HUANENG POWER INTERNATIONAL INC | CIK:0000929058 |

Filed: 4/12/2018

Entity registrant name: HUANENG POWER INTERNATIONAL INC (CIK: 0000929058)

Generator: Unknown

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36	Related party balances and transactions

The related parties of the Company and its subsidiaries that had transactions with the Company and its subsidiaries are as follows:

 

Names of related parties		Nature of relationship
Huaneng Group		Ultimate parent company
HIPDC		Parent company
Huaneng Energy & Communications Holdings Co., Ltd. and its subsidiaries		Subsidiaries of Huaneng Group*
Huaneng Property Co., Ltd. and its subsidiaries		Subsidiaries of Huaneng Group
Xi'an Thermal and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Group Technology Innovation Center		A subsidiary of Huaneng Group
Huaneng Hulunbuir Energy Development Company Ltd.and its subsidiaries		Subsidiaries of Huaneng Group
Alltrust Insurance Co., Ltd.		A subsidiary of Huaneng Group
North United Power Co., Ltd. and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Group Clean Energy Technology Research Institute Co., Ltd.		A subsidiary of Huaneng Group
Huaneng Renewables Corporation Limited and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Carbon Assets Management Company Limited		A subsidiary of Huaneng Group
Huaneng Group Hong Kong Limited Company		A subsidiary of Huaneng Group
Huaneng Lancangjiang Hydropower Co., Inc. and its subsidiaries		Subsidiaries of Huaneng Group
Changping Huaneng Training Center		A subsidiary of Huaneng Group
Huaneng Hainan Industry Co.,Ltd.		A subsidiary of Huaneng Group
Huaneng Baishan Coal Gangue Power Generation Co., Ltd.		A subsidiary of Huaneng Group
Great Wall Securities Co., Ltd. ("Great Wall Securities")		A subsidiary of Huaneng Group
Huaneng Nuclear Power Development Company Ltd.		A subsidiary of Huaneng Group
Huaneng Tibet Yarlung Zangbo River Hydropower Development & Investment Company Ltd. and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Xining Power Co., Ltd.		A subsidiary of Huaneng Group
Huaneng Coal Business Sector Co., Ltd. and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Integrated Industries Co., Ltd.		A subsidiary of Huaneng Group
Huaneng Ningxia Energy Company Ltd.		A subsidiary of Huaneng Group
Huaneng Shaanxi Power Generation Limited and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Xinjiang Energy Development Company Ltd. and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Gansu Energy Development Company Ltd. and its subsidiaries		Subsidiaries of Huaneng Group
Huaneng Capital Services Co., Ltd.		A subsidiary of Huaneng Group
Huaneng Shaanxi Qinling Power Generation Co., Ltd.		A subsidiary of Huaneng Group
Ningxia Daba Power Generation Co., Ltd.		A subsidiary of Huaneng Group
Huaneng Shandong Shidao Bay Nuclear Power Co., Ltd.		A subsidiary of Huaneng Group
Huangtai #8 Power Plant		An investee with significant influence
Shanghai Time Shipping		A joint venture of the Company
Jiangsu Nantong Power		A joint venture of the Company
Huaneng Yingkou Port Limited Liability Company		A joint venture of the Company
Luyi Power		A joint venture of the Company
Ruyi (Hong Kong) Energy and its subsidiaries		Joint ventures of the Company
Suzhou Sugao Renewables Service Co. Ltd.		A joint venture of the Company
Liaocheng Luxi Fuel Co., Ltd.Company		An associate of the Company
Zhengzhou Airport Xinggang Power Co., Ltd.		An associate of the Company

 

 

*

Transactions with subsidiaries of Huaneng Group which also are associates of the Company and its subsidiaries are presented as transactions with subsidiaries of Huaneng Group for note 36(a) and 36(b).

**

Huaneng Group is a state-owned enterprise. In accordance with the revised IAS 24, "Related Party Disclosures", government-related enterprises, other than entities under Huaneng Group, which the PRC government has control, joint control or significant influence over are also considered as related parties of the Company and its subsidiaries ("other government-related enterprises").

The majority of the business activities of the Company and its subsidiaries are conducted with other government-related enterprises. For the purpose of the related party balances and transactions disclosure, the Company and its subsidiaries have established procedures to determine, to the extent possible, the identification of the ownership structure of its customers and suppliers as to whether they are government-related enterprises. However, many government-related enterprises have a multi-layered corporate structure and the ownership structures change over time as a result of transfers and privatization programs. Nevertheless, management believes that all material related party balances and transactions have been adequately disclosed.

In addition to the related party information shown elsewhere in these financial statements, the following is a summary of significant related party transactions entered into in the ordinary course of business between the Company and its subsidiaries and their related parties during the year and significant balances arising from related party transactions as at year end.

(a)

Related party balances

(i)

Cash deposits in related parties

 

		As at 31 December
		2017				2016
Deposits in Huaneng Finance
- Savings deposit			7,506,706				5,155,000
Deposits in Great Wall Securities
- Savings deposit			-				2
Total			7,506,706				5,155,002

 

For the year ended 31 December 2017, the annual interest rates for these savings deposits placed with Huaneng Finance and Great Wall Securities ranged from 0.35% to 1.35% (2016: from 0.35% to 1.35%).

(ii)

As described in Note 24 and 30, certain loans of the Company and its subsidiaries were borrowed from Huaneng Group, HIPDC, Huaneng Finance, Xi'an Thermal, a subsidiary of Huaneng Energy & Communications Holdings Co., Ltd. and Tiancheng Financial Leasing.

(iii)

Except for those disclosed in Note 24 and 30, the majority of the balances with Huaneng Group, HIPDC, subsidiaries of Huaneng Group, associates, joint ventures and other related parties are unsecured and within one year. As at and for the years ended 31 December 2017 and 2016, no provision is made on receivable balances from these parties.

Accounts receivable, other receivables and assets comprised the following balances due from related parties:

 

		As at 31 December
		2017				2016
Due from Huaneng Group			860,941				708
Due from HIPDC			99				-
Due from joint ventures			360,442				806,112
Due from associates			89,083				-
Due from subsidiaries of Huaneng Group			196,621				319,224
Due from Huangtai #8 Power Plant			903,671				-
Total			2,410,857				1,126,044

 

(iv)

Accounts payable and other liabilities and other non-current liabilities comprised the following balances due to related parties:

 

(v)

As at 31 December 2017, included in long-term loans (including current portion) and short-term loans are loans payable to other government-related enterprises amounting to RMB203 billion (2016: RMB130 billion).

The balances with government-related enterprises also included substantially all the accounts receivable due from domestic power plants of government-related power grid companies, the bank deposits placed with government-related financial institutions as well as accounts payables and other payables arising from the purchases of coal and property, plant and equipment construction and related labor service provided by other government-related enterprises. Except for bank deposits, these balances are unsecured and the majority of receivable/repayable is within one year.

(vi)

As at 31 December 2017, prepayment for construction materials to subsidiaries of Huaneng Group amounted to RMB21 million (2016: RMB67 million).

(b)

Related party transactions

(i)

Procurement of goods and receiving services

 

		For the year ended 31 December
		2017				2016				2015
Huaneng Group
Technical services and engineering contracting services			-				-				50
Other purchases			446				451				-
Subsidiaries of Huaneng Group
Purchase of coal and transportation services			19,945,752				17,212,984				16,575,700
Technical services and engineering contracting services			1,024,369				1,055,251				769,176
Purchase of equipment			347,163				483,058				302,387
Purchase of power generation quota			-				195,528				287,779
Other purchases			716				6,472				7,073
Joint ventures of the Company
Purchase of coal and transportation services			2,054,209				2,150,844				1,816,954
Entrusting other parties for power generation			28,953				-				-
An associate of the Company Other purchases			27,732				43,808				44,591

 

(ii)

Sales of goods and providing services

 

		For the year ended 31 December
		2017				2016				2015
Huaneng Group
Service provided			907				-				-
HIPDC
Service provided			520				-				-
Subsidiaries of Huaneng Group
Sales of power generation quota			-				1,165				135,085
Sales of goods			1,114,347				-				-
Other sales			15,247				189,914				40,780
Service provided			25,229				31,135				50,627
Provision of entrusted power generation			58,639				-				-
Joint ventures of the Company
Service provided			319,844				59,049				133,332
Other sales			407,697				9,490				23,003
Other related party
Provision of entrusted power generation			-				-				33,129

 

(iii)

Other related party transactions

 

					For the year ended 31 December
					2017				2016				2015
	(1	)	Rental charge on leasehold
			HIPDC			106,885				157,264				161,941
			Subsidiaries of Huaneng Group			141,542				128,932				130,591
			A joint venture of the Company			2,128				-				-
	(2	)	Rental income from leasehold
			A joint venture of the Company			7,448				7,750				10,759
			Subsidiaries of Huaneng Group			2,509				5,724				9,115
	(3	)	Drawdown of loans
			Subsidiaries of Huaneng Group			15,374,480				4,035,000				2,660,500
			HIPDC			-				210				-
			Huaneng group			665,225				-				-
	(4	)	Interest expense on loans
			Huaneng group			33,481				30,514				32,573
			HIPDC			10				13,136				114,687
			Subsidiaries of Huaneng Group			589,012				217,098				158,695
	(5	)	Interest income on loans
			A joint venture of the Company			3,329				3,488				4,572
			An associate of the Company			917				-				-
			A Subsidiary of Huaneng Group			4,344				-				-

 

					For the year ended 31 December
					2017				2016				2015
	(6	)	Capital injection from a subsidiary of Huaneng Group
			A subsidiary of Huaneng Group			274,752				-				286,312
	(7	)	Capital injection
			A subsidiary of Huaneng Group			-				157,500				683,550
			An associate of the Company			52,200				100,418				206,230
			Joint ventures of the Company			249,716				18,200				-
	(8	)	Pre-construction cost paid by
			A subsidiary of Huaneng Group			23,529				765				12,254
			An joint venture of the Company			179				-
	(9	)	Finance lease payments received from
			A subsidiary of Huaneng Group			-				2,960,000				100,000
	(10	)	Entrusted management fee
			Huaneng Group			13,453				24,950				24,950
	(11	)	Trusteeship management income
			Huaneng Group			1,518				1,700				1,700
	(12	)	Net proceeds received from investee with significant influence
			Huangtai #8 Power Plant			72,920				-				-
	(13	)	Finance lease to investee with significant influence
			Huangtai #8 Power Plant			86,946				-				-
	(14	)	Interest income from finance lease
			Huangtai #8 Power Plant			11,626				-				-
	(15	)	Acquisition consideration
			In 2017, the Company acquired subsidiaries from Huaneng Group, please refer to Note 40(a) for details of the acquisition consideration.
	(16	)	Disposal subsidiaries
			In 2017, the Company disposed Taishan Power Limited Company to a subsidiary of Huaneng Group, please refer to Note 6 for details.

 

(c)

Guarantees

 

					As at 31 December
					2017				2016
	(i	)	Long-term loans guaranteed by
			- Huaneng Group			1,675,147				565,992
			- HIPDC			2,099,600				2,142,000
	(ii	)	Long-term bonds guaranteed by
			- HIPDC			4,000,000				4,000,000
			- Government-related banks			-				3,300,000

 

(d)

Pre-tax benefits and social insurance of key management personnel

 

(e)

Related party commitments

Related party commitments which were contracted but not recognized in the consolidated statement of financial position as at the end of reporting period are as follows:

 

(i)

Capital commitments

 

(ii)

Fuel purchase and transportation commitments

 

(iii)

Operating lease commitments