The post-period collection amount of accounts receivable at the end of 2023 and 2024 is the collection amount of the next year, and the post-period collection amount of accounts receivable at the end of 2025 is the collection amount from January to April 2026.

The main customers who are overdue and have not paid back after the due date are as follows:

(Unit: 10,000 yuan)

Overdue payment period Year after overdue payment period Customer name Balance of accounts receivable Overdue amount

Amount of subsequent payment Unrepaid amount in 2025 Jiangxi Shixing Technology Co., Ltd. 12,291.37 12,291.37 - 12,291.37 Fuzhou Clintair Environmental Protection Technology Co., Ltd. 11,805.00 11,805.00 - 11,805.00 Shangrao Chongrong Supply Chain Management Co., Ltd. 8,870.00 8,870.00 - 8,870.00 Guizhou Radio and Television Information Network Co., Ltd.

7,261.17 7,261.17 - 7,261.17 Sifuquan City Branch

Clintaier (Anqing) Environmental Protection Technology Co., Ltd. 2,940.00 2,940.00 - 2,940.00

Subtotal 43,167.54 43,167.54 - 43,167.54

Jiangxi Shixing Technology Co., Ltd. 13,151.37 13,151.37 860.00 12,291.37 Fuzhou Clintair Environmental Protection Technology Co., Ltd. 12,005.00 12,005.00 200.00 11,805.00 Shangrao Industrial and Financial Supply Chain Management Co., Ltd. 8,870.00 8,870.00 - 8,870.00 2024 Guizhou Radio and Television Information Network Co., Ltd.

7,261.17 7,261.17 - 7,261.17 Sifuquan City Branch

Clintaier (Anqing) Environmental Protection Technology Co., Ltd. 2,940.00 2,940.00 - 2,940.00

Subtotal 44,227.54 44,227.54 1,060.00 43,167.54

Jiangxi Shixing Technology Co., Ltd. 13,151.37 13,151.37 - 13,151.37 Fuzhou Clintair Environmental Protection Technology Co., Ltd. 12,100.00 12,100.00 95.00 12,005.00 Shangrao Industrial and Financial Supply Chain Management Co., Ltd. 8,950.00 8,950.00 80.00 8,870.00 2023 Guizhou Radio and Television Information Network Co., Ltd.

7,261.17 7,261.17 - 7,261.17 Sifuquan City Branch

Clintaier (Anqing) Environmental Protection Technology Co., Ltd. 2,940.00 2,940.00 - 2,940.00

Subtotal 44,402.54 44,402.54 175.00 44,227.54

For the above overdue customers who have not received payment, the company has analyzed the specific situation of the customers during the reporting period.

Provision for bad debts is made individually.

(2) Collection of accounts receivable after the period

The original value of the company's accounts receivable and subsequent payment collection in the past three years are as follows:

(Unit: 10,000 yuan)

Annual balance of accounts receivable Collection after the period Proportion of collection after the period to the balance receivable2025-12-31 64,129.41 719.57 1.12%

2024-12-31 65,205.53 3,136.38 4.81%

2023-12-31 84,039.43 13,036.36 15.51%

Note: The amount of repayment of accounts receivable at the end of 2023 and the end of 2024 is the repayment amount of the next year. The receivable amount at the end of 2025

The repayment after the account period is the repayment amount from January to April 2026.

Provision for bad debts of comparable companies in the same industry

(1) Comparison of bad debt provision ratio with the same industry

This time, three comparable listed companies in the same industry, namely Soft Control Co., Ltd., Saixiang Technology, and Lanying Equipment, were selected for comparison.

The entity compares the expected credit loss rates corresponding to the accounts receivable of each company. The specific situation is as follows:

Comparable companies in the same industry

Aging Xinyuan Technology

Ruankong Co., Ltd. Saixiang Technology Lanying Equipment Average

Within 1 year 2% 5% 3% 3.33% 16.93% 1-2 years 5% 10% 10% 8.33% 28.71% 2-3 years 10% 30% 30% 23.33% 37.73% 3-4 years 50% 80% 100% 76.67% 65.64% 4-5 years 80% 80% 100% 86.67% 75.95% More than 5 years 100% 80% 100% 93.33% 100%

The table above shows that the expected credit loss rates used by the company for accounts receivable aged less than 1 year, 1-2 years, and 2-3 years are significantly higher than the industry average; the expected credit loss rates used for accounts receivable aged 3-4 years, and 4-5 years are slightly lower than the industry average; and the expected credit loss rates used for accounts receivable aged more than 5 years are basically consistent with the industry average.

(2) Comparison with bad debt provisions of listed companies in the same industry

Company name Accounts receivable (10,000 yuan) Bad debt provision (10,000 yuan) Bad debt provision ratio

Soft Control 175,319.64 29,666.11 16.92%

Saixiang Technology 43,441.69 14,874.78 34.24%

Lanying Equipment 12,252.41 7,256.22 59.22%

Average 77,004.58 17,265.70 36.79%

Xinyuan Technology 64,129.41 54,678.44 85.26%

Note: Lanying equipment data comes from the smart rubber equipment business portfolio data disclosed in the company's 2025 annual report.

As shown in the table above, the company's overall bad debt provision ratio is 85.26%, which is significantly higher than the average level of 36.79% for comparable companies in the same industry, and also higher than Lanying Equipment (59.22%), Saixiang Technology (34.24%), and Soft Control (16.92%).

(3) Analysis of the reasonableness and adequacy of bad debt provision for accounts receivable

Combining the company's customer structure and business characteristics, the company calculated the bad debt provisions for accounts receivable according to the expected credit loss rate model in accordance with the financial instrument standards. The bad debt provisions for accounts receivable set aside by the company are reasonable and sufficient, and comply with the relevant provisions of the Accounting Standards for Business Enterprises.

(2) Explain the specific situation of the recovery or reversal, write-off, and other changes in the impairment provision for receivables during the reporting period, including but not limited to the time of provision for bad debts in the previous period, and the specific reasons and basis for the change.

The company’s bad debt provisions accrued, recovered or reversed during the current period are as follows:

(Unit: 10,000 yuan) Amount of changes in the current period

Category Beginning Balance Ending Balance

Provision Recovery or transfer Write-off Others

Individual provision for bad debts

Accounts receivable 29,804.98 10,497.33 1,000.50 383.46 6,456.49 45,374.85

Provision for bad debts based on combination

13,902.12 1,857.96 -6,456.49 9,303.59 Accounts receivable

Among them: Combination 2 13,902.12 1,857.96 -6,456.49 9,303.59

Total 43,707.10 12,355.29 1,000.50 383.46 54,678.44

Impairment provisions for receivables recovered or transferred back during the reporting period

In the early stage, based on risk signs such as overdue payment from each customer, tight operating cash flow, and weak solvency, the company strictly followed the provisions of the "Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments" to individually assess the credit risk of relevant receivables and accrue bad debt provisions in a corresponding proportion. During the reporting period, customers paid off historical overdue debts. After the company actually received the payment, it correspondingly reversed the impairment provision that had been made in the previous period. This reversal/recovery has a real basis for payment. The specific circumstances and reasons for the changes are as follows:

(Unit: 10,000 yuan) Reduction or transfer back

Unit name Amount recovered Reason for reversal or recovery Time of provision for bad debts in the previous period

value reserve amount

Jiangxi Shixing Technology Co., Ltd. 860.00 860.00 Bank transfer 100% of the individual recognition accrual in 2022 Fuzhou Clintair Environmental Protection Technology Co., Ltd. 200.00 100.00 Bank transfer 50% of the individual recognition accrual in 2024 Sichuan Coal and Coking Group Co., Ltd. 80.00 40.00 Bank transfer, acceptance 50% of the provision for individual recognition in 2024 Shandong Zhongyi Rubber Co., Ltd. 0.50 0.50 The acceptance discount interest is reversed 100% of the provision for individual recognition in 2021

Total 1,140.50 1,000.50

Write-off of accounts receivable during the reporting period

During the reporting period, the company wrote off a total of RMB 3.8346 million in accounts receivable, and all write-offs were long-term overdue claims. It is verified that the debtor has been canceled or revoked, so it has lost its ability to operate and repay debts, and there is no possibility of recovery of the money. According to the "Accounting Standards for Business Enterprises", the company will write it off after completing the internal approval procedures. The basis for the write-off is sufficient and the procedures are compliant. The details are as follows:

(Unit: 10,000 yuan)

Unit name Amount written off Reason for writing off Write-off procedures performed Early bad debt accrual time Shandong Guopeng Rubber Co., Ltd. 149.40 The company has been canceled Management approval 100% has been accrued in 2019

Baili Rubber Tire Co., Ltd. 118.22 The company has been deregistered and approved by the management. 100% has been accrued in 2018

The company has been revoked

Shandong Yongtai Group Co., Ltd. 99.62 Management approval 100% has been provided in 2018

business license

Shandong Energy Equipment Group Laiwu Equipment Manufacturing

12.60 The company has been cancelled. The management has approved the individual determination of 100% provision for the company in 2024.

Guilin Huagong Baichuan Technology Co., Ltd. 3.60 The company has been canceled and approved by the management. 100% has been provided in 2015

Zhejiang Xiantong Auto Parts Co., Ltd. 0.01 The company has been cancelled. Approved by management. 100% provision for individual determination in 2023. Total 383.46

Other changes in the provision for impairment of accounts receivable during the reporting period

The balance of accounts receivable of Fuquan Branch of Guizhou Radio and Television Information Network Co., Ltd. is 72.6117 million yuan. At the end of 2024, bad debt provisions of 64.5649 million yuan were accrued based on the aging risk characteristics of the aging portfolio. During the 2025 reporting period, the company combined its operating conditions, payment performance and debt risk changes to transfer the accounts receivable from the aging portfolio accrual category to the individual accrual category, and based on The provision of impairment provisions at a 100% ratio resulted in an increase of RMB 64.5649 million in individual provision for bad debts and a decrease of RMB 64.5649 million in collective provision for bad debts.

The above changes are only adjustments to the classification of impairment provisions and do not increase or decrease the company's overall bad debt provision balance.

2. Annual audit accountant’s verification:

(1) In response to the above matters, we have implemented the following verification procedures:

Understand, evaluate and test the design and operating effectiveness of internal controls related to daily management of receivables and collectability assessment. These internal controls include customer credit risk assessment, accounts receivable collection process, identification of events that trigger impairment of accounts receivable, and estimation of the amount of bad debt provisions, etc.;
Review the management’s judgments and estimates in assessing the recoverability of accounts receivable, including management’s basis for determining the portfolio of accounts receivable, the judgment of separately accruing bad debt provisions, etc., and pay attention to whether management has fully identified items that have been impaired. Understand the operating status of the enterprise through public information inquiry, verify the operating continuity of the accounts receivable unit, risk abnormalities and other actual operating conditions, and verify the authenticity and collectability of the write-off amounts and accounts receivable that have been individually recognized as bad debts;
Obtain and compile a detailed list of accounts receivable, and check the supporting documents related to the confirmation of accounts receivable on a sampling basis, including sales contracts, outbound orders, acceptance orders, etc.; check the bank invoices and bill collection vouchers for payment withdrawals on a sampling basis, and compare whether the progress of payment collection in the contract matches the contract agreement;
Obtain the aging breakdown of accounts receivable, test the accuracy of the aging of accounts receivable for which bad debt provisions are made based on aging combinations, and recalculate the amount of bad debt provisions based on the expected credit loss rate to see if it is accurate;
Evaluate whether the expected credit loss rate adopted by management is appropriate by referring to historical credit loss experience, combined with current conditions and judgments of future economic conditions;
Execute the confirmation procedure for important accounts receivable. The amount of letters issued in 2025 is 590.0425 million yuan, and the amount that can be confirmed in the reply letter is 353.6357 million yuan, accounting for 92.01% and 55.14% of the balance of accounts receivable at the end of the period respectively. Implement alternative testing procedures for units that have not responded to the letter and check relevant supporting documents, including sales contracts or orders, sales invoices, customer acceptance forms, payment receipts, etc. Through the alternative testing procedures, 233.0577 million yuan was confirmed, accounting for 36.34% of the balance of accounts receivable at the end of the period. The total amount confirmed through correspondence confirmation and alternative testing procedures was 586.6934 million yuan, accounting for 91.48% of accounts receivable.
Conduct random inspections on the collection of accounts receivable after the period;
Check accounts receivable and other information of comparable listed companies, and conduct comparative analysis with the company;
Check and evaluate whether the presentation of accounts receivable is appropriate and sufficient.

(2) Verification opinions

Based on the above-mentioned audit procedures and the audit evidence obtained, we believe that the company's management's relevant judgments and estimates on the collectability of accounts receivable are reasonable, and the company's bad debt provisions are timely and sufficient.

Question 3. The reply to the "Inquiry Letter" shows that your company has made provision for fixed asset impairment of RMB 76.2506 million in the current period. The main consideration is that the production capacity of the subsidiaries is underutilized, most of which are idle, and there are obvious signs of impairment. Please explain to your company the order status of its subsidiaries Wanxiang Xinyuan (Ningxia) Intelligent Environmental Protection Technology Co., Ltd. (hereinafter referred to as Ningxia Wanxiang) and Tianjin Wanxiang Xinyuan Technology Co., Ltd. (hereinafter referred to as Tianjin Wanxiang) as of the reply date, including customer name, contract signing time, contract amount, sales content, estimated delivery time, etc., and discuss whether Ningxia Wanxiang and Tianjin Wanxiang have the ability to continue operating, and whether the impairment of related fixed assets is sufficient and timely. Ask the annual audit accountant to verify and issue a clear opinion.

1. Company reply:

(1) Tianjin Wanxiang’s orders on hand and sustainable operating capabilities as of the date of reply

Tianjin Wanxiang’s orders on hand as of the date of reply:

Order Contract Amount

Customer name Sales content Contract conclusion time Status

No. (10,000 yuan)

1 Beijing Muchengshu Technology Co., Ltd. Cutting equipment 49.60 2021/3/31 Pending acceptance

Beijing Aerospace Lansu Agriculture and Animal Husbandry Machinery Co., Ltd.

2 Picking machine 36.00 2025/9/11 In progress

company

Tangshan Haochenruike Automation Technology Co., Ltd.

3 Silo 9.96 2025/12/9 Pending acceptance

Ltd.

October 2025-2026 2 orders in progress (17.32 4 Wanxiang Xinyuan Technology Co., Ltd. Processed parts 70.09

million) in April 2018, and the rest have been shipped. 5 Wanxiang Xinyuan Technology Co., Ltd. Processed parts 315 May 2026

Total 480.66

Discussion of sustainable operating capabilities

After Tianjin Wanxiang resumed production at the end of 2025, under the management and supervision of production investors, significant progress has been made in team building and sales expansion, and it has the ability to operate sustainably, mainly reflected in the following aspects: (1) Healthy cash flow and recovery of self-hemopoiesis ability

1 It is expected that the net cash flow from operating activities in 2026-2028 will be positive and can cover cash outflows (see the table below);

2 As the order volume continues to grow, the company's cash flow situation will further improve.

Tianjin Wanxiang operating cash flow forecast table (period: 2026-2028)

(Unit: 10,000 yuan)

Project 2026 2027 2028

1. Cash inflow

Cash inflow from operating activities 2,800.00 3,080.00 3,388.00 Operating income 2,800.00 3,080.00 3,388.00

2. Cash outflow

Cash outflow from operating activities 2,214.54 2,378.82 2,559.52 A. Cash payment for material purchase 1,400.00 1,540.00 1,694.00 B. Wages of production workers 409.00 409.00 409.00 C. Wages of other personnel 88.00 88.00 88.00 D. Various indirect expenses 74.20 81.62 89.78 E. Other costs such as production of fuel and power 137.76 151.54 166.69 F. Cash payment of various taxes 105.58 108.66 112.05 III. Net cash flow from operating activities 585.46 701.18 828.48 Note: The relevant assumptions for the cash flow forecast from operating activities are as follows:

The order execution progress is based on the orders on hand and the expected new orders, and the revenue is confirmed according to the contract. The new orders are expected to be orders from affiliated companies and necessary external orders (Tianjin Wanxiang is an important production base of the joint-stock company, and the main orders come from the production tasks of undertaking orders from the joint-stock company and related brother companies);

2 According to historical experience, the average payment cycle is 30-60 days;

3 The source of cash inflow is mainly operating business income, and there is no significant risk of overdue accounts receivable during the forecast period;

4 Cash outflows from operating activities are based on historical data from 2023 to 2025 and the current operating plan.

(2) Solid foundation support

1 As an important manufacturing base of the company, Tianjin Wanxiang has good equipment and stable production capacity, which can ensure the orderly delivery of orders.

The suppliers are stable and the warehousing system management is standardized.

3 Safety and environmental protection compliance, no major safety accidents.

(3) Stable customers and sufficient orders

The company has sufficient orders on hand. As the company's business recovers, Tianjin Wan's orders for the second half of the year are expected to exceed 20 million yuan.

(4) The organizational structure and personnel structure are stable

Tianjin Wanxiang has a complete organizational structure, clear division of department responsibilities, sufficient reserves of core technical personnel and management personnel, and employee skill levels that can meet production and operation needs and ensure the company's normal operations.

In summary, Tianjin Wanxiang has sufficient orders on hand, its net cash flow forecast from operating activities in the next 12 months is positive, and it has the ability to continue operating.

(2) Ningxia Wanxiang’s orders on hand and sustainable operating capabilities as of the date of reply

Ningxia Wanxiang’s orders on hand as of the date of reply:

Contract amount

Serial number Customer name Sales content Contract signing date Status (10,000 yuan)

1 Suzhou Tianyao Chemical Co., Ltd. Carbon black 1,026 2025-10-28 470 tons delivered 2 24.75 2026-02-06

3 24.75 2026-03-15

Jiangsu Ruida Machinery Technology Co., Ltd. Carbon black 300 tons delivered 4 24.75 2026-04-06

5 33 2026-05-08

6 Sino-German (Yangzhou) Conveying Engineering Technology Co., Ltd. Carbon black 9 2026-04-17 All delivered 7 Hebei Shengyuan Tire Co., Ltd. Carbon black 8.4 2026-04-19 All delivered 8 Shuangqian Group (Jiangsu) Tire Co., Ltd. Carbon black 38.7 2026-04-28 All delivered

9 Jiangsu Huaan Rubber Technology Co., Ltd. Carbon black 1.525 2026-05-08 All delivered10 Sino-German (Yangzhou) Conveying Engineering Technology Co., Ltd. Carbon black 9 2026-05-18 All delivered Total 1,199.875

Discussion of sustainable operating capabilities

After Ningxia Wanxiang resumed production in December 2025, with the support of industrial investors, it has made significant progress in team building, lean production, and sales channels. It now has sustainable operating capabilities, which is mainly reflected in the following aspects:

(1) The production end has fully resumed production, and the main business has resumed normal operations.

Ningxia Wanxiang fully resumed work and production in December 2025. The production lines are scheduled for normal production; core personnel are stable and production and operation order is restored; raw material procurement channels are smooth, the upstream and downstream supply chains are stable, normal production conditions are in place, and the production capacity foundation is solid. Ningxia Wanxiang has a total of 6 carbon black production lines, which are mainly advanced, intelligent, high-end and refined. The technology is at the leading level in the industry. The current daily output reaches 70 tons and the annual output of 20,000 tons of recycled carbon black; the maximum annual output can be expanded to 40,000 tons. It has strong production and delivery capabilities.

(2) Diversified customer structure and sufficient orders on hand

Cooperation with high-quality downstream customers is stable. Ningxia Wanxiang has reached stable cooperation with key customers Jiangsu Shuangqian, Jiangsu Ruida, Zhongde (Yangzhou), Hebei Shengyuan Tire, etc., with sufficient orders on hand and intended orders. Since the resumption of work and production, a total of 955 tons of carbon black has been delivered, with good sales returns and stable market demand.

Ningxia Wanxiang is actively exploring the market. In addition to tire and rubber manufacturers, it has also expanded into transportation engineering companies, railway transportation and other fields. It is currently negotiating with Hebei Tongchuang and China Railway Construction to establish a strategic cooperation framework agreement to reduce the risk of cyclical fluctuations in a single industry.

(3) Cash flow can cover daily operating expenses

1 According to the comprehensive judgment and forecast of the company's management, and based on the asset appraisal report issued by Northern Asia Asset Appraisal Co., Ltd. (hereinafter referred to as "Northern Asia"), it is expected that the net cash flow from operating activities in 2026-2028 will be positive and can cover the cash outflow;

2 As the order volume continues to grow, the company's cash flow situation will further improve.

(4) The organizational structure and personnel structure are stable

Ningxia Wanxiang has a complete organizational structure, clear division of department responsibilities, sufficient reserves of core technical personnel and management personnel, and employee skill levels that can meet production and operation needs and ensure the company's normal operations.

To sum up, Ningxia Wanxiang has sufficient orders on hand, its net cash flow forecast from operating activities in the next 12 months is positive, and it has the ability to continue operating.

(3) Whether the impairment of related fixed assets of Ningxia Wanxiang and Tianjin Wanxiang is sufficient and timely

Impairment of fixed assets related to Tianjin Wanxiang

(1) Basic information on fixed assets

The company's fixed assets include houses and buildings, machinery and equipment, transportation equipment, office equipment and others. The depreciation policy and details as of the end of the reporting period are as follows:

Category Depreciation method Depreciation life (years) Salvage value rate (%) Annual depreciation rate (%) Houses and buildings Straight-line method 20-40 5 2.38-4.75 Machinery and equipment Straight-line method 3-10 5 9.5-31.67 Transportation equipment Straight-line method 4-10 5 9.50-23.75 Office equipment and others Straight-line method 3-5 5 19.00-31.67 (unit: 10,000 yuan)

Category Original book value Accumulated depreciation Book value Proportion of book value to original value Houses and buildings 7,595.10 1,993.26 5,601.84 73.76% Machinery and equipment 3,112.12 2,530.01 582.11 18.70% Transportation equipment 13.57 11.60 1.97 14.50% Office equipment and others 282.50 261.28 21.22 7.51% Total 11,003.29 4,796.15 6,207.14 56.41% (2) Basis for asset impairment testing

According to the relevant provisions of "Accounting Standards for Business Enterprises No. 8 - Asset Impairment", enterprises should determine whether there are signs that assets may be impaired on the balance sheet date. The presence of the following signs indicates that the asset may be impaired:

The market price of the asset drops significantly during the current period, and the drop is significantly higher than the expected drop due to the passage of time or normal use.
The economic, technological or legal environment in which the enterprise operates and the market in which the assets are located have undergone major changes in the current period or will occur in the near future, which will have an adverse impact on the enterprise.
Market interest rates or other market investment returns have increased in the current period, which affects the discount rate used by enterprises to calculate the present value of expected future cash flows of assets, resulting in a significant reduction in the recoverable amount of assets.
There is evidence that the asset is obsolete or physically damaged.
The assets have been or will be idle, terminated, or planned to be disposed of in advance.
Evidence from the company's internal reports shows that the 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 operating profit (or loss) realized is far lower than (or higher than) the expected amount, etc.
Other indications that the asset may have been impaired.

The company strictly follows the asset impairment standards and comprehensively checks whether there are signs of impairment of fixed assets; if there are signs of impairment, it is necessary to calculate the recoverable amount of the asset (the net amount after the fair value of the asset minus disposal costs is determined, whichever is higher, and the present value of the asset's expected future cash flows), and compare it with the book value to determine whether impairment provisions need to be made to ensure that impairment is made promptly and adequately.

(3) Provision for impairment of fixed assets

In accordance with accounting policies, Tianjin Wanxiang fixed assets have fully provided for depreciation and no provision for impairment. The specific reasons are as follows:

Houses and buildings mainly include factories, office buildings, guard rooms, dormitories, etc., located in Baodi Energy Saving and Environmental Protection Industrial Zone, Tianjin. The initial entry date was October 2016. In recent years, land prices, building materials, labor costs, engineering fees, etc. have increased significantly. Coupled with the development of industrial parks and the gradual improvement of supporting facilities, compared with the current situation, the initial construction cost of houses and buildings is lower, and the current replacement cost is significantly higher than the original book value. At the same time, the main structure of the house and building is intact, the functions are normal, there is no sign of impairment, and the recoverable amount is expected to be greater than the book value.
The machinery and equipment are general-purpose equipment. The initial recording date of the main equipment was October 2016. Depreciation has been basically completed. The machinery and equipment show no signs of impairment. The recoverable amount is expected to be greater than the book value. 3) The depreciation of transportation tools, office equipment and others has basically been completed, there is no sign of impairment, and the recoverable amount is expected to be greater than the book value.

In summary, according to the asset impairment standards and the company's management's comprehensive judgment and analysis, there are no signs of impairment of fixed assets, and there is no need to make impairment provisions for fixed assets.

Impairment of fixed assets of Ningxia Wanxiang

According to the relevant provisions of "Accounting Standards for Business Enterprises No. 8 - Asset Impairment", Ningxia Wanxiang's fixed assets showed obvious signs of impairment. The company's management promptly initiated the impairment test procedure and entrusted a professional evaluation agency, Northern Asia Affairs, to conduct an independent assessment of the recoverable amounts of Ningxia Wanxiang's scrap tire resource recycling project asset group and external leasing asset group. Among them, the scrap tire resource recycling project asset group includes fixed assets, construction in progress, intangible assets and other non-current assets, etc.; the external leasing asset group includes fixed assets, intangible assets, etc.

Regarding the asset group of the waste tire resource recycling project, Northern Asia conducted a professional assessment of the asset group and issued Northern Asia Pingbao Zi [2026] No. 01-0594 assessment report on April 20, 2026. The evaluation results showed that the book value of the asset group was 286.4061 million yuan, the recoverable amount was 223.3735 million yuan, and the assessment impairment was 63.0327 million yuan. Regarding the external leasing asset group, Northern Asia also conducted a professional evaluation of the asset group and issued Northern Asia Pingbao Zi [2026] No. 01-0593 evaluation report on April 20, 2026. The evaluation results showed that the book value of the asset group was 27.2037 million yuan, the recoverable amount was 15.890 million yuan, and the assessment impairment was 11.3137 million yuan.

The company's management believes that the evaluation procedures used by Northern Asia are compliant, the methods are appropriate, and the results are objective and consistent with the actual situation. Based on the third-party assessment results, full consideration was given to impairment factors such as idle production capacity, declining income, and asset inefficiency. In accordance with the requirements of the asset impairment standards, Ningxia Wanxiang has made sufficient and timely provision for impairment according to the impairment amount reported in the assessment, which complies with the relevant provisions of the Accounting Standards for Business Enterprises.

2. Annual audit accountant’s verification:

(1) In response to the above matters, we have implemented the following verification procedures:

Understand the key internal controls related to the impairment of fixed assets and the ability to continue operating, evaluate the design and execution of relevant internal controls, and test the effectiveness of their operation;
Carry out supervision procedures on fixed assets, check the physical condition of assets, and evaluate the rationality of management’s judgment on signs of impairment;
Obtain the impairment test draft prepared by the management or external experts hired by it, review the impairment test calculation process and key parameters, and confirm the rationality of the test method and the accuracy of the data calculation;
Evaluate the independence and professional competence of third-party external experts hired by management;
Based on our understanding of the industry and the company’s operating conditions, analyze and review the reasonableness of the major judgments and estimates used by management when conducting impairment testing;
Compare the basic data of expected future cash flows with historical data and other supporting evidence and consider their reasonableness;
Review the company’s management’s supporting documents and information on the evaluation process, response plans and measures related to Ningxia Wanxiang and Tianjin Wanxiang’s continued operations, such as business plans, cash flow forecasts, orders on hand, etc., evaluate whether the company’s response plans and measures for continued operations are reasonable and feasible, and judge whether the company’s financial statements are appropriately prepared based on the going concern assumption.
Check the adequacy and completeness of disclosures related to asset impairment and going concern in the notes to the company's financial statements.

(2) Verification opinions

After verification, based on the company's orders on hand, the business plan and improvement measures taken by the management, we believe that Tianjin Wanxiang and Ningxia Wanxiang have the ability to continue operating; in addition, the impairment provisions for related fixed assets of Tianjin Wanxiang and Ningxia Wanxiang are sufficient and timely.

Question 4. Your company disclosed the "Announcement on the Correction and Retrospective Adjustment of Previous Accounting Errors" and corrected accounting errors for the consolidated financial statement data in 2023 and 2024. Please explain the specific circumstances of accounting errors involving inter-temporal recognition of revenue, including but not limited to business content, time of occurrence, time of revenue recognition, contract amount, payment and settlement arrangements and repayment status, previous accounting treatment, reasons and basis for correction, accounting treatment after correction, specific impact on the corresponding annual financial report, and explain that your company has corrected the accounting errors in the 2023 consolidated financial statements in 2025, and then corrected it again in 2023. The reasons and rationality of the annual financial data, whether the correction of previous accounting errors is prudent and sufficient, and whether there are false records in the relevant annual financial report. Ask the annual audit accountant to verify and issue a clear opinion.

1. Company reply

(1) The specific circumstances of accounting errors involving inter-temporal recognition of revenue, the previous accounting treatment, the reasons and basis for correction, the corrected accounting treatment, and the specific impact on the corresponding annual financial report

The company conducted a comprehensive review of the revenue in 2024 and 2025. Based on the contract, acceptance data, payment status, and communication with customers, it was found that accounting errors involved inter-temporal recognition of revenue, as follows:

(Unit: 10,000 yuan)

Collection fee

amount(cutoff

Contract payment after performance is completed Original confirmation of receipt Receipt receivable serial number Customer name Business content Time of contract signing Payment agreement Revenue amount 2025 Remarks Amount Time of completion Period of entry Period of entry

December 31

day