On January 11, Capital State learned that the listing Committee of the Beijing Stock Exchange issued an announcement on the outcome of the first Review Conference in 2022.

The comments on this review are as follows:

1. Please recommend institutions to check the reasons and reasonableness of Xu Qiangsheng's transfer of de Yicheng investment partnership shares, and whether there are stock ownership or other interest arrangements. Additional disclosure of Cade Quartz is required.

two。 Please recommend institutions and reporting accountants to supplement the verification procedures on production costs and express verification opinions on the authenticity and accuracy of production costs.

3. Please recommend the sponsor to supplement the verification of the reasonableness and compliance of the actual controller and his relatives in their employment and remuneration in Cade Quartz, and express their verification opinions. Additional disclosure of Cade Quartz is required.

At the same time, the main questions raised by the Review Conference are as follows:

1. About the transfer of equity.

According to the filing, Baosheng Quartz acquired a 5% stake in Cade Quartz by transfer in October 2011 and transferred all its 5% stake to Deyicheng Investment in June 2015. In June 2015, Xu Qiangsheng, one of the shareholders of Baosheng Quartz, indirectly held a 5% stake in Kaide Quartz through de Yicheng Investment. in 2019, Xu Qiangsheng transferred his 27.774% partnership share of de Yicheng Investment to Xu Nan, Xu Tingting and Zhao Hong, sister of Zhao Ning, Yingkai Investment partner of Kaide Quartz shareholder. In March and April 2019, Baosheng quartz transferred its patents of "a method of changing mandrel without stopping furnace" and "ZL201310105331.7 of a non-mandrel continuous furnace for drawing quartz glass rod" to Cade quartz at a price of 100000 yuan.

Ask for additional instructions from Cade Quartz:

(1) the reason and rationality why Baer Quartz transferred all its 5% stake in Cade Quartz to DeYicheng Investment in June 2015, whether the equity held by Baer Quartz is really held, and whether there are stock ownership or other interest arrangements.

(2) the time, price and rationality of Xu Qiangsheng's acquisition of de Yicheng's investment partnership share, and whether the transfer of shares in Cade Quartz with the above-mentioned Baosheng Quartz is a package transaction arrangement.

(3) the reason, rationality and price payment of Xu Qiangsheng's transfer of 27.774% partnership share of de Yicheng investment in 2019, the reason and rationality of the difference between the price of transferring partnership share to Xu Nan and Xu Tingting and the price of partnership share transferred to Zhao Hong. The resumes of Zhao Ning and Zhao Hong and the sources of funds for obtaining the partnership share, and combined with the running water of the relevant banks, further explain whether Zhao Hong really holds the share of de Yicheng investment partnership, and whether there are stock ownership or other interest arrangements.

(4) the authenticity and rationality of the above patent transfer transactions between Cade Quartz and Baer Quartz, and the authenticity and price fairness of other transactions between Cade Quartz and Baer Quartz during the reporting period, and please further explain whether there is any other relationship and benefit transfer between Cade Quartz and Bausheng Quartz in combination with the changes in the share of the above equity and partnership enterprises.

Cade quartz sponsors and lawyers are required to explain in detail the verification procedures and verification methods and to express clear verification opinions on the above-mentioned issues. Please declare accountants to verify and express clear verification opinions on the above-mentioned issues (4).

two。 About corporate governance.

Ask Cade quartz to explain:

(1) the educational background and nationality of Zhang Kaixuan, the director of the company, and the reasons why he and his spouse do not hold shares in Cade Quartz.

(2) the reason why Zhang Kaixuan, who has been the general manager of Cade Quartz since 2012, could not return to China in 2015.

(3) whether Zhang Kaixuan's full participation in the operation and management of Cade Quartz in the future will affect the stability of operation and control of Caide Quartz.

3. About financial standardization.

The main results are as follows: (1) the ratio of fire processing cost to material cost fluctuates greatly during the reporting period, which requires Cade quartz to further explain whether the specific reasons for the above changes are consistent with the trend of material price changes.

(2) Cade Quartz corrects accounting errors in the 2018 financial statements in 2020, in which operating costs are adjusted across periods, with a corresponding increase of 20650511.39 yuan in retained earnings at the beginning of 2018 and 28795139.24 yuan in inventory on December 31, 2018. Reduce the operating cost of 2018 by 8144627.85 yuan After retroactive adjustment, the retained earnings at the beginning of 2018 will be reduced by 4805172.53 yuan, the R & D expenditure will be increased by 7841862.10 yuan, and the inventory will be reduced by 12647034.63 yuan on December 31, 2018.

At the same time, Cade Quartz corrects the annual tax return of enterprise income tax in the previous year, and pays the corresponding annual enterprise income tax and the corresponding tax late fee, of which the late fee is 799227.31 yuan. Ask Cade Quartz to further explain the specific reasons for the correction of accounting errors and the follow-up rectification measures, whether the internal control system of Cade Quartz is effective, and ask sponsor institutions and reporting accountants to express their verification opinions.

4. About the fundraising project.

Ask Cade quartz to explain:

(1) there are 39 research and development personnel of Cade quartz, including 28 people below senior high school, accounting for 71.8%. In terms of age structure, 36 years old and above account for 74.35%. Whether the existing R & D personnel structure of Cade Quartz can meet the future development needs of Cade Quartz.

(2) the industry of Cade quartz is highly dependent on handicrafts. The fund-raising project requires 220 production technical and support personnel, while the number of Cade quartz production and support staff has remained at about 150 in the past few years. Whether the reserve of skilled workers in Cade quartz can meet the needs of the fund-raising project.

(3) Cade Quartz is required to make a further explanation on the feasibility of the industrialization of the fund-raising project. whether to realize the industrialization of high-end quartz products has sufficient technical reserves (including but not limited to raw material supply, manpower, proprietary technology, special equipment, etc.) and customer reserves, market demand, market certification and so on. Sponsor agencies are invited to express their opinions.