B U I L D I N G CREATING GREATER VALUE WITH A GROWING PRESENCE IN CHINA Projects showed from left and top Sanya Hai Tang Bay Land Parcel 9 三亚海棠湾 9 号地块

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1 B U I L D I N G ANNUAL REPORT YANLORD LAND GROUP LIMITED

2 B U I L D I N G CREATING GREATER VALUE WITH A GROWING PRESENCE IN CHINA Projects showed from left and top Sanya Hai Tang Bay Land Parcel 9 三亚海棠湾 9 号地块 Yanlord on the Park, Shanghai 上海仁恒世纪公寓 Suzhou Wuzhong Area C1 Land Villas 苏州昊中区 C1 地块 别墅 Yanlord Marina Centre, Zhuhai 珠海仁恒滨海中心

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4 Led by a dynamic mission and strategic vision, Yanlord sought to pave the way forward and establish our brand in the People s Republic of China (PRC) in the early 1990s. Since then, we have grown from strength to strength, honing our experience and expertise with every project and performance. Over two decades, Yanlord has evolved to become a builder of homes, dreams and icons. Just as China s real estate sector continues to thrive, so have we. Despite operating in a challenging global economy, Yanlord remains resilient to deliver solid results to our stakeholders, buoyed by the healthy recovery in China s real estate market as well as our growing presence in the region. With a track record in developing key properties, our brand name, just like the properties we build, is now an icon in itself. At Yanlord, we are committed to building an iconic brand one that inspires cityscapes and enriches lives. Project showed on this page Yanlord on the Park, Shanghai 上海仁恒世纪公寓

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6 // MISSION STATEMENT // MANAGING WITH BENEVOLENCE AND INTEGRITY, ACHIEVING PERPETUITY THROUGH PERSEVERANCE // ABOUT US // YANLORD DEVELOPS HIGH QUALITY PROPERTIES THAT DISTINGUISH THEMSELVES AMIDST THE LOCALITIES THAT THEY ARE IN. PROPERTIES DEVELOPED BY US ARE CHARACTERISED BY OUTSTANDING ARCHITECTURAL DESIGN AND QUALITY CONSTRUCTION. WITH A TRACK RECORD IN DEVELOPMENTS LOCATED AT PRIME LOCATIONS, OUR BRAND NAME, JUST LIKE THE PROPERTIES WE BUILD, IS AN ICON IN ITSELF.

7 Riverbay Gardens, Suzhou 苏州江湾雅园 CHAIRMAN S STATEMENT 02 OPERATIONS REVIEW 24 FINANCIAL STATEMENTS 53 KEY FIGURES 09 DEVELOPMENT SCHEDULE SUMMARY 36 INTERESTED PERSON TRANSACTIONS 143 OPERATIONAL HIGHLIGHTS 10 BOARD OF DIRECTORS 44 SHAREHOLDING STATISTICS 144 FINANCIAL HIGHLIGHTS 11 KEY MANAGEMENT 49 CORPORATE GOVERNANCE STATEMENT 146 PROJECT SHOWCASE 12 CORPORATE INFORMATION 52 NOTICE OF AGM AND PROXY FORM 161

8 2 YANLORD LAND GROUP LIMITED Dear Shareholders It is with great pleasure that I present to you Yanlord Land Group Limited s ( Yanlord and together with its subsidiaries, the Group ) annual report for the financial year ended 31 December 2016 ( FY 2016 ). FY 2016 was another record year of development for the Group. While global market sentiments remain muted due to a sluggish recovery in economic activity and China s continued economic transformation weighed in on global economic growth, the PRC real estate market nonetheless continued to shine as selling prices and sales volumes in the Tier-1 and -2 cities expanded steadily. CHAIRMAN S STATEMENT Buoyed by the positive market environment in the Group s core markets coupled with our strategic direction to enhance asset churn and attracting greater market support through the high-quality of our developments, pre-sales of properties and car parks rose 15.1% to a record RMB billion in FY 2016 from RMB billion in FY FY 2016 WAS ANOTHER RECORD YEAR OF DEVELOPMENT FOR THE GROUP. BUOYED BY THE POSITIVE MARKET ENVIRONMENT IN THE GROUP S CORE MARKETS COUPLED WITH OUR STRATEGIC DIRECTION TO ENHANCE ASSET CHURN AND ATTRACTING GREATER MARKET SUPPORT THROUGH THE HIGH-QUALITY OF OUR DEVELOPMENTS, PRE-SALES OF PROPERTIES AND CAR PARKS ROSE 15.1% TO A RECORD RMB BILLION IN FY 2016 FROM RMB BILLION IN FY IN-LINE WITH THE STRONG PRE-SALES GROWTH, THE GROUP S REVENUE IN FY 2016 LEAPT 54.8% TO RMB BILLION.

9 3 ANNUAL REPORT 2016 ZHONG SHENG JIAN Chairman and CEO In-line with the strong pre-sales growth, the Group s revenue in FY 2016 leapt 54.8% to RMB billion, while average selling prices ( ASP ) of the Group s pre-sales continued its upward trajectory and extended its consecutive lead with the highest ASP amongst the major listed Chinese developers. As a cornerstone of the PRC economic model, the sustained development of the real estate market is imperative to the success of China s economic transformation. To ensure that the sector develops at a measured pace, the PRC government reinstated several cooling measures in 4Q 2016 to rein in the rapid expansion of asset prices. While these measures may create some near-term volatilities to market demand, we remain confident about the outlook for the PRC real estate sector and I would like to take this opportunity to share my views on the sector as well as the Group s sustainable growth strategy and future development plans. POISED TO CAPTURE MARKET OPPORTUNITY China s market depth and variance within each sub-market makes it difficult to apply a standard product to suit the needs of buyers across the country. To this end, we have actively sought to broaden our product offering through continued research and development. With a comprehensive product portfolio, we applied different approaches to each of our markets and I am happy to report that our developments continue to be well received by our discerning buyers. In addition to receiving a pricing premium to comparable projects within the area, projects such as Yanlord on the Park in Shanghai, Yanlord Yangtze Riverbay Town in Nanjing and Yanlord Marina Centre in Zhuhai are recognized as key landmarks and bellwethers for highquality residential developments within their respective cities. These projects not only enhance the Yanlord brand equity but will also generate greater revenue stream for the Group.

10 4 YANLORD LAND GROUP LIMITED CHAIRMAN S STATEMENT REFLECTING THE INITIAL SUCCESS OF OUR ENDEAVOURS, GROSS PROFIT MARGIN IN FY 2016 ROSE TO 31.2% FROM 27.5% IN FY SUPPORTED BY THE MARGIN EXPANSION AND HIGHER GFA DELIVERED, PROFIT FOR THE YEAR ROSE 67.8% TO RMB3.977 BILLION. CORE PROFIT ATTRIBUTABLE TO OWNERS OF THE COMPANY EXCLUDING THE FAIR VALUE GAIN ON INVESTMENT PROPERTIES AND NET FOREIGN EXCHANGE EFFECT SIMILARLY ROSE 109.3% TO RMB2.292 BILLION IN FY 2016 FROM RMB1.095 BILLION IN FY Leveraging on our strong foundations, we have sought out new cities to expand our market coverage. Nantong, which is a new city for the Group saw a record setting sevenmonth timeline from land acquisition to pre-sales and reflects the scalability of our diverse product portfolio and commitment by our dedicated management team to achieve greater asset turn and flexibility for the Group to adapt to different markets. While we have actively sought out expansion opportunities in FY 2016, we have nonetheless remained mindful of our financial position and overall costs. Leveraging on our stringent cost control measures coupled with easy access to capital markets, we began a series of initiatives in FY 2016 to further enhance profitability. Reflecting the initial success of our endeavours, gross profit margin in FY 2016 rose to 31.2% from 27.5% in FY Supported by the margin expansion and higher gross floor area ( GFA ) delivered, profit for the year rose 67.8% to RMB3.977 billion. Core profit attributable to owners of the Company excluding the fair value gain on investment properties and net foreign exchange effect similarly rose 109.3% to RMB2.292 billion in FY 2016 from RMB1.095 billion in FY LAND BANKING THROUGH COLLABORATIONS AND ACQUISITIONS A developer s ability to grow sustainability lies in the quality of its landbank. In 2016, Chinese cities registered its fourth consecutive year of contraction in new land sales but total transaction values registered another record setting year. What this implies is an increased competition amongst developers for scarce prime quality landbanks. In-line with our strategy to focus on the high-growth cities of the PRC and a commitment to extending our presence within our existing cities, we actively sought out opportunities to expand our landbank in FY In addition to acquiring projects through public land tenders at reasonable cost, we have also sought out other developers with existing prime landbanks as acquisition targets. Riverbay Gardens in Suzhou, Yanlord Centre and Yanlord Landmark in Shenzhen as well as Nanjing Daji Land Parcels were projects whereby we acquired a controlling stake in the developments. Also, we selectively sought out three joint development opportunities in Nanjing and Tianjin by acquiring a shareholding stake in the project companies. As the Chinese real estate market matures, the ability of developers to compete sustainably will extend beyond purely hardware offerings. Leveraging on our brand recognition as a high-quality developer coupled with the pricing premium that our projects enjoy in the PRC, we have attracted numerous notable Chinese state-owned developers such as China Resources Land, Poly Real Estate, China Merchants Property Development and China Ping An Insurance Group as joint development partners. These collaborations not only provide us with additional revenue streams, but also a risk mitigated platform to extend our footprint and gain entry into new cities such as our collaboration into Zhongshan in the Pearl River Delta. In FY 2016, we acquired approximately 2.58 million square metres ( sqm ) of development GFA. With these acquisitions, our total landbank grew from approximately 4.07 million sqm as at 31 December 2015 to 5.93 million sqm as at 31 December 2016.

11 PROPERTY INVESTMENTS Developing a stable recurring revenue stream is a strategic initiative undertaken by the Group to grow a core business segment that incorporates hotels, serviced apartments, commercial and office offerings to complement our revenue from property development. Looking ahead, 2017 is poised to be an exciting year for the Group as we welcome the grand opening of the approximately 42,000 sqm rental GFA office tower of Yanlord Riverside Plaza (Phase 2) in Tianjin and the 408 rooms Crowne Plaza Hotel in Sanya Hai Tang Bay Land Parcel 9, Hainan. Ideally located, the injection of these new projects and maturity of our product offering, I am confident that contribution from this business segment will grow steadily to complement Yanlord s property development business segment and further strengthen our competitive advantage within the industry. Projects showed on right (from top) Yanlord Riverbay, Chengdu 成都仁恒滨河湾 Four Seasons Gardens, Nantong 南通四季花园

12 6 YANLORD LAND GROUP LIMITED CHAIRMAN S STATEMENT OUTLOOK As the world s largest real estate market with annual new home sales reaching over RMB11 trillion in FY 2016, the depth of China s market presents many opportunities and challenges to any developer. While 2016 was largely a year of opportunity for the Group, the fourth quarter saw the reintroduction of various cooling measures in select Tier-1 and -2 cities by the PRC central government to manage household borrowings and to ensure the real estate sector grows at a sustainable pace. While these efforts may generate some near-term volatilities, we remain positive on the outlook of the PRC real estate sector underlined by continued traction in China s urbanisation drive coupled with the wealth creation effect of the country s expanding middle class, which undoubtedly will drive demand for high-quality residential developments. With an illustrious development history, the Company s high-quality developments continue to enjoy significant brand equity in the PRC and stands poised to capture the rising demand for high-quality residential developments. Prime landbank replenishment at reasonable prices will also determine our ability to compete effectively in the PRC real estate sector. Building on our strategy to focus on key high-growth cities, we continue to play an active role in the primary redevelopment market through our showcase Sino-Singapore Nanjing Eco Hi-tech Island a flagship economic collaboration program developed under the auspices of the Singapore Jiangsu Cooperation Council, as well as our Sino-Singapore Haimen Yangtze Nanjing Eco Hi-tech Island 南京生态科技岛 Eco Hi-tech City. We also endeavour to play an active role in enhancing the cityscape of established cities such as our redevelopment projects in the Shenzhen Longgang District and Yanlord Centre in Shenzhen. Through these initiatives, we have established a stable platform to further facilitate our land banking requirements. In addition, we continue to maintain a healthy financial position. With a low net debt to equity gearing ratio of 20.3% and cash and cash equivalent position of RMB billion as at 31 December 2016, we have the resources to opportunistically acquire prime landbanks in the existing cities we operate in. Capitalising on our track record and comparative advantages in the development of quality projects, sizable landbank in prime locations within high growth cities in PRC coupled with our healthy financial position, we are well poised to tap on the long-term growth prospects of the PRC real estate sector to generate greater returns for our stakeholders. IN APPRECIATION On behalf of the Board of Directors, I would like to express our sincere gratitude to our shareholders for their trust and support. In appreciation of our loyal shareholders, the Board of Directors is pleased to propose a higher (up 186.2%) first and final dividend of 4.35 Singapore cents (equivalent to Renminbi cents) per ordinary share for FY 2016 compared to 1.52 Singapore cents for FY Looking ahead, we will continue to build on our proven business strategies and endeavour to increase shareholder value through better operational and financial performance. ZHONG SHENG JIAN Chairman and CEO

13 7 ANNUAL REPORT 2016 进入第四季度, 资产价格的快速上涨令中国中央政府重启调控, 一些热点城市再度出台 限购 限贷 措施, 似乎又印证了中国大陆地产市场的周期规律 尽管市场在短期内可能出现不稳定因素, 但我们仍对长远发展保持乐观 本人在此向各位股东提报集团 2016 年诸项业绩同时, 也将把仁恒的策略思考与各位做一分享 团队实力提升, 更善于把握市场机遇 主席致辞尊敬的各位股东 : 2016 年全球经济发展乏力, 中国经济正经历转型, 但总体平稳, 地产开发继续发挥转型期内 价值之锚 的作用 得益于 2016 年前三季度中国大陆一 二线城市市场延续向上走势, 仁恒团队以高效开发 专业服务, 为消费者提供一流产品, 在 2015 年创下销售业绩新高的基础上,2016 年再度刷新纪录, 合同销售金额达到人民币 亿元, 相比 2015 年之人民币 亿元, 增长 15.1%; 集团 2016 年营业收入为人民币 亿元, 同比增幅达 54.8% 仁恒的销售均价继续在上市房企中位居前列 在 2015 年创下销售业绩新高的基础上, 仁恒集团于 2016 年再度刷新 中国地产市场城市差异明显, 建筑规范与市场偏好不尽相同, 经过连续不断的整合梳理, 仁恒业务已形成丰富的产品线, 能够根据不同城市和区位地块, 合理设计, 高效开发 在成熟地块, 仁恒团队注重产品创新, 在满足城市高端消费人群改善需求同时, 扩大产品溢价收入, 其中上海仁恒世纪公寓 南京仁恒江湾城 珠海仁恒滨海中心等项目均是所在城市的标志性住宅产品, 此类项目除将为集团带来丰厚销售收入, 还进一步提升仁恒的市场影响力 而在新城市 新区域, 仁恒则以标准化设计为基础, 高效组织开发 仁恒南通公司虽是新建团队, 其从拿地到销售仅用 7 个月, 此等高效开发, 完全是标准化程度提高的结果 仁恒开发体系的完善保证了我们能在灵活应对市场变化, 在最大程度上实现经营目标 而在支出方面, 仁恒通过优化融资渠道, 扩大开发, 提升销售的同时, 有效控制了开发成本, 因此 2016 年, 集团获利显著增长, 毛利率在 2015 年 27.5% 的基础上, 继续上涨, 达到 31.2% 全年净利润人民币 亿元, 同比增长近 67.8% 撇除投资性房地产公允值变动盈利及汇兑净影响, 集团 2016 年股东应占核心净利润相比 2015 年之人民币 亿元, 取得突破性增长, 上扬 109.3% 达人民币 亿元 纪录, 合同销售金额达到人民币 亿元, 相比 2015 年之人民币 亿元, 增长 15.1%; 集团 2016 年营业收入为人民币 亿元, 同比增幅达 54.8% 仁恒的销售均价继续在上市房企中位居前列 多元化合作, 增加土地储备 土地关乎地产企业的可持续发展 去年, 中国城市的土地交易面积已是连续第四年下降, 但成交金额却创下历史记录, 土地市场的竞争激烈由此可见 仁恒继续坚持既定的城市发展战略 : 深耕现有城市, 伺机进入有市场潜力的高增长城市

14 8 YANLORD LAND GROUP LIMITED 主席致辞 2016 年, 我们在合适时机通过公开竞买获取了成交溢价相对合理的地块 同时, 由于中国城市中存量土地资源整合加快, 存量土地持有者倾向引入产品溢价能力强的品牌开发企业进行股权合作, 仁恒先后收购了深圳仁恒中心及仁恒置地广场项目和南京大吉别墅项目的多数股权 同时我也以股权合作方式参与开发三个位于南京及天津的项目 2016 年, 集团新增储备了约 258 万平方米的开发面积 与去年同期相比, 仁恒的土地储备从 2015 年 407 万平方米增加至 2016 年的 593 万平方米 2016 年仁恒的扩张具有多重意义, 在城市布局上, 我们进入了珠江三角洲的兴新城市 中山 ; 同时我们还增加了华润置地 保利地产 招商地产以及中国平安保险集团等战略合作伙伴 物业投资 在仁恒目前的商业模式中, 酒店及酒店式公寓 购物商场 写字楼 社区商业街是为集团带来稳定租金收益的物业组合, 除补充集团物业销售收入外, 此类物业投资还是仁恒丰富投资渠道 提升集团品牌 提高业主与客户满意度的重要载体 2017 年, 集团位于天津仁恒海河广场二期的写字楼将投入使用, 租赁面积约 4.2 万平方米 ; 位于三亚海棠湾 -9 号地块的皇冠假日酒店将盛大开业, 集团将增加酒店客房 408 间 这两处优质资产将增加集团的租赁收入 仁恒一贯以稳健的方式发展物业投资, 逐步增持酒店 写字楼 购物商场 社区商铺等长期收益资产, 这一策略不会因为短期收益波动而改变 未来展望 2016 年第四季度, 中国多个城市再度以 限购 限贷 等手段为持续高涨的住宅价格 特别是土地价格降温, 凸显了中国政府忧虑家庭加杠杆购房 地产企业加杠杆购地可能引发金融系统风险 因此从长远来看, 此轮调控将有利于地产市场的长期稳定 反观仁恒, 集团一直保持稳健的财务状况, 截至 2016 年年底, 集团净负债率为 20.3%, 现金储备人民币 亿元, 如有合适机会, 仁恒将继续增持核心城市的开发用地 而在客户端, 仁恒业主以高净值人士为主, 这一群体是中国城市化过程中崛起的中产阶层代表, 他们遵循价值投资, 购房首付比例偏高 稳健审慎的财务策略与忠诚度高的优质客户群是仁恒一直以来的核心竞争力 如今, 中国的房地产市场已是全球第一,2016 年房屋销售已超人民币 11 万亿元 如此庞大的市场, 本身就带有不断更 新 不断改良的发展惯性, 仁恒所参与的深圳龙岗区 - 城中村改造项目及仁恒中心旧改便是城市更新项目的代表, 而类似中新南京生态科技岛 中新海门长江生态科技城等规划新区更是符合中国城市化发展规律的新城建设项目 仁恒已经全方位地参与中国的城市化建设, 我们所走的是品质为先 适度扩张的可持续发展道路 本人一直认为, 唯有品质领先, 才是稳固优质客户资源, 扩大市场影响力的根本 ; 也只有保持在市场优质客户群体以及其他利益相关者之中的信誉, 才能在多变的市场环境下继续发展, 为公司股东创造更大的价值 致谢 本人及仁恒管理团队感谢股东的关心和支持, 为回馈股东, 集团董事局建议每股派发新元 4.35 分 ( 等值人民币 分 ) 首次及末期股息, 较 2015 年所派发的新元 1.52 分, 增幅达 186.2% 未来我们将更加勤勉地工作, 以更好的业绩回报股东 钟声坚集团董事局主席兼总裁 Yanlord Yangtze Riverbay Town, Nanjing 南京仁恒江湾城

15 KEY FIGURES 9 ANNUAL REPORT % INCREASE IN PRE-SALES +54.8% REVENUE IN FY 2016 RMB 8,020m GROSS PROFIT IN FY % GROWTH IN FY 2016 CORE PROFIT 944,834 SQM GFA 20.3% NET DEBT TO EQUITY GEARING RATIO 4.35 DECLARED DIVIDEND $ DELIVERED IN FY 2016

16 10 YANLORD LAND GROUP LIMITED PROPERTY SALES CONTRIBUTION BY CITY IN FY 2016 (%) GFA CONTRIBUTION BY CITY IN FY 2016 (%) n n n n n n n Chengdu Nanjing Shanghai Shenzhen Suzhou Tianjin Zhuhai OPERATIONAL HIGHLIGHTS PROPERTY SALES CONTRIBUTION BY PROJECT IN FY 2016 (%) GFA CONTRIBUTION BY PROJECT IN FY 2016 (%) n Chengdu Yanlord Riverbay (Phase 2) n Nanjing Oasis New Island Gardens (Phase 1) n Nanjing Yanlord Yangtze Riverbay Town n Shanghai Yanlord Eastern Gardens n Shanghai Yanlord Sunland Gardens n Shanghai Yanlord Western Gardens n Suzhou Tang Yue Bay Gardens n Zhuhai Yanlord Marina Peninsula Gardens (Phase 1) n Others

17 REVENUE (RMB MILLION) 25,664 GROSS PROFIT (RMB MILLION) 8,020 10,302 FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY16 FINANCIAL HIGHLIGHTS PROFIT FOR THE YEAR (RMB MILLION) PROFIT ATTRIBUTABLE TO OWNERS OF THE COMPANY (RMB MILLION) 2,452 2,106 2,146 2,370 1,823 1,481 1,372 1,469 11,283 11,736 16,581 3,755 4,004 3,471 4,555 3,977 2,697 FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY16 CREDIT RATIOS (%) As at 31 December Net Debt / Equity (1) Total Debt / Equity (1) Total Debt / Capitalisation (2) (1) Equity = Equity attributable to owners of the Company + Non-controlling interests (2) Capitalisation = Total debt + Equity attributable to owners of the Company + Non-controlling interests

18 12 YANLORD LAND GROUP LIMITED PROJECT SHOWCASE Shanghai YANLORD EASTERN GARDENS 仁恒东邑雅苑 Located within the Tangzhen district of Pudong which has been earmarked for the development of Shanghai s fifth large-scale international residential district. With a planned GFA of approximately 181,000 sqm, the project will offer unparalleled waterfront views coupled with a 25,000 sqm central feature garden and recreational facilities. To better cater to the different lifestyle needs of our customers, the project will offer a comprehensive mix of unit types ranging from 90 to 238 sqm. Following the success of the initial launch of apartment units in FY 2014, the Group secured RMB3.342 billion of pre-sales from Yanlord Eastern Gardens in FY 2016.

19 13 ANNUAL REPORT 2016 Shanghai YANLORD WESTERN GARDENS 仁恒西郊雅苑 Located in Shanghai s traditional upscale residential area of Xujing, the site resides in an area with one of the highest concentration of international schools in Shanghai and is in close proximity to the Hongqiao Transportation Hub. With key infrastructures such as Hongqiao Airport in operation and the new metro lines to be progressively completed, the site will benefit from the excellent connectivity to become a leading international community in the area. With a site area of approximately 137,000 sqm, the 248,000 sqm GFA development will have a building density of 30% and approximately 40% greenery coverage.

20 14 YANLORD LAND GROUP LIMITED Shanghai YANLORD ON THE PARK 仁恒世纪公寓 (top photo) Ideally situated in close proximity to the Lujiazui Financial District within the key residential area of the Shanghai Century Park International Community District, Yanlord on the Park has a GFA of approximately 148,000 sqm and is bordered by the city s arterial thoroughfares such as Jin Kang Road, Pujian Road and the Yanggao South Road. Encapsulating the best of city centre living with a comprehensive suite of amenities such as the lush natural surroundings of the million square metre Century Park, the Shanghai Oriental Arts Centre and the Shanghai Science and Technology Museum. The project will capitalise on the continued eastward expansion of the Lujiazui Financial District and offers our discerning residents with homes that will meet both the requirements of their busy business schedules as well as their recreational needs. On 8 November 2015, the Group launched the inaugural batch of apartments at Yanlord On the Park. Building on the strong momentum following its inaugural launch in FY 2015, the Group secured RMB4.453 billion of pre-sales from Yanlord on the Park in FY PROJECT SHOWCASE

21 15 ANNUAL REPORT 2016 Zhuhai YANLORD MARINA CENTRE 仁恒滨海中心 (bottom photo) Yanlord Marina Centre, located along Qinglu Road (South) near the sea coast, is to be developed into a landmark of Zhuhai City. Lying adjacent to Gongbei Customs Checkpoint to Macau, the project will enjoy easy access to the entrance of the planned Hong Kong- Zhuhai-Macau Bridge as well as the transport interchange of the light rail connecting Zhuhai and Guangzhou. Yanlord Marina Centre, upon completion, will be a showcase development of Zhuhai City. The total GFA of Yanlord Marina Centre will be approximately 222,000 sqm. Construction commenced in The project comprises a 5-star hotel, high-grade residences, offices and retail shops. The Group signed a management contract with the InterContinental Group to manage the hotel in The sea-view hotel, residential apartments, offices and the shopping arcades are slated to be key highlights of Zhuhai s future skyline.

22 16 YANLORD LAND GROUP LIMITED Nanjing OASIS NEW ISLAND GARDENDS 绿洲新岛花园 (top photos) Ideally situated within the Sino-Singapore Nanjing Eco Hi-tech Island a flagship economic collaboration program developed under the auspices of the Singapore Jiangsu Cooperation Council Oasis New Island Gardens rests along the island s idyllic riverfront offering an unobstructed view of the Yangtze River and is in close proximity to the New One North Science Park. Well connected via planned key thoroughfares running through the island as well as the adjacent metro station of the No. 10 metro line, the approximately 390,000 sqm GFA mixed use development will not only feature prime residential offerings but also provide a comprehensive suite of serviced apartments, offices and retail amenities to meet the needs of its residents. PROJECT SHOWCASE

23 17 ANNUAL REPORT 2016 Nanjing YANLORD YANGTZE RIVERBAY TOWN 仁恒江湾城 (bottom photo) Located along the Yangtze River in Hexi New Area, Nanjing, Yanlord Yangtze Riverbay Town occupies a land area of approximately 303,000 sqm, which will be developed into a total GFA of approximately 717,000 sqm. The project is divided into five phases of which the first to third phases and the first batch of fourth phase have been delivered. In November 2016, the Group launched the final batch of apartments at Yanlord Yangtze Riverbay Town (Phase 4). Opening to stellar support from home buyers, Yanlord sold all of the 214 apartment units launched on the opening day, garnering approximately RMB2.132 billion of pre-sales.

24 18 YANLORD LAND GROUP LIMITED PROJECT SHOWCASE Shenzhen YANLORD ROSEMITE 仁恒峦山美地花园 Yanlord Rosemite is the Group s maiden venture into the vibrant city of Shenzhen. Ideally situated along the crossing of the Baohe Road and Danhe Road in the Longgang District of Shenzhen, the project enjoys seamless connectivity to Shenzhen s bustling city centre via the city s major thoroughfares. Surrounded by a comprehensive suite of amenities coupled with lush natural surroundings such as the 50 square kilometre Maluan Hill Country Park and key recreational facilities including the Genzon golf club. The project benefits from the Shenzhen Government s initiative to develop the Longgang district into a secondary city centre and prime residential district.

25 Chengdu 19 ANNUAL REPORT 2016 YANLORD LANDMARK 仁恒置地广场 Yanlord Landmark is a key property investment project of Yanlord in Western China. Located at the heart of Chengdu s Central Business District along major arterial roads, the project neighbours top-grade office buildings, 5-star hotels and luxury department stores. It is ideally situated with the Metro line No. 1 and other business resources in close vicinity. Yanlord Landmark has a GFA of approximately 166,000 sqm above ground and incorporates office areas, serviced apartments and a high-end shopping mall offering retail, conference, residence, and other business and recreation facilities. It is positioned to be a top-end property that represents the highest technical and service standards and caters to the needs of MNCs which plan to locate their regional headquarters in Chengdu. Yanlord Landmark is designed by world renowned architectural consultants ensuring that the project excels in all aspects ranging from engineering and landscaping to business operation. Commencing its operations in 2010, Yanlord Landmark continues to contribute to Chengdu s integration into the global business arena and has successfully attracted numerous international MNCs such as Mitsubishi, Novatris and Royal Dutch Shell. Managed by Fraser Hospitality from Singapore, the serviced apartment tower in Yanlord Landmark began its operations in December 2010 and offers premier levels of luxury and comfort that target the demands of high-end business travelers. Yanlord Landmark is also the epitome of the retail market of Chengdu, showcasing the latest fashion from the flagship stores of many international luxury brands including Louis Vuitton, Prada, Ermenegildo Zegna and Miu Miu.

26 20 YANLORD LAND GROUP LIMITED Suzhou RIVERBAY GARDENS 江湾雅园 (top photos) Ideally situated within Suzhou s city s administrative district, the Gusu district, the approximately 298,000 sqm Riverbay Gardens enjoys excellent connectivity via key thoroughfares and is adjacent to stations of the city s metro line route 2 and route 5 which is currently under construction. Future residents of the project will also benefit from the comprehensive and mature suite of lifestyle amenities such as shopping malls, hospitals, libraries and schools available to cater to their lifestyle needs. Acquired in 2016, Yanlord successfully launched the inaugural batch of apartment units at Riverbay Gardens to strong customer support. Over 94% or 248 of the 265 units launched were sold on the opening day in September 2016 garnering pre-sales of approximately RMB1.264 billion. PROJECT SHOWCASE

27 21 ANNUAL REPORT 2016 Suzhou YANLORD LAKEVIEW BAY 仁恒双湖湾 (bottom photo) Located within the Suzhou Industrial Park, Yanlord Lakeview Bay is located between the scenic Jinji Lake and Dushu Lake. With enchanting natural surroundings and picturesque water features, the approximately 389,000 sqm GFA Yanlord Lakeview Bay is the first residential project in Suzhou designed in accordance with the 3A standards of the national Housing and Urban & Rural Development Ministry and will be developed into a prime international community that comprises townhouses, fully-fitted apartments and commercial facilities to meet the needs of its residents.

28 22 YANLORD LAND GROUP LIMITED Tianjin PROJECT SHOWCASE YANLORD RIVERSIDE GARDENS 仁恒河滨花园 (top photo) Located within the downtown Hebei District of Tianjin, Yanlord Riverside Gardens is situated at the confluence of the Xinkai and Ziya Rivers and features an unobstructed river view. With a planned GFA of approximately 326,000 sqm, Yanlord Riverside Gardens benefits from a comprehensive suite of recreational and educational amenities surrounding the development. Amalgamating modern living with the lush natural environment, Yanlord Riverside Gardens environmentally conscious architectural designs have won the approval of the PRC Ministry for Housing and Urban-Rural Development and was awarded the Green Development (Grade III) for its design.

29 23 ANNUAL REPORT 2016 Tianjin TIANJIN HONG QIAO LAND 红咸雅苑 (bottom photo) Ideally situated within Tianjin s education district, Tianjin Hong Qiao land is mixed use site that will include high-end residential and commercial units as well as educational facilities. In addition to excellent connectivity via key thoroughfares and the city s metro line route 1, the site also enjoys a comprehensive suite of lifestyle amenities as well as being in close proximity to one of the Tianjin s focal secondary school ( 天津市重点中学 天津三中 ) to meet the lifestyle needs of residents.

30 24 YANLORD LAND GROUP LIMITED OPERATIONS REVIEW UNDER THE VARYING MARKET ENVIRONMENT, WE ARE PLEASED TO REPORT THAT YANLORD CONTINUED TO DELIVER A STEADFAST PERFORMANCE SPURRED ON BY STRONG BUYER DEMAND FOR ITS HIGH-QUALITY DEVELOPMENTS. FY 2016 was an exciting year for the PRC real estate market. Despite volatility arising from changes in regulatory policies, physical market performance within Tier-1 markets remained strong. Tier-2 markets in the PRC also witnessed a growing divergence in performance with higher growth cities like the ones that Yanlord operates in showing the strongest rises in ASP and sales volumes, while other Tier-2 as well as Tier-3 and -4 cities actively sought to spur demand and reduce inventory levels. Under the varying market environment, we are pleased to report that Yanlord continued to deliver a steadfast performance spurred on by strong buyer demand for its highquality developments. Recognised revenue in FY 2016 registered a stellar 54.8% increase to RMB billion supported by a 60.1% increase in GFA delivered to 944,834 sqm. Extending the strong sales momentum achieved, pre-sales of the Group in FY 2016 similarly rose 15.1% to RMB billion from RMB billion in FY 2015, while accumulated presales pending recognition as at 31 December 2016 stood at RMB billion. Dedicated to delivering high-quality developments as well as impeccable after sales and property management services, the Yanlord brand continues to gain traction as the epitome for development quality in China. Reflecting this brand premium, we continue to see a steady increase in pre-sales ASP in FY 2016 to RMB30,920/sqm from RMB28,672/ sqm in FY 2015; which is also the highest amongst the top 30 listed developers in the PRC. In addition to a steady increase in pricing, we have also continued to expand our margins in FY Gross profit margin in FY 2016 rose to 31.2% from 27.5% in FY Driven by the greater GFA delivered and higher margins of delivered units during the year, gross profit in FY 2016 grew 76.1% to RMB8.020 billion. Inline with the above performance, profit for the year rose 67.8% to RMB3.977 billion, while profit attributable to owners of the Company similarly rose 83.7% to RMB2.697 billion in FY 2016 from RMB1.469 billion in FY 2015.

31 25 ANNUAL REPORT % RMB BILLION REVENUE IN FY % 944,834 SQM GFA DELIVERED IN FY 2016 Excluding the fair value gain on investment properties and net foreign exchange effect, profit attributable to owners of the Company for FY 2016 leapt 109.3% to RMB2.292 billion from RMB1.095 billion in FY Fully diluted earnings per share in FY 2016 rose 83.9% to Renminbi cents. Looking ahead, we remain confident about the financial performance of the Group in FY 2017 driven by continued sales of our developments and larger proportion of pre-sales recognition. PROJECT DEVELOPMENT Pace of development was steady as at 31 December 2016 with 26 projects and total GFA under construction increased to 3.22 million sqm as at 31 December 2016 from 2.42 million sqm as at 31 December In FY 2016, the Group initiated construction works across 5 projects namely, Four Seasons Gardens (Phase 1 and 2) in Nantong, Riverbay Gardens in Suzhou, Tianjin Hong Qiao Land (Phase 1) in Tianjin and Yanlord Marina Peninsula Gardens (Phase 3) in Zhuhai. A total of 8 new projects were launched in FY 2016, adding significantly to residential resources available for sale. Located in prime areas of their respective cities, the launches of these projects namely, Four Seasons Gardens (Phase 1 and 2) in Nantong, Sanya Hai Tang Bay - Land Parcel 9, Riverbay Gardens in Suzhou, Tianjin Hong Qiao Land (Phase 1), Tianjin Jinnan Land (Phase 3) as well as Yanlord Marina Peninsula Gardens (Phase 1 - Section B and Phase 2) in Zhuhai, were new additions to the Group for pre-sales in FY Riverbay Gardens, Suzhou 苏州江湾雅园

32 26 YANLORD LAND GROUP LIMITED OPERATIONS REVIEW 31.2% GROSS PROFIT MARGIN IN FY % RMB8.020 BILLION GROSS PROFIT IN FY 2016 $ In FY 2016, 10 projects were completed with total GFA of 0.99 million sqm namely, Yanlord Riverbay (Phase 2) in Chengdu, Oasis New Island Gardens (Phase 1) and Yanlord Yangtze Riverbay Town (Phase 4) in Nanjing, Yanlord Eastern Gardens in Shanghai, Tang Yue Bay Gardens and Yanlord Lakeview Bay - Land Parcel A3 in Suzhou, Tianjin Jinnan Land (Phase 1 and 2), Yanlord Riverside Plaza (Phase 2) in Tianjin and Yanlord Marina Peninsula Gardens (Phase 1) in Zhuhai. Adhering to our corporate philosophy to develop the land with devotion and building quality accommodations with passion, we continue to strive for excellence in our developments which have won the recognition of both our clients and industry peers. To better enhance and rationalize existing work flows, we engaged various third party quality surveyors and inspectors, and are pleased to report that we have achieved a successful one-time delivery rate of 99.9% in FY Testament to our efforts, we were awarded 1 new national level and 8 new provincial level awards for product and engineering excellence namely, the National level Luban Award for Engineering Excellence was awarded to Yanlord Riverbay (Phase 1) in Chengdu, Provincial level awards for Structural and Engineering Excellence were awarded to Yanlord Riverbay (Phase 2) in Chengdu, Oasis New Island Gardens (Phase 1) in Nanjing, Sanya Hai Tang Bay - Land Parcel 9, Yanlord Eastern Gardens and Yanlord on the Park in Shanghai, Tang Yue Bay Gardens in Suzhou and Yanlord Marina Peninsula Gardens (Phase 1) in Zhuhai. In addition, Yanlord Yangtze Riverbay Town (Phase 3) in Nanjing also received the accolade and award for Demonstrative Development for New Construction Technologies by the Jiangsu provincial government. Yanlord Riverbay, Chengdu 成都仁恒滨河湾

33 27 ANNUAL REPORT 2016 Oasis New Island Gardens, Nanjing 南京绿洲新岛花园 LANDBANK The PRC land market saw exceptionally heated competition amongst developers in FY To better mitigate against rising land prices, we actively sought out alternative opportunities such as collaborations with other reputable developers and acquisition of project companies to better compliment the replenishment our prime quality landbank. In FY 2016, we acquired 12 new projects across our key cities of Nanjing, Shenzhen, Suzhou and Tianjin. Total GFA of these 12 projects was approximately 2.58 million sqm. Through the public land tender market, we successfully acquired four projects with a combined GFA of approximately 909,922 sqm at reasonable costs, namely Nanjing No. 2016G84 Land, Suzhou No WG-46 Land Parcels, Suzhou No WG-63 Land and Yanlord Majestive Mansion in Tianjin for a total consideration paid in FY 2016 of approximately RMB8.833 billion. In addition, we have also sought out other developers with existing prime landbanks as acquisition targets. Riverbay Gardens in Suzhou, Yanlord Centre and Yanlord Landmark in Shenzhen as well as Nanjing Daji Land Parcels were projects whereby we acquired a controlling stake in the development. Also, we entered into collaborative agreements to jointly develop Nanjing No. 2016G01 Land, Tianjin Hong Qiao Land (Phase 1 and 2) and Tianjin No Land Parcels through the acquisition of a shareholding stake in the project company. Total development GFA of these developments is approximately 1.67 million sqm. FY 2016 saw significant commitment by the Group in land replenishment efforts. Total landbank as at 31 December 2016 was approximately 5.93 million sqm. Diversified across the prime areas within the core high-growth cities of China, we are confident that these holdings will form the bedrock to launch our future development and performance. $ +67.8% RMB3.977 BILLION PROFIT FOR THE YEAR +83.7% RMB2.697 BILLION PROFIT ATTRIBUTABLE TO OWNERS OF THE COMPANY

34 28 YANLORD LAND GROUP LIMITED OPERATIONS REVIEW 5.93 MILLION SQM TOTAL LANDBANK AS AT 31 DECEMBER 2016 PROPERTY INVESTMENTS Conceptualized to be a recurring revenue source, our property investments portfolio has expanded over the years into a key business segment for the Group. Revenue contribution from our property investments portfolio in FY 2016 was marginally weaker at RMB363 million owing to softer sentiments in the PRC retail and hospitality segments. During the year, the Group actively sought to streamline leasing processes and strengthen cost controls as well as resource sharing initiatives to better enhance the management and development of the Group s property investments portfolio. Community business centres, a recent addition to our property investments portfolio, continued to see strong market demand. In FY 2016, we mainly added two new community business centres namely Yanlord Sunland Gardens in Shanghai and Yanlord Rosemite in Shenzhen which completed their preliminary leasing and will begin their operations in We also delivered the first batch of office space to tenants at the office tower of Yanlord Riverside Plaza (Phase 2) in Tianjin for renovation works in December As at 31 December 2016, we have approximately 430,000 sqm (not including car parks) of property investments under management. In FY 2016, we acquired a new project with commercial components, namely Suzhou No WG-46 Land Parcels in Suzhou. Ideally situated and well connected through arterial roads and metro networks, this site is expected to contribute significantly to the development of our property investments portfolio in the future. As at 31 December 2016, we had approximately 210,000 sqm (not including car parks) of leasable area currently in various stages of construction. Looking ahead, we will seek to further develop the performance of our property investments through initiatives such as those targeted at enhancing the consumer experience as well as to opportunistically grow our investment portfolio. PROPERTY MANAGEMENT Enhancing our products and services offering were strategic themes for our property management business segment in FY 2016 following the reorganisation of the Group s various property management entities to be under unified control and ownership across eleven cities. As a forerunner in the introduction of international property management concepts to the PRC market, Yanlord has always held a competitive edge in the field. Building on our extensive experience, Yanlord actively sought to enhance our service offerings by streamlining existing processes and encouraging the sharing of best practices between business units across the country to further cement our competitive advantage within the industry. An integral part of the Yanlord experience, our property management services continue to garner strong support and recognition from both customers and our industry peers. With about 4,750 staff and 48 projects under management, our property management business continues to grow from strength to strength. Revenue from property management in FY 2016 was RMB390 million. Reflecting the achievements of our property management business, various local business units were respectively recognised by different authorities. Notable accolades added in FY 2016 include the following: 2016 China s Top 20 Brands for Property Management Shanghai City Property Management Industry AAA Grade Company Shanghai Property Management Excellence Award Shanghai Renowned Enterprise Brand Award

35 29 ANNUAL REPORT 2016 Shanghai Property Management Association - Exemplary Member unit Jiangsu Province Top 50 Property Management Company Award Yanlord Landmark in Chengdu was awarded the Grade A+ office and commercial development by the Chengdu city government Yanlord Rosemite, Shenzhen 深圳仁恒峦山美地花园 Yanlord on the Park, Shanghai 上海仁恒世纪公寓 Looking ahead, our property management business will continue to be a key business segment for the Group. Driven by the commitment to provide a comfortable and endearing living environment for our customers, the Group will seek to continually optimise our property management model through the adoption of the latest technology and quality assurance standards. HUMAN RESOURCE We regard our human resource as one of our most valuable intangible assets and a key contributor to the Group s continued success. In-line with our mission statement of Managing with benevolence and integrity, achieving perpetuity through perseverance, we believe in treating our employees with trust and understanding and respecting them as a partner of the organisation. We aim to create a positive working environment and platform for employees to demonstrate their own individual capabilities, offering opportunities for them to develop their potential and to progress further in their career development, thereby creating a win-win situation for both the Group and our employees.

36 30 YANLORD LAND GROUP LIMITED OPERATIONS REVIEW Yanlord Lakeview Bay Land Parcel A2, Suzhou 苏州仁恒双湖湾,A2 地块 To better support the continued development of the Group, we actively engage educational institutes in search of suitable talent who are identified through a systematic approach and are further groomed to take on managerial roles within our growing organisation. In 2016 we continued to actively enhance competencies and synergies within our existing talent pool as well as strategically introducing external talents to further complement our knowledge base. Looking ahead, we will continue to review and refine processes to enhance performance assessments and to encourage closer collaboration within the Group to cement a stronger foundation on which we can propel the Group to its next level of development. PRODUCT DEVELOPMENT As a leading real-estate developer specialising in the high quality real estate development and property management services, Yanlord attaches great importance towards developing quality residential and commercial real estates and seeks to strike an optimal balance across all aspects of property development, including project planning, architectural design, interior design and landscape design, to ensure that every aspect is amalgamated to maximise the benefit and comfort level for the customers. Balancing form and functionality, we strive continually to develop projects that embody our commitments towards quality and set new benchmarks for the PRC real estate sector. Recognising the need for balance between the requirements of our consumers and environmental preservation, the Group continues to introduce environmental initiatives and seeks to optimise the usage of lands at our developments. While we may continue to expand our product offerings to include not only residential but commercial, hospitality and tourism projects, our commitment to quality and the environment remains unchanged. Collaborating closely with our hotel management partner, the InterContinental Hotels Group, we optimised the designs and layouts of the InterContinental Hotel at Yanlord Marina Centre in Zhuhai as well as the Crowne Plaza Hotel at Sanya Hai Tang Bay Land Parcel 9. We also sought to incorporate Singapore design concepts on Green Space into our mixed development Yanlord Centre in Shenzhen to further reduce our carbon footprint. We also seek to be a driver of change. Our latest integrated project in Suzhou is located on a site that traces its history back to antiquity; keeping with the internet of things, we sought to seamlessly amalgamate the historical appeal of the site with the accessibility of the internet. Building

37 Yanlord International Apartments, Nanjing 南京仁恒国际公寓 on our initiatives, we hope to create greater value for our customers and further enhance our position as a developer of quality in the PRC real estate market. INVESTOR RELATIONS AND CORPORATE SOCIAL RESPONSIBILITY Corporate transparency and timely disclosure of information to shareholders is of key importance to Yanlord. We endeavor to maintain the highest standards of corporate governance and proactively seek to engage the investment community to facilitate the understanding of our Group s business strategies and growth potentials. Quarterly financial reports as well as announcements and press releases pertaining to any material operational updates on the Group are also promptly released on the SGX website, ensuring that investors receive timely and accurate information. To further enhance communication with the investment community, the Group participated in 25 global investor conferences across Singapore, Hong Kong, London, New York and Macau in FY 2016, sharing insights and investment merits in Yanlord with over 1,000 investors and fund managers. In 2016 and early 2017, Yanlord also participated in a series of corporate day initiatives under the auspices of the SGX. Held in Singapore, Hong Kong, Thailand and Malaysia, these conferences were initiatives by the SGX to enhance visibility of locally listed companies and to enhance communication with regional investors. Moving forward, the Group will continue to maintain regular interactions with the investment community and endeavor to deliver high standards in investor relations. In addition to achieving high standards of investor relations, good corporate citizenry is another key focus of the company. Building on our commitment to delivering quality homes to our discerning customers, we continue to focus on environmental conservation through developing eco-friendly developments. Our corporate social responsibilities also extend to student and youth engagement programs such as grants and donations to educational institutes as well as enrichment programs for students. Building on our earlier initiatives to enhance understanding of the Chinese business environment amongst Singapore students, the Group had in FY 2016 welcomed an additional 4 batches comprising over 200 students and staff from Ngee Ann Polytechnic to our residential and commercial developments in Chengdu.

38 32 YANLORD LAND GROUP LIMITED 业绩概要 +54.8% 人民币 亿元 2016 年销售收入 +60.1% 944,834 平方米 2016 年物业总交付面积 2016 年, 中国房地产市场经历了紧 松 更紧的走势 行业总体表现抢眼, 但同时存在一线强, 二线分化加剧, 三四线去库存的不同区域不同城市的格局 在此市场行情下, 仁恒置地集团物业销售全面完成各项指标, 每个城市皆有亮点 2016 年全年已确认销售收入取得 54.8% 的增长达至人民币 亿元 另外,2016 年总交付面积为 944,834 平方米 全年住宅及车位预售金额从 2015 年的人民币 亿元提升 15.1% 至人民币 亿元 截至 2016 年 12 月 31 日, 集团累计预售金额达人民币 亿元, 这些预售合同金额将陆续入帐, 带动集团未来的财务表现 仁恒品牌在市场上进一步扩大, 专业创新的产品设计和人性温馨的小区物业管理水平获得了市场和消费者的双重口碑, 仁恒成熟稳重的经营管理能力赢得到市场持续认可, 产品溢价能力再次加大 仁恒 2016 年预售均价也在购房者的支持下又一次取得突破, 从 2015 年的人民币 28,672 元 / 平方米增加至 2016 年的人民币 30,920 元 / 平方米, 再一次领先中国 TOP 30 开发商 同时集团毛利也持续上扬, 从 2015 年的 27.5% 增加至 31.2% 2016 年毛利也由于较高毛利率项目的交付以及总交付面积的上升同比增长 76.1% 达人民币 亿元 受益与毛利增长, 年内利润也同比取得 67.8% 的增长达人民币 亿元 2016 年股东应占净利润相比 2015 年的人民币 亿元也增长 83.7% 达人民币 亿元 撇除投资性房地产公允值变动盈利及汇兑净影响,2016 年股东应占净利润相比 2015 年的人民币 亿元增长 109.3% 达人民币 亿元 2016 年全面摊薄每股盈利同比增长 83.9% 为人民币 分 纵观仁恒各城市项目, 皆有较大发展, 成绩喜人! 为 2017 年的发展奠定了较好的基础 项目开发 2016 年集团项目开发增长显著, 年末在建项目 26 个, 建筑面积 322 万平方米, 比 2015 年的 242 万平方米有所增加 2016 年有 5 个项目顺利开工, 其中有南通四季花园一期及二期 苏州江湾雅园 天津红咸雅苑一期及珠海仁恒滨海半岛花园三期 销售方面,2016 年新开盘项目 8 个, 包括南通四季花园一期及二期 三亚海棠湾 9 号地块 苏州江湾雅园 天津景新花园三期及红咸雅苑一期, 以及珠海仁恒滨海半岛花园一期 B 标及二期 Tianjin Hong Qiao Land 天津红咸雅苑 竣工项目有 10 个, 建筑面积 99 万平方米, 包括成都仁恒滨河湾二期 南京仁恒绿洲新岛花园一期及江湾城四期 上海东邑雅苑 苏州棠悦湾花园及双湖湾 A3 地块 天津景新花园一期及二期 天津海河广场二期及珠海仁恒滨海半岛花园一期

39 Sanya Hai Tang Bay Land Parcel 9 三亚海棠湾 9 号地块 集团在 2016 年加大了第三方实测实量检测和工程巡检力度, 圆满实现年初目标 另外集中交付期实现了一次顺交率 99.9% 的优异成绩 同时, 各地工程质量评优斩获颇丰, 仁恒荣获 1 个国家级及 8 个省市级殊荣 除成都仁恒滨河湾一期荣获 鲁班奖国家优质工程 外, 成都仁恒滨河湾二期 南京绿洲新岛花园一期 三亚海棠湾 9 号地块 上海东邑雅苑及世纪公寓 苏州棠悦湾花园及珠海仁恒滨海半岛花园一期 7 个项目获评当地 省市级优质结构工程, 南京仁恒江湾城三期还荣获 江苏省建筑业新技术应用示范工程证书 土地储备 2016 年, 房地产市场异常火爆导致土地市场竞争激烈, 集团则通过公开市场招拍挂 股权合作等方式成功获得了 12 个新项目, 总计容建筑面积约 258 万平方米 招拍挂市场上, 集团成功获取了南京 No. 2016G84 地块 苏州 No WG-46 地块 苏州 No WG-63 地块以及天津仁恒海和院, 本年已支付投资金额约人民币 89 亿元, 计容建筑面积约 91 万平方米 在股权合作及收购方面, 集团成功获取了南京大吉别墅项目 南京 No. 2016G01 地块 深圳仁恒中心 深圳仁恒置地广场 苏 州江湾雅园 天津红咸雅苑一 二期, 以及天津 No 地块等项目共计计容建筑面积约 167 万平方米 2016 年是仁恒土储大量入仓的一年, 截止 2016 年底集团土地储备达到 593 万平方米, 新购土地主要分布在南京 深圳 苏州和天津等中国经济发达的核心城市, 将会为未来仁恒的业绩发展奠定基础 物业投资 2016 年国内新增商业地产项目依然众多, 加上电商持续影响零售行业实体店铺的销售表现, 各品牌的门店拓展继续放缓, 商业项目的招商工作依然困难 集团自持投资性房地产业务表现基本稳定, 如成都仁恒置地广场经过努力, 成功与路易威登 以及普拉达等国际奢侈品牌续约 2016 年集团总业物出租营业收入为人民币 3.63 亿元, 投资性房地产面积约 43 万平方米 ( 不含停车库 ), 上海仁恒森兰雅苑 深圳仁恒峦山美地花园两个高端住宅项目配套社区商业均在年底由筹备阶段转入试营运阶段, 天津仁恒海河广场二期写字楼也于 2016 年 12 月份交付于首批租户使用 展望未来, 集团坚定的有节奏发展持有物业,2016 年新增苏州 No WG-46 地块的 1 个优质城市地铁交通节点商业项目的开发规划, 另集团目前规划和建设中商 业项目规模约 21 万平方米可出租面积 ( 不含停车库 ) 2016 年集团在加强商业专业化管理 体系建设方面做了大量基础工作, 以适应未来集团商业的发展需要做好准备 物业管理 2016 年是仁恒物业股权结构开始梳理后的首年运作, 仁恒物业根据集团 适度规模 多元服务 的发展要求, 在各地区公司及集团各部门的积极配合与支持下, 夯实基础 做好各项服务工作, 在继续深化管理的同时, 稳步推进架构梳理 梯队搭建 制度建设 业务提升 企业文化建设 开拓创新等重点工作, 较好地完成了年初预定的各项目标 截止 2016 年底, 仁恒物业旗下在十一个地区设有公司或分公司, 其中一级资质企业三家 二级资质企业三家 在充分把握高端物业业务多元化和差异化的需求下, 仁恒物业优化整合各项资源, 适时成立多家专业化公司, 在会所经营 经纪业务 幼儿早教 特约家居等方面进行尝试, 形成了由基础服务 专业服务和社区多元化服务相结合的物业经营格局, 将物业服务渗透至业户生活 工作等各个方面, 增加了业务对物业的粘度, 为公司创造一定的经济效益, 确保物业管理活动的良性运作

40 34 YANLORD LAND GROUP LIMITED Yanlord Riverbay, Chengdu 成都仁恒滨河湾 经统计, 至 2016 年末, 仁恒物业在管项目 48 个, 物业从业人数达 4,750 人 2016 年全年经营收入逾人民币 3.9 亿元. 仁恒物业始终把满足客户的需求作为工作开展的第一要务, 以匠人精神服务于点滴细微处 根据集团对物业服务持续发展的战略要求, 不断注重企业内部管理和企业外部形象维系, 获得了行业和社会的广泛认可 2016 年各地物业团队获得了以下殊荣 : 2016 中国社区服务商 TOP20 上海市物业管理行业诚信承诺 AAA 级企业 上海市质量管理奖 上海名牌企业 上海市物业管理行业协会优秀会员单位 江苏省物业服务行业综合实力五十强 成都市首批超甲级商务写字楼 等等, 展示了仁恒物业在全国范围内的影响力 2017 年仁恒物业面临更多的机遇和挑战, 整个团队定将上下齐心 携手并进, 以服务为中心, 不断开拓创新, 把仁恒物业品牌推向一个更高的台阶! 人力资源 公司坚持并倡导 仁信治业 持之以恒 的企业精神, 善待土地, 善待员工, 通过良好的职业发展平台和优秀的企业文化吸引和保留人才 仁恒一贯将人才战略列为集团 发展战略的重要组成部分, 集团设有人才培训发展领导小组和人才培训中心, 组织实施 优才计划, 地方公司也根据业务发展需要推动二级人才培养计划 同时, 通过校园招聘对第三梯队人才进行补充, 系统性推动公司人才战略 仁恒视员工为企业的合作伙伴, 信任 理解并善待员工 ; 视人才为企业发展的核心, 注重团队培养, 通过一系列措施有效实现对团队的选 用 育 留, 多年来一直保持员工队伍的相对稳定和不断成长 2016 年, 集团一方面加大内部潜力人才的培养力度, 完成优才专项培养计划, 并辅以外部优秀人才的引进, 以确保足够核心人才配合企业的发展所需 同时, 通过年度目标考核管理及季度销售考核等绩效体系的推进来进行团队业绩评估激励, 结合绩效与发展潜力双维度进行人才盘点, 优胜劣汰, 根据企业经营及长久发展持续优化人才结构, 从而进一步提升企业效率 产品研发 仁恒, 主张善待每一寸土地, 以人为本, 以建筑为载体, 以空间为核心, 优化整合城市 人文 环境 家庭多重生态系统, 在产品设计中将健康生活 和谐邻里 与环境共融等理念不断迭代提升 仁恒建筑研发中心秉持一贯使命感和行业危机感, 讲求 传承经典 突破创新 再造团队, 创造新动力, 寻找新办法 进一 步适应和匹配中国房地产开发新形势下的新要求 通过重点把控前期土地拓展 树立行业标杆项目 突破局限开拓新业务类型 保驾护航重视产品线建设等技术管控手段, 不断持续增强仁恒产品竞争力和行业地位 仁恒将更加重视对前期投资的技术支持, 把握行业大趋势, 精选土地, 优化方案提升土地价值 深度了解客群组成, 明晰精准定位, 保持仁恒一贯调性, 从规划 产品 配套围绕圈层进行产品创新, 有效降低投资风险 在当今低成本高周转的主流发展模式下, 高低配的居住空间布局堆砌遍地丛生, 仁恒独树一帜, 不与众从, 精益求精, 将空间与利益通过设计手法让利于业主 上海仁恒世纪公寓 南京仁恒江湾城等项目总体规划传承经典, 对空间舒适度的持续创新和挖掘 打造社区生活化情境融合 以酒店式入户的舒适体验 便利的迎宾楼配置 运动会所, 不断迭代创新, 坚持回归居住本质理念, 引领住宅市场新生活方向 仁恒新领域探索, 主动积累文旅项目 酒店项目 商业地产 产业地产等设计研发成果及行业标杆信息, 努力发现各类新型业态在定位 规划 技术等方面的内生联系 珠海洲际酒店 ( 位于仁恒滨海中心 ) 及三亚皇冠假日酒店 ( 位于三亚海棠湾 9 号地块 ) 展示了仁恒向高要求 高标准的酒

41 35 ANNUAL REPORT 2016 店设计及管理稳步推进 深圳仁恒中心以生态 低碳 智慧为主导, 通过引入新加坡产业开发规划和绿色空间新理念, 探索突破国内产业地产开发瓶颈, 与国际一流设计团队合作, 实现产业生态圈平衡, 以保证产品品质 仁恒在千年古城区苏州仓街商住项目是苏州未来城市名片级 最具有代表性的文化旅游商业项目, 再造姑苏古城区提升城市知名度, 结合互联网 + 城市战略和未来消费市场费升级, 商业地产研发提升仁恒在商业领域的知名度和品牌力 仁恒在产品线及标准化建设方面持续发力, 进一步完善技术管理机制, 协同制度升级与团队升级, 为仁恒品质保驾护航 以传承优质基因 沉淀技术经验为目标, 不断推进产品线建设与迭代, 保品质 控成本, 聚焦客户需求和企业核心诉求, 提升产品市场竞争力, 实现从 业务支持 到 价值创造 积极转变 投资关系及企业社会责任 集团十分重视企业的透明度及企业管治水平, 并通过与投资市场的主动沟通, 使各方更了解仁恒的业务发展策略及增长潜力 集团注重向投资者提供及时 准确的讯息批露, 并建立了一系列有系统的沟通管道, 向股东 投资者及分析员提供定期及 可靠的讯息 季度业绩报告及各项公告和新闻稿均通过新加坡证券交易所的官方网站公告及仁恒置地集团网站及时发布 2016 年, 仁恒参与了 25 项分别在新加坡, 香港, 伦敦, 纽约及澳门举办的国际投资者论坛会, 与近千名的投资者及基金经理会面并介绍仁恒的运作及投资优点 在 2016 年与 2017 年初, 仁恒也在新加坡交易所的带领下分别参与了在泰国, 香港及马来西亚的新交所企业日, 进一步拉近了仁恒与区内投资者的交流 除了建立良好的投资者沟通渠道, 仁恒也进行了不少社会责任计划, 比如我们已开发和正在开发的一些建筑项目, 就含有大量的绿色建筑计划, 从设计 建设到管理的每个环节, 我们都有较为详细的绿色促进规划 同时, 公司每年也会从事社会捐赠等福利活动及向教育等事业提供了支持 例如在 2016 年里我们配合了义安理工学院的要求在成都的仁恒置地广场及仁恒滨河湾额外接待了 4 批共 200 名到中国考察的学生与导师 +83.7% 人民币 亿元 2016 年股东应占净利润 +83.9% 人民币 分 2016 年全面摊薄每股盈利

42 36 YANLORD LAND GROUP LIMITED DEVELOPMENT SCHEDULE SUMMARY COMPLETED DEVELOPMENT PROPERTIES Project Description Interest Attributable Site Area (sqm) GFA (sqm) Type 226 units 51% 26,473 40,655 S Chengdu 1 Hengye International Plaza (1) 恒业国际广场 (1) 2 Hengye Star Gardens 814 units 51% 23,036 83,943 R,S 恒业星园 3 Yanlord Landmark (1) 425 units (S, H) and 100% 19, ,755 O,S,H 仁恒置地广场 (1) 32-storey (O) 4 Yanlord Riverbay (Phase 1) 526 units 70% 44, ,641 R 仁恒滨河湾, 一期 5 Yanlord Riverbay (Phase 2) 仁恒滨河湾, 二期 1,096 units 70% 37, ,328 R Guiyang 6 Xintian Centre 新天商业中心 7 Yanlord Villas 仁恒别墅 123 units 67% 18,820 14,376 S 92 units 67% 53,541 36,131 R Nanjing 8 Bamboo Gardens 2,770 units 100% 233, ,310 R 翠竹园 9 Oasis New Island Gardens (Phase 1) 868 units 100% 40, ,065 R 绿洲新岛花园, 一期 10 Orchid Mansions (1) 259 units 100% 94,134 69,649 R 玉兰山庄 (1) 11 Plum Mansions, including Lakeside Mansions 1,943 units 100% 113, ,667 R 梅花山庄. 湖畔之星 12 Yanlord G53 Apartments (1) 921 units 60% 46,640 97,728 R,S 仁恒 G53 公寓 (1) 13 Yanlord International Apartments, Tower A (1) 仁恒国际公寓,A 栋 (1) 210 units 100% 3,337 43,567 H

43 37 ANNUAL REPORT 2016 COMPLETED DEVELOPMENT PROPERTIES (CONT D) Project Description Interest Attributable Site Area (sqm) GFA (sqm) Type Nanjing 14 Yanlord International Apartments, Tower B 仁恒国际公寓,B 栋 15 Yanlord Yangtze Riverbay Town (Phase 1 to 4) (1) 仁恒江湾城, 一至四期 (1) 254 units 100% 25,078 67,683 R 3,882 units 60% 290, ,719 R,S Shanghai 16 Bayside Gardens 764 units 51% 117, ,408 R,S 御澜湾苑 17 Yanlord Apartments 95 units 67% 4,146 13,579 R 仁恒公寓 18 Yanlord Eastern Gardens 774 units 100% 73, ,297 R 仁恒东邑雅苑 19 Yanlord Gardens 1,943 units 67% 138, ,360 R 仁恒滨江园 20 Yanlord Plaza 411 units (R) and 67% 10,845 53,049 R,O 仁恒广场 4-storey (O) 21 Yanlord Riverside City (1) 4,216 units (R) and 67% 306, ,417 R,S 仁恒河滨城 (1) 9-storey (S) 22 Yanlord Riverside Gardens 1,663 units 57% 128, ,756 R 仁恒河滨花园 23 Yanlord Sunland Gardens (1) 1,627 units 60% 202, ,038 R,S,H 仁恒森兰雅苑 (1) 24 Yanlord Town 428 units 50% 94,174 75,573 R 仁恒家园 25 Yanlord Townhouse 269 units 100% 54,208 65,572 R 仁恒怡庭 26 Yanlord Western Gardens 776 units 60% 76, ,464 R 仁恒西郊雅苑 27 Yunjie Riverside Gardens 运杰河滨花园 1,712 units 51% 210, ,048 R,S

44 38 YANLORD LAND GROUP LIMITED DEVELOPMENT SCHEDULE SUMMARY COMPLETED DEVELOPMENT PROPERTIES (CONT D) Project Description Interest Attributable Site Area (sqm) GFA (sqm) Type Shenzhen 28 Yanlord Rosemite (1) 1,540 units 100% 46, ,424 R,S 仁恒峦山美地花园 (1) Suzhou 29 Suzhou Wuzhong Area C1 Land - Villas 22 units 100% 57,857 22,614 R 苏州吴中区 C1 地块 - 别墅 30 Tang Yue Bay Gardens 525 units 100% 28,044 62,322 R 棠悦湾花园 31 Yanlord Lakeview Bay - Land Parcel A2 202 units 60% 135,524 88,263 R 仁恒双湖湾,A2 地块 32 Yanlord Lakeview Bay - Land Parcel A3 51 units 60% 17,063 15,065 R 仁恒双湖湾,A3 地块 33 Yanlord Lakeview Bay - Land Parcel A4 206 units 60% 48,779 56,276 R 仁恒双湖湾,A4 地块 34 Yanlord Lakeview Bay - Land Parcel A5 206 units 60% 60,217 61,702 R 仁恒双湖湾,A5 地块 35 Yanlord Lakeview Bay - Land Parcel A6 (1) 539 units 60% 37,257 78,456 R,S 仁恒双湖湾,A6 地块 (1) 36 Yanlord Lakeview Bay - Land Parcel A7 (1) 429 units 60% 34,806 64,602 R,S 仁恒双湖湾,A7 地块 (1) 37 Yanlord Peninsula (Apartment) 704 units 100% 78, ,342 R 星屿仁恒 38 Yanlord Peninsula (Townhouse) 星岛仁恒 350 units 100% 168,000 91,963 R Tangshan 39 Tangshan Nanhu Eco-City - Land Parcel A9 (2) 唐山南湖生态城,A9 地块 (2) 759 units 50% 42, ,116 R,S 40 Tangshan Nanhu Eco-City - Land Parcel A19 (2) 唐山南湖生态城,A19 地块 (2) 116 units 50% 46,199 38,611 R

45 39 ANNUAL REPORT 2016 COMPLETED DEVELOPMENT PROPERTIES (CONT D) Project Description Interest Attributable Site Area (sqm) GFA (sqm) Type 762 units 60% 50,155 94,339 R,S Tianjin 41 Tianjin Jinnan Land (Phase 1) (1) 景新花园, 一期 (1) 42 Tianjin Jinnan Land (Phase 2) 638 units 60% 47,793 75,564 R 景新花园, 二期 43 Yanlord Riverside Gardens 2,184 units 80% 130, ,819 R 仁恒河滨花园 44 Yanlord Riverside Plaza (Phase 1) (1) 仁恒海河广场, 一期 (1) 971 units (R) and 7-storey (S) 100% 43, ,426 R,S 45 Yanlord Riverside Plaza (Phase 2) (1) 仁恒海河广场, 二期 (1) 544 units (R), 29-storey office and retail mall 100% 51, ,971 R,O,S Zhuhai 46 Yanlord Marina Centre - Section B 101 units 95% 7,772 33,170 R 仁恒滨海中心,B 标段 47 Yanlord Marina Peninsula Gardens (Phase 1) (1) 956 units 57% 39, ,925 R,S 仁恒滨海半岛花园, 一期 (1) 48 Yanlord New City Gardens (1) 仁恒星园 (1) 2,697 units 90% 229, ,012 R,S Total 3,890,366 7,456,760 R = Residential O = Office S = Shop & Retail H = Hotel & Serviced Apartment (1) Consists of properties held for investment with unexpired terms of lease between years as at 31 December 2016 (2) Being held under associate or joint venture

46 40 YANLORD LAND GROUP LIMITED DEVELOPMENT SCHEDULE SUMMARY PROPERTIES UNDER DEVELOPMENT Project Description Interest Attributable Actual / Estimated Completion date Site Area (sqm) GFA (sqm) Percentage of Completion Type Chengdu 1 Yanlord Riverbay (Phase 3) 仁恒滨河湾, 三期 654 units 70% 3rd Quarter , ,784 15% R Nanjing 2 Nanjing No. 2016G01 Land (1) 南京 No. 2016G01 地块 (1) 3 Oasis New Island Gardens (Phase 2) 绿洲新岛花园, 二期 4 Oasis New Island Gardens (Phase 3) 绿洲新岛花园, 三期 5 Yanlord Yangtze Riverbay Town - Land Parcel 5 仁恒江湾城 - 5 号地块 861 units (R) coupling with a serviced apartment and retail shops 33% 4th Quarter , ,338 0% R,S,H 718 units 100% Jul ,911 94,025 83% R 662 units 100% Dec ,800 75,518 47% R 41 units 60% Jun ,845 19,338 55% S Nantong 6 Four Seasons Gardens (Phase 1) 四季花园, 一期 7 Four Seasons Gardens (Phase 2) 四季花园, 二期 528 units 60% 2nd Quarter units (R) and 32 units (S) 60% 4th Quarter ,750 64,650 27% R 34,401 72,024 18% R,S Sanya 8 Sanya Hai Tang Bay - Land Parcel 9 (2) 三亚海棠湾 - 9 号地块 (2) 599 units 100% May ,772 75,592 65% R,H

47 41 ANNUAL REPORT 2016 PROPERTIES UNDER DEVELOPMENT (CONT D) Project Description Interest Attributable Actual / Estimated Completion date Site Area (sqm) GFA (sqm) Percentage of Completion Type Shanghai 9 Yanlord Eastern Gardens 仁恒东邑雅苑 10 Yanlord on the Park 仁恒世纪公寓 11 Yanlord Western Gardens 仁恒西郊雅苑 420 units 100% Aug ,166 77,673 99% R 717 units 50% Sep , ,163 67% R 694 units 60% Jan , ,039 99% R Shenzhen 12 Shenzhen Longgang District Redevelopment Project (Phase 1) 深圳龙崗区 - 城中村改造项目, 一期 13 Yanlord Centre 仁恒中心 1,353 units (R) coupling with retail shops Multi-purpose complexs 75% 3rd Quarter % 2nd Quarter , ,810 0% R,S 36, ,280 0% O,S,H Suzhou 14 Riverbay Gardens 江湾雅园 15 Suzhou No WG-46 Land Parcels (3) 苏州 No WG-46 地块 (3) 16 Suzhou No WG-63 Land 苏州 No WG-63 地块 17 Tang Yue Bay Gardens 棠悦湾花园 18 Yanlord Lakeview Bay - Land Parcel A1 仁恒双湖湾,A1 地块 High-rise apartments Villas coupling with commercial facilities High-rise apartments 30% 4th Quarter % 4th Quarter % 4th Quarter , ,972 0% R,S 84,199 75,132 0% R,S 24,938 50,855 0% R 841 units 100% May , ,619 77% R 66 units 60% Apr ,458 24,299 90% R

48 42 YANLORD LAND GROUP LIMITED DEVELOPMENT SCHEDULE SUMMARY PROPERTIES UNDER DEVELOPMENT (CONT D) Project Description Interest Attributable Actual / Estimated Completion date Site Area (sqm) GFA (sqm) Percentage of Completion Type Tianjin 19 Tianjin Hong Qiao Land (Phase 1) (1) 红咸雅苑, 一期 (1) 20 Tianjin Jinnan Land (Phase 3) 景新花园, 三期 21 Yanlord Majestive Mansion 仁恒海和院 1,500 units (R) coupling with retail shops 25% 2nd Quarter , ,878 3% R,S 2,012 units 60% Dec , ,243 64% R 1,644 units 100% 2nd Quarter , ,935 0% R Zhuhai 22 Yanlord Marina Centre - (2) (3) Section A 仁恒滨海中心 - A 标段 (2)(3) 23 Yanlord Marina Centre - Section B (3) 仁恒滨海中心 - B 标段 (3) 24 Yanlord Marina Peninsula Gardens (Phase 1) 仁恒滨海半岛花园, 一期 25 Yanlord Marina Peninsula Gardens (Phase 2) 仁恒滨海半岛花园, 二期 26 Yanlord Marina Peninsula Gardens (Phase 3) 仁恒滨海半岛花园, 三期 464 units 95% 1st Quarter units 95% 2nd Quarter ,482 86,446 41% O,S,H 23, ,214 76% R,S 48 units 57% May ,634 16,393 96% R 1,043 units 57% Dec , ,108 60% R,S 1,470 units 57% 4th Quarter , ,092 6% R Total 1,581,366 3,223,420 R = Residential O = Office S = Shop & Retail H = Hotel & Serviced Apartment (1) Being held under associate or joint venture (2) Consists of GFA of 100,148 sqm under construction-in-progress in property, plant and equipment (3) Consists of properties held for investment with unexpired terms of lease between years as at 31 December 2016

49 43 ANNUAL REPORT 2016 PROPERTIES HELD FOR FUTURE DEVELOPMENT Project Description Interest Attributable Site Area (sqm) GFA (sqm) Type Nanjing 1 Nanjing Daji Land Parcels 南京大吉别墅项目 2 Nanjing Eco Hi-tech Island - Land Parcel G73 南京生态科技岛 - G73 地块 3 Nanjing No. 2016G84 Land 南京 No. 2016G84 地块 Shanghai 4 Shanghai San Jia Gang Land Plot 仁恒滨海度假村 1,600 units 51% 466, ,000 R Multi-purpose complexs Multi-purpose complexs 100% 45, ,653 O,S,H 100% 426, ,000 R,H Villas 67% 71,662 35,831 R Shenzhen 5 Shenzhen Longgang District Economic Residential Housing 深圳龙崗区 - 经济适用房 6 Shenzhen Longgang District Redevelopment Project (Phase 2, 3 & 4) 深圳龙崗区 - 城中村改造项目, 二 三 四期 7 Yanlord Landmark 仁恒置地广场 Under pending 75% 48, ,064 R 3,230 units (R) coupling with retail shops Multi-purpose complexs 75% 87, ,190 R,S 100% 2,513 37,688 R,O,S Tangshan 8 Tangshan Nanhu Eco-City Land Parcels (1) 唐山南湖生态城地块 (1) Residential units coupling with office tower and retail shops 50% 97, ,382 R,O,S Tianjin 9 Tianjin Hong Qiao Land (Phase 2) (1) 红咸雅苑, 二期 (1) 10 Tianjin No Land Parcels (1) 天津 No 地块 (1) Office tower coupling with retail shops 1,072 units (R) coupling with multipurpose complexs 25% 33,713 56,760 O,S 50% 135, ,915 R,S,H Total 1,414,060 1,977,483 R = Residential O = Office S = Shop & Retail H = Hotel & Serviced Apartment (1) Being held under associate or joint venture

50 44 YANLORD LAND GROUP LIMITED BOARD OF DIRECTORS

51 45 ANNUAL REPORT MR. ZHONG SHENG JIAN Chairman and CEO 2 MR. ZHONG SILIANG Executive Director Mr. Zhong Sheng Jian is the founder, Chairman and CEO of Yanlord Land Group Limited and was first appointed to our Board of Directors on February 13, His last re-election as our Director was on April 28, He is the father of Mr. Zhong Ming and uncle of Mr. Zhong Siliang, our Executive Directors. He is responsible for the overall management and strategy development of Yanlord Land Group Limited. Since the 1980s, Mr. Zhong has founded and established a number of businesses in trading, manufacturing and real estate spanning China, Singapore and Hong Kong. He started our property development business in the early 1990s through the setting up of our offices in Shanghai and Nanjing, which are now part of the SGX Mainboard listed Yanlord Land Group Limited. Due to his investments in and contribution to various parts of China, Mr. Zhong has been awarded Honorary Citizenships in Nanjing, Zhuhai, Shanwei and Suzhou in the PRC. In 2005, he was also awarded the White Magnolia Award in Shanghai for his contributions to the Municipal City of Shanghai. Mr. Zhong Siliang is our Executive Director and was first appointed on May 11, His last re-election as our Director was on April 28, He is the nephew of Mr. Zhong Sheng Jian, our Chairman and CEO and cousin of Mr. Zhong Ming, our Executive Director. Since October 2005, he has held the position of Assistant General Manager of our Investments Department and in this capacity, Mr. Zhong Siliang assists in the evaluation of new business developments and conducts feasibility studies on potential property transactions for investments. Mr. Zhong Siliang is responsible for establishing relations with architectural Mr. Zhong is a member of several Singapore-China investment and trade committees, including Singapore-Sichuan Trade and Investment Committee, Singapore-Tianjin Economic & Trade Council, Singapore-Jiangsu Cooperation Council, Singapore-Guangdong Collaboration Council and China-Singapore Business Council. He is also a member of the Tianjin People s Political Consultative Conference Standing Committee, Honorary President of Teochew Poit Ip Huay Kuan, Council Member of the Singapore Chinese Chamber of Commerce & Industry, Director of Business China, Vice-President of the Singapore Federation of Chinese Clan Associations, Director of the Sun Yat Sen Nanyang Memorial Hall, Member of the Board of Trustees of the Chinese Development Assistance Council and Vice Chairman of the Singapore Chinese Cultural Centre. In 2010, Mr. Zhong was named and awarded the Singapore Businessman of the Year In August 2015, Mr. Zhong also received the Public Service Medal (Pingat Bakti Masyarakat), a Singapore National Day Award, by the Singapore Government. firms, real estate consultants and the district and national government officials, for the execution of our investments in the PRC. He also works closely with our Chairman and CEO, Mr. Zhong Sheng Jian, and assists in other group decisions. In addition, Mr. Zhong Siliang assists in the overall management of Yanlord Land (Shenzhen) Co., Ltd. and is also the Deputy Director of our operations in the Group since Mr. Zhong Siliang holds a Master s Degree from the Washington University- Fudan University EMBA programme and a Bachelor s Degree in Business Administration from the University of Portsmouth, England.

52 46 YANLORD LAND GROUP LIMITED BOARD OF DIRECTORS 3 MS. CHAN YIU LING Executive Director 4 MR. ZHONG MING Executive Director 5 MR. RONALD SEAH LIM SIANG Lead Independent Director Ms. Chan Yiu Ling is our Executive Director and was first appointed on May 11, Her last re-election as our Director was on April 28, Since 1999, she has been assisting our Chairman and CEO, Mr. Zhong Sheng Jian, and is responsible for various administrative functions of our Group. Prior to that, she was the Sales Manager of Mr. Zhong Ming is our Executive Director and was first appointed on October 1, He is the son of Mr. Zhong Sheng Jian, our Chairman and CEO and cousin of Mr. Zhong Siliang, our Executive Director. Since 2013, Mr. Zhong Ming has been holding various positions from property management to property development in various subsidiaries of Yanlord Land Group Limited. Mr. Zhong Ming is currently holding positions as director of few subsidiaries of Mr. Ronald Seah Lim Siang is our Lead Independent Director and was first appointed on May 11, His last reelection as our Director was on April 25, Over a 26-year period between 1980 and 2005, he held various senior positions within the AIG Group in Singapore, initially as AIA Singapore s Vice-President and Chief Investment Officer managing the investment portfolio of AIA Singapore and later as Vice-President, Direct Investments of AIG Global Investment Corporation (Singapore) Ltd. Between 2001 and 2005, Mr. Seah was also Chairman of the Board of Directors of AIG Global Investment Corporation (Singapore) Ltd. From 1978 to 1980, Mr. Seah managed the investment portfolio of Post Office Savings Bank as Deputy Head of the Investment and Credit Department. Prior to that, he worked at Singapore Nomura Merchant Bank as an Assistant Manager with responsibilities covering the sale of bonds and securities and offshore (ACU) loan administration Yanlord Industrial Ltd., where she managed its sales and marketing department for close to 10 years. Ms. Chan has approximately eight years of administration experience working as an Administration Executive in various companies before joining us. Ms. Chan graduated with a diploma from the Chinese YMCA Secretarial Course in our Group in Shanghai and Tianjin. In this capacity, he oversees the execution of our Group s strategies at the city level, helping to obtain prime sites in Shanghai and Tianjin, driving forward our Group s development and expansion strategies in China. Mr. Zhong Ming graduated from the University of Melbourne with a Bachelor s Degree in Accounting and Finance. for the bank. Between 2002 and 2003, Mr. Seah served on the panel of experts of the Commercial Affairs Department of Singapore. He served on the Investment Committee of the National Council of Social Service between 1996 and Mr. Seah serves on the boards of other listed companies namely, Global Investments Limited, Telechoice International Limited and PGG Wrightson Limited (listed on the New Zealand Stock Exchange). Mr Seah is also an Independent Director on the boards of M&C REIT Management Limited (as manager of CDL Hospitality Real Estate Investment Trust) and M&C Business Trust Management Limited (as trustee-manager of CDL Hospitality Business Trust). He is currently Chairman of Nucleus Connect Pte. Ltd. and sole proprietor of Softcapital SG, a business consultancy. Mr. Seah graduated with a Bachelor of Arts and Social Sciences (Second Class Upper Honours in Economics) from the then University of Singapore in 1975.

53 47 ANNUAL REPORT MR. NG SER MIANG Independent Director 7 MS. NG SHIN EIN Independent Director Mr. Ng Ser Miang is our Independent Director and was first appointed on May 11, His last re-election as our Director was on April 25, He is an Executive Board Member of the International Olympic Committee (IOC) and the Chairman of the IOC Finance Commission. He is also the Chairman of Rowsley Ltd. Mr. Ng was the Chairman of NTUC Fairprice Co-operative Limited and an Independent Director of Singapore Press Holdings Limited. Mr. Ng is the Chairman of Network China and has served as a member of the Asia Pacific Economic Cooperation (APEC) Business Advisory Committee (ABAC) from 2001 to September He was the Ms. Ng Shin Ein is our Independent Director and was first appointed on May 11, Her last re-election as our Director was on April 28, Ms. Ng Shin Ein is the Managing Partner of Gryphus Capital, a pan-asian private equity investment firm founded by professionals with legal, investment management and operational backgrounds. Ms. Ng also leads a network of investors to take proprietary stakes in companies and co-invests with other family offices and private equity firms. Pursuant to such investments, she engages actively with portfolio companies, focusing on strategic development and innovation. Prior to Gryphus Capital, Ms. Ng spent a number of years at the Singapore Exchange, where she was responsible for developing Singapore s capital market and bringing foreign companies to list in Singapore. Additionally, she was part of the Singapore Exchange s IPO Approval Committee, where she contributed industry perspectives and also acted as a conduit between the marketplace and regulators. Chairman of the Singapore Sports Council from 1991 to Mr. Ng was appointed a Justice of the Peace in September 2005 and was a Nominated Member of Parliament from June 2002 to January In 2010, he was conferred the Meritorious Service Medal (Pingat Jasa Gemilang), a National Day Award, by the Singapore Government in addition to the Public Service Star in He received the Outstanding Chief Executive of the Year Award (Singapore Business Awards) in Mr. Ng graduated with a Bachelor s Degree in Business Administration (Honours) from the then University of Singapore and is also a Fellow of the Chartered Institute of Transport (FCIT). Ms. Ng also sits on the board of NTUC Fairprice and is its youngest ever director. Additionally, she serves on the boards of First Resources Limited and UPP Holdings Limited, companies listed on the mainboard of the Singapore Exchange. Ms. Ng was also an adjunct research fellow at the National University of Singapore, where she focused on her areas of interest, philanthropy and social enterprises. Admitted as an advocate and solicitor of the Singapore Supreme Court, Ms. Ng started her career as a corporate lawyer in Messrs Lee & Lee. Whilst at Messrs Lee & Lee, she advised clients on joint ventures, mergers and acquisitions and fundraising exercises. Ms. Ng holds a Degree in LLB (Honours) from Queen Mary and Westfield College, University of London. Ms. Ng is Singapore s Non Resident Ambassador to Hungary.

54 48 YANLORD LAND GROUP LIMITED BOARD OF DIRECTORS 8 LIEUTENANT- GENERAL (RET) NG JUI PING Independent Director Lieutenant-General (Ret) Ng is our Independent Director and was first appointed on September 20, His last re-election as our Director was on April 28, General Ng has a distinguished 30-year military career culminating in the position of Chief of Defence Force, Singapore, from which he retired in He was also Chief of Army and Chief of Staff (General Staff). He has been conferred the Meritorious Service Medal (Military) and the Public Administration Medal (Gold) (Military), among other national honours, for distinguished service to Singapore. He has also been conferred prestigious awards by regional countries for his contributions. Following his retirement from the Singapore Armed Forces, General Ng took up the entrepreneurial route. He listed the company he co-founded on the SGX-ST in January 2000 and exited via a share sale in late He is currently Chairman of August Asia Consulting Pte. Ltd., a wholly-owned business advisory. He is an Independent Director on the SGX-ST listed boards of Pacific Andes Resources Development Limited and Singapore Shipping Corporation Limited. He is Consultant to Sumitomo Mitsui Banking Corporation, Singapore Branch. General Ng held various positions including Deputy Chairman of the Central Provident Fund Board, Singapore; Director of PSA International Pte Ltd and Chairman of its China and North East Asia Grouping; Director of NTUC Income; Chairman of Singapore Technologies Automotive Ltd and Chartered Industries of Singapore Pte Ltd; Corporate Advisor to Singapore Technologies Pte. Ltd. and Singapore Technologies Engineering Ltd; and Chairman Asia Pacific of AGT International, a global public safety and security corporation. He was Advisor to Aldar, the largest Abu Dhabi property developer, and to Chesterton International Property Consultants Pte. Ltd. General Ng is a Master of Arts (History) from Duke University, USA and a graduate of the Advanced Management Programme, Harvard Business School, USA.

55 KEY MANAGEMENT 49 ANNUAL REPORT 2016 MR. ZHANG HAO NING Executive Vice-President Mr. Zhang Hao Ning has been our Executive Vice-President since May 2012 and is responsible for project development. Prior to that, he was the General Manager of our Nanjing operations since 2005 and was responsible for the overall management of our business in Nanjing. He was our Assistant General Manager of our Nanjing operations between 2000 and 2005, and the Manager of our Nanjing operations department from 1994 to Prior to joining us, he worked as a Cost Engineer in the Architecture Design Institute, Nanjing and Hong Kong Changjiang Pte. Ltd., Nanjing between 1990 and 1994, and was responsible for the management of their engineering budgets and was also involved in the design work of the Architecture Design Institute. Mr. Zhang obtained a Master s Degree in Economics from the Nanjing University in the PRC in He is also a registered Cost Engineer with the Jiangsu Department of Personnel since MR. CHEN PING Executive Vice-President Mr. Chen Ping has been our Executive Vice-President since January 2013 and is responsible for the Group s property management business. Prior to this, Mr. Chen was the General Manager of Shanghai Yanlord Property Management Co., Ltd. between 2004 and January Between 1994 and 2004, Mr. Chen was a Sales Manager of Shanghai Yanlord Property Co., Ltd. Before joining the Group, Mr. Chen was an Engineer of Shanghai Xin Hu Steel Factory. Mr. Chen graduated from Tongji University, Shanghai, majoring in Civil and Industrial Engineering. MR. WANG XI Executive Vice-President Mr. Wang Xi was appointed our Executive Vice-President in November Prior to his appointment, Mr. Wang was the Deputy General Manager of China Merchants Shekou Holdings Co., Ltd., and concurrently held the position of General Manager of its East China operations. Mr Wang also served as the Director of Business Development at China Merchant s Property Development Subsidiary (CMPD) prior to the merger of China Merchants Shekou Group and CMPD. Mr Wang has also held key positions in various companies such as the President of Xing Zhi Ye Real Estate Agency Co., Ltd. in Shenzhen between June 2004 and December 2005 as well as the Director of Marketing and Architectural Design at Shanghai Industrial Investment (Holdings) Co., Ltd. s property development unit and the General Manager of its subsidiary s operations in Zhengzhou from January 2003 to April Mr. Wang graduated from Shenzhen University in 1993 with a Bachelor s Degree in Architecture. He obtained his Master s Degree in Management and Engineering from the South China University of Technology in Mr. Wang is also a Certified Civil Engineer. MR. JIM CHAN CHI WAI Group Financial Controller Mr. Jim Chan Chi Wai has been our Group Financial Controller since He is responsible for our day-today finance and accounting functions and is also involved in the supervision of our finance staff. He has more than 10 years of experience as an auditor and accountant. Prior to joining Yanlord, he was the Financial Controller of Komark Hong Kong Co., Ltd, a subsidiary of KomarkCorp Berhad, a multinational company listed in Malaysia, for approximately two years. He was also a Senior Accountant at Cathay International Limited, a multinational company with investments in the United Kingdom and the PRC from 1997 to 2001 and Senior Audit Accountant at PricewaterhouseCoopers from 1993 to Mr. Chan graduated with a Bachelor of Arts in Accountancy with Second Class Honours, Upper Division, from the City University of Hong Kong in He is a Certified Public Accountant registered with the Hong Kong Institute of Certified Public Accountants and a fellow of the Association of Chartered Certified Accountants, Hong Kong.

56 50 YANLORD LAND GROUP LIMITED KEY MANAGEMENT MR. ZHOU YIQUN General Manager - Shanghai Mr. Zhou Yiqun was appointed the General Manager of our Shanghai operations in December 2015 and is responsible for the overall management of our business in Shanghai. Mr. Zhou has more than 10 years of operation experience in real estate development. Prior to this appointment, Mr. Zhou served as our Group s Investment and Operation Director and the Executive Director of our Shanghai subsidiary. Before joining Yanlord, Mr. Zhou served in various managerial positions of Hong Kong based RK Properties. Mr. Zhou was the General Manager of RK Group s Shanghai subsidiary from 2009 to He was the Executive Deputy General Manager of its Jinan subsidiary from 2007 to Mr. Zhou was with Sunco Group from 2005 to 2007, working as the Assistant to General Manager at its Wuxi subsidiary and Senior Manager of the Sunco s Strategic Development Center. Mr. Zhou graduated from Suzhou University with a Master s degree in Management. He also completed his EMBA program ( ) at Cheung Kong Graduate School of Business. MR. LAM CHING FUNG General Manager Zhuhai Mr. Lam Ching Fung has been the General Manager of our operations in Zhuhai since 2005 and is responsible for the overall management of our business in Zhuhai. He was previously a Director of the Zhuhai Special Economic Zone Longshi Bottle Capping Factory and was also responsible for the overall management of the business. Mr. Lam has completed an executive course in Advanced Business Management conducted by Qinghua University, Zhuhai. MR. ZHOU CHENG General Manager Suzhou Mr. Zhou Cheng is the General Manager of our Suzhou operations and is responsible for the overall management of our business in Suzhou. Mr. Zhou joined Yanlord in April 2000 as a Project Manager in the Group s Nanjing subsidiary and has assumed numerous roles including the Manager of the Engineering Department at our Nanjing subsidiary before assuming the role as the Vice General Manager of our Suzhou subsidiary in Between 1999 and April 2000, Mr. Zhou was the Project Manager and Civil & HVAC Engineer at Pepsi Cola Nanjing. Between 1989 and 1999, Mr. Zhou was Project Manager at Nanjing Steel Group. Mr. Zhou graduated from Xi an University of Architecture and Technology in 1989 with a Degree in Industrial and Civil Engineering. MR. HUANG ZHONG XIN General Manager Chengdu Mr. Huang Zhong Xin has been the General Manager of our Chengdu operations since 2005 and is responsible for the overall management of our operations in Chengdu. Since 2002, he served as the Assistant General Manager and later the General Manager of Yanlord Land (Chengdu) Co., Ltd. He was involved in day to day operations of the company. Mr. Huang has been with Yanlord since He was first involved in the international trading business of Yanlord Holdings until Subsequently, he was the Assistant General Manager of Yanlord Industrial (Shenzhen) Co., Ltd. and was responsible for setting up of industrial centres for two years. From 1994 to 2002, he was the Assistant General Manager at Yanlord Investment (Nanjing) Co., Ltd. and Acting General Manager of Yanlord Property Management Co., Ltd. and was involved in the marketing, project planning and property management functions of these companies. MR. GAO YONGJUN General Manager Nanjing and Sanya Mr. Gao Yongjun was appointed General Manager of our Nanjing operations in May 2012 and has been the General Manager of our Sanya operations since March He is responsible for the overall management of our businesses in Nanjing and Sanya. Mr. Gao joined Yanlord in March 1998 and worked as Project Manager, Director of Engineering Department and Assistant General Manager of our Nanjing subsidiary over the years, taking charge of project development and landscaping. between December 2006 and March 2010, Mr. Gao was the Vice General Manager of our Nanjing subsidiary. Mr. Gao graduated from Yangzhou University in 1993 and majored in Industrial and Civil Engineering.

57 51 ANNUAL REPORT 2016 MR. LIN JUN TENG General Manager Tianjin and Tangshan Mr. Lin Jun Teng was appointed General Manager of our Tianjin and Tangshan operations in March 2017 and had served as the Assistant General Manager of operations in Tianjin from June 2004 to June He is responsible for the overall planning and management of our business in Tianjin. Prior to joining Yanlord, he served as Director and General Manager of Hong Kong Art and Decoration Co., Ltd. between 2001 and Before that, Mr. Lin worked as Director and General Manager at a catering management company in Canada. Mr. Lin graduated in LaSalle College of Montreal Canada in 1993 and majored in hotel management. MR. RUAN XIN KUN General Manager Haimen Mr. Ruan Xin Kun was appointed the General Manager of our Haimen operations in April 2014 and is responsible for the overall management of our business in Haimen. Mr. Ruan was the Assistant General Manager of our Suzhou operations from 2003 to 2014 and was responsible for cost management, finance, sales and business development. Prior to joining Yanlord, Mr. Ruan served as a Department Manager of Chuxiong Renheng Fertilizer Co., Ltd. and Executive Director of Suzhou Renheng QingLing Motor Trading Co., Ltd. MR. ZHONG BAILING General Manager - Zhongshan Mr. Zhong Bailing was appointed the General Manager of our Zhongshan operations from December 2015 and is currently responsible for the management of our business in Zhongshan. Prior to that, he was the General Manager of our Shanghai operations from 2012 to 2015 and was the General Manager of our Shenzhen operations from 2010 to From December 2006 to March 2010, Mr. Zhong Bailing was the Executive Vice General Manager of our Zhuhai subsidiary, taking charge of architectural design, engineering, marketing and property management. Between February 1999 and December 2006, he was a Senior Manager of IPC Corporation Ltd. of Singapore and was responsible for the company s project development and marketing in Zhuhai. From May 1996 to February 1998, he was a Project Manager with Zhuhai International Engineering Consulting Co., Ltd. Mr. Zhong Bailing obtained his Bachelor s and Master s Degrees in Engineering from Tsinghua University in 1993 and 1996 respectively. From February 1998 to March 1999, he was a visiting scholar at Nanyang Technological University in Singapore. He is a member of China Institute of Real Estate Appraisers and Agents.

58 52 YANLORD LAND GROUP LIMITED CORPORATE INFORMATION BOARD OF DIRECTORS Zhong Sheng Jian Chairman and Chief Executive Officer Zhong Siliang Executive Director Chan Yiu Ling Executive Director Zhong Ming Executive Director Ronald Seah Lim Siang Lead Independent Director Ng Ser Miang Independent Director Ng Shin Ein Independent Director Ng Jui Ping Independent Director AUDIT COMMITTEE Ronald Seah Lim Siang, Chairman Ng Shin Ein Ng Jui Ping NOMINATING COMMITTEE Ng Ser Miang, Chairman Ronald Seah Lim Siang Zhong Sheng Jian REMUNERATION COMMITTEE Ng Jui Ping, Chairman Ronald Seah Lim Siang Ng Shin Ein RISK MANAGEMENT COMMITTEE Ng Shin Ein, Chairman Ng Ser Miang Ng Jui Ping Zhong Sheng Jian COMPANY SECRETARY Lim Poh Choo GROUP FINANCIAL CONTROLLER Jim Chan Chi Wai REGISTERED OFFICE 9 Temasek Boulevard #36-02 Suntec Tower Two Singapore Tel: (65) Fax: (65) Registration No.: K WEBSITE AUDITORS Deloitte & Touche LLP 6 Shenton Way, OUE Downtown 2 #33-00 Singapore Partner-in-charge: Tay Hwee Ling (Appointed on October 14, 2013) SHARE REGISTRAR AND TRANSFER OFFICE Boardroom Corporate & Advisory Services Pte. Ltd. 50 Raffles Place Singapore Land Tower #32-01 Singapore (Appointed on March 7, 2006) PRINCIPAL BANKERS China Merchants Bank Bank of Shanghai Co., Ltd. The Hongkong and Shanghai Banking Corporation Limited Hang Seng Bank Limited DBS Bank Limited Standard Chartered Bank Limited Bank of China Co., Ltd. Wing Lung Bank Limited Shanghai Pudong Development Bank Co., Ltd. STOCK EXCHANGE LISTING Singapore Exchange Securities Trading Limited DATE AND COUNTRY OF INCORPORATION February 13, 2006, Singapore

59 FINANCIAL STATEMENTS 53 ANNUAL REPORT 2016 STATEMENTS OF FINANCIAL POSITION 65 DIRECTORS STATEMENT 54 CONSOLIDATED STATEMENT OF PROFIT OR LOSS 67 CONSOLIDATED STATEMENT OF CASH FLOWS 72 INDEPENDENT AUDITOR S REPORT 59 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 68 NOTES TO FINANCIAL STATEMENTS 74 STATEMENTS OF CHANGES IN EQUITY 69

60 54 YANLORD LAND GROUP LIMITED DIRECTORS STATEMENT The directors present their statement together with the audited consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company for the financial year ended December 31, In the opinion of the directors, the consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company as set out on pages 65 to 142 are drawn up so as to give a true and fair view of the financial position of the Group and of the Company as at December 31, 2016, and of the financial performance, changes in equity and cash flows of the Group and changes in equity of the Company for the financial year then ended and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debt when they fall due. 1 DIRECTORS The directors of the Company in office at the date of this statement are: Zhong Sheng Jian Zhong Siliang Chan Yiu Ling Zhong Ming (Appointed on October 1, 2016) Ronald Seah Lim Siang Ng Ser Miang Ng Shin Ein Ng Jui Ping 2 ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS BY MEANS OF THE ACQUISITION OF SHARES AND DEBENTURES Neither at the end of the financial year nor at any time during the financial year did there subsist any arrangement whose object is to enable the directors of the Company to acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.

61 DIRECTORS STATEMENT 55 ANNUAL REPORT DIRECTORS INTERESTS IN SHARES AND DEBENTURES The directors of the Company holding office at the end of the financial year had no interests in the shares in, or debentures of, the Company and related corporations as recorded in the register of directors shareholdings kept by the Company under Section 164 of the Singapore Companies Act ( Act ) except as follows: Holdings Holdings in which registered in the directors are deemed name of directors to have an interest Name of directors and companies At beginning At end At beginning At end in which interests are held of year of year of year of year The Company a) Ordinary shares Zhong Sheng Jian (1) 17,860,200 40,939,700 1,278,390,000 1,278,390,000 Zhong Siliang 320, ,000 Chan Yiu Ling (2) 720, ,000 25,000 25,000 Ronald Seah Lim Siang 20,000 20,000 Ng Ser Miang 705, ,000 Ng Shin Ein 118, ,000 Ng Jui Ping 100, ,000 b) Senior notes due 2017 (S$ 000) Ng Shin Ein 5,000 5,000 (1) Zhong Sheng Jian is deemed to be interested in 1,278,390,000 (2015 : 1,278,390,000) ordinary shares in the Company held by Yanlord Holdings Pte. Ltd. ( YHPL ). YHPL is a company which is owned by Zhong Sheng Jian (95% shareholding interest) and his spouse (5% shareholding interest). (2) 25,000 shares in the Company held by the spouse of Chan Yiu Ling.

62 56 YANLORD LAND GROUP LIMITED DIRECTORS STATEMENT 3 DIRECTORS INTERESTS IN SHARES AND DEBENTURES (Cont d) The directors beneficial interest in other related corporations shares and debentures were as follows: Holdings Holdings in which registered in the directors are deemed name of directors to have an interest Name of directors and companies At beginning At end At beginning At end in which interests are held of year of year of year of year Immediate holding company Yanlord Holdings Pte. Ltd. (Ordinary shares) Zhong Sheng Jian 95,000,000 95,000,000 5,000,000 5,000,000 Subsidiary Yanlord Land (HK) Co., Ltd. Senior notes due 2016 (RMB 000) Ng Shin Ein 2,000 Related corporations (i) Yanlord Capital Pte. Ltd. (Ordinary shares) Zhong Sheng Jian 1 1 (ii) Yanlord Industries Pte. Ltd. (Ordinary shares) Zhong Sheng Jian 1 1 By virtue of Section 7 of the Act, Zhong Sheng Jian is deemed to have an interest in the Company and all the related corporations of the Company. The directors interests in the shares and senior notes of the Company as at January 21, 2017 were the same as at December 31, 2016.

63 DIRECTORS STATEMENT 57 ANNUAL REPORT SHARE OPTIONS Yanlord Land Group Share Option Scheme 2006 ( ESOS 2006 ) The ESOS 2006 provided eligible participants with the opportunity to participate in the equity of the Company and motivated them towards better performance through increased dedication and loyalty. The aggregate number of shares that might be issued or issuable under the plan at any time may not exceed 15% of the then issued share capital. The Remuneration Committee ( RC ) comprises 3 independent directors, and they are Ng Jui Ping, Ronald Seah Lim Siang and Ng Shin Ein. The RC administered the ESOS Options might be granted to employees and directors of the Company or any of the related entities, which included the subsidiaries or any entities in which the Company held a substantial ownership interest, including any such employees or directors who were associates of the controlling shareholder. The controlling shareholder was not eligible to participate in the ESOS In general, the plan administrator determined the exercise price of an option. The exercise price might be a fixed or variable price related to the fair market value of the ordinary shares. The term of each award would be stated in the award agreement. The term of an award would not exceed 10 years from the date of the grant, or five years from the date of grant in the case of options granted to non-executive directors or employees of related entities other than subsidiaries. In general, the plan administrator determined, or the award agreement specified, the vesting schedule. The Board of Directors may at any time amend, suspend or terminate the ESOS Amendments to the plan were subject to shareholder approval to the extent required by law, or stock exchange rules or regulations. Additionally, shareholder approval was specifically required to increase the number of shares available for issuance under the plan or to extend the term of an option beyond 10 years. Unless terminated earlier, the plan would expire and no further awards may be granted after the tenth anniversary of the shareholder s approval of the plan. Accordingly, the scheme lapsed in May During the financial year, no option was granted under the ESOS OPTIONS EXERCISED During the financial year, no share of the Company or any corporation in the Group was allotted and issued by virtue of the exercise of options to take up unissued shares of the Company or any corporation in the Group. 6 UNISSUED SHARES UNDER OPTIONS There was no option granted by the Company or any corporation in the Group to any person to take up unissued shares of the Company or any corporation in the Group as at the end of the financial year.

64 58 YANLORD LAND GROUP LIMITED DIRECTORS STATEMENT 7 AUDIT COMMITTEE At the date of this statement, the Audit Committee comprises the following members: Ronald Seah Lim Siang Ng Jui Ping Ng Shin Ein Chairman and Lead Independent Director Independent Director Independent Director The Audit Committee carried out its functions in accordance with Section 201B(5) of the Act. The Audit Committee has recommended to the directors the nomination of Deloitte & Touche LLP, Singapore for re-appointment as external auditors of the Company at the forthcoming Annual General Meeting of the Company. 8 AUDITORS The auditors, Deloitte & Touche LLP, Singapore, have expressed their willingness to accept re-appointment. ON BEHALF OF THE DIRECTORS Zhong Sheng Jian Chan Yiu Ling March 29, 2017

65 INDEPENDENT AUDITOR S REPORT TO THE MEMBERS OF YANLORD LAND GROUP LIMITED 59 ANNUAL REPORT 2016 REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS Opinion We have audited the accompanying financial statements of Yanlord Land Group Limited (the Company ) and its subsidiaries (the Group ), which comprise the consolidated statement of financial position of the Group and the statement of financial position of the Company as at December 31, 2016, and the consolidated statement of profit or loss, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows of the Group and the statement of changes in equity of the Company for the year then ended, and the notes to the financial statements, including a summary of significant accounting policies, as set out on pages 65 to 142. In our opinion, the accompanying consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Companies Act, Chapter 50 ( the Act ) and Financial Reporting Standards in Singapore ( FRSs ) so as to give a true and fair view of the consolidated financial position of the Group and the financial position of the Company as at December 31, 2016, and of the consolidated financial performance, consolidated changes in equity and consolidated cash flows of the Group and changes in equity of the Company for the year ended on that date. Basis for Opinion We conducted our audit in accordance with Singapore Standards on Auditing ( SSAs ). Our responsibilities under those standards are further described in the Auditors Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Group in accordance with the Accounting and Corporate Regulatory Authority ( ACRA ) Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities ( ACRA Code ) together with the ethical requirements that are relevant to our audit of the financial statements in Singapore, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ACRA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current year. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

66 60 YANLORD LAND GROUP LIMITED INDEPENDENT AUDITOR S REPORT TO THE MEMBERS OF YANLORD LAND GROUP LIMITED Key audit matters How the scope of our audit responded to the key audit matters Assessment of recoverable amounts for properties for development, properties under development for sale and completed properties for sale Properties (consisting of properties for development, properties under development for sale and completed properties for sale) (Note 9) represent a significant proportion of the assets in the Group s statement of financial position. The accounting policies for Properties are set out in Note 2 to the consolidated financial statements. Management s assessment of the recoverable amounts of the Properties is a judgemental process which requires the estimation of the net realisable value, which takes into account the future selling price (net of all estimated selling expenses) and the anticipated costs to completion. The shortfall in the net realisable value over the cost is accounted for as an impairment loss in profit or loss. Management evaluates the recoverable amounts of the Properties by taking into consideration of the development plan, timing of sales, current market prices of the properties involved or of comparable properties and the prevailing property market conditions. Management performs cost studies for each project, taking into account the costs incurred to date, the development status and costs to complete each development project. Inappropriate management estimates made in the impairment assessment would result in a significant impact on the carrying amount of the Properties. Our audit procedures on the assessment of recoverable amounts of the Properties included, among others: We obtained an understanding and tested the design and implementation of the Group s controls by checking approvals over reviewing and updating selling price and cost forecasts, setting budgets and authorising and recording of costs. We discussed with management to understand their basis used in determining whether the Group s Properties are impaired and the amount of impairment to be recorded, if any. We challenged management assumptions relating to the reasonableness of the future sales which included transacted prices of past sales of the properties involved or of comparable properties in similar locations; actual prices achieved post year end of the properties involved where available; and the need to adjust for any of these estimated prices considering the current property market trends. We compared these prices to either externally published benchmarks where appropriate, and also considered whether the expected selling prices are consistent with the current property market trends. On a sampling basis, we agreed land costs to the acquisition of land use right agreements, corroborated projected construction costs to the construction agreements, if available and compared to the construction costs of the Group s other similar projects based on the project plan. We focused our work on development projects with slower than expected sales or with low or negative margins. We compared actual margins achieved to budget, to check the accuracy of the Group s budgeting process. Where there were differences, we corroborated the management s explanations. We evaluated the sensitivity of the margin to a change in sales prices and costs and considered whether this indicated a risk of impairment. Based on our procedures, we agreed with management that no indicators of impairment were noted for the Properties held by the Group as at year end. We have also assessed and validated the adequacy of the Group s disclosures in respect of significant estimates made on the recoverable amounts for Properties in the consolidated financial statements.

67 INDEPENDENT AUDITOR S REPORT TO THE MEMBERS OF YANLORD LAND GROUP LIMITED 61 ANNUAL REPORT 2016 Key audit matters How the scope of our audit responded to the key audit matters Valuation of investment properties Investment properties (Note 8) represent a significant proportion of the assets in the Group s statement of financial position. The accounting policy for investment properties is set out in Note 2 to the consolidated financial statements. The fair value of the investment properties is based on the valuation performed by an independent professional valuer (the Valuer ). In determining fair values of completed properties, two valuation techniques are used by the Valuer, depending on the nature of each investment property. These valuation techniques used include: (i) direct comparison approach; and (ii) income capitalisation approach. Investment properties under construction are valued using residual approach, which is estimation of the capital value of a development with reference to its development potential by deducting costs and developer s profit from its estimated completed development value. The valuation of the investment properties is a significant estimation area as it is underpinned by a number of key assumptions used in the valuation, which include (i) price per square metre; (ii) capitalisation rates; (iii) market rent per square metre per month. Inappropriate estimates made in the valuation assessment would result in a significant impact on the carrying amount of the investment properties and the fair value changes in the consolidated statements of profit or loss. Our audit procedures on the valuation of investment properties included, among others: We tested the key controls implemented by the management to appoint the Valuer and to review and challenge the work of the Valuer. We assessed the Valuer s competence and capabilities and read their terms of engagement with the Group, determining that there were no matters that affected their independence and objectivity or imposed scope limitations upon them. We discussed with the Valuer to understand the assumptions and valuation techniques used in valuing the investment properties and the market evidence used by the Valuer to support their assumptions. With the assistance of our internal valuation specialist, we evaluated the appropriateness of the valuation techniques used by the Valuer for the respective investment properties. Taking into account the nature of each investment property, we benchmarked and challenged the key assumptions used in their valuation by reference to externally published industry data and comparable property transactions, where available, and we also considered whether these assumptions are consistent with the current market environment. Based on our procedures, we noted that the valuation methodologies adopted by the Valuer are comparable to the methods used for similar property types and consistent with those used in the prior years. In addition, we noted that the key assumptions used in the valuations to be within a reasonable range of our expectations. We have also assessed and validated that the adequacy of the Group s disclosures in respect of the inputs into the valuations properly reflected the assumptions used and met the requirements of the relevant accounting standards.

68 62 YANLORD LAND GROUP LIMITED INDEPENDENT AUDITOR S REPORT TO THE MEMBERS OF YANLORD LAND GROUP LIMITED Key audit matters How the scope of our audit responded to the key audit matters Land appreciation tax ( LAT ) The Group is required to exercise judgement in respect of LAT provision (Note 31) in accordance with the People s Republic of China ( PRC ) tax laws and regulations. Inappropriate management judgement made in the provision of LAT would result in a significant impact to the consolidated statement of profit or loss. Our audit procedures on the LAT provision included, among others: We checked the Group s LAT computations and assessed for consistency with the local legislation and accounting standards, with the assistance of our internal tax specialists in the PRC. We evaluated judgements taken relating to management s provisioning for LAT, by reference to local tax requirements and review of correspondence with tax authorities. Based on our procedures, we concur with management that the LAT provision made by the Group as at year end is appropriate. We have also assessed and validated the adequacy of the Group s disclosures setting out the basis of the LAT provisions and contingencies in Note 31, as well as the level of management judgements involved in the LAT provisions in Note 3 of the consolidated financial statements. Information Other than the Financial Statements and Auditor s Report Thereon Management is responsible for the other information. The other information comprises the information included in the annual report, but does not include the financial statements and our auditor s report thereon. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of Management and Directors for the Financial Statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the provisions of the Act and FRSs, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair financial statements and to maintain accountability of assets. In preparing the financial statements, management is responsible for assessing the Group s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. The directors responsibilities include overseeing the Group s financial reporting process.

69 INDEPENDENT AUDITOR S REPORT TO THE MEMBERS OF YANLORD LAND GROUP LIMITED 63 ANNUAL REPORT 2016 Auditor s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: (a) (b) (c) (d) (e) (f) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. Conclude on the appropriateness of management s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor s report. However, future events or conditions may cause the Group to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. Obtain sufficient appropriate audit evidence regarding the financial information of the entities and business activities within the Group to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

70 64 YANLORD LAND GROUP LIMITED INDEPENDENT AUDITOR S REPORT TO THE MEMBERS OF YANLORD LAND GROUP LIMITED From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the financial statements of the current year and are therefore the key audit matters. We describe these matters in our auditor s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS In our opinion, the accounting and other records required by the Act to be kept by the Company and by those subsidiary corporations incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act. The engagement partner on the audit resulting in this independent auditor s report is Tay Hwee Ling. Deloitte & Touche LLP Public Accountants and Chartered Accountants Singapore March 29, 2017

71 STATEMENTS OF FINANCIAL POSITION December 31, ANNUAL REPORT 2016 GROUP COMPANY Note RMB 000 RMB 000 RMB 000 RMB 000 ASSETS Non-current assets Property, plant and equipment 7 1,819,467 1,549,547 Investment properties 8 13,694,556 11,566,890 Properties for development 9 2,792,938 4,115,661 Investments in subsidiaries 10 2,473,274 2,364,026 Investments in associates ,363 Investments in joint ventures 12 1,200,199 1,093,544 Other receivables , ,704 Non-trade amounts due from: Joint ventures 12 1,202,561 Non-controlling shareholders of subsidiaries , ,115 Intangible asset Deferred tax assets , ,444 Total non-current assets 22,837,911 19,740,518 2,473,274 2,364,026 Current assets Inventories 73,020 58,726 Completed properties for sale 9 4,704,316 7,269,346 Properties under development for sale 9 38,214,800 31,287,170 Trade receivables 22,197 30,551 Other receivables and deposits 14 4,903,935 2,619, Non-trade amounts due from: Subsidiaries 5 14,139,634 12,461,137 Associates 11 1,176, Joint ventures , ,372 Non-controlling shareholders of subsidiaries 13 2,287, ,627 Other related parties Income tax prepayment 916, ,545 Held-for-trading investment 19 19,510 Pledged bank deposits ,680 51,367 Cash and cash equivalents 20 17,583,383 17,516,991 21,902 10,687 Total current assets 70,610,501 60,156,898 14,161,540 12,471,825 Total assets 93,448,412 79,897,416 16,634,814 14,835,851

72 66 YANLORD LAND GROUP LIMITED STATEMENTS OF FINANCIAL POSITION December 31, 2016 GROUP COMPANY Note RMB 000 RMB 000 RMB 000 RMB 000 EQUITY AND LIABILITIES Capital, reserves and non-controlling interests Share capital 21 7,261,726 7,261,726 7,261,726 7,261,726 Reserves 13,785,068 13,073,343 (83,411) (594,366) Equity attributable to owners of the Company 21,046,794 20,335,069 7,178,315 6,667,360 Non-controlling interests 8,962,762 10,199,385 Total equity 30,009,556 30,534,454 7,178,315 6,667,360 Non-current liabilities Bank and other borrowings due after one year 24 12,438,479 8,022, , ,894 Senior notes 25 4,401,192 4,401,192 Deferred tax liabilities 16 2,243,610 1,959,037 Non-trade amount due to a non-controlling shareholder of a subsidiary ,127 Put liability to acquire non-controlling interests 18 1,421,698 Total non-current liabilities 16,440,914 14,382, ,254 4,666,086 Current liabilities Bank and other borrowings due within one year 24 8,311,176 3,971, ,221 Senior notes 25 1,916,309 1,867,109 1,916,309 Trade payables 26 7,926,994 7,747,525 Other payables 27 24,088,948 17,956,456 21,737 96,241 Non-trade amounts due to: Subsidiary 5 5,386,074 3,382,080 Joint venture Ultimate holding company 5 672, ,486 Directors 6 42,418 24,134 42,418 24,084 Non-controlling shareholders of subsidiaries , ,169 Other related parties 6 47,630 9,854 Income tax payable 3,694,269 3,101,863 Derivative financial instruments ,236 Total current liabilities 46,997,942 34,980,668 8,534,245 3,502,405 Total equity and liabilities 93,448,412 79,897,416 16,634,814 14,835,851 See accompanying notes to financial statements.

73 CONSOLIDATED STATEMENT OF PROFIT OR LOSS Financial year ended December 31, ANNUAL REPORT 2016 GROUP Note RMB 000 RMB 000 Revenue 28 25,664,408 16,581,357 Cost of sales (17,644,673) (12,026,205) Gross profit 8,019,735 4,555,152 Other operating income ,281 1,087,664 Selling expenses (397,153) (340,518) Administrative expenses (594,997) (742,304) Other operating expenses (15,202) (6,728) Finance cost 30 (347,819) (206,893) Share of loss of associates 11 (11,790) Share of profit (loss) of joint ventures 12 7,099 (29,260) Profit before income tax 7,472,154 4,317,113 Income tax 31 (3,494,956) (1,946,690) Profit for the year 32 3,977,198 2,370,423 Profit attributable to: Owners of the Company 2,697,361 1,468,539 Non-controlling interests 1,279, ,884 3,977,198 2,370,423 Earnings per share (cents) 33 Basic Diluted See accompanying notes to financial statements.

74 68 YANLORD LAND GROUP LIMITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Financial year ended December 31, 2016 GROUP Note RMB 000 RMB 000 Profit for the year 32 3,977,198 2,370,423 Other comprehensive income: Items that may be reclassified subsequently to profit or loss: Currency translation difference (411,354) (190,440) Cash flow hedge 23 36,361 (29,267) Other comprehensive expense for the year, net of tax (374,993) (219,707) Total comprehensive income for the year 3,602,205 2,150,716 Total comprehensive income attributable to: Owners of the Company 2,322,368 1,248,832 Non-controlling interests 1,279, ,884 3,602,205 2,150,716 See accompanying notes to financial statements.

75 STATEMENTS OF CHANGES IN EQUITY Financial year ended December 31, ANNUAL REPORT 2016 GROUP Share Treasury Currency translation Statutory Merger Hedging Other Accumulated Attributable to owners of the Noncontrolling Note capital share reserve reserve deficit reserve reserve profits Company interests Total RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 (Note 22) (Note 23) Balance at January 1, ,261,726 (87,400) 1,075,491 (1,834,019) (7,094) (337,230) 13,103,297 19,174,771 10,198,470 29,373,241 Effect of changes in investment classification (495) 25,315 24,820 (336,257) (311,437) Balance at January 1, 2015, as restated 7,261,726 (87,895) 1,075,491 (1,834,019) (7,094) (337,230) 13,128,612 19,199,591 9,862,213 29,061,804 Total comprehensive income for the year: Profit for the year 1,468,539 1,468, ,884 2,370,423 Other comprehensive expense for the year (190,440) (29,267) (219,707) (219,707) Total (190,440) (29,267) 1,468,539 1,248, ,884 2,150,716 Transactions with owners, recognised directly in equity: Change of interest in subsidiary (34) Capital injection by non-controlling shareholders 11,400 11,400 Dividends 34 (113,388) (113,388) (113,388) Dividends declared to non-controlling shareholders (576,078) (576,078) Appropriations 168,543 (168,543) Total 168, (281,931) (113,354) (564,712) (678,066) Balance at December 31, ,261,726 (278,335) 1,244,034 (1,834,019) (36,361) (337,196) 14,315,220 20,335,069 10,199,385 30,534,454

76 70 YANLORD LAND GROUP LIMITED STATEMENTS OF CHANGES IN EQUITY Financial year ended December 31, 2016 GROUP Share Treasury Currency translation Statutory Merger Hedging Other Accumulated Attributable to owners of the Noncontrolling Note capital Shares reserve reserve deficit reserve reserve profits Company interests Total RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 (Note 22) (Note 23) Balance at January 1, ,261,726 (278,335) 1,244,034 (1,834,019) (36,361) (337,196) 14,315,220 20,335,069 10,199,385 30,534,454 Total comprehensive income for the year: Profit for the year 2,697,361 2,697,361 1,279,837 3,977,198 Other comprehensive expense for the year (411,354) 36,361 (374,993) (374,993) Total (411,354) 36,361 2,697,361 2,322,368 1,279,837 3,602,205 Transactions with owners, recognised directly in equity: Change of interest in subsidiaries 10 (103) (103) (2,397) (2,500) Capital injection from non-controlling Shareholders 112, ,513 Capital withdrawal by non-controlling shareholders (1,806,473) (1,806,473) Non-controlling interest arising from acquisition of subsidiaries 36 72,504 72,504 Dividends 34 (141,836) (141,836) (141,836) Dividends declared to non-controlling shareholders (784,422) (784,422) Change of control as subsidiaries to associates 37 (108,185) (108,185) Put liability to acquire non-controlling interest 18 (1,421,698) (1,421,698) (1,421,698) Repurchase of shares 22 (47,006) (47,006) (47,006) Appropriations 158,976 (158,976) Total (47,006) 158,976 (1,421,801) (300,812) (1,610,643) (2,516,460) (4,127,103) Balance at December 31, ,261,726 (47,006) (689,689) 1,403,010 (1,834,019) (1,758,997) 16,711,769 21,046,794 8,962,762 30,009,556

77 STATEMENTS OF CHANGES IN EQUITY Financial year ended December 31, ANNUAL REPORT 2016 Currency Accumulated Share Treasury translation (losses) Note capital shares reserve profits Total RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 COMPANY Balance at January 1, ,261,726 (505,335) (153,822) 6,602,569 Total comprehensive income for the year: Profit for the year 237, ,689 Other comprehensive expense for the year (59,510) (59,510) Total (59,510) 237, ,179 Transaction with owners, recognised directly in equity: Dividends 34 (113,388) (113,388) Total (113,388) (113,388) Balance at December 31, ,261,726 (564,845) (29,521) 6,667,360 Total comprehensive income for the year: Profit for the year 381, ,945 Other comprehensive income for the year 317, ,852 Total 317, , ,797 Transaction with owners, recognised directly in equity: Dividends 34 (141,836) (141,836) Repurchase of shares 22 (47,006) (47,006) Total (47,006) (141,836) (188,842) Balance at December 31, ,261,726 (47,006) (246,993) 210,588 7,178,315 See accompanying notes to financial statements.

78 72 YANLORD LAND GROUP LIMITED CONSOLIDATED STATEMENT OF CASH FLOWS Financial year ended December 31, 2016 GROUP RMB 000 RMB 000 Operating activities Profit before income tax 7,472,154 4,317,113 Adjustments for: Depreciation expense 32,085 35,093 Dividend income from held-for-trading investment (93) Fair value gain on investment properties (366,090) (919,865) Fair value gain on held-for-trading investment (5,967) (4,985) Finance cost 347, ,893 Interest income (268,270) (119,239) Net gain on disposal of property, plant and equipment (7,135) (29) Net gain on disposal of investment properties (7,251) (4,962) Net loss on disposal of held-for-trading investment 937 Share of loss of associates 11,790 Share of (profit) loss of joint ventures (7,099) 29,260 Operating cash flows before movements in working capital 7,202,973 3,539,186 Properties for development (270,461) (399,634) Inventories (14,071) (13,747) Completed properties for sale 12,733,840 3,632,749 Properties under development for sale (7,388,342) (169,801) Trade and other receivables and deposits (2,481,718) (2,234,052) Trade and other payables 4,688,181 12,705,481 Cash generated from operations 14,470,402 17,060,182 Interest paid (1,230,321) (1,261,693) Income tax paid (2,950,647) (1,846,525) Net cash from operating activities 10,289,434 13,951,964 Investing activities Acquisition of subsidiaries 36 (1,499,913) Change of control as subsidiaries to associates 37 (146,984) Investments in associates (495,408) Investments in joint ventures (51,160) Dividend received from held-for-trading investment 93 Interest received 191,740 92,271 Increase in pledged bank deposits (469,313) (21,525) Proceeds on disposal of property, plant and equipment 21, Proceeds on disposal of investment properties 39,599 49,593 Proceeds on disposal of held-for-trading investment 24,374 Payment for property, plant and equipment (382,911) (510,694) Payment for investment properties (1,608,985) (207,367) Advance to associates (1,266,762) (68) Repayment from associates 177,282 Advance to joint ventures (3,288,874) (95,973) Repayment from joint ventures 2,446,508 (Advance to) Repayment from non-controlling shareholders of subsidiaries (1,824,530) 108,815 Net cash used in investing activities (8,133,366) (583,882)

79 CONSOLIDATED STATEMENT OF CASH FLOWS Financial year ended December 31, ANNUAL REPORT 2016 GROUP Note RMB 000 RMB 000 Financing activities Dividends paid 34 (141,836) (113,388) Dividends paid to non-controlling shareholders of subsidiaries (Note A) (746,936) (655,402) Proceeds from bank and other borrowings 15,834,321 3,769,800 Repayment of bank and other borrowings (9,821,984) (5,526,974) Purchase of treasury shares 22 (47,006) Repurchase and redemption of senior notes (4,514,269) (128,940) Advance from joint venture 365 Advance from directors 16,853 3,178 Advance from ultimate holding company 677,572 Advance from non-controlling shareholders of subsidiaries 401,243 21,196 Repayment to non-controlling shareholders of subsidiaries (1,708,461) Advance from other related parties 37,776 7,858 Cash injection from non-controlling shareholders of subsidiaries 112,513 11,400 Cash withdrawal by non-controlling shareholders of subsidiaries (1,806,473) Acquisition of non-controlling interest in a subsidiary (2,500) Net cash used in financing activities (1,708,822) (2,611,272) Net increase in cash and cash equivalents 447,246 10,756,810 Cash and cash equivalents at beginning of year 20 17,516,991 6,556,843 Effect of exchange rate changes on the balance of cash held in foreign currencies (380,854) 203,338 Cash and cash equivalents at end of year 20 17,583,383 17,516,991 Note A During the year, the Group declared dividends of RMB784 million (2015 : RMB576 million) to non-controlling shareholders of subsidiaries, of which RMB37 million (2015 : RMB1 million) was unpaid as at year end and was included in amount due to non-controlling shareholders of subsidiaries as at December 31, In 2015, dividends paid to non-controlling shareholders of subsidiaries of RMB655 million included RMB80 million which was declared in See accompanying notes to financial statements.

80 74 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, GENERAL The Company (Registration No K) is incorporated in the Republic of Singapore with its principal place of business and registered office at 9 Temasek Boulevard, #36-02 Suntec Tower Two, Singapore The Company is listed on the Singapore Exchange Securities Trading Limited. The financial statements are expressed in Renminbi ( RMB ). The principal activity of the Company is to carry on the business of an investment holding company and procurer of funds. The principal activities of the subsidiaries are disclosed in Note 10 to the financial statements. The consolidated financial statements of the Group and statement of financial position and statement of changes in equity of the Company for the financial year ended December 31, 2016 were authorised for issue by the Board of Directors on March 29, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING The financial statements are prepared in accordance with the historical cost basis except as disclosed in the accounting policies below, and are drawn up in accordance with the provisions of the Singapore Companies Act and Financial Reporting Standards in Singapore ( FRSs ). Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes into account the characteristics of the asset or liability which market participants would take into account when pricing the asset or liability at the measurement date. Fair value for measurement and / or disclosure purposes in these consolidated financial statements is determined on such a basis, except for leasing transactions that are within the scope of FRS 17 Leases, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in FRS 2 Inventories or value in use in FRS 36 Impairment of Assets. In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and Level 3 inputs are unobservable inputs for the asset or liability. ADOPTION OF NEW AND REVISED STANDARDS On January 1, 2016, the Group adopted all the new and revised FRSs and Interpretations of FRS ( INT FRS ) that are effective from that date and are relevant to its operations. The adoption of these new / revised FRSs and INT FRS does not result in changes to the Group s and the Company s accounting policies and has no material effect on the amounts reported for the current or prior years.

81 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) At the date of authorisation of these financial statements, the following new / revised FRSs, INT FRS and amendments to FRS that are relevant to the Group and the Company were issued but not effective: FRS 109 Financial Instruments 1 FRS 115 Revenue from Contracts with Customers (with clarifications issued) 1 FRS 116 Leases 2 Amendments to FRS 7 Statement of Cash Flows: Disclosure Initiative 3 Amendment to FRS 12 Income Taxes: Recognition of Deferred Tax Assets for Unrealised Losses 3 Amendments to FRS 110 Consolidated Financial Statements and FRS 28 Investments in Associates and Joint Ventures: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture 4 1 Applies to annual periods beginning on or after January 1, 2018, with early application permitted. 2 Applies to annual periods beginning on or after January 1, 2019, with early application permitted if FRS 115 is adopted. 3 Applies to annual periods beginning on or after January 1, 2017, with early application permitted. 4 Application has been deferred indefinitely, however early application is still permitted. Consequential amendments were also made to various standards as a result of these new / revised standards. The management anticipates that the adoption of the above FRSs, INT FRS and amendments to FRS in future periods will not have a material impact on the financial statements of the Group and the Company in the period of their initial adoption except for the following: FRS 109 Financial Instruments FRS 109 was issued in December 2014 to replace FRS 39 Financial Instruments: Recognition and Measurement and introduced new requirements for (i) the classification and measurement of financial assets and financial liabilities (ii) general hedge accounting and (iii) impairment requirements for financial assets. Key requirements of FRS 109: All recognised financial assets that are within the scope of FRS 39 are now required to be subsequently measured at amortised cost or fair value through profit or loss (FVTPL). Specifically, debt instruments that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest on the principal outstanding are generally measured at amortised cost at the end of subsequent accounting periods. Debt instruments that are held within a business model whose objective is achieved both by collecting contractual cash flows and selling financial assets, and that have contractual terms that give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding, are measured at fair value through other comprehensive income (FVTOCI). All other debt investments and equity investments are measured at FVTPL at the end of subsequent accounting periods. In addition, under FRS 109, entities may make an irrevocable election, at initial recognition, to measure an equity investment (that is not held for trading) at FVTOCI, with only dividend income generally recognised in profit or loss.

82 76 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) With some exceptions, financial liabilities are generally subsequently measured at amortised cost. With regard to the measurement of financial liabilities designated as at FVTPL, FRS 109 requires that the amount of change in fair value of the financial liability that is attributable to changes in the credit risk of that liability is presented in other comprehensive income, unless the recognition of the effects of changes in the liability s credit risk in other comprehensive income would create or enlarge an accounting mismatch to profit or loss. Changes in fair value attributable to a financial liability s credit risk are not subsequently reclassified to profit or loss. In relation to the impairment of financial assets, FRS 109 requires an expected credit loss model, as opposed to an incurred credit loss model under FRS 39. The expected credit loss model requires an entity to account for expected credit losses and changes in those expected credit losses at each reporting date to reflect changes in credit risk since initial recognition. In other words, it is no longer necessary for a credit event to have occurred before credit losses are recognised. The new general hedge accounting requirements retain the three types of hedge accounting mechanisms currently available in FRS 39. Under FRS 109, greater flexibility has been introduced to the types of transactions eligible for hedge accounting, specifically broadening the types of instruments that qualify for hedging instruments and the types of risk components of non-financial items that are eligible for hedge accounting. In addition, the effectiveness test has been overhauled and replaced with the principle of an economic relationship. Retrospective assessment of hedge effectiveness is also no longer required. Enhanced disclosure requirements about an entity s risk management activities have also been introduced. Management anticipates that the initial application of the new FRS 109 may not result in any material changes to the accounting policies relating to financial instruments. Additional disclosures may be made with respect of trade and other receivables, including any significant judgement and estimation made. Management has commenced an assessment of the possible impact of implementing FRS 109. It is currently impracticable to disclose any further information on the known or reasonably estimable impact to the Group s financial statements in the period of initial application as the management has yet to complete its detailed assessment. Management does not plan to early adopt the new FRS 109. FRS 115 Revenue from Contracts with Customers In November 2014, FRS 115 was issued which establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. FRS 115 will supersede the current revenue recognition guidance including FRS 18 Revenue, FRS 11 Construction Contracts and the related Interpretations when it becomes effective. Further clarifications to FRS 115 were also issued in June The core principle of FRS 115 is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Specifically, the Standard introduces a 5-step approach to revenue recognition: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation.

83 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Under FRS 115, an entity recognises revenue when (or as) a performance obligation is satisfied, i.e. when control of the goods or services underlying the particular performance obligation is transferred to the customer. Far more prescriptive guidance has been added in FRS 115 to deal with specific scenarios. Furthermore, extensive disclosures are required by FRS 115. Management anticipates that the initial application of the new FRS 115 may not result in material changes to the accounting policies relating to revenue recognition. Additional disclosures will be made with respect of revenue and deferred revenue, including information about contracts with customers, contract balances and performance obligation. Management has commenced an assessment of the possible impact of implementing FRS 115. It is currently impracticable to disclose any further information on the known or reasonably estimable impact to the Group s financial statements in the period of initial application as the management has yet to complete its detailed assessment. The management does not plan to early adopt the new FRS 115. FRS 116 Leases FRS 116 was issued in June 2016 and will supersede FRS 17 Leases and its associated interpretative guidance. The Standard provides a comprehensive model for the identification of lease arrangements and their treatment in the financial statements of both lessees and lessors. The identification of leases, distinguishing between leases and service contracts, are determined on the basis of whether there is an identified asset controlled by the customer. Significant changes to lessee accounting are introduced, with the distinction between operating and finance leases removed and assets and liabilities recognised in respect of all leases (subject to limited exceptions for short-term leases and leases of low value assets). The Standard maintains substantially the lessor accounting approach under the predecessor FRS 17. Management anticipates that the initial application of the new FRS 116 will result in changes to the accounting policies relating to operating leases, where the Group is a lessee. A lease asset will be recognised on statement of financial position, representing the Group s right to use the leased asset over the lease term and, recognising corresponding liability to make lease payments. Additional disclosures may be made with respect of the Group s exposure to asset risk and credit risk, where the Group is the lessor. Management has commenced an assessment of the possible impact of implementing FRS 116. It is currently impracticable to disclose any further information on the known or reasonably estimable impact to the Group s financial statements in the period of initial application as the management has yet to complete its detailed assessment. Management does not plan to early adopt the new FRS 116. Amendments to FRS 7 Statement of Cash Flows: Disclosure Initiative The amendments required an entity to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes. Management anticipates that the initial application of Amendments to FRS 7 will result in additional disclosures to be made with respect to statement of cash flows. Management has commenced an assessment of the possible impact of implementing Amendments to FRS 7. It is currently impracticable to disclose any further information on the known or reasonably estimable impact to the Group s financial statements in the period of initial application as the management has yet to complete its detailed assessment. The management does not plan to early adopt the Amendments to FRS 7.

84 78 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) IFRS convergence in 2018 Singapore-incorporated companies listed on the Singapore Exchange will be required to apply a new Singapore financial reporting framework that is identical to the International Financial Reporting Standards ( IFRSs ) for annual periods beginning on or after January 1, The Group will be adopting the new framework for the first time for financial year ending December 31, Based on a preliminary assessment of the potential impact arising from IFRS 1 First-time adoption of IFRS, management does not expect significant changes to the Group s current accounting policies or material adjustments on transition to the new framework, other than those that may arise from implementing new / revised IFRSs as set out in the preceding paragraphs on the equivalent FRSs. Management is currently performing a detailed analysis of the transition options and other requirements of IFRS 1. Particularly, management is evaluating the transition option to zerorise cumulative translation differences that exist in reserves for companies with foreign subsidiaries, joint arrangements, associates, and if elected, may result in material adjustments on transition to the new framework. BASIS OF CONSOLIDATION The consolidated financial statements incorporate the financial statements of the Company and entities (including structured entities) controlled by the Company and its subsidiaries. Control is achieved when the Company: Has power over the investee; Is exposed, or has rights, to variable returns from its involvement with the investee; and Has the ability to use its power to affect its returns. The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above. When the Company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant facts and circumstances in assessing whether or not the Company s voting rights in an investee are sufficient to give it power, including: The size of the Company s holding of voting rights relative to the size and dispersion of holdings of the other vote holders; Potential voting rights held by the Company, other vote holders or other parties; Rights arising from other contractual arrangements; and Any additional facts and circumstances that indicate that the Company has, or does not have, the current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders meetings. Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit or loss from the date the Company gains control until the date when the Company ceases to control the subsidiary.

85 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Profit or loss and each component of other comprehensive income are attributed to the owners of the Company and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group s accounting policies. Changes in the Group s ownership interests in existing subsidiaries Changes in the Group s ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Group s interests and the noncontrolling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the Company. When the Group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the difference between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests. All amounts previously recognised in other comprehensive income in relation to that subsidiary are accounted for as if the Group had directly disposed of the related assets or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as specified / permitted by applicable FRSs). The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under FRS 39, when applicable, the cost on initial recognition of an investment in an associate or a joint venture. In the Company s financial statements, investments in subsidiaries are carried at cost less any impairment in net recoverable value that has been recognised in profit or loss. BUSINESS COMBINATIONS The acquisition of subsidiaries from a common controlling shareholder is accounted for using the merger accounting method. Under this method, the Company has been treated as the holding company of the subsidiaries for the financial years presented rather than from the date of acquisition of the subsidiaries. The acquisition of subsidiaries from a party other than a common controlling shareholder is accounted for using the acquisition method. The consideration for each acquisition is measured at the aggregate of the acquisition date fair values of assets given, liabilities incurred by the Group to the former owners of the acquiree, and equity interests issued by the Group in exchange for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred. Where applicable, the consideration for the acquisition includes any asset or liability resulting from a contingent consideration arrangement, measured at its acquisition-date fair value. Subsequent changes in such fair values are adjusted against the cost of acquisition where they qualify as measurement period adjustments (see below). The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration that is classified as equity is not remeasured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability is remeasured at subsequent reporting dates at fair value, with changes in fair value recognised in profit or loss.

86 80 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Where a business combination is achieved in stages, the Group s previously held interests in the acquired entity are remeasured to fair value at the acquisition date (i.e. the date the Group attains control) and the resulting gain or loss, if any, is recognised in profit or loss. Amounts arising from interests in the acquiree prior to the acquisition date that have previously been recognised in other comprehensive income are reclassified to profit or loss, where such treatment would be appropriate if that interest were disposed of. The acquiree s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under the FRS are recognised at their fair value at the acquisition date, except that: Deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognised and measured in accordance with FRS 12 Income Taxes and FRS 19 Employee Benefits respectively; Liabilities or equity instruments related to share-based payment transactions of the acquiree or the replacement of an acquiree s share-based payment awards transactions with share-based payment awards transactions of the acquirer in accordance with the method in FRS 102 Share-based Payment at the acquisition date; and Assets (or disposal groups) that are classified as held for sale in accordance with FRS 105 Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard. Non-controlling interests that are present ownership interests and entitle their holders to a proportionate share of the entity s net assets in the event of liquidation may be initially measured either at fair value or at the non-controlling interests proportionate share of the recognised amounts of the acquiree s identifiable net assets. The choice of measurement basis is made on a transaction-by-transaction basis. Other types of non-controlling interests are measured at fair value or, when applicable, on the basis specified in another FRS. If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see below), or additional assets or liabilities are recognised, to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the amounts recognised as of that date. The measurement period is the period from the date of acquisition to the date the Group obtains complete information about facts and circumstances that existed as of the acquisition date and is subject to a maximum of one year from acquisition date. PUT LIABILITY TO ACQUIRE NON-CONTROLLING INTERESTS When an entity within the Group writes noncancellable rights for non-controlling shareholders to put back their shares to the entity (the Put Instruments ) as part of the acquisition of a subsidiary for settlement in cash, a put liability is recognised for the present value of the exercise price of the Put Instruments. This creates an obligation or potential obligation for the entity to purchase its subsidiary s instruments (constitutes the Group s own equity in the consolidated financial statements) for cash. When the non-controlling shareholders still have present access to the returns associated with the underlying ownership interests, the Group has chosen an accounting policy that the non-controlling interests continue to be recognised. Therefore, the present value of the Put Instruments is recognised in equity. Subsequent to initial recognition of the financial liability, changes in the carrying amount of the financial liability is recongised in profit or loss.

87 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) If the Put Instrument expires unexercised, then the charge to equity will be reversed and the financial liability will be derecognised. If the Put Instruments are exercised, then the charge to equity will be reversed and the financial liability will be derecognised and acquisition accounting will be applied, whereby the acquisition of the Group s ownership interests in a subsidiary that do not result in the change in control over the subsidiary are accounted for as equity transactions. FINANCIAL INSTRUMENT Financial assets and financial liabilities are recognised on the Group s statement of financial position when the Group becomes a party to the contractual provisions of the instrument. Effective interest method The effective interest method is a method of calculating the amortised cost of a financial instrument and of allocating interest income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments (including all fees on points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial instrument, or where appropriate, a shorter period. Income and expense are recognised on an effective interest basis for debt instruments other than those financial instruments at fair value through profit or loss. Financial assets All financial assets are recognised and de-recognised on a trade date where the purchase or sale of an investment is under a contract whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially measured at fair value, plus transaction costs except for those financial assets classified as at fair value through profit or loss which are initially measured at fair value. Financial assets are classified into the following specified categories: financial assets at fair value through profit or loss and loans and receivables. The classification depends on the nature and purpose of financial assets and is determined at the time of initial recognition. Financial assets at fair value through profit or loss (FVTPL) Financial assets are classified as at FVTPL where the financial asset is either held-for-trading or it is designated as at FVTPL. A financial asset is classified as held-for-trading if: it has been acquired principally for the purpose of selling in the near future; or it is a part of an identified portfolio of financial instruments that the Group manages together and has a recent actual pattern of short-term profit-taking; or it is a derivative that is not designated and effective as a hedging instrument. Financial assets at FVTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any dividend or interest earned on the financial asset and is included in other operating income or other operating expense line in the consolidated statement of profit or loss. Fair value is determined in the manner described in Note 4 (c) (vi).

88 82 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Loans and receivables Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest method, except for short-term receivables when the effect of discounting is immaterial. Impairment of financial assets Financial assets, other than those at fair value through profit or loss, are assessed for indicators of impairment at the end of each reporting period. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted. Objective evidence of impairment could include: Significant financial difficulty of the issuer or counterparty; or Default or delinquency in interest or principal payments; or It becoming probable that the borrower will enter bankruptcy or financial re-organisation. For certain categories of financial assets, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the Group s past experience of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit period, as well as observable changes in national or local economic conditions that correlate with default on receivables. For financial assets carried at amortised cost, the amount of the impairment is the difference between the asset s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade and other receivables where the carrying amount is reduced through the use of an allowance account. When a trade or other receivable is uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss. For financial assets measured at amortised cost, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment loss was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount of the financial asset at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised. Derecognition of financial assets The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.

89 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Financial liabilities and equity instruments Classification as debt or equity Financial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument. Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs. Financial liabilities Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, using the effective interest method, with interest expense recognised on an effective yield basis. Interest-bearing bank and other borrowings and senior notes are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest method. Interest expense calculated using the effective interest method is recognised over the term of the borrowings in accordance with the Group s accounting policy for borrowing costs (see below). Financial guarantee contract liabilities are measured initially at their fair values and, if not designated as FVTPL, subsequently at the higher of the amount of obligation under the contract recognised as a provision in accordance with FRS 37 Provisions, Contingent Liabilities and Contingent Assets and the amount initially recognised less cumulative amortisation in accordance with FRS 18 Revenue. Derecognition of financial liabilities The Group derecognises financial liabilities when, and only when, the Group s obligations are discharged, cancelled or they expire. Derivative financial instruments and hedge accounting The Group enters into derivative financial instruments to manage its exposure to foreign exchange rate risk. Further details of derivative financial instruments are disclosed in Note 17 to the financial statements. Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship. The Group designates certain derivatives as hedges of foreign currency risk of firm commitments (cash flow hedges). A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realised or settled within 12 months.

90 84 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Embedded derivatives Derivatives embedded in other financial instruments or other host contracts are treated as separate derivatives when their risks and characteristics are not closely related to those of the host contracts and the host contracts are not measured at fair value with changes in fair value recognised in profit or loss. An embedded derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the hybrid instrument to which the embedded derivative relates is more than 12 months and it is not expected to be realised or settled within 12 months. Other embedded derivatives are presented as current assets or current liabilities. Hedge accounting The Group designates certain hedging instruments of derivatives as cash flow hedges. Hedges of foreign exchange risk on firm commitments are accounted for as cash flow hedges. At the inception of the hedge relationship the entity documents the relationship between the hedging instrument and hedged item, along with its risk management objectives and its strategy for undertaking various hedge transactions. Furthermore, at the inception of the hedge and on an ongoing basis, the Group documents whether the hedging instrument that is used in a hedging relationship is highly effective in offsetting changes in fair values or cash flows of the hedged item. Note 17 contain details of the fair values of the derivative instruments used for hedging purposes. Movements in the hedging reserve in other comprehensive income are also detailed in Note 23. Cash flow hedge The effective portion of changes in fair value of derivatives that are designed and qualify as cash flow hedges are recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss as part of other gains and losses. Amounts recognised in other comprehensive income and accumulated in equity are reclassified to profit or loss in the periods when the hedged item is recognised in profit or loss in the same line of the consolidated statement of profit or loss and consolidated statement of comprehensive income as the recognised hedged item. However, when the forecast transaction that is hedged results in the recognition of a non-financial asset or a non-financial liability, the gains and losses previously accumulated in equity are transferred from equity and included in the initial measurement of the cost of the asset or liability. Hedge accounting is discontinued when the Group revokes the hedging relationship, the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge accounting. Any gain or loss accumulated in equity at that time remains in equity and when the forecast transaction is ultimately recognised in profit or loss, such gains and losses are recognised in profit or loss, or transferred from equity and included in the initial measurement of the cost of the asset or liability as described above. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was accumulated in equity is recognised immediately in profit or loss.

91 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Offsetting arrangements Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when the Company and the Group has a legally enforceable right to set off the recognised amounts; and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. A right to set-off must be available today rather than being contingent on a future event and must be exercisable by any of the counterparties, both in the normal course of business and in the event of default, insolvency or bankruptcy. LEASES Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. The Group as lessor Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which use benefit derived from the leased asset is diminished. Initial direct costs incurred in negotiating and arranging an operating lease are recognised on a straight-line basis over the lease term on the same basis as the leased income. The Group as lessee Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred. PROPERTIES FOR DEVELOPMENT Properties for development are mainly vacant leasehold land for future development in respect of which physical construction is not expected to commence within twelve months from the end of the reporting period. They are stated at cost less allowance for any impairment in value. PROPERTIES UNDER DEVELOPMENT FOR SALE Properties under development for sale are stated at lower of cost and net realisable value. Net realisable value takes into account the price ultimately expected to be realised and the anticipated costs to completion. Cost of property under development comprises land cost, development costs and borrowing costs capitalised during the development period. When completed, the units held for sale are classified as completed properties for sale. Properties under development for sale include properties in respect of which concrete planning and preparatory activities have been approved by management and have commenced, and physical construction is expected to commence within twelve months from the end of the reporting period. COMPLETED PROPERTIES FOR SALE Completed properties for sale are stated at lower of cost or net realisable value. Cost is determined by apportionment of the total land cost, development costs and capitalised borrowing costs based on floor area of the unsold properties. Net realisable value is determined by reference to sale proceeds of properties sold in the ordinary course of business less all estimated selling expenses; or is estimated by management in the absence of comparable transactions after taking into consideration prevailing market conditions. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses.

92 86 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Construction-in-progress consists of land cost, construction costs and capitalised borrowing costs incurred during the period of construction. Depreciation is charged so as to write off the cost of property, plant and equipment, other than construction-inprogress, over their estimated useful lives, using the straight-line method on the following bases: Leasehold land and buildings 2% to 5% Motor vehicles 10% to 25% Furniture, fixtures and equipment 20% The estimated useful lives, residual values and depreciation method are reviewed at each year end, with the effect of any changes in estimate accounted for on a prospective basis. Fully depreciated property, plant and equipment still in use are retained in the financial statements. The gain or loss arising on the disposal or retirement of a property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss. INVESTMENT PROPERTIES Investment properties are properties held to earn rental income and / or for capital appreciation and properties under construction for such purposes. They are measured initially at cost, including transaction costs and subsequent to initial recognition, measured at fair value. Professional valuations are obtained at least once every year. Gains or losses arising from changes in the fair value of investment property are included in profit or loss for the period in which they arise. Where there is an inability to determine fair value reliably when comparable market transactions are infrequent and alternative reliable estimates of fair value are not available, the investment property is measured at cost. An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period in which the property is derecognised. Transfers are made to or from investment properties when and only when there is a change in use. For a transfer from properties for development, properties under development for sale or completed properties for sale to investment properties, any difference between the fair value of the properties at that date and its previous carrying amount is recognised in profit or loss. INTANGIBLE ASSET This relates to a club membership held on a long-term basis and is stated at cost less any impairment loss. IMPAIRMENT OF TANGIBLE AND INTANGIBLE ASSETS At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets other than investment properties, derivative financial instruments and held-for-trading investment carried at fair value, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

93 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss. Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cashgenerating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss. ASSOCIATE AND JOINT VENTURES An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. The results and assets and liabilities of associates or joint ventures are incorporated in these consolidated financial statements using the equity method of accounting. Under the equity method, an investment in an associate or a joint venture is initially recognised in the consolidated statement of financial position at cost and adjusted thereafter to recognise the Group s share of the profit or loss and other comprehensive income of the associate or joint venture. When the Group s share of losses of an associate or a joint venture exceeds the Group s interest in that associate or joint venture (which includes any long-term interests that, in substance, form part of the Group s net investment in the associate or joint venture), the Group discontinues recognising its share of further losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate or joint venture. Investment in an associate or a joint venture is accounted for using the equity method from the date on which the investee becomes an associate or a joint venture. On acquisition of the investment in an associate or a joint venture, any excess of the cost of the investment over the Group s share of the net fair value of the identifiable assets and liabilities of the investee is recognised as goodwill, which is included within the carrying amount of the investment. Any excess of the Group s share of the net fair value of the identifiable assets and liabilities over the cost of the investment, after reassessment, is recognised immediately in profit or loss in the period in which the investment is acquired. The requirements of FRS 39 are applied to determine whether it is necessary to recognise any impairment loss with respect to the Group s investment in an associate or a joint venture. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with FRS 36 Impairment of Assets as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs to sell) with its carrying amount, any impairment loss recognised forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognised in accordance with FRS 36 to the extent that the recoverable amount of the investment subsequently increases.

94 88 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) The Group discontinues the use of the equity method from the date when the investment ceases to be an associate or a joint venture, or when the investment is classified as held for sale. When the Group retains an interest in the former associate or joint venture and the retained interest is a financial asset, the Group measures the retained interest at fair value at that date and the fair value is regarded as its fair value on initial recognition in accordance with FRS 39. The difference between the carrying amount of the associate or joint venture at the date the equity method was discontinued, and the fair value of any retained interest and any proceeds from disposing of a part interest in the associate or joint venture is included in the determination of the gain or loss on disposal of the associate or joint venture. In addition, the Group accounts for all amounts previously recognised in other comprehensive income in relation to that associate or joint venture on the same basis as would be required if that associate or joint venture had directly disposed of the related assets or liabilities. Therefore, if a gain or loss previously recognised in other comprehensive income by that associate or joint venture would be reclassified to profit or loss on the disposal of the related assets or liabilities, the Group reclassifies the gain or loss from equity to profit or loss (as a reclassification adjustment) when the equity method is discontinued. The Group continues to use the equity method when investment in an associate becomes investment in a joint venture or investment in a joint venture becomes investment in an associate. There is no remeasurement to fair value upon such changes in ownership interests. When the Group reduces its ownership interest in an associate or a joint venture but the Group continues to use the equity method, the Group reclassifies to profit or loss the proportion of the gain or loss that had previously been recognised in other comprehensive income relating to that reduction in ownership interest if that gain or loss would be reclassified to profit or loss on the disposal of the related assets or liabilities. When a group entity transacts with an associate or a joint venture of the Group, profits and losses resulting from the transactions with the associate or joint venture are recognised in the Group s consolidated financial statements only to the extent of interests in the associate or joint venture that are not related to the Group. PROVISIONS Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably. MERGER DEFICIT Merger deficit arises from combination of entities under common control accounted for using merger accounting method (see Business Combinations ). The merger reserve represents the difference between the aggregate nominal amounts of the share capital of the subsidiaries at the date on which they were acquired by the Group and the nominal amount of the share capital issued by the Company as consideration for the acquisition. STATUTORY RESERVE Statutory reserve represents the amount transferred from profit after tax of the subsidiaries incorporated in the People s Republic of China ( PRC ) (excluding Hong Kong) in accordance with the PRC requirement. The statutory reserve cannot be reduced except where approval is obtained from the relevant PRC authority to apply the amount towards setting off any accumulated losses or increasing capital.

95 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) OTHER RESERVE The negative balance in other reserve comprises (i) the net excess of purchase consideration over the carrying amount of non-controlling interests acquired in the subsidiaries at the date of acquisition; and (ii) the charge of the present value of a put liability in relation to put instruments entered into with the non-controlling shareholders on their equity interests in a subsidiary. Subsequent changes in the carrying value of the put liability are recognised in profit or loss. REVENUE RECOGNITION Revenue is measured at the fair value of the consideration received or receivable. Sale of properties developed Revenue from properties developed for sale is recognised when the legal title passes to the buyer or when the equitable interest in the property vests in the buyer upon release of the handover notice of the respective property to the buyer, whichever is the earlier. Payments received from buyers prior to this stage are recorded as advances received from customers for sales of properties and are classified as current liabilities. Rendering of services Management fee income and service income are recognised over the period when services are rendered. Interest income Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable. Dividend income Dividend income from investments is recognised when the shareholders rights to receive payment have been established. Rental income Rental income from investment properties is recognised on a straight-line basis over the term of the relevant lease. GOVERNMENT SUBSIDIES Government subsidies are not recognised until there is reasonable assurance that the Group will comply with the conditions attaching to them and the subsidies will be received. Government subsidies are recognised as income over the periods necessary to match them with the related costs. Government subsidies related to expense items are recognised in the same period as those expenses are charged to the profit or loss and are reported separately as other operating income. BORROWING COSTS Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of these assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

96 90 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) RETIREMENT BENEFIT COSTS Payments to defined contribution retirement benefit plans are charged as an expense when employees have rendered the services entitling them to the contributions. Payments made to statemanaged retirement benefit schemes, such as the Singapore Central Provident Fund, are dealt with as payments to defined contribution plans where the Group s obligations under the plans are equivalent to those arising in a defined contribution retirement benefit plan. Pursuant to the relevant regulations of the PRC government, the PRC subsidiaries of the Group ( PRC Subsidiaries ) have participated in central pension schemes ( the Schemes ) operated by local municipal governments whereby the PRC Subsidiaries are required to contribute a certain percentage of the basic salaries of their employees to the Schemes to fund their retirement benefits. The local municipal governments undertake to assume the retirement benefit obligations of all existing and future retired employees of the PRC Subsidiaries. The only obligation of the PRC Subsidiaries with respect to the Schemes is to pay the ongoing required contributions under the Schemes mentioned above. Contributions under the Schemes are charged as expense when incurred. EMPLOYEE LEAVE ENTITLEMENT Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the end of the reporting period. INCOME TAX Income tax expense represents the sum of the tax currently payable and deferred tax. The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the consolidated statement of profit or loss because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are not taxable or tax deductible. The Group s liability for current tax is calculated using tax rates (and tax laws) that have been enacted or substantively enacted in countries where the Company and subsidiaries operate by the end of the reporting period. Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at tax rates that are expected to apply in the period when the liability is settled or the asset realised based on the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Except for investment properties measured using the fair value model, the measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

97 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) For the purposes of measuring deferred tax liabilities and deferred tax assets for investment properties that are measured using the fair value model, the carrying amounts of such properties are presumed to be recovered through sale, unless the presumption is rebutted. The presumption is rebutted when the investment property is depreciable and is held within a business model of the Group whose business objective is to consume substantially all of the economic benefits embodied in the investment property over time, rather than through sale. The Group has rebutted the presumption that the carrying amount of the investment properties will be recovered entirely through sale. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis. Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items credited or debited outside profit or loss (either in other comprehensive income or directly in equity), in which case the tax is also recognised outside profit or loss (either in other comprehensive income or directly in equity), or where they arise from the initial accounting for a business combination. In the case of a business combination, the tax effect is taken into account in calculating goodwill or determining the excess of the acquirer s interest in the net fair value of the acquiree s identifiable assets, liabilities and contingent liabilities over cost. FOREIGN CURRENCY TRANSACTIONS AND TRANSLATION The individual financial statements of each Group entity are measured and presented in the currency of the primary economic environment in which the entity operates (its functional currency). The presentation currency for the consolidated financial statements of the Group and the statement of financial position of the Company is RMB. In preparing the financial statements of the individual entities, transactions in currencies other than the entity s functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the end of each reporting period. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Exchange differences arising on the settlement of monetary items, and on retranslation of monetary items are included in profit or loss for the period. Exchange differences arising on the retranslation of non-monetary items carried at fair value are included in profit or loss for the period except for differences arising on the retranslation of non-monetary items in respect of which gains and losses are recognised in other comprehensive income. For such non-monetary items, any exchange component of that gain or loss is also recognised directly in other comprehensive income. Exchange differences on foreign currency borrowings relating to assets under construction for future productive use, are included in the cost of those assets when they are regarded as an adjustment to interest costs on those foreign currency borrowings. Exchange differences on transactions entered into in order to hedge certain foreign currency risks are described in the hedge accounting policies above. For the purpose of presenting consolidated financial statements, the assets and liabilities of the entities in the Group which do not have RMB as the functional currency (including comparatives) are expressed in RMB using exchange rates prevailing at the end of each reporting period. Income and expense items (including comparatives) are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are classified as other comprehensive income and transferred to the Group s currency translation reserve.

98 92 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont d) CASH AND CASH EQUIVALENTS IN THE CONSOLIDATED STATEMENT OF CASH FLOWS Cash and cash equivalents in the consolidated statement of cash flows comprise cash on hand, cash at bank and fixed deposits and are subject to an insignificant risk of changes in value. 3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY In the application of the Group s accounting policies, which are described in Note 2 above, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. Critical judgements in applying the Group s accounting policies The following are the critical judgements, apart from those involving estimations (see below), that management has made in the process of applying the Group s accounting policies and that have the most significant effect on the amounts recognised in the financial statements. Land Appreciation Tax ( LAT ) Income from sale of properties in the PRC is subject to LAT at progressive rates under the PRC tax laws and regulations. The management estimates and provides for LAT in accordance with the PRC tax laws and regulations. The management has assessed and considers the provision of LAT as at the end of the reporting period to be adequate. The LAT expense recorded during the year is disclosed in Note 31. Control over entities for which the Group does not have more than 50% ownership interest and voting rights Note 10 describes that Shanghai Renpin Property Development Co., Ltd. and Suzhou Renan Real Estate Co., Ltd. are subsidiaries of the Group even though the Group has only a 50% and 30% ownership interest and shareholder s voting rights in these two entities respectively. The management of the Company assessed whether or not the Group has control over these entities based on whether the Group has the practical ability to direct the relevant activities of these entities unilaterally. In making their judgement, the management considered the Group s rights arising from the contractual arrangements. After assessment, the management concluded that the Group has sufficiently dominant voting right and power to direct the relevant activities of these entities and therefore the Group has unilateral control over these entities. Classification of Singapore Intelligent Eco Island Development Pte. Ltd. as joint venture Singapore Intelligent Eco Island Development Pte. Ltd. is a Singapore-incorporated company whose legal form confers separation between the parties to the joint arrangement and the company itself. Furthermore, there is no contractual arrangement or any other facts and circumstances that indicate that the parties to the joint arrangements have rights to the assets and obligations for the liabilities of the joint arrangements. Accordingly, Singapore Intelligent Eco Island Development Pte. Ltd. is classified as a joint venture of the Group (Note 12).

99 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (Cont d) Key sources of estimation uncertainty The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below. Carrying amounts of properties for development, completed properties for sale and properties under development for sale The aggregate carrying amount of these properties totalled RMB billion as at December 31, 2016 (2015 : RMB billion), details of which are disclosed in Note 9. They are stated at cost less allowance for impairment in value or at the lower of cost and net realisable values, assessed on an individual property basis. When it is probable that the total project costs will exceed the total projected revenue net of selling expenses, i.e. net realisable value, the amount in excess of net realisable value is recognised as an expense immediately. The process of evaluating the net realisable value for each property is subject to management s judgement and the effect of assumptions in respect of development plans, timing of sale and the prevailing market conditions. Management performs cost studies for each project, taking into account the costs incurred to date, the development status and costs to complete each development project. Any future variation in plans, assumptions and estimates can potentially impact the carrying amounts of the respective properties. Valuation of investment properties As disclosed in Note 8, investment properties are stated at fair value based on the valuation performed by an independent professional valuer. In determining the fair values, the valuer has made reference to both the comparable sales transactions as available in the relevant market of these properties and the capitalisation of the existing and reversionary rental income potential. The estimated value from capitalisation of the existing and reversionary rental income potential is used as an estimate of fair value, and the estimate is dependent on several variable parameters and projections including projected rental income, occupancy rate, rental yield, discount rate and terminal yield. Any change in the variable parameters and projections will result in change in fair value estimate for the investment properties which can potentially be significant. In relying on the independent professional valuation report, management considered the method of valuation and the Group s marketing strategy and is of the view that the estimated values are reasonable.

100 94 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (a) Categories of financial instruments The following table sets out the financial instruments as at the end of the reporting period: GROUP COMPANY RMB 000 RMB 000 RMB 000 RMB 000 Financial assets Fair value through profit or loss: Held-for-trading investment 19,510 Loans and receivables (including cash and cash equivalents) 24,207,375 19,861,783 14,161,536 12,471,824 Financial liabilities Put liability to acquire non-controlling interests 1,421,698 Derivative financial instruments: In designated hedge accounting relationships 145,236 Amortised cost 32,559,183 26,966,674 9,456,499 8,168,491 (b) Financial instruments subject to offsetting, enforceable master netting arrangements and similar agreements Financial assets Net amounts Gross amounts of financial Gross of recognised assets amounts of financial liabilities presented in recognised set off in the the statement financial statement of of financial Type of financial asset assets financial position position RMB 000 RMB 000 RMB 000 GROUP 2016 Non-trade amounts due from non-controlling shareholders of subsidiaries 2,501,635 (14,501) 2,487, Non-trade amounts due from non-controlling shareholders of subsidiaries 825,048 (180,306) 644,742

101 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (b) Financial instruments subject to offsetting, enforceable master netting arrangements and similar agreements (Cont d) Financial liabilities Net amounts Gross amounts of financial Gross of recognised liabilities amounts of financial assets presented in recognised set off in the the statement financial statement of of financial Type of financial liability liabilities financial position position RMB 000 RMB 000 RMB 000 GROUP 2016 Non-trade amounts due to non-controlling shareholders of subsidiaries 648,975 (14,501) 634, Non-trade amounts due to non-controlling shareholders of subsidiaries 337,475 (180,306) 157,169 In reconciling the Net amounts of financial assets and financial liabilities presented in the statement of financial position to the line item amounts presented in the statement of financial position, the above amounts represent only those which are subject to offsetting, enforceable master netting arrangements and similar agreements. The Group does not have any related amounts subject to enforceable master netting arrangements and similar arrangements which have not been set off in the statement of financial position. The Company does not have any financial instruments which are subject to offsetting, enforceable master netting arrangements or similar netting agreements. (c) Financial risk management policies and objectives The management of the Group monitors and manages the financial risks relating to the operations of the Group to ensure appropriate measures are implemented in a timely and effective manner. These risks include market risk (foreign exchange risk, interest rate risk, equity price risk), credit risk and liquidity risk. The Group uses derivative financial instruments to manage its exposure to foreign currency risk relating to its foreign currency denominated senior notes. The Group does not hold or issue derivative financial instruments for speculative purposes.

102 96 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) There has been no change to the Group s exposure to these financial risks or the manner in which it manages and measures the risks. Market risk exposures are measured using sensitivity analysis indicated below. (i) Foreign exchange risk management The Group enters into transactions in various foreign currencies, including the United States ( US ) dollar, Hong Kong ( HK ) dollar, Singapore ( SG ) dollar and Renminbi ( RMB ) and therefore is exposed to foreign exchange risk. At the end of the reporting period, the carrying amounts of monetary assets and monetary liabilities denominated in currencies other than the respective entities functional currencies are as follows: GROUP COMPANY Liabilities Assets Liabilities Assets RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 US dollar 884,964 3,377,822 1,240, , ,220 2,648, HK dollar 583,201 26,879 31,374 47, SG dollar 14,251,113 12,573,688 5,388,618 3,383,984 RMB 4,697,635 2,063, , , ,910 1, Further details on the derivative financial instruments are found in Note 17 to the financial statements. Foreign currency sensitivity The following table details the sensitivity to a 3% increase in the exchange rate of the functional currency of each entity of the Group against the relevant foreign currencies. 3% is the sensitivity rate used by key management personnel in assessing foreign currency risk and represents management s assessment of the possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year end for a 3% change in foreign currency rates. The sensitivity analysis includes external loans, cash and cash equivalents, held-for-trading investment, as well as intercompany loans within the Group where they gave rise to an impact on the Group s profit or loss and / or other equity. A positive number below indicates an increase in profit before income tax and other equity when the functional currency of each Group entity strengthens by 3% against the relevant foreign currencies.

103 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (i) Foreign exchange risk management (Cont d) For a 3% weakening of the functional currency of each Group entity against the relevant foreign currencies, there would be an equal and opposite impact on the profit before income tax and other equity. GROUP US dollar impact HK dollar impact SG dollar impact RMB impact RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 (Decrease) Increase in profit before income tax (1) (10,360) 83,916 16,073 (588) 3,212 3,229 76,738 (6,874) Increase in other equity 254, ,433 50,570 5,392 COMPANY Increase (Decrease) in profit before income tax 12,121 77,130 (2) (2) 23,183 (7) (1) In 2015, the impact excluded the foreign currency impact on RMB denominated senior notes due in 2016 as a result of the effects of adopting hedge accounting. (ii) Interest rate risk management Summary quantitative data of the Group s interest-bearing financial instruments can be found in Section (v) of this Note. The Group s policy is to obtain fixed rate borrowings to reduce volatility. However, it may borrow at variable rates when considered economical to do so. Interest rate sensitivity The sensitivity analysis below has been determined based on the exposure to interest rates for nonderivative instruments at the end of the reporting period and the stipulated change taking place at the beginning of the financial year and held constant throughout the reporting year in the case of instruments that have floating rates. A 100 basis point increase or decrease is used when assessing interest rate risk and represents the management s assessment of the possible change in interest rates.

104 98 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (ii) Interest rate risk management (Cont d) If interest rates had been 100 basis points higher or lower and all other variables were held constant, the Group s: Profit before income tax for the year ended December 31, 2016 would decrease / increase respectively by RMB114 million (2015 : decrease / increase respectively by RMB106 million). The Group s sensitivity to interest rates has increased during the current year due to the increase in the carrying amount of variable rate debt instruments. It is the Group s accounting policy to capitalise borrowing costs relevant to property development. Hence, the above mentioned interest rate fluctuation may not fully impact the profit in the year where interest expense is incurred and capitalised but may affect profit in future financial years. If interest rates had been 100 basis points higher or lower and all other variables were held constant, the Company s profit before income tax for the year ended December 31, 2016 would decrease / increase respectively by RMB21 million (2015 : decrease / increase respectively by RMB3 million). The Company s sensitivity to interest rates has increased during the current year due to the increase in variable rate debt instruments. (iii) Equity price risk management In 2015, the Group was exposed to equity price risk which arose from equity investment classified as held-for-trading, which was disposed during the current year. Further details of equity investments can be found in Note 19 to the financial statements. The management was of the view that the equity price risk was not significant for the Group due to the relatively small amount of such investments carried. Hence no price sensitivity analysis was presented.

105 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (iv) Credit risk management Credit risk refers to the risk that a counterparty may default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. For sales of properties, sales proceeds are fully settled concurrent with delivery of properties. The Group does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics except for non-trade amounts due from non-controlling shareholders of subsidiaries. Part of the amounts due from non-controlling interests are covered by undistributed retained earnings of the subsidiary yet to be distributed as dividends and future earnings that are expected to be distributed by the subsidiary to the non-controlling shareholders (Note 13). Information on credit risk relating to other receivables are disclosed in Note 14. The credit risk on cash and cash equivalents is limited because the counterparties are banks with high credit-ratings assigned by international credit rating agencies. The Group s maximum exposure to credit risk comprise (i) the sum of the carrying amounts of financial assets recorded in the financial statements, grossed up for any allowances for losses; and (ii) credit risk relating to guarantees of approximately RMB billion (2015 : RMB7.577 billion) to banks for the benefit of the Group s customers in respect of mortgage loans provided by the banks to these customers for the purchase of the Group s development properties, as elaborated in Note 40 to the financial statements. (v) Liquidity risk management The Group maintains cash and cash equivalents, obtains external bank and other borrowings and issues senior notes with staggered repayment dates. The Group also minimises liquidity risk by keeping committed credit lines available. At December 31, 2016, the Group had available RMB9.571 billion (2015 : RMB7.124 billion) of undrawn committed bank and other credit facilities in respect of which all precedent conditions had been met. In managing liquidity risk, the management prepares cash flow forecasts using various assumptions and monitors the cash flows of the Group.

106 100 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (v) Liquidity risk management (Cont d) Liquidity and interest risk analyses Non-derivative financial liabilities The following tables detail the remaining contractual maturity for non-derivative financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group and Company can be required to pay. The table includes both interest and principal cash flows. The adjustment column represents the estimated future interest attributable to the instrument included in the maturity analysis which is not included in the carrying amount of the financial liabilities on the statement of financial position. GROUP 2016 Weighted On average demand More than More than effective or within 1 year to 2 years to More than interest rate 1 year 2 years 5 years 5 years Adjustments Total % RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 Non-interest bearing 8,681,336 1,421,698 10,103,034 Variable interest rate instruments 4.3 4,518,273 2,050,927 4,430,310 1,752,267 (1,399,794) 11,351,983 Fixed interest rate instruments 6.1 7,103,215 1,517,874 5,189,915 (1,285,140) 12,525,864 Total 20,302,824 3,568,801 11,041,923 1,752,267 (2,684,934) 33,980, Non-interest bearing 8,674,986 8,674,986 Variable interest rate instruments 5.3 3,503,486 3,694,800 3,119,380 1,655,170 (1,453,949) 10,518,887 Fixed interest rate instruments 8.0 3,046,906 2,867,120 2,859,275 (1,000,500) 7,772,801 Total 15,225,378 6,561,920 5,978,655 1,655,170 (2,454,449) 26,966,674

107 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (v) Liquidity risk management (Cont d) In 2016, the maximum amount that the Group could be obliged to settle under the financial guarantee contracts related to bank loans of buyers is RMB billion (2015 : RMB7.577 billion) (Note 40). The earliest period that the guarantees could be called is within 1 year (2015 : 1 year) from the end of the reporting period. As mentioned in Note 40, the management considers that the likelihood of these guarantees being called upon is low. In 2016, the maximum contingent amount that the Company could be obliged to settle under the financial guarantee contracts related to senior notes issued by a subsidiary, loan facilities granted to subsidiaries and an interest-free current advance to a subsidiary is RMB6.203 billion (2015 : RMB7.400 billion) (Note 40). Out of the maximum contingent amount of RMB6.203 billion (2015 : RMB7.400 billion), RMB3.989 billion (2015 : RMB5.475 billion) is jointly guaranteed by the Company and five of its subsidiaries. The earliest period that the guarantees could be called is within 1 year (2015 : 1 year) from the end of the reporting period. COMPANY 2016 Weighted On average demand More than More than effective or within 1 year to 2 years to interest rate 1 year 2 years 5 years Adjustments Total % RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 Non-interest bearing 5,450,785 5,450,785 Variable interest rate instruments 3.4 1,192, , ,584 (147,607) 2,089,405 Fixed interest rate instruments 6.8 1,968,433 (52,124) 1,916,309 Total 8,612, , ,584 (199,731) 9,456, Non-interest bearing 3,502,405 3,502,405 Variable interest rate instruments , ,628 (43,794) 264,894 Fixed interest rate instruments ,311 2,131,091 2,649,575 (788,785) 4,401,192 Total 3,911,716 2,145,151 2,944,203 (832,579) 8,168,491

108 102 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (v) Liquidity risk management (Cont d) Non-derivative financial assets The following tables detail the expected maturity for non-derivative financial assets. The tables below have been drawn up based on the undiscounted contractual maturities of the financial assets including interest that will be earned on those assets except where the Group and the Company anticipate that the cash flows will occur in a different period. GROUP 2016 Weighted On average demand More than More than effective or within 1 year to 2 years to More than interest rate 1 year 2 years 5 years 5 years Adjustments Total % RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 Non-interest bearing 18,293,113 52, ,796 18,952,895 Fixed interest rate instruments 5.5 3,864, ,870 1,722,170 (564,335) 5,254,480 Total 22,157, ,856 2,328,966 (564,335) 24,207, Non-interest bearing 16,995, ,704 4,577 17,530,011 Fixed interest rate instruments 3.3 2,015, , ,691 (196,928) 2,351,282 Total 19,011, , ,268 (196,928) 19,881,293 In 2016 and 2015, the Company s non-derivative financial assets are mainly non-interest bearing with expected maturity within a year. Derivative financial instruments The Group s derivative financial liabilities in 2015 comprised cross currency swaps amounting to RMB145 million, which was derecognised upon redemption of senior note during the year.

109 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (vi) Fair value of financial assets and financial liabilities The Group determines fair values of various financial assets and financial liabilities in the following manner: Fair value of the Group s financial assets and financial liabilities that are measured at fair value on a recurring basis Some of the Group s financial assets and financial liabilities are measured at fair value at the end of each reporting period. The following table gives information about how the fair values of these financial assets and financial liabilities are determined. Relationship of Fair Valuation Significant unobservable Financial Fair value as at value technique(s) unobservable inputs to assets / (liabilities) hierarchy and key input(s) input(s) fair value RMB 000 RMB 000 GROUP Put liability to (1,421,698) Level 3 Discounted cash flow. Cost of debt A slight acquire noncontrolling interests with tenure of 2-3 years at 10% Future cash flows are estimated based on the present value of expected payment, discounted using the entity s cost of debt. The expected payment is determined by considering the fair value at the time of exit Held-for-trading 19,510 Level 1 Quoted bid prices N/A N/A investment in an active market Cross currency (145,236) Level 2 Discounted cash flow. N/A N/A swaps Future cash flows are estimated based on forward exchange rates (from observable forward exchange rates at the end of the reporting period) and contract forward rates, discounted at a rate that reflects the credit risk of various counterparties increase in the cost of debt used in isolation will result in a decrease in the fair value (1) (1) A 100 basis point increase / decrease in cost of debt used as discount rate while holding all other variables constant would decrease / increase the carrying amount of put liability to acquire non-controlling interests by RMB26 million (2015 : RMB Nil).

110 104 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (vi) Fair value of financial assets and financial liabilities (Cont d) The Company had no financial assets or liabilities carried at fair value in 2016 and There were no transfers between Level 1 and Level 2 of the fair value hierarchy in the period. Fair value of the Group s financial assets and financial liabilities that are not measured at fair value on a recurring basis (but fair value disclosures are required) Except as detailed in the following table, management considers that the carrying amounts of financial assets and financial liabilities of the Group and the Company recorded at amortised cost in the financial statements approximate their fair values: GROUP Carrying Fair Carrying Fair amount value amount value RMB 000 RMB 000 RMB 000 RMB 000 Financial Liabilities Senior notes 1,916,309 1,941,494 6,268,301 6,443,632 COMPANY Financial Liabilities Senior notes 1,916,309 1,941,494 4,401,192 4,577,249 GROUP 2016 Fair value hierarchy Level 1 Level 2 Level 3 Total RMB 000 RMB 000 RMB 000 RMB 000 Financial Liabilities Senior notes 1,941,494 1,941, Financial Liabilities Senior notes 6,443,632 6,443,632

111 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISK MANAGEMENT (Cont d) (c) Financial risk management policies and objectives (Cont d) (vi) Fair value of financial assets and financial liabilities (Cont d) Fair value hierarchy Level 1 Level 2 Level 3 Total RMB 000 RMB 000 RMB 000 RMB 000 COMPANY 2016 Financial Liabilities Senior notes 1,941,494 1,941, Financial Liabilities Senior notes 4,577,249 4,577,249 (d) Capital risk management policies and objectives The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximising the return to shareholders through the optimisation of the debt and equity balance. The Group monitors capital on the basis of the net debt to equity ratio. This ratio is calculated as total debt less cash and cash equivalents divided by equity. Total debt include bank and other borrowings, senior notes and certain non-trade amounts due to non-controlling shareholders of subsidiaries and ultimate holding company. Equity for this purpose comprises equity attributable to owners of the Company, comprising issued capital, reserves and accumulated profits, as well as non-controlling interests as shown in the consolidated statement of financial position. The net debt to equity ratios as at December 31, 2016 and 2015 were as follows: GROUP RMB 000 RMB 000 Total debt 23,675,021 18,387,793 Cash and cash equivalents (17,583,383) (17,516,991) Net debt 6,091, ,802 Equity 30,009,556 30,534,454 Net debt to equity ratio 20.3% 2.9% The Group s overall strategy remains unchanged from In addition, the Group also specifically monitors the financial ratios of its debt covenants stated in the agreements in respect of senior notes issued by the Company and its subsidiary and borrowings with the financial institutions providing the facilities to the Group.

112 106 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, ULTIMATE HOLDING COMPANY AND RELATED COMPANY TRANSACTIONS The Company is a subsidiary of Yanlord Holdings Pte. Ltd., incorporated in the Republic of Singapore, which is also the Company s ultimate holding company. Related companies in these financial statements refer to members of the ultimate holding company s group of companies. Transactions between the Company and its subsidiaries, which are related companies of the Company, have been eliminated on consolidation and are not disclosed in this note. The intercompany balances are unsecured, interestfree and repayable on demand unless otherwise stated. During the year, the Group and the Company entered into the following transactions with its ultimate holding company: GROUP AND COMPANY RMB 000 RMB 000 Interest expense to ultimate holding company (Note 30) 560 1,883 Non-trade amount due to the ultimate holding company amounting to RMB422 million and RMB250 million (2015 : RMB Nil) bears floating interest rates at the Bank s cost of funds or SWAP offer rate plus 1.5% per annum, and the Bank s cost of funds or SWAP offer rate plus 1.1% per annum respectively. The balances are unsecured and repayable on demand. 6 OTHER RELATED PARTY TRANSACTIONS Some of the Group s transactions and arrangements are with related parties and the effect of these on the basis determined between the parties is reflected in these financial statements. The balances with related parties are unsecured, interest-free and repayable on demand unless otherwise stated. During the year, the Group entered into the following transactions with related parties: GROUP RMB 000 RMB 000 Sale of properties to key management personnel and close members of their families (15,421) (69,423) Interest income from associates (27,067) Interest income from joint ventures (50,805) (17,437) Other income from an associate (18) Other income from joint ventures (7,958) (4,548) Rental expenses to a director and a company in which the director has control over 9,855 9,292

113 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT OTHER RELATED PARTY TRANSACTIONS (Cont d) At the end of the reporting period, the Group has outstanding commitments of RMB13 million (2015 : RMB22 million) to a director and a company in which the director has control over, under non-cancellable operating leases in respect of land and buildings for its office premises and staff accommodation. As at December 31, 2015, the Group had contracted with a joint venture for future minimum lease receipts of RMB1 million. The lease with a joint venture has expired during the year. At the end of the reporting period, the Group has pre-sales of properties totaling RMB47 million (2015 : RMB19 million) to key management and close members of their families. As at December 31, 2016, advances amounting to RMB Nil (2015 : RMB50,000) and RMB47 million (2015 : RMB9 million) have been received from a director as well as key management and close members of their families respectively in relation to the pre-sales of properties. As at December 31, 2016, a bank loan of the Company amounting to RMB203 million (2015 : RMB265 million) drawn for general working capital of the Group is secured by a legal charge extended by the Company s ultimate holding company and a personal guarantee from a director. Compensation of directors and key management personnel The remuneration of directors and other members of key management during the year was as follows: GROUP RMB 000 RMB 000 Short-term benefits 81,444 54,815 Post-employment benefits ,434 55,672

114 108 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, PROPERTY, PLANT AND EQUIPMENT GROUP Leasehold Furniture, land and Motor fixtures and Constructionbuildings vehicles equipment in-progress Total RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 Cost: At January 1, ,001 77, , ,996 1,262,653 Additions 13,748 6,608 11, , ,694 Transfer from properties under development for sale 19,512 19,512 Disposals (6,749) (1,595) (8,344) Exchange difference At December 31, ,261 77, ,236 1,211,617 1,784,574 Additions 4,720 6,487 11, , ,911 Transfer to properties under development for sale (61,889) (61,889) Disposals (15,671) (1,626) (4,201) (21,498) Acquisition of a subsidiary (Note 36) Change of control as subsidiaries to associates (Note 37) (1,797) (2,613) (4,410) Exchange difference At December 31, ,310 80, ,888 1,510,020 2,079,769 Accumulated depreciation: At January 1, ,485 52, , ,163 Depreciation for the year 13,761 7,798 15,657 37,216 Eliminated on disposals (5,955) (1,445) (7,400) Exchange difference At December 31, ,246 53, , ,027 Depreciation for the year 11,813 7,718 14,744 34,275 Eliminated on disposals (1,662) (1,368) (3,632) (6,662) Change of control as subsidiaries to associates (Note 37) (1,103) (1,296) (2,399) Exchange difference At December 31, ,397 59, , ,302 Carrying amount: At end of year 255,913 21,399 32,135 1,510,020 1,819,467 At beginning of year 277,015 23,583 37,332 1,211,617 1,549,547 In 2016, depreciation for the year includes an amount of RMB2 million (2015 : RMB2 million) capitalised in the Group s properties for development and properties under development for sale. The carrying amount of construction-inprogress pledged to banks and other lenders to secure bank and other borrowings is disclosed in Note 24.

115 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INVESTMENT PROPERTIES GROUP RMB 000 RMB 000 At fair value: Balance as at beginning of year 11,566,890 10,244,250 Additions 1,608, ,367 Transfer from properties under development for sale 50, ,535 Transfer from completed properties for sale 134,777 16,504 Change in fair value (Notes 29 and 32) 366, ,865 Disposals (32,348) (44,631) Balance as at end of year 13,694,556 11,566,890 These include the following related to investment properties classified under Level 3 of the fair value hierarchy: Gain from fair value adjustment included in profit or loss 366, ,865 The fair value of investment properties at December 31, 2016 and 2015 have been determined on the basis of valuations carried out at the respective year end dates by an independent valuer having recognised professional qualification and recent experience in the location and category of the properties being valued, and not related to the Group. The fair value was determined based on the direct comparison approach that reflects recent transaction prices or current asking prices for similar properties, the income capitalisation approach where the market rentals of all lettable units of the properties are assessed by reference to the rentals achieved in the lettable units as well as other lettings of similar properties in the neighbourhood and the residual approach whereby the fair value is determined by taking into consideration the projected total development value, costs incurred, expected cost to completion and developer s profit. The capitalisation rate adopted is made by reference to the yield rates observed by the valuers for similar properties in the locality and adjusted based on the valuers knowledge of the factors specific to the respective properties. In estimating the fair value of the properties, the highest and best use of the properties is their current use. There has been no change to the valuation technique during the year. Details of the Group s investment properties and information about the fair value hierarchy as at December 31, 2016 and 2015 are as follows: Fair value as at Level 1 Level 2 Level 3 December 31 RMB 000 RMB 000 RMB 000 RMB 000 GROUP 2016 Investment properties located in the PRC 13,694,556 13,694, Investment properties located in the PRC 11,566,890 11,566,890

116 110 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INVESTMENT PROPERTIES (Cont d) There were no transfers between the respective levels during the year. The following table shows the significant unobservable inputs used in the valuation model: Fair value as at December 31 Valuation Significant Description RMB 000 technique(s) unobservable input(s) Range 2016 Completed investment 11,404,700 (1) Direct comparison price per RMB14,643 RMB47,543 properties approach square meter (2) Income market rent per RMB30 RMB412 capitalisation square meter per approach month (2) capitalisation rate (3) 3.8% 9.0% Car parking spaces 551,856 Direct comparison price per unit (2) RMB66,190 RMB256,000 approach Investment properties 1,738,000 Residual approach price per RMB27,053 RMB42,184 under construction square meter (2) 2015 Completed investment 9,188,300 (1) Direct comparison price per RMB15,058 RMB46,463 properties approach square meter (2) Income market rent per RMB30 RMB419 capitalisation square meter per approach month (2) capitalisation rate (3) 5.8% 12.0% Car parking spaces 404,590 Direct comparison price per unit (2) RMB64,672 RMB256,000 approach Investment properties 1,974,000 Residual approach price per RMB26,112 RMB38,842 under construction square meter (2) (1) Out of the completed investment properties, some of the properties were based on either the Direct Comparison Approach ( DCA ), or the Income Capitalisation Approach ( ICA ), and the other properties were based on the combined approach of DCA and ICA. (2) Any significant isolated increases (decreases) in these inputs would result in a significantly higher (lower) fair value measurement. (3) Any significant isolated increases (decreases) in these inputs would result in a significantly lower (higher) fair value measurement.

117 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INVESTMENT PROPERTIES (Cont d) The carrying amounts of investment properties pledged to banks to secure the bank and other borrowings granted to the Group are disclosed in Note 24. The rental income earned by the Group from its investment properties amounted to RMB330 million (2015 : RMB369 million). Direct operating expenses arising on the investment properties in the year amounted to RMB4 million (2015 : RMB5 million). 9 PROPERTIES FOR DEVELOPMENT / COMPLETED PROPERTIES FOR SALE / PROPERTIES UNDER DEVELOPMENT FOR SALE GROUP RMB 000 RMB 000 At cost: Properties for development (Non-current assets) 2,792,938 4,115,661 Completed properties for sale (Current assets) 4,704,316 7,269,346 Properties under development for sale (Current assets) 38,214,800 31,287,170 45,712,054 42,672,177 Properties for development, completed properties for sale and properties under development for sale are located in the PRC. Up to the end of the reporting period, total interest capitalised is as follows: GROUP RMB 000 RMB 000 Properties for development 301, ,171 Completed properties for sale 269, ,207 Properties under development for sale 2,100,562 2,227,690 The carrying amounts of properties pledged to banks and other lenders to secure bank and other borrowings granted to the Group are disclosed in Note INVESTMENTS IN SUBSIDIARIES COMPANY RMB 000 RMB 000 Unquoted equity shares, at cost 2,473,274 2,364,026

118 112 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INVESTMENTS IN SUBSIDIARIES (Cont d) Details of the Company s significant subsidiaries are as follows: Name of subsidiary Country of incorporation (or residence) Proportion of ownership interest and voting power held % % Principal activities Held by the Company Yanlord Commercial Property Investments Pte. Ltd. (a) Singapore Investment holding 仁恒商业地产投资有限公司 Yanlord Land Pte. Ltd. (a) Singapore Investment holding 仁恒置地有限公司 Yanlord Land (HK) Co., Ltd. (b) Hong Kong Management service 仁恒地产 ( 香港 ) 有限公司 Held by Yanlord Land Pte. Ltd. and its subsidiaries Palovale Pte Ltd (a) Singapore Investment holding 柏龙威有限公司 Yanlord Property Pte. Ltd. (a) Singapore Investment holding 仁恒地产有限公司 Yanlord Real Estate Pte. Ltd. (a) Singapore Investment holding 仁恒置业发展有限公司 East Hero Investment Ltd. (b) Hong Kong Investment holding 东亨投资有限公司 Successful Global Consultancy Co., Ltd. (b) Hong Kong Management service 成顺环球咨询有限公司 Chengdu Everrising Asset Management Co., Ltd. (b) PRC Property development 成都市恒业东升资产经营管理有限公司 and investment Chengdu Yanlord Investment Management Co., Ltd. (b) PRC Management service 成都仁恒投资管理有限公司 and investment Chengdu Yanlord Property Management Co., Ltd. (b) PRC Property management 成都仁恒物业管理有限公司 Xinfu Trade (Chengdu) Co., Ltd. (b) PRC Investment holding 信富商贸 ( 成都 ) 有限公司

119 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INVESTMENTS IN SUBSIDIARIES (Cont d) Name of subsidiary Country of incorporation (or residence) Proportion of ownership interest and voting power held % % Principal activities Held by Yanlord Land Pte. Ltd. and its subsidiaries Yanlord Hotel Management (Chengdu) Co., Ltd. (b) PRC Hotel and serviced 仁恒酒店管理 ( 成都 ) 有限公司 apartment management Yanlord Land (Chengdu) Co., Ltd. (b) PRC Property development 仁恒置地 ( 成都 ) 有限公司 Yanlord Real Estate (Chengdu) Co., Ltd. (b) PRC Property development 仁恒置业 ( 成都 ) 有限公司 and management Guiyang Yanlord Property Management Co., Ltd. (b) PRC Property management 貴阳仁恒物业管理有限公司 Sino-Singapore Yanlord (Haimen) PRC 55 Investment holding (1) (b) Yangtze Eco Hi-Tech City Co., Ltd. 中新仁恒 ( 海门 ) 长江生态科技城有限公司 Sino-Singapore Yanlord Haimen Yangtze Eco Hi-Tech PRC 55 Property development (1) (b) City Investment and Development Co., Ltd. 中新仁恒海门长江生态科技城投资发展有限公司 Lhasa Xinfu Trading Co., Ltd. (b) PRC Trading of building 拉萨信富商贸有限公司 materials and hardware Nanjing Daji Real Estate Development Co., Ltd. (2) (b) PRC 51 Property development 南京大吉房地产开发有限公司 Nanjing Renyuan Investment Co., Ltd. (b) PRC Management service 南京仁远投资有限公司 and investment Nanjing Yanlord Commercial Management Co., Ltd. (b) PRC Property development 南京仁恒商业管理有限公司 and investment Nanjing Yanlord Cultural Tourism PRC Tourism investment (3) (b) Industry Development Co., Ltd. and asset management 南京仁恒文化旅游产业发展有限公司 Nanjing Yanlord Hotel Management Co., Ltd. (b) PRC Hotel and serviced 南京仁恒酒店管理有限公司 apartment management Nanjing Yanlord Jiangdao Real Estate Co., Ltd. (4) (b) PRC 100 Property development 南京仁恒江岛置业有限公司

120 114 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INVESTMENTS IN SUBSIDIARIES (Cont d) Name of subsidiary Country of incorporation (or residence) Proportion of ownership interest and voting power held % % Principal activities Held by Yanlord Land Pte. Ltd. and its subsidiaries Nanjing Yanlord Jiangzhou Property Development PRC Property development Co., Ltd. (b) and management 南京仁恒江洲房地产开发有限公司 Nanjing Yanlord Property Management Co., Ltd. (b) PRC Property management 南京仁恒物业管理有限公司 Nanjing Yanlord Real Estate Co., Ltd. (b) PRC Property development 南京仁恒置业有限公司 Nanjing Yu Dian Landscape Development Co., Ltd. (b) PRC Landscaping and 南京御典园林发展有限公司 gardening Yanlord Investment (Nanjing) Co., Ltd. (b) PRC Investment holding 仁恒投资 ( 南京 ) 有限公司 Yanlord Land (Nantong) Co., Ltd. (b) PRC Property development 仁恒置地 ( 南通 ) 有限公司 Shenzhen Hengming Commercial Co., Ltd. (2) (b) PRC 100 Property development 深圳市恒明商业有限公司 Shenzhen Huarong Innovation Investment Co., Ltd. (2) (b) PRC 100 Property development 深圳市华融创新投资股份有限公司 Shenzhen Long Wei Xin Investment Co., Ltd. (b) PRC Property development 深圳市龙威信投资实业有限公司 Shenzhen Yanlord Property Management Co., Ltd. (b) PRC Property management 深圳市仁恒物业管理有限公司 Yanlord Land (Shenzhen) Co., Ltd. (b) PRC Property development 仁恒置地 ( 深圳 ) 有限公司 and management Yanlord (Shenzhen) Hotel Management Co., Ltd. (4) (b) PRC 100 Hotel Management 仁恒 ( 深圳 ) 酒店管理有限公司 Yanlord (Shenzhen) Investment Management Co., Ltd. (2) (b) PRC 100 Investment holding 仁恒 ( 深圳 ) 投资实业有限公司

121 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INVESTMENTS IN SUBSIDIARIES (Cont d) Name of subsidiary Country of incorporation (or residence) Proportion of ownership interest and voting power held % % Principal activities Held by Yanlord Land Pte. Ltd. and its subsidiaries Shanghai Gusheng Construction Intelligent PRC Construction engineering Engineering Co., Ltd. (b) 上海固盛建筑智能化工程有限公司 Shanghai Hong Ming Ge Food & Beverage Service PRC Restaurant operation Management Co., Ltd. (b) 上海宏名阁餐饮服务管理有限公司 Shanghai Pudong New District Private PRC Kindergarten operation (5) (b) Yanlord Kindergarten 上海市浦东新区民办仁恒幼儿园 Shanghai Renan Property Development Co., Ltd. (4) (b) PRC 100 Property development 上海仁安房地产开发有限公司 Shanghai Renjie Hebin Garden Property Co., Ltd. (b) PRC Property development 上海仁杰河滨园房地产有限公司 Shanghai Renpin Property Development Co., Ltd. (6) (b) PRC Property development 上海仁品房地产开发有限公司 and management Shanghai Yanlord Education Training Co., Ltd. (4) (b) PRC 100 Education and training 上海仁恒教育培训有限公司 Shanghai Yanlord Elevator Co., Ltd. (b) PRC Sale, installation, repair 上海仁恒电梯有限公司 and maintenance of elevators Shanghai Yanlord Gaoqiao Property Co., Ltd. (5) (b) PRC Property development 上海仁恒高乔房地产有限公司 Shanghai Yanlord Hongqiao Property Co., Ltd. (b) PRC Property development 上海仁恒虹桥房地产有限公司 and management Shanghai Yanlord Industrial Development Co., Ltd. (4) (b) PRC 100 Management service 上海仁恒实业发展有限公司 and investment Shanghai Yanlord Investment Management Co., Ltd. (b) PRC Management service 上海仁恒投资管理有限公司 and investment

122 116 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INVESTMENTS IN SUBSIDIARIES (Cont d) Name of subsidiary Country of incorporation (or residence) Proportion of ownership interest and voting power held % % Principal activities Held by Yanlord Land Pte. Ltd. and its subsidiaries Shanghai Yanlord Property Co., Ltd. (b) PRC Property development 上海仁恒房地产有限公司 Shanghai Yanlord Property Management Co., Ltd. (b) PRC Property management 上海仁恒物业管理有限公司 Shanghai Yanlord Real Estate Co., Ltd. (b) PRC Property development 上海仁恒置业发展有限公司 Shanghai Yanlord Senlan Real Estate Co., Ltd. (b) PRC Property development 上海仁恒森兰置业有限公司 Shanghai Yanlord Xing Tang Real Estate Co., Ltd. (b) PRC Property development 上海仁恒兴唐置业有限公司 and management Shanghai Yanlord Yangpu Property Co., Ltd. (b) PRC Property development 上海仁恒杨浦房地产有限公司 Shanghai Zhongting Property Development Co., Ltd. (b) PRC Property development 上海中庭房地产开发有限公司 Yanlord Equity Investment Management (Shanghai) PRC Investment management Co., Ltd. (b) 仁恒股权投资管理 ( 上海 ) 有限公司 Yanlord Land Investment Management (Shanghai) PRC Management service Co., Ltd. (b) 仁恒置地投资管理 ( 上海 ) 有限公司 Yanlord Property Service Management (China) Co., Ltd. (b) PRC Property and investment 仁恒物业服务管理 ( 中国 ) 有限公司 management Sanya Yanlord Real Estate Co., Ltd. (b) PRC Property development 三亚仁恒置业有限公司 and management Sanya Yanlord Travel Service Co., Ltd. (4) (b) PRC 100 Tourism and travel 三亚仁恒旅行社有限公司 services Suzhou Peninsula Yanlord Real Estate Co., Ltd. (4) (b) PRC 100 Property development 苏州星岛仁恒置业有限公司

123 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INVESTMENTS IN SUBSIDIARIES (Cont d) Name of subsidiary Country of incorporation (or residence) Proportion of ownership interest and voting power held % % Principal activities Held by Yanlord Land Pte. Ltd. and its subsidiaries Suzhou Renan Real Estate Co., Ltd. (2) (6) (b) PRC 30 Property development 苏州仁安置业有限公司 Suzhou Renyuan Real Estate Co., Ltd. (4) (b) PRC 100 Property development 苏州仁远置业有限公司 Suzhou Yinghan Property Development Co., Ltd. (b) PRC Property development 苏州鹰汉房地产开发有限公司 Suzhou Zhonghui Property Development Co., Ltd. (b) PRC Property development 苏州中辉房地产开发有限公司 Yanlord Property Development (Suzhou) Co., Ltd. (b) PRC Property development 仁恒置业 ( 苏州 ) 有限公司 and management Yanlord Property (Suzhou) Co., Ltd. (b) PRC Property development 仁恒地产 ( 苏州 ) 有限公司 Tangshan Yanlord Property Management Co., Ltd. (b) PRC Property management 唐山仁恒物业服务有限公司 Tianjin Yanlord Beiyang Real Estate Co., Ltd. (b) PRC Property development 天津仁恒北洋置业有限公司 and management Tianjin Yanlord Fitness Services Co., Ltd. (4) (b) PRC 100 Leisure and fitness 天津仁恒健身服务有限公司 Tianjin Yanlord Garden Co., Ltd. (b) PRC Landscaping and 天津仁恒园林有限公司 gardening Tianjin Yanlord Haihe Development Co., Ltd. (b) PRC Property development 天津仁恒海河开发有限公司 Tianjin Yanlord Hehai Real Estate Co., Ltd. (4) (b) PRC 100 Property development 天津仁恒和海置业有限公司 Tianjin Yanlord Property Management Co., Ltd. (b) PRC Property management 天津仁恒物业服务有限公司

124 118 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INVESTMENTS IN SUBSIDIARIES (Cont d) Name of subsidiary Country of incorporation (or residence) Proportion of ownership interest and voting power held % % Principal activities Held by Yanlord Land Pte. Ltd. and its subsidiaries Yanlord Development (Tianjin) Co., Ltd. (b) PRC Property development 仁恒发展 ( 天津 ) 有限公司 Zhuhai Renyuan Investment Co., Ltd. (4) (b) PRC 90 Management service 珠海仁远投资有限公司 and investment Zhuhai Renyuan Land Co., Ltd. (4) (b) PRC 100 Property development 珠海市仁远置地有限公司 Zhuhai Yanlord Commercial Operation and PRC Management service Management Co., Ltd. (b) and investment 珠海仁恒商业经营管理有限公司 Zhuhai Yanlord Heyou Land Co., Ltd. (b) PRC Property development 珠海仁恒和由置地有限公司 and management Zhuhai Yanlord Industrial Ltd. (b) PRC Property development 珠海仁恒实业有限公司 Zhuhai Yanlord Property Management Co., Ltd. (b) PRC Property management 珠海仁恒物业管理有限公司 Zhuhai Yanlord Real Estate Development Co., Ltd. (b) PRC Property development 珠海仁恒置业发展有限公司 Zhongshan Renyuan Investment Co., Ltd. (2) (b) PRC 100 Investment holding 中山仁远投资有限公司 Zhongshan Renyuan Real Estate Co., Ltd. (2) (b) PRC 100 Investment holding 中山仁远置业有限公司 (1) As a result of change of articles of association, the Group lost control and reclassified the entities from subsidiaries to associates during the year (Note 37). (2) Acquired during the year (Note 36). (3) Formerly known as Nanjing Yanlord Tourism Development Co., Ltd. 南京仁恒旅游发展有限公司. (4) Incorporated during the year. (5) The proportion of ownership interest and voting power held by the Group is 50.2%. (6) Although the Group does not effectively own more than 50% of the equity shares of these entities, it has sufficiently dominant voting right and power to direct the relevant activities of these entities and therefore the Group has unilateral control over these entities and hence regards these entities as subsidiaries. Notes on auditors (a) Audited by Deloitte & Touche LLP, Singapore. (b) Audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP, Shanghai, PRC for consolidation purposes.

125 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INVESTMENTS IN SUBSIDIARIES (Cont d) The following schedule shows the effects of changes in the group s ownership interest in a subsidiary that did not result in change of control, on the equity attributable to owners of the parent: GROUP RMB 000 RMB 000 Amount paid on change of interest in a subsidiary 2,500 Non-controlling interests acquired (2,397) (34) Difference recognised in other reserve 103 (34) Details of non wholly-owned subsidiaries that have material non-controlling interests to the Group are disclosed below: Name of subsidiary Place of incorporation and principal place of business Proportion of ownership interest and voting rights held by non-controlling interests Profit attributable to non-controlling interests Accumulated non-controlling interests % % RMB'000 RMB'000 RMB'000 RMB'000 Nanjing Yanlord Real Estate Co., Ltd. 南京仁恒置业有限公司 PRC , , ,140 1,025,408 Shanghai Yanlord Hongqiao Property Co., Ltd. 上海仁恒虹桥房地产有限公司 PRC , ,304 (1) 1,760,586 1,620,305 (1) Shanghai Yanlord Senlan Real Estate Co., Ltd. 上海仁恒森兰置业有限公司 PRC ,718 (2) 224,942 1,022,438 (2) 1,535,926 Individually immaterial subsidiaries with non-controlling interests 360, ,832 5,277,598 6,017,746 1,279, ,884 8,962,762 10,199,385 (1) Represents comparative figures of 2016 for non wholly-owned subsidiary that has material non-controlling interest to the Group in the current year. (2) Represents comparative figures of 2015 for non wholly-owned subsidiary that has material non-controlling interest to the Group in the prior year.

126 120 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INVESTMENTS IN SUBSIDIARIES (Cont d) Summarised financial information in respect of each of the Group s subsidiaries that has material non-controlling interests is set out below. The summarised financial information below represents amounts before intragroup eliminations. Nanjing Yanlord Real Shanghai Yanlord Hongqiao Shanghai Yanlord Senlan Estate Co., Ltd. Property Co., Ltd. Real Estate Co., Ltd. 南京仁恒置业有限公司 上海仁恒虹桥房地产有限公司 上海仁恒森兰置业有限公司 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 Non-current assets 3,901 4,874 43, , ,379 Current assets 6,590,099 6,824,173 6,266,416 6,454,037 3,011,131 4,421,655 Non-current liabilities (3,366) (3,016) Current liabilities (4,338,650) (4,265,528) (1,908,276) (2,404,151) (779,042) (953,204) Total equity 2,255,350 2,563,519 4,401,466 4,050,763 2,556,096 3,839,814 Equity attributable to: Owners of the Company 1,353,210 1,538,111 2,640,880 2,430,458 1,533,658 2,303,888 Non-controlling interests 902,140 1,025,408 1,760,586 1,620,305 1,022,438 1,535,926 Revenue 4,303,934 1,893,104 2,274,444 1,900,006 2,009,066 2,989,807 Profit for the year, representing total comprehensive income for the year 1,401, , , , , ,356 Total comprehensive income attributable to: Owners of the Company 841, , , , , ,414 Non-controlling interests 560, , , , , ,942 Net cash inflow (outflow) from: Operating activities 2,373,924 2,257,018 2,160,647 1,953,132 1,581,627 2,167,918 Investing activities (2,627,016) 614,409 (821,796) (660,284) (1,723,455) 23,688 Financing activities (1) (1,709,926) (909,903) (1,358,116) (17,000) (1,731,205) (711,063) Net cash (outflow) inflow (1,963,018) 1,961,524 (19,265) 1,275,848 (1,873,033) 1,480,543 (1) Including dividend paid to noncontrolling interests (207,295) (194,204)

127 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INVESTMENTS IN ASSOCIATES GROUP RMB 000 RMB 000 Cost of investments in associates 630,076 2,441 Share of post-acquisition loss (14,231) (2,441) Group s share of unrealised income from associates (5,482) 610,363 Non-trade amount due from associates (Current assets) (Note 6) 1,176, Aggregate information of the Group s associates that are not individually material The Group s share of the associates loss from continuing operations and total comprehensive income for the year are RMB12 million (2015 : RMB Nil). The Group discontinues recognising further losses when the Group s share of loss of associates exceeds its interest in the associates. The Group s share of unrecognised losses of an associate for the financial year and the accumulated losses at the end of the reporting period amounted to RMB298,000 (2015 : RMB17,000) and RMB403,000 (2015 : RMB105,000) respectively. The aggregate carrying amount of the Group s interests in associates as at December 31, 2016 and 2015 is RMB610 million and RMB Nil respectively. 12 INVESTMENTS IN JOINT VENTURES GROUP RMB 000 RMB 000 Cost of investments in joint ventures 1,006, ,433 Deemed investment in a joint venture 113, ,847 Share of post-acquisition profit 80,363 73,264 1,200,199 1,093,544 Non-trade amounts due from joint ventures Non-current assets (Note 6) Current assets (Note 6) 1,202, , ,372 Amounts due from joint ventures are interest-free, unsecured and repayable on demand except for the following: a) Amount of RMB217 million (2015 : RMB Nil) which bears interest at 6.25% per annum, is unsecured and repayable within 5 years from the end of the reporting period. b) Amount of RMB197 million (2015 : RMB Nil) which bears interest at 9.00% per annum, is unsecured and repayable within 2 years from the end of the reporting period. c) Amount of RMB736 million (2015 : RMB Nil) which bears interest at 9.00% per annum, is unsecured and repayable within 3 years from the end of the reporting period. d) Amount of RMB200 million (2015 : RMB Nil) which bears interest at 9.00% per annum, is unsecured and repayable within 1 year from the end of the reporting period.

128 122 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INVESTMENTS IN JOINT VENTURES (Cont d) Aggregate information of the Group s joint ventures that are not individually material GROUP RMB 000 RMB 000 Group s share of profit (loss) from continuing operations, representing its share of total comprehensive income (expense) for the year 7,099 (29,260) Aggregate carrying amount of the Group s interests in these joint ventures 1,200,199 1,093, NON-TRADE AMOUNTS DUE FROM / TO NON-CONTROLLING SHAREHOLDERS OF SUBSIDIARIES Amounts due from non-controlling shareholders of subsidiaries are interest-free, unsecured and repayable on demand except for the following: a) Amounts of RMB60 million and RMB33 million (2015 : RMB53 million and RMB31 million) which bear interest at 5.0% and 4.4% per annum (2015 : 5.0% and 5.6% per annum) respectively and are secured by the noncontrolling shareholder s shares in a subsidiary and undistributed retained earnings of a subsidiary yet to be distributed as dividends to the non-controlling shareholder of that subsidiary. The amount is repayable on demand in 2016 and b) Amount of RMB253 million (2015 : RMB229 million) which bears interest at 10.6% per annum (2015 : 10.6% per annum), is secured by expected future earnings that will be distributed by a subsidiary to the non-controlling shareholders of that subsidiary and repayable on demand (2015 : repayable within 5 years). c) Amount of RMB200 million (2015 : RMB Nil) which bears interest at the People s Bank of China s benchmark rate upon repayment, unsecured and repayable within 4 years from the end of the reporting period. d) Amount of RMB150 million (2015 : RMB150 million) which bears interest at 7.0% per annum (2015 : 7.0% per annum), is unsecured and repayable within 1 year from the end of the reporting period (2015 : repayable within 2 years). e) As at December 31, 2015, amount of RMB4 million which was secured by expected future earnings that will be distributed by a subsidiary to the non-controlling shareholders of that subsidiary and repayable within 5 years from the end of the reporting period. f) Amount of RMB803 million (2015 : RMB Nil) which bears interest at the People s Bank of China s benchmark rate (2015 : Nil%), unsecured and repayable within 1 year from the end of the reporting period. As at December 31, 2016, current amounts due to non-controlling shareholders of subsidiaries are interest-free, unsecured and repayable on demand except for amount of RMB203 million which bears interest at 10.0% per annum. As at December 31, 2016, non-current amount due to a non-controlling shareholder of subsidiary is unsecured, bears interest at 10.0% per annum and repayable within 3 years from the end of the reporting period.

129 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT NON-TRADE AMOUNTS DUE FROM / TO NON-CONTROLLING SHAREHOLDERS OF SUBSIDIARIES (Cont d) As at December 31, 2015, current amounts due to non-controlling shareholders of subsidiaries are interest-free, unsecured and repayable on demand except for amount of RMB96 million which was guaranteed by the Company as well as amount of RMB30 million which bore interest at 4.6% per annum and repayable within 1 year from the end of the reporting period. 14 OTHER RECEIVABLES AND DEPOSITS GROUP COMPANY RMB 000 RMB 000 RMB 000 RMB 000 Advances to suppliers 86,901 11,892 Deposits for projects 3,871,844 1,590,711 Staff loans 11,708 14,727 Prepayments 5,998 11, Value added tax ( VAT ) prepayment 246,183 Sales-related tax prepayment 559, ,744 Interest receivables 11,511 Payments for resettlement (1) 600, ,704 Other receivables 394, ,797 5,777,088 3,149, Analysed as: Current 4,903,935 2,619, Non-current 873, ,704 5,777,088 3,149, (1) This relates to payments for resettlement of land parcel in Chengdu. The management considers the credit risk on other receivables and deposits to be limited because the counterparties are government agents or third parties with long business relationships with the Group. 15 INTANGIBLE ASSET GROUP RMB 000 RMB 000 Club membership At December 31, 2016 and 2015, the management assessed the marketable value of the club membership and determined that it was in excess of its carrying amount.

130 124 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, DEFERRED TAXATION GROUP RMB 000 RMB 000 Deferred tax assets 444, ,444 Deferred tax liabilities (2,243,610) (1,959,037) (1,799,549) (1,457,593) The following are the major deferred tax assets and liabilities recognised by the Group and movements thereon during the current and prior reporting year. GROUP Accelerated tax depreciation Unpaid Revaluation and excess of development of investment tax deductible Withholding costs and properties expenses tax Tax losses others Total RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 At January 1, 2015 (1,519,681) 42,769 (128,422) 224, ,951 (1,277,763) (Charge) Credit to profit or loss for the year (Note 31) (271,107) 41,795 (111,158) 88, (251,479) Transfer to income tax payable 71,331 71,331 Exchange difference At December 31, 2015 (1,790,788) 84,564 (168,249) 313, ,307 (1,457,593) (Charge) Credit to profit or loss for the year (Note 31) (134,861) 8,839 (227,457) (54,765) (1,910) (410,754) Transfer to (from) income tax payable 77,745 (6,374) 71,371 Change of control as subsidiaries to associates (190) (4,416) (4,606) Exchange difference 1,433 1,433 At December 31, 2016 (1,925,649) 93,213 (317,961) 249, ,397 (1,799,549) Pursuant to PRC and Hong Kong tax regulations, at the end of the reporting period, the Group has unutilised tax losses of RMB1.249 billion (2015 : RMB1.659 billion) available for offset against future profits. A deferred tax asset of RMB249 million (2015 : RMB314 million) has been recognised in respect of RMB1.042 billion (2015 : RMB1.301 billion) of such losses at the tax rates range from 15% to 25%. No deferred tax asset has been recognised in respect of the remaining RMB207 million (2015 : RMB358 million) due to the unpredictability of future profit streams. Tax losses may be carried forward for 5 years from the year after the losses are incurred, subject to the conditions imposed by law including the retention of majority shareholders as defined.

131 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT DERIVATIVE FINANCIAL INSTRUMENTS GROUP RMB 000 RMB 000 Cross currency swaps, designated in hedge accounting relationships (Current liability) 145,236 The Group used cross currency swaps to hedge the foreign currency risks arising from the interest and principal payments of its RMB denominated senior notes. Contracts with nominal values of RMB2 billion had fixed interest payments denominated in US dollars at 4.325% per annum and fixed interest receipts denominated in RMB at 5.375% per annum. All of the Group s cross currency swaps were designated and effective as cash flow hedges and the fair value gain of these cross currency swaps, amounting to RMB145 million (2015 : loss of RMB147 million) had been recognised in other comprehensive income. Amount of RMB109 million (2015 : RMB117 million) had been reclassified from equity to profit or loss during the year. The cross currency swaps were settled on a semi-annual basis and matured on May 23, All cross currency swap contracts exchanging RMB denominated interest and principal payments for US dollar denominated interest and principal payments were designated as cash flow hedges in order to reduce the Group s cash flow exposure resulting from the fluctuation of RMB against US dollar over the tenure of the senior notes. The cross currency swaps and the interest and principal payments on the senior notes occurred simultaneously and the amount recognised in other comprehensive income was reclassified from equity to profit or loss over the tenure of the senior notes. 18 PUT LIABILITY TO ACQUIRE NON-CONTROLLING INTERESTS This represents the fair value of the put liability to acquire non-controlling interests as part of the share purchase agreement of a subsidiary. As the earliest dates for the non-controlling shareholders to exercise the non-cancellable rights to put back their shares to the Group are expected be more than two years, the obligation is recorded herewith as non-current liabilities as at 31 December HELD-FOR-TRADING INVESTMENT GROUP RMB 000 RMB 000 Quoted equity security, at fair value 19,510 Held-for-trading investment presented the Group with opportunities for return through dividend income and fair value gains. This investment had no fixed maturity or coupon rate. The fair value of this security was based on the closing quoted market price on the last market day of the financial year. The held-for-trading investment was disposed during the current year.

132 126 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, PLEDGED BANK DEPOSITS AND CASH AND CASH EQUIVALENTS GROUP COMPANY RMB 000 RMB 000 RMB 000 RMB 000 Pledged bank deposits 520,680 51,367 Cash on hand 2,030 1, Cash at bank 17,002,320 15,936,988 21,885 10,657 Fixed deposits 579,033 1,578,145 Cash and cash equivalents 17,583,383 17,516,991 21,902 10,687 Pledged bank deposits represent deposits pledged to banks to secure the bank and other borrowings, certain mortgage loans provided by banks to customers for the purchase of the Group s development properties and as security for construction contracts required by the PRC local authority. 21 SHARE CAPITAL GROUP AND COMPANY RMB 000 RMB 000 Number of ordinary shares Issued and paid up: At beginning and end of year 1,948,736 1,948,736 7,261,726 7,261,726 Fully paid up ordinary shares, which have no par value, carry one vote per share and a right to dividends as and when declared by the Company. 22 TREASURY SHARES GROUP AND COMPANY RMB 000 RMB 000 Number of ordinary shares Repurchased during the year and at the end of the year 7,151 47,006 The Company acquired 7,150,600 (2015 : Nil) of its own shares through purchases on the Singapore Exchange during the year. The total amount paid to acquire the shares was RMB47 million and has been deducted from shareholders equity. The shares are held as treasury shares.

133 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT HEDGING RESERVE The hedging reserve represents hedging gains and losses recognised on the effective portion of cash flow hedges. The cumulative deferred gain or loss on the hedge recognised in other comprehensive income and accumulated in hedging reserves was reclassified to profit or loss when the hedged transaction impacts the profit or loss. Movement in hedging reserve: GROUP RMB 000 RMB 000 At January 1 (36,361) (7,094) Change in fair value of cross currency swaps 145,236 (146,662) Reclassification to profit or loss (108,875) 117,395 At December 31 (36,361) The full amount of hedging reserves was reclassified to profit or loss upon maturity of the cash flow hedge. 24 BANK AND OTHER BORROWINGS GROUP COMPANY RMB 000 RMB 000 RMB 000 RMB 000 The bank and other borrowings are repayable as follows: On demand or within one year 8,311,176 3,971, ,221 More than one year but not exceeding two years 3,252,987 3,991, ,545 12,644 More than two years but not exceeding five years 7,871,992 2,803, , ,250 More than five years 1,313,500 1,227,629 20,749,655 11,993,387 1,417, ,894 Less: Amount due for settlement within 12 months (shown under current liabilities) (8,311,176) (3,971,322) (495,221) Amount due for settlement after 12 months 12,438,479 8,022, , ,894 Secured: Current 3,612,220 3,238, ,220 Non-current 7,466,436 3,980,732 11,078,656 7,219, ,220 Unsecured: Current 4,698, ,692 79,001 Non-current 4,972,043 4,041, , ,894 9,670,999 4,774,025 1,001, ,894 20,749,655 11,993,387 1,417, ,894

134 128 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, BANK AND OTHER BORROWINGS (Cont d) The following assets are pledged for the above secured bank and other borrowings and undrawn loan facilities: GROUP RMB 000 RMB 000 Properties for development 1,211,774 Completed properties for sale 1,071,448 Properties under development for sale 16,163,346 16,279,376 Investment properties 7,398,000 6,911,000 Construction-in-progress 1,505,654 1,211,617 Bank deposits 482, SENIOR NOTES The senior notes comprise notes issued in 2011, 2013 and (a) The senior notes issued on March 29, 2011 ( Notes 2018 ) with an original maturity date on March 29, 2018, bore interest at % per annum with interest payable on March 29 and September 29 of each year, commencing on September 29, The senior notes were denominated in US dollars. During the year, the Company fully redeemed the Notes 2018 in accordance with the terms set out in the Indenture dated March 29, (b) (c) The senior notes issued on May 23, 2013 ( Notes 2016 ) matured on May 23, The senior notes bore interest at 5.375% per annum with interest payable on May 23 and November 23 of each year, commencing on November 23, The senior notes were denominated in RMB. In 2015, the Company repurchased certain amounts of Notes 2016 and the remaining outstanding balance was fully redeemed during the year in accordance with the terms set out in the Indenture dated May 23, The senior notes issued on May 8, 2014 ( Notes 2017 ) will mature on May 8, The senior notes bears interest at 6.2% per annum with interest payable on May 8 and November 8 of each year, commencing on November 8, Prior to the maturity of the senior notes, the Company may redeem the notes, in whole or in part, based on the stipulated redemption price at the point of redemption. The senior notes are denominated in SG dollars.

135 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SENIOR NOTES (Cont d) GROUP COMPANY RMB 000 RMB 000 RMB 000 RMB 000 Nominal value of senior notes issued 6,387,511 6,193,709 4,387,511 4,193,709 Transaction costs (1) (101,169) (98,031) (71,033) (67,895) At date of issue (2) 6,286,342 6,095,678 4,316,478 4,125,814 Cumulative interest accrued 2,184,536 1,718,992 1,832,223 1,417,028 Cumulative interest paid (2,001,064) (1,560,516) (1,678,270) (1,294,125) Repurchase and redemption (4,660,221) (127,582) (2,660,838) Exchange difference 124, , , ,835 Total 1,933,919 6,366,407 1,933,919 4,488,552 Interest payable within one year included in other payables (Note 27) (17,610) (98,106) (17,610) (87,360) Liability at end of year 1,916,309 6,268,301 1,916,309 4,401,192 Analysed as : Current 1,916,309 1,867,109 1,916,309 Non-current 4,401,192 4,401,192 1,916,309 6,268,301 1,916,309 4,401,192 (1) Transaction costs included non-audit fees of RMB5 million (2015 : RMB5 million) paid to the auditors of the Company in connection with the issuance of senior notes of the Company (Note 32). (2) Changes in amount at date of issue relative to the preceding year s amount include the effect of translation to the presentation currency and have been included in the currency translation reserve. The cumulative interests accrued on Notes 2018, Notes 2016 and Notes 2017 are calculated by applying effective interest rates of 11.3% (2015 : 11.3%), 6.0% (2015 : 6.0%) and 6.8% (2015 : 6.8%) per annum respectively. The management estimates the fair value of Notes 2017 at December 31, 2016 to be approximately RMB1.941 billion (2015 : RMB1.847 billion). This fair value is based on the price obtained from a bank s publication. In 2011, six of its subsidiaries provided a joint guarantee in respect of Notes 2018 issued by the Company amounting to RMB2.520 billion (equivalent to US$400 million) for a term of seven years up to March 29, The joint guarantee approximated RMB2.597 billion as at the end of Additionally, shares in six of its subsidiaries were charged in favour of the global security agent and trustee of Notes 2018 as at December 31, In 2013, the Company and five of its subsidiaries provided a joint guarantee in respect of Notes 2016 issued by a wholly-owned subsidiary of the Company amounting RMB2.000 billion for a term of three years up to May 22, The joint guarantee approximated RMB1.871 billion as at the end of Additionally, shares in five of its subsidiaries were charged in favour of the global security agent and trustee of Notes 2016 as at December 31, In 2014, six of its subsidiaries provided a joint guarantee in respect of Notes 2017 issued by the Company amounting to RMB1.856 billion (equivalent to S$400 million) for a term of three years up to May 8, The joint guarantee approximates RMB1.920 billion (2015 : RMB1.835 billion), the equivalent of S$400 million as at the end of Additionally, shares in six of its subsidiaries are charged in favour of the global security agent and trustee of Notes 2017.

136 130 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, TRADE PAYABLES GROUP RMB 000 RMB 000 Non-controlling shareholder of a subsidiary 909,328 1,411,435 Outside parties 7,017,666 6,336,090 7,926,994 7,747,525 The average credit period for trade payables is 174 days (2015 : 173 days). 27 OTHER PAYABLES GROUP COMPANY RMB 000 RMB 000 RMB 000 RMB 000 Advances received from customers 23,449,697 17,092,892 Accrued expenses 64,256 63,250 3,380 2,153 VAT payable 54,587 Sales-related tax payable 15,812 97,260 Interest payable 46, ,417 18,357 94,088 Other payables 458, ,637 24,088,948 17,956,456 21,737 96, REVENUE GROUP RMB 000 RMB 000 Income from property development 24,893,558 15,833,153 Income from property investment 363, ,547 Income from others 407, ,657 Total 25,664,408 16,581,357

137 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT OTHER OPERATING INCOME GROUP RMB 000 RMB 000 Dividend income from held-for-trading investment 93 Fair value gain on investment properties (Note 8) 366, ,865 Fair value gain on held-for-trading investment 5,967 4,985 Interest income 268, ,239 Net gain on disposal of property, plant and equipment 7, Net gain on disposal of investment properties 7,251 4,962 Net foreign exchange gain 129,348 Government subsidies 13,687 23,497 Others 14,533 14,994 Total 812,281 1,087, FINANCE COST GROUP RMB 000 RMB 000 Interest on bank and other borrowings 886, ,420 Interest on senior notes 383, ,169 Interest to ultimate holding company (Note 5) 560 1,883 Interest to non-controlling shareholders of subsidiaries 208, Total borrowing costs 1,479,413 1,297,613 Less: Interest capitalised in properties for development (54,267) (69,558) properties under development for sale (1,053,869) (999,235) properties for development and properties under development for sale in joint venture (23,458) (21,927) Net 347, , INCOME TAX GROUP RMB 000 RMB 000 Current 1,677, ,344 Deferred income tax (Note 16) 182, ,321 Deferred withholding tax (Note 16) 227, ,158 Land appreciation tax ( LAT ) 1,404, ,154 Under provision in prior years 2,375 24,713 Total 3,494,956 1,946,690 No provision for Singapore taxation has been made as the majority of the Group s income neither arises in, nor is derived from Singapore. In 2016 and 2015, most of the taxation arising in the PRC is calculated at the prevailing rate of 25%.

138 132 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, INCOME TAX (Cont d) The income tax expense varied from the amount of income tax expense determined by applying the above income tax rate to profit before income tax as a result of the following differences: GROUP RMB 000 RMB 000 Profit before income tax 7,472,154 4,317,113 Income tax expense at PRC applicable tax rate of 25%* 1,868,039 1,079,278 Non-deductible items 408, ,089 Non-taxable items (26,502) (23,234) Effect of unutilised tax losses not recognised as deferred tax assets 9,415 87,151 Effect of different tax rates for certain subsidiaries 8,663 11,416 LAT 1,404, ,154 Effect of tax deduction on LAT (351,151) (169,288) Withholding tax incurred 227, ,158 Under provision in prior years 2,375 24,713 Others (56,861) (121,747) Total income tax expense 3,494,956 1,946,690 * These are the applicable tax rates for most of the Group s taxable profits. Income tax for overseas subsidiaries is calculated at the rates prevailing in the respective jurisdiction. According to a PRC tax circular of State Administration of Taxation, Guoshuihan (2008) No.112, dividend distributed out of the profits generated since January 1, 2008 held by the PRC entity to non-resident investors shall be subject to PRC withholding income tax. Deferred tax liability of RMB227 million (2015 : RMB111 million) on the undistributed earnings of the PRC subsidiaries has been charged to the consolidated statement of profit or loss of the year. LAT As disclosed in the prior years audited consolidated financial statements, provision for the LAT with respect to properties sold in Shanghai Pudong New District prior to October 1, 2006 were not made as the directors of the Company, after taking into account legal advice received and consultation with the local Shanghai Pudong Tax Bureau, were of the opinion that the relevant tax authority is not likely to impose any LAT on a retrospective basis. As at December 31, 2014, the tax settlement process for a completed project and a phase of a project with properties sold in Shanghai Pudong New District prior to October 1, 2006 had been completed, with additional LAT payments made by the Group. For the projects with properties sold in Shanghai Pudong New District subsequent to October 1, 2006, the tax settlement amount determined by the tax authorities for a phase of a project which has commenced the tax settlement process was lower than what the Group has previously provided for based on the tax laws. Management has assessed and considers that the provision for LAT made by the Group relating to the above projects for which the tax settlement process had commenced or completed was adequate to meet the tax settlement amount determined by the tax authorities.

139 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT INCOME TAX (Cont d) Management is of the view that it is not probable that the tax authority will impose further LAT tax payments on the above projects located in Shanghai Pudong New District in excess of the provision previously made by the Group. The additional LAT tax exposure in the event of future re-assessment by the tax authorities has been estimated by management to be approximately RMB597 million (2015 : RMB598 million) (before effects of deductibility for income tax assessment purpose and adjustment for non-controlling interests) as at December 31, The amount has been disclosed as part of the Group s contingent liabilities in accordance with FRS 37 Provisions, Contingent Liabilities and Contingent Assets (Note 36). The actual Group s LAT liabilities are subject to the determination by the tax authorities upon completion of the property development projects. 32 PROFIT FOR THE YEAR Profit for the year has been arrived at after charging (crediting): GROUP RMB 000 RMB 000 Depreciation of property, plant and equipment 32,085 35,093 Employee benefits expense (including directors remuneration): Retirement benefit scheme contributions 72,024 62,155 Salaries and other short-term benefits 712, ,599 Total employee benefits expense 784, ,754 Directors fees 1,916 1,817 Directors remuneration: of the Company 41,766 23,253 of the subsidiaries 8,423 6,949 50,189 30,202 Fair value gain on investment properties (Note 8) (366,090) (919,865) Fair value gain on held-for-trading investment (5,967) (4,985) Net gain on disposal of property, plant and equipment (7,135) (29) Net gain on disposal of investment properties (7,251) (4,962) Net loss on disposal of held-for-trading investment 937 Net foreign exchange (gain) loss (129,348) 222,759 Cost of completed properties for sale recognised as expenses 17,194,371 11,676,078 Audit fees: paid to auditors of the Company 4,069 3,851 paid to other auditors 2,193 1,709 Total audit fees 6,262 5,560 Non-audit fees: paid to auditors of the Company paid to other auditors Total non-audit fees Aggregate amount of fees paid to auditors 6,954 6,337

140 134 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, EARNINGS PER SHARE The calculation of the basic and diluted earnings per share attributable to the ordinary owners of the Company is based on the following data: GROUP RMB 000 RMB 000 Earnings Earnings for the purposes of basic and diluted earnings per share (profit for the year attributable to owners of the Company) 2,697,361 1,468,539 Number of shares GROUP Weighted average number of ordinary shares for the purposes of basic and diluted earnings per share 1,946,656 1,948,736 GROUP Earnings per share (Renminbi cents): Basic and diluted There is no potential dilutive ordinary share in 2016 and DIVIDENDS In 2016, approximately RMB142 million of dividends was paid in respect of a first and final one-tier tax exempt dividend of 7.28 Renminbi cents (equivalent to 1.52 Singapore cents) per ordinary share declared for the financial year ended December 31, In 2015, approximately RMB113 million of dividends was paid in respect of a first and final one-tier tax exempt dividend of 5.82 Renminbi cents (equivalent to 1.30 Singapore cents) per ordinary share declared for the financial year ended December 31, In respect of the current year, the directors proposed a first and final one-tier tax exempt dividend of Renminbi cents (equivalent to 4.35 Singapore cents) per ordinary share amounting to approximately RMB405 million. The dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements.

141 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT SEGMENT INFORMATION The Group s reportable operating segments are as follows: (i) (ii) (iii) Property development: Development of residential, commercial and other properties. Property investment: Leasing of properties to generate rental income and to gain from the appreciation in the value of the properties in the long term. Others: Provision of property management, ancillary services, advance purchase of construction materials, investment holding and others. Information regarding the operations of each reportable segments are included below. The management monitors the operating results of each operating segment for the purpose of making decisions on resource allocation and performance assessment. The Group s operations are located in the PRC, hence no analysis by geographical area of operations is provided. Segment revenue and results The following is an analysis of the Group s revenue and results by reportable segment: GROUP Revenue Profit (loss) before income tax RMB 000 RMB 000 RMB 000 RMB 000 Property development 24,893,558 15,833,153 7,290,139 3,751,095 Property investment 363, , ,846 1,003,499 Others 407, ,657 (269,831) (437,481) Total 25,664,408 16,581,357 7,472,154 4,317,113 Segment profit represents the profit earned by each segment as determined using the Group s accounting policy. This is the measure reported to the chief operating decision maker for the purposes of resources allocation and assessment of segment performance. Segment assets GROUP RMB 000 RMB 000 Property development 69,570,606 64,890,660 Property investment 14,928,045 12,155,324 Others 8,949,761 2,851,432 Total assets 93,448,412 79,897,416 All assets are allocated to reportable segments. Liabilities are not allocated as they are not monitored by the chief operating decision maker for the purposes of resource allocation and assessment of segment performance.

142 136 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, SEGMENT INFORMATION (Cont d) Other segment information GROUP Depreciation Additions to non-current assets RMB 000 RMB 000 RMB 000 RMB 000 Property development 18,009 20,360 1,259, ,276 Property investment 8,500 8,052 1,931, ,882 Others 7,766 8,804 5,022 5,393 Total 34,275 37,216 3,196,206 1,184, ACQUISITION OF SUBSIDIARIES During the year, there were acquisition of subsidiaries as follows: Acquisition of Assets (a) (b) On January 28, 2016, the Group acquired 100% of the issued share capital of Shenzhen Huarong Innovation Investments Co., Ltd. for a cash consideration of RMB300 million. On May 20, 2016, the Group acquired 51% of the issued share capital of Nanjing Daji Real Estate Development Co., Ltd. ( NJ DR ) by way of capital injection of RMB156 million. (i) (ii) (iii) NJ DR owns 3 land parcels in PRC ( Parcel 1 and 2, and Parcel 3 ). Pursuant to the shareholders agreement, the non-controlling shareholder has control over specified asset of NJ DR, which includes the operation of Parcel 1 and 2, thereby rights to assets and obligations to liabilities of Parcel 1 and 2 (referred to as Portion A thereafter) despite the legal form of NJ DR as a single entity. The Group only has control over Portion B of NJ DR, which is the developer of Parcel 3. Therefore, the Group treats Portion B of NJ DR as a deemed separate entity under FRS 110 Consolidated Financial Statement, and only Portion B is consolidated. Although under the PRC law, Portion B will still be required to bear the liabilities incurred by Portion A should the assets of Portion A are insufficient to repay its liabilities, the non-controlling shareholder is required to repay Portion B for the liability as agreed under the cooperation agreement. In the event of default of the non-controlling shareholder, management has assessed that the non-controlling interest s share in Portion B and guaranteed dividend of RMB1.100 billion (see (iii) below) is sufficient to serve as collateral. The non-controlling shareholder is entitled to a guaranteed dividend of RMB1.100 billion upon completion of development. In the event of shortfall of available dividend, the Group shall compensate for the difference. Therefore, this represents a contingent consideration which is contingent on the performance of the project company. Based on management s budget as at acquisition date and as at year end, the non-controlling shareholder s share of NJ DR s budgeted profit is expected to be more than the guaranteed dividend amount. Accordingly, the fair value of the contingent consideration is estimated to be RMB Nil as at acquisition date and as at the end of the reporting period.

143 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT ACQUISITION OF SUBSIDIARIES (Cont d) (c) (d) On June 23, 2016, the Group acquired 30% of the issued share capital of Suzhou Renan Real Estate Co., Ltd. ( SZ RA ) by way of capital injection of RMB30 million and assignment of shareholder s loan due from SZ RA to the non-controlling shareholder of RMB593 million. On August 30, 2016, the Group acquired 75% of the issued share capital of Shenzhen Hengming Commercial Co., Ltd. ( SC HC ), for a cash consideration of RMB7.5 million and shareholder loan assumed of RMB2.242 billion. On December 30, 2016, the Group acquired the remaining 25% issued share capital of SC HC for a cash consideration of RMB2.5 million and shareholder loan assumed of RMB1.122 billion, which has been accounted for as a change in Group s ownership interest in a subsidiary that does not result in change of control (Note 10). The Group s intention was to acquire the land and vacated properties held by the above mentioned companies and the Group did not take over any management or operational process from the vendors as it intends to develop and sell the properties. The acquisitions were accounted for as acquisition of assets and were out of scope of FRS 103 Business Combinations. Acquisition of Business On August 8, 2016, the Group acquired 100% equity interest in Zhongshan Renyuan Investment Co., Ltd. ( ZS RI ) for a consideration of RMB64 million. ZS RI has a wholly-owned subsidiary, Zhongshan Renyuan Real Estate Co., Ltd. ( ZS RR ), which in turn holds interests in three joint ventures. The joint ventures are investment holding and property development companies involved in the primary redevelopment of land parcels in Zhongshan city, PRC. This acquisition was accounted for by the acquisition method of accounting. i. Goodwill arising on acquisition The fair value of identifiable net assets acquired is RMB64 million. Accordingly, no goodwill has been recognised on acquisition. ii. Impact of acquisition on the result of the Group Had the business combination during the year been effected at January 1, 2016, management estimated that there would be no significant changes to the Group s revenue and profit for 2016.

144 138 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, ACQUISITION OF SUBSIDIARIES (Cont d) The following summarises the recognised amounts of assets acquired and liabilities assumed at the acquisition dates: GROUP RMB 000 Property, plant and equipment (Note 7) 14 Properties for development 7,398,101 Investments in joint ventures 63,000 Other receivables 3,991 Cash and cash equivalents 334,833 Bank and other borrowings (2,600,000) Non-trade amounts due to non-controlling shareholders of subsidiaries (2,329,493) Other payables (2,240,319) Net assets at date of acquisition 630,127 Non-controlling interests (72,504) Net assets acquired 557,623 Shareholder's loans assumed 2,835,506 Total consideration 3,393,129 Consideration payable (3,383) Cash consideration paid in previous year (1,555,000) Cash acquired (334,833) Net cash outflow arising on acquisition 1,499, CHANGE OF CONTROL AS SUBSIDIARIES TO ASSOCIATES On August 30, 2016, a supplementary shareholders agreement was signed between the Group and the joint venture partners, and the Group lost control and power over Sino-Singapore Yanlord (Haimen) Yangtze Eco Hi-Tech City Co., Ltd. ( SSYHYE ) and its wholly-owned subsidiary, Sino-Singapore Yanlord Haimen Yangtze Eco Hi-Tech City Investment and Development Co., Ltd. (collectively, the Haimen Companies ), as a result of changes in the article of association of SSYHYE with effect from September 30, Accordingly, the Haimen Companies ceased to be subsidiaries of the Group and are classified as associates. The Group s effective interest in the Haimen Companies remain unchanged at 55%. Consequently, the Haimen Companies were deconsolidated and are equity accounted for in the consolidated financial statement.

145 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT CHANGE OF CONTROL AS SUBSIDIARIES TO ASSOCIATES (Cont d) Details of the change of control are as follow: GROUP RMB 000 Property, plant and equipment (Note 7) 2,011 Deferred tax asset 4,606 Properties under development for sale 147,353 Other receivables and deposits 1,735 Cash and cash equivalents 146,984 Trade and other payables (62,277) Net assets at date of change of control 240,412 Non-controlling interests (108,185) Net assets derecognised 132,227 Gain (Loss) on change of control Consideration received Net asset derecognised (132,227) Fair value of retained interest 132,227 Net cash outflow arising from change of control Consideration received Cash and cash equivalents derecognised (146,984) (146,984) 38 OPERATING LEASE ARRANGEMENTS The Group as leasee GROUP RMB 000 RMB 000 Minimum lease payments under operating leases recognised as an expense in the year 16,456 18,690 At the end of the reporting period, the Group has outstanding commitments under non-cancellable operating leases, which fall due as follows: GROUP RMB 000 RMB 000 Within one year 16,318 18,051 In the second to fifth year inclusive 9,613 22,485 More than five years 15,708 17,531 41,639 58,067

146 140 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, OPERATING LEASE ARRANGEMENTS (Cont d) Operating lease payments substantially represent rental payables by the Group in respect of land and buildings for its office premises and staff accommodation. Leases are negotiated for an average term of less than 3 years (2015 : less than 3 years). The Group as lessor The Group rents out its investment properties and certain completed properties for sale in the PRC under operating leases. Property rental income earned during the year was RMB349 million (2015 : RMB380 million). At the end of the reporting period, the Group has contracted with tenants for the following future minimum lease receipts: GROUP RMB 000 RMB 000 Within one year 227, ,126 In the second to fifth year inclusive 583, ,570 More than five years 470, ,870 1,282,316 1,495, CAPITAL EXPENDITURE COMMITMENTS Estimated amounts committed for future capital expenditure but not provided for in the financial statements: GROUP RMB 000 RMB 000 Investment properties 23, ,310 Acquisition of property 108, , , CONTINGENCIES AND GUARANTEES As at December 31, 2016, the Group has provided guarantees of approximately RMB billion (2015 : RMB7.577 billion) to banks for the benefit of its customers in respect of mortgage loans provided by the banks to these customers for the purchase of the Group s development properties. Should such guarantees be called upon, there would be an outflow of cash (previously collected by the Group) from the Group to the banks to discharge the obligations. The management has made enquiries with the banks and considered the profile of customers who bought the Group s properties and concluded that the likelihood of these guarantees being called upon is low. These guarantees provided by the Group to the banks would be released upon receiving the building ownership certificate of the respective properties by the banks from the customers as security for the mortgage loan granted. As described in Note 31, the additional LAT tax exposure in the event of future re-assessment by the tax authorities has been estimated by management to be approximately RMB597 million (2015 : RMB598 million) (before effects of deductibility for income tax assessment purpose and adjustment for non-controlling interests).

147 NOTES TO FINANCIAL STATEMENTS December 31, ANNUAL REPORT CONTINGENCIES AND GUARANTEES (Cont d) As at December 31, 2016, the Company, together with five of its subsidiaries, has provided joint guarantees to banks in respect of the following loan facilities granted to a subsidiary: A loan facility amounting to RMB2.251 billion (equivalent to US$325 million) (2015 : RMB2.500 billion (equivalent to US$385 million)) for a remaining term of less than one year up to June 23, The loan facility was fully drawn down as at the end of 2016 (2015 : RMB2.156 billion (equivalent to US$332 million)). A loan facility amounting to RMB1.179 billion (equivalent to US$170 million) (2015 : RMB billion (equivalent to US$170 million)) for a remaining term of less than two years up to May 4, The loan facility was fully drawn down as at the end of 2016 and A loan facility amounting to RMB559 million (equivalent to HK$625 million) (2015 : RMB Nil) for a remaining term of less than three years up to Apr 25, The loan facility was fully drawn down as at the end of As at December 31, 2015, the Company, together with five of its subsidiaries, had provided a joint guarantee in respect of senior notes issued by a wholly-owned subsidiary amounting to RMB1.871 billion for a remaining term of less than one year up to May 22, On May 22, 2016, the senior notes and interest payable were fully repaid. As at December 31, 2016, the Company has provided a guarantee to a bank in respect of a loan facility granted to a subsidiary amounting to RMB114 million (equivalent to S$24 million) (2015 : RMB230 million (equivalent to S$50 million)) for a remaining term of less than two years up to March 30, As at December 31, 2016, an amount of RMB114 million (equivalent to S$24 million) (2015 : RMB115 million (equivalent to S$25 million)) has been drawn down. As at December 31, 2016, the Company has provided a guarantee to a bank in respect of a loan facility granted to a subsidiary amounting to RMB600 million (2015 : RMB Nil) for a remaining term of less than three years up to May 11, The loan facility was fully drawn down as at the end of As at December 31, 2016, the Company has provided a guarantee to a third party in respect of a loan facility granted to a subsidiary amounting to RMB910 million (2015 : RMB Nil) for a remaining term of less than three years up to March 28, The loan facility was fully drawn down as at the end of As at December 31, 2016, the Company has provided a guarantee to a third party in respect of a loan facility granted to a subsidiary amounting to RMB590 million (2015 : RMB Nil) for a remaining term of less than three years up to April 26, The loan facility was fully drawn down as at the end of As at December 31, 2015, the Company has provided a guarantee to a bank in respect of a loan facility granted to a subsidiary amounting to RMB1.599 billion for a remaining term of less than seven years up to July 26, The loan facility was fully drawn down as at the end of On November 30, 2016, the loan and interest payable were fully repaid and the loan facility was cancelled accordingly. As at December 31, 2015, the Company had provided a guarantee to a non-controlling shareholder of subsidiaries in respect of an interest-free current advance to a subsidiary amounting to RMB96 million (equivalent to US$15 million). On June 23, 2016, the advance was fully repaid. As at December 31, 2016, a subsidiary of the Company has provided a guarantee to a bank in respect of a loan facility granted to a joint venture amounting to RMB400 million (2015 : RMB Nil) for a remaining term of less than two years up to April 14, The loan facility was fully drawn down as at the end of 2016.

148 142 YANLORD LAND GROUP LIMITED NOTES TO FINANCIAL STATEMENTS December 31, CONTINGENCIES AND GUARANTEES (Cont d) As at December 31, 2016, the joint venture Singapore Intelligent Eco Island Development Pte. Ltd. ( SIEID ) has pledged its shares in the joint venture Sino-Singapore Nanjing Eco Hi-tech Island Development Co., Ltd. ( SSNEHID ) to banks as security for credit facilities used by a wholly-owned subsidiary of SSNEHID for property development. SIEID s contingent liability under this pledge of its shareholding in SSNEHID is limited to an amount of RMB72 million (2015 : RMB217 million). A subsidiary of the Company has provided guarantee of RMB55 million (2015 : RMB165 million) for the same credit facilities. As at December 31, 2016, a subsidiary of the Company has provided joint guarantees to banks in respect of the following loan facilities granted to a wholly-owned subsidiary of SSNEHID: A loan facility for a remaining term of less than two years up to September 25, The loan facility was fully drawn down as at the end of 2016 and The subsidiary s contingent liability as at December 31, 2016 for this joint guarantee is limited to an amount of RMB134 million (2015 : RMB159 million). A loan facility for a remaining term of less than four years up to January 15, The loan facility was fully drawn down as at the end of 2016 and The subsidiary s contingent liability as at December 31, 2016 for this joint guarantee is limited to an amount of RMB388 million (2015 : RMB388 million). A loan facility for a remaining term of less than four years up to July 1, The loan facility was fully drawn down as at the end of 2016 and The subsidiary s contingent liability as at December 31, 2016 for this joint guarantee is limited to an amount of RMB342 million (2015 : RMB342 million). The management is of the view that the fair value of the financial guarantees provided by the Group and the Company are not significant. 41 EVENTS AFTER REPORTING PERIOD Subsequent to year end, the Group issued US$450 million (RMB3.122 billion) senior notes on January 23, 2017, which will mature on January 23, The senior notes bears interest at 5.875% per annum with interest payable on January 23 and July 23 of each year, commencing on July 23, The Company, together with five of its subsidiaries, had provided a joint guarantee in respect of the senior note issued.

149 INTERESTED PERSON TRANSACTIONS 143 ANNUAL REPORT 2016 The details of interested person transactions ( IPTs ) entered into during the financial year under review were as follows:- Name of interested person Aggregate value of all IPTs during the financial year under review (excluding transactions less than S$100,000 and transactions conducted under shareholders mandate pursuant to Rule 920) FY 2016 Aggregate value of all IPTs conducted under shareholders' mandate pursuant to Rule 920 (excluding transactions less than S$100,000) FY 2016 Yanlord Holdings Pte. Ltd. 1 RMB16,245,459 NA Lin Yi Ming 2 RMB9,554,355 NA Zheng Danni 2 RMB1,897,457 NA Hong Zhi Hua 3 RMB7,266,872 NA Zhang Hui Fang 4 RMB938,622 NA Zheng Qiang 4 RMB934,209 NA Zheng Quan 4 RMB1,102,038 NA Zhong Si Min 2&5 RMB180,000 NA Ho Su Ann 5 RMB21,605,422 NA Total RMB59,724,434 NA NA: Not applicable Notes: 1 Associate (as defined in the SGX Listing Manual) of Zhong Sheng Jian, director and controlling shareholder of the Company. 2 Relatives (as defined in the SGX Listing Manual) of Zhong Sheng Jian, director and controlling shareholder of the Company. ³ Hong Zhi Hua resigned as a director of the Company on 30 September Relatives (as defined in the SGX Listing Manual) of Hong Zhi Hua, who resigned as a director of the Company on 30 September Relatives (as defined in the SGX Listing Manual) of Zhong Siliang, director of the Company. The Group does not have a shareholders general mandate for IPTs. Save as disclosed above, there was no material contract entered into by the Company and its subsidiaries involving the interests of the chief executive officer or any director or controlling shareholder, either still subsisting at the end of the financial year or entered into since the end of the previous financial year.

150 144 YANLORD LAND GROUP LIMITED SHAREHOLDING STATISTICS As at 13 March 2017 Number of Shares Issued (including Treasury Shares) : 1,948,736,476 Class of Shares : Ordinary shares with one vote per share Issued and Paid-up Share Capital : S$1,482,552,080 Number of Treasury Shares : 9,150,600 1 No. of Percentage Percentage Size of Shareholdings Shareholders (%) 2 No. of Shares (%) , , ,001-10,000 3, ,146, ,001-1,000,000 1, ,808, ,000,001 AND ABOVE ,864,217, TOTAL 5, ,939,585, TWENTY LARGEST SHAREHOLDERS Percentage Name No. of Shares (%) 2 YANLORD HOLDINGS PTE. LTD. 1,035,390, UOB KAY HIAN PRIVATE LIMITED 245,106, DBS NOMINEES (PRIVATE) LIMITED 145,333, CITIBANK NOMINEES SINGAPORE PTE LTD 114,386, HL BANK NOMINEES (SINGAPORE) PTE LTD 100,390, BNP PARIBAS SECURITIES SERVICES SINGAPORE BRANCH 60,381, RAFFLES NOMINEES (PTE) LIMITED 28,837, DBSN SERVICES PTE. LTD. 24,516, HSBC (SINGAPORE) NOMINEES PTE LTD 22,137, MORGAN STANLEY ASIA (SINGAPORE) SECURITIES PTE LTD 20,254, DB NOMINEES (SINGAPORE) PTE LTD 14,788, KHENG LEONG COMPANY (PRIVATE) LIMITED 13,125, UNITED OVERSEAS BANK NOMINEES (PRIVATE) LIMITED 8,579, DBS VICKERS SECURITIES (SINGAPORE) PTE LTD 5,332, WANG NANHUA 4,645, OCBC SECURITIES PRIVATE LIMITED 4,517, MERRILL LYNCH (SINGAPORE) PTE LTD 3,083, LEE PINEAPPLE COMPANY PTE LTD 2,500, ONG ENG LOKE 2,500, TAN SHOOK YNG 1,852, TOTAL 1,857,658,

151 SHAREHOLDING STATISTICS As at 13 March ANNUAL REPORT 2016 SUBSTANTIAL SHAREHOLDERS As Stated in the Register of Substantial Shareholders Direct Interest Deemed Interest Total Interest Percentage Percentage Percentage Name No. of Shares (%) 2 No. of Shares (%) 2 No. of Shares (%) 2 YANLORD HOLDINGS PTE. LTD. 3 1,278,390, ,278,390, ZHONG SHENG JIAN 3 40,939, ,278,390, ,319,329, Notes: 1 Number of treasury shares purchased up to 8 March 2017 and credited as at 13 March Percentages calculated based on share capital of the Company as at 13 March 2017, excluding treasury shares credited as at the date. 3 Zhong Sheng Jian is a subtantial shareholder of the Company via his deemed interest of 1,278,390,000 ordinary shares in the Company held by Yanlord Holdings Pte. Ltd. ("YHPL"). YHPL is a company which is owned by Zhong Sheng Jian (95% shareholding interest) and his spouse (5% shareholding interest). The total no. of 1,319,329,700 ordinary shares are held directly and via nominee accounts. Based on the information available to the Company as at 13 March 2017, approximately 29.7% of the issued ordinary shares (excluding treasury shares) of the Company is held by the public and accordingly, Rule 723 of the Listing Manual issued by the Singapore Exchange Securities Trading Limited has been complied with.

152 146 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT Yanlord Land Group Limited ( Company and its group of companies, Group ) is committed to complying with the Code of Corporate Governance 2012 ( Code ) so as to safeguard the interests of the shareholders ( Shareholders ). This statement outlines the Company s corporate governance processes and activities that were in place during the financial year. BOARD MATTERS PRINCIPLE 1: BOARD S CONDUCT OF AFFAIRS Disclosure Guide ( DG ): Guideline 1.5 DG: Guideline 1.6 The principal functions of the board of directors of the Company ( Board ) include, among others, supervising the overall management and performance of the business and affairs of the Group and approving the Group s corporate and strategic policies and direction. Recognising the need for balance between the commercial needs of our customers and environmental preservation, the Group continues to introduce environmental initiatives through developing eco-friendly developments as and when appropriate. The Group s social responsibilities further extend to include donations to certain non-profit organisations. Matters which are specifically reserved for the Board s approval include, among others, significant corporate matters, major undertakings and all matters and transactions listed in the SGX s Listing Manual ( Listing Manual ) that require Board s approval. At all times, the directors shall act honestly and with diligence, and in the best interests of the Company. In the event of a conflict of interest situation arising in respect of a matter under consideration by the Board, the director concerned also complies with relevant disclosure obligations and abstained from participating in the deliberation of the matter by the relevant Board s committee(s) and / or Board, if so required. The Board dictates the strategic direction and management of the Company through quarterly reviews of the financial performance of the Group. To facilitate effective management, certain functions of the Board have been delegated to various Board s committees namely, the Audit Committee ( AC ), the Nominating Committee ( NC ), the Remuneration Committee ( RC ) and the Risk Management Committee ( RMC ) (collectively, Board Committees ). The Company s Constitution are sufficiently flexible to allow a director to participate at a meeting via telephone, video conference or by means of similar communication equipment. A director, who was unable to attend the meetings of the Board or of the Board Committees, would be provided with the relevant meeting materials prior to the meeting(s) and may raise his / her views on the agenda to the Board or the Board Committees in advance, if any. In the course of the financial year under review, the details of the number of meetings held and attended by each of the members of the Board and Board Committees are set out below: Board Meeting AC Meeting NC Meeting RC Meeting RMC Meeting Director Held* Attendance Held* Attendance Held* Attendance Held* Attendance Held* Attendance Zhong Sheng Jian Zhong Siliang 4 4 Chan Yiu Ling 4 4 Hong Zhi Hua Zhong Ming Ronald Seah Lim Siang Ng Ser Miang Ng Shin Ein Ng Jui Ping Notes: 1 Hong Zhi Hua resigned as a director of the Company on 30 September Zhong Ming was appointed as a director of the Company on 1 October * Reflects the number of meetings held during the time that the director held office. Indicates that the director was not a member of that committee during the year.

153 CORPORATE GOVERNANCE STATEMENT 147 ANNUAL REPORT 2016 A director, upon appointment, would be provided with a formal letter setting out his / her duties and obligations as a director and undergone an induction programme to familiarise himself / herself of the Group s business and structure, governance practices and matters relating to the Board and Board Committees, if necessary. Accordingly, a formal letter of appointment was furnished to our newly-appointed director, Zhong Ming, upon his appointment during the financial year. To familiarise Zhong Ming with the Board and Board Committees matters, he attended meetings of the Board, Board Committees and the annual general meetings of the Company since The directors may visit the development sites of the Group and meet the local management teams as and when necessary. The directors are also provided with further explanation and information on any aspect of the Company s operation or business issues from the management of the Company ( Management ) at quarterly board meetings or as and when so requested by the directors and receive relevant briefings and updates, particularly on relevant new laws and regulations and changing commercial risks, from time to time. During the year, the directors were provided with various regulatory updates such as the key legislative amendments made to the Companies Act, Cap. 50 ( Act ), key changes made to the audit reporting standards and etc. PRINCIPLE 2: BOARD COMPOSITION AND GUIDANCE DG: Guideline 2.1 DG: Guideline 2.3 DG: Guideline 2.4 DG: Guideline 2.6 The Board comprises: 1. Zhong Sheng Jian: Chairman and Chief Executive Officer 2. Zhong Siliang: Executive Director 3. Chan Yiu Ling: Executive Director 4. Zhong Ming: Executive Director (appointed on 1 October 2016) 5. Ronald Seah Lim Siang: Lead Independent Director 6. Ng Ser Miang: Independent Director 7. Ng Shin Ein: Independent Director 8. Ng Jui Ping: Independent Director The Board determines, at the recommendation of the NC, the independence of each independent director adopting, inter alia, the independence test as recommended by the Code. The NC and the Board note the need for progressive refreshing of the Board and the need to conduct rigorous review on the independence of each independent director who has served on the Board beyond nine years from his / her first appointment. For the independence test, each director is required to endorse an independent test form, content of which is in accordance with the guidelines as set out in the Code to declare his / her independency. Having noted that all the four independent directors of the Company have served the Board beyond nine years, a peer review was further conducted to assess whether each independent director expressed his / her individual viewpoints and continued to demonstrate strong independence in judgment in the discharge of his / her responsibilities as an independent director of the Company. The independent directors were also assessed in respect of whether they have objectively and constructively raised issues during meetings of the Board and of the Board Committees and whether they remained active in the discussions over issues concerning the Group and sought clarification as and when necessary from the Board, Management and the Group s external advisers on matters pertaining to their area of responsibilities and whether the Company has benefited from their years of experience in their respective fields of expertise. Each independent director is abstained from assessing and determining his / her own independence in such review. Taking into consideration the complexity of doing business in China and that these independent directors have continued to demonstrate strong independence in judgment in the discharge of their responsibilities as an independent director of the Company and that they have objectively and constructively raised issues and sought clarification as and when necessary from the Board, Management and the Group s external advisers on matters pertaining to their area of responsibilities whether on Board or on the Board Committees and that the Company has also benefited from their years of experience in their respective fields of expertise, the NC and the Board are of the view that all the four independent directors who have served the Board beyond nine years

154 148 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT from the respective date of their first appointments remain independent and none of the independent directors has a relationship as stated in Guideline 2.3 of the Code that would otherwise deem him / her not to be independent. Accordingly, there is a strong and independent element on the Board, with independent directors making up half of the Board. The Board believes that a diverse Board will enhance the decision makings of the Board by utilizing the variety in skills, experiences, gender and knowledge of the Group. When considering the appointment and re-appointment of any directors, in addition to complying with the relevant provisions of the Constitution, it has been the objective of the Board to ensure it comprises directors who as a group provide an appropriate balance and diversity of skills, experience, gender and knowledge of the Group. The Board is of a view that the current size and composition of the Board, their experience and core competencies in various fields are appropriate, effective and provides adequate diversity to the Board, taking into consideration the above objective, the scope and nature of operations of the Group, the requirements of the business and the need to avoid undue disruptions from changes to the composition of the Board and Board Committees. The Board has diversity of academic background and skills and knowledge in the areas of accounting or finance, business or management, industry, strategic planning and customer-based experience. Extensive experiences of the directors including their regional business expertise and strategic networking relationships further broaden diversity of the Board. The Board also comprising two female directors in recognition of the importance and value of gender diversity. Various assessments conducted annually on the Board, Board Committees as well as individual directors would allow the Board to ensure, inter alia, the balance and diversity of the Board necessary to maximise effectiveness. PRINCIPLE 3: CHAIRMAN AND CHIEF EXECUTIVE OFFICER Zhong Sheng Jian currently fulfills the roles as the Chairman of the Board ( Chairman ) and the Chief Executive Officer ( CEO ) of the Company. The Board has not adopted the recommendation of the Code to have separate directors appointed as the Chairman and the CEO. This is because the Board is of the view that there is a sufficiently strong independent element on the Board to enable independent exercise of objective judgment on the corporate affairs of the Group. Pursuant to the recommendation in the Code, the Company appointed Ronald Seah Lim Siang as its lead independent director to, inter alia, coordinate the activities of independent directors. To facilitate a more effective check on the Group, the independent directors may meet separately to discuss matters pertaining to the Group without the presence of the Management and / or the Executive Directors, on a need-be basis. The lead independent director would provide feedback to the Chairman for any relevant issues to be further addressed by the Group. Any concerns of Shareholders, if received by the Company, to the attention of the lead independent director shall be forwarded to him accordingly. The Chairman and the CEO is responsible for, among others, exercising control over the quality, quantity and timeliness of the flow of information within the Board and between the Board and the Management, and assisting in ensuring compliance with the Company s guidelines on corporate governance. PRINCIPLE 4: PRINCIPLE 5: BOARD MEMBERSHIP BOARD PERFORMANCE DG: Guideline 4.4 DG: Guideline 4.6 DG: Guideline 5.1 NOMINATING COMMITTEE ( NC ) The NC makes recommendations to the Board on all board appointments. The majority of the members of the NC, including its chairman, are independent. The chairman of the NC is Ng Ser Miang and the other members are Zhong Sheng Jian and our lead independent director, Ronald Seah Lim Siang. The NC is guided by its terms of reference which set out its responsibilities. The NC s responsibilities include: (a) reviewing and recommending the nomination and re-election of our directors having regard to the director s contribution and performance;

155 CORPORATE GOVERNANCE STATEMENT 149 ANNUAL REPORT 2016 (b) (c) determining on an annual basis whether or not a director is independent; and assessing the performance of our Board, Board Committees as well as contribution of the Chairman and each director to the effectiveness of the Board. A new director shall be appointed by the Board after taking into consideration the recommendation made by the NC. Selection of candidates to be considered for appointment as directors may be facilitated, inter alia, through recommendations from reliable sources. The NC, in considering the appointment and re-appointment of any director, evaluates the criteria of the new directors and performance of the existing directors. The assessment parameters for the new directors include integrity, diversity of competencies and expertise of the new directors. The assessment parameters for the existing directors include attendance records at meetings, intensity of participation at meetings and the quality of interventions. The Constitution requires new directors appointed during the year to submit themselves for re-election at the next Annual General Meeting ( AGM ) of the Company. The Constitution also requires one-third of the Board to retire by rotation at every AGM. This means that no director may stay in office for more than three years without being re-elected by Shareholders. The Board values the importance of succession planning and progressive renewal of the Board. In this regard, on an annual basis, the NC reviews and makes recommendation on the list of directors who are subject to retire by rotation and whether the composition of the Board shall remain unchanged taking into consideration, among others, each director s competencies, commitment, contribution and performance. Such recommendations will then be submitted to the Board for Board s consideration thereafter. The NC is of the view that although some of the directors have multiple board representations in other listed entities, such multiple board representations do not hinder them from carrying out their duties as directors. Instead, these directors participation in other listed entities would widen the experience of the Board and give it a broader perspective. The NC shall make recommendation to the Board for the Board to consider adopting the recommendation of the Code to determine the maximum number of listed company board representations which any director may hold as and when necessary. The Company has in place a system to assess the performance of the Board as a whole, its Board Committee and the contribution by the Chairman to the effectiveness of the Board on an annual basis ( Performance Assessment ). In carrying out the Performance Assessment, the NC and Board take into consideration the views of each individual director. Each director shall complete a questionnaire setting out their respective views on the performance of the Board, Board Committees and Chairman based on various aspects such as the structure of Board and Board Committees, conduct of meetings, corporate strategy and planning, risk management and internal controls and Company s performance. When assessing the overall performance of the Board, the NC and Board also take into account the directors number of listed company board representations and other principal commitments as defined in the Code to determine if a director is able to and has been adequately carrying out his / her duties as a director of the Company. The contribution of the Chairman is assessed taking into consideration the role of Chairman as prescribed by the Code. The Chairman abstained from participating in his own assessment. The results of the completed questionnaires are compiled into a summary report and the same is tabled for review by the NC and circulated to the Board for consideration thereafter. The Board, having satisfied with its performance, would resolve whether to retain the current composition of the Board taking into consideration, among others, adequate diversity of the Board, each director s competencies, commitment, contribution and performance. The NC also assessed the performance of individual directors on an annual basis based on factors such as the director s attendance record at the meetings of Board and Board Committees, intensity of participation at meetings and the quality of interventions. Recommendation in respect of the contribution of each individual director to the effectiveness of the Board will be made to the Board thereafter. Key information regarding the directors is set out in this Annual Report ( 2016 Annual Report ) under the heading entitled Board of Directors. The Company does not have any alternate director.

156 150 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT PRINCIPLE 6: ACCESS TO INFORMATION DG: Guideline 6.1 The Board is provided with financial information, as well as relevant background information and documents relating to items of business to be discussed at Board meetings prior to the scheduled meetings. The directors may (whether individually or as a group), in the furtherance of their duties, take independent professional advice (e.g. auditors), if necessary, at the Company s expense. The Board has separate and independent access to the Management and company secretary at all times. The directors are entitled to request from the Management and be provided with such additional information as needed to make informed decisions in a timely manner. The company secretary attends all Board and Board Committees meetings. The role of the company secretary includes responsibility for ensuring that Board procedures are followed and applicable rules and regulations are complied with. Under the direction of the Chairman, the company secretary also ensures good information flows within the Board and Board Committees and between the Management and independent directors. The appointment and removal of the company secretary should be a matter for the Board as a whole. REMUNERATION MATTERS PRINCIPLE 7: PRINCIPLE 8: PRINCIPLE 9: PROCEDURE FOR DEVELOPING REMUNERATION POLICIES LEVEL AND MIX OF REMUNERATION DISCLOSURE OF REMUNERATION DG: Guideline 9.2 DG: Guideline 9.3 DG: Guideline 9.4 DG: Guideline 9.6 REMUNERATION COMMITTEE ( RC ) The RC comprises 3 members, all of whom are independent and non-executive directors. The chairman of the RC is Ng Jui Ping and the other 2 members are Ronald Seah Lim Siang and Ng Shin Ein. The RC is guided by its terms of reference which set out its responsibilities. The RC recommends to the Board, a framework of remuneration for the directors and reviews the remuneration packages for each director and key management personnel. The recommendations of the RC are submitted for endorsement by the Board. All aspects of remuneration, including but not limited to directors fees, salaries, annual performance incentives and other benefits including benefits in kind are reviewed by the RC. Subject to the review of the Board, the RC has explicit authority within its terms of reference to obtain outside or other independent professional advice as it considers necessary to carry out its duties. The RC had also reviewed the Company s obligations arising in the event of termination of the executive directors and key management personnel s contracts of service and opined that such contracts of service contain fair and reasonable termination clauses which are not overly generous.

157 CORPORATE GOVERNANCE STATEMENT 151 ANNUAL REPORT 2016 No director or member of the RC has been involved in deciding his / her own remuneration package. The total remuneration mix for the CEO, executive directors and top 5 key executive officers (who are not also directors or the CEO) of the Group comprises three key components namely, basic salary, annual performance incentive and other benefits including benefits in kind. A significant and appropriate proportion of executive directors and key management personnel s remuneration is structured so as to link rewards to corporate and individual performance. Such performance-related remuneration is aligned with the interests of Shareholders and promotes the long-term success of the Company. Performance conditions to which entitlement to such incentives are met include benchmarking performance to business operation expectations and performance that exceeds such expectations, as well as measuring performance based on the Company s financial performance vis-à-vis industry performance. The extent to which the performance conditions have been met was taken into account in determining the actual quantum of variable component of remuneration. Whilst the Company currently does not make use of contractual provisions to allow the Company to reclaim incentive components of remuneration paid to its executive directors and key management personnel in exceptional circumstances of misstatement of financial results, or of misconduct resulting in financial loss to the Company, it will consider adopting such contractual provisions, as and when appropriate. Save for directors fees, which have to be approved by the Shareholders at every AGM, the independent directors do not receive any other remuneration from the Company. Taking into consideration the competitive human resource environment which is especially pronounced in the Group s segment of property market in China, it is proposed that the remuneration of the directors be disclosed in the 2016 Annual Report in bands of S$250,000 instead of disclosing such figures to the nearest thousand as required by the Code. 1. Remuneration of Directors for FY2016 The remuneration (which includes basic salaries, annual performance incentives, directors fees and other benefits including benefits in kind, if any) paid or payable to each of the directors as at 31 December 2016, in bands of S$250,000, are as follows: Remuneration Band Basic Salary Annual Performance Incentives Directors Fees Other benefits including benefits in kind Total S$8,500,000 to S$8,749,999 Zhong Sheng Jian 3.12% 96.83% 0.05% 100% S$750,000 to S$999,999 Zhong Siliang 74% 26% 100% S$250,000 to S$499,999 Chan Yiu Ling Zhong Ming 1 75% 75% 25% 25% 100% 100% Below S$250,000 Ronald Seah Lim Siang 100% 100% Ng Ser Miang 100% 100% Ng Shin Ein 100% 100% Ng Jui Ping 100% 100% Note: 1 Zhong Ming was appointed as a director of the Company on 1 October 2016.

158 152 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT 2. Remuneration of the Top 5 Key Management Personnel for FY2016 The remuneration (which includes basic salaries, annual performance incentives and other benefits including benefits in kind, if any) paid or payable to each of the following personnel as at 31 December 2016, based on their respective employment periods served in FY2016, in bands of S$250,000, are as follows: Remuneration Band Basic Salary Annual Performance Incentives Directors Fees Other benefits including benefits in kind Total S$500,000 to S$749,999 Zhang Hao Ning 75% 25% 100% Chen Ping 65% 35% 100% Lam Ching Fung 71% 29% 100% Zhou Cheng 68% 32% 100% Below S$250,000 Wang Xi 2 100% 100% Note: 2 Wang Xi was appointed as an Executive Vice President of the Group on 10 November The total remuneration paid to the above top 5 key management personnel for FY2016 was S$2,574, Remuneration of employees who are immediate family members (i.e. spouse, child, adopted child, step-child, brother, sister and parent) of a director or the CEO, and whose remuneration exceed S$50,000 during the year Remuneration Band Position Relationship Basic Salary Annual Performance Incentive Directors Fees Other benefits including benefits in kind Total S$450,000 to S$499,999 Zheng Xi Vice-Chairman of Yanlord Investment (Nanjing) Co., Ltd. Brother of our Chairman & CEO, Zhong Sheng Jian 69% 31% 100% S$200,000 to S$249,999 Zhong Si Nuo Assistant to our Chairman & CEO, Zhong Sheng Jian Daughter of our Chairman & CEO, Zhong Sheng Jian 85% 15% 100%

159 CORPORATE GOVERNANCE STATEMENT 153 ANNUAL REPORT Remuneration of employees who are immediate family members (i.e. spouse, child, adopted child, step-child, brother, sister and parent) of a director or the CEO, and whose remuneration exceed S$50,000 during the year (Cont d) Remuneration Band Position Relationship Basic Salary Annual Performance Incentive Directors Fees Other benefits including benefits in kind Total S$150,000 to S$199,999 Chung Chiu Yan Director of Yanlord Investment (Nanjing) Co., Ltd. Brother of our Chairman & CEO, Zhong Sheng Jian 100% 100% Zhong Si Li Zhong Si Min Assistant to General Manager of Shenzhen Long Wei Xin Investment Co., Ltd. Finance Manager of Shanghai Yanlord Xing Tang Real Estate Co., Ltd. Brother of Zhong Siliang, our Executive Director Brother of Zhong Siliang, our Executive Director 79% 21% 100% 77% 23% 100% ACCOUNTABILITY AND AUDIT PRINCIPLE 10: ACCOUNTABILITY The Board understands its accountability to the Shareholders for the Group s performance, and Management understands its role in providing all members of the Board with financial accounts and such explanation and information to enable the Board to make a balanced and informed assessment of the Group s performance, financial position and prospects. The Board also ensures that the Company complies with the applicable legislative and regulatory requirements. The Board provides confirmation to the Shareholders in the Company s quarterly financial results announcements that to the best of their knowledge, nothing has came to the attention of the Board which may render the financial results of the Group to be false or misleading in any material aspects. A balance and understandable assessment of the Group s performance and financial position with a commentary of the significant trends and competitive conditions of the industry in which the Group operates is provided to the Shareholders on a quarterly basis. The Management is accountable to the Board and presents to the Board, quarterly and full year financial results after the same are reviewed by the AC. The Board reviews and approves the results and authorises the release of results to the public via SGXNET.

160 154 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT PRINCIPLE 11: RISK MANAGEMENT AND INTERNAL CONTROLS DG: Guideline 11.3 The Board is responsible for the governance of risk. The Board ensures that a sound system of risk management and internal controls to safeguard Shareholders interests and the Company s assets is maintained by the Management. The internal controls are intended to provide reasonable but not absolute assurance against material misstatements or losses and include the safeguarding of assets, maintenance of proper accounting records, reliability of financial information, compliance with appropriate legislations, regulations and best practices, and the identification and containment of business risks. Based on the internal controls established and maintained by the Group, work performed by internal and external auditors, and reviews performed by Management, various Board Committees and the Board, the Board, with the concurrence of the AC, are of the opinion that the Group s internal controls, including financial, operational, compliance and information technology controls, and risk management systems, were adequate and effective as at 31 December The Board has received assurance from the Chairman and CEO and the Group Financial Controller as well as the internal auditors that for the financial year under review, the financial records have been properly maintained and the financial statements give a true and fair view of the Company s operations and finances; and regarding the effectiveness of the Company s risk management and internal control systems. RISK MANAGEMENT COMMITTEE ( RMC ) The RMC comprises 4 members who are appropriately qualified with relevant expertise and experience to discharge their responsibilities. The chairman of the RMC is Ng Shin Ein and the other 3 members are Zhong Sheng Jian, Ng Ser Miang and Ng Jui Ping. The majority of the members of the RMC, including its chairman, are independent. The RMC is guided by its terms of reference which set out its responsibilities including: (a) (b) (c) identifying, measuring, managing and controlling risks that may have a significant impact on the Group s property development activities; reviewing and assessing the Group s risk related policies and methodologies; and considering and reviewing matters that may have a significant impact on the stability and integrity of the property market in the People s Republic of China. The Board, with the assistance of the RMC, reviews the Company s risk practices and procedures, and oversee the Management in the design, implementation and monitoring of the risk management system. PRINCIPLE 12: AUDIT COMMITTEE ( AC ) DG: Guideline 12.6 The AC comprises 3 independent and non-executive directors who are appropriately qualified with relevant expertise and experience to discharge their responsibilities. The chairman of the AC is Ronald Seah Lim Siang and the other 2 members are Ng Shin Ein and Ng Jui Ping. The AC is guided by its terms of reference which set out its responsibilities. The AC assists the Board in discharging its responsibility to safeguard the Group s assets, maintain adequate accounting records, and develop and maintain effective systems of internal control, with the overall objective of ensuring that the Management creates and maintains an effective control environment in the Group. The AC provides a channel of communication between the Board, the Management and the external auditors on matters relating to audit.

161 CORPORATE GOVERNANCE STATEMENT 155 ANNUAL REPORT 2016 The duties of the AC include: (a) (b) (c) (d) (e) (f) (g) (h) (i) review with the external auditors and where applicable, our internal auditors, their audit plans, their evaluation of the system of internal accounting controls, their letters to Management and the Management s response; review quarterly and annual financial results announcements before submission to the Board for approval, focusing in particular on changes in accounting policies and practices, major risk areas, significant adjustments resulting from the audit, compliance with accounting standards and compliance with the Listing Manual and any other relevant statutory or regulatory requirements; review and report to the Board the adequacy and effectiveness of the internal controls, including financial, operational, compliance and information technology controls and ensure co-ordination between the external auditors and the Management, and review the assistance given by the Management to the auditors, and discuss issues and concerns, if any, arising from audits, and any matters which the auditors may wish to discuss (in the absence of the Management, where necessary); review and discuss with the external auditors any suspected fraud or irregularity, or suspected infringement of any relevant laws, rules or regulations, which has or is likely to have a material impact on the Group s operating results or financial position, and the Management s response; consider and recommend the appointment or re-appointment of the external auditors and matters relating to the resignation or dismissal of the auditors; review interested person transactions (if any) falling within the scope of Chapter 9 of the Listing Manual; review potential conflicts of interest, if any; undertake such other reviews and projects as may be requested by the Board, and report to the Board its findings from time to time on matters arising and requiring the attention of the AC; and generally undertake such other functions and duties as may be required by statute or the Listing Manual, or by such amendments as may be made thereto from time to time. The AC meets, at a minimum, on a quarterly basis. In the event that a member of the AC is interested in any matter being considered by the AC, he / she would abstain from reviewing that particular transaction or voting on that particular resolution. If necessary, the AC also meets with the internal and external auditors without the presence of Management. The internal and external auditors have unrestricted access to the AC and vice versa. The AC has been given full access to and co-operation of the Management and has reasonable resources to enable it to discharge its function properly. None of the former partners or directors of the Company s existing auditing firm is a member of the AC. The Group incurred an aggregate amount of fees of approximately RMB4.3 million (excluding out of pocket expenses and goods and services tax and converted at a rate of SGD1 = RMB4.60) to the external auditors, Deloitte & Touche LLP, Singapore and Deloitte Touche Tohmatsu Certified Public Accountants LLP, Shanghai, PRC (collectively, Deloitte ), comprising audit fees of approximately RMB3.8 million and non-audit services fee of approximately RMB0.5 million for the year under review. In compliance with Rule 1207(6)(b) of the Listing Manual, the AC confirmed that it has undertaken a review of all non-audit services provided by Deloitte and they would not, in the AC s opinion, affect the independence of Deloitte. In reviewing the nomination of Deloitte for the re-appointment, the AC has also considered the adequacy of the resources, experience and competence of Deloitte and has taken into account the audit quality indicators relating to Deloitte at both firm and audit engagement level.

162 156 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT The Group has complied with Rules 712 and 715 of the Listing Manual in appointing the audit firms for the Group, its foreign subsidiaries and associated companies. The AC held 4 meetings (other than passing of resolutions by way of circulations) during the year and carried out its duties as set out within its terms of reference including matters such as reviewing and recommending the relevant financial results to the Board before the same are released on SGXNET, reviewing the internal audit reports and reviewing the re-appointment of external auditors and the audit fees. The AC will also be briefed and updated of any changes to accounting standards and issues which may have direct impact on financial statements from time to time where necessary. AC Commentary on Significant Matters: Significant matters Assessment of recoverable amounts for properties for development, properties under development for sale and completed properties for sale (the Properties ) Valuation of investment properties How the AC reviewed these matters and what decisions were made The AC considered the management s approach and methodology applied in determining whether the Group s Properties are impaired and the amount of impairment to be recorded, if any. The AC reviewed the management assumptions relating to the reasonableness of the future sales and projected construction costs used in the management assessment. The assessment of recoverable amounts for the Group s Properties was an area of focus for the external auditor, who has included this as a key audit matter for the financial year ended December 31, Refer to page 60 of this Annual Report. The AC considered the approach and methodology applied by the independent professional valuer to the valuation model in assessing the valuation of investment properties as at year end. The AC reviewed the reasonableness of the key assumptions used in the valuation, which include (i) price per square metre; (ii) capitalisation rates; (iii) market rent per square metre per month. Land appreciation tax ( LAT ) The valuation of investment properties was an area of focus for the external auditor, who has included this as a key audit matter in its audit report for the financial year ended December 31, Refer to page 61 of this Annual Report. The AC considered the management s approach and methodology used in the Group s LAT computations. The AC reviewed the reasonableness of management s judgements taken relating to management s provisioning for LAT as at year end. LAT was an area of focus for the external auditor, who has included this item as a key audit matter in its audit report for the financial year ended December 31, Refer to page 62 of this Annual Report.

163 CORPORATE GOVERNANCE STATEMENT 157 ANNUAL REPORT 2016 The Company has in place a whistle-blowing policy which provides an avenue for employees of the Group and any other persons to raise concerns about possible improprieties in matters of financial reporting, accounting or auditing, internal controls or internal accounting controls and other operational matters ( Complaint ). The Company believes that it is in the best interests of the Group to promote a working environment conducive for employees and any other persons to raise or report their concerns. Every Complaint raise shall be lodged with the Internal Audit Manager of the Company. The internal audit department maintains a complaint register for the purposes of recording details of such Complaints. The whistleblowing procedure is set out below: 1. Definitions The following words as used shall have the meanings ascribed here: 1.1 Possible Malpractice means any activity, breach of business conduct and ethics or omission by an employee of the Group or any concerns regarding accounting or auditing matters, internal controls or internal accounting controls and other operational matters that are either questionable or not in accordance with accepted accounting practices and / or trade practices prescribed by the Group. 1.2 Complaint means any complaint alleging either Possible Malpractices or Retaliatory Action. 1.3 Retaliatory Action means the use or attempted use of force, authority, intimidation, threat, undue pressure of any kind or any other negative or other inappropriate action, by any employee or officer of the Group, against any person who has filed a Complaint. 2. Reporting of Possible Malpractices The Company believes that it is in the best interests of the Group to promote a working environment conducive for employees and any other persons to raise or report genuine concerns about Possible Malpractices in matters of financial reporting or other matters in strict confidence, (please refer to item 1.1) they may encounter, without fear of Retaliatory Action. 3. Procedure 3.1 Lodging a Complaint Every Complaint shall be lodged with the Internal Audit Manager of the Company by the following means: 1) By OR address: patrick@yanlord.com.hk Attention: The Internal Audit Manager 2) By Mail Attention: The Internal Audit Manager Address: 38F Far East Finance Centre, 16 Harcourt Road, Hong Kong. (Mark envelope Private and Confidential ) All correspondence shall be treated with the strictest confidence.

164 158 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT The complainant must provide his / her particulars ( Particulars ) as follows: In the case of employee of the Group: (a) Name; (b) Department / Company; (c) Contact Number; and (d) if available In the case of any other person: (a) Name; (b) Correspondence Address / Company; (c) Contact Number; and (d) if available. The Complaint would not be attended to if the Particulars are not stated. Each complainant is required to provide the Particulars to allegations because appropriate follow-up questions and investigations may not be possible unless the source of the information is identified. By providing the Particulars to the Company, each complainant agrees for the Company to use and disclose the Particulars for purposes of the Complaint. 3.2 Confidentiality of Identity Every effort will be made to protect the complainant s identity. The identity of the complainant shall be confidential save where: the identity of the complainant, in the opinion of the AC, is material to any investigation; it is required by law, or by the order or directive of a court of law, regulatory body or by the Singapore Exchange or such other body that has the jurisdiction and authority of the law to require such identity to be revealed; the AC with the concurrence of the Board of Directors opined that it would be in the best interests of the Group to disclose the identity; it is determined that the Complaint was frivolous, in bad faith, or in abuse of these policies and procedures and lodged with malicious or mischievous intent; or the identity of such complainant is already in the public domain.

165 CORPORATE GOVERNANCE STATEMENT 159 ANNUAL REPORT 2016 PRINCIPLE 13: INTERNAL AUDIT DG: Guideline 13.1 The Group has an in-house internal audit function ( Internal Audit ) that is independent of the activities it audits. The Internal Audit is also staffed with persons of relevant qualifications and experience. The Internal Audit reports directly to the AC chairman, and administratively to the Chairman and CEO. The internal auditors have unfettered access to all the Group s documents, records, properties and personnel, including access to the AC. The key role of the Internal Audit is to promote effective internal controls in the Group and to monitor the performance and effective application of internal controls procedures. The Internal Audit carries out its function according to the standard set by internationally recognised professional bodies. The AC is satisfied that the Company s internal audit function is adequately resourced and effective. SHAREHOLDER RIGHTS AND RESPONSIBILITIES PRINCIPLE 14: SHAREHOLDER RIGHTS All Shareholders are treated fairly and equitably to facilitate the exercise of their ownership rights. In-line with continuous disclosure obligations of the Company, the Board s policy is that Shareholders be informed promptly of any major development that may have a material impact on the Group s performance and affect the price or value of the Company s shares. Information is communicated to Shareholders on a timely basis, through annual reports that are to be issued to all Shareholders within the mandatory period, quarterly financial statements announcements, press releases and other relevant announcements via SGXNET. The Company does not practice selective disclosure. All the general meetings of Shareholders are held in Singapore to ensure that Shareholders have the opportunity to participate and vote at the general meetings. Shareholders are informed of the relevant rules including procedures that govern general meetings of Shareholders. PRINCIPLE 15: COMMUNICATION WITH SHAREHOLDERS DG: Guideline 15.4 DG: Guideline 15.5 The Company has a team of investor relations staff to promote regular, effective and fair communication with Shareholders and investors. In addition to disclosing relevant information of the Group via SGXNET as set out above, the Company also operates its corporate website at through which Shareholders will be able to access updated information on the Group. The website provides corporate announcements, press releases and other information of the Group. The Group participated in activities such as global investor conferences, analyst briefings and roadshows to solicit and understand the views of the Shareholders and investors. A brief write-up of the Group s investor relations activities can be found in the 2016 Annual Report. Declaration of dividends, if any, are clearly communicated to Shareholders and where dividends are not paid, explanations are given to the Shareholders too. Such communications with Shareholders are made via SGXNET announcements.

166 160 YANLORD LAND GROUP LIMITED CORPORATE GOVERNANCE STATEMENT PRINCIPLE 16: CONDUCT OF SHAREHOLDER MEETINGS All registered Shareholders are invited to participate and given the right to vote on resolutions at general meetings. Each of the Shareholders would be given a CD Rom containing the annual report, notice of the general meeting and proxy form. The printed copies of the annual report are available to the Shareholders upon their requests. Notices of general meetings are published on the press and issued by way of an announcement via SGXNET. If any individual Shareholder is unable to attend the general meeting in person, he / she may appoint not more than two proxies in accordance with the provision of the Constitution for the proxies to attend and vote on his / her behalf at the general meeting. A member of the Company who is a relevant intermediary (as defined in Section 181(6) of the Act is entitled to appoint more than two proxies to attend and vote in general meetings pursuant to Section 181(1C) of the Act. At the general meetings, Shareholders will be given the opportunity to express their views and make enquiries regarding the business and operations of the Group. Voting in absentia by mail, facsimile or is currently not allowed as such voting methods would need to be cautiously evaluated for feasibility to ensure that there is no compromise to the integrity of the information and the authenticity of the Shareholders identity. Separate resolutions are proposed for substantially separate issues at the general meetings. In FY2016, all directors on board including our four independent directors and the external auditors attended the annual general meeting of the Company held on 28 April The directors always strive to attend all general meetings of Shareholders to address Shareholders queries. Since 2015, all resolutions at its all general meetings have been voted by way of an electronic poll so as to better reflect shareholders interest and to ensure transparency in the voting process. The voting outcome for each resolution was presented to the Shareholders in real-time at the general meetings immediately after each resolution was put to vote and the outcomes of all resolutions were subsequently disclosed in accordance with the prescribed format pursuant to Chapter 7 of the Listing Manual via SGXNET. Company prepared minutes of the general meetings in accordance with the recommendation of the Code. DEALINGS IN SECURITIES The Company has adopted and implemented an internal compliance code to provide guidance to its directors and key employees in relation to the dealings in its securities issued by the SGX. Directors and key employees who have access to material price sensitive information are prohibited from dealing in securities of the Company prior to the announcement of such information. They are also prohibited from dealing in the Company s securities one month prior to the announcement of the Company s full year financial statements and two weeks before the announcement of the Company s financial statements for each of the first three quarters of its financial year, and are further prohibited from dealing in the Company s securities on short-term considerations.

167 NOTICE OF ANNUAL GENERAL MEETING 161 ANNUAL REPORT 2016 NOTICE IS HEREBY GIVEN that an Annual General Meeting ( AGM ) of Yanlord Land Group Limited ( Company or Yanlord ) will be held on Thursday, 27 April 2017 at 2.00 p.m. at Capricorn and Leo, Marina Mandarin Singapore, Level 1, 6 Raffles Boulevard, Marina Square, Singapore to transact the following business: AS ROUTINE BUSINESS 1. To receive and adopt the directors statement and the audited financial statements for the financial year ended 31 December 2016 together with the auditors report thereon. (Resolution 1) 2. To declare a first and final (one-tier) tax-exempt dividend of 4.35 Singapore cents (equivalent to approximately Renminbi cents) per ordinary share for the year ended 31 December (Resolution 2) 3. To approve the payment of Directors Fees of S$400,000 (equivalent to approximately RMB1,915,920) for the year ended 31 December 2016 (FY2015: S$400,000, equivalent to approximately RMB1,816,830). (Resolution 3) 4. To re-elect the following Directors, each of whom will retire pursuant to Regulation 91 of the Constitution of the Company and who, being eligible, offer themselves for re-election: a) Ronald Seah Lim Siang (Resolution 4a) b) Ng Ser Miang (Resolution 4b) c) Zhong Sheng Jian (Resolution 4c) (Detailed information of these Directors can be found in the Company s Annual Report 2016, under the section of the Board of Directors.) 5. To re-elect Zhong Ming, a Director who is retiring pursuant to Regulation 97 of the Constitution of the Company and who, being eligible, offers himself for re-election. (Resolution 5) (Detailed information of Zhong Ming can be found in the Company s Annual Report 2016, under the section of the Board of Directors.) 6. To re-appoint Messrs Deloitte & Touche LLP, Singapore as Auditors of the Company and to authorise the Directors to fix their remuneration. (Resolution 6) AS SPECIAL BUSINESS 7. To consider and, if thought fit, to pass with or without any amendments, the following resolutions as Ordinary Resolutions: 7A. That pursuant to Section 161 of the Companies Act, Cap. 50 ( Act ) and the Listing Manual of the Singapore Exchange Securities Trading Limited ( SGX-ST ), authority be and is hereby given to the Directors of the Company to:- (a) (i) allot and issue shares in the capital of the Company ( Shares ) whether by way of rights, bonus or otherwise; and / or (ii) make or grant offers, agreements or options (collectively, Instruments and each, an Instrument ) that might or would require Shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) warrants, debentures or other instruments convertible into Shares, at any time and upon such terms and conditions and for such purposes and to such persons as the Directors may, in their absolute discretion, deem fit; and

168 162 YANLORD LAND GROUP LIMITED NOTICE OF ANNUAL GENERAL MEETING (b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue Shares in pursuance of any Instrument made or granted by the Directors while this Resolution was in force, provided that: (1) the aggregate number of Shares to be issued pursuant to this Resolution (including Shares to be issued in pursuance of Instruments made or granted pursuant to this Resolution) does not exceed fifty per cent. (50%) of the total number of issued Shares excluding treasury shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of Shares to be issued other than on a pro rata basis to shareholders of the Company (including Shares to be issued in pursuance of Instruments made or granted pursuant to this Resolution) does not exceed twenty per cent. (20%) of the total number of issued Shares excluding treasury shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below); (2) (subject to such manner of calculation as may be prescribed by SGX-ST) for the purpose of determining the aggregate number of Shares that may be issued under sub-paragraph (1) above, the percentage of the total number of issued Shares excluding treasury shares shall be based on the total number of issued Shares excluding treasury shares in the capital of the Company at the time this Resolution is passed, after adjusting for:- (i) (ii) new Shares arising from the conversion or exercise of any convertible securities or share options on issue at the time this Resolution is passed; and any subsequent bonus issue, consolidation or subdivision of Shares; 7B. That:- (3) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Act, the Listing Manual of SGX-ST for the time being in force (unless such compliance has been waived by the SGX-ST) and the Constitution for the time being of the Company; and (4) (unless revoked or varied by the Company in general meeting) the authority conferred by this Resolution shall continue in force until the conclusion of the next AGM of the Company or the date by which the next AGM is required by law to be held, whichever is earlier. (Resolution 7) (1) for the purposes of sections 76C and 76E of the Act, the exercise by the Directors of the Company of all the powers of the Company to purchase or acquire issued and fully paid Shares not exceeding in aggregate the Maximum Percentage (as defined below), at such price or prices as may be determined by the Directors from time to time up to the Maximum Price (as defined below), whether by way of:- (a) (b) market purchases on the SGX-ST ( Market Purchase ); and / or off-market purchases (if effected otherwise than on the SGX-ST) in accordance with any equal access scheme(s) as may be determined or formulated by the Directors as they consider fit, which scheme(s) shall satisfy all the conditions prescribed by the Act ( Off-Market Purchase ), and otherwise in accordance with all other laws, regulations and rules of the SGX-ST as may for the time being applicable, be and is hereby authorised and approved generally and unconditionally ( Share Buyback Mandate );

169 NOTICE OF ANNUAL GENERAL MEETING 163 ANNUAL REPORT 2016 (2) unless varied or revoked by the members of the Company in general meeting, the authority conferred on the Directors of the Company pursuant to the Share Buyback Mandate may be exercised by the Directors at any time and from time to time during the period commencing from the date of the passing of this Resolution and expiring on the earlier of:- (a) (b) the date on which the next AGM of the Company is held; or the date by which the next AGM of the Company is required by law to be held. In this Resolution:- Maximum Percentage means that number of issued Shares representing not more than 10% of the total number of issued Shares as at date of the passing of this Resolution (excluding any Shares which are held as treasury shares as at that date); Maximum Price in relation to a Share to be purchased or acquired, means the purchase price (excluding brokerage, commission, applicable goods and services tax, stamp duties, clearance fees and other related expenses) not exceeding:- (i) (ii) in the case of a Market Purchase, 105% of the Average Closing Price of the Shares; and in the case of an Off-Market Purchase, 120% of the Average Closing Price of the Shares; Average Closing Price means the average of the closing prices of a Share over the last five (5) market days on which the Shares are transacted on the SGX-ST or, as the case may be, such securities exchange on which the Shares are listed or quoted, immediately preceding the date of the Market Purchase by the Company or, as the case may be, the date of the making of the offer pursuant to the Off-Market Purchase, and deemed to be adjusted, in accordance with the rules of the SGX-ST, for any corporate action that occurs after the relevant five-day period; and date of the making of the offer means the date on which the Company makes an offer for the purchase or acquisition of Shares from shareholders, stating therein the relevant terms of the equal access scheme for effecting the Off-Market Purchase. (3) the Directors of the Company and / or any of them be and are hereby authorised to complete and do all such acts and things (including executing all such documents as may be required) as they and / or he may consider expedient or necessary or in the interests of the Company to give effect to the transactions contemplated and / or authorised by this Resolution. (Resolution 8) 8. To transact any other ordinary business which may properly be transacted at an annual general meeting.

170 164 YANLORD LAND GROUP LIMITED NOTICE OF ANNUAL GENERAL MEETING NOTICE OF BOOKS CLOSURE AND DIVIDEND PAYMENT DATES NOTICE IS ALSO HEREBY GIVEN THAT the Share Transfer Book and Register of Members of the Company will be closed on 23 May 2017, for the purpose of determining the shareholders entitlements to the first and final (one-tier) tax-exempt dividend of 4.35 Singapore cents (equivalent to approximately Renminbi cents) per ordinary share for the year ended 31 December 2016 ( Proposed Dividend ) to be proposed at the AGM of the Company to be held on 27 April Duly completed registrable transfers in respect of Shares of the Company received by the Company s Share Registrar, Boardroom Corporate & Advisory Services Pte. Ltd., of 50 Raffles Place, Singapore Land Tower #32-01, Singapore up to 5.00 p.m. on 22 May 2017 will be registered to determine shareholders entitlements to the Proposed Dividend. Shareholders whose securities accounts with the Central Depository (Pte) Limited are credited with Shares as at 5.00 p.m. on 22 May 2017 will be entitled to the Proposed Dividend. The Proposed Dividend, if approved at the forthcoming AGM, will be paid on 5 June BY ORDER OF THE BOARD Lim Poh Choo Company Secretary 10 April 2017 Singapore Notes to Notice of AGM: (i) A member of the Company who is not a Relevant Intermediary and entitled to attend and vote at the AGM is entitled to appoint not more than two proxies to attend and vote on his behalf. (ii) A member of the Company who is a Relevant Intermediary and entitled to attend and vote at the AGM is entitled to appoint more than two proxies to attend and vote, but each proxy must be appointed to exercise the rights attached to a different share or shares held by such member. Where such member s form of proxy appoints more than two proxies, the number and class of Shares in relation to which each proxy has been appointed shall be specified in the form of proxy. Relevant Intermediary has the meaning ascribed to it in Section 181 of the Act. (iii) A proxy need not be a member of the Company. (iv) The instrument appointing a proxy must be deposited at the registered office of the Company at 9 Temasek Boulevard #36-02 Suntec Tower Two Singapore not less than 48 hours before the time fixed for holding the AGM. (v) Resolution 4a: Ronald Seah Lim Siang who is the lead independent director will, upon re-appointment as a Director of the Company, remain as Chairman of the Audit Committee, member of the Nominating Committee and member of the Remuneration Committee. (vi) Resolution 4b: Ng Ser Miang who is an independent director will, upon re-appointment as a Director of the Company, remain as Chairman of the Nominating Committee and member of the Risk Management Committee. (vii) Resolution 7, if passed, is to empower the Directors from the date of the AGM to be held on 27 April 2017 until the date of next AGM, to issue Shares and to make or grant instruments (such as warrants or debentures) convertible into Shares, and to issue Shares in pursuance of such instruments, up to a number not exceeding in total fifty per cent. (50%) of the total number issued Shares excluding treasury shares in the capital of the Company with a sub-limit of twenty per cent. (20%) for issues other than on a pro-rata basis to shareholders (calculated as described above). (viii) Resolution 8 relates to the renewal of the Share Buyback Mandate which was originally approved by shareholders on 2 April Please refer to Appendix I to this Notice of AGM for details. Personal Data Privacy: By attending the AGM and / or any adjournment thereof and / or submitting an instrument appointing a proxy(ies) and / or representative(s) to attend, speak and vote at the AGM and / or any adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the member s personal data by the Company (or its agents or service providers) for the purpose of the processing and administration by the Company (or its agents or service providers) of proxies and representatives appointed for the AGM (including any adjournment thereof) and the preparation and compilation of the attendance lists, minutes and other documents relating to the AGM (including any adjournment thereof), and in order for the Company (or its agents or service providers) to comply with any applicable laws, listing rules, regulations and / or guidelines (collectively, the Purposes ), and (ii) warrants that where the member discloses the personal data of the member s proxy(ies) and / or representative(s) to the Company (or its agents or service providers), the member has obtained the prior consent of such proxy(ies) and / or representative(s) for the collection, use and disclosure by the Company (or its agents or service providers) of the personal data of such proxy(ies) and / or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of any penalties, liabilities, claims, demands, losses and damages as a result of the member s breach of warranty.

171 YANLORD LAND GROUP LIMITED (Incorporated in the Republic of Singapore) Company Registration No K PROXY FORM ANNUAL GENERAL MEETING IMPORTANT: 1. A Relevant Intermediary may appoint more than two proxies to attend and vote at the Annual General Meeting (Please refer to Note 3 for the details). 2. This Proxy Form is not valid for use by CPF / SRS Investors and shall be ineffective for all intents and purposes if used or purported to be used by them. CPF / SRS investors should contact their respective Agent Banks If they have any queries regarding their appointment as proxies. I / We (Name) of (Address) being a member / members of Yanlord Land Group Limited (the Company or Yanlord ) hereby appoint: (a) Name Address NRIC / Passport Number Proportion of Shareholdings No. of Shares % and / or (delete as appropriate) (b) Name Address NRIC / Passport Number Proportion of Shareholdings No. of Shares % or failing him / her, the Chairman of the annual general meeting of the Company ( AGM ) to be held at Capricorn and Leo, Marina Mandarin Singapore, Level 1, 6 Raffles Boulevard, Marina Square, Singapore on Thursday, 27 April 2017 at 2.00 p.m. and at any adjournment thereof, as my / our proxy / proxies to attend and vote for me / us on my / our behalf at the AGM. Note: In compliance with Rule 730A(2) of the SGX Mainboard Listing Rules, the Chairman of the AGM will be exercising his right under Regulation 61(i) of the Constitution of the Company to demand a poll in respect of each of the resolutions to be put to the vote of members of the Company at the AGM and at any adjournment thereof. Accordingly, each resolution at the AGM will be voted on by way of a poll. No. Ordinary Resolutions ROUTINE BUSINESS 1 Adoption of Directors Statement, Auditor s Report and Accounts 2 Declaration of Dividend 3 Approval of Directors Fees 4 (a) Re-election of Ronald Seah Lim Siang as Director (b) Re-election of Ng Ser Miang as Director (c) Re-election of Zhong Sheng Jian as Director 5 Re-election of Zhong Ming as Director 6 Re-appointment of Auditors SPECIAL BUSINESS 7 Authority for Directors to issue shares and convertible securities 8 Renewal of Share Buyback Mandate No. of Votes For* Against* * If you wish to exercise all your votes For or Against, please tick ( ) within the relevant box provided. Alternatively, please indicate the number of votes as appropriate. In the absence of specific directions, each proxy will vote or abstain as the proxy deems fit. Dated this day of 2017 Total number of Shares held Signature(s) or Common Seal of Member(s) IMPORTANT: PLEASE READ NOTES TO PROXY FORM ON THE REVERSE

172 Fold this flap for sealing PROXY FORM Affix Stamp Here THE COMPANY SECRETARY YANLORD LAND GROUP LIMITED 9 Temasek Boulevard #36-02 Suntec Tower Two Singapore Fold here Fold here NOTES TO PROXY FORM: 1. Please insert the total number of shares held by you. If you have shares entered against your name in the Depository Register (as defined in Section 81SF of the Securities and Future Act, Cap. 289), you should insert that number. If you have shares registered in your name in the Register of Members of the Company, you should insert that number. If you have shares entered against your name in the Depository Register and registered in your name in the Register of Members, you should insert the aggregate number. If no number is inserted, this form of proxy will be deemed to relate to all the shares held by you. 2. A member of the Company who is not a Relevant Intermediary and entitled to attend and vote at the AGM is entitled to appoint not more than two proxies to attend and vote on his behalf. Where a member appoints more than one proxy, the appointments shall be invalid unless he specifies the proportion of his holding (expressed as a percentage of the whole) to be represented by each proxy. 3. A member of the Company who is a Relevant Intermediary and entitled to attend and vote at the AGM is entitled to appoint more than two proxies to attend and vote, but each proxy must be appointed to exercise the rights attached to a different share or shares held by such member. Where such member s form of proxy appoints more than two proxies, the number and class of shares in relation to which each proxy has been appointed shall be specified in the form of proxy. Relevant Intermediary has the meaning ascribed to it in Section 181 of the Companies Act, Cap A proxy need not be a member of the Company. 5. The instrument appointing a proxy or proxies shall, in the case of an individual, be signed by the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its common seal or signed on its behalf by an attorney or a duly authorised officer of the corporation. 6. Where an instrument appointing a proxy is signed on behalf of the appointor by an attorney, the letter or power of attorney or a duly certified copy thereof must (failing previous registration with the Company) be lodged with the instrument of proxy, failing which the instrument may be treated as invalid. 7. A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks fit to act as its representative at the AGM, in accordance with Section 179 of the Companies Act, Cap The Company shall be entitled to reject an instrument appointing a proxy / proxies which is incomplete, improperly completed, illegible or where the true intentions of the appointor is not ascertainable from the instructions of the appointor contained in the instrument of proxy. In addition, in the case of shares entered in the Depository Register, the Company may reject an instrument of proxy if the member, being the appointor, is not shown to have shares entered against his name in the Depository Register as at 72 hours before the time fixed for holding the AGM, as certified by The Central Depository (Pte) Limited to the Company. 9. The instrument appointing a proxy or proxies must be deposited at the Company s registered office at 9 Temasek Boulevard #36-02 Suntec Tower Two Singapore not less than 48 hours before the time fixed for the AGM. 10. By submitting an instrument appointing a proxy(ies) and / or representative(s), the member accepts and agrees to the personal data privacy terms set out in the Notice of AGM dated 10 April Completion and return of this instrument appointing proxy shall not preclude a member from attending and voting at the AGM. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the AGM in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy, to the AGM.

173 Sanya Hai Tang Bay Land Parcel 9 三亚海棠湾 9 号地块

174 YANLORD Yanlord Land Group Limited Registration No K 9 Temasek Boulevard #36-02 Suntec Tower Two Singapore Tel: (65) Fax: (65) This annual report has been produced by a printer certified according to the standards from the Forest Stewardship Council TM (FSC TM ), and has been printed on environmentallyfriendly paper in accordance to the FSC standard.