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Notes To The Consolidated Financial Statements
(Expressed in Renminbi)
Annual Report 2011 /
1
1
Principal activities and organisation
(continued)
(b) Organisation
(continued)
In December 2006, the Company issued 1,291,293,000 H shares with a par value of RMB1.00
each, at a price of HK$2.20 per H share by way of an initial public offering (the “IPO”) to Hong Kong
and overseas investors. In connection with the IPO, 129,129,300 domestic state-owned shares of
RMB1.00 each owned by CTC and its subsidiaries were converted into H shares and transferred to the
National Council for Social Security Fund of the PRC (“SSF”). In December 2006, the Company also
issued 193,693,000 H shares with a par value of RMB1.00 each, at a price of HK$2.20 per H share
upon the exercise of the over-allotment option. In connection with the exercise of the over-allotment
option, 19,369,300 domestic state-owned shares of RMB1.00 each owned by CTC and its subsidiaries
were converted into H shares and transferred to SSF. In April 2008, the Company completed the
placing of 326,696,000 H shares with a par value of RMB1.00 each at a price of RMB5.25 (the
“Placing”). In connection with the Placing, 32,669,600 domestic legal person shares of RMB1.00
each owned by National Council for the Social Security Fund was converted into H shares. A total of
1,992,850,200 H shares have been listed on The Stock Exchange of Hong Kong Limited (the “Stock
Exchange”).
Pursuant to the acquisi t ion agreement dated 15 June 2007, the Company acqui red the
telecommunications infrastructure services, business process outsourcing services and applications,
content and other services located in Jiangsu Province, Anhui Province, Jiangxi Province, Hunan
Province, Guangxi Zhuang Autonomous Region, Chongqing Municipality, Sichuan Province, Guizhou
Province, Yunnan Province, Shaanxi Province, Gansu Province, Qinghai Province and Xinjiang Uygur
Autonomous Region, together with the equity interests in Guangdong Nanfang Communication
GSM Intelligent Card System Co., Ltd and Ningbo Public Information Industry Co., Ltd (the “Target
Business”) from CTC. Such acquisition was completed on 31 August 2007.
Pursuant to the Equity Transfer Agreements entered into by the Company and CTC Group on 26 May
2009, the Company acquired a 95.945% equity interest in Shanghai Tongmao Import & Export Co. Ltd
(“Tongmao”) and a 51% equity interest in Guoxin Lucent Technologies Network Technologies Co., Ltd
(“Guoxin Lucent”, now renamed as “Guoxun Innovation Software Technology Co., Ltd”) (collectively
the “Target Interests”) for a total purchase price of RMB98.05 million.
2
Significant accounting policies
(a) Statement of compliance
These financial statements of the Company and the Group have been prepared in accordance with
International Financial Reporting Standards (“IFRSs”) promulgated by the International Accounting
Standards Board (“IASB”). IFRSs include all applicable individual International Financial Reporting
Standards, International Accounting Standards (“IASs”) and related interpretations. The financial
statements also comply with the disclosure requirements of the Hong Kong Companies Ordinance
and the applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited.
A summary of the significant accounting policies adopted by the Group is set out below.