Announcement of the China Securities Regulatory Commission [2008] No.4 3

T o ensure the quality of the financial information disclosed by listed companies, the   companies  that   plan  initial public offering and listing , and other c ompanies  p ublicly  i ssuing  s ecurities ,  the China Securities Regulatory Commission (CSRC) has  amended  the "Q&A No.1 on Information Disclosure Regulations for Companies Offering  T heir Securities to the Public  - - Extraordinary Profit and Loss" (Amendment in 2007)  and renamed it as the  “Explanatory Announcement No.1 on Information Disclosure for Companies Offering  T heir Securities to the Public” ,  which  is  hereby promulgated .  L isted companies shall disclose extraordinary profit and loss in the  financial  report of 2008 according to the Announcement  since  December 1, 2008. Companies that plan listing shall implement it as of the announcement day.

October  31, 2008

Explanatory Announcement on Information Disclosure for Companies Offering  T heir Securities to the Public

No.1  --  Extraordinary Profit and Loss  (2008)

1. Definition of extraordinary profit and loss

Extraordinary profit and loss  arises  in various trading and issues that have no direct relation with the normal operations of a company, or that are related with normal operations but affect the users of the statement to make  reasonable  judgment of the company ’ s operation performance and profitability due to the special and occasional nature of such trading and issues.

2. Extraordinary profit and loss usually include the following items:

(1) profit and loss from disposal of non-floating assets, including the offset part of the  retained  asset  impairment provisions ; 

(2) unauthorized examination and approval, or lack of official approval documents, or occasional tax revenue return and abatement;

(3) governmental subsidies counted into the current profit and loss, except for the one closely related with the normal operation of the company and gained constantly at a fixed amount or quantity according to certain standard based on state policies;

(4) capital occupation fees charged to the non-financial enterprises and counted into the current profit and loss;

(5)   gains when the investment cost of acquiring a subsidy, an  allied  enterprise and a joint venture is less than  the fair value of the identifiable net assets  of the invested entity;

(6) profit and loss from  non-monetary assets exchange ;

(7) profit and loss from entrusting others for investment or asset management;

(8)  retained  asset  impairment provisions  resulting from force majeure such as natural disasters;

(9) profit and loss from  debt reorganization

(10) enterprises ’  reorganization fees, such as staffing expenses and integration fees;

(11)   profit   and  loss  that exceeds the  fair value  in transaction with unfair price;

(12) current net profit and loss of the subsidies established by merger of enterprises under unified control from the beginning of the period to the merger day;

(13) profit   and  loss  on contingency that has no relation with the normal operation of the company;

(14) profit  or loss  from  change in fair value  by holding  tradable financial assets  and liabilities, and investment income from disposal of  tradable financial assets  and liabilities as well as salable financial assets, excluding the effective hedging businesses related with the normal operations of the company;

(15)  switch -back of impairment provisions of accounts receivable that have undergone impairment test alone;

(16) profit and loss from outward entrusted loaning;

(17) profit and loss   from the change of  investment property’ s fair value by follow-up  measurement  in  fair value  mode;

(18) impact on the current profit and loss by one-off adjustment to the current profit and loss according to the requirements of the tax as well as accounting laws and rules;

(19)  custody fees  of entrusted operation;

(20) other non-operating income and expenses besides the above items; and

(21) other items that conform to the definition of extraordinary profit and loss.

3. Companies shall, when compiling prospectus, periodical reports or application materials of securities issue, by referring to the definition of extraordinary profit and loss, take into full consideration the relations and sustainability of relevant profit and loss with the normal operation of the companies, so as to make reasonable judgment and full disclosure with regard to their actual conditions.

4. Companies shall add necessary notes to the content of significant extraordinary profit and loss items besides disclosing the items and amounts of extraordinary profit and loss.

5. If companies define the extraordinary profit and loss items listed herein as  recurring profit and loss  items based on the  “ other items that conform to the definition of extraordinary profit and loss ”  as well as the nature and characteristics of their normal operational business, they shall make  separate  explanations in the  notes .

6. If the profits and  losses of a small number of shareholders or their income taxes are  affected, the companies shall, when calculating the financial indicators related with extraordinary profit and loss, deduct relevant data.

7. Certified public accountants shall, when issuing audit or examination reports for financial reports in companies ’  prospectus, periodical reports and application materials for securities issue, pay due attention to the extraordinary profit and loss items, amounts and notes, and verify the truthfulness, accuracy, completeness and reasonableness of the disclosed extraordinary profit and loss as well as the explanations.

8.  L isted companies shall disclose extraordinary profit and loss in their  financial  reports of 2008 according to the Announcement  since  December 1, 2008. Companies that plan listing shall implement it as of the announcement day.