歌尔股份:2021年年度报告（英文版）

Goertek Inc. Annual Report 2021
Goertek Inc.Annual Report 2021
March 2022
1Goertek Inc. Annual Report 2021
Section Ⅰ Important Notes Contents and Interpretations
The Board of Directors the Board of Supervisors directors supervisors
and senior management of the Company guarantee that the information
presented in this report shall be together be wholly liable for the truthfulness
accuracy and completeness of its contents and free of any false records
misleading statements or material omissions and will undertake individual and
joint legal liabilities.Jiang Bin the person in charge of the Company and Li Yongzhi the person
in charge of accounting and the accounting department (accounting supervisor)
guarantee that the financial report in this annual report is authentic accurate
and complete.All directors have attended the board meeting to review the annual report.The Company faces the risks in market operation and management.Investors are kindly reminded to pay attention to possible investment risks. For
details see "Section III Discussion and Analysis of Management of the Company
XI Outlook for the Future Development of the Company" in this report.The future plans and some forward-looking statements mentioned herein
are planned matters which shall not constitute a substantial commitment of the
Company to investors. Therefore both investors and relevant persons should
maintain their risk awareness and understand the differences among plan
2Goertek Inc. Annual Report 2021
forecast and commitment. Please pay attention to investment risks.The profit distribution proposal considered and approved by the Board of
Directors of the Company is as follows: based on the total share capital
registered on the record date of equity distribution minus the repurchased
shares in the Company's special repurchase account the Company will
distribute cash dividend of RMB 2.00 (tax inclusive) for per 10 shares to all the
shareholders as well as 0 bonus shares (tax inclusive) and there is no conversion
of capital reserves into share capital.If any discrepancy between the English version and the Chinese version of
the annual report the Chinese version shall prevail.
3Goertek Inc. Annual Report 2021
Contents
SectionⅠImportant Notes Contents and Interpretatio... 2
SectionⅡCompany Information and Key Financial Indi... 8
Section III Discussion and Analysis of Management .. 13
Section IV Corporate Governance .................... 48
Section V Environmental and social responsibilitie.. 86
Section VI Important Matters ....................... 90
Section VII. Changes in Shares and Information abo. 112
Section VIII Information of Preferred Shares ...... 121
Section IX Information on the Bonds ............... 122
Section X Financial Report ........................ 123
4Goertek Inc. Annual Report 2021
Directory of Reference Files
(1) Financial statements with signatures and seals of the legal representative the person in charge of accounting and the person in
charge of accounting department (accounting supervisor);
(2) The originals of 2021 annual report and its abstract signed by the legal representative of the Company;
(3) The originals of the audit report with the seal of Zhongxi Certified Public Accountants (special general partnership) Co. Ltd. and
the signature and seal of the certified public accountants;
(4) The originals of all company documents and announcements publicly disclosed in newspapers designated by China Securities
Regulatory Commission (CSRC) during the reporting period.
5Goertek Inc. Annual Report 2021
Interpretation
Terms Refers to Content of interpretation
Company the Company Goertek Inc. Refer to Goertek Inc.Goertek Group Refers to Goertek Group Co. Ltd. Controlling shareholder of the Company
Weifang Goertek Electronics Co. Ltd. wholly owned subsidiary of
Weifang Goertek Refers to
the Company
Weifang Goertek Microelectronics Co. Ltd. controlled subsidiary of
Weifang Goertek Microelectronics Refers to
the Company
Goertek Optical Technology Co. Ltd. wholly owned subsidiary of
Goertek Optical Refers to
the Company
Goertek Technology Vina Company Limited wholly owned
Goertek Technology (Vietnam) Refers to
subsidiary of the Company
ODM Refers to Original Design and Manufacturing
JDM Refers to Joint Design and Manufacturing
The micro electro-acoustic components that transform electrical
signal into acoustic signal generate driving force through the
magnetic line cutting of voice coil in magnetic field to drive the
Micro speaker Refers to diaphragm vibration which then pushes the air for sounding.Compared with the micro receiver it's characterized by higher
power wide frequency response and high fidelity which is generally
used for playing the sound.Based on micron/nano technology Micro electro mechanical system
(MEMS) is a technology developed for designing processing
manufacturing measuring and controlling micron/nano materials.MEMS can integrate mechanical components optical system and
MEMS Refers to
electric control system of driving components into a whole unit of
micro system featured with miniaturization intelligence
multi-function high integration and being suitable for mass
production
The acoustic component composed of one or several micro speakers
Speaker module Refers to and other electronic devices which are assembled together through
an injection molded housing.A portable device that can be worn or carried directly or integrated
Smart wearable devices Refers to
into the user's clothes or accessories
Virtual Reality/VR Refers to A computer simulation system that can create and experience virtual
6Goertek Inc. Annual Report 2021
world by using computer to generate a simulation environment into
which the users immerse.A technology that perfectly integrates virtual information with the
real world. By making extensive use of multimedia 3D modeling
real-time tracking and registration intelligent interaction sensing
Augmented Reality/AR Refers to and other technical means it applies the computer-generated text
images 3D models music video and other virtual information to the
real world after simulation. These two kinds of information
complement each other to enhance the real world.The new types of smart wireless earphones represented by TWS
(True Wireless Stereo) earphones connect the left and right
earphones with smart phones and other terminal devices through
Smart wireless earphones Refers to
Bluetooth technology to form an independent stereo system which
realizes touch control voice control body information collection and
other functions by adding various sensors.Also known as SiP (System in Package) packaging module at the
system level it integrates multiple chips and passive components
into the same package through advanced packaging such as
Micro-system module Refers to technologies 3D packaging to form a module with whole or main
functions of an electronic system so as to realize the optimal
combination of performance volume weight and other indicators. It
is a comprehensive emerging microelectronics technology.A detection device that is capable of feeling the measured
information and able to transform the perceived information into
electrical signals or other required forms of information for output
Sensor Refers to
based on certain rules in order to meet the requirements of
information transmission processing storage display recording and
control.Company Law Refers to Company Law of the People's Republic of China
Securities Law Refers to Securities Law of the People's Republic of China
Articles of Association Refers to Articles of Association of Goertek Inc.CSRC Refers to China Securities Regulatory Commission
yuan (RMB) ten thousand yuan (RMB) hundred million yuan
RMB RMB 10000 RMB 100000000 Refer to
(RMB)
Reporting period Refers to January 1 2021 to December 31 2021
Explanation on Other Matters
In this report any difference between the sum of partial sums and the sum of detailed items is due to rounding.
7Goertek Inc. Annual Report 2021
Section II Company Information and Key Financial Indicators
I. Company Information
Stock abbreviation Goertek Inc. Stock code 002241
The stock exchange where stocks
Shenzhen Stock Exchange
are listed
Name of the Company in Chinese 歌尔股份有限公司
Abbreviation of the Company in歌尔股份
Chinese
Name of the Company in English
Goertek Inc.(if any)
Abbreviation of the Company in
Goertek
English (if any)
Legal representative of the
Jiang Bin
Company
Registered address 268 Dongfang Road High-tech Industrial Development District Weifang
Postal code of registered address 261031
Previous changes of registered
No change
address of the Company
Business address 268 Dongfang Road High-tech Industrial Development District Weifang
Postal code of business address 261031
Company website http://www.goertek.com
E-mail ir@goertek.com
II. Contacts and Contact Information
Board Secretary Securities Affairs Representative
Name Jia Jun'an Xu Yanqing Xu Dapeng
268 Dongfang Road High-tech Industrial 268 Dongfang Road High-tech Industrial
Contact address
Development District Weifang Development District Weifang
Tel. 0536-3055688 0536-3055688
Fax 0536-3056777 0536-3056777
E-mail ir@goertek.com ir@goertek.com
8Goertek Inc. Annual Report 2021
III. Information Disclosure and Place of the Report
Website of the stock exchange for release of the
Shenzhen Stock Exchange (http://www.szse.cn)
Annual Report
Name and website of the media for release of the Securities Times China Securities Journal Shanghai Securities News
Annual Report Securities Daily CNINFO（http://www.cninfo.com.cn）
Place where the Annual Report is available for
Office of Board of Directors of the Company
inspection
IV. Changes in Registration
Organization code 91370700729253432M
The changes in main business since the Company
No change
was listed (if any)
Changes of controlling shareholders of the
No change
Company (if any)
V. Other Relevant Information
Accounting firm engaged by the Company
Name of the accounting firm Zhongxi Certified Public Accountants (special general partnership) Co. Ltd.Business address Room 1101 No. 11 Chongwenmenwai Street Dongcheng District Beijing
Names of accountants signing the
Du Yeqin Mou Huiling
report
The sponsor institution engaged by the Company to perform continuous supervision during the reporting period
√ Applicable □ Not applicable
Business address of the sponsor Duration of continuous
Name of the sponsor institution Name of sponsor representative
institution supervision
9th Floor Building B Kayheng
Center No.2 Chaoyangmennei From June 12 2020 to
China Securities Co. Ltd. Guan Feng Huang Zhenyue
Street Dongcheng District December 31 2021
Beijing
The financial advisor engaged by the Company to perform continuous supervision during the reporting period
□ Applicable √ Not applicable
Ⅵ. Key Accounting Data and Financial Indicators
Whether the Company performed a retrospective adjustment or restatement of previous accounting data
□ Yes √ No
2021 2020 Year-on-year change 2019
9Goertek Inc. Annual Report 2021
Operating revenue (RMB) 78221418618.02 57742742893.96 35.47% 35147806427.74
Net profit attributable to shareholders of
4274702999.382848007269.6150.09%1280542212.61
the Company (RMB)
Net profit attributable to shareholders of
the Company excluding non-recurring 3832421177.27 2758911040.03 38.91% 1348634308.27
profits and losses (RMB)
Net cash flow from operating activities
8598475527.887682256113.6811.93%5451430414.59
(RMB)
Basic earnings per share (RMB / share) 1.29 0.89 44.94% 0.40
Diluted earnings per share (RMB / share) 1.28 0.89 43.82% 0.40
Weighted average return on net assets 17.61% 16.40% 1.21% 8.19%
December 31 2021 December 31 2020 Year-on-year change December 31 2019
Total assets (RMB) 61079051133.27 49117826313.41 24.35% 34660304627.21
Net assets attributable to shareholders of
27327747993.9719653252273.2639.05%16107163639.60
the Company (RMB)
The Company's net profit before and after deducting non-recurring profits and losses in the last three fiscal years whichever is lower
is negative and the audit report of last year shows that there is uncertainty in company's ability to continue as a going concern.□ Yes √ No
The net profit before and after deducting non-recurring profits and losses whichever is lower is negative.□ Yes √ No
Ⅶ. Differences in accounting data between domestic and foreign accounting standards
1. Differences in net profits and net assets in the financial reports disclosed according to international
accounting standards and Chinese accounting standards
□ Applicable √ Not applicable
During the reporting period there is no difference in net profits and net assets in the financial reports disclosed pursuant to
international accounting standards and Chinese accounting standards
2. Differences in net profits and net assets in the financial reports disclosed according to foreign accounting
standards and Chinese accounting standards
□ Applicable √ Not applicable
During the reporting periods no differences in net profits and net assets in the financial reports disclosed according to foreign
accounting standards and Chinese accounting standards at the same time
10Goertek Inc. Annual Report 2021
Ⅷ. Key Quarterly Financial Indicators
Unit: RMB
The first quarter The second quarter The third quarter The fourth quarter
Operating revenue 14028169300.89 16259628386.33 22501367860.88 25432253069.92
Net profit attributable to
965953650.11765076109.611601494203.24942179036.42
shareholders of the Company
Net profit attributable to
shareholders of the Company
601329147.56808228696.461609128973.48813734359.77
excluding non-recurring profits and
losses (RMB)
Net cash flow from operating
873274388.663108904252.541776650281.672839646605.01
activities
Whether there is significant difference between the above individual or aggregate financial indicators and that of what disclosed in
the quarterly reports and semi-annual reports disclosed by the Company
□ Yes √ No
Ⅸ. Items and Amounts of Non-recurring Profits and Losses
√ Applicable □ Not applicable
Unit: RMB
Item 2021 2020 2019 Explanation
Profits and losses on disposal of non-current
assets (including the write-off portion of the -122148708.58 -219544001.32 -195445840.66
provision for asset impairment)
Government subsidies included in the
current profits and losses (except those
closely related to the Company's normal
business comply with national policies and 464119437.91 221372903.17 177315056.36
regulations and continuously grant in
accordance with a certain standard quota or
quantity)
In addition to the effective hedging business
related to normal business of the Company
the profits and losses from the changes in
fair value arising from holding
held-for-trading financial assets and 185179920.90 102685404.04 -81283474.24
held-for-trading financial liabilities as well
as the investment income obtained from the
disposal of held-for-trading financial assets
held-for-trading financial liabilities and
11Goertek Inc. Annual Report 2021
available-for-sale financial assets
Other non-operating revenue and
expenditures other than those mentioned 13554671.71 5874633.40 13488075.24
above
Other profit and loss items that meet the
2603363.203236394.55685750.54
definition of non-recurring profit and loss
Less: Impact of income tax 84270186.15 21159380.84 -17148337.10
Impact of minority shareholders'
16756676.883369723.42
interest (after tax)
Total 442281822.11 89096229.58 -68092095.66 --
Details of other profit and loss items that meet the definition of non-recurring profit and loss：
√ Applicable □ Not applicable
It mainly refers to returned service charge for withholding individual income tax and other fees.Description of defining the non-recurring profit and loss items which are listed in Explanatory Announcement No. 1 on Disclosure of
the Information regarding the Companies Offering Their Securities to the Public - Non-recurring Profit and Loss as recurring profit
and loss
□ Applicable √ Not applicable
The Company did not classify any item of the non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on
Disclosure of the Information regarding the Companies Offering Their Securities to the Public - Non-recurring Profit and Loss as
recurring profit and loss in the reporting period.
12Goertek Inc. Annual Report 2021
Section III Discussion and Analysis of Management of the Company
Ⅰ. The situation of the industry during the reporting period
During the reporting period the Company's main business divides into three segments including precision components business
smart audio device business and smart hardware business. The main business of the company is categorized into the industry of the
manufacturing of computer communication and other electronic equipment. The Company's main products include acoustics optics
microelectronics structural components and other precision components as well as smart hardware products such as TWS smart
earphones virtual reality (VR)/augmented reality (AR) products smart wearable devices gaming console and accessories and smart
home products. The Company serves the leading global customers in the technology and consumer electronics industry by providing
them with vertically integrated product solutions of precision components and smart hardware as well as the related design R&D
and manufacturing services.In the mobile era when the smartphones became the core hardware devices a large number of outstanding well-known
enterprises in technology and consumer electronics industry had emerged worldwide based on the integration of advanced hardware
devices software content and innovative applications and drove the whole industry and related enterprises in its industrial chain to
achieve significant growth and enterprise development through a long period of time in the past. As the growth of the smartphone
industry has slowed down in recent years the global technology and consumer electronics industry has begun the transition from the
mobile era to the post-mobile era.According to the statistics of IDC a well-known consulting agency the global smartphone shipment in 2021 reached about 1.35
billion units with approximately 5.3% YoY increase which has resumed growth in the post-epidemic era. But regarding to its overall
performance in recent years the growth of global smartphone industry has slowed down significantly. Therefore the players in the
global consumer electronics industry are actively exploring and planning on new opportunities of the future growth of the business.At the same time advanced communication technologies such as 5G along with AI intelligent interaction sensor software
algorithm are further integrated into the new generation of smart hardware products thus creating a large number of new applications
and demands. These new smart hardware products represented by VR/AR devices smart wireless earphones smart wearable devices
and smart home products have developed rapidly in recent years.According to the statistics of IDC the global shipment of virtual reality (VR) products reached about 9.36 million units in 2021
with approximately 68.6% YoY increase. The global shipment of augmented reality (AR) products reached about 330000 units with
approximately 13.8% YoY increase. The global VR industry continues its rapid development in 2021. More well-known
13Goertek Inc. Annual Report 2021
manufacturers in consumer electronics and Internet industries actively invest in VR which promotes the continuous development of
related hardware technology and software content. The global market size of AR products is still relatively small and AR hardware
technology still faces challenges in chips optical display communication power consumption size and weight. However AR
products have shown great market potential and have attracted the global attention.According to the statistics of Futuresource a famous consulting agency the global shipment of TWS smart earphones reached
about 300 million units in 2021 with approximately 37% YoY increase. With more mature intelligent voice interaction functions and
continuous improvement of user experience the penetration rate of TWS smart earphones in overall earphone market continues to
increase and is expected to keep growing in future. According to the statistics of CCS Insight another well-known consulting agency
the global shipment of smart wearable products represented by smart watches and smart bands reached about 232 million in 2021
with approximately 20.2% YoY increase. While the market size is growing steadily high-accuracy health monitoring technology is
also under developing and improvement which is expected to create new applications and market demands for smart wearable
products in the future.The rapid development of the new generation of smart hardware products has also boosted the demand for related precision
components such as high-precision optical components and modules precision acoustic components MEMS sensors and
micro-system modules haptic components and precision structural parts thus creating new directions and market space for precision
components products.With the new development stage of the industry and the rise of smart hardware products the industry also shows a clearer
competition pattern. From the perspective of brand and enterprises the global technology and consumer electronics industry shows a
centralized trend in the competition. The leading enterprises with strong competitiveness and brand awareness demonstrate clear
competitive advantages by leveraging their resource in technologies talents funds brands and industrial ecosystem and thus lead
the technology and product innovation in the industry to a certain extent.From the perspective of supply chain global technology and consumer electronics industry continued to shift the middle-end of
the supply chain to China and other developing countries. In particular with the continuous improvement of China's
political/economic environment fundamental infrastructure industrial layout management/technical talent resources and other
aspects the overall competitiveness of electronic manufacturing enterprises of China is improved significantly thus effectively
undertake the demand of global industry and obtain new development opportunities.II. The Company’s main business during the reporting period
The Company is committed to serve the leading customers in the global technology and consumer electronics industry by
providing vertically integrated product solutions of precision components and smart hardware as well as related design R&D and
14Goertek Inc. Annual Report 2021
manufacturing services.The Company's main business divides into three segments including precision components business smart audio device
business and smart hardware business. The precision components business focuses on acoustics optics microelectronics structural
components and other precision components. The related products include micro speaker/receiver speaker module haptic
component (actuator) wireless charging device antenna MEMS microphone MEMS sensors micro-system module VR optical
component and module AR optical component AR light engine precision structural parts and etc. The above-mentioned products
are widely applied in devices such as smartphones tablets smart wireless earphones VR AR smart wearable and smart home
devices. Smart audio device business focuses on providing products related to audio voice interaction artificial intelligence and
other technologies. The main products include smart wireless earphones (TWS) wired/wireless earphones smart speakers etc. Smart
hardware business focuses on providing products related to entertainment health and home security. The main products include VR
AR smart wearable products gaming consoles and accessories smart home products etc.The Company has innovative competitive advantages in the fields of acoustics optics MEMS microelectronics and precision
manufacturing and owns many intellectual property rights in the field of precision parts and components. In addition the Company
has accumulated rich experience in projects by cooperating with industry-leading customers in the field of smart audio device and
smart hardware through "ODM" "JDM" and other business modes. During the reporting period the Company maintained a good
long-term cooperative relationship with leading customers in the global technology and consumer electronics industry kept growing
in the number of patent applications and in technological capabilities. As a result the company has been constantly recognized by
global customers for its product solutions and service capability and remains being an industry-leading manufacturer in the fields of
micro speakers MEMS microphones MEMS sensors TWS VR products smart wearable products gaming console and accessories
etc.During the reporting period due to the continuous growth of demand of smart hardware products such as VR TWS smart
wearable products gaming consoles and accessories and the related precision components the Company has achieved significant
growth in revenue and net profit. At the same time the Company further improved its position in the industry. During the reporting
period the Company won many honors including being ranked the 3rd company in the Top-100 China electronic component
enterprises based on comprehensive economic indexes the 86th company in the Top-500 private enterprises in China's
manufacturing industry the 164th company in the Top-500 private enterprises in China as well as being the executive member
company of CITIF.Ⅲ. Analysis of Core Competitiveness
1. Industry-leading precision and intelligent manufacturing capabilities
15Goertek Inc. Annual Report 2021
In technology and consumer electronics related fields the Company has been widely recognized for precision manufacturing
capabilities and obtains great reputation. Relying on the core capabilities and long-term experience in the field of precision
manufacturing the Company has continuously improved the processing accuracy efficiency and quality of precision components and
smart hardware products. The Company has in-house development capabilities of various core raw materials and The Company
adopted multiple advanced processes and technologies such as ultra-high-precision mold high-precision metal/non-metal processing
ultrasonic technology and laser technology to build industry-leading precision manufacturing capabilities in the production of
precision optical components MEMS microphones MEMS sensors micro-system modules and precision structural parts thus
ensuring the delivery of the products with high precision high efficiency and high quality.At the same time the Company actively explores the development of intelligent manufacturing mode based on the capacities of
advanced equipment development and flexible automation production. In the fields of automation machine vision and AI related to
intelligent manufacturing the Company has built a future-oriented core capability of intelligent manufacturing by continuing
investing in independent R&D introducing global advanced technologies core equipment and best practice experience for system
integration thus improving the manufacturing in all aspects through the application of information automation artificial intelligence
and other technologies. The Company promotes the transformation of its manufacturing to a more digitalized connected intelligent
and service-oriented model and to build the core capabilities of future-oriented intelligent manufacturing.
2. Multi-technologies integration platform and strong team of R&D personnel
The Company has established a product R&D and manufacturing platform integrating materials structures electronic circuits
software algorithms wireless communication advanced technology testing automation and other technologies. Through
cross-domain technology integration the Company provides customers with advanced and systematic solutions for precision
components and smart hardware products. The Company attaches great importance to the integration and cultivation of outstanding
talents in the fields of acoustics optics microelectronics wireless communication precision manufacturing automation and other
sectors around the world. The Company has set up a team of technical personnel with profound technical strength and rich
experience in product projects and has made a long-term cooperation with many well-known universities and scientific research
institutions such as Beijing University of Aeronautics and Astronautics Tsinghua University Shanghai Jiao Tong University Harbin
Institute of Technology Nanjing University Southeast University Changchun Institute of Optics Fine Mechanics and Physics
(CIOMP) Shandong University China Ocean University(OUC) Changchun University of Science and Technology and Dalian
University of Technology which forms an open and comprehensive technology R&D platform in support of continuous innovation
and R&D of technologies and products.During the reporting period the Company applied for 3468 patents including 2539 invention patents. A total of 2675 patents
has been granted including 1036 invention patents. Till December 31 2021 the Company has totally applied for 25818 patents
16Goertek Inc. Annual Report 2021
(including 3322 foreign patent applications) including 13102 invention patents; Total of 15525 patents have been granted
including 4165 invention patents.
3. Continuous strategic innovation and transformation and stable high-value customer relationships
Facing the complex macroeconomic situation of domestic and overseas and the slowdown in the growth of the smartphone
industry the management of the Company actively carries out strategical innovation and transformation. While continuing to
consolidate the core competitive advantages in the conventional precision component business the Company firmly grasps the
innovation opportunities of smart hardware products in technology and consumer electronics industry. Relying on the high-value
customer resources and good customer relationships worldwide the Company focuses on the market and technology and continues to
explore new business growth opportunities in the fields of TWS VR / AR gaming and accessories smart wearable devices etc. The
Company optimizes the allocation of strategical resource supports strategical product development continues strengthening and
further utilize the customer resource advantages by closely following the world-class customers in an effort to transform the needs of
high-value customers into an inexhaustible driving force for the Company's sustainable development.
4. Excellent core management team
Although the Company experiences a rapid and sound development the core management team keeps a steady and efficient
style as always. Facing the challenges and demands of smart hardware products in the post mobile era such as rapid development
high quality high precision manufacturing short delivery cycle and complex customer certification process the core management
team promptly response to the market and makes changes and innovations continuously to keep and enhance the Company's
capabilities of strategic management operation R&D precision and intelligent manufacturing. The Company attaches importance to
and promotes the internationalization specialization and rejuvenation of its core management team and actively brings in senior
management talents and professionals from many international leading enterprises. At the same time the Company has strengthened
the echelon of its talent team more and more young talents grow up into the Company's core management team through training and
practice. The Company boasts a management team with both experience and vitality that continues to promote the Company's stable
and fast development in the future.IV. Analysis of Main Business
1. Overview
In 2021 the national economy was recovering after the outbreak of the epidemic new changes presented in both domestic and
overseas and more challenges appeared in the process to maintain the stability of the economy. Under that situation China
government maintained the continuity and pertinence of macro policies provided necessary support for economic recovery and
17Goertek Inc. Annual Report 2021
adopted a series of effective measures such as optimizing enterprise supporting policies improving business environment
strengthening technology innovation and stabilizing the industry and supply chain which finally supported China's economy to
achieve a relatively high growth rate among its fellow countries.Facing the complex global political and economic environment the repeated COVID-19 outbreaks in some countries and
regions as well as the challenges in global supply chain operation the management and all staff of the Company made their best
efforts to respond and successfully completed business development project delivery epidemic prevention and control operation
improvement and other important work. Finally the Company has achieved excellent business results with a remarkable growth in
both revenues and profits in 2021.In recent years the growth of the global smartphone market has slowed down. However COVID-19 has impacted people's lives
and work style bringing in significant increase of demand for smart hardware devices in the applications such as online
telecommuting social entertainment sports and health. As a result the emerging market of smart hardware products represented by
VR TWS smart wearable gaming consoles and accessories maintained a stable and rapid growth. Due to the Company's strategical
investment in smart hardware business in recent years the growth of the new smart hardware product market has accelerated the
sound development of the Company's business in both precision components smart audio devices and smart hardware sectors.During the reporting period the Company continued to uphold the product strategy of "precision components + smart hardware"
by actively promoting the business of precision components such as acoustics optics microelectronics and structural parts as well
as smart hardware products such as VR/AR smart wireless earphones (TWS) smart wearable and smart home devices. Especially
the businesses in VR TWS gaming consoles and accessories has experienced a rapid growth. By continuing to focus on leading
customers in the technology and consumer electronics industry and to improve customer service and relationships the Company’s
business development have also achieved fruitful results. The promotion of the internal reform of the Company has realized more
efficient decision-making process and the continuous improvement of the internal management and operation lays a good
foundation for the further development of the Company in the future.During the reporting period the Company achieved a revenue of RMB 78221.4186 million with a 35.47% YoY increase. The
Company realized a net profit attributable to shareholders of listed companies of RMB 4274.703 million with a 50.09% YoY
increase. The operating cost of the Company was RMB 67167.6667 million with a 38.54% YoY increase.During the reporting period the total amount of the Company's sales expenses administrative expenses R&D expenses and
financial expenses was RMB 6733.702 million with an 11.81% YoY increase.During the reporting period the Company further strengthened the development of new technologies products and techniques
actively brought in high-level R&D talents and invested RMB 4301.3428 million in R&D accounting for 5.50% of the revenue and
15.40% of the latest audited net assets of the Company.
18Goertek Inc. Annual Report 2021
During the reporting period the net cash flow from operating activities of the Company was RMB 8598.4755 million with an
11.93% YoY increase. The main reasons are as follows: during the reporting period the Company expanded the business scale
improved the operating cycle and thus the net cash flow from operating activities increased.
2. Revenue and cost
1) Composition of operating revenue
Unit: RMB
20212020
Proportion in Proportion in Year-on-year change
Amount Amount
operating revenue operating revenue
Total of operating
78221418618.02100%57742742893.96100%35.47%
revenue
Classified by industry
Electronic
76946324805.7398.37%56531616437.8497.90%36.11%
components
Other business
1275093812.291.63%1211126456.122.10%5.28%
income
Classified by product
Precision
13840133491.3317.69%12205410031.9421.13%13.39%
components
Smart audio device 30297084891.23 38.73% 26674264183.42 46.20% 13.58%
Smart hardware 32809106423.17 41.94% 17651942222.48 30.57% 85.87%
Other business
1275093812.291.63%1211126456.122.10%5.28%
income
Classified by region
Domestic 7571525782.78 9.68% 6999168774.17 12.12% 8.18%
Overseas 70649892835.24 90.32% 50743574119.79 87.88% 39.23%
Classified by sales mode
Direct selling 77770329729.13 99.42% 57438222579.69 99.47% 35.40%
Distribution 451088888.89 0.58% 304520314.27 0.53% 48.13%
(2) Industries products regions and sales modes accounting for more than 10% of the Company's
operating revenue or operating profit
√ Applicable □ Not applicable
Unit: RMB
19Goertek Inc. Annual Report 2021
YoY change (%) YoY change (%)
Gross profit YoY change (%)
Operating revenue Operating cost of operating of gross profit
margin of operating cost
revenue margin
Classified by industry
Electronic
76946324805.7366054072404.3514.16%36.11%39.24%-1.92%
components
Classified by product
Precision
13840133491.3310641616932.9123.11%13.39%14.57%-0.79%
components
Smart audio
30297084891.2327167160928.2410.33%13.58%19.64%-4.54%
device
Smart hardware 32809106423.17 28245294543.20 13.91% 85.87% 82.89% 1.40%
Classified by region
Domestic 6878087190.33 5921035748.23 13.91% 7.59% 8.97% -1.10%
Overseas 70068237615.40 60133036656.12 14.18% 39.75% 43.15% -2.04%
Classified by sales mode
Direct selling 76499084617.78 6 5666703312.23 14.16% 36.05% 39.18% -1.93%
Distribution 447240187.95 387369092.12 13.39% 47.68% 50.64% -1.70%
If the statistical caliber of the Company's main business data has been adjusted in the reporting period adjusted statistics of main
business are based on the caliber at the end of the reporting period of last year.□ Applicable √ Not applicable
(3) Whether the Company's revenue from physical products sales is greater than the revenue from
providing services
√ Yes □ No
Classification of
Item Unit 2021 2020 Year-on-year change
industry
Sales volume Ten thousand PCS 540341.87 413499.31 30.68%
Electronic
Output volume Ten thousand PCS 546976.95 416352.11 31.37%
components industry
Inventory volume Ten thousand PCS 34036.09 27401.01 24.21%
Reasons for changes in the relevant data over 30% year-on-year
√ Applicable □ Not applicable
During the reporting period both of the production volume and sales volume of the Company increased.
(4) Fulfillment of major sales contracts and major procurement contracts signed by the Company as of the
reporting period
□ Applicable √ Not applicable
20Goertek Inc. Annual Report 2021
5) Composition of operating cost
Classification of industry
Unit: RMB
20212020
Classification Year-on-year
Item Proportion in Proportion in
of industry Amount Amount change
operating cost operating cost
Direct 55843214176.77 84.54% 39047644492.84 82.31% 43.01%
materials
Electronic Direct labor 4058480923.72 6.14% 3401428878.80 7.17% 19.32%
components expenses
Manufacturi 6152377303.86 9.31% 4990659944.90 10.52% 23.28%
ng expenses
Explanation
During the reporting period the Company's overall sales volume increased. At the same time the sales revenue of Smart audio
devices and intelligent hardware products with relatively high material cost increased.
(6) Whether there is any change in consolidation scope during the reporting period
√ Yes □ No
During the reporting period the Company established a subsidiary company GOERTEK MICROELECTRONICS KOREA
CO.LTD.
(7) Significant changes or adjustments in the Company's business products or services during the
reporting period
□ Applicable √ Not applicable
(8) Major customers and suppliers
Major customers of the Company
Sales revenue from top five customer 67695045138.61
Proportion of total sales revenue from top five customers in
86.54%
total annual sales amount
Proportion of sales revenue from related parties among top
0.00%
five customers in total annual sales amount
Information of top five customers
No. Name of customer Sales amount (RMB) Proportion in total annual sales amount
1 Customer 1 33238529094.59 42.49%
21Goertek Inc. Annual Report 2021
2 Customer 2 18457651840.69 23.60%
3 Customer 3 8715498516.63 11.14%
4 Customer 4 3918367657.28 5.01%
5 Customer 5 3364998029.42 4.30%
Total -- 67695045138.61 86.54%
Other information of major customers
√ Applicable □ Not applicable
The top five customers do not have associated relationship with the Company and the Company's directors supervisors senior
management core technicians shareholders holding more than 5% of total shares actual controllers and other related parties do not
directly or indirectly own rights and interests in the main customers.Major suppliers of the Company
Total purchase amount from top five suppliers (RMB) 19062697560.63
Proportion of total purchase amount from top five suppliers in
30.54%
total annual purchase amount
Proportion of purchase amount from related parties among top
0.00%
five suppliers in total annual purchase amount
Information of top five suppliers
Proportion of total annual purchase
No. Name of supplier Purchase amount (RMB)
amount
1 Supplier 1 7471595122.65 11.97%
2 Supplier 2 5464068547.98 8.75%
3 Supplier 3 2732526729.39 4.38%
4 Supplier 4 1834123435.48 2.94%
5 Supplier 5 1560383725.13 2.50%
Total -- 19062697560.63 30.54%
Other information of major suppliers
√ Applicable □ Not applicable
The top five suppliers do not have associated relationship with the Company and the Company's directors supervisors senior
management core technicians shareholders holding more than 5% of total shares actual controllers and other related parties do not
directly or indirectly own rights and interests in the main suppliers.
3. Expenses
Unit: RMB
Year-on-year
2021 2020 Note of significant change
change
22Goertek Inc. Annual Report 2021
Selling expenses 444869977.08 476066518.64 -6.55% No significant change
Administrative
1951657773.32 1629730793.00 19.75% No significant change
expenses
The main reasons are as follows: Reduced loss on
exchange during the reporting period; convertible
Financial
167099982.36 490688772.09 -65.95% bonds were converted into common stocks of the
expenses
Company interest expense reduced; interest
income from money funds increased
R&D expenses 4170074282.10 3425971011.65 21.72% No significant change
4. R&D Investment
√ Applicable □ Not applicable
Names of major Status of Expected benefits to future
Purpose of project Objectives
R&D projects project development of the Company
According to specific technical
Develop a new generation requirements of the customers the
of micro speaker module Company has completed the research The project helps consolidate the
R&D project of products with high and development of a number of Company's competitive
micro speaker sensitivity low distortion In progress advanced micro speaker module advantage and market share in the
module large amplitude products and realized the mass field of acoustic precision
waterproof and dustproof production in smart phones tablet components.features. computers smart wearable and other
products for main customers.Develop new generation
The project facilitates the
of MEMS sensors and Complete the R&D verification and
business expansion the Company
R&D project of micro-system module mass production of MEMS sensors
in the field of MEMS sensors and
MEMS sensor products that are applied and micro-system module products
In progress micro-system modules and
and micro to smart wireless for terminal products such as TWS
further enhances the Company's
system module earphones smart wearable smart wireless earphones smart
comprehensive strength in the
devices and other wearable devices.field of MEMS.products.Develop the precision The project helps enhance the
optical components and Company's competitive
Complete the R&D and mass
R&D project of module products by using advantage and market share in the
production of optical lens and module
VR/AR emerging optical field of VR/AR precision optical
products for new generation of
precision technologies such as components and modules
In progress all-in-one VR products and improve
optical “Pancake” promote the Company's ability to
the ability of comprehensive solution
components and folded-lightpath lenses provide customers with
of optical devices and light-engine
modules and waveguide customized VR / AR optical
modules for AR products.technology and promote solutions and improve the
their application in Company's vertical integration
23Goertek Inc. Annual Report 2021
Names of major Status of Expected benefits to future
Purpose of project Objectives
R&D projects project development of the Company
VR/AR products. ability and profitability in the
field of VR/AR.Develop lightweight
Cooperate with customers to complete
all-in-one VR HMD The project helps consolidate the
R&D project of R&D validation mass production
products featured with Company's competitive
all-in-one VR In progress and delivery of a variety of
high-definition display advantage and market share in the
HMD new-generation all-in-one VR HMD
precise motion tracking field of VR.products.and other features.Cooperate with customers to complete It helps consolidate the
R&D project of
Develop a new generation R&D validation mass production Company's competitive
TWS smart
of TWS smart wireless In progress and delivery of a variety of advantage and market share in the
wireless
earphones new-generation of TWS smart field of TWS smart wireless
earphones
wireless earphones earphones.It helps consolidate the
Develop a new generation
R&D project of Company's competitive
of smart wearable devices
smart wearable Cooperate with customers to complete advantage and market share in
with functions of
devices for R&D validation mass production smart wearable devices such as
independent In progress
sport and health and delivery of a new generation of smart watches and smart bands
communication health
related smart watches and smart bands. and supports the Company's
mornitoring features and
applications smart wearable business for
etc.further growth.Complete the R&D and trial
production of a variety of AR glasses
products that with the functions of
It helps enhance the Company's
Develop wireless data processing and wireless
R&D project of R&D experience and technology
lightweight AR glasses communication apply advanced
smart wireless accumulation in the field of AR
and their main functional In progress precision optics and micro-display
lightweight AR and facilitates the business
modules for future AR technologies such as optical
glasses expansion of the Company in AR
applications. waveguide and silicon-based LED so
field.as to develop the solution capability
for AR glasses and their main
functional modules.R&D personnel of the Company
2021 2020 Year-on-year change
Number of R&D personnel 12895 12177 5.90%
Proportion of R&D personnel 13.46% 13.94% -0.48%
Academic structure of R&D
——————
personnel
Undergraduate 9148 8409 8.79%
24Goertek Inc. Annual Report 2021
Postgraduate 2414 1982 21.80%
PhD 63 58 8.62%
Age of R&D personnel —— —— ——
Below the age of 30 5105 4821 5.89%
Aged between 30 to 40 7162 6838 4.74%
Over the age of 40 628 518 21.24%
The Company’s investment in R&D
2021 2020 Year-on-year change
Amount of R&D Investment (RMB) 4301342763.66 3532801720.56 21.75%
Proportion of R&D investment in
5.50%6.12%-0.62%
operating revenue
Capitalized amount of R&D
662993650.30541498060.6522.44%
investment (RMB)
Proportion of capitalized R&D
15.41%15.33%0.08%
investment in R&D investment
Reasons and impacts of significant changes in R&D personnel composition of the Company
□ Applicable √ Not applicable
Reasons for significant changes in the proportion of total R & D investment in operating revenue compared with that of previous year
□ Applicable √ Not applicable
Reasons and explanation of its reasonableness of significant changes in capitalized R & D investment
□ Applicable √ Not applicable
5. Cash flow
Unit: RMB
Item 2021 2020 Year-on-year change
Sub-total of cash inflow from
85523439745.1560932031432.7340.36%
operating activities
Sub-total of cash outflow from
76924964217.2753249775319.0544.46%
operating activities
Net cash flow from operating
8598475527.887682256113.6811.93%
activities
Sub-total of cash inflow from
3276323800.48505861986.28547.67%
investment activities
Sub-total of cash outflow from
10044700261.355806999821.9572.98%
investment activities
Net cash flow from investing
-6768376460.87-5301137835.6727.68%
activities
25Goertek Inc. Annual Report 2021
Sub-total of cash inflow from
14003754499.9715780475210.72-11.26%
financing activities
Sub-total of cash outflow from
13616577139.6914138013422.54-3.69%
financing activities
Net cash flow from financing
387177360.281642461788.18-76.43%
activities
Net increase in cash and cash
2224708917.503818588192.22-41.74%
equivalents
Main influencing factors of significant year-on-year changes in relevant data
√ Applicable □ Not applicable
(1) The sub-total of cash inflow from operating activities was RMB 85523.4397 million with year-on-year increase of 40.36%
mainly due to the expansion of the Company's sales and the increase of sales receipts and advances received during the reporting
period.
(2) The sub-total of cash outflow from operating activities was RMB 76924.9642 million with year-on-year increase of 44.46%
mainly due to the increase of the Company's purchase of raw materials and payment of employee salaries during the reporting period.
(3) The sub-total of cash inflow from investment activities was RMB 3276.3238 million with year-on-year increase of
547.67% mainly due to the fact that the structural deposits purchased by the Company were collected at maturity during the
reporting period.
(4) The sub-total of cash outflow from investment activities was RMB 10044.7003 million with year-on-year increase of
72.98% mainly due to the increase of the Company's purchase of fixed assets and other long-term assets and purchase of structured
deposits during the reporting period.
(5) The net cash flow from financing activities was 387.1774 million with a year-on-year decrease of 76.43% mainly due to
RMB 3995 million in cash received by the Company from issuing bonds during the previous reporting period.The reason for significant difference between the net cash flow from the Company's operating activities during the reporting period
and net profit in current year.√ Applicable □ Not applicable
The net cash flow from operating activities exceeded the net profit of current year by 99.64% mainly due to the improvement of
the Company's refined operation capacity optimization of operation cycle and reduction of capital occupation.V. Analysis of Non-main Business
√ Applicable □ Not applicable
Unit: RMB
Amount Proportion in total Explanation of the cause Whether it is
26Goertek Inc. Annual Report 2021
profit sustainable
It is mainly due to the investment income
obtained from transaction of foreign
Investment income 469239884.79 10.19% No
exchange and equity disposal of the
Company
It is mainly due to the change in valuation
Gains from changes
-48848625.93 -1.06% of the Company's stock foreign exchange No
in fair value
derivatives
It is mainly due to the provision for
Asset impairment -241075506.45 -5.23% No
inventory depreciation
It is mainly due to the unpayable
Non-operating
22444738.18 0.49% payments and liquidated damages No
revenue
received
Non-operating It is mainly due to the losses on scrapping
99858949.06 2.17% No
expenditure of non-current assets of the Company
VI. Analysis of Assets and Liabilities
1. Major changes in asset composition
Unit: RMB
December 31 2021 January 1 2021
YoY
Proportion Proportio
change Note of significant change
Amount in total Amount n in total
(%)
assets assets
Cash and bank
10048521696.09 16.45% 7788139761.68 15.72% 0.73% No significant change
balances
Accounts
11899214525.92 19.48% 9951611596.65 20.09% -0.61% No significant change
receivable
During the reporting period inventory
Inventories 12082308485.38 19.78% 9170731903.19 18.52% 1.26% reserves increased along with business
growth of the Company
Long-term
equity 437402203.91 0.72% 337410802.56 0.68% 0.04% No significant change
investments
During the reporting period the
Company raised funds to invest in
projects increased the purchase of
Fixed assets 18123352480.76 29.67% 14674535924.15 29.63% 0.04%
production equipment and transferred
of part of the infrastructure projects
reached usable state to fixed assets
27Goertek Inc. Annual Report 2021
Construction in
2127055853.77 3.48% 2078910639.92 4.20% -0.72% No significant change
progress
Right-of-use
330796520.66 0.54% 462821988.61 0.93% -0.39% No significant change
assets
During the reporting period the
Short-term demand for daily operating funds
4284859347.027.02%3189865281.206.44%0.58%
borrowings increased and short-term borrowings
increased
During the reporting period the goods
Contract
2210825761.69 3.62% 772033187.85 1.56% 2.06% were prepared for customers and
liabilities
advance from customers increased
Long-term
2204215784.74 3.61% 2754299262.02 5.56% -1.95% No significant change
borrowings
From January 1 2021 the Company
Lease liabilities 210209955.40 0.34% 298830498.84 0.60% -0.26% implemented the new lease rules and
payed the rent as agreed
Foreign assets account for a relatively high proportion
□ Applicable √ Not applicable
2. Assets and liabilities measured at fair value
√ Applicable □ Not applicable
Unit: RMB
Impair
Profit and loss Cumulative ment Othe
Purchase amount Sales amount in
Opening from changes in changes in fair accrue r
Item in the reporting the reporting Closing balance
balance fair value in the value included d in chan
period period
report period in equity current ges
period
Financial
assets
1.
Held-for-tra
ding
financial
assets 125327442.62 64914061.44 2745091734.73 2635098910.00 300234328.79
(excluding
derivative
financial
assets)
2.125462174.67-104999182.3120462992.36
28Goertek Inc. Annual Report 2021
Derivative
financial
assets
3. Other
debt
investments
4.
Investment
in other 357307056.65 53916285.45 129080638.64 64601040.12 465677764.54
equity
instruments
Sub-total of
financial 608096673.94 -40085120.87 53916285.45 2874172373.37 2699699950.12 786375085.69
assets
Total of
above 608096673.94 -40085120.87 53916285.45 2874172373.37 2699699950.12 786375085.69
amounts
Financial
43578775.71-8763505.066427059.2843578775.7115190564.34
liabilities
Other changes
None
Whether the measurement attributes of major assets of the Company have changed significantly during the reporting period
□ Yes √ No
3. Restrictions on asset rights as of the end of reporting period
Items Book value at year end (RMB) Reasons for restrictions
Cash and bank balances 910620794.05 Deposit for bills and borrowings
Notes receivable 6095782.39 Bill pledge and others
Other non-current assets 122540194.44 When large-denomination certificates of deposit was
pledged to the bank the bank issued a financing guarantee
Accounts receivable 5000000.00 Re-insurance accounts receivable not derecognized
Total 1044256770.88
Ⅶ. Analysis of Investment
1. Overall situation
√ Applicable □ Not applicable
Investment amount in 2021 (RMB) Investment amount in 2020 (RMB) YoY change (%)
29Goertek Inc. Annual Report 2021
533092515.56207730344.46156.63%
2. Major equity investments acquired during the reporting period
□ Applicable √ Not applicable
30Goertek Inc. Annual Report 2021
3. Major non-equity investments in progress during the reporting period
√ Applicable □ Not applicable
Unit: RMB
Reasons
Accumulated for failure
Whether it Accumulated
Amount actual to reach the
is the income by
Name of Investment Project invested during investment by Source of Project Estimated planned Disclosure
investment the end of Disclosure index (if any)
project mode industry the reporting the end of the funds progress income progress date (if any)
in fixed the reporting
period reporting and
assets period
period expected
benefits
For details see
Announcement of Goertek
Inc. on Signing of
Investment Cooperation
Agreement between the
Project of Wholly-owned Subsidiary of
Dongguan the Company and the
Songshan Management Committee of
Electronic Self-raised Not Not Not January 3
Lake Self-built Yes 119630009.50 310725561.33 13.93% Dongguan Songshan Lake
components funds applicable applicable applicable 2019
Goertek High-tech Industrial
Industrial Development Zone
Park published in the information
disclosure media such as
CNINFO
(http://www.cninfo.com.cn)
Securities Times China
Securities Journal
31Goertek Inc. Annual Report 2021
Shanghai Securities News
Securities Daily.Total -- -- -- 119630009.50 310725561.33 -- -- -- -- --
4. Financial asset investment
(1) Securities investment
√ Applicable □ Not applicable
Unit: RMB
Profit and
Cumulative Purchase
loss from Sales amount Profit and Book value at
Accounting changes in amount
Type of Security Short Initial Book value at changes in in the loss in the the end of the Accounting Source of
measurement fair value in the
security code name investment cost the beginning fair value in reporting reporting reporting items funds
model included in reporting
the report period period period
equity period
period
Domestic
and Fair value Held-for-trading Self-raised
KOPN KOPN 169951481.05 120327442.62 63575754.04 85098910.00 69142817.18 98804286.66
foreign measurements financial assets funds
stocks
Total 169951481.05 -- 120327442.62 63575754.04 85098910.00 69142817.18 98804286.66 -- --
Date of announcement disclosure
by the Board of Directors for February 11 2017
approval of securities investment
Date of announcement disclosure
by shareholders meeting for March 2 2017
approval of securities investment
32Goertek Inc. Annual Report 2021
(2) Derivatives investment
√ Applicable □ Not applicable
Unit: RMB 10000
Proportion
of
Actual
investment
Amount of profit and
Name of Initial Amount of Amount of amount in
Whether it is Type of purchase loss
derivative Associated amount of Opening sales during provision for Closing the
related party derivatives Start date End date during the amount
investment relationship derivative balance the reporting impairment balance Company's
transaction investment reporting in the
operator investment period (if any) net asset at
period reporting
the end of
period
the reporting
period
Non 243551.74 453225.87 121138.30 4.34%
Bank associated No Option 330812.43 330812.43 4083.00
relationship
Non 1288528.97 1285014.09 518981.98 18.58%
Bank associated No Forward 515467.10 515467.10 25495.32
relationship
Non 191271.00 227381.46 178519.60 6.39%
Bank associated No Swap 214630.06 214630.06 4766.87
relationship
Total 1060909.59 -- -- 1060909.59 1723351.71 1965621.42 818639.88 29.31% 34345.19
Source of funds for derivatives investment Self-raised funds
Litigation involved (if any) None
Date of announcement disclosure by the Board of
March 27 2021
Directors for approval of the investment in derivatives
33Goertek Inc. Annual Report 2021
Date of announcement disclosure by shareholders
May 8 2021
meeting for approval of the investment in derivatives
1. The financial derivatives transactions carried out by the Company are for the purpose of fixing costs avoiding and preventing risks of
foreign exchange rate and interest rate and prohibiting any risk speculation. The trading quota of the Company's financial derivatives
shall not exceed the authorized quota as reviewed and approved by the Board of Directors or the general meeting of shareholders. 2. The
Company has formulated a strict management system for financial derivatives transactions which clearly stipulates the operating
Risk analysis and control measures for derivatives principles approval authority responsible departments and persons internal operating procedures information isolation measures
positions during the reporting period (including but not internal risk reporting system and risk handling procedures and information disclosure of financial derivatives transactions in order to
limited to market risk liquidity risk credit risk control trading risks arising therefrom. 3. The Company shall carefully review the terms of contracts signed with qualified banks and
operational risk legal risk etc.) other financial institutions and strictly implement the risk management system to prevent legal risks. 4. The Company's business
personnel will continue to track the changes in the open market price or fair value of financial derivatives timely assess the changes in
risk exposure of financial derivatives transactions and regularly report to the management of the Company. If any abnormal situation
inform the Board of Directors of the risk and take emergency measures accordingly. 5. The internal audit department regularly conducts
internal audit on the compliance of financial derivatives transactions.In case of changes in market price or fair value of
invested derivatives during the reporting period the
Changes in the fair value of foreign exchange derivatives are calculated based on the difference between the fair market price and the
analysis of fair value of the derivatives shall disclose
contract price in the month of the settlement date determined by the Company.the specific methods used and the setting of relevant
assumptions and parameters
Description of whether the accounting policies and
specific accounting principles for the Company's The accounting policies and specific accounting principles for the Company's derivatives have no significant change compared with that
derivatives have changed significantly compared with of previous reporting period.that of previous reporting period
The Company carries out financial derivatives transactions mainly to avoid foreign exchange risks associated with RMB exchange rate
fluctuations and effectively control the cost uncertainty caused by foreign exchange risks. The Company has formulated the
Special opinions of independent directors on the Management System of Goertek's Financial Derivatives Trading Business which is conducive to strengthen the management and
Company's derivatives investment and risk control control of the risks associated with financial derivatives transactions. The deliberation approval voting and other procedures of this
proposal are in line with the relevant provisions of Company Law Articles of Association and overall interests of the Company without
damage to the legitimate rights and interests of minority shareholders. Therefore the Company has been approved to carry out the
34Goertek Inc. Annual Report 2021
business above.
35Goertek Inc. Annual Report 2021
5. Use of raised funds
√ Applicable □ Not applicable
(1) Overall use of raised funds
√ Applicable □ Not applicable
Unit: RMB 10000
Total Proportion
The
The total amount of Accumulat of Total
Accumulat Purpose of amount of
amount of raised ed total accumulat amount of
ed amount the raised raised
raised funds with amount of ed total raised
Year of Means of Total fund of raised funds that funds that
funds used changed raised amount of funds that
raising raising raised funds that have not have been
during the purposes funds with raised have not
have been been yet idle for
reporting during the changed funds with been yet
used used more than
period reporting purposes changed used
two years
period purposes
Supplemen
ting
working
Public capital and
issuance of deposited
2020398903.00129831.49207055.930.000.000.00%191847.070.00
convertibl in the
e bonds special
account
for raised
funds
Total -- 398903.00 129831.49 207055.93 0.00 0.00 0.00% 191847.07 -- 0.00
Description of overall use of raised funds
The Company actually invested RMB 1298.3149 million in current period. As of December 31 2021 the Company had used a
total of RMB 2070.5593 million of raised funds. The amount of unused raised funds was RMB 1918.4707 million (interest
excluded) of which RMB 1200 million was used to temporarily supplement the working capital and the remaining funds was
deposited in the special account for raised funds of the Company.
(2) Projects in which the raised funds were proposed to be invested
√ Applicable □ Not applicable
Unit: RMB 10000
Whether Total Total Amount Accumul Investme The date Benefits Whether Whether
Committed investment
the committe investme invested ated nt on which realized it there is
projects and investment
project d nt after during investme progress the during achieved any
of over-raised funds
has been investme adjustme the nt at the end project the the significan
36Goertek Inc. Annual Report 2021
changed nt of nt (1) reporting amount at of the reaches reporting expected t change
(includin raised period the end of period (3) its period benefits in the
g partial funds the ＝(2)/(1) intended feasibility
changes) reporting usage of the
period (2) state project
Committed investment projects
The project of true Not
August
wireless smart No 218903 218903 93433 164620.2 75.20% 33365.12 applicabl No
312022
earphones e
AR/VR and related
August
optical module project No 60000 60000 30375.77 30375.77 50.63% 46014.2 Yes No
312022
- AR/VR project
AR/VR and related
Not
optical module project August
No 40000 40000 3168.4 3168.4 7.92% 825.17 applicabl No
- optical module 31 2022
e
project
Not Not
Qingdao R&D center August
No 80000 80000 2854.32 8891.56 11.11% applicabl applicabl No
project 31 2022
e e
Sub-total of committed 129831.4 207055.9
--398903398903----80204.49----
investment projects 9 3
Direction of the investment with over raised funds
Not applicable
129831.4207055.9
Total -- 398903 398903 -- -- 80204.49 -- --
93
Descriptions and
reasons for failure of Due to the impact of the project and the actual needs of the Company the project of Qingdao R&D Center
meeting the planned was behind schedule. The Company may accelerate subsequent investment according to the actual needs
schedule or expected and will strive to achieve the maximum efficiency of the raised funds.revenue (by project)
Description of
significant change in
Not applicable
the feasibility of the
project
Amount use of
over-raised funds and Not applicable
progress of use thereof
Change in location of Applicable
the project invested Occurred in previous years
with raised funds
On August 20 2020 the Company held the 8th meeting of the 5th Board of Directors and the 6th meeting
37Goertek Inc. Annual Report 2021
of the 5th Board of Supervisors which reviewed and approved the Proposal on Changing the
Implementation Subject and Implementation Location of Some Investment Projects with Raised Capital
and Increasing the Capital of Wholly-owned Subsidiaries and agreed to change: the implementation
subject of AR/VR and related optical module projects from Goertek Inc. to wholly-owned subsidiaries
Weifang Goertek and Goertek Optical; The implementation location was changed accordingly from
Goertek Photoelectric Park in Weifang High-tech Zone to Weifang Goertek Plant east of Gaoxin No.2
Road south of Yuqing East Street in Weifang comprehensive free trade zone and Goertek Optical Plant
phase III of Goertek Photoelectric Park in Weifang High-tech Zone; The Company increased the capital to
Weifang Goertek with the raised funds of RMB 600 million and increased the capital to Goertek Optical
with the raised funds of RMB 400 million for the purpose of specific implementation of above-mentioned
investment projects.Adjustment on how to
invest the projects with Not applicable
raised funds
Applicable
On July 9 2020 the Company held the 7th meeting of the 5th Board of Directors and the 5th meeting of
Upfront investment of
the 5th Board of Supervisors which reviewed and approved the Proposal on Replacing the Self-raised
the project with raised
Funds Invested in the Projects in Advance with the Raised Funds and agreed to use the raised funds to
funds and replacement
replace the self-raised funds of RMB 315.7238 million invested in the investment projects in advance. The
thereof
fund replacement above has been verified by Zhongxi Certified Public Accountants (special general
partnership) Co. Ltd. and an authentication report has been issued.Applicable
On July 9 2020 the Company held the 7th meeting of the 5th Board of Directors and the 5th meeting of
the 5th Board of Supervisors which reviewed and approved the Proposal on Temporary Replenishment of
Working Capital with Idle Raised Funds. It was agreed that the Company shall use the idle raised funds not
exceeding RMB 2.5 billion to temporarily supplement working capital. The use period shall not exceed 12
months from the date of approval by the Board of Directors. After expiration it shall be returned to the
special account for raised funds in a timely manner. The Company returned RMB 0.8 billion and RMB 1.7
billion of the raised funds to the special account for raised funds in advance on September 17 2020 and
November 4 2020 respectively. On November 5 2020 the Company held the 11th meeting of the 5th
Temporary
Board of Directors and the 9th meeting of the 5th Board of Supervisors which reviewed and approved the
replenishment of
Proposal on Temporary Replenishment of Working Capital with Partial Idle Raised Funds. It was agreed
working capital with
that the Company temporarily supplements the working capital with idle raised funds of no more than
idle raised funds
RMB 2500 million. The validity period shall not exceed 12 months from the date of approval by the Board
of Directors. After expiration it shall be returned to the special account for raised funds in a timely
manner. The Company returned RMB 0.5 billion and RMB 2 billion of the raised funds to the special
account for raised funds in advance on October 29 2021 and November 3 2021 respectively.On November 8 2021 the Company held the 24th meeting of the 5th Board of Directors and the 19th
meeting of the 5th Board of Supervisors which reviewed and approved the Proposal on Temporary
Replenishment of Working Capital with Partial Idle Raised Funds. It was agreed that the Company
temporarily supplements the working capital with idle raised funds of RMB 1200 million. The validity
period of which shall not exceed 12 months from the date of approval by the Board of Directors. After
38Goertek Inc. Annual Report 2021
expiration it shall be returned to the special account for raised funds in a timely manner.Amount and reasons
for the balance of
raised funds in the Not applicable
implementation of the
project
Purpose of the raised
funds that have not The unused raised funds shall be deposited in the special account for raised funds.been yet used
Problems or other
situations in the use
None
and disclosure of raised
funds
(3) Changes in the projects in which the raised funds were proposed to be invested
□ Applicable √ Not applicable
There was no change in the projects in which the raised funds were proposed to be invested during the reporting period.Ⅷ. Sales of major assets and equities
1. Sales of major assets
□ Applicable √ Not applicable
The Company did not sell any major assets during the reporting period.
2. Sales of major equity
□ Applicable √ Not applicable
Ⅸ. Analysis of major subsidiaries and associates
√ Applicable □ Not applicable
Major subsidiaries and associates with an impact of more than 10% on the Company's net profit
Unit: RMB
Name Type
of of Main Operating Operating
Registered capital Total assets Net asset Net profit
compan compa business revenue profit
y ny
Electronic
Weifang Subsid 2728231919 169578411 149176009
componen 1405601925.00 10971185728.12 3904375154.73
Goertek iary 3.58 6.30 1.98
t
39Goertek Inc. Annual Report 2021
manufactu
ring
Goertek Electronic
Technol componen
Subsid 2065138053 128574095 128003847
ogy t 362762400.00 9395840422.98 2096244381.21
iary 6.59 9.38 4.51
(Vietna manufactu
m) ring
Goertek Electronic
(HongK componen
Subsid 1942236789 836073059. 706793733.ong) t 1542045.00 6835046824.10 1075332121.44
iary 2.29 54 63
Co. manufactu
Limited ring
Acquisition and disposal of subsidiaries during the reporting period
√ Applicable □ Not applicable
Approach on acquisition and
Impact on overall production
Name of company disposal of subsidiaries during the
operation and performance
reporting period
GOERTEK MICROELECTRONICS KOREA CO.LTD. Newly established No significant impact
Description of major subsidiaries and associates
None
Ⅹ. Structural Entities Controlled by the Company
□ Applicable √ Not applicable
XI. Outlook for the Future Development of the Company
1. Industry trend and competition
In the mobile era smartphones and related smart hardware products have been the main focus of innovation and the growth
drivers of the global technology and consumer electronics industry over the past many years. However the growth of smartphone
industry has slowed down in recent years. According to the statistics of IDC a well-known consulting agency the global smartphone
shipment in 2022 is expected to reach 1.39 billion units with year-on-year increase of approximately 3%. It is predicted that the
average annual compound growth rate of smartphone shipments around the world will be about 3% from 2022 to 2025. As the core
hardware in the mobile era the slowdown of smartphone market also reflects the transition to the post-mobile era of the global
technology and consumer electronics industry.In the post-mobile era along with the development of new technologies such as semiconductor 5G micro-display sensor
intelligent interaction battery cloud and edge computing the new generation of smart hardware products are greatly improved in
40Goertek Inc. Annual Report 2021
functions and are suitable for more diversified applications. Many new smart hardware devices with great potential have revealed
themselves. In particular the products such as VR/AR smart wearable devices and smart wireless earphones have maintained a rapid
growth in recent years which attracts extensive attention in the global market. These products are expected to become the driving
force for further development of global intelligent hardware market in the post-mobile era.According to the statistics of IDC the global shipment of VR/AR products is expected to reach 19.10 million units in 2022 with
approximately 67.5% YoY increase. The CAGR of global VR shipment from 2022 to 2025 is expected to be about 59.2%. The
number of end users keeps growing steadily along with the upgrade of VR hardware. With the development and maturity of VR
content and applications such as social networking games entertainment and live broadcasting VR products are expected to boost in
the next few years. According to the statistics of IDC the global shipment of AR products is expected to reach 1.35 million units in
2022 with approximately 309% YoY increase. The CAGR of global AR shipment from 2022 to 2025 is expected to reach
approximately 121.4%. With the concept of "integration of virtual content and real life" and the ability to seamlessly connect to
smartphone ecosystem AR product shows unlimited future possibilities and great market potentials and is expected to become one
of the core smart hardware products in consumer electronics industry in the post-mobile era. Many well-known brand companies and
start-ups in the industry continue to explore and tackle the key technological roadblocks in semiconductor chips optical waveguide
micro displays new materials and other fields. The break-thru of those technologies are also expected to create a broader path for AR
products in the next few years.According to the statistics of CCS Insight a famous consulting agency the global shipment of smart wearable products is
expected to reach 270 million units in 2022 with approximately 16.4% YoY increase. In the post epidemic era consumers pay
greater attention to sports and health. For billions of people over the globe who may have hypertension diabetes or other sub-health
situations high precision and reliable health monitoring technologies especially blood pressure monitoring and non-invasive blood
sugar level monitoring technology are the focus of innovation in smart wearable devices and have attracted significant amount of
investment from many industry leaders. The maturity and application of above technologies are expected to bring dramatic growth
for smart wearable products in future.According to the statistics of Futuresource a well-known consulting agency the global shipment of smart wireless earphones is
expected to keep growing steadily in the next few years and the CAGR of TWS earphones from 2021 to 2025 is expected to reach
about 21.8%. With improved voice interaction function more product choices better features and user experience the TWS product
penetration in the global earphone market is expected to increase continuously.The rapid development of emerging intelligent hardware products has also boosted the demand for related precision components
such as precision optics and modules precision acoustic components MEMS sensors and micro system modules haptic components
and precision structural parts which creates new business opportunities for the precision components of the Company.
41Goertek Inc. Annual Report 2021
From the perspective of competition among brand companies the global technology and consumer electronics industry may
continue to demonstrate a centralized trend. In the post-mobile era massive investment in technological innovation and R&D is
required for the development of smart hardware products for which the "soft power" of the ecosystem such as developer base user
base software applications entertainment content community loyalty and data monetization becomes more and more crucial. The
leading enterprises with capital talent technology and ecosystem advantages are expected to strengthen their competitive advantages
so as to lead technology and product innovation in the industry.From the perspective of supply chain the middle-end of supply chain is expected to remain relying on developing countries.The electronic manufacturers in China are strengthening their overall competitiveness and continue to expand their business in other
countries. China manufacturers are expected to meet the needs of smart hardware production in the post-mobile era and gain the new
opportunities of development. At the same time we also need to pay attention to the development and changes of international
political and economic situation. The changes in science technology trade and other policies between countries as well as major
international events and their development may also have significant impact to the competition and supply chain of global industry.Therefore we need to pay continuous attention and respond positively.
2. Strategy for future development
Looking into the future the Company will actively respond to the strategy of actualizing innovation-driven development and
accelerating the development of modern industrial system and grasp the opportunities of transformation from the mobile era to the
post-mobile era by closely following the development of 5G AI IoT cloud computing and other advanced technologies. The
Company will continue to strengthen its development in the field of advanced precision components and next generation smart
hardware products constantly consolidate the strategical cooperation with world-class customers and earnestly fulfill the economic
and social responsibilities of the enterprises thus achieving a long-term stable and healthy growth of the business and maximize the
enterprise value and the return to shareholders.
(1) Actively grasp the new opportunities in the post-mobile era and further promote the Company's strategy of "precision
components + smart hardware". Further develop the businesses of precision components such as acoustics optics microelectronics
and structural parts and the businesses of smart hardware devices such as VR/AR smart wireless earphones smart wearable and
smart home devices. Continue to strengthen the advantages of precision components business in smartphone and other traditional
hardware and actively develop precision components and system hardware business related to new generation of smart hardware
products. Utilize the synergy between the Company's component and hardware device business continue to strengthen the core
competence in precision manufacturing and intelligent manufacturing and provide customers with the first-class vertically integrated
product solutions and "one-stop" R&D and manufacturing services.
(2) Continue the key-account strategy remain customer orientation and utilize the Company's advantages in customer resource.
42Goertek Inc. Annual Report 2021
Focus on serving leading customers in the global technology and consumer electronics industry and continue to consolidate
long-term strategic cooperation with customers. Closely follow the strategical planning and development of world-class customers
and to create a global system of R&D manufacturing and sales services accordingly. Continue to satisfy our customers with our
business technology engineering operation and delivery services in order to achieve win-win cooperation and to grow with the
world-class customers.
(3) Adhere to technological innovation and continue to invest in R&D. Constantly improve the Company's technical
competitiveness in acoustics optics microelectronics precision manufacturing automation IT technology software algorithm and
so on and actively expand the layout in emerging technologies such as micro system modules optical waveguide nano-imprinting
haptics and etc. to build the core technical competitiveness of the enterprise. Firmly implement the talent strategy by integrating the
outstanding talents in management and technology fields around the world build and effectively motivate a first-class talent team
thus to provide sufficient talents for future development of the Company.
(4) Constantly improve corporate governance and management and promote the standardized and efficient internal operation.
Continuously improve the internal structure processes and internal management system. Strengthen the awareness of lean operation
improve the level of lean operation and seek benefits from it. Being market-oriented and customer-oriented continues to push
forward internal reform and innovation and to build core competitiveness upon continuous reform and innovation activities. Create
an excellent corporate culture undertake the core values of "customer orientation personnel growth integrity and pragmatism
win-win cooperation" and earnestly fulfill the economic and social responsibilities of the enterprise to become a respected
world-class enterprise.
3. Business operation during the reporting period and business plan for next year
In 2021 the Company grasped the business opportunities of the new generation of smart hardware such as VR TWS smart
wearable devices gaming consoles and accessories implement the "precision components + smart hardware" strategy and utilized
the synergy between the components business and system device business. The Company adhered to customer-orientation philosophy
and focused on key business accounts provided customers with high-quality R&D and manufacturing “one-stop” service and
achieved customer satisfaction. The Company also explored new business opportunities in precision optical components and modules
micro-system modules MEMS sensors haptic components etc. From internal operation perspective the Company continuously
improved the level of lean operation and obtained solid progresses in input/output efficiency operation cycle inventory turnover
and capital cost. The Company continued to invest in R&D and technological innovation increased the quantity of both patent
applications and patent approvals strengthened the capabilities of R&D and talent team and thus further consolidated the core
competitiveness in technology field. The Company also formulated and implemented effective systems and measures to ensure stable
operation of business activities and control the risks. With all the measures above the Company has finally achieved an excellent
43Goertek Inc. Annual Report 2021
business performance in 2021.Looking into the year of 2022 the Company still faces many challenges due to the ongoing global epidemic the slow recovery
of global economy the high and fluctuated commodity prices and other complexities and uncertainties that may applied to the
external environment. On the bright side there are also new opportunities in global technology and consumer electronics industry.With the further integration and development of advanced technologies such as 5G AI and the new generation of smart hardware
products the Company faces new opportunities in both precision components and smart hardware business. The management and all
staff of the Company will continue to implement our strategy and to achieve business objectives so as to return the shareholders and
investors with excellent business performance and continuous growth of enterprise value.
(1) Maintain strategic focus and grasp development opportunities. The Company will seize the business opportunities of smart
hardware products in the post-mobile era by adhering to the "precision components + smart hardware" strategy and utilize the
synergy between the components and system device business. With core technological capabilities and advanced precision
component solutions the Company will further enhance the effort in business development of smart hardware products. And through
that business development the Company will create more applications and demand for the precision components. By integrating the
core capabilities in precision manufacturing and intelligent manufacturing the Company will be able to provide first-class "one-stop"
R&D and manufacturing services to global customers.
(2) Adhere to the customer-orientation philosophy and key-accounts strategy and identify and serve strategic customers. Follow
the strategy and business plan of core customers the Company will carry out corresponding business products and capacity plans
work with the customer in their frameworks and schedules and provide industry-leading R&D and manufacturing services. The
Company will continuously build excellent customer service team to satisfy our customers in long term in all aspects of business
technology engineering operation and delivery to enhance customer loyalty and achieve win-win cooperation with customers.
(3) Empower business expansion and create new opportunities. Based on the consolidation of the existing business advantages
in precision components and smart hardware products the Company will further explore new directions and opportunities. By
grasping the opportunities in micro-system modules MEMS sensors precision optical components and modules haptic components
precision structured parts VR smart home products and other products the Company will secure the key projects of core customers
and also follow up with new directions and opportunities in automotive electronics advanced materials micro-display technology
and other fields with future potentials.
(4) Improve lean operation and complete successful delivery of key projects. The Company will continue to promote the
awareness and improve the level of lean operation and to support the business objectives with high-quality and efficient operation.The Company will make thorough planning of its resources ensure the delivery of key projects that closely related to the strategy and
the business objectives and to achieve the goals of the Company.
44Goertek Inc. Annual Report 2021
(5) Continue to invest in R&D and technological innovation strengthen core competitiveness with talent strategy. The Company
will continue to invest in R&D and technological innovations centered on future strategic directions and strengthen the technical
capabilities in the fields of acoustics optics microelectronics precision manufacturing and intelligent manufacturing. The Company
will embrace the management and technical talents globally keep bringing in high-level talents carry out solid efforts in the selection
cultivation motivation and retention of talents and to support the Company's strategic implementation and business development
with high-quality talent echelon.
(6) Effectively control risks and maintain healthy operation. The Company will continue to maintain a sound business strategy
strengthen risk awareness pay close attention to changes in the external environment perform effective control on risk indicators in
production operation of the Company take the initiative to identify and resolve potential risks and ensure sustainable development of
production and operation activities.
4. The demand and planning of fund
The Company maintains a healthy asset and liability structure and obtained a good long-term cooperative relationship with
banks and other major financial institutions. In 2021 the Company successfully completed the conversion and delisting of the
previously issued convertible bonds and successfully completed the signing of long-term loan agreements between its subsidiary
companies and International Finance Corporation which further improved the Company's balance sheet structure and cost of funds.The Company will continue to improve the management of cash asset-liability ratio and debt structure to actively avoid liquidity
risks and foreign exchange risks to control financial derivatives trading activities with strict standards and thus providing stable and
sufficient financial support to the development of the Company.
5. Future risks
(1) Macroeconomic risks
COVID-19 pandemic has not yet stopped globally and the global economy is still in recovery. Unfavorable factors that affecting
investment and consumption still exist which may hinder global technology and consumer electronics industry from rapid
development in the short term. The world political and economic situation remains complex and grim. Trade disputes between major
countries and geopolitical events have brought uncertainties to global economy which may adversely affect the business of
enterprises. The slow growth of some smart hardware products such as smartphones may affect the market demand of precision
components which may bring negative impact to the Company's performance.
(2) Operational risks
* Risks of concentrated customer structure
The competitive pattern of global technology and consumer electronics industry along with the Company's business model and
key account strategy determined a relatively concentrated customer structure. As a result the business income from a few core
45Goertek Inc. Annual Report 2021
customers accounts for a large proportion of the Company's overall revenue. Although the above customers are global industry
leaders who have significant competitive advantages and market position and have maintained long-term and stable cooperative
relations with the Company under some special circumstances they may bring fluctuations and risks to the Company's business if
their business activities fluctuate.* Risks of exchange rate fluctuation
The export business accounts for a high proportion of the Company's overall revenue. At the same time the Company also
imports a considerable number of raw materials equipment and other products from overseas. These import and export businesses
are primarily settled in US dollars. Although the Company has adopted appropriate risk hedging tools the significant fluctuation of
RMB/US dollar exchange rate may still bring certain exchange rate risks to the Company.* Risks of the leaving of core technical talents
The technology and consumer electronics industry is a talent intensive industry. Therefore the demand for core technical talents
is strong and the competition for talents is very fierce. Core technical talents are the key resources for the Company to continuously
improve its core competitiveness and realize long-term development. For this reason the Company will continue to improve various
incentive and restraint mechanisms in order to retain core technical talents. But due to the fierce competition loss of core technical
talents may still occur which may put the Company at a disadvantage in the competition and affect the business development in
some cases.
(3) Risks of management
In recent years the Company has successfully expanded its business in each product line. The business scale has been expanded
significantly as well as the variety of products and the size of the staff has grown rapidly. The growing business brings higher
requirements to the Company in overall operation and management ability. The Company implements the strategic plan of
developing core customer business and exploring new opportunities which also requires the Company's management to maintain
excellent abilities of judgment execution and management. If the Company's management fails to match the business growth or fails
to be improved to meet the needs of the Company's development it may affect the execution of strategic planning and the delivery of
business objectives thus bringing management risks to the Company.Ⅻ. Reception research communication interview and other activities during the reporting
period
√ Applicable □ Not applicable
Type of Main content of
Reception Index of basic
Reception time Reception mode reception Reception object discussion and
place information of survey
object information
46Goertek Inc. Annual Report 2021
provided
Investors participating Refer to the record of
The Company's
in the Company's investor relations
The operation and
March 30 2021 Other Institution performance activities on March 30
Company business
presentation meeting 2021 published on
development
of 2020 www.cnifo.com.cn
Refer to the record of
E Fund Bosera Fund The Company's
investor relations
The Communication Dacheng Fund Hua operation and
April 22 2021 Institution activities on April 22
Company over phone An Fund and other business
2021 published on
funds development
www.cnifo.com.cn
Refer to the record of
SOOCHOW Fund The Company's
investor relations
The Communication CR Yuanta Fund operation and
July 22 2021 Institution activities on July 22
Company over phone BOC Fund YINHUA business
2021 published on
Fund and other funds development
www.cnifo.com.cn
Refer to the record of
Fullgoal Fund The Company's
investor relations
The Communication Xingquan Fund 99 operation and
August 27 2021 Institution activities on August 27
Company over phone Fund CCB Fund and business
2021 published on
other funds development
www.cnifo.com.cn
Cninfo.com record of
E Fund Hua An The Company's
investor relations
The Communication Fund GF Securities operation and
October 27 2021 Institution activities on October
Company over phone Harvest Fund and business
27 2021 published on
other funds development
www.cnifo.com.cn
47Goertek Inc. Annual Report 2021
Section IV Corporate Governance
Ⅰ. Corporate Governance in Practice
During the reporting period the Company continuously improved the corporate governance structure the internal management
and control system and continued to carry out corporate governance activities in strict accordance with the requirements of relevant
laws regulations and normative documents such as Company Law Securities Law Corporate Governance of Listed Companies
Rules Governing the Listing of Shares on Shenzhen Stock Exchange as well as with relevant documents of China Securities
Regulatory Commission and the relevant instructions of Shandong Securities Regulatory Bureau so as to further standardize the
Company's operation and improve the level of corporate governance.By the end of the reporting period the actual practice of corporate governance met the relevant requirements of the above laws
administrative regulations departmental rules and normative documents on the governance of listed companies and no documents
concerning administrative supervision measures taken by the supervised departments was received.By the end of the reporting period the details of actual practice of corporate governance are as follows:
1. Shareholders and shareholders' meetings: The Company has convened and held shareholders' meetings in strict accordance
with the Rules for General Meeting of Shareholders of Listed Companies and the Company’s Rules of Procedure of Shareholders'
Meetings so as to ensure that all shareholders especially minority shareholders enjoy equal status and fully exercise their rights; In
addition lawyers were engaged to witness the legitimacy of the convening holding and voting procedures of each general meeting of
shareholders.
2. The Company and controlling shareholders: The Company with independent business and operation autonomy is
independent of the controlling shareholders in business personnel assets organisations and finance. The Board of Directors Board
of Supervisors and internal institutions of the Company operate independently. The controlling shareholders exercise their rights
through shareholders’ meeting and there was no direct or indirect interference with the Company’s operations and decision-making
beyond the general meeting of shareholders.
3. Directors and the Board of Directors: The Company elects directors in strict accordance with the selection and appointment
procedures stipulated in the Articles of Association. There are three independent directors in the Board the number of directors and
the composition of the Board of Directors meet the requirements of laws and regulations and the Articles of Association. All directors
can carry out their work in accordance with Rules of Procedure of the Board of Directors and Working System for Independent
Directors they attended all the Board of Directors meetings and all the related trainings as required.
48Goertek Inc. Annual Report 2021
4. Supervisors and the Board of Supervisors: The election of supervisors and the composition of the Board of Supervisors were
in strict accordance with relevant provisions of Company Law and Articles of Association. The Company's supervisors strictly
followed the Rules of Procedure of the Board of Supervisors All supervisors scrupulously attended the sessions seriously fulfilled
their duties diligently and supervised and issued opinions for major issues related-party transactions and financial status.
5. Performance appraisals and incentives: The Company has gradually improving its fair and transparent performance evaluation
standards and incentive a restraint mechanisms for directors supervisors and senior management. The appointment of Company’s
senior management is open and transparent and in line with the provisions of laws and regulations.
6. Stakeholders: The Company fully respects and safeguards the legitimate rights and interests of stakeholders actively
communicates and coordinates with stakeholders to r balance the interests of the society shareholders the Company employees and
other parties and jointly promotes the Company's development in a sustainable and steady manner.
7. Information disclosure and transparency: The Company duly performed the disclosure obligations in accordance with the
provisions of Rules Governing the Listing of Shares on Shenzhen Stock Exchange Articles of Association and Investor Relations
Management Rules and discloses information as per the law so as to ensure that the information disclosure is true timely accurate
and complete. All shareholders were given equal access to the information. The Company has gradually revised and improved the
Insider Information Management Rules further improved the insider information management strengthened the confidentiality of
insider information maintained the fair principle of information disclosure and protected the legitimate rights and interests of
investors. The Company has appointed the secretary of the Board of Directors as the head of investor relations management of the
Company responsible for the Company's information disclosure and investor relations management. The Company has designated
Securities Times China Securities Journal Shanghai Securities News Securities Daily and cninfo.com.cn to disclose Company’s
information in a faithful accurate and timely manner strictly in accordance with relevant laws and regulations so that all
shareholders have a fair chance to get information.Whether there is any significant difference between actual situation of corporate governance and laws administrative regulations and
the provisions on governance of listed companies issued by CSRC
□ Yes √ No
There is no significant difference between the actual situation of corporate governance and the laws administrative regulations and
the provisions on governance of listed companies issued by CSRC
Ⅱ. Particulars about the independence of the Company from controlling shareholder and
actual controller in terms of the assets personnel finance organization and business
The Company is completely separated from the controlling shareholders in terms of business personnel assets organization
and finance. The ownership of the assets are clear and belongs to the Company. The Company has the capability of self-operation in
49Goertek Inc. Annual Report 2021
its marketing production and procurement does not depend on major shareholders or their affiliated enterprises. There is no mixed
operation with major shareholders.
1. Business independence: The Company had its own production procurement and sales system and was completely
independent of controlling shareholder in terms of business.
2. Personnel separation: There is a department responsible for the Company's labor personnel and salary management in the
Company and rules and regulations has been established for appraisal of employees’ performance. Personnel of the Company were
independent from the controlling shareholder. The Senior Management of the Company did not hold any positions other than director
and supervisor in the related shareholders and other entities with same or similar business.
3. Institutional independence: The Board of Directors Board of Supervisors Senior Management and other internal organization
of the Company operated independently and each functional department is completely independent from controlling shareholder in
terms of authority personnel production operation premises and there is no subordinate relationship between the controlling
shareholder and its functional departments.
4. Asset independence: The title relationship between the Company and the controlling shareholder was clear. The Company’s
assets were complete. The Company has independent and complete production system auxiliary production system and supporting
facilities as well as land use right industrial property right patented technology and other assets.
5. Financial independence: The Company has its own separate financial department and an independent accounting system and
financial management system from the controlling shareholder. The Company makes financial decisions on its own according to the
requirements of relevant accounting systems of listed companies. At the same time implement vertical and straight-line management
on financial affairs of its subsidiaries. The Company opened accounts in the bank independently made tax declarations and
performed tax obligations independent of shareholders according to law.Ⅲ. Horizontal Competition
□ Applicable √ Not applicable
50Goertek Inc. Annual Report 2021
Ⅳ. Annual General Meeting and Extraordinary General Meeting held during the Reporting Period
1. General meeting of shareholders during the reporting period
Percentage
Session Type of meeting of investor Convening date Disclosure date Meeting resolution
participation
Annual general Resolutions for the Annual General Meeting of Shareholders disclosed by the Company
General meeting of
meeting of 35.29% May 7 2021 May 8 2021 on Cninfo (www.cninfo.com.cn) and the four designated newspapers on 8 May
shareholders of 2020
shareholders 2021(Announcement No 2021-083)
The first extraordinary Extraordinary Resolutions for the First Extraordinatry General Meeting of Shareholders in 2021
general meeting of general meeting 48.53% November 25 2021 November 26 2021 disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
shareholders in 2021 of shareholders newspapers on 26 November 2021(Announcement No 2021-125)
The second
Extraordinary Resolutions for the Second Extraordinatry General Meeting of Shareholders in 2021
extraordinary general
general meeting 45.94% December 16 2021 December 17 2021 disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
meeting of shareholders
of shareholders newspapers on 17 December 2021(Announcement No 2021-132)
in 2021
2. Extraordinary general meeting of shareholders requested by the Preferred shareholders with voting rights restored
□ Applicable √ Not applicable
51Goertek Inc. Annual Report 2021
V. Directors Supervisors and Senior Management
1. Basic Information
Number of Number of Number of
shares held shares shares Other increase Number of shares
Appointment Reason for change in
Name Position Gender Age Term start date Term end date at the increased decreased or decrease held at the end of
status shares
beginning of during the during the changes the period
the period period period
Shareholding reduction;
November 7
Jiang Bin Chairman Incumbent Male 56 July 27 2007 373487406 86090000 287397406 transfer to persons
2022
acting in concert
Vice November 7
July 27 2007 Shares granted to
Chairman 2022
Jiang Long Incumbent Male 48 197255197 53090000 250345197 persons acting in
October 30 November 12
President concert
20142022
February 4 November 7
Director Incumbent
20162022
Vice March 25 November 12
Incumbent
Duan Huilu President Male 46 2011 2022 4474500 1000000 3474500 Reduction
Chief
August 12 January 27
Financial Resigned
20102021
Officer
Liu November 29 November 7
Director Incumbent Male 51
Chengmin 2016 2022
Xia Independent October 20 November 7
Incumbent Female 64
Shanhong Director 2016 2022
52Goertek Inc. Annual Report 2021
Independent November 8 November 7
Wang Kun Incumbent Female 46
Director 2019 2022
Wang Independent October 20 November 7
Incumbent Male 62
Tianmiao Director 2016 2022
Chairman of
Sun September 17 November 7
Board of Incumbent Male 56 8889534 1800000 7089534 Reduction
Hongbin 2013 2022
Supervisors
Employee
Feng
representativ Resigned Male 48 July 27 2007 April 27 2021
Jianliang
e Supervisor
Employee
Xu September 17 October 17
representativ Incumbent Female 45
Xiaofeng 2013 2022
e Supervisor
Gao Vice November 12
Incumbent Male 46 April 12 2012
Xiaoguang President 2022
Vice October 10 November 12
Liu Chunfa Incumbent Male 46 1151864 287864 864000 Reduction
President 2013 2022
Jiang Vice October 10 November 12
Incumbent Male 52
Hongzhai President 2013 2022
Vice
President October 10 November 12
Jia Jun'an Incumbent Male 51 200000 200000
Secretary of 2013 2022
the Board
Feng Vice October 24 September 10
Resigned Male 54
Pengbo President 2016 2021
Vice October 24 November 12
Yu Dachao Incumbent Male 44
President 2016 2022
53Goertek Inc. Annual Report 2021
Kazuyoshi Vice October 24 November 12
Incumbent Male 55
Yoshinaga President 2016 2022
Chief
January 27 November 12
Li Yongzhi Financial Incumbent Male 44
20212022
Officer
Employee
October 17
Wei Wenbin representativ Appointed Male 44 April 27 2021
2022
e Supervisor
Vice November 12
Li Youbo Appointed Male 45 June 2 2021
President 2022
Zhu Vice November 12
Appointed Male 48 June 2 2021
Shengbo President 2022
Total -- -- -- -- -- -- 585458501 53090000 89177864 549370637 --
54Goertek Inc. Annual Report 2021
Whether there is any resignation of directors supervisors and senior management during the reporting period
√ Yes □ No
During the reporting period chief financial officer Duan Huilu and vice president Feng Pengbo resigned because of job
re-arrangement and the employee representative supervisor Feng Jianliang resigned during the term of office due to job adjustment.Changes in directors supervisors and senior management
√ Applicable □ Not applicable
Name Position Type Date Reason
Chief Financial
Duan Huilu Resigned January 27 2021 Job arrangement
Officer
Employee
Feng Jianliang representative Resigned April 26 2021 Job adjustment
supervisor
Employee
Wei Wenbin representative Elected April 27 2021 Job arrangement
supervisor
Li Youbo Vice President Appointed June 2 2021 Job arrangement
Zhu Shengbo Vice President Appointed June 2 2021 Job arrangement
September 10
Feng Pengbo Vice President Resigned Job arrangement
2021
2. Biographical Information
Professional backgrounds main working experience and current duties of the Directors Supervisors and the Senior
Management
Directors:
Mr. Jiang Bin:
Mr. Jiang Chairman of the company master's degree holder of business administration from Tsinghua University bachelor's
degree holder of electronic engineering from Beihang University. Mr. Jiang founded Goertek Inc. in 2001. He has more than 30 years
of working experience in the electro-acoustic industry. He also serves as standing member of the 12th executive committee of the
All-China Federation of Industry and Commerce rotating chairman of China Electronic Components Association and vice chairman
of Industry of Virtual Reality Alliance. He has successively won the titles of National Model Worker Outstanding Entrepreneur of
Chinese Electronic Information Industry National Labor Medal of Shandong Province Labor Model of Shandong Province
Outstanding Entrepreneur of Shandong Province etc.Mr. Jiang Long:
55Goertek Inc. Annual Report 2021
Mr. Jiang Vice Chairman and President of the company Ph.D in strategic management the University of Maryland a master's
degree holder in management science from Renmin University of China and a bachelor's degree holder in materials engineering
from Tsinghua University. Joined the Company in 2004 Mr. Jiang successively served as vice president senior vice president and
executive vice president of the company. Mr. Jiang is also the Vice President of China Audio Industry Association and the chairman
of China Electronic Components Association-Electroacoustic Chapter. Mr. Jiang has extensive experience in marketing sales and
business management.Mr. Duan Huilu:
Mr. Duan Director and Vice President of the company bachelor's degree holder from Shandong University of Finance and
Economics. He joined the company in 2001 and successively served as the company's accountant finance manager finance
department manager and chief financial officer. Mr. Duan has more than 20 years of working experience.Mr. Liu Chengmin:
Mr. Liu Director of the company master's degree holder in mechanics from Harbin Institute of Technology. Mr. Liu currently
serves as chairman of Beijing Fargo Capital Co. Ltd. managing partner of Tianjin Longyuan Yunteng Investment Management
Partnership and technology consultant of China Ping An Trust Co. Ltd. Mr. Liu used to serve as director of the telecom division of
Huawei's domestic marketing department senior executive vice president of Tencent and president of Tencent Wireless Internet
Business Group. He has rich experience in telecom and Internet.Ms. Xia Shanhong:
Ms. Xia Independent Director of the company. Ms. Xia used to serve as deputy director of the Institute of Electronics Chinese
Academy of Sciences director researcher and doctoral supervisor of the State Key Laboratory of Transducer Technology and
received special government allowance from the State Council. She received a bachelor's degree from Tsinghua University a
master's degree from the Chinese Academy of Sciences and a doctorate from the University of Cambridge in England. Ms. Xia is the
Royal Fellowship visiting scholar of the Royal Society and the Berkeley Scholarship visiting scholar of the University of California
Berkeley. She used to be the chief scientist of the National 973 Project member of the MEMS overall expert group of the National
863 Program and member of its advanced manufacturing technology expert group member of the expert review team of the
Department of Information Sciences of the National Natural Science Foundation of China and chairman of the Transducers. Ms. Xia
currently serves as member and director of Chinese Institute of Electronics director of China Instrument and Control Society as well
as vice chairman of its sensor branch member of Chinese Society of Micro-Nano Technology and editorial board member of many
international academic journals.Mr. Wang Tianmiao:
56Goertek Inc. Annual Report 2021
Mr. Wang Independent Director of the company. Professor and Ph.D Tutor of Beihang University o Honorary Director of
Institute of Robotics at Beijing University of Aeronautics and Astronautics， Dean of Zhongguancun College of Innovation Angel.He received a doctorate and masters’ degree holder from Northwestern Polytechnic University and a bachelor's degree holder from
Xi'an Jiaotong University. He is one of the distinguished professors of the Changjiang Scholars winner of the National Science Fund
for Distinguished Young Scholars member of the Advanced Robot Technology Innovation Team for National Defense chief expert
group leader in the field of advanced manufacturing under 863 National High-tech R&D Program in the 11th Five-Year Plan head of
the expert group of the Service Robotics program in the 12th Five-Year Plan and president of the IEEE Robotics and Automation
Society (Beijing region). He is mainly engaged in the research of advanced robot theory and technology including bionic structure
medical robot service robot and so on. Mr. Wang has won two second-class awards of National Science and Technology Progress
Award and one first-class award of Beijing Science and Technology Progress Award. He is also an independent director of Shanghai
STEP Electric Corporation.Ms. Wang Kun:
Ms. Wang Independent Director of the company. She serves as an associate professor in the School of Accounting School of
Economics and Management at Tsinghua University. She received her doctorate in Accounting from Hong Kong University of
Science and Technology and her bachelor's degree in Accounting from Nankai University. She joined the School of Accounting
School of Economics and Management at Tsinghua University in April 2003 and worked as a lecturer and associate professor. She
served as deputy director and senior researcher of the Research Center of Corporate Governance of Tsinghua University from
January 2010. Ms. Wang served as the Ph. D. program director of the Accounting Department of the School of Economics and
Management of Tsinghua University from January 2011 to December 2013. She has won the Excellence in Teaching Award of the
School of Economics and Management of Tsinghua University for several times. Ms. Wang is also an Independent Director of China
International Futures Co. Ltd. Ms. Wang used to be the Independent Director of Beijing Thunisoft Co. Ltd. and Integrated
Electronic Systems Lab Co. Ltd. Ms. Wang has rich experience in the fields of finance and auditing.Supervisors:
Mr. Sun Hongbin:
Chairman of the Board of Supervisors. Bachelor in industrial automation from Shandong University. He used to serve as deputy
general manager of the company manager and director of the business department of China Electronics Import and export Shandong
Corporation. Mr. Sun owns more than 30 years of working experience in marketing and import & export business.Ms. Xu Xiaofeng:
Employee Representative of the Board of Supervisors. Bachelor of Business Administration China University of Petroleum.She graduated from the Zhengzhou University of Aeronautics Electrical Technology Major. Ms. Xu joined the company in 2001
57Goertek Inc. Annual Report 2021
and successively served as the assistant manager of the quality control department the enterprise development department and the
operation department and is now in charge of the company's employee service center. Ms. Xu has rich experience in business
management.Mr. Wei Wenbin:
Employee Representative of the Board of Supervisors. Graduated from Jilin University majoring in material forming and control
engineering he is currently in charge of the staff management department of the company. Mr. Wei joined the company in 2004 and
successively served as the head of the company's production and operation management department human resources management
department lean manufacturing management department and other related departments.Senior Management:
Mr. Jiang Long:
Refer to the resume above for details.Mr. Duan Huilu:
Refer to the resume above for details.Mr. Gao Xiaoguang:
Vice President of the company. Master's Degree in business administration from Southern Cross University in Australia. He
joined the company in 2001 and successively served as manager of the device marketing department deputy manager of the device
marketing department general manager of the device business department and head of the marketing. He has rich experience in
market developing and key client maintaining.Mr. Liu Chunfa:
Vice President of the company. Mr. Liu graduated from Lanzhou Railway Institute. He successively served as engineer of R &
D department chief of quality assurance department assistant manager technical manager of technical engineering department
senior product manager head of manufacturing department senior manager of R & D department etc. Mr. Liu has rich experience in
the fields of electroacoustic components especially in miniature loudspeakers and receivers.Mr. Jiang Hongzhai:
Vice President of the company. Mr. Jiang graduated from Shandong College of Information Technology.. Joined the company
in 2006 Mr. Jiang is mainly responsible for the management of mold injection molding stamping and so on. Mr. Jiang used to serve
as factory director of Yuefeng Electronic Technology (Dongguan) Co. Ltd. and engineer of Weifang Radio Eighth Factory. Mr.Jiang has more than 20 years of technical management experience in the field of precision machining.Mr. Jia Junan:
58Goertek Inc. Annual Report 2021
Vice President and the Secretary of the Board. Ph.D in Economics Xiamen University Master of Economics Shandong
University Bachelor of Economics Shandong University of Finance and Economics. Mr. Jia is the member of the Chinese Institute
of Certified Public Accountants（CICPA）and the Association of Chartered Certified Accountants（ACCA). Mr. Jia joined thecompany in 2010 and served as deputy general manager of financial department. He used to serve as the tax manager of KPMG
Enterprise Consulting (China) Co. Ltd. Qingdao Branch. Mr. Jia holds the Certificate for Secretary of the Board of Directors and
his qualification complies with relevant provisions of Rules Governing the Listing of Shares on Shenzhen Stock Exchange and the
Articles of Association.Mr. Yu Dachao:
Vice President of the company. Bachelor's in computer science and engineering Tianjin University of Technology. He was in
charge of the company's Bluetooth headsets active 3D glasses and accessories for household video games. He has rich experience in
the R&D and manufacturing of electronic accessories.Mr. Kazuyoshi Yoshinaga:
Vice President of the company. Japanese. He holds a master's degree in business administration from University of Washington
and a bachelor's degree in mechanics from Tongji University. He used to be the associate partner of IBM and has extensive
experience in the field of strategy and transformation management. He also serves as deputy secretary-general of the China Virtual
Reality Industry Association.Mr. Li Yongzhi:
Chief Financial Officer of the company and the Head of the Accounting Office. Mr. Li holds a bachelor's degree in management
and a master's degree in business management from Hefei University of Technology. He joined Goertek in 2005 and successively
served as accountant and financial manager of the financial department. Mr. Li is senior accountant and certified managementaccountant（CMA) with more than 15 years of experience in corporate finance. After deliberation and approval by the 14th meetingof the fifth Board of Directors he was appointed as the Chief Financial Officer of the company. His term of office begins from the
approval date of Board of Directors to the expiration date of the current Board of Directors’ term of office.Mr. Li Youbo:
Vice President of the company. Mr. Li holds a bachelor's degree in automation from Dalian University of Technology. He
joined the company in 2003 and successively served as engineer technical manager head of the business department etc. Mr. Li has
nearly 20 years of experience in R&D and manufacturing of electroacoustic components.Mr. Zhu Shengbo:
Vice President of the company. Mr. Zhu graduated from Shenyang University of Technology. He joined the company in 2005
and successively served as production manager assistant minister minister senior minister and head of the business department. He
59Goertek Inc. Annual Report 2021
used to serve as production director of Dongguan Samsung Electro-Mechanics Co. Ltd. Mr. Zhu has more than 20 years of
experience in manufacturing operation and management of consumer electronic products such as parts accessories and devices.Positions held in shareholders’ entities
√ Applicable □ Not applicable
Receive
Position
remuneration or
undertaken in
Name Name of the shareholder entity Term start date Term end date allowance from
shareholder
shareholders’ entity
entity
(Yes/No)
Jiang Bin Goertek Group Co. Ltd. Chairman November 15 2021 November 14 2024 No
Jiang Long Goertek Group Co. Ltd. Director November 15 2021 November 14 2024 No
Duan Huilu Goertek Group Co. Ltd. Director November 15 2021 November 14 2024 No
General
Sun Hongbin Goertek Group Co. Ltd. November 15 2021 November 14 2024 Yes
Manager
Positions held in other entities
√ Applicable □ Not applicable
Receive
Position
remuneration or
undertaken
Name Name of other entity Term start date Term end date allowance from
in other
shareholders’
entity
entity (Yes/No)
Weifang Goertek Electronics Co.Jiang Bin Chairman November 23 2019 November 22 2022 No
Ltd.Beijing Goertek Investment Executive
Jiang Bin January 22 2019 January 21 2022 No
Management Co. Ltd. Director
Weifang Goer Education Investment Executive
Jiang Bin March 22 2019 March 21 2022 No
Co. Ltd. Director
Rongcheng Goertek Technology Executive
Jiang Long July 15 2020 July 14 2023 No
Co. Ltd. Director
Goertek Technology Vina Company
Jiang Long Chairman January 31 2019 December 31 2021 No
Limited
Executive
Jiang Long Goertek Electronics Inc. May 1 2020 April 30 2023 No
Director
Director /
Weifang Goertek Electronics Co.Jiang Long General November 26 2019 November 25 2022 No
Ltd.Manager
Executive
Jiang Long Goertek Technology Co. Ltd. December 10 2021 December 9 2026 No
Director /
60Goertek Inc. Annual Report 2021
General
Manager
Executive
Goertek Intelligence Technology Director /
Jiang Long August 18 2020 August 17 2023 No
Co. Ltd. General
Manager
Jiang Long Goertek Microelectronics Inc. Chairman October 20 2020 October 30 2023 No
Qingdao Goertek Intelligent Sensor Executive
Jiang Long October 22 2021 October 21 2024 No
Co. Ltd. Director
Weifang Goertek Microelectronics Executive
Jiang Long December 9 2019 December 8 2022 No
Co. Ltd. Director
Shanghai Ganyuzhi Technology Executive
Jiang Long October 14 2020 October 13 2023 No
Co. Ltd. Director
Beijing Goertek Microelectronics Executive
Jiang Long August 7 2020 August 6 2023 No
Co. Ltd. Director
Wuxi Goertek Microelectronics Co. Executive
Jiang Long August 7 2020 August 6 2023 No
Ltd. Director
Shenzhen Goertek Microelectronics Executive
Jiang Long July 23 2020 July 22 2023 No
Co. Ltd. Director
Rongcheng Goertek Executive
Jiang Long November 1 2021 October 31 2024 No
Microelectronics Co. Ltd. Director
Qingdao Goertek Microelectronics Executive
Jiang Long November 30 2020 November 29 2023 No
Research Institute Co. Ltd. Director
Jiang Long Enkris Semiconductor Inc. Director November 18 2021 November 17 2024 No
Goertek Technology Vina Company
Duan Huilu Director January 31 2019 December 31 2021 No
Limited
Duan Huilu Goertek Technology Co. Ltd. Supervisor August 14 2021 August 13 2024 No
Executive
Director /
Duan Huilu Goertek Investment Co. Ltd. December 7 2015 December 6 2022 No
General
Manager
Weifang Goertek Electronics Co.Duan Huilu Director November 23 2021 November 22 2024 No
Ltd.Executive
Director /
Duan Huilu Weifang Goertek Trading Co. Ltd. August 26 2020 August 25 2023 No
General
Manager
Beijing Goertek Investment
Duan Huilu Supervisor January 22 2019 January 21 2022 No
Management Co. Ltd.
61Goertek Inc. Annual Report 2021
Duan Huilu Goertek (HongKong) Co. Limited Director April 26 2019 April 25 2022 No
Executive
Qingdao Goertek Commercial Director /
Duan Huilu January 11 2021 January 10 2024 No
Factoring Co. Ltd. General
Manager
Weifang Hanhui Enterprise Executive
Sun Hongbin September 18 2019 September 17 2022 No
Management Co. Ltd. Director
Director /
Weifang Gaoge Education
Sun Hongbin General September 11 2018 February 3 2021 No
Investment Co. Ltd.Manager
Weifang Hanzhi Enterprise Executive
Sun Hongbin October 11 2017 October 10 2023 No
Management Co. Ltd. Director
Weifang Goer Education Investment General
Sun Hongbin March 22 2019 March 21 2022 No
Co. Ltd. Manager
Executive
Director /
Sun Hongbin Weifang Goer Real Estate Co. Ltd August 4 2018 August 3 2024 No
General
Manager
Executive
Director /
Sun Hongbin Qingdao Goer Real Estate Co. Ltd. May 29 2017 May 28 2023 No
General
Manager
General
Sun Hongbin Weifang Goer Farm Co. Ltd. September 23 2017 September 22 2023 No
Manager
Weifang Goer Manor Trading Co. Executive
Sun Hongbin January 27 2018 January 26 2024 No
Ltd. Director
Executive
Weifang Goer Property Service Co. Director /
Sun Hongbin February 23 2018 February 22 2024 No
Ltd General
Manager
Executive
Director /
Sun Hongbin Dotcom Ivestment Co. Ltd June 4 2015 December 24 2021 No
General
Manager
Executive
Weifang GoerHome Decoration Director /
Sun Hongbin April 9 2017 July 14 2021 No
Engineering Co. Ltd General
Manager
Shandong Goer Education Group General
Sun Hongbin January 3 2020 January 2 2023 No
Co. Ltd. Manager
62Goertek Inc. Annual Report 2021
Director /
Beihang Goer (Weifang) Intelligent
Sun Hongbin General January 22 2019 August 31 2021 No
Robot Co. Ltd
Manager
GoerTek Group International Executive
Sun Hongbin August 13 2018 No
Limited Director
Liu Chunfa Goertek Vina Co. Ltd. Director January 1 2019 December 31 2021 No
Goertek Technology Vina Company
Liu Chunfa Director January 31 2019 December 31 2021 No
Limited
Shanghai Goertek Technology Co.Liu Chunfa Supervisor April 25 2020 April 24 2023 No
Ltd.Yili Precision Manufacturing Co. Executive
Jiang Hongzhai July 5 2019 July 4 2022 No
Ltd. Director
Weifang Goertek Communication Executive
Jiang Hongzhai June 26 2021 June 25 2024 No
Technology Co. Ltd. Director
Dongguan JoyForce Precision Executive
Jiang Hongzhai December 11 2019 December 10 2022 No
Manufacturing Co. Ltd. Director
Kunshan Goertek Electronics Co. Executive
Jiang Hongzhai November 9 2020 November 8 2023 No
Ltd. Director
Nanning Goertek Electronics Co.Jiang Hongzhai Chairman November 12 2021 November 11 2024 No
Ltd.Jiang Hongzhai Nanning Goertek Trading Co. Ltd. Chairman November 29 2021 November 28 2024 No
Executive
Beijing Goertek Technology Co. Director /
Yu Dachao November 30 2019 November 29 2022 No
Ltd. General
Manager
Xian Goertek Electronic Executive
Yu Dachao May 7 2019 May 6 2022 No
Technology Co. Ltd. Director
Executive
Qingdao Goertek Acoustics Director /
Yu Dachao December 10 2021 December 9 2024 No
Technology Co. Ltd. General
Manager
Chairman /
Yishui TECO Electronic
Yu Dachao General December 10 2019 December 9 2022 No
Technology Co. Ltd.Manager
Goertek Technology Vina Company
Yu Dachao Director January 31 2021 January 30 2024 No
Limited
Executive
Gao Xiaoguang Yishui Goertek Electronics Co. Ltd. Director / February 13 2021 February 12 2024 No
General
63Goertek Inc. Annual Report 2021
Manager
Executive
Shenzhen Goertek Technology Co. Director /
Gao Xiaoguang October 29 2021 October 28 2024 No
Ltd. General
Manager
Shanghai Goertek Technology Co. Executive
Gao Xiaoguang April 25 2020 April 24 2023 No
Ltd. Director
Gao Xiaoguang Goertek Electronics Inc. Manager December 19 2018 December 18 2021 No
Non-executi
Gao Xiaoguang AKM Industrial Company Limited March 12 2015 No
ve director
Jia Jun'an Goertek Investment Co. Ltd. Supervisor December 7 2021 December 6 2024 No
Weifang Goertek Electronics Co.Jia Jun'an Supervisor November 26 2019 November 25 2022 No
Ltd.Non-executi
Jia Jun'an AKM Industrial Company Limited November 17 2015 No
ve director
Goertek Optical Technology Co.Li Yongzhi Supervisor March 23 2021 March 22 2024 No
Ltd.Goertek Intelligence Technology
Li Yongzhi Supervisor August 18 2020 August 17 2023 No
Co. Ltd.Kunshan Goertek Electronics Co.Li Yongzhi Supervisor November 9 2020 November 8 2023 No
Ltd.Qingdao Goertek Commercial
Li Yongzhi Supervisor January 11 2021 January 10 2024 No
Factoring Co. Ltd.Nanning Goertek Electronics Co.Li Yongzhi Supervisor November 12 2021 November 11 2024 No
Ltd.Li Yongzhi Nanning Goertek Trading Co. Ltd. Supervisor November 29 2021 November 28 2024 No
Xian Goertek Electronic
Li Yongzhi Supervisor May 7 2019 May 6 2022 No
Technology Co. Ltd.Yishui TECO Electronic
Li Yongzhi Supervisor December 10 2019 December 9 2022 No
Technology Co. Ltd.Rongcheng Goertek Technology
Li Yongzhi Supervisor July 15 2020 July 14 2023 No
Co. Ltd.Goertek Technology Vina Company
Li Yongzhi Supervisor January 31 2019 January 30 2022 No
Limited
Li Yongzhi Goertek Microelectronics Inc. Director December 23 2020 December 22 2023 No
Kazuyoshi Goertek Vina Co. Ltd General December 20 2021
No
Yoshinaga Manager
Kazuyoshi Goertek Technology Vina Company General September 1 2021 No
64Goertek Inc. Annual Report 2021
Yoshinaga Limited Manager
Kazuyoshi Goertek Precision Industry Vietnam General September 1 2021
No
Yoshinaga Company Limited Manager
Shanghai Goertek Technology Co. General
Li Youbo July 23 2020 July 22 2023 No
Ltd. Manager
Nanning Goertek Electronics Co.Zhu Shengbo Director November 12 2021 November 11 2024 No
Ltd.Zhu Shengbo Nanning Goertek Trading Co. Ltd. Director November 29 2021 November 28 2024 No
Zhu Shengbo Goertek Vina Co. Ltd Chairman January 1 2019 December 31 2021 No
Zhu Shengbo Goertek Technology Vina Company Director
January 31 2019 January 30 2022 No
Limited
Zhu Shengbo Goertek Precision Industry Vietnam Executive October 30 2020 October 29 2025
No
Company Limited Director
Zhu Shengbo Goertek Technology (Hong Executive August 7 2020
No
Kong)Co. Ltd. Director
Weifang Goertek Communication General
Wei Wenbin June 26 2021 June 25 2024 No
Technology Co. Ltd. Manager
Description of
incumbency in None
other units
Penalties imposed by securities regulatory authorities on current and outgoing directors supervisors and senior management of the
company in the past three years
□ Applicable √ Not applicable
3. Remuneration of Directors Supervisors and Senior Management
The decision-making procedure basis and actual payment of the remuneration of directors supervisors and senior management
The remuneration plan of directors and supervisors of the company shall be formulated by the remuneration and assessment
committee of the Board of Directors which shall be approved by the Board of Directors and submitted to the general meeting of
shareholders for approval before implementation.The remuneration standard for senior management shall be formulated by the remuneration and assessment committee and
implemented after approval by the Board of Directors. Allowances for independent directors shall be paid on a regular basis.Remuneration of directors supervisors and senior management during reporting period
Unit: RMB 10000
The total amount Whether to get
Appointment of pre-tax paid by the
Name Position Gender Age
status remuneration related party of
received from the the company
65Goertek Inc. Annual Report 2021
company
Jiang Bin Chairman Male 56 Incumbent 180 No
Vice Chairman
Jiang Long Male 48 Incumbent 180 No
President
Xia Shanhong Director Female 64 Incumbent 18 No
Independent
Wang Kun Female 46 Incumbent 18 No
Director
Chairman of
Sun Hongbin Board of Male 56 Incumbent 0 Yes
Supervisors
Employee
Feng Jianliang Representative Male 48 Resigned 15 No
Supervisor
Employee
Xu Xiaofeng representative Female 45 Incumbent 45 No
Supervisor
Director Vice
Duan Huilu Male 46 Incumbent 120 No
President
Gao Xiaoguang Vice President Male 46 Incumbent 120 No
Liu Chunfa Vice President Male 46 Incumbent 120 No
Jiang Hongzhai Vice President Male 52 Incumbent 120 No
Vice President
Jia Jun'an Secretary of the Male 51 Incumbent 120 No
Board
Feng Pengbo Vice President Male 54 Resigned 83 No
Yu Dachao Vice President Male 44 Incumbent 120 No
Kazuyoshi
Vice President Male 55 Incumbent 120 No
Yoshinaga
Liu Chengmin Director Male 51 Incumbent 18 No
Independent
Wang Tianmiao Male 62 Incumbent 18 No
Director
Chief Financial
Li Yongzhi Male 44 Incumbent 110 No
Officer
Employee
Wei Wenbin representative Male 44 Incumbent 30 No
Supervisor
Li Youbo Vice President Male 45 Incumbent 70 No
Zhu Shengbo Vice President Male 48 Incumbent 70 No
66Goertek Inc. Annual Report 2021
Total -- -- -- -- 1695 --
67Goertek Inc. Annual Report 2021
VI. Performance of Directors' Duties during the Reporting Period
1. Board of Directors
Session Convening date Disclosure date Meeting resolution
The 13th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
January 15 2021 January 16 2021
Board of Directors newspapers on 16 January 2021(Announcement No 2021-002)
The 14th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
January 27 2021 January 28 2021
Board of Directors newspapers on 28 January 2021(Announcement No 2021-012)
The 15th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
January 29 2021 January 30 2021
Board of Directors newspapers on 30 January 2021(Announcement No 2021-018)
The 16th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
February 9 2021 February 10 2021
Board of Directors newspapers on 10 February 2021(Announcement No 2021-031)
The 17th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
March 1 2021 March 2 2021
Board of Directors newspapers on 2 March 2021(Announcement No 2021-044)
The 18th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
March 26 2021 March 27 2021
Board of Directors newspapers on 27 March 2021(Announcement No 2021-050)
The 19th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
April 16 2021 April 17 2021
Board of Directors newspapers on 17 April 2021(Announcement No 2021-068)
The 20th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
April 21 2021 April 22 2021
Board of Directors newspapers on 22 April 2021(Announcement No 2021-074)
The 21st meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
June 2 2021 June 3 2021
Board of Directors newspapers on 3 June 2021(Announcement No 2021-088)
The 22nd meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
August 26 2021 August 27 2021
Board of Directors newspapers on 27 August 2021(Announcement No 2021-100)
The 23rd meeting of the 5thOctober 26 2021 The board approved: Proposal on the examination of "Goertek Quarterly Report in Q3 2021”
Board of Directors
68Goertek Inc. Annual Report 2021
Session Convening date Disclosure date Meeting resolution
The 24th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
November 8 2021 November 9 2021
Board of Directors newspapers on 8 November 2021(Announcement No 2021-116)
The 25th meeting of the 5th Resolutions were disclosed by the Company on Cninfo (www.cninfo.com.cn) and the four designated
November 30 2021 December 1 2021
Board of Directors newspapers on 1 December 2021(Announcement No 2021-127)
69Goertek Inc. Annual Report 2021
2. Directors’ attendance at Board of Directors and general meeting of shareholders
Directors’ attendance at Board of Directors and general meeting of shareholders
Number of
Whether there Attendance of
Attendance
Attendance by Entrusted is absence in the general
required Attendance in Absence
Name Tele-communi presence person for two meeting of
during the person (times) (times)
cation (times) (times) consecutive shareholders
reporting
times (times)
period (times)
Jiang Bin 13 12 1 0 0 No 3
Jiang Long 13 11 2 0 0 No 2
Duan Huilu 13 13 0 0 0 No 3
Xia Shanhong 13 1 12 0 0 No 1
Wang Tianmiao 13 1 12 0 0 No 1
Liu Chengmin 13 1 10 2 0 Yes 2
Wang Kun 13 1 12 0 0 No 3
Statement on failure to attend the Board of Directors for two consecutive times
Due to the Corona Virus Disease director Liu Chengmin was unable to personally attend the 16th meeting of the 5th Board of
Directors and the 17th meeting of the 5th Board of Directors and delegated director Duan Huilu and independent director Wang Kun
to vote respectively.
3. Objections raised by directors to relevant matters of the Company
Whether directors raise any objection to relevant matters of the Company
□ Yes √ No
No objection was raised to relevant matters of the Company during the reporting period.
4. Other details on the performance of duties by directors
Whether proposals made by directors were adopted by the Company
√ Yes □ No
Statement on the adoption or non-adoption of proposals made by the directors
During the reporting period the directors of the Company carried out work in strict accordance with Company Law Securities
Law Corporate Governance of Listed Companies Rules Governing the Listing of Shares on Shenzhen Stock Exchange
Self-Regulatory Directives No.1 for Listed Companies on the Shenzhen Stock Exchange - Normative Operation of Listed Companies
on the Main Board Articles of Association and Rules of Procedure of the Board of Directors. They fulfilled their duty of due
diligence by forming a consensus after full discussion on major governance and business matters of the Company and resolutely
supervising and driving the implementation of the board resolution so as to ensure the decision-making process being scientific
70Goertek Inc. Annual Report 2021
timely and efficient play a positive role in the sustained healthy and stable development of the Company and effectively safeguard
the legitimate rights and interests of the Company and all shareholders.
71Goertek Inc. Annual Report 2021
VII. Performance of Special Committees under the Board of Directors during the Reporting Period
Number Important
Performance Specific
Committee of opinions and
Members Convening date Meeting content of other objections (if
name meetings suggestions
duties any)
held proposed
The audit committee approved: 1.Special Audit Report on the
Deposit and Use of Funds Raised in Q4 2020; 2. Inspection
Report on Related Transactions and Guarantees of the
January 25 2021 Approved
Company in Q4 2020; 3. Internal Audit Work Report of 2020; 4.Internal Audit Work Plan of 2021; 5. Proposal on Nominating
Mr. Du Lanzhen as Head of Internal Audit
The audit committee approved: 1. Proposal on Approving of
Financial Accounts of 2020; 2. Proposal on Approving of
Financial Report and Abstract of 2020; 3. Proposal on
Approving of Self-assessment Report on Internal Control of
March 26 2021 Approved
Wang Kun Jiang Bin Xia 2020; 4. Proposal on the Re-appointment of the Accounting
Audit committee 5
Shanhong Firm; 5. Report on the Audit Work of the Accounting Firm of
2020; 6. Report on the Performance of the Audit Committee of
the Board of Directors in 2020
The audit committee approved: 1. Proposal on Approving of
Quarterly Report of the Company in Q1 2021 and Abstract of
April 21 2021 the Quarterly Report of the Company in Q1 2021; 2. Inspection Approved
Report on Related Transactions and Guarantees in Q1 2021; 3.Internal Audit Work Report in Q1 2021
The audit committee approved: 1.Proposal on approving of
August 26 2021 Interim Report of 2021 and Abstract of Interim Report of 2021; Approved
2. Special Audit Report on the Deposit and Use of Raised Funds
72Goertek Inc. Annual Report 2021
Number Important
Performance Specific
Committee of opinions and
Members Convening date Meeting content of other objections (if
name meetings suggestions
duties any)
held proposed
in the Semiannual Period of 2021; 3. Inspection Report on
Related Transactions and Guarantees of the Company in Q2
2021; 4. Internal Audit Work Report in Q2 2021
The audit committee approved: 1. Proposal on Approving of
Quarterly Report in Q3 2021 and Abstract of Quarterly Report
in Q3 2021; 2. Inspection Report on Related Transactions and
October 26 2021 Approved
Guarantees in Q3 2021; 3. Internal Audit Work Report in Q3
2021; 4. Special Audit Report on the Deposit and Use of Funds
raised in Q3 2021
The remuneration and assessment committee approved:
January 22 2021 Approved
Proposal on the Remuneration of the Chief Financial Officer
The remuneration and assessment committee approved: 1.Proposal on approving of Goertek Home No 5 Employee Stock
Ownership Plan (Draft); 2. Proposal on approving of
Remuneration
Jiang Bin Xia Shanhong Administrative Measures of Goertek Home No 5 ESOP; 3.and assessment 3 April 13 2021 Approved
Wang Tianmiao Proposal on approving of Stock Option Incentive Plan of
committee
Goertek of 2021 (Draft); 4. Proposal on approving of Measures
for the Examination and Administration of the Implementation
of the Goertek Stock Option Incentive Plan of 2021
The remuneration and assessment approved: Proposal on the
May 31 2021 Approved
Remuneration of Vice President
VIII. Performance of the Board of Supervisors
Whether the Board of Supervisors found out any risk of the Company in its supervision activities during the reporting period.
73Goertek Inc. Annual Report 2021
□ Yes √ No
The Board of Supervisors has no objection to the matters supervised during the reporting period.
74Goertek Inc. Annual Report 2021
IX. Personnel of the Company
1. Number of staff specialty composition and educational level
Number of staff of the parent company at the end of the
37319
Reporting Period
Number of Staff of major subsidiaries at the end of the Reporting
58461
Period
Total number of staff at the end of the Reporting Period 95780
Total number of staff who receive remuneration during the
95780
Reporting Period
Number of retired staff the Company and its major subsidiaries
0
are required to compensate
Specialty composition
Category Number
Production staff 69815
Sales staff 670
Technical staff 19753
Financial staff 306
Administrative staff 5236
Total 95780
Educational level
Category Number
PhD 78
Postgraduate 3435
Undergraduate 16170
College degree 18823
Below College degree 57274
Total 95780
2. Remuneration policy
Goertek continued to put emphasis on the attraction motivation and retention of talents implemented competitive incentive
policies on salary and welfare and fulfilled the cultural concept of “we make we share we grow”.Facing COVID-19 and economic challenges the Company still steadily applied employee promotion and salary adjustment plan
to raise the salary level of employees. The Company also implemented special remuneration policies for core positions and talents
75Goertek Inc. Annual Report 2021
that support the development of strategic business so as to effectively attract and retain talents enrich the Company’s talent pool and
improve the quality and quantity of talents. In terms of incentive policy through the issuance of ESOPs and new stock option plans
more and more core employees can share the fruit of company growth. The cohesion of the management team and the key staffs has
been effectively enhanced. In addition to material incentives the Company fully investigated in the demands of employees strived to
build welfare system with its own characteristics made full use of related resources and cared for employees in an all-round way by
providing diversified benefits in children's education house ownership health security and convenient life.
3. Training programmes
In 2021 the Human Resources Management Department followed Goertek's strategy and business development requirements
improved its all-category full-field and whole-process talent training system carried out diversified learning and training activities
strengthened the construction of a learning organization and promoted organizational performance. Along with the business reform
after a year of construction of the training system and intensive cultivation of the project the Company further improved the training
organization operation and management system for all staffs covering cadres technical personnel professionals and new
employees Wing Project of Goertek thus helping the Company to achieve business objectives.In 2022 the Company will focus on building a global training management center and further reforming talent training mode.The Company will increase investment in the strengthening of talents training capacity policy management training development
and resource management and make substantial breakthroughs in teacher recruitment curriculum management organization-related
knowledge management informatization and digitalization of training and so on so as to helping the Company to become a leader in
the construction of leadership college engineering college new employee training college and professional development college.That’s how the Company achieves its cultural concept of “we make we share we grow” and its mission of a better life enriched by
technology.
4. Labor outsourcing
□ Applicable √ Not applicable
X. Profit Distribution and Conversion of Capital Reserves into Share Capital
Formulation execution or adjustment of profit distribution policy especially the cash dividend during the Reporting Period
√ Applicable □ Not applicable
The Company has strictly implemented the Shareholder Return Plan for the Next Three Years (2019-2021) and clarifies the
standard ratio and the decision making procedures of the distribution policy which ensures the continuity and stability of the profit
distribution policy in order to fully protect the legitimate rights and interests of minority investors. In addition the Company has
76Goertek Inc. Annual Report 2021
conducted share repurchase in 2021. In accordance with the requirements of Company Law Rules Governing the Listing of Shares on
Shenzhen Stock Exchange and Implementation Rules of Shenzhen Stock Exchange on the Share Repurchase of Listed Companies: the
shares repurchased can be regarded as the amount of cash dividends and shall be included in the relevant calculation of cash
dividends proportion of the year.Special description of the cash dividend policy
Whether in compliance with provisions in the Articles of Association or requirements of
Yes
the resolution of the extraordinary general meeting of shareholders:
Whether the dividend standard and the proportion are definite and clear: Yes
Whether the related decision-making procedures and mechanisms are complete: Yes
Whether independent directors perform their duties responsibly and play their due roles: Yes
Whether minority shareholders have the opportunity to fully express their opinions and
Yes
demands and their legitimate rights and interests are fully protected:
Whether the conditions and procedures are transparent and comply with regulations The cash dividend policy has not been
while the cash dividend policy is adjusted or changed: adjusted.The profits of Goertek in the Reporting Period and the parent company's profits distributable to shareholders are positive but the
Company did not put forward a proposed plan for cash dividend distribution.□ Applicable √ Not applicable
Profit distribution and conversion of capital reserves into share capital during the reporting period.√ Applicable □ Not applicable
Number of bonus shares per 10 shares 0
Dividend per 10 shares (RMB) (tax inclusive) 2.00
Conversion of capital reserves into share capital per 10
0
shares (shares)
Shares base of the distribution proposal(shares) 3342055585
Cash dividend amount (RMB) (tax inclusive) 668411117.00
Cash dividend amount distributed by other means (such
1999998595.63
as shares repurchase) (RMB)
Total cash dividends (including other means) (RMB) 2668409712.63
Distributable profit (RMB) 15372823358.48
Proportion of total cash dividends (including other
100%
means) in total profit distribution
Cash dividends
If the Company is in developing stage and there are major capital expenditure arrangements the minimum proportion of cash
dividends in profit distribution should reach 20%.Detailed description of the proposal for profit distribution or capitalization from capital reserve funds
According to the standard unqualified opinion audit report issued by ZHONGXI CPAs (Special General Partnership) for Goertek
77Goertek Inc. Annual Report 2021
the parent company reports a net profit of RMB 758580163.40 in 2021 net distributable profit of RMB 10437290148.25 at the
end of 2021 and the balance of capital reserves of RMB 7706634091.21. The net distributable profit in the consolidated balance
sheet is RMB 15372823358.48. The profit distribution in 2021 is as follows: based on the total share capital registered on the
record date of equity distribution minus the repurchased shares in the Company's special repurchase account the Company will
distribute cash dividend of RMB 2.00 (tax inclusive) for per 10 shares to all the shareholders as well as 0 bonus shares (tax
inclusive) and there is no conversion of capital reserves into share capital.XI. Equity Incentive Plan Employee Stock Ownership Plan or Other Employee Incentives
√ Applicable □ Not applicable
1. Equity incentiveStock Option Incentive Plan in 2021(hereinafter referred to as “the Incentive Plan”）：
On April 16 2021 Goertek convened the 19th meeting of the 5th Board of Directors which approved Proposal of 2021 Stock
Option Incentive Plan of Goertek Inc. (Draft) and the Summary Proposal of Rules on the Implementation and Assessment of 2021
Stock Option Incentive Plan and Proposal of Requesting the General Meeting of Shareholders to Authorize the Board of Directors to
Handle Matters Relevant to 2021 Stock Option Incentive Plan. The 14th meeting of the 5th Board of Supervisors approved relevant
proposals reviewed the list of participants awarded for the first time and expressed the review opinions. Independent directors of the
Company expressed their agreed opinions on the Incentive Plan independently.On April 17 2021 Goertek disclosed the List of Participants Awarded for the First Time of the Incentive Plan on the website
http//:www.cninfo.com.cn. The Company publicized the names and positions of these participants from April 20 to April 29 2021.During the publicity period the Supervisors did not receive any objections and no feedback was recorded. On April 30 2021 the
Company disclosed the Result of Review by the Board of Supervisors on the List of Participants Awarded for the First Time of 2021
Share Option Incentive Plan. On May 8 2021 the Company disclosed Self-examination Report on the Trading of Shares by Insiders
of the 2021 Share Option Incentive Plan.On May 7 2021 the proposals mentioned above were approved on the annual general meeting of 2020. The Board of Directors
were authorized to handle relevant matters regarding the Incentive Plan.On June 2 2021 Goertek convened the 21st meeting of the 5th Board of Directors and the 16th meeting of the 5th Board of
Supervisors. Proposal of the Adjustment of Participants Awarded for the First Time of the 2021 Share Option Incentive Plan
Number of Stock Options and Exercise Price and the Proposal of Resolution of Grant Stock Options to the Participants were
approved. The Board of Supervisors expressed the results of review on the list of incentive participant. Independent Directors
expressed their agreed opinions on relevant matters independently. Beijing Tian Yuan Law Firm issued the Legal Opinions of Beijing
Tian Yuan Law Firm on Relevant Matters Regarding the Adjustment and First Grant of the 2021 Share Option Incentive Plan.
78Goertek Inc. Annual Report 2021
On June 24 2021 Goertek completed the registration of the 2021 Incentive Plan.Stock options granted to Directors and senior management
□ Applicable √ Not applicable
The Appraisal and incentive mechanism for senior management
The remuneration plan of directors and supervisors of the company shall be formulated by the remuneration and assessment
committee of the Board of Directors which shall be approved by the Board of Directors and submitted to the general meeting of
shareholders for approval before implementation. The remuneration standard for senior management shall be formulated by the
remuneration and assessment committee and implemented after approval by the Board of Directors.
2. Implementation of employee stock ownership plan
√ Applicable □ Not applicable
All valid employee stock ownership plans during the reporting period
Shareholding
Participants Number Total shares held Changes Source of funds
percentage
Goertek Home No. 3 ESOP: part of
Directors Supervisors senior
management key management 1600 1349600 None 0.04% self-raised
personnel and key business
personnel
Goertek Home No. 4 ESOP:
Directors (excluding Independent
Directors) Supervisors senior
4000 20539684 None 0.60% n.a.
management key management
personnel and key business
personnel
Goertek Home No. 5 ESOP:
Directors (excluding Independent
Directors) Supervisors senior
25 11000000 None 0.32% self-raised
management key management
personnel and key business
personnel
Total shares held of Directors Supervisors and senior management in ESOPs during the reporting period
Number of shares held at
Number of shares held the end of the reporting
Shareholding
Name Position at the beginning of the period
percentage
reporting period at the beginning of the
reporting period
Duan Huilu Feng Jianliang Directors 8036551 3289000 0.10%
79Goertek Inc. Annual Report 2021
Xu Xiaofeng Wei Wenbin Supervisors senior
Gao Xiaoguang Liu Chunfa management
Jiang Hongzhai Jia Jun’an
Feng Pengbo Yu Dachao
Yoshinaga Kazuyoshi Li
Yongzhi Li Youbo Zhu
Shengbo
Changes of Asset Management Agency during the reporting period
□ Applicable √ Not applicable
Changes in shareholders' equity caused by shares disposal of the participants and other reasons during the reporting period
√ Applicable □ Not applicable
During the reporting period the Goertek Home No. 3 ESOP and Home No. 4 ESOP after the expiration of the lock-up period
sold part of shares in accordance with relevant regulations. By the end of the reporting period Goertek's Home No. 3 ESOP held
1.3496 million shares shareholding percentage was 0.04% while the Home No. 4 ESOP held 20.5397 million shares shareholding
percentage was 0.60%. The Home No. 5 ESOP held 11 million shares shareholding percentage was 0.32%.Exercise of shareholders' rights during the reporting period
During the reporting period the ESOPs exercised the shareholders' rights to participate in cash dividend of 2020 but did not
participate in voting of the general meeting of shareholders or exercise other shareholders' rights.Other relevant situations and descriptions related to ESOPs during the reporting period
□ Applicable √ Not applicable
Changes in members of the Management Committee of the ESOPs
□ Applicable √ Not applicable
Financial impacts of the ESOPs during the reporting period and relevant accounting treatment
√ Applicable □ Not applicable
In accordance with the Accounting Standard for Business Enterprises No.11 - Share-based Payments: if an equity-settled
share-based payment in exchange for services received from employees could not exercise until the completion of services for a
vesting period or until the achievement of a specified performance condition Goertek at each balance sheet date during the vesting
period recognizes the services received for the current period as related costs or expenses and capital reserve at amount equal to the
fair value of the equity instruments at the grant date based on the best estimate of the number of equity instruments expected to
exercise. The expenses amortization of the Goertek Home No. 4 ESOP and the Goertek Home No. 5 ESOP in 2021 is RMB
422.8195 million and RMB 111.0332 million respectively which is recognized as related expenses and capital reserve.
Termination of ESOP during the reporting period
□ Applicable √ Not applicable
Explanation on Other Matters
None
80Goertek Inc. Annual Report 2021
3. Other employee incentive measures
□ Applicable √ Not applicable
XII. Construction and implementation of the Company’s Internal Control System During the
Reporting Period
1. Construction and implementation of internal control
During the reporting period in order to ensure the development of business activities and the realization of Goertek's strategic
goals Goertek attached great importance to the construction of internal control system. We gradually established a basic compliance
sound and effective internal control system covering all aspects of operation and management in accordance with the industry and
asset structure characteristics.
(1) Internal supervision
The Company has established the Internal Audit System and has set up an independent internal audit department which is
responsible for internal audit work the audit and efficiency supervision of financial revenue expenditure the implementation of
financial system the Company’s rules and regulations. The internal audit department also responsible for making proposals on the
improvement of the Company's internal control system.Under the direct leadership of the Audit Committee the audit department independently carries out internal audit and
supervision， supervising the operation and management financial condition and internal control implementation of the Companyand its subsidiaries. Besides the audit department issues independent audit opinions and regularly reports summaries and working
plans to the Audit Committee.
(2) Risk assessment
In combination with characteristics of the industry and actual operating status the Company timely assesses internal and
external risks such as environmental risk business risk and financial risk weighs the risk and return according to the results of risk
analysis and risk tolerance determines strategies and practically makes the risk controllable.
(3) Control activities
The Company constantly implements the workings of internal control in all kinds of business processes conducts various
internal controls avoids the mere formality of internal policies and regulations and improves the effectiveness and soundness of
internal control.
(4) Information disclosure
The Company formulated the Information Disclosure Policy the Accountability System Regarding Major Errors in the Annual
Report Information Disclosure and the Policy on Management of the Personnel with Inside Information. According to the
81Goertek Inc. Annual Report 2021
requirements of relevant laws and regulations the Policy on Management of the Personnel with Inside Information has been revised
in time which has detailed the scope of inside information and related personnel and the administrative measures on registration of
personnel with inside information in material matters. The Company's information disclosure in 2021 complied with the relevant
laws and regulations of the regulatory authorities and the provisions of the above-mentioned control system.
2. Details of material defects of internal control detected during the Reporting Period
□ Yes √ No
XIII. Management and controls of subsidiaries during the Reporting Period
Not applicable
XIV. Self-assessment Report on Internal Control or Audit Report on Internal Control
1. Self-assessment on internal control
Disclosure date of the Internal
March 30 2022
Control Self-assessment Report
Disclosure index of the Internal
Disclosed on www.cninfo.com.cn on March 30 2022
Control Self-assessment Report
Proportion of the total assets of
entities included in the assessment
scope to the total assets of the 100.00%
Company’s consolidated financial
statements
Proportion of the total revenue of
entities included in the assessment
scope to the total revenue of the 100.00%
Company’s consolidated financial
statements
Defect Identification Standard
Category Financial report Non-financial report
The qualitative standard of the
The qualitative standard of the assessment of internal
assessment of internal control defects in
control defects in financial reporting are as follows:
non-financial reporting determined by
Signs of material defects in financial reporting
Goertek are as follows: The
Qualitative criteria include:
identification of defects in non-financial
(1) Fraud of directors supervisors and senior
report is mainly determined by the
management on the financial report;
impact of defects on the effectiveness of
(2) Corrections of previously disclosed financial
business processes and the possibility of
82Goertek Inc. Annual Report 2021
reports; occurrence. If the possibility of defect
(3) Material misstatement of current period financial occurrence is low and the defect will
statements identified by certified public accountant reduce the efficiency and effectiveness
but not identified by the Company’s internal control; of work or increase the uncertainty of
(4) Ineffective supervision on the financial statements the effectiveness or make it deviate
by the audit committee and the internal audit from the expected goal it is a general
department. defect. If the possibility of defect
occurrence is relatively high and the
Signs of important defects in financial reporting
defect will significantly reduce the
include:
efficiency or effectiveness of work or
(1) Failure to select and apply accounting policies in
significantly increase the uncertainty of
accordance with Generally Accepted Accounting
the effectiveness or make it
Principles;
significantly deviate from the expected
(2) No anti-fraud procedures and control measures
goal it is an important defect. If the
have been established;
possibility of defect occurrence is high
(3) No corresponding control mechanism has been and the defect will seriously reduce the
established or implemented for the accounting efficiency or effectiveness of work or
treatment of unconventional or special transactions seriously increase the uncertainty of the
and there is no corresponding compensatory control; effectiveness or make it seriously
(4) One or more defects is or are existing in the deviate from the expected goal it is a
control of the financial reporting process that the material defect
prepared financial statements cannot be reasonably
guaranteed to be true and complete.General defects: other internal control defects.The quantitative standard of the assessment of internal
control defects in financial reporting are as follows:
(1) If one of the following conditions is met it may be
recognized as a material defect:
Item Impact of defects
Potential
≥ 5% with an amount ≥ RMB
misstatement
10 million The quantitative standard of the
of total profit
assessment of internal control defects in
Potential
Quantitative criteria non-financial reporting is in accordance
misstatement
≥ 1% with the quantitative standard of defects
of total
in financial reporting.assets
Potential
misstatement ≥ 1%
of revenue
(2) If one of the following conditions is met it may be
recognized as an important defect:
Item Impact of defects
83Goertek Inc. Annual Report 2021
Potential 3%≤misstatement