Shuangliang Eco-Energy changes accounting estimates for intercompany receivables

Shuangliang Eco-Energy Systems Co. has decided to change its accounting estimates for bad debt provisions on intercompany receivables. This change, adopted under the prospective application method, will not retroactively adjust previously disclosed financial reports and will not impact the company's financial position or operating results for prior years. The decision was approved by the company's board of directors and its audit committee, negating the need for shareholder approval.

Previously, the company provisioned for bad debts on intercompany receivables within consolidated financial statements using an aging analysis method. The revised accounting estimate mandates that intercompany receivables within consolidated financial statements undergo individual impairment testing. Bad debt provisions will only be made if objective evidence of impairment exists, calculated as the difference between the present value of estimated future cash flows and the carrying amount.

This adjustment is driven by the increasing scale and frequency of intercompany transactions across the company's business segments. The change aims to more accurately reflect the company's financial health and operating performance, providing investors with more reliable accounting information and aligning with the "Accounting Standards for Business Enterprises."