New Daxin: Announcement on the decision to order corrective measures

The company and all board members guarantee the truthfulness, accuracy and completeness of the information disclosure, and there are no false records, misleading statements or major omissions.

Henan Xinda New Materials Co., Ltd. (hereinafter referred to as “the company”) received the China Securities Regulatory Commission Henan Supervision Bureau (hereinafter referred to as “Henan Securities Regulatory Bureau”) on September 27, 2013. “About Henan Xinda New Materials Co., Ltd. The company has taken the decision to order corrective measures ([2013] No. 13, hereinafter referred to as "Responsible for Correction Decision"). The company will now announce the main contents of the "Responsible for Correction Decision" as follows:

In 2013, our bureau conducted a comprehensive on-site inspection of your company and found that your company has the following problems:

(1) Problems in corporate governance

1. There are cases where the purchase of wealth management products and entrusted loans have not fulfilled the decision-making procedures, have not been announced, and have not been accounted for in the correct accounting subjects. In 2011-2012, the company purchased a total of 177 million yuan of wealth management products, and entrusted loans of 50 million yuan in 2011. It has not fulfilled relevant decision-making procedures, has not announced, and has been accounted for in other monetary funds. It has not been accounted for through short-term investment or transactional financial funds. It complies with Article 107 of the Guidelines for Listed Companies, Article 30 of the Measures for the Administration of Information Disclosure of Listed Companies and the Relevant Provisions of the Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of Financial Instruments.

2. The existence of shareholders and directors entrusted to participate in the general meeting of shareholders and the board of directors does not comply with the provisions of Articles 61, 62 and 121 of the Guidelines for Listed Companies.

(2) Problems in information disclosure

1. There are some cases in which the resolution of the board of directors that should be disclosed is not announced. At the 7th meeting of the second board of directors, the company applied for a comprehensive credit of 200 million yuan to Everbright Bank to meet the disclosure standards, but did not announce it, and did not comply with the provisions of Article 30 of the Measures for the Administration of Information Disclosure of Listed Companies.

2. The company has a situation in which individual information disclosure is inconsistent with the actual situation. For example, when the 11th meeting of the second board of directors issues the notice time and the meeting time, the announcement time is inconsistent with the actual time; the external guarantee amount disclosed in the company's 2013 semi-annual report is 80 million yuan, but the actual external guarantee amount is 90 million yuan. It does not comply with the provisions of Article 2 of the Measures for the Administration of Information Disclosure of Listed Companies.

(3) Financial management issues

1. The company's cash management is not standardized. It has not been completed in the past few days. The cash red letter appeared in January 2011 and does not comply with the provisions of Article 12 of the Interim Regulations on Cash Management.

2. The company records the uncosted repair expenses into the manufacturing expenses, and does not comply with the provisions of Article 6 of the Accounting Standards No. 4 - Fixed Assets.

3. Some items in the financial statements are not listed accurately. The prepaid land, equipment and construction funds are listed in the prepayments and other receivables, and are not adjusted to other non-current assets; the individual current accounts are offset after being listed, resulting in less recognition of assets, liabilities, and less Provision for bad debts, on December 31, 2011, the company will directly offset the accounts receivable of Yingli Energy (China) Co., Ltd. and the advance receipts of Baoding Tianwei Yingli New Energy Co., Ltd., resulting in less confirmation of assets of 247.474 million yuan. Confirmation of liabilities 2474.74, less provision for bad debts of RMB 1,247,400, not in accordance with Articles 13 and 14 of the “Accounting Standards for Business Enterprises No. 30 – Presentation of Financial Statements” and Article 12 of the “Accounting Standards for Business Enterprises – Basic Standards” Provisions.

4. There are individual confirmations of inventories in advance, resulting in a situation where the inventory at the end of the period does not match. For example, in June 2011, 80 million yuan of waste mortar was purchased and the quantity was 15,195 tons. The company handled the storage, but there were still 2,475 tons of unsold goods at the end of 2011, which did not meet the requirements of Article 4 of the Accounting Standards No. 1 - Inventory.

(4) Issues concerning the registration and management of insider information insiders

1. Insider information insiders are not signed and confirmed in the insider information registration form, and are all registered by the staff of the Securities Department, which does not comply with the provisions of Article 10 of the “Regulations on the Establishment of Insider Information Registration System for Listed Companies”.

2. The company's insider insider registration is not timely or incomplete, and does not comply with the provisions of Article 7 of the “Regulations on the Establishment of Insider Information Registration Management System for Listed Companies”.

In accordance with Article 21 of the Measures for On-site Inspection of Listed Companies, Article 59 of the Measures for the Administration of Information Disclosure of Listed Companies, and Article 15 of the Provisions on the Registration and Management of Insiders of Listed Companies Order your company to correct, require your company to immediately stop the above violations, and correct it before December 31, 2013, and meet the following requirements: corporate governance norms; sound internal control; information disclosure is true, accurate, complete, timely; financial management specification. The board of directors should conscientiously study relevant laws and regulations, propose practical rectification measures and rectification plans for the above problems, and submit a written rectification report to the bureau within 30 days from the date of receipt of this decision. The bureau will carry out the rectification and effect of the company. Inspection and acceptance.

If you are dissatisfied with this supervision and management measure, you may file an application for administrative reconsideration with the China Securities Regulatory Commission within 60 days from the date of receipt of this decision, or you may have jurisdiction within 3 months from the date of receipt of this decision. The people's court filed a lawsuit. During the reconsideration and litigation, the above supervision and management measures will not be suspended.

In response to the above-mentioned problems found in the on-site inspection work of the Henan Securities Regulatory Bureau, the company will carefully study relevant laws and regulations in accordance with the requirements of the Henan Securities Regulatory Bureau, and conduct a comprehensive inspection of corporate governance, internal control, information disclosure, and financial management to find out the existence. Insufficient and hidden dangers, in strict accordance with the provisions of the "Listed Companies on-site inspection measures", seriously implement rectification and form a rectification report.

Special announcement.

Henan Xinda New Materials Co., Ltd. Board of Directors

September 30, 2013

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