Fulin Precision Co., Ltd.
Audit Report and Financial Statements
2025 Fiscal Year
Table of Contents
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Audit Report: 1-4
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Financial Statements:
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Consolidated and Parent Company Balance Sheets: 1-4
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Consolidated and Parent Company Income Statements: 5-6
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Consolidated and Parent Company Cash Flow Statements: 7-8
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Consolidated and Parent Company Statements of Changes in Equity: 9-12
- Notes to Financial Statements: 1-119
Audit Report
Ref: Xin Kuai Shi Bao Zi [2026] No. ZA12042
To the Shareholders of Fulin Precision Co., Ltd.:
I. Audit Opinion
We have audited the financial statements of Fulin Precision Co., Ltd. (hereinafter referred to as "Fulin Precision"), which comprise the consolidated and parent company balance sheets as of December 31, 2025, and the consolidated and parent company income statements, cash flow statements, and 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 Fulin Precision 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 this report. We are independent of Fulin Precision in accordance with the Code of Ethics for Certified Public Accountants of China 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, we do not provide a separate opinion on these matters.
We have summarized the key audit matters identified in our audit as follows:
| Key Audit Matter | How the Matter Was Addressed in the Audit |
|---|---|
| (1) Revenue Recognition | Our primary audit procedures included: 1. Understanding and evaluating the design and operation of internal controls related to the sales and collection cycle; 2. Selecting samples to inspect sales contracts, identifying whether the terms and conditions related to the transfer of control of goods comply with the requirements of accounting standards; 3. Selecting samples from sales records and cross-referencing them with sales orders, customer delivery notes, and customer/supplier system records; 4. Performing external confirmation procedures for accounts receivable balances; 5. For year-end inventory held by third parties but not yet recognized as revenue, performing on-site inspection procedures at the third-party warehouse; 6. Performing analytical procedures on revenue and cost, including monthly analysis of revenue, cost, and gross margin fluctuations, and comparing current period data with the prior period; 7. Performing cut-off tests on revenue, focusing on whether revenue was recognized in the correct period, and inspecting relevant supporting documents for revenue recognized after the balance sheet date, as well as inspecting post-period sales returns to assess whether revenue was recorded in the appropriate period. |
For the 2025 fiscal year, Fulin Precision recognized operating revenue of RMB 13,430,568,965.68. Revenue recognition is a key audit matter due to the significant amount and its status as a key performance indicator, which carries a potential risk of material misstatement.