Shengxin Lithium Energy Group Co., Ltd.
Audit Report
Daxin Shen Zi [2026] No. 2-00800
Wuyige Certified Public Accountants LLP
To the Shareholders of Shengxin Lithium Energy Group Co., Ltd.:
I. Audit Opinion
We have audited the financial statements of Shengxin Lithium Energy Group Co., Ltd. (hereinafter referred to as the "Company"), which comprise the consolidated and parent company balance sheets as of December 31, 2025, the consolidated and parent company income statements, the consolidated and parent company cash flow statements, and the consolidated and parent company statements of changes in equity for the year 2025, as well as the notes to the financial statements.
In our opinion, the accompanying financial statements have been prepared in all material respects in accordance with the Accounting Standards for Business Enterprises, and fairly present the consolidated and parent company financial position of the Company as of December 31, 2025, and the consolidated and parent company operating results and cash flows for the year 2025.
II. Basis for Audit Opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants of China. Our responsibilities under these standards are further described in the "Certified Public Accountant's Responsibilities for the Audit of the Financial Statements" section of the audit report. In accordance with the Code of Ethics for Certified Public Accountants of China and the independence standards, we are independent of the Company and have fulfilled our other ethical responsibilities. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, 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.
(I) Revenue Recognition
- Matter Description
The Company is primarily engaged in the production and sales of lithium products and forestry planting and sales business. The Company's operating revenue for 2025 was 5,064,315,775.69 Yuan. Revenue from the sale of products is recognized when the customer obtains control of the products. According to the sales contract, the Company recognizes revenue at the point when the goods are delivered to the customer and the purchaser signs for receipt without objection, and the relevant revenue has been received or the right to receive payment has been obtained.
For details of the accounting policies and analysis, please refer to Note III (26), Note V (44). Since revenue is one of the Company's key performance indicators, revenue recognition has a significant impact on the Company's operating results, and therefore we identify revenue recognition as a key audit matter.
- Audit Response
Our main audit procedures for revenue recognition include:
(1) Understanding and evaluating the design of internal controls related to revenue recognition and testing the effectiveness of the operation of key internal controls.
(2) Evaluating management's integrity and fraud risk.
(3) Through interviews with management and inspection of major customer contracts, identifying whether the terms and conditions related to the transfer of control of goods are consistent with the requirements of the Accounting Standards for Business Enterprises.
(4) Performing substantive analytical procedures on operating revenue and gross margin by month, product, etc., to identify whether there are significant or abnormal fluctuations and analyzing the causes of fluctuations.
(5) Obtaining sales contracts, orders, delivery notes, logistics documents, sales invoices, customs declaration forms, sales collection vouchers, and accounting vouchers for major customers, and verifying whether the relevant documents are consistent.