Audit Report
Audit Report No. [2026] ZB10285
To all shareholders of Zhuhai Yingboer Electric Co., Ltd.:
1. Audit Opinion
We have audited the financial statements of Zhuhai Yingboer Electric Co., Ltd. (hereinafter referred to as Yingboer), including the consolidated and parent company balance sheets as of December 31, 2025, the consolidated and parent company income statements, consolidated and parent company cash flow statements, consolidated and parent company statements of changes in equity, and related notes to the financial statements. In our opinion, the attached financial statements have been prepared in all material respects in accordance with the provisions of the Accounting Standards for Business Enterprises and fairly present the financial position of Yingboer as of December 31, 2025, as well as the operating results and cash flows for the year 2025.
2. Basis for Audit Opinion
We conducted our audit in accordance with the auditing standards for certified public accountants in China. The section of the audit report titled "Responsibilities of Certified Public Accountants for the Audit of Financial Statements" further elaborates on our responsibilities under these standards. In accordance with the "Independence Standards for Certified Public Accountants No. 1 - Requirements for Independence in the Audit and Review of Financial Statements" and the Code of Ethics for Certified Public Accountants in China, we are independent of Yingboer and have fulfilled our other ethical responsibilities. We adhered to the independence requirements for auditing public interest entities. We believe that the audit evidence we obtained is sufficient and appropriate to provide a basis for our audit opinion.
3. 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 for the current period. These matters were addressed in the context of our audit of the financial statements as a whole and in forming our audit opinion, and we do not provide a separate opinion on these matters. The key audit matters identified in our audit are summarized as follows:
Key Audit Matters and How They Were Addressed in the Audit
- Revenue Recognition Yingboer's accounting policy for revenue recognition is detailed in Note 3, "Significant Accounting Policies and Accounting Estimates," Note 27. The specific data can be found in Note 5, "Consolidated Financial Statement Item Notes" (39). Yingboer's revenue primarily comes from the research, production, and sales of new energy vehicle products. In 2025, Yingboer recognized revenue of RMB 3.874 billion. Given that revenue is one of Yingboer's key performance indicators, there is an inherent risk of management manipulating revenue recognition to achieve specific targets or expectations. Therefore, we identified revenue recognition as a key audit matter. Our audit procedures related to the significant risk of material misstatement regarding revenue recognition included, but were not limited to: (1) understanding and evaluating internal controls related to sales and testing their effectiveness; (2) selecting samples to examine sales contracts, identifying and analyzing contract terms and conditions related to the transfer of risks and rewards associated with goods, and evaluating whether Yingboer's revenue recognition complies with the provisions of the Accounting Standards for Business Enterprises; (3) performing analytical procedures to compare annual revenue, costs, and gross profit margins by product, and conducting comparative analyses of gross profit margins by major customers; (4) executing detailed testing procedures, examining contracts or orders, statements, delivery receipts, customs declarations, and bank statements to confirm the authenticity and accuracy of revenue recognition; (5) performing confirmation procedures for sales revenue and accounts receivable from major customers, substituting for samples that did not receive responses; (6) executing cutoff tests for revenue, examining supporting documents for sales transactions recorded before and after the balance sheet date to evaluate whether the related revenue was recorded in the appropriate accounting period.