Orient Securities: Special explanation provided regarding issues related to the reorganization review inquiry letter

Orient Securities announced that KPMG Huazhen LLP issued a special report on the review inquiry letter regarding the company's issuance of shares and payment of cash to acquire 100% equity of Shanghai Securities, which constitutes a related-party transaction. This transaction is a combination not under common control, with a consideration of RMB 25.120 billion, of which RMB 23.550 billion is paid in shares and RMB 1.570 billion in cash, and the pro forma statements indicate newly recognized goodwill of RMB 4.843 billion. As of March 31, 2026, the pro forma book value of goodwill after the transaction is RMB 4.875 billion, accounting for 4.50% of net assets attributable to the parent and 0.78% of total assets. If goodwill is impaired, it will affect current-period profit. The company will advance integration and conduct impairment tests on schedule. The accountant's review concludes that the accounting treatment of this goodwill complies with the standards.