Reply of Wuyige Certified Public Accountants LLP to the Inquiry Letter on the 2025 Annual Report of Xinjiang Research Institute Co., Ltd.

Reply of Wuyige Certified Public Accountants LLP to the Inquiry Letter on the 2025 Annual Report of Xinjiang Research Institute Co., Ltd.

Daxin Bei Zi [2026] No. 12-00057

To the Management Department of Shenzhen Stock Exchange ChiNext Market Companies:

We are in receipt of your "Inquiry Letter on the 2025 Annual Report of Xinjiang Research Institute Co., Ltd." (ChiNext Market Annual Report Inquiry Letter [2026] No. 113). As the audit institution for Xinjiang Research Institute Co., Ltd.'s (hereinafter referred to as Xin Yan Shares or the Company) 2025 annual report, Daxin Certified Public Accountants (Special General Partnership) (hereinafter referred to as our firm or the annual audit accountant), in the spirit of diligence, responsibility, honesty, and trustworthiness, has conducted a comprehensive review of the issues raised by your firm and hereby replies to the review process and conclusions as follows:

1. The Company achieved a total operating revenue of 63,828.10 million yuan, a year-on-year decrease of 4.01%, and a net profit attributable to the parent company of 4,313.21 million yuan, turning losses into profits. The net profit attributable to the parent company after deducting non-recurring items was -42,507.71 million yuan, and the scale of losses continued to expand. We request that your company:

(1) Combined with the industry environment, the Company's competitiveness, the operating conditions of comparable companies in the same industry, and subsequent operating arrangements, explain the reasons for the large losses in net profit attributable to the parent company after deducting non-recurring items for many years, and whether there is any significant uncertainty about its ability to continue as a going concern.

(2) Combined with the market conditions, pricing standards, business models, main customers, revenue recognition methods of the aerospace aircraft parts business, and the Company's technical advantages, core competitiveness, industry position, and comparable company situation, analyze the reasons and reasonableness for the negative gross profit margin of the business, and whether the corresponding revenue and cost recognition is accurate.

(3) Combined with the seasonality of revenue recognition, the situation and basis for revenue recognition at the end of the period, and the post-period collection situation, explain the reasons and reasonableness for the Company's operating revenue and profit in the second quarter of 2025 being significantly lower than in other quarters, and whether the timing of revenue recognition is accurate.

Please have the annual audit accountant review and provide a clear opinion.

[Annual Audit Accountant's Reply]

I. Audit Procedures

1. Understand the industry environment in which the Company operates through online searches and interviews with relevant Company personnel.
2. Review the operating conditions of comparable companies in the same industry and compare them with the Company's key financial indicators to verify whether there are any abnormalities.
3. Inquire with the Company's management about subsequent operating arrangements and other relevant matters.
4. Perform analytical procedures to analyze the reasons for the large losses in net profit attributable to the parent company after deducting non-recurring items for many years.
5. Comprehensively assess whether there is any significant uncertainty about the Company's ability to continue as a going concern.
6. Combined with the market conditions, pricing standards, business models, main customers, revenue recognition methods of the aerospace aircraft parts business, the Company's technical advantages, core competitiveness, industry position, and comparable company situation, analyze the reasons and reasonableness for the negative gross profit margin of the business and whether the corresponding revenue and cost recognition is accurate.
7. Combined with the seasonality of revenue recognition, the situation and basis for revenue recognition at the end of the period, and the post-period collection situation, analyze the reasons and reasonableness for the Company's operating revenue and profit in the second quarter of 2025 being significantly lower than in other quarters, and determine whether the timing of revenue recognition is accurate.