1.About the Global Procurement Services business
According to the application materials:(1) In the global procurement service, the purchaser of electronic components searches for products or inquires with the company's business personnel through Huaqiang**, and the company uses the EBS system and the data resources of the first business library and SKU library to find the source of goods and complete the procurement, so as to provide procurement services with complete categories, quality assurance and reliable delivery.
2) The company generally designates business personnel to track and serve customers for a long time. At the same time, the company provides electronic component procurement services for online customers through the self-built one-stop electronic components procurement platform - Huaqiang**, as the web portal. (3) The company has accumulated tens of thousands of electronic components and has millions of registered users.
4) Considering the frequent demand for electronic components from large and medium-sized B-end customers and the high transaction amount, the company's direct sales of information data or digital systems is not the best way to make profits. The procurement service model realizes profits by earning the difference between purchase and sale in the form of transactions, and recognizes sales revenue according to the total amount method. (5) The procurement service model mainly meets the long-tail procurement needs, electronic product manufacturers in the research and development, trial production, mass production (market supply and demand mismatch), maintenance and other stages, or in the case of quality accidents, inventory shortages, etc., there are a large number of electronic components long-tail procurement needs, with difficult, small batches, unstable, diversified, scattered, high-frequency, high efficiency requirements and other characteristics.
6) According to the sponsorship work report, during the reporting period, the offline sales revenue of the issuer's global procurement business was 54,736070,000 yuan, 28,500$140,000 and $51,031190,000 yuan, accounting for the proportion of the business revenue. 37% and 9351%。Issuer please:
1) Explain whether the issuer's global procurement services are limited to the procurement of electronic components, the types of electronic components sold by the issuer in each period of the reporting period, the amount and proportion of the main models, the volatility, reasons and reasonableness of the relevant sales**, the difference between the selling price and the open market, and the matching between the sales quantity and sales amount and the purchase volume of the corresponding electronic components in each period. (2) Explain the operation mode of Huaqiang**, including the settlement management of the first merchant, the capital settlement cycle between the issuer and the first merchant, the progress management of customer orders and payment of goods, etc., whether the issuer needs to charge the first merchant or buyer for the settlement, deposit and other management fees, and the relationship between Huaqiang** and the EBS system and SKU database data resources.
3) Explain the number of active merchants, customers, dealers and customers in each period of the reporting period and the stability of the reporting period, the way in which the issuer establishes cooperation with the first business, whether it has signed a contract, whether it is an exclusive cooperation, and the measures taken by the issuer to ensure that the relevant commodities meet the quality standards and requirements when selling to downstream customers. (4) Explain the necessity for downstream customers to purchase electronic components from the issuer after buying out the issuer, whether the issuer needs to process, assemble or package the components, the reasons why "the company's direct sales of information data or digital systems is not the best way to make profits", and whether the current business model adopted by companies in the same industry is significantly different from that of the issuer.
5) Explain the scope of the issuer's main responsibilities in global procurement services, whether it has the obligation to ensure the compliance of the intellectual property rights of relevant components and corresponding measures, whether there are reports and complaints due to the quality of relevant goods and no intellectual property rights during the reporting period, and whether it has been punished by relevant departments. (6) Explain the reasons why the issuer's global procurement services can only meet the needs of long-tail procurement, the reasons why it will no longer be purchased through the issuer in the mass production stage after long-tail procurement, and explain the reasonableness of the issuer's global procurement service sales scale during the reporting period and the issuer's ability to continue operations in combination with the market size of long-tail procurement, the business scale of major customers, and the purpose of procurement.
7) Explain the definition and definition criteria of online and offline sales of global procurement business, the differences between the two in terms of business model, product structure and customer type, the reasons why the relevant products are mainly sold offline, and the differences, reasons and reasonableness of the differences between the relevant products and the comparable businesses of comparable companies in the same industry. Combined with the foregoing, it further explains the reasonableness of the issuer's selection of comparable companies, and the reasons and reasonableness of not selecting ** company as a comparable company. (8) Explain the reasonableness of the gross amount method for recognizing revenue for global procurement services in light of the business substance and the relevant provisions of the Accounting Standards for Business Enterprises, and whether there are material differences with the accounting treatment of companies in the same industry.
The sponsor is requested to express a clear opinion, the issuer's lawyer to express a clear opinion on the legal matters involved, and the reporting accountant to express a clear opinion on the accounting matters involved. [Reply].
(8) Explain the reasonableness of the gross amount method for recognizing revenue for global procurement services in light of the business substance and the relevant provisions of the Accounting Standards for Business Enterprises, and whether there are material differences with the accounting treatment of companies in the same industry. 1. Combined with the essence of the company's business and the relevant provisions of the Accounting Standards for Business Enterprises, it is reasonable for global procurement services to use the gross amount method to recognize revenue
(1) Accounting Standards for Business Enterprises and related documentsOn January 1, 2020, the issuer implemented the Accounting Standard for Business Enterprises No. 14 - Revenue (Cai Kuai 2017 No. 22, hereinafter referred to as the "New Revenue Standard"), and Article 34 of the New Revenue Standard stipulates that "an enterprise shall determine whether it is the main responsible person or the first person when engaging in the transaction according to whether it has control over the commodity before the transfer of the commodity to the customer." If an enterprise is able to control the commodity before transferring it to a customer, the enterprise is the main responsible person and shall recognize the revenue according to the total amount of consideration received or receivable. Otherwise, the enterprise is a ** person and shall recognize its income according to the amount of commissions or handling fees that it is expected to be entitled to, which shall be determined according to the net amount of the total consideration received or receivable after deducting the price payable to other relevant parties, or according to the established commission amount or proportion. Circumstances in which a business can control a commodity before transferring it to a customer include:
1) After the enterprise obtains control of the goods or other assets from a third party, it is transferred to the customer. 2) The enterprise can lead the third party to provide services to the customer on behalf of the enterprise.
3) After the enterprise obtains control of the commodity from a third party, it integrates the commodity with other commodities into a certain combination of output and transfers it to the customer by providing significant services. "In determining whether the company has control over the goods before the transfer to the customer, the enterprise should not be limited to the legal form of the contract, but should comprehensively consider all relevant facts and circumstances, including: 1) the enterprise bears the primary responsibility for the transfer of the goods to the customer.
2) The enterprise assumes the inventory risk of the commodity before or after the transfer of the commodity. 3) Enterprises have the right to decide on their own merits.
(2) Combined with the essence of the company's business, the rationality analysis of revenue recognition by the total amount method is adopted
2. According to the comparative analysis of similar businesses with companies in the same industry, there is no material difference between the accounting treatment of the company and companies in the same industry
According to the annual reports and other public information of companies in the same industry, the online commodity trading, commodity sales, chemical products and electronic components sales business carried out by companies in the same industry, Guolian Co., Ltd., Focus Technology, Business Treasure and Yunhan Xincheng can be reasonably judged to use the total amount method to recognize revenue. For the steel trading business, the steel trading business of Shanghai Ganglian, as the leading person, adopts the net method to recognize revenue; For other steel trading businesses except for the steel trading business as a leading person, Shanghai Ganglian adopts the total amount method to recognize revenue. The details are listed in the following table:
As can be seen from the above table, the accounting treatment of the issuer's global procurement services is consistent with that of similar businesses of companies in the same industry, and there is no difference.