Special Explanation on the Occupation of Funds by Controlling Shareholders and Other Related Parties for 2006
To all shareholders of Sichuan Top Software Investment Co., Ltd.:
We have been entrusted to conduct an audit of the balance sheet as of December 31, 2006, the profit and profit distribution statement for the year 2006, and the cash flow statement for the year 2006 of Sichuan Top Software Investment Co., Ltd. (hereinafter referred to as "Top Software Company"), and we have issued an audit report with a disclaimer of opinion [Tianjian Huazheng Zhongzhou Audit (2007) GF No. 020041].
In accordance with the requirements of the China Securities Regulatory Commission and the State-owned Assets Supervision and Administration Commission of the State Council regarding the regulation of fund transactions between listed companies and related parties, as well as external guarantees by listed companies, Top Software Company has prepared the summary table of the occupation of funds by controlling shareholders and other related parties (hereinafter referred to as the "Occupation of Funds Table") attached to this special explanation.
It is the responsibility of Top Software Company to prepare and disclose the Occupation of Funds Table and ensure its authenticity, legality, and completeness. Based on the financial accounting data of Top Software Company for the year 2006, we provide this special explanation regarding the occupation of funds by controlling shareholders and other related parties. The following materials and data are extracted from the financial accounting data of Top Software Company for the year 2006. Except for the relevant audit procedures performed on related party transactions during the audit of the 2006 financial statements of Top Software Company, we have not performed additional audits or other procedures.
As of December 31, 2006, the cumulative balance of funds occupied by the controlling shareholders and their related parties of Top Software Company was 365,250,307.44 yuan, of which: operational occupation was 5,795,402.01 yuan, and non-operational occupation was 359,454,905.43 yuan; the cumulative balance of non-operational funds occupied by the controlling subsidiaries and their affiliated companies was 381,260,680.29 yuan. For specific details, please refer to the attached Occupation of Funds Table.
This special explanation is solely for the purpose of disclosure to regulatory authorities regarding the occupation of funds by controlling shareholders and other related parties of Top Software Company and shall not be used for any other purpose.