Meeting Overview - The 16th meeting of the 9th Supervisory Board of Zhejiang Wufangzhai Industrial Co., Ltd. was held on August 28, 2025, with all 5 supervisors present [1] - The meeting was chaired by the Chairman of the Supervisory Board, Hu Jianmin, and complied with relevant laws, regulations, and the company's articles of association [1] Resolutions Passed - The Supervisory Board approved the "2025 Half-Year Report and its Summary," confirming that the report's preparation and review processes met legal and regulatory requirements, and accurately reflected the company's financial status, operational results, and cash flows without any false statements or omissions [1][2] - The Supervisory Board also approved the "Special Report on the Storage and Use of Raised Funds for the First Half of 2025," stating that the use of raised funds complied with relevant regulations and did not harm shareholder interests, with disclosures being truthful and complete [2]

Group 1 - The company held its 13th meeting of the second board on August 26, 2025, with all 9 directors present, including 3 independent directors [3][4] - The board approved the proposal to cancel the supervisory board and amend the company's articles of association, which will be submitted to the shareholders' meeting for approval [4][5] - The board also approved the company's 2025 semi-annual report, confirming that the report accurately reflects the company's financial status and operational results [8][9] Group 2 - The supervisory board held its 11th meeting on August 26, 2025, with all 3 supervisors present, and confirmed the legality of the meeting procedures [16][17] - The supervisory board approved the company's 2025 semi-annual report and the special report on the storage and use of raised funds, affirming compliance with relevant regulations [18][20] - Both reports will be disclosed on the company's official information platform [9][20]

Core Viewpoint - Regulatory authorities are intensifying scrutiny on non-operational fund occupation and related violations among listed companies, aiming to enhance corporate governance and protect investor interests [1][2][3]. Group 1: Regulatory Actions - Beijing Oriental Yuhong Waterproof Technology Co., Ltd. received warnings from the Beijing Securities Regulatory Bureau and the Shenzhen Stock Exchange for non-operational fund occupation and financial irregularities [1]. - Nearly 40 companies have faced penalties this year due to fund occupation, with significant cases involving undisclosed non-operational fund occupation by related parties [2]. - Regulatory measures include administrative penalties and warnings, with a focus on improving corporate governance and compliance with fundraising regulations [1][4]. Group 2: Fund Occupation Issues - The primary reasons for penalties include undisclosed non-operational fund occupation by related parties and large-scale fund occupation by controlling shareholders [2]. - Companies like Weichuang Group and *ST Huamei have faced fines and corrective measures for failing to disclose fund occupation in a timely manner [2]. - The regulatory framework has been strengthened to prevent fund occupation and ensure proper use of raised funds, with new rules emphasizing transparency and accountability [3][4]. Group 3: Corporate Governance - Good corporate governance is essential for high-quality listed companies, ensuring decision-making transparency and protection of shareholder rights [5]. - The China Securities Regulatory Commission (CSRC) has introduced new guidelines to enhance governance standards, including restrictions on controlling shareholders' access to company assets [3][4]. - Analysts emphasize the need for improved governance capabilities among management and the importance of independent directors and auditors in maintaining market confidence [5].

Core Viewpoint - The inquiry letter from the Shanghai Stock Exchange regarding the information disclosure of Jinhua Enterprise (Group) Co., Ltd. highlights issues related to the use of raised funds and project management, particularly concerning the new factory relocation and expansion project [1][2]. Group 1: Fundraising and Project Management - The company raised 628 million yuan through a private placement, with 480 million yuan allocated for the new factory relocation and expansion project. As of the end of 2024, 369 million yuan had been invested in this project [1]. - A contract was signed with Shaanxi Hongyuan Zhenye Industrial Co., Ltd. for the renovation and minor works of the public areas of the pharmaceutical plant, with an initial payment of 18 million yuan made [1][2]. - The inquiry raised concerns about the management of raised funds and project budgets, specifically regarding the prepayment of large engineering amounts and whether there was any disguised fund occupation [1][2]. Group 2: Contractual Details and Payment Terms - The contract with Shaanxi Hongyuan includes specific construction content, a bill of quantities, acceptance standards, and payment schedule [2][3]. - The payment schedule stipulates that 80% of the payment is made based on the completed work verified by the project owner, with payments made by the 10th of each month for the previous month's work [4]. - The company has made significant prepayments exceeding 5 million yuan for various projects, including a prepayment of 42 million yuan for a total project cost of 280 million yuan, and 10 million yuan for another project [4][5]. Group 3: Supplier Relationships and Compliance - The company provided details on the latest fund usage for the investment projects, totaling 393.13 million yuan, which includes engineering costs, equipment costs, and other related expenses [2][4]. - Among the top suppliers in the past two years, some did not follow the bidding procedures, particularly Shaanxi Hongyuan and Shaanxi Fuhuihui Decoration Engineering Co., Ltd. [7][8]. - The company confirmed that the main suppliers do not have any direct or indirect relationships with the actual controllers or other shareholders, except for Shaanxi Juchi Construction Engineering Monitoring Co., Ltd., which is an associated party [9][10].