Reply to the Inquiry Letter Regarding Beijing ChenAn Technology Co., Ltd.'s Application for Issuance of Shares to Specific Targets
Tianzhi Letter [2026] No. 30916
Shenzhen Stock Exchange:
Pursuant to the "Inquiry Letter Regarding Beijing ChenAn Technology Co., Ltd.'s Application for Issuance of Shares to Specific Targets" (Inquiry Letter [2026] No. 020047) issued by your exchange on May 26, 2026 (hereinafter referred to as the "Inquiry Letter"), Tianzhi International Certified Public Accountants (Special General Partnership) (hereinafter referred to as "we" or "the accountants"), as the auditor of Beijing ChenAn Technology Co., Ltd. (hereinafter referred to as "ChenAn Technology", "the Issuer", "the Company", or "the Listed Company"), has conducted item-by-item verification of the matters requiring the accountants' opinion in the Inquiry Letter and provides the following reply:
In this reply, any discrepancies in the sum of individual items and the total amount are due to rounding.
Question 1
According to the application documents, the Issuer's main business is the research and development, design, manufacturing, sales, and related services of public safety software and public safety equipment. During the reporting period, the Company's operating revenue was RMB 225,682.47 million, RMB 140,105.94 million, RMB 146,815.08 million, and RMB 22,292.57 million, respectively. The net profit attributable to the parent company after deducting non-recurring items was RMB 7,964.17 million, RMB -32,212.72 million, RMB -22,106.49 million, and RMB -2,971.92 million, respectively. The gross profit margins were 38.35%, 26.54%, 29.61%, and 36.06%, respectively.
During the reporting period, the Company's top five customers and suppliers changed significantly, with overlapping major customers and suppliers. At the end of each reporting period, the book value of the Company's accounts receivable was RMB 213,206.00 million, RMB 188,338.11 million, RMB 174,849.29 million, and RMB 170,175.86 million, respectively. As of the latest period, the proportion of accounts receivable aged over one year for which impairment losses were accrued by the combined method was 61.93%. At the end of each reporting period, the book value of the Company's contract assets was RMB 18,477.47 million, RMB 36,279.77 million, RMB 53,232.51 million, and RMB 51,693.16 million, respectively, of which projects that were completed but not yet settled accounted for over 80% of the contract asset book value.
As of the latest period, the Company identified its equity investment in Qingkong Jinxin (Beijing) Public Safety Industry Investment Management Co., Ltd. as a financial investment.
Issuer to provide supplementary explanations:
(1) Based on changes in product sales structure and gross profit margin, changes in product prices and sales volume, industry supply and demand, period expenses, impairment provisions, and other factors affecting profit and loss, explain the reasons and reasonableness of the Company's performance fluctuations and losses in the past two years and the current period, whether it is consistent with the trend of comparable companies in the same industry, whether the relevant adverse factors have been eliminated or weakened, and the measures the Company plans to take.
(2) The reasonableness of the significant changes in the Issuer's top five customers and suppliers, the corresponding major projects, whether there is an affiliate relationship between the Issuer and its major customers and suppliers; based on the specific business situation, explain the reasons and reasonableness of the overlap of top five customers and suppliers, whether it conforms to industry practice, the main procurement and sales content, and the necessity of related transactions.
(3) The reasonableness of the changes in the balance of accounts receivable during the reporting period, combined with the age structure of accounts receivable, accounts receivable turnover ratio, actual overdue situation, collection and post-period repayment status, customer structure, and the credit status of major customers, explain whether the credit policy has been strictly implemented, the reasons and reasonableness for the high proportion of long-term accounts receivable, and whether the provision for bad debts is sufficient.