Document And Entity Information
Document And Entity Information | 12 Months Ended |
Dec. 31, 2023 shares | |
Document Information Line Items | |
Entity Registrant Name | FANHUA INC. |
Document Type | 20-F |
Current Fiscal Year End Date | --12-31 |
Entity Common Stock, Shares Outstanding | 1,134,236,184 |
Amendment Flag | false |
Entity Central Index Key | 0001413855 |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Filer Category | Accelerated Filer |
Entity Well-known Seasoned Issuer | No |
Document Period End Date | Dec. 31, 2023 |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | FY |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
ICFR Auditor Attestation Flag | true |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity File Number | 001-33768 |
Entity Incorporation, State or Country Code | E9 |
Entity Address, Address Line One | 60/F |
Entity Address, Address Line Two | Pearl River Tower |
Entity Address, Address Line Three | No. 15 West Zhujiang Road |
Entity Address, City or Town | Guangzhou, Guangdong |
Entity Address, Postal Zip Code | 510623 |
Entity Address, Country | CN |
Entity Interactive Data Current | Yes |
Document Financial Statement Error Correction [Flag] | false |
Document Accounting Standard | U.S. GAAP |
Auditor Firm ID | 1113 |
Auditor Name | Deloitte Touche Tohmatsu |
Auditor Location | Shenzhen, the People’s Republic of China |
Business Contact | |
Document Information Line Items | |
Entity Address, Address Line One | 60/F |
Entity Address, Address Line Two | Pearl River Tower |
Entity Address, Address Line Three | No. 15 West Zhujiang Road |
Entity Address, City or Town | Guangzhou, Guangdong |
Entity Address, Postal Zip Code | 510623 |
Entity Address, Country | CN |
Contact Personnel Name | Peng Ge |
City Area Code | +86 20 |
Local Phone Number | 83883033 |
Contact Personnel Email Address | gepeng@fanhgroup.com |
Contact Personnel Fax Number | 86 20 83883181 |
Ordinary shares, par value US$0.001 per share | |
Document Information Line Items | |
Trading Symbol | FANH |
Title of 12(b) Security | Ordinary shares, par value US$0.001 per share |
Security Exchange Name | NASDAQ |
American depositary shares, each representing 20 ordinary shares | |
Document Information Line Items | |
Title of 12(b) Security | American depositary shares, each representing 20 ordinary shares |
Security Exchange Name | NASDAQ |
No Trading Symbol Flag | true |
Consolidated Balance Sheets
Consolidated Balance Sheets ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Current assets: | |||
Cash and cash equivalents | ¥ 521,538 | $ 73,457 | ¥ 567,525 |
Restricted cash (including restricted cash of the consolidated VIEs and VIEs’ subsidiaries that can only be used to settle obligations of the VIEs of RMB15,832 and RMB14,942 as of December 31, 2022 and 2023, respectively) | 53,238 | 7,498 | 59,957 |
Short term investments (including investments measured at fair value of RMB331,228 and RMB925,678 as of December 31, 2022 and 2023, respectively) | 928,270 | 130,744 | 347,754 |
Accounts receivable, net of allowances of RMB15,361 and RMB15,650 as of December 31, 2022 and 2023, respectively | 279,912 | 39,425 | 393,600 |
Contract assets, net of allowances of nil and RMB36 as of December 31, 2022 and 2023, respectively | 359,506 | 50,635 | 273,954 |
Other receivables, net | 111,754 | 15,740 | 231,049 |
Other current assets, net | 121,347 | 17,092 | 419,735 |
Total current assets | 2,375,565 | 334,591 | 2,293,574 |
Non-current assets: | |||
Restricted bank deposit – non-current (including restricted cash of the consolidated VIEs and VIEs’ subsidiaries that can only be used to settle obligations of the VIEs of RMB11,283 and RMB9,107 as of December 31, 2022 and 2023, respectively) | 27,228 | 3,835 | 20,729 |
Contract assets - non-current, net of allowances of nil and RMB98 as of December 31, 2022 and 2023, respectively | 711,424 | 100,202 | 385,834 |
Property, plant, and equipment, net | 91,659 | 12,910 | 98,459 |
Intangible assets, net | 58,316 | 8,214 | |
Goodwill, net | 374,149 | 52,698 | 109,997 |
Deferred tax assets | 40,735 | 5,737 | 20,402 |
Investments in affiliates | 4,035 | ||
Other non-current assets | 235,752 | 33,205 | 11,400 |
Right of use assets | 136,056 | 19,163 | 145,086 |
Total non-current assets | 1,675,319 | 235,964 | 795,942 |
Total assets | 4,050,884 | 570,555 | 3,089,516 |
Current liabilities: | |||
Short-term loans | 164,300 | 23,141 | 35,679 |
Accounts payable (including accounts payable of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB8,600 and RMB2,020 as of December 31, 2022 and 2023, respectively) | 251,249 | 35,388 | 362,352 |
Accrued commissions (including accrued commissions of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB nil and RMB471 as of December 31, 2022 and 2023, respectively) | 155,558 | 21,910 | 74,432 |
Insurance premium payables (including insurance premium payables of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB16,571 and RMB14,817 as of December 31, 2022 and 2023, respectively) | 14,943 | 2,105 | 16,580 |
Other payables and accrued expenses (including other payables and accrued expenses of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB3,267 and RMB3,864 as of December 31, 2022 and 2023, respectively) | 185,999 | 26,197 | 174,326 |
Accrued payroll (including accrued payroll of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB10,941 and RMB8,173 as of December 31, 2022 and 2023, respectively) | 94,305 | 13,283 | 96,279 |
Income taxes payable (including income taxes payable of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB7,509 and RMB7,416 as of December 31, 2022 and 2023, respectively) | 100,260 | 14,121 | 130,024 |
Current operating lease liability (including current operating lease liability of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB3,569 and RMB3,236 as of December 31, 2022 and 2023, respectively) | 57,164 | 8,051 | 62,304 |
Total current liabilities | 1,023,778 | 144,196 | 951,976 |
Non-current liabilities: | |||
Accrued commissions – non-current (including accrued commissions of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB nil and RMB1,579 as of December 31, 2022 and 2023, respectively) | 401,385 | 56,534 | 192,917 |
Other tax liabilities (including other tax liability of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB26,147 and RMB22,184 as of December 31, 2022 and 2023, respectively) | 34,368 | 4,841 | 36,647 |
Deferred tax liabilities (including deferred tax liability of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB nil and RMB4,118 as of December 31, 2022 and 2023, respectively) | 149,151 | 21,008 | 102,455 |
Non-current operating lease liability (including non-current operating lease liability of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB1,386 and nil as of December 31, 2022 and 2023, respectively) | 71,311 | 10,044 | 74,190 |
Other non-current liabilities (including other non-current liability of the consolidated VIEs and VIEs’ subsidiaries without recourse to the Company of RMB nil and RMB552 as of December 31, 2022 and 2023, respectively) | 33,373 | 4,700 | |
Total non-current liabilities | 689,588 | 97,127 | 406,209 |
Total liabilities | 1,713,366 | 241,323 | 1,358,185 |
Commitments and contingencies | |||
Equity: | |||
Ordinary shares (Authorized shares:10,000,000,000 at US$0.001 each; issued 1,074,291,784 and 1,158,913,224 shares, of which 1,072,842,484 and 1,134,236,184 shares were outstanding as of December 31, 2022 and 2023, respectively) | 8,675 | 1,222 | 8,091 |
Treasury stock | (178) | (25) | (10) |
Additional paid-in capital | 162,721 | 22,919 | 461 |
Statutory reserves | 608,376 | 85,688 | 559,520 |
Retained earnings | 1,319,605 | 185,862 | 1,087,984 |
Accumulated other comprehensive loss | (27,936) | (3,935) | (32,643) |
Total shareholders’ equity | 2,071,263 | 291,731 | 1,623,403 |
Noncontrolling interests | 266,255 | 37,501 | 107,928 |
Total equity | 2,337,518 | 329,232 | 1,731,331 |
Total liabilities and shareholders’ equity | ¥ 4,050,884 | $ 570,555 | ¥ 3,089,516 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Restricted cash | ¥ 14,942 | ¥ 15,832 |
Short term investments | 925,678 | 331,228 |
Accounts receivable, net of allowances | 15,650 | 15,361 |
Contract assets, net of allowances | 36 | |
Restricted bank deposit | 9,107 | 11,283 |
Non-current, net of allowances | 98 | |
Accounts payable | 2,490 | 8,600 |
Accrued commissions | 471 | |
Insurance premium payables | 14,817 | 16,571 |
Other payables and accrued expenses | 3,864 | 3,267 |
Accrued payroll | 8,173 | 10,941 |
Income taxes payable | 7,416 | 7,509 |
Current operating lease liability | 3,236 | 3,569 |
Accrued commissions | 1,579 | |
Other tax liabilities | 22,184 | 26,147 |
Deferred tax liabilities | 4,118 | |
Non-current operating lease liability | 1,386 | |
Other non-current liabilities | ¥ 552 | |
Ordinary shares, Authorized (in Shares) | 10,000,000,000 | 10,000,000,000 |
Ordinary shares, par value (in Dollars per share and Yuan Renminbi per share) | ¥ 0.001 | ¥ 0.001 |
Ordinary shares, issued (in Shares) | 1,158,913,224 | 1,074,291,784 |
Ordinary shares, outstanding (in Shares) | 1,134,236,184 | 1,072,842,484 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) ¥ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) ¥ / shares shares | Dec. 31, 2021 CNY (¥) ¥ / shares shares | ||
Net revenues: | |||||
Agency | ¥ 2,760,448 | $ 388,801 | ¥ 2,376,851 | ¥ 2,811,936 | |
Life insurance business | 2,593,803 | 365,330 | 2,237,312 | 2,679,720 | |
P&C insurance business | 166,645 | 23,471 | 139,539 | 132,216 | |
Claims adjusting | 437,941 | 61,683 | 404,763 | 459,178 | |
Total net revenues | 3,198,389 | 450,484 | 2,781,614 | 3,271,114 | |
Operating costs and expenses: | |||||
Agency | (1,868,672) | (263,197) | (1,527,572) | (1,835,825) | |
Life insurance business | (1,749,475) | (246,408) | (1,436,606) | (1,742,640) | |
P&C insurance business | (119,197) | (16,789) | (90,966) | (93,185) | |
Claims adjusting | (276,744) | (38,979) | (268,031) | (279,342) | |
Total operating costs | (2,145,416) | (302,176) | (1,795,603) | (2,115,167) | |
Selling expenses | (250,223) | (35,243) | (272,706) | (306,463) | |
General and administrative expenses | (606,925) | (85,484) | (544,630) | (547,579) | |
Total operating costs and expenses | (3,002,564) | (422,903) | (2,612,939) | (2,969,209) | |
Income from operations | 195,825 | 27,581 | 168,675 | 301,905 | |
Other income, net: | |||||
Gains from fair value change | 102,867 | 14,489 | |||
Investment income related to the realized gain on available-for-sale investments | 49,106 | 6,917 | 17,809 | 32,898 | |
Interest income, net | 5,690 | 801 | 13,674 | 2,971 | |
Others, net | (3,670) | (517) | (3,823) | 33,314 | |
Income before income taxes, share of income and impairment of affiliates, net | 349,818 | 49,271 | 196,335 | 371,088 | |
Income tax expense | (59,402) | (8,367) | (41,016) | (90,574) | |
Share of income of affiliates, net of impairment | (1,317) | (185) | (69,596) | (20,573) | |
Net income | 289,099 | 40,719 | 85,723 | 259,941 | |
Less: net income (loss) attributable to the noncontrolling interests | 8,622 | 1,215 | (14,549) | 8,952 | |
Net income attributable to the Company’s shareholders | ¥ 280,477 | $ 39,504 | ¥ 100,272 | ¥ 250,989 | |
Basic (in Dollars per share and Yuan Renminbi per share) | (per share) | ¥ 0.26 | $ 0.04 | ¥ 0.09 | ¥ 0.23 | |
Diluted (in Dollars per share and Yuan Renminbi per share) | (per share) | ¥ 0.26 | $ 0.04 | ¥ 0.09 | ¥ 0.23 | |
Basic (in Shares) | [1] | 1,074,372,067 | 1,074,372,067 | 1,074,196,310 | 1,073,891,784 |
Diluted (in Shares) | 1,076,740,198 | 1,076,740,198 | 1,074,457,821 | 1,074,291,194 | |
Foreign currency translation adjustments | ¥ 2,249 | $ 317 | ¥ 3,728 | ¥ (9,116) | |
Unrealized net gains (loss) on available-for-sale investments | 2,458 | 346 | (1,919) | 6,252 | |
Share of other comprehensive (loss) gain of affiliates | 4,688 | (1,281) | |||
Total comprehensive income | 293,806 | 41,382 | 92,220 | 255,796 | |
Less: Comprehensive income (loss) attributable to the noncontrolling interests | 8,622 | 1,215 | (14,549) | 8,952 | |
Comprehensive income attributable to the Company’s shareholders | ¥ 285,184 | $ 40,167 | ¥ 106,769 | ¥ 246,844 | |
[1] The weighted average number of ordinary shares outstanding excludes the number of ordinary shares issued in business combinations occurred in 2023 through an exchange of equity interests that are treated in the same manner as contingently issuable shares because the holders must return all or part if all necessary conditions have not been satisfied by the end of the period. |
Consolidated Statements of Shar
Consolidated Statements of Shareholders’ Equity ¥ in Thousands, $ in Thousands | Share Capital CNY (¥) shares | Share Capital USD ($) shares | Additional Paid-in Capital CNY (¥) | Additional Paid-in Capital USD ($) | Treasury Stock CNY (¥) shares | Treasury Stock USD ($) shares | Statutory Reserves CNY (¥) | Statutory Reserves USD ($) | Retained Earnings CNY (¥) | Retained Earnings USD ($) | Accumulated Other Comprehensive Loss CNY (¥) | Accumulated Other Comprehensive Loss USD ($) | Noncontrolling Interests CNY (¥) | Noncontrolling Interests USD ($) | CNY (¥) | USD ($) |
Balance (in Dollars) | ¥ 8,089 | ¥ 553,911 | ¥ 1,306,554 | ¥ (34,995) | ¥ 121,105 | ¥ 1,954,664 | ||||||||||
Balance (in Shares) | shares | 1,073,891,784 | 1,073,891,784 | ||||||||||||||
Balance at Dec. 31, 2020 | ¥ 8,089 | 553,911 | 1,306,554 | (34,995) | 121,105 | 1,954,664 | ||||||||||
Balance (in Shares) at Dec. 31, 2020 | shares | 1,073,891,784 | 1,073,891,784 | ||||||||||||||
Net income (loss) | 250,989 | 8,952 | 259,941 | |||||||||||||
Foreign currency translation | (9,116) | (9,116) | ||||||||||||||
Provision for statutory reserves | 3,310 | (3,310) | ||||||||||||||
Distribution of dividend | (242,518) | (7,580) | (250,098) | |||||||||||||
Unrealized net gain on available-for-sale investments | 6,252 | 6,252 | ||||||||||||||
Share of other comprehensive gain of affiliates | (1,281) | (1,281) | ||||||||||||||
Balance at Dec. 31, 2021 | ¥ 8,089 | 557,221 | 1,311,715 | (39,140) | 122,477 | 1,960,362 | ||||||||||
Balance (in Shares) at Dec. 31, 2021 | shares | 1,073,891,784 | 1,073,891,784 | ||||||||||||||
Balance (in Dollars) | ¥ 8,089 | 557,221 | 1,311,715 | (39,140) | 122,477 | 1,960,362 | ||||||||||
Balance (in Shares) | shares | 1,073,891,784 | 1,073,891,784 | ||||||||||||||
Net income (loss) | 100,272 | (14,549) | 85,723 | |||||||||||||
Exercise of share options | ¥ 2 | 2 | ||||||||||||||
Exercise of share options (in Shares) | shares | 400,000 | 400,000 | ||||||||||||||
Repurchase of ordinary shares from open market | ¥ (10) | (3,974) | (3,984) | |||||||||||||
Repurchase of ordinary shares from open market (in Shares) | shares | 1,449,300 | 1,449,300 | ||||||||||||||
Share-based compensation | 461 | 461 | ||||||||||||||
Cash dividend | (52,069) | (52,069) | ||||||||||||||
Pro rata distribution of equity method investee’s shares to shareholders (Note 9) | (265,661) | (265,661) | ||||||||||||||
Foreign currency translation | 3,728 | 3,728 | ||||||||||||||
Provision for statutory reserves | 2,299 | (2,299) | ||||||||||||||
Unrealized net gain on available-for-sale investments | (1,919) | (1,919) | ||||||||||||||
Share of other comprehensive gain of affiliates | 4,688 | 4,688 | ||||||||||||||
Share of other comprehensive gain of affiliates (in Shares) | shares | ||||||||||||||||
Balance at Dec. 31, 2022 | ¥ 8,091 | 461 | ¥ (10) | 559,520 | 1,087,984 | (32,643) | 107,928 | 1,731,331 | ||||||||
Balance (in Shares) at Dec. 31, 2022 | shares | 1,074,291,784 | 1,074,291,784 | 1,449,300 | 1,449,300 | ||||||||||||
Balance (in Dollars) | ¥ 8,091 | 461 | ¥ (10) | 559,520 | 1,087,984 | (32,643) | 107,928 | 1,731,331 | ||||||||
Balance (in Shares) | shares | 1,074,291,784 | 1,074,291,784 | 1,449,300 | 1,449,300 | ||||||||||||
Net income (loss) | 280,477 | 8,622 | 289,099 | $ 40,719 | ||||||||||||
Ordinary shares issued for business combinations (Note 3) | ¥ 584 | 208,906 | 169,771 | 379,261 | ||||||||||||
Ordinary shares issued for business combinations (Note 3) (in Shares) | shares | 84,621,440 | 84,621,440 | ||||||||||||||
Repurchase of ordinary shares from open market | (28,968) | ¥ (75) | (29,043) | |||||||||||||
Repurchase of ordinary shares from open market (in Shares) | shares | 10,528,820 | 10,528,820 | ||||||||||||||
Repurchase of ordinary shares from certain selling shareholder (Note 17) | (8,720) | ¥ (25) | (8,745) | |||||||||||||
Repurchase of ordinary shares from certain selling shareholder (Note 17) (in Shares) | shares | 3,591,780 | 3,591,780 | ||||||||||||||
Ordinary shares received upon disposal of a newly acquired subsidiary (Note 3 and Note 17) | (24,452) | ¥ (68) | (21,557) | (46,077) | ||||||||||||
Ordinary shares received upon disposal of a newly acquired subsidiary (Note 3 and Note 17) (in Shares) | shares | 9,107,140 | 9,107,140 | ||||||||||||||
Share-based compensation | 17,095 | 17,095 | ||||||||||||||
Acquisition of non-controlling interests of a subsidiary | (1,601) | 1,491 | (110) | |||||||||||||
Foreign currency translation | 2,249 | 2,249 | ||||||||||||||
Provision for statutory reserves | 48,856 | (48,856) | ||||||||||||||
Unrealized net gain on available-for-sale investments | 2,458 | 2,458 | 346 | |||||||||||||
Share of other comprehensive gain of affiliates | ||||||||||||||||
Balance at Dec. 31, 2023 | ¥ 8,675 | $ 1,222 | 162,721 | $ 22,919 | ¥ (178) | $ (25) | 608,376 | $ 85,688 | 1,319,605 | $ 185,862 | (27,936) | $ (3,935) | 266,255 | $ 37,501 | 2,337,518 | 329,232 |
Balance (in Shares) at Dec. 31, 2023 | shares | 1,158,913,224 | 1,158,913,224 | 24,677,040 | 24,677,040 | ||||||||||||
Balance (in Dollars) | ¥ 8,675 | $ 1,222 | ¥ 162,721 | $ 22,919 | ¥ (178) | $ (25) | ¥ 608,376 | $ 85,688 | ¥ 1,319,605 | $ 185,862 | ¥ (27,936) | $ (3,935) | ¥ 266,255 | $ 37,501 | ¥ 2,337,518 | $ 329,232 |
Balance (in Shares) | shares | 1,158,913,224 | 1,158,913,224 | 24,677,040 | 24,677,040 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Cash flows from operating activities: | ||||
Net income | ¥ 289,099 | $ 40,719 | ¥ 85,723 | ¥ 259,941 |
Adjustments to reconcile net income to net cash generated from operating activities: | ||||
Depreciation expense | 16,192 | 2,281 | 19,473 | 18,342 |
Amortization of intangible assets | 17,858 | 2,515 | 45 | |
Non-cash operating lease expense | 69,689 | 9,816 | 90,419 | 101,448 |
(Reversal of) provision for allowance for credit losses on financial assets | 24,647 | 3,471 | 30,701 | (235) |
Share-based compensation expenses | 17,095 | 2,408 | 461 | |
Loss on disposal of property, plant and equipment | 1,311 | 185 | 2,825 | 1,394 |
Change in fair value of equity investments | (96,217) | (13,552) | ||
Change in fair value of contingent consideration | (6,650) | (937) | ||
Investment income | (17,047) | (2,401) | (10,963) | (3,171) |
Net (gain) loss on disposal of subsidiaries | 2,904 | 409 | (2,051) | |
Share of (income) of affiliates, net of impairment | 1,317 | 185 | 69,596 | 20,573 |
Deferred taxes | 14,544 | 2,048 | 27,845 | 23,905 |
Interest accrued for other receivables (loan receivables) | (3,537) | (498) | (3,353) | |
Changes in operating assets and liabilities: | ||||
Accounts receivable | 196,422 | 27,665 | (1,491) | (5,528) |
Contract assets | (327,419) | (46,115) | (204,249) | (257,182) |
Insurance premium receivables | (16) | (2) | ||
Other receivables | 9,034 | 1,272 | 37,262 | (31,066) |
Other current assets | 8,576 | 1,208 | 8,623 | 1,201 |
Other non-current assets | (4,933) | (695) | (51) | 2,284 |
Accounts payable | (362,066) | (50,996) | 22,099 | (37,104) |
Accrued commissions | 364,026 | 51,272 | 127,643 | 139,706 |
Insurance premium payables | (1,637) | (231) | (7,375) | (1,367) |
Other payables and accrued expenses | (2,115) | (298) | (16,264) | (131) |
Accrued payroll | (8,799) | (1,239) | (15,771) | 6,265 |
Income taxes payable | (29,947) | (4,218) | (262) | (15,880) |
Lease liability | (68,265) | (9,615) | (88,573) | (101,186) |
Other tax liabilities | (2,279) | (321) | (36,566) | 5,995 |
Net cash generated from operating activities | 101,787 | 14,336 | 137,752 | 126,198 |
Cash flows from investing activities: | ||||
Purchase of short term investments | (4,399,910) | (619,714) | (2,550,300) | (8,184,363) |
Proceeds from disposal of short term investments | 4,226,001 | 595,220 | 3,239,556 | 8,646,532 |
Purchase of long-term investments | (135,462) | (19,080) | ||
Purchase of property, plant and equipment | (12,996) | (1,830) | (77,746) | (30,785) |
Proceeds from disposal of property and equipment | 3,047 | 429 | 3,799 | 1,025 |
Cash paid out for loan receivables from third parties | (160,000) | (22,536) | (205,800) | |
Cash received for loan receivables from third parties | 229,000 | 32,254 | 24,500 | 6,830 |
Prepayment for purchase of short-term investments | (540,000) | |||
Payment for business acquisitions, net of cash acquired | 18,452 | 2,599 | (21,571) | |
Proceeds as guarantee deposits from certain shareholders in business combinations | 33,373 | 4,701 | ||
Payment as guarantee deposits to certain shareholders in business combinations | (33,373) | (4,701) | ||
Others | (2,440) | (344) | 11,160 | |
Net cash generated from (used in) investing activities | (234,308) | (33,002) | (127,562) | 450,399 |
Cash flows from financing activities: | ||||
Proceeds from bank borrowings | 182,301 | 25,677 | 35,679 | |
Repayment of bank borrowings and other borrowings | (62,789) | (8,844) | ||
Dividends paid | (52,069) | (242,518) | ||
Dividend distributed to noncontrolling interest | (7,580) | |||
Capital contribution from non-controlling interests | 7,330 | 1,032 | ||
Repurchase of ordinary shares from open market | (40,556) | (5,712) | (3,984) | |
Others | (110) | (15) | 3 | (10,200) |
Net cash (used in) generated from financing activities | 86,176 | 12,138 | (20,371) | (260,298) |
Net increase (decrease) in cash and cash equivalents, and restricted cash | (46,345) | (6,528) | (10,181) | 316,299 |
Cash and cash equivalents and restricted cash at beginning of year | 648,211 | 91,299 | 656,522 | 350,098 |
Cash and cash equivalents and restricted cash at the end of the year | 602,004 | 84,790 | 648,211 | 656,522 |
Reconciliation in amounts on the consolidated balance sheets: | ||||
Cash and cash equivalents at the end of the year | 521,538 | 73,457 | 567,525 | 564,624 |
Restricted cash at the end of the year | 80,466 | 11,333 | 80,686 | 91,898 |
Total of cash and cash equivalents and restricted cash at the end of the year | 602,004 | 84,790 | 648,211 | 656,522 |
Supplemental disclosure of cash flow information: | ||||
Income taxes paid | 76,879 | 10,828 | 47,029 | 74,323 |
Interests paid | 8,750 | 1,232 | ||
Supplemental disclosure of non-cash investing activities: | ||||
Right-of-use assets obtained in exchange for lease obligations, net of decrease of right-of-use assets for early terminations | 57,233 | 8,061 | 4,462 | 125,487 |
Acquisition of subsidiaries through issuing ordinary shares | (203,657) | (28,684) | ||
Supplemental disclosure of non-cash financing activities: | ||||
Dividend distribution in equity method investee’s shares | 265,661 | |||
Effect of exchange rate changes on cash and cash equivalents | ¥ 138 | $ 19 | ¥ 1,870 | ¥ (9,875) |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2023 | |
Organization and Description of Business [Abstract] | |
Organization and Description of Business | (1) Organization and Description of Business Fanhua Inc. (the “Company”) (formally known as “CNinsure Inc.”) was incorporated in the Cayman Islands on April 10, 2007 and listed on the Nasdaq on October 31, 2007. The Company, its subsidiaries and the consolidated variable interest entities (the “VIEs”) are collectively referred to as the “Group”. The Group is principally engaged in the provision of agency services and insurance claims adjusting services in the People’s Republic of China (the “PRC”). On December 27, 2023, securities exchange agreements (the “Agreements”) were entered into by and among Highest Performances Holdings Inc. (“HPH”, formerly known as “Puyi Inc.”) and certain shareholders of the Company (the “Selling Shareholders”). Upon the terms and subject to the conditions of the Agreements, HPH issued and allotted to the Selling Shareholders an aggregate of 284,113,314 HPH ordinary shares, and in exchange therefor, the Selling Shareholders sold to HPH an aggregate of 568,226,628 ordinary shares of the Company they beneficially owned (the “Transaction through Exchange of Equity Interests”). The transaction was closed on December 31, 2023. As a result of the Transaction through Exchange of Equity Interests, HPH owns approximately 50.07% of the Company’s equity interests. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies (a) Basis of Presentation and Consolidation The consolidated financial statements of the Group have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The consolidated financial statements include the financial statements of the Company, all its subsidiaries and those VIEs of which the Company is the primary beneficiary from the dates they were acquired or incorporated. All intercompany balances and transactions have been eliminated in consolidation. In order to comply with the PRC laws and regulations which prohibit or restrict foreign control of companies involved in provision of internet content and other restricted businesses, the Group operates certain of its businesses which are subject to restrictions in the PRC through PRC domestic companies, whose equity interests are held by certain individuals (“Nominee Shareholders”). The Group obtained control over these PRC domestic companies by entering into a series of contractual arrangements with these PRC domestic companies and their respective Nominee Shareholders. Management concluded that these PRC domestic companies are consolidated VIEs of the Group, of which the Group is the primary beneficiary. As such, the Group consolidated the financial results of these PRC domestic companies and their subsidiaries in the Group’s consolidated financial statements. See Note 12 for details. (b) Use of Estimates The preparation of the consolidated financial statements in conformity with US GAAP requires management of the Group to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. The Group evaluates estimates, including those related to the amounts of variable considerations of revenue contracts with respect to long-term life insurance products, the allowance for credit losses of accounts receivable, contract assets and other receivables, fair values of identifiable assets acquired, liabilities assumed and consideration transferred in business combinations, share-based payments and certain debt and equity investments, the useful lives of intangible assets and property, plant and equipment, impairment of long-lived assets, goodwill, and other long-term equity investments, and deferred tax valuation allowance among others. The Group, based their estimates on historical experience and various other factors, believed to be reasonable under the circumstances, that the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. (c) Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents consist of cash on hand, bank deposits and short-term, highly liquid investments, which have original maturities of three months or less, and that are readily convertible to known amounts of cash and have insignificant risk of changes in value related to changes in interest rates. In its capacity as an insurance agent, the Group collects premiums from the insureds and remits the premiums to the appropriate insurance companies. Accordingly, as reported in the consolidated balance sheets, “premiums” are receivables from the insureds of RMB15,847 and RMB14,986 as of December 31, 2022 and 2023, respectively. Unremitted net insurance premiums are held in a fiduciary capacity until disbursed by the Group. The Group invests these unremitted funds only in cash accounts held for a short term and reports such amounts as restricted cash in the consolidated balance sheets. Also, restricted cash balance includes the entrustment deposit received from the members of eHuzhu, an online mutual aid platform operated by the Group, which is to be used during the one-year operating cycle and is therefore classified as a current asset. The balance for entrustment deposit was RMB44,110 and RMB38,252 as of December 31, 2022 and 2023, respectively. Further, restricted cash balance includes guarantee deposit required by the National Financial Regulatory Administration which replaces the China Banking and Insurance Regulatory Commission as the regulatory body since May 2023 in order to protect insurance premium appropriation by insurance agency which is restricted as to withdrawal for other than current operations. Thus, the Group classified the balance for guarantee deposit as a non-current asset. The balance for guarantee was RMB20,729 and RMB27,228 as of December 31, 2022 and 2023, respectively. (d) Short Term Investments All investments with original maturities less than twelve months or investments that are expected to be realized in cash during the next twelve months are classified as short-term investments. The Group accounts for short-term debt investments in accordance with ASC Topic 320, Investments – Debt Securities Securities that the Group has the positive intent and ability to hold to maturity are classified as held-to-maturity securities and stated at amortized cost less allowance for credit losses. The Group has no debt investments classified as trading. The Group’s short term investments are mainly available-for-sale debt securities that do not have a quoted market price in an active market. Available-for-sale investments are carried at fair values and the unrealized gains or losses from the changes in fair values are included in accumulated other comprehensive income or loss. The Group benchmarks the values of its other investments against fair values of comparable investments and reference to product valuation reports as of the balance sheet date and categorizes all fair value measures of short term investments as level 2 of the fair value hierarchy. The Group evaluates each individual available-for-sale debt securities periodically for impairment. For investments where the Group does not intend to sell, the Group evaluates whether a decline in fair value is due to deterioration in credit risk. Credit-related impairment losses, not to exceed the amount that fair value is less than the amortized cost basis, are recognized through an allowance for credit losses on the consolidated balance sheet with corresponding adjustment in the consolidated statements of income and comprehensive income. Subsequent increases in fair value due to credit improvement are recognized through reversal of the credit loss and corresponding reduction in the allowance for credit loss. Any decline in fair value that is non-credit related is recorded in accumulated other comprehensive income as a component of shareholder’s equity. As of December 31, 2023, there were no investments held by the Group that had been in continuous unrealized loss position. No impairment loss on short term investments was identified for years ended December 31, 2021, 2022 and 2023, respectively. (e) Accounts Receivable and Contract Assets Accounts receivable are recorded at the amount that the Group expects to collect and do not bear interest. Accounts receivables represent fees receivable on agency and claims adjusting services primarily from insurance companies. Contract assets are recorded when a long-term life insurance policy becomes effective, of which, the portion in relation to initial commissions earned is reclassified to accounts receivable upon the hesitation period expires; and the remaining portion arising from estimated renewal commissions will be reclassified to accounts receivable once the initial policy has been renewed and/or the Group has achieved certain renewal target in subsequent years within the renewal term of the policy. Accounts receivable are generally settled within 90 days since the initial recognition pursuant to the payment terms in the contract with customers, of which a minor portion relating to bonus earned based on annual performance condition is settled within one year. The Group evaluates the collectability of its accounts receivable and contract assets based on a combination of factors. The Group generally does not require collateral on trade receivables and contract assets as the majority of the Group’s customers are large, well-established insurance companies. The provision of credit losses for accounts receivable and contract assets is based upon the current expected credit losses (“CECL”) model by pooling accounts receivable and contract assets into various age buckets. The entire contract assets balance is included in the bucket of within 1 year. The expected credit loss rates applied range from 0.01% to 100%. In assessing the CECL, the Group considers both quantitative and qualitative information that is reasonable and supportable, including relevant available information from internal and external sources, related to past events, historical credit loss experience, current and future economic events as well as other conditions that may be beyond the Group’s control. Credit loss expenses are assessed quarterly and included in general and administrative expense on the consolidated statements of income and comprehensive income. Accounts receivable that are deemed uncollectible when all collection efforts have been exhausted are written off against the allowance for credit loss. Accounts receivable and contract assets, net is analyzed as follows: As of December 31, 2022 2023 RMB RMB Accounts receivable 408,961 295,562 Contract assets (See Note 2(q)) 659,788 1,071,064 Allowance for doubtful accounts (15,361 ) (15,784 ) Accounts receivable and contract assets, net 1,053,388 1,350,842 The following table summarizes the movement of the Group’s allowance for expected credit losses of accounts receivable and contract assets: 2021 2022 2023 RMB RMB RMB Balance at the beginning of the year 29,000 28,025 15,361 Current period provision for (reversal of) expected credit losses 2,095 (1,378 ) 4,036 Write-offs (3,070 ) (11,286 ) (3,613 ) Balance at the end of the year 28,025 15,361 15,784 (f) Property, Plant and Equipment Property, plant and equipment are stated at cost. Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives, taking into account residual value: Estimated Estimated Building 20-36 0% Office equipment, furniture and fixtures 3-5 0%-3% Motor vehicles 5-10 0%-3% Leasehold improvements 5 0% The depreciation methods and estimated useful lives are reviewed regularly. The following table summarizes the depreciation expense recognized in the consolidated statements of income and comprehensive income: 2021 2022 2023 RMB RMB RMB Operating costs 791 822 576 Selling expenses 5,778 5,106 4,368 General and administrative expenses 11,773 13,545 11,248 Depreciation expense 18,342 19,473 16,192 (g) Business combinations and non-controlling interests The Group evaluates acquisitions of assets to assess whether or not the transaction should be accounted for as a business combination or asset acquisition. In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs. The Group applies a ‘screen test’ that permits a simplified assessment of whether an acquired set of activities and assets is not a business. The test is met if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. Transactions in which the acquired is considered a business are accounted for as a business combination as described below. Conversely, transactions not considered as business acquisition are accounted for as acquisition of assets and liabilities. In such transactions, the cost of acquisition is allocated proportionately to the acquired identifiable assets and liabilities, based on their proportionate fair value on the acquisition date. In an asset acquisition, no goodwill is recognized. The Group accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805 “Business Combinations”. The consideration transferred in a business combination is measured as the aggregate of the acquisition-date fair value of the assets transferred, liabilities incurred by the Group to the selling shareholders of the acquiree, and the equity interests issued by the Group. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets acquired and liabilities assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the consideration transferred, the fair value of any non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree, is recorded as goodwill. The consideration for the Group’s business acquisitions may include future payments that are contingent upon the occurrence of a particular event or events. Contingent consideration also takes the form of a right of the Group to the returns of previously transferred assets or issued equity interests from the sellers of the acquired business. Both the rights and obligations for such contingent consideration returns and payments are recorded at fair value on the acquisition date. The Group’s contingent right to receive a return of some equity interests issued (i.e., contingently returnable shares) is recognized as an asset and measured at fair value. The Group’s obligation to pay contingent consideration is recognized and classified as a liability and measured at fair value. The contingent consideration rights and obligations are subsequently evaluated each reporting period with changes in fair value recognized as a gain or loss and recorded within change in the fair value of contingent assets and liabilities in the consolidated statements of income and comprehensive income. For the Group’s majority-owned subsidiaries and subsidiaries of VIEs, a non-controlling interest is recognized to reflect the portion of their equity which is not attributable, directly or indirectly, to the Group. Consolidated net income on the consolidated statements of income and comprehensive income includes the net income attributable to non-controlling interests. The cumulative results of operations attributable to non-controlling interests, are recorded as non-controlling interests on the Group’s consolidated balance sheets. (h) Goodwill and Other Intangible Assets Goodwill Goodwill represents the excess of costs over fair value of net assets of businesses acquired in a business combination. Goodwill is not amortized, but is tested for impairment at the reporting unit level at least on an annual basis at the balance sheet date or more frequently if certain indicators arise. The Group operated in two reporting units for the years ended December 31, 2022 and 2023. The impairment test is performed as of year-end or if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount by comparing the fair value of a reporting unit with its carrying value. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired and no further testing is required. If the fair value of the reporting unit is less than the carrying value, an impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The impairment review is highly judgmental and involves the use of significant estimates and assumptions. These estimates and assumptions have a significant impact on the amount of any impairment charge recorded. Estimates of fair value are primarily determined by using discounted cash flows. Discounted cash flows method is dependent upon assumptions of future sales trends, market conditions and cash flows of each reporting unit over several years. Actual cash flows in the future may differ significantly from those previously forecasted. Other significant assumptions include growth rates and the discount rate applicable to future cash flows. Based on this quantitative test in 2022 and 2023, it was determined that the fair value of each reporting unit tested exceeded its carrying amount and, therefore, the management concluded that goodwill was not impaired as of December 31, 2022 and 2023, respectively. Intangible Assets Identifiable intangibles assets are required to be determined separately from goodwill based on their fair values. In particular, an intangible asset acquired in a business combination should be recognized as an asset separate from goodwill if it satisfies either the “contractual-legal” or “separability” criterion. Intangible assets with a finite economic life are carried at cost less accumulated amortization. The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives on a straight-line basis. The estimated useful lives for the Group’s intangible assets are as follows: Estimated useful life (Years) Software 3 Non-compete agreements 5.8 - 6 Agent resources 2.8 - 3 Brokerage license 20 (i) Investment in Affiliates The Group uses the equity method of accounting for investments in which the Group has the ability to exercise significant influence, but does not have a controlling interest. The Group continually reviews its investment in equity investees to determine whether a decline in fair value to an amount below the carrying value is other-than-temporary. The primary factors the Group considers in its determination are the duration and severity of the decline in fair value; the financial condition, operating performance and the prospects of the equity investee; and other company specific information such as the stock price of the investee and its corresponding volatility, if publicly traded, the Group’s intent and ability to hold the investment until recovery, and changes in the macro-economic, competitive and operational environment of the investee. If the decline in fair value is deemed to be other-than-temporary, the carrying value of the equity investee is written down to fair value. (j) Long-term Investments Other non-current assets mainly represent long-term equity investments accounted for under the measurement alternative method, contingent consideration measured at fair value through profit or loss (see Note 2 (g) and Note 3 for details) and an investment in debt securities classified as held-to-maturity which is measured at amortized cost. Equity securities without readily determinable fair value The Group has long-term investments in equity security of certain privately held companies which the Group exerts no significant influence or a controlling interest. As a result of adoption of “ Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities During each reporting period, the Group makes a qualitative assessment considering impairment indicators to separately evaluate whether each of its equity securities without readily determinable fair value is impaired. Impairment indicators that the Group considers include, but are not limited to a significant deterioration in the earnings performance, credit rating, asset quality, or business prospects of the investee, factors such as negative cash flows from operations and working capital deficiencies that raise significant concerns about the investee’s ability to continue as a going concern, current economic and market conditions and other specific information. If a qualitative assessment indicates that the investment is impaired, the entity has to estimate the investment’s fair value in accordance with the principles of ASC 820. If the fair value is less than the investment’s carrying value, the Group recognizes an impairment loss in earnings equal to the difference between the carrying value and fair value. The Group recorded an impairment of nil nil Investment in debt securities with embedded features In 2023, the Group invested in a two-year-term debt security valued at RMB125,000 with a fixed return rate of 6% and an additional earning right contingently upon certain conditions met within the contract term. The Group evaluated the additional earning right as a derivative instrument that is “embedded” to the host contract in accordance with ASC 815. The Group considered the stated and implied substantive features of the contract as well as the economic characteristics and risks of the hybrid instrument and determined that the additional earning right be considered as an embedded derivative separated from the host contract and accounted it for as a derivative instrument. The Group classified the embedded derivative measured at fair value and change in fair value is charged through profit or loss. (k) Impairment of Long-Lived Assets Property, plant, and equipment and intangible assets with definite lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying value of the asset exceeds the fair value of the asset. (l) Insurance Premium Payables Insurance premium payables are insurance premiums collected on behalf of insurance companies but not yet remitted as of the balance sheet dates. (m) Treasury Shares Treasury shares represent ordinary shares repurchased by the Group that are no longer outstanding and are held by the Group. The repurchased ordinary shares are recorded whereby the total par value of shares acquired is recorded as treasury stock and the difference between the par value and the amount of cash paid is recorded in additional paid-in capital. If additional paid-in capital is not available or is not sufficient, the remaining amount is to reduce retained earnings. Ordinary shares issued in business combinations through an exchange of equity interests that are subsequently returned to the Company are also accounted for treasury shares (see Note 3(a) and 3(c) for details). (n) Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recognized for temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements, net operating loss carryforwards and credits by applying enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Group records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Group recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Group recognizes interest and penalties related to unrecognized tax benefits, if any, on the income tax expense line in the accompanying consolidated statement of income and comprehensive income. Accrued interest or penalties are included on the other tax liabilities line in the consolidated balance sheets. (o) Share-based Compensation All forms of share-based payments to employees and nonemployees, including restricted share units, stock options and stock purchase plans, are treated the same as any other form of compensation by recognizing the related cost in the consolidated statements of income and comprehensive income. The Group recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the amount of compensation cost recognized at any date must at least equal to the portion of the grant-date value of the award that is vested at that date. For awards with both service and performance conditions, if each tranche has an independent performance condition for a specified period of service, the Group recognizes the compensation cost of each tranche as a separate award on a straight-line basis; if each tranche has performance conditions that are dependent of activities that occur in the prior service periods, the Group recognizes the compensation cost on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards. The Group has made an accounting policy election to account for forfeitures when they occur for an award with only service conditions. For an award with a performance condition, the Group continues to assess at each reporting period whether it is probable that the performance condition will be achieved. No compensation cost is recognized for instruments that employees and nonemployees forfeit because a service condition or a performance condition is not satisfied. Employee share-based compensation Compensation cost related to employee stock options or similar equity instruments is measured at the grant date based on the fair value of the award and is recognized over the service period, which is usually the vesting period. If an award requires satisfaction of one or more performance or service conditions (or any combination thereof), compensation cost is recognized if the requisite service is rendered, while no compensation cost is recognized if the requisite service is not rendered. Nonemployee share-based compensation Consistent with the accounting requirement for employee share-based compensation, nonemployee share-based compensation within the scope of Topic 718 are measured at grant-date fair value of the equity instruments, which the Group is obligated to issue when the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied. (p) Employee Benefit Plans As stipulated by the regulations of the PRC, the Group’s subsidiaries in the PRC participate in various defined contribution plans organized by municipal and provincial governments for its employees. The Group is required to make contributions to these plans at a percentage of the salaries, bonuses and certain allowances of the employees. Under these plans, certain pension, medical and other welfare benefits are provided to employees. The Group has no other material obligation for the payment of employee benefits associated with these plans other than the annual contributions described above. The contributions are charged to the consolidated statements of income and comprehensive income as they become payable in accordance with the rules of the above mentioned defined contribution plans. (q) Revenue Recognition The Group’s revenue from contracts with insurance companies is derived principally from the provision of agency and claims adjusting services, and insurance companies are defined as the Group’s customers under ASC 606 “Revenue from Contracts with Customers” (“ASC 606”). The Group disaggregates its revenue from different types of service contracts with customers by principal service categories, as the Group believes it best depicts the nature, amount, timing and uncertainty of its revenue and cash flows. See Note 24 for detailed disaggregated revenue information that is disclosed for each reportable segment. The following is a description of the accounting policy for the principal revenue streams of the Group. Insurance agency services revenue The Group derives agency revenue serving as a sales agent to distribute various life insurance and property and casualty (“P&C”) insurance products on behalf of insurance companies by which the Group is entitled to receive an initial commission from the insurance companies based on the premium paid by the policyholders for the related insurance policy sold. For life insurance agency, the Group is also entitled to renewal commissions when the policyholder renews the policy within the renewal term of the original policy as such life insurance products are typically long-term products. The Group has identified its promise to sell insurance products on behalf of an insurance company as the performance obligation in its contracts with the insurance companies. The Group’s performance obligation to the insurance company is satisfied and revenue is recognized at a point in time when an insurance policy becomes effective. Specifically for life insurance agency business, certain contracts include the promise to provide certain post-sales administrative services to policyholders on behalf of the insurance company, such as responding to the policyholder inquiries, facilitating the renewal process and/or gathering information from the policyholder to assist the insurance companies to update the contact information of the policy holder, the Group has concluded such services are administrative in nature and immaterial, and none of these activities on their own results in a transfer of a good or services to the insurance company in the context of the contract. Accordingly, no performance obligation exists after a policy becomes effective. Initial placement of an insurance policy The Group recognizes agency revenue related P&C insurance products (which is short term in nature and related premiums are collected upfront) when an insurance policy becomes effective. The commission to be earned is required to be partially refunded contingently on policy cancellations. Based on its past experience, subsequent commission adjustments in connection with P&C insurance policy cancellations have been de minims to date, and are recognized upon notification from the insurance carriers. Actual commission and fee adjustments in connection with the cancellation of P&C insurance policies were 0.1%, 0.1% and 0.1% of the total commission and fee revenues during years ended December 31, 2021, 2022 and 2023, respectively. For life insurance products, there is generally a 10 to 15 days hesitation period after an initial placement of a life insurance policy, during which the policyholder has a legal right to unconditionally cancel the effective policy regardless of the reasons. According to relevant terms of the insurance agency contracts with customers, the Group reconciles information of policies sold which also includes policies that have been cancelled by policyholders within the hesitation period, with the insurance companies on a monthly basis. Therefore, the Group estimates cancellation of policies that have become effective but are still within the hesitation period based on subsequent actual data at each reporting date. The cancellation of an effective life insurance policy by the policyholder after the hesitation period does not require the Group to refund initial commission to insurance companies, but rather impacts the Group’s estimate on future commission related to renewal(s) of the policy. In addition, for life insurance agency, the Group may receive a performance bonus from insurance companies as agreed and per contract provisions. Once the Group achieves a certain sales volume based on respective agency agreements, the bonus will become due. Performance bonus represents a form of variable consideration associated with certain sales volume, for which the Group earns commissions. The Group estimates the amount of consideration with a constraint applied that will be received in the coming year such that a significant reversal of revenue is not probable, and includes performance bonus as part of the transaction price. For |
Acquisitions and Disposals
Acquisitions and Disposals | 12 Months Ended |
Dec. 31, 2023 | |
Acquisitions and Disposals [Abstract] | |
Acquisitions and disposals | (3) Acquisitions and disposals Acquisitions and disposal in 2023 The Group made certain acquisitions during the year ended December 31, 2023 as follows: (a) Acquisition of Zhongrong Smart Finance Information Technology Co., Ltd. (“Zhongrong”) On January 3, 2023, the Group entered into share purchase agreement with the shareholders of Zhongrong Smart Finance Information Technology Co., Ltd. (“Zhongrong”), an insurance intermediary primarily engaging for delivering life insurance products in China, to acquire 57.73% of the equity interests of Zhongrong. The total purchase price consisted of stock consideration valued at RMB153,732 through issuing 61,853,580 of the Company’s ordinary shares and a contingent asset of RMB7,162. Pursuant to the share purchase agreement, the selling shareholders shall return certain numbers of ordinary shares back to the Group and/or the Group may incur future payments if necessary conditions have not been satisfied respectively by the end of a lock-up period of three years. The acquisition of Zhongrong was accounted for using the acquisition method of accounting, and the purchase price allocation was made based on the fair value of the tangible and intangible assets acquired and liabilities assumed at the date of acquisition. The fair values of the assets acquired were determined using various valuation techniques, including cost approach and income approach. The fair value measurements were primarily based on significant inputs that are not directly observable in the market and are considered Level 3 under the fair value measurements and disclosure framework. Key assumptions include cash flow projections for Zhongrong and the discount rate applied to those cash flows as well as management’s assessment on probability of achieving required performance targets. The excess of the consideration transferred and the fair value of any non-controlling interests over the estimated fair values of the identifiable net assets acquired was recorded as goodwill. For goodwill reporting purposes, the operations and goodwill for Zhongrong are included in the agency segment as they are in similar businesses. Contingent consideration, included in other non-current asset in the consolidated balance sheets, is initially and subsequently measured with changes in fair value reflected in the consolidated statements of income and comprehensive Income. The Fair value of the non-controlling interest was estimated with reference to the purchase price per share as of the acquisition date. The following is a summary of the fair value of the purchase price and the final allocation of the purchase price to the assets acquired and liabilities assumed: RMB Consideration transferred Stock consideration 153,732 Contingent consideration (7,162 ) Total 146,570 Add: Non-controlling interest 107,318 253,888 RMB Assets acquired Cash and cash equivalents and restricted cash 17,174 Intangible assets acquired 61,472 - software 5,900 - Non-compete agreements 8,423 - Agent resources 28,749 - Insurance broker license 18,400 Accounts receivable and contract assets 163,396 Other assets 16,651 Total assets acquired 258,693 Liabilities Assumed Accounts payable and accrued commissions (173,194 ) Deferred tax liabilities (16,651 ) Other payables and accrued expenses (12,167 ) Other liabilities (9,477 ) Total liabilities assumed (211,489 ) Net assets acquired 47,204 Goodwill 206,684 Goodwill arising from the acquisition of this insurance intermediate was attributable to the benefit of expected synergies as of the date of acquisition and recorded in insurance agency segment. The resulted goodwill is not expected to be tax deductible for tax purposes. The result of operation of aforementioned acquisition has been consolidated by the Group from January 3, 2023, and the results of operations for the aforementioned acquisition is not material to the Group’s consolidated financial statements as a whole. Pro forma financial information is not presented for the acquisition of Zhongrong as it is immaterial to the reported results. (b) Acquisition of Jilin Zhongji Shi’An Insurance Agency Co., Ltd. (“Zhongji”) On February 6, 2023, the Group entered into share purchase agreement with the shareholders of Jilin Zhongji Shi’An Insurance Agency Co., Ltd. (“Zhongji”), an insurance intermediary primarily engaging for delivering life insurance products in China, to acquire 51% of the equity interests of Zhongji. The total purchase price as of the acquisition date, i.e., March 1, 2023 consisted of a stock consideration valued at RMB35,311 through issuing 13,660,720 of the Company’s ordinary shares and a contingent liability of RMB74. Pursuant to the share purchase agreement, the selling shareholders shall return certain numbers of ordinary shares back to the Group and/or the Group may incur a future payments if necessary conditions have not been satisfied by the end of a lock-up period of three years. The acquisition of Zhongji was accounted for using the acquisition method, and the purchase price allocation was based on the fair value of the tangible and intangible assets acquired and liabilities assumed at the date of acquisition. The fair values of the assets acquired were determined using various valuation techniques, including cost approach and income approach. The fair value measurements were primarily based on significant inputs that are not directly observable in the market and are considered Level 3 under the fair value measurements and disclosure framework. Key assumptions include cash flow projections for Zhongji and the discount rate applied to those cash flows as well as management’s assessment on probability of achieving required performance targets. The excess of the consideration transferred and the fair value of any non-controlling interests over the estimated fair values of the identifiable net assets acquired was recorded as goodwill. For goodwill reporting purposes, the operations and goodwill for Zhongji are included in the agency segment as they are in similar businesses. Contingent consideration included in other non-current asset in the consolidated balance sheets is initially and subsequently measured with changes in fair value reflected in the consolidated statements of income and comprehensive Income. The Fair value of the non-controlling interest was estimated with reference to the purchase price per share as of the acquisition date. The following is a summary of the fair value of the purchase price and the final allocation of the purchase price to the assets acquired and liabilities assumed: RMB Consideration transferred Stock consideration 35,311 Contingent consideration 74 Total 35,385 Add: Non-controlling interest 33,998 69,383 RMB Assets acquired Cash and cash equivalents and restricted cash 1,226 Intangible assets acquired 10,930 - Non-compete agreements 1,350 - Agent resources 7,180 - Insurance distribution license 2,400 Accounts receivable and contract assets, net 7,188 Other assets 2,602 Total assets acquired 21,946 Liabilities Assumed Accounts payable and accrued commissions (1,922 ) Deferred tax liabilities (2,732 ) Other payables and accrued expenses (3,777 ) Other liabilities (1,600 ) Total liabilities assumed (10,031 ) Net assets acquired 11,915 Goodwill 57,468 Goodwill arising from the acquisition of this agency intermediate was attributable to the benefit of expected synergies as of the date of acquisition and recorded in insurance agency segment. The resulted goodwill is not expected to be tax deductible for tax purposes. The result of operation of aforementioned acquisition has been consolidated by the Group from March 1, 2023, and the results of operations for the aforementioned acquisition is not material to the Group’s consolidated financial statements as a whole. Pro forma financial information is not presented for the acquisition of Zhongji as it is immaterial to the reported results. (c) Acquisition and disposal of Wuhan Taiping Online Insurance Agency Co., Ltd. (“Taiping”) On February 8, 2023, the Group entered into share purchase agreement with the shareholders of Wuhan Taiping Online Insurance Agency Co., Ltd. (“Taiping”), an insurance intermediary primarily engaging for delivering life insurance products in China, to acquire 51% of the equity interests of Taiping. The total purchase price as of the acquisition date, i.e., March 1, 2023 consisted of a stock consideration valued at RMB23,541 through issuing 9,107,140 of the Company’s ordinary shares and a contingent asset of RMB1,554. Pursuant to the share purchase agreement, the selling shareholders shall return certain numbers of ordinary shares back to the Group and/or the Group may incur a future payments if all necessary conditions have not been satisfied by the end of a lock-up period of three years. The acquisition of Taiping was accounted for using the acquisition method of accounting, and the purchase price allocation was based on the fair value of the tangible and intangible assets acquired and liabilities assumed at the date of acquisition. The fair values of the assets acquired were determined using various valuation techniques, including cost approach and income approach. The fair value measurements were primarily based on significant inputs that are not directly observable in the market and are considered Level 3 under the fair value measurements and disclosure framework. Key assumptions include cash flow projections for Taiping and the discount rate applied to those cash flows as well as management’s assessment on probability of achieving required performance targets. The excess of the consideration transferred and the fair value of any non-controlling interests over the estimated fair values of the identifiable net assets acquired was recorded as goodwill. For goodwill reporting purposes, the operations and goodwill for Taiping are included in the agency segment as they are similar businesses. The Fair value of the non-controlling interest was estimated with reference to the purchase price per share as of the acquisition date. The fair value of the purchase price was RMB21,987 as of the acquisition date which has been allocated based on the fair value of the assets acquired and liabilities assumed. RMB33,361 and RMB10,420 were allocated to goodwill and identified intangible assets, respectively. Contingent consideration is included in other non-current asset in the consolidated balance sheets is initially and subsequently measured with changes in fair value reflected in the consolidated statements of income and comprehensive Income. The result of operation has been consolidated by the Group from March 1, 2023 which is not material to the Group’s consolidated financial statements as a whole. Pro forma financial information is not presented for the acquisition of Taiping as it is immaterial to the reported results. Given that Taiping failed to meet certain performance targets in due course, 9,107,140 ordinary shares previously issued were repurchased by the Company whom in turn surrendered its equity interests of Taiping, pursuant to a supplementary agreement entered on November 30, 2023. A disposal gain of RMB139 was recorded in others, net for the year ended December 31, 2023. The business of Taiping was not integrated into insurance agency segment as it was disposed of shortly after it has been acquired and thus the benefits of the acquired goodwill were never realized by the rest of the reporting unit. The current carrying amount of the goodwill arising from the acquisition of Taiping that has been assigned to the agency segment was included in the carrying amount of Taiping to be disposed of. (d) Other Acquisitions In November of 2023, to implement Group’s overseas expansion strategy, the Group, through its subsidiary acquired 100% equity interest in Aasure Insurance Broker Limited, a Hong Kong insurance intermediate for cash consideration of RMB 2,650 The Group acquired 100% equity interest in Puyi Family Office (Chengdu) Enterprises Management Consulting Co., Ltd., or Puyi Family Office (Chengdu) from HPH for a nominal consideration on December 31, 2023. Puyi Family Office (Chengdu) primarily engages in family office business. Pro forma results of operations for all the individually immaterial business combinations have not been presented because they are not material collectively to the reported results for the year ended December 31, 2023. Acquisition of an agency intermediate company in 2022 In August of 2022, the Group acquired 100% equity interest in an agency intermediate for cash consideration of RMB31,390. The Group accounted for this acquisition as business combination. The consideration, fair value of assets acquired and liabilities assumed, as well as goodwill resulted from the acquisition are as follows: RMB Consideration: Cash 31,390 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash and cash equivalents 9,819 Short term investments 5,360 Accounts receivables 401 Other receivable and current assets 33,192 Property and equipment 11 Right of use assets 521 Total assets acquired 49,304 Accounts payables (4,532 ) Accrued expenses and other current liabilities (13,045 ) Lease liability (465 ) Total liabilities assumed (18,042 ) Net assets acquired 31,262 Goodwill 128 Goodwill arising from the acquisition of this agency intermediate was attributable to the benefit of expected synergies as of the date of acquisition and recorded in insurance agency segment. The resulted goodwill is not expected to be tax deductible for tax purposes. The result of operation of aforementioned acquisition has been consolidated by the Group from August 2022, and the results of operations for the aforementioned acquisition is not material to the Group’s consolidated financial statements as a whole. Pro forma financial information is not presented for the aforementioned business acquisition in the fiscal year 2022 as it is immaterial to the reported results. Disposal of subsidiaries in 2021 In 2021, the Group disposed of two subsidiaries for a total consideration of RMB3,600 and recognized a gain of RMB2,051 in aggregate. As of December 31, 2021, RMB600 of the consideration remained outstanding as a payable which was subsequently settled in 2022. |
Other Receivables, Net
Other Receivables, Net | 12 Months Ended |
Dec. 31, 2023 | |
Other Receivables, Net [Abstract] | |
Other Receivables, net | (4) Other Receivables, net Other receivables, net consist of the following: As of December 31, 2022 2023 RMB RMB Advances to staff (i) 11,397 12,748 Advances to entrepreneurial agents (i) 81 — Advances to a third party channel vendor (ii) 22,818 27,386 Rental deposits 19,535 11,820 Amount due from third parties (iii) 183,353 83,156 Other 4,841 7,058 Less: Allowance for current expected credit losses (10,976 ) (30,414 ) Other receivables, net 231,049 111,754 (i) Amounts represented advances to staffs or entrepreneurial agents of the Group for daily business operations, which are unsecured, interest-free and repayable on demand. (ii) Amount represented receivables from Shenzhen Chetong Technology Co., Ltd. (“Chetong”) who provides platform services to the Group. The receivables were unsecured, interest-free and repayable on demand. With the cease of cooperation with Chetong in 2022, the Group requested repayment of the advances. The Group estimated the net amount expected to be collected was RMB14,736 and nil (iii) Amount mainly represented 1) term-loan (matures in June 2024 with extension) to Sichuan Tianyi Real Estate Development Co., Ltd. (“Sichuan Tianyi”) of RMB40,000 and corresponding interest receivable RMB607 as of December 31, 2023. The loan is guaranteed by the ultimate controlling owner of Sichuan Tianyi, whom is jointly liable, with interest rate 6% per annum. This loan receivable is expected to be settled within one year. 2) term-loan (matures in June 2024) to a third party company principally engaged in provision of education service of RMB20,000 as of December 31, 2023, with the interest rate 5% per annum. 3) term-loan (matures in December 2024) to a third party manufacturing company of RMB21,000 as of December 31, 2023, with the interest rate 5% per annum. |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | (5) Property, Plant and Equipment, net Property, plant and equipment, net, is comprised of the following: As of December 31, 2022 2023 RMB RMB Building 12,317 15,572 Office equipment, furniture and fixtures 162,573 165,802 Motor vehicles 18,641 19,206 Leasehold improvements 39,993 34,969 Total 233,524 235,549 Less: Accumulated depreciation (191,945 ) (197,530 ) Construction in progress 56,880 53,640 98,459 91,659 No impairment for property, plant and equipment was recorded for the years ended December 31, 2021, 2022 and 2023. |
Other Current Assets, Net
Other Current Assets, Net | 12 Months Ended |
Dec. 31, 2023 | |
Other Current Assets, Net [Abstract] | |
Other current assets, net | (6) Other current assets, net Other current assets consist of the following: As of December 31, 2022 2023 RMB RMB Prepayment for acquisition of short-term investments 390,000 — Prepaid operating costs 12,594 7,828 Prepaid miscellaneous daily expenses 16,146 12,974 Equity investments with readily determinable fair value 126 96,343 Other 2,664 4,186 Less: Allowance for current expected credit losses (1,795 ) — 419,735 121,331 |
Goodwill, Net
Goodwill, Net | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill, Net [Abstract] | |
Goodwill, net | (7) Goodwill, net The gross amount of goodwill and accumulated impairment losses by reporting unit as of December 31, 2022 and 2023 are as follows: Agency Claims Total RMB RMB RMB Gross as of December 31, 2022 132,105 21,137 153,242 Addition in 2023 (Note 3) 297,413 — 297,413 Disposal in 2023 (Note 3) (33,261 ) — (33,261 ) Accumulated impairment loss as of December 31, 2022 and 2023 (22,108 ) (21,137 ) (43,245 ) Net as of December 31, 2022 109,997 — 109,997 Net as of December 31, 2023 374,149 — 374,149 The Group performed annual impairment analysis as of the balance sheet date. No impairment loss was recognized in goodwill for the years ended December 31, 2021, 2022 and 2023. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2023 | |
Intangible Assets, Net [Abstract] | |
Intangible assets, net | (8) Intangible assets, net Intangible assets, net, are comprised of the following: As of December 31, 2022 2023 RMB RMB Software — 5,900 Non-compete agreements — 9,773 Agent resources — 35,929 Brokerage license — 23,018 Total — 74,620 Less: Accumulated amortization — (16,304 ) — 58,316 During the years ended December 31, 2022 and 2023, the Company acquired intangible assets amounting to nil Amortization expenses for intangible assets recognized for the years ended December 31, 2021, 2022 and 2023 were RMB44, nil There were no impairment charges for intangible assets recorded for the years ended December 31, 2021, 2022 and 2023. |
Investments in Affiliates
Investments in Affiliates | 12 Months Ended |
Dec. 31, 2023 | |
Investments in Affiliates [Abstract] | |
Investments in Affiliates | (9) Investments in Affiliates As of December 31, 2022 and 2023, the Group’s investments accounted for under the equity method were as follows: As of December 31, 2022 2023 RMB RMB CNFinance — — Others 4,035 — Total 4,035 — Investment in CNFinance Holdings Limited (“CNFinance”) The Group held 18.5% equity interest of CNFinance which was accounted for using the equity method. The Group recognized an other-than-temporary impairment of RMB29,316 and RMB78,277 for years ended December 31, 2021 and 2022, respectively, to reduce the carrying value of the investment to reflect the market value of the shares held by the Group. On June 28, 2022, the Group completed the distribution of 252,995,600 ordinary shares of CNFinance to its shareholders on a pro rata basis, after which the Group’s equity stake in CNFinance decreased from approximately 18.5% to approximately 0.01%. Upon the completion of the distribution, the Company ceased to account for the remaining equity investment in CNFinance using equity method as the Company no longer has significant influence over this investee. Investment in Highest Performances Holdings Inc. (“HPH”) The Group held 4.46% equity interests in HPH before HPH’s listing in Nasdaq (symbol: HPH, formerly known as “PUYI”) in 2018. HPH is a leading third-party wealth management services provider in China. Investment in HPH is accounted for using the equity method as the Group has significant influence by the right to nominate one board member out of seven. In December 2023, the Group entered into a share repurchase agreement with HPH, pursuant to which the Group agreed to transfer all of its 4.46% equity interests in HPH back to HPH. Concurrently, a wholly-owned subsidiary of the Group entered into a share transfer agreement with HPH to acquire 15.41% equity interests in Fanhua Puyi Fund Sales Co., Ltd. (“Puyi Fund”), a wholly-owned subsidiary of HPH, at the aggregate consideration of the aforementioned 4.46% equity interests in HPH and cash of RMB10,463. Upon the completion of the disposals of CNFinance and HPH, the carrying amount of remaining investee is at nil |
Other Non-Current Assets
Other Non-Current Assets | 12 Months Ended |
Dec. 31, 2023 | |
Other Non-Current Assets [Abstract] | |
Other non-current assets | (10) Other non-current assets Other non-current assets consist of the following: As of December 31, 2022 2023 RMB RMB Equity investments without readily determinable fair value (Note 2(j)) 11,400 31,892 Long-term hybrid instrument (Note 2(j)) — 125,000 Amount due from a third party (i) — 30,359 Contingent considerations (Note 3) — 13,461 Receivables from certain shareholders as guarantee deposit due to business combinations — 33,373 Others — 4,597 Less: Allowance for current expected credit losses — (2,930 ) 11,400 235,752 (i) Amount represented a term-loan (matures in September 2028) to a third party of RMB30,000 and corresponding interest receivable RMB359 as of December 31, 2023. The loan bears interest rate 4.5% per annum and is guaranteed by the ultimate controlling owner of the borrower, whom is jointly liable. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Leases | (11) Leases The Group’s lease for office space include only fixed rental payments with no variable lease payment terms. As of December 31, 2022 and 2023, there were no leases that have not yet commenced. The following represents the aggregate ROU assets and related lease liabilities as of December 31, 2022 and 2023: As of December 31, 2022 2023 RMB RMB Operating lease ROU assets 145,086 136,056 Current operating lease liability 62,304 57,164 Non-current operating lease liability 74,190 71,311 Total operating leased liabilities 136,494 128,475 The weighted average lease term and discount rate as of December 31, 2022 and 2023 were as follows: As of December 31, 2022 2023 Weighted average lease term: Operating leases 2.83 2.83 Weighted average discount rate: Operating leases 4.28 % 3.89 % The components of lease expenses for the years ended December 31, 2022 and 2023 were as follows: As of December 31, 2022 2023 RMB RMB Operating lease expense 97,576 74,819 Short term lease expense 1,227 7,748 Total 98,803 82,567 Supplemental cash flow information related to leases for the years ended December 31, 2022 and 2023 were as follows: As of December 31, 2022 2023 RMB RMB Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases 90,438 72,223 Supplemental noncash information: Right-of-use assets obtained in exchange for lease obligations net of decrease in right-of-use assets for early determinations 4,462 57,233 Maturities of lease liabilities at December 31, 2023: Minimum RMB Year ending December 31: 2024 58,924 2025 43,048 2026 23,747 2027 5,941 2028 2,423 Thereafter 1,351 Total remaining undiscounted lease payments 135,434 Less: Interest 6,959 Total present value of lease liabilities 128,475 Less: Current operating lease liability 57,164 Non-current operating lease liability 71,311 |
Variable Interest Entities (_VI
Variable Interest Entities (“VIEs”) | 12 Months Ended |
Dec. 31, 2023 | |
Variable Interest Entities (“VIEs”) [Abstract] | |
Variable Interest Entities (“VIEs”) | (12) Variable Interest Entities (“VIEs”) VIE related to Xinbao Investment and Fanhua RONS Technologies The Measures on the Supervision of Internet Insurance Business implemented in February 2021 requires an insurance institution conducts online insurance business through its own online platform who owns the domain name. Fanhua RONS Insurance Sales & Services Co., Ltd., (“Fanhua RONS”), a wholly-owned subsidiary of Shenzhen Xinbao Investment Co., Ltd. (“Xinbao Investment”), used to conduct its online P&C insurance business through an online platform (www.baoxian.com) owned and operated by another subsidiary within the Group. To comply with the newly implemented rules, the Group transferred the domain name and ICP license to Fanhua RONS. As the applicant for an ICP license may be subject to foreign investment restriction, the Group commenced a restructuring to re-establish the VIE structure. Xinbao Investment was a wholly owned subsidiary of the Group who in December 2021 became 49% owned by the Group where the remaining 51% equity interests were transferred to Mr. Shuangping Jiang at nominal value who holds the interest on behalf of the Group, because Xinbao Investment is, under the new rule, prohibited to own more than 50% of the equity interests in a value-added telecommunications service provider, i.e., Fanhau RONS. Through the contractual arrangements entered in December 2021, with Xinbao Investment and its nominee shareholder, the Group has the power to direct the activities that most significantly impact to and entitles to receive economic benefits from Xinbao Investment, the consolidated VIE. In preparation for the application of an ICP license for Fanhua RONs (Beijing) Technology Co., Ltd. (“Fanhua RONS Technologies”), in July 2022, Beijing Fanlian Investment Co., Ltd. (“Fanlian Investment”), a wholly owned subsidiary, transferred its entire equity interests holding in Fanhua RONS Technologies to Mr. Peng Ge, the chief financial officer of the Group, who holds the equity interests on behalf of Fanlian Investment. Concurrently, Fanlian Investment entered into contractual arrangements with Fanhua RONS Technologies and Mr. Ge which are substantially similar to those among Fanhua Group Company, Xinbao Investment and its individual nominee shareholder. As a result, the Group currently conducts its insurance agency and claims adjusting business in China primarily through its wholly-owned subsidiaries Fanhua Group Company and Fanlian Investment (collectively the “relevant PRC entities”), and its subsidiaries and the VIEs for part of its online insurance business in China. The following is a summary of the contractual agreements that the Group entered into with Xinbao Investment, Fanhua RONS Technologies and their individual nominee shareholders: Agreements that Provide the Group Effective Control over Xinbao Investment and Fanhua RONS Technologies ● Loan Agreement Mr. Jiang and Mr. Ge (collectively the “nominee shareholders”) entered into a loan agreement, with the Group’s wholly-owned subsidiaries. The principal loan amounts equal to the capital contributions to VIEs. The term of the loan agreement is for ten years, which may be extended only upon written agreement of the parties. If the loan is not extended, then upon its expiration and subject to then applicable PRC laws, the loan can be repaid only with the proceeds from a transfer of the individual shareholder’s equity interests in VIEs to relevant PRC entities or another person or entity designated by them. Relevant PRC entities may accelerate the loan repayment upon certain events, including but not limited to if the individual shareholder resigns or is dismissed from employment by us or if relevant PRC entities exercise its option to purchase the shareholder’s equity interests in VIEs pursuant to the exclusive purchase option agreements described below. ● Equity Pledge Agreement Relevant nominee shareholders entered into an equity pledge agreement, pledging their respective equity interests in VIEs to relevant PRC entities to secure their obligations under the loan agreement. Relevant nominee shareholders also agreed not to transfer or create any encumbrances adverse to relevant PRC entities on their equity interests in VIEs. During the term of the equity pledge agreement, relevant PRC entities are entitled to all the dividends declared on the pledged equity interests. The equity pledge agreements will expire when the individual shareholders fully performs their respective obligations under the loan agreement. The equity pledge was recorded on the shareholder’ register of VIEs, and registered with the relevant local administration of industry and commerce. ● Power of Attorney Relevant nominee shareholders executed powers of attorney, each appointing a person designated by relevant PRC entities as his attorney-in-fact on all matters requiring shareholder approval. Further, if relevant PRC entities designate the shareholder to attend a shareholder’s meeting of VIEs, the individual shareholder agrees to vote his shares as instructed by relevant PRC entities. The term of the power of attorney is for ten years. Agreements that Transfer Economic Benefits to the Group ● Exclusive Purchase Option Agreement Relevant nominee shareholders entered into an exclusive purchase option agreement to irrevocably grant relevant PRC entities an exclusive option to purchase part or all of their equity interests in VIEs, when and to the extent permitted by PRC law. The purchase price will be the minimum price permitted under applicable PRC law. ● Technology Consulting and Service Agreement Pursuant to technology service agreements between (i) relevant PRC entities, and (ii) VIEs, relevant PRC entities agreed to provide VIEs with training services and consulting and other services relating to IT platform and internal control compliance. In exchange, VIEs agree to pay a quarterly fee calculated primarily based on a percentage of its revenues. The agreement has a term of one year and can be renewed each year upon mutual agreement. Because of contractual arrangements with VIEs and their nominee shareholders, the Group is the primary beneficiary of VIEs and their subsidiaries and consolidated them into consolidated financial statements. Risks in relation to the VIE Arrangement In the opinion of the Company’s legal counsel, (i) the ownership structure relating to the consolidated VIEs of the Company is in compliance with PRC laws and regulations; (ii) the contractual arrangements with the consolidated VIEs and the individual shareholders are legal, valid and binding obligation of such party, and enforceable against such party in accordance with their respective terms; and (iii) the execution, delivery and performance of the consolidated VIEs and its shareholders do not result in any violation of the provisions of the articles of association and business licenses of the VIEs, and any violation of any current PRC laws and regulations. Uncertainties in the PRC legal system could cause the Company’s current corporate structure to be found in violation of any existing and/or future PRC laws or regulations and could limit the Company’s ability, through the Primary Beneficiary, to enforce its rights under these contractual arrangements. Furthermore, the shareholders of the VIEs may have interests that are different from those of the Company, which could potentially increase the risk that the shareholders would seek to breach the existing terms of the aforementioned agreements. In addition, if the current structure or any of the contractual arrangements were found to be in violation of any existing or future PRC laws, the Company may be subject to penalties, which may include but not be limited to, the cancellation or revocation of the Company’s business and operating licenses, being required to restructure the Company’s operations or discontinue the Company’s operating activities. The imposition of any of these or other penalties may result in a material and adverse effect on the Company’s ability to conduct its operations. In such case, the Company may not be able to operate or control VIEs, which may result in deconsolidation of VIEs. Summarized below is the information related to VIEs, including total assets, total current liabilities, total liabilities, net revenues, total operating costs and expenses, net income (loss) and cash flows after intercompany elimination are as follows: As of December 31, 2022 2023 RMB RMB Total assets 102,965 139,541 Total current liabilities (50,457 ) (39,996 ) Total liabilities (77,990 ) (68,430 ) Year Ended December 31, 2021 2022 2023 RMB RMB RMB Net revenues 16,267 141,086 122,880 Operating costs and expenses 1,814 67,788 100,957 Net income (loss) 14,431 (4,136 ) (13,085 ) Net cash generated from operating activities 48,923 98,715 3,754 As of December 31, 2023 there were no consolidated VIE assets that are collateral for the VIE’s obligations or are restricted solely to settle the VIEs’ obligations, other than aforementioned in the restricted cash as described in Note 2(c). In the year ended December 31, 2023, aggregate revenues derived from these VIEs contributed 3.8% of the total consolidated net revenues, based on the corporate structure as of the end of 2023. As of December 31, 2023, the VIEs accounted for an aggregate of 3.2% of the consolidated total assets. The creditors of the VIEs’ third-party liabilities did not have recourse to the general credit of the Company in normal course of business. The Company has not provided any financial support that it was not previously contractually required to provide to the VIEs. |
Other Payables and Accrued Expe
Other Payables and Accrued Expenses | 12 Months Ended |
Dec. 31, 2023 | |
Other Payables and Accrued Expenses [Abstract] | |
Other Payables and Accrued Expenses | (13) Other Payables and Accrued Expenses Components of other payables and accrued expenses are as follows: As of December 31, 2022 2023 RMB RMB Business and other tax payables 77,502 89,715 Refundable deposits from employees and agents 19,789 18,239 Professional fees 3,586 5,609 Accrued expenses to third parties 29,861 33,382 Contributions from members of eHuzhu mutual aid program (Note 2(c)) 43,140 37,261 Others 448 1,793 Total 174,326 185,999 |
Short-term Loans
Short-term Loans | 12 Months Ended |
Dec. 31, 2023 | |
Short-term Loans [Abstract] | |
Short-term loans | (14) Short-term loans Short-term loans and total outstanding balance as of December 31, 2022 and 2023 amounted to RMB35,679 and RMB164,300, respectively, which are RMB-denominated borrowings made by the Company’s subsidiaries from financial institutions in mainland China. The Group borrowed RMB35,679 and RMB182,301 one-year loans for its general working capital purposes in 2022 and 2023, respectively. As of December 31, 2022 and 2023, the weighted average interest rates for the outstanding borrowings were approximately 4.50% and 4.50%, respectively, and the unused lines of credit for the short-term loans was RMB164,321 and RMB35,700, respectively. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2023 | |
Employee Benefit Plans [Abstract] | |
Employee Benefit Plans | (15) Employee Benefit Plans Employees of the Group located in the PRC are covered by the retirement schemes defined by local practice and regulations, which are essentially defined contribution plans. In addition, the Group is required by law to contribute a certain percentage of applicable salaries for medical insurance benefits, unemployment and other statutory benefits. The contribution percentages may be different from district to district which is subject to the specific requirement of local regime government. The PRC government is directly responsible for the payments of the benefits to these employees. For the years ended December 31, 2021, 2022 and 2023, the Group contributed and accrued RMB118,837, RMB131,385 and RMB131,228, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Taxes [Abstract] | |
Income Taxes | (16) Income Taxes The Company is a tax exempted company incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, the Company is not subject to tax on its income or capital gains. In addition, upon any payments of dividends by the Company to its shareholders, no Cayman Islands withholding tax is imposed. Subsidiaries in Hong Kong are subject to Hong Kong Profits Tax rate at 16.5%, and foreign-derived income is exempted from income tax. Under the two-tiered profits tax rates regime, the provision for current income taxes of the subsidiaries operating in Hong Kong has been calculated by applying the current rate of taxation of 8.25% for the years ended December 31, 2021, 2022 and 2023. The Group’s subsidiaries and VIEs incorporated in the PRC are subject to the PRC Enterprise Income Tax and a unified 25% enterprise income tax rate, except for certain entities that are entitled to preferential tax treatments. Preferential EIT rates at 15% is available for qualified enterprises located in the western China regions in an industry sector encouraged by the PRC government. Fanhua Lianxing Insurance Sales Co., Ltd., the Group’s wholly-owned subsidiary, which is the holding entity of the Group’s life insurance operations, was entitled to a preferential tax rate of 15% for the years ended December 31, 2021, 2022 and 2023, respectively. Pursuant to the relevant laws and regulations in the PRC, Shenzhen Huazhong United Technology Co., Ltd. (“Shenzhen Huazhong”), a subsidiary of the Group, was regarded as a software company and thus exempted from PRC Income Tax for two years starting from its first profit-making year, followed by a 50% reduction for the next three years. For Shenzhen Huazhong, year 2017 was the first profit-making year and accordingly it has made a 12.5% tax provision for its profits for the year ended December 31, 2021, Shenzhen Huazhong no longer enjoys such a preferential rate from 2022 to 2023. The Group’s subsidiaries that are the PRC tax resident are required to withhold the PRC withholding tax of 10% on dividend payment to their non-PRC resident immediate holding company, unless such dividend payment is qualified for the 5% reduced tax rate under the Arrangement between Mainland China and Hong Kong for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (the “PRC-HK DTA”). One of the Group’s wholly-owned subsidiaries, CNinsure Holdings Limited, was determined by Hong Kong Taxation Bureau to be a Hong Kong resident enterprise since July 2018. The Hong Kong resident certificate was issued by the Hong Kong Inland Revenue Department valid till the year ending December 31, 2023. Accordingly, CNinsure Holdings Limited qualified as a Hong Kong resident and was entitled to enjoy a reduced tax rate of 5% for the dividends paid by PRC subsidiaries for the years ended December 31, 2021, 2022 and 2023 under Bulletin [2018] No. 9 (e.g. beneficial ownership, shareholding percentage and holding period). The Group accounts for uncertain income tax positions by prescribing a minimum recognition threshold in the financial statements. The Group’s liabilities for unrecognized tax benefits were included in other tax liabilities. As of December 31, 2022 and 2023, the balance of unrecognized tax benefits is comprised of amounts mainly arising from gain on disposal of subsidiaries and certain transfer pricing arrangements. The movements of unrecognized tax benefits are as follows: RMB Balance as of January 1, 2021 67,219 Change in unrecognized tax benefits — Increase in tax positions 5,994 Balance as of December 31, 2021 73,213 Change in unrecognized tax benefits — Decrease in tax positions (36,566 ) Balance as of December 31, 2022 36,647 Change in unrecognized tax benefits — Decrease in tax positions (2,279 ) Balance as of December 31, 2023 34,368 The uncertain tax positions are related to tax years that remain subject to examination by the relevant tax authorities. Based on the outcome of any future examinations, or as a result of the expiration of statute of limitations for specific jurisdictions, it is reasonably possible that the related unrecognized tax benefits for tax positions taken regarding previously filed tax returns, might materially change from those recorded as liabilities for uncertain tax positions in the Group’s consolidated financial statements. In addition, the outcome of these examinations may impact the valuation of certain deferred tax assets (such as net operating losses) in future periods. The Group’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits, if any, as a component of income tax expense. The Group does not anticipate any significant increases or decreases to its liability for unrecognized tax benefits within the next twelve months. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of income taxes is due to computational errors made by the taxpayer. The statute of limitations will be extended to five years under special circumstances, which are not clearly defined, but an underpayment of income tax liability exceeding RMB100 is specifically listed as a special circumstance. In the case of a transfer pricing related adjustment, the statute of limitations is ten years. There is no statute of limitations in the case of tax evasion. During the current year, the Group reversed transfer pricing related uncertain tax position amounting to RMB3,963 when its statute of limitation expired in 2023. Income tax expenses are comprised of the following: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Current tax expense 66,665 13,169 44,836 Deferred tax expense 23,909 27,847 14,566 Income tax expense 90,574 41,016 59,402 The principal components of the deferred income tax assets and liabilities are as follows: As of December 31, 2022 2023 RMB RMB Deferred tax assets: Operating loss carryforward 96,173 117,072 Intangible assets, net 2,856 5,003 Less: valuation allowances (78,627 ) (81,340 ) Total 20,402 40,735 Deferred tax liabilities: Fair value adjustments in relation to short-term investments 13,954 15,944 Estimated profit arising from future renewal commissions 59,271 91,428 PRC dividend withholding taxes 29,230 29,230 Identifiable intangible assets — 12,549 Total 102,455 149,151 The Group considers positive and negative evidence to determine whether some portion or all of the deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carry forward periods, the Group’s experience with tax attributes expiring unused and tax planning alternatives. Valuation allowances have been established for deferred tax assets based on a more-likely-than-not threshold. The Group’s ability to realize deferred tax assets depends on its ability to generate sufficient taxable income within the carry forward periods provided for in the tax law. The Group has provided RMB78,627 and RMB81,340 valuation allowance for the years ended December 31, 2022 and 2023, respectively. The Group had total operating loss carry-forwards of RMB385,155 and RMB468,715 as of December 31, 2022 and 2023, respectively. As of December 31, 2023, all of the operating loss carry-forwards will expire in the years from 2024 to 2028. During the years ended December 31, 2021, 2022 and 2023, RMB8,314, RMB18,349 and RMB44,091, respectively, of tax loss carried forward has been expired and canceled. Reconciliation between the provision for income taxes computed by applying the PRC enterprise income rate of 25% to net income before income taxes and income of affiliates, and the actual provision for income taxes is as follows: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Income from continuing operations before income taxes, share of income of affiliates, net 371,088 196,335 349,818 PRC statutory tax rate 25 % 25 % 25 % Income tax at statutory tax rate 92,772 49,084 87,455 Expenses not deductible for tax purposes: —Entertainment 2,950 2,099 2,417 —Other 81 479 340 Effect of tax holidays on concessionary rates granted to PRC entities (13,523 ) (12,671 ) (9,956 ) Effect of different tax rates of subsidiaries operating in other jurisdictions 2,070 2,342 4,110 Change in valuation allowance 2,999 40,501 2,713 Deferred income tax for dividend distribution 10,349 — — Effect of non-taxable income* (13,777 ) (4,620 ) (25,709 ) Unrecognized tax benefits arising from certain transfer pricing arrangements 5,994 (36,566 ) (2,279 ) Other 659 368 311 Income tax expense 90,574 41,016 59,402 * The effect of non-taxable income for years ended December 31, 2021 and 2022 represents an income tax exemption according to the Notice (Cai Shui [2002] No. 128) promulgated by the State Administration of Taxation and Ministry of Finance in China on dividend income derived from a purchased open-end securities investment fund product that the Group recorded as short term investment. The effect of non-taxable income for the year ended December 31, 2023 is primarily relating to the non-taxable gains from changes in fair value of equity interests held by the Group. Additional PRC income taxes that would have been payable without the tax exemption amounted to approximately RMB13,523, RMB12,671 and RMB9,956 for the years ended December 31, 2021, 2022 and 2023, respectively. Without such exemption, the Group’s basic net profit per share for the years ended December 31, 2021, 2022 and 2023 would have been decreased by RMB0.01, RMB0.01 and RMB0.01, and diluted net profit per share for the years ended December 31, 2021, 2022 and 2023 would have been decreased by RMB0.01, RMB0.01 and RMB0.01, respectively. If the entities were to be non-resident for PRC tax purposes, dividends paid to it out of profits earned after January 1, 2008 would be subject to a withholding tax. In the case of dividends paid by PRC subsidiaries, the withholding tax would be 10%, whereas in the case of dividends paid by PRC subsidiaries which are 25% or more directly owned by tax residents in the Hong Kong Special Administrative Region, the withholding tax would be 5%. The Group’s subsidiary, CNinsure Holdings Limited qualified as Hong Kong resident and was entitled to enjoy a 5% reduced tax rate under Bulletin [2018] No. 9 for the years ended December 31, 2021. Aggregate undistributed earnings of the Group’s subsidiaries and VIEs in the PRC that are available for distribution to the Group of approximately RMB1,399,701 and RMB1,664,408 as of December 31, 2022 and 2023 respectively, are considered to be indefinitely reinvested. If those earnings were to be distributed or they were determined to be no longer permanently reinvested, the Group would have to record a deferred tax liability in respect of those undistributed earnings of approximately RMB69,985 and RMB83,220, respectively. During the years ended December 31, 2021,2022 and 2023, the Group provided RMB10,349, nil nil Under applicable accounting principles, a deferred tax liability should be recorded for taxable temporary differences attributable to the excess of financial reporting over tax basis, including those differences attributable to a more-than-50-percent-owned domestic subsidiary. However, recognition is not required in situations where the tax law provides a means by which the reported amount of that investment can be recovered tax-free and the enterprise expects that it will ultimately use that means. |
Capital Structure
Capital Structure | 12 Months Ended |
Dec. 31, 2023 | |
Capital Structure [Abstract] | |
Capital Structure | (17) Capital Structure Issuance of new shares As disclosed in Note (3)(a), the Company issued 61,853,580 ordinary shares to the shareholders of Zhongrong to acquire 57.73% equity interests of Zhongrong in March 2023. The consideration, adjustable based on the achievement of certain performance targets in the next three years by Zhongrong, is subject to a lock-up period of three years and will be released from lock-up in two batches after 2025. On August 31, 2023, one of the selling shareholders who previously sold 1.56% equity interests in Zhongrong in exchange for 0.3% equity interests of the Group, entered into a supplemental agreement with the Group to modify the payment terms from ordinary shares of the Company to RMB11,513 in cash. As a result, 3,591,780 ordinary shares previously issued to the selling shareholder were repurchased by the Company in December 2023 which resulted in recognizing a loss of RMB3,043 in others, net in the consolidated statements of income and comprehensive income for the year ended December 31, 2023. The repurchased shares were included in treasury stock as of December 31, 2023. As disclosed in Note (3)(b), the Company issued 13,660,720 ordinary shares to the shareholders of Zhongji to acquire 51% of the equity interests of Zhongji in March 2023. The consideration, adjustable based on the achievement of certain performance targets in the next three years by Zhongji, is subject to a lock-up period of three years and will be released from lock-up in two batches after 2025. As stated in Note (3)(b), the Company issued 9,107,140 ordinary shares to the existing shareholder of Taiping to acquire 51% of the equity interests of Taiping in March 2023. As Taiping failed to meet certain performance targets, 9,107,140 previously issued ordinary shares were repurchased by the Company and the Company surrendered the acquired 51% equity interests of Taiping, pursuant to a supplementary agreement entered on November 30, 2023. The repurchased shares were included in treasury stock as of December 31, 2023. The Group accounts for the repurchased ordinary shares under the par value method and includes such treasury stock as a component of the shareholders’ equity. Repurchase of ordinary shares During 2022, the Company repurchased an aggregate of 72,465 ADSs from the open market, representing 0.1% of the total shares outstanding as of December 31, 2022,at an average price of US$7.85 per ADS for a total amount of approximately RMB3,984, under its share buyback program (“2022 Share Buyback Program”) to repurchase up to US$20 million ADSs, as previously announced by its board of directors in December 2022. During 2023, the Company repurchased an aggregate of 526,441 ADSs from the open market and 634,946 ADSs from certain shareholders, representing 2% of the total shares outstanding as of December 31, 2023, at an average price of US$7.42 per ADS for a total amount of approximately RMB62,309, under the 2022 Share Buyback Program. The Group accounts for repurchased ordinary shares under the par value method and includes such treasury stock as a component of the shareholders’ equity. |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Net Income Per Share [Abstract] | |
Net Income per Share | (18) Net Income per Share As of December 31, 2021, 2022 and 2023, there were nil nil nil The computation of basic and diluted net income per ordinary share is as follows: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Basic: Net income 259,941 85,723 289,099 Less: Net income (loss) attributable to the noncontrolling interests 8,952 (14,549 ) 8,622 Net income attributable to the Company’s shareholders 250,989 100,272 280,477 Weighted average number of ordinary shares outstanding* 1,073,891,784 1,074,196,310 1,074,372,067 Basic net income per ordinary share 0.23 0.09 0.26 Basic net income per ADS 4.67 1.87 5.22 * The weighted average number of ordinary shares outstanding excludes the number of ordinary shares issued in business combinations occurred in 2023 through an exchange of equity interests that are treated in the same manner as contingently issuable shares because the holders must return all or part if all necessary conditions have not been satisfied by the end of the period. Year Ended December 31, 2021 2022 2023 RMB RMB RMB Diluted: Net income 259,941 85,723 289,099 Less: Net income (loss) attributable to the noncontrolling interests 8,952 (14,549 ) 8,622 Net income attributable to the Company’s shareholders 250,989 100,272 280,477 Weighted average number of ordinary shares outstanding 1,073,891,784 1,074,196,310 1,074,372,067 Weighted average number of dilutive potential ordinary shares from share options and restricted share units 399,410 261,511 2,368,131 Total 1,074,291,194 1,074,457,821 1,076,740,198 Diluted net income per ordinary share 0.23 0.09 0.26 Diluted net income per ADS 4.67 1.87 5.21 |
Distribution of Profits
Distribution of Profits | 12 Months Ended |
Dec. 31, 2023 | |
Distribution of Profits [Abstract] | |
Distribution of Profits | (19) Distribution of Profits As stipulated by the relevant PRC laws and regulations applicable to China’s foreign investment enterprise, the Group’s subsidiaries and VIEs in the PRC are required to maintain non-distributable reserves which include a statutory surplus reserve as of December 31, 2022 and 2023. Appropriations to the statutory surplus reserve are required to be made at not less than 10% of individual company’s net profit as reported in the PRC statutory financial statements of the Company’s subsidiaries and VIEs. The appropriations to statutory surplus reserve are required until the balance reaches 50% of the registered capital of respective subsidiaries and VIEs. The statutory surplus reserve is used to offset future losses. These reserves represent appropriations of retained earnings determined according to PRC law and may not be distributed. The accumulated amounts contributed to the statutory reserves were RMB559,520 and RMB608,376 as of December 31, 2022 and 2023, respectively. Under PRC laws and regulations, there are restrictions on the Company’s PRC subsidiaries and VIEs with respect to transferring certain of their net assets to the Company either in the form of dividends, loans, or advances. Amounts of restricted net assets include paid in capital and statutory surplus reserve of the Company’s PRC subsidiaries and the net assets of the VIEs in which the Company has no legal ownership, totaling RMB1,461,214 and RMB1,510,070 as of December 31, 2022 and 2023, respectively, which were not eligible to be distributed. |
Related-Party Balances and Tran
Related-Party Balances and Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related-Party Balances and Transactions [Abstract] | |
Related-party Balances and Transactions | (20) Related-party Balances and Transactions The principal related-party balances as of December 31, 2022 and 2023, and transactions for the years ended December 31, 2021, 2022 and 2023 are as follows: (i) On December 28, 2020, the Group entered into a framework strategic partnership agreement, or, the “Agreement”, with Puyi Enterprise Management Consulting Co., Ltd (“Puyi Consulting”), which was controlled by HPH (formerly known as “Puyi”). Pursuant to the Agreement, both parties, on the basis of full compliance with relevant regulatory and legal requirements will share customer and channel resources and explore collaboration opportunities on the provision of value-added asset management services to Chinese households, by leveraging both parties’ respective strength in insurance and financial services. For the year ended December 31, 2021, the Group incurred RMB5,386 commission cost to Puyi Consulting and the balance of accounts payable as of December 31, 2021 was RMB2,894. For the year ended December 31, 2022, the Group incurred RMB13,548 commission cost to Puyi Consulting and the balance of account payable as of December 31, 2022 was RMB4,987. For the year ended December 31, 2023, the Group incurred RMB1,590 commission cost to Puyi Consulting and the balance of account payable as of December 31, 2023 was nil nil (ii) On March 7, 2022, the Group entered into an agreement with Puyi Consulting. Pursuant to this agreement, Puyi Consulting provided training services and customer salon support services to the Group. For the year ended December 31, 2022, the Group incurred RMB7,017 services expense to Puyi Consulting and the balance of other payable as of December 31, 2022 was RMB4,177. For the year ended December 31, 2023, the Group incurred RMB3,231 services expense to Puyi Consulting and the balance of other payable as of December 31, 2023, was nil (iii) As disclosed in Note (9), the Group entered into a share repurchase agreement with HPH, pursuant to which the Group agreed to transfer all of its 4.46% equity interests in HPH back to HPH on December 22, 2023. Concurrently, a wholly-owned subsidiary of the Group entered into a share transfer agreement with HPH to acquire 15.41% equity interests in Puyi Fund, a wholly-owned subsidiary of HPH, at the aggregate consideration of the aforementioned 4.46% equity interests in HPH and cash of RMB10,463. (iv) As disclosed in Note (3)(d), the Group acquired 100% equity interest in Puyi Family Office (Chengdu) from HPH for a nominal consideration on December 31, 2023. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | (21) Commitments and Contingencies As of December 31, 2023, there was no pending legal proceeding to which the Group is a party that will have a material effect on the Group’s business, results of operations or cash flows. |
Concentrations of Credit Risk
Concentrations of Credit Risk | 12 Months Ended |
Dec. 31, 2023 | |
Concentrations of Credit Risk [Abstract] | |
Concentrations of Credit Risk | (22) Concentrations of Credit Risk Concentration risks Customers accounting for 10% or more of total net revenues excluding estimated renewal commissions are as follows: Year ended December 31, 2021 % of 2022 % of 2023 % of RMB RMB RMB Sinatay Life Insurance Co., Ltd. (“Sinatay”) 451,840 15.0 % 497,143 19.6 % 438,026 15.3 % Aeon Life Insurance Co., Ltd. (“Aeon”). 437,132 14.5 % * * 295,217 10.3 % Huaxia Life Insurance Company Limited (“Huaxia”) 323,800 10.7 % * * * * Subtotal 1,212,772 40.2 % 497,143 19.6 % 733,243 25.6 % * represented less than 10% of total net revenues for the year. Customers which accounted for 10% or more of gross accounts receivable excluding estimated renewal commissions are as follows: As of December 31, 2022 % 2023 % RMB RMB Sinatay 124,847 23.4 % 57,119 14.7 % Greatwall Life Insurance Co., Ltd 85,616 16.0 % 63,455 16.3 % Subtotal 210,463 39.4 % 120,574 31.0 % * represented less than 10% of accounts receivable as of the year end. The Group performs ongoing credit evaluations of its customers and generally does not require collateral on accounts receivable. The Group places its cash and cash equivalents and short-term investments with financial institutions with low credit risk. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Compensation [Abstract] | |
Share-based compensation | (23) Share-based Compensation (a) 2022 Options On August 12, 2022, the Company granted share options (“2022 Options”) to its independent directors to purchase up to 4,000,000 ordinary shares of the Company. Pursuant to the option agreements entered into between the Company and the option grantees, the options vest over a four-year service period starting from the date of grant, with 30% (“Option D1”), 30% (“Option D2”), 20% (“Option D3”) and the remaining 20% (“Option D4”) of the options being vested on August 31 of each of the years starting from 2023 to 2026, respectively, subject to the continuous service of the option grantees. The 2022 Options expire no later than August 1, 2032, subject to earlier termination upon an optionee’s cessation of service. The 2022 Options had an exercise price of US$0.2305 (RMB1.64) and an intrinsic value of US$0.0020 (RMB0.01) per ordinary share on the date of grant. The fair value of the options was determined by using the Black-Scholes option pricing model. For the year ended December 31, 2023, changes in the status of total outstanding options, were as follows: Number of Weighted Weighted Aggregate Outstanding as of January 1, 2023 and December 31, 2023 4,000,000 0.2305 5.19 408 For the years ended December 31, 2022 and 2023, share-based compensation expenses of RMB461 and RMB1,481 were recognized in connection with the 2022 Options, respectively. As of December 31, 2022 and 2023, unrecognized share-based compensation expense related to unvested share options granted to the independent directors totaled RMB3,942 and RMB2,684, respectively. The unvested share options expense relating to the share options with a graded vesting schedule is expected to be recognized over a weighted-average period of 2.6 years on a straight-line basis at an amount which at least equals the portion of the grant-date fair value of the 2022 Options that are vested at that date. (b) Restricted Share Units (“RSUs”) In August of 2023, the Company granted 536,990 ADSs to an executive office. Pursuant to the agreement entered into between the Company and the grantee, the ADSs vest over a five-year service period starting from the date of grant, with 100,000 ADSs, 100,000 ADSs, 136,990 ADSs, 100,000 ADSs and the remaining 100,000 ADSs being vested on June 30 of each of the years starting from 2024 to 2028, respectively, subject to the continuous service of the grantee (“RSUs”). The fair value of the RSUs was measured as the grant-date market price of the Company’s stock at US$6.35/ADS. A summary of the activity of the service-based RSUs for the year ended December 31, 2023 is presented as follows: Number of restricted shares Weighted average fair value US$ Unvested as of January 1, 2023 — — Granted 536,990 3,410 vested — — Forfeited — — Unvested as of December 31, 2023 536,990 3,410 The Company recorded share-based compensation expense of RMB1,987 in connection with the RSUs for the year ended December 31, 2023. As of December 31, 2023, unrecognized share-based compensation expense related to unvested RSUs granted to the executive officer with a graded vesting schedule totaled RMB22,258, which is expected to be recognized over a weighted-average period of 4.5 years on a straight-line basis at an amount which at least equals the portion of the grant-date fair value of the RSUs that are vested at that date. (c) 2023 Million Dollar Round Table Options (“2023 MDRT Options”) On February 6, 2023, the Company granted share options, or the 2023 MDRT Options, to its independent high-performing agents to purchase up to 13,680,000 ordinary shares of the Company. Pursuant to the option agreements entered into between the Company and the option grantees, the options vest over a two-year service period starting from the date of grant, with 50% and the remaining 50% of the options being vested on March 31, 2024 and March 31, 2025, respectively, subject to the continuous service of the option grantees and the achievement of the performance conditions. The 2023 MDRT Options expire no later than August 1, 2027, subject to earlier termination upon an optionee’s cessation of service. The 2023 MDRT Options had an exercise price of US$0.0500 (RMB0.35) and an intrinsic value of US$0.3125 (RMB2.22) per ordinary share on the date of grant. The Group used the binomial option pricing model in determining the fair value of the options granted, which requires the input of highly subjective assumptions, including the expected life of the stock option, stock price volatility, dividend rate and risk-free interest rate. The assumptions used in determining the fair value of the 2023 MDRT Options on the grant date were as follows: Assumptions February 6, Expected dividend yield (Note i) 3.69% Risk-free interest rates (Note ii) 3.88% Expected volatility (Note iii) 51.41% Expected life in years (Note iv) 4.49 Exercise multiple (Note v) 2.80 Fair value of options on grant date US$0.2896 ~ US$0.2997 (i) Expected dividend yield: The expected dividend yield was estimated by the Group based on its historical and future dividend policy. (ii) Risk-free interest rate: Risk-free interest rate was estimated based on the US Government Bond yield and pro-rated according to the tenor of the options as of the valuation date. (iii) Expected volatility: The volatility of the underlying ordinary shares was estimated based on the annualized standard deviation of the continuously compounded rate of return on the daily average adjusted share price of the Group as of the Valuation Date. (iv) Expected life: The expected life was estimated based on the end of the vesting period and the contractual term of the award of the 2023 MDRT Options. (v) Exercise multiple: The exercise multiple was estimated based on empirical studies. A summary of share options outstanding as of December 31, 2023, and activity during the year then ended, is presented below: Number of Weighted Weighted Aggregate Outstanding as of January 1, 2023 — — — — Granted 13,680,000 0.0500 4.49 4,275 Exercised — — — — Forfeited (2,380,000 ) — — — Outstanding as of December 31, 2023 11,300,000 0.0500 3.59 3,192 For the year ended December 31, 2023, share-based compensation expense of RMB13,627 was recognized in connection with the 2023 MDRT Options. As of December 31, 2023, unrecognized share-based compensation expense related to unvested 2023 MDRT Options totaled RMB9,918, which is expected to be recognized over a weighted-average period of 1.25 years on a straight-line basis. The Group estimates that the forfeiture rate for the independent high-performing agents will be approximately 17% for the year ended December 31, 2023. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Reporting | (24) Segment Reporting As of December 31, 2022 and 2023, the Group operated two segments: (1) the insurance agency segment, which mainly consists of providing agency services for distributing life and P&C insurance products on behalf of insurance companies, and (2) the claims adjusting segment, which consists of providing pre-underwriting survey services, claim adjusting services, disposal of residual value services, loading and unloading supervision services, and consulting services. Operating segments are defined as components of an enterprise about which separate financial information is available and evaluated regularly by the Group’s chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Group’s CODM is the Chief Executive Officer. The following table shows the Group’s operations by business segment for the years ended December 31, 2021, 2022 and 2023. Other represents revenue and expenses that are not allocated to reportable segments and corporate related items. Year ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ Net revenues Agency 2,811,936 2,376,851 2,760,448 388,801 Claims Adjusting 459,178 404,763 437,941 61,683 Total net revenues 3,271,114 2,781,614 3,198,389 450,484 Operating costs and expenses Agency (2,418,444 ) (2,068,194 ) (2,422,386 ) (341,187 ) Claims Adjusting (442,349 ) (416,619 ) (418,589 ) (58,958 ) Other (108,416 ) (128,126 ) (161,589 ) (22,758 ) Total operating costs and expenses (2,969,209 ) (2,612,939 ) (3,002,564 ) (422,903 ) Income (loss) from operations Agency 393,492 308,657 338,062 47,614 Claims Adjusting 16,829 (11,856 ) 19,352 2,725 Other (108,416 ) (128,126 ) (161,589 ) (22,758 ) Income from operations 301,905 168,675 195,825 27,581 As of December 31, 2022 2023 2023 RMB RMB US$ Segment assets Agency 1,513,449 2,515,467 354,296 Claims Adjusting 252,130 259,325 36,524 Other 1,323,937 1,276,092 179,735 Total assets 3,089,516 4,050,884 570,555 Substantially all of the Group’s revenues for the three years ended December 31, 2021, 2022 and 2023 were generated from the PRC. A substantial portion of the identifiable assets of the Group is located in the PRC. Accordingly, no geographical segments are presented. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent events | (25) Subsequent events Significant Investment from White Group On February 2, 2024, the Group entered into a framework agreement with Singapore White Group Pte. Ltd. (“White Group”). Pursuant to the framework agreement, White Group and its partners intend to invest up to US$500 million in the Group. Subsequently, the Group and White Group entered into a supplementary agreement on February 20, 2024, according to which, in addition to the up to US$500 million investment, both parties will explore investments in certain high-quality assets including an Asia-based telehealth solution provider and an AI Humanoid hardware manufacturer. Up to the date the consolidated financial statements are issued, there is no substantial investment that has been initiated. 2023 Share Incentive Plan On February 20, 2024, the board of directors (the “board”) adopted a share incentive plan under which the Group has reserved 113,423,618 ordinary shares for issuance, which was approximately 10% of the outstanding ordinary shares as of December 31, 2023. Up to the date the consolidated financial statements are issued, no options or RSUs have been granted under the share incentive plan. 2024 Share Option Grants On February 2, 2024, share options were granted to certain employees of the Group and top agents to purchase 5,799,925 ADSs of HPH as a supplement of salary and benefit packages. Pursuant to the share incentive program, the exercise price of these options is US$0.001 per HPH’s ADS. The options are scheduled to vest over a one-year period starting from March 1, 2025, subject to the achievement of certain key performance indicators by the option holders and their continued service with the Group. |
Schedule I_Condensed Financial
Schedule I—Condensed Financial Information of the Company | 12 Months Ended |
Dec. 31, 2023 | |
Schedule I—Condensed Financial Information of the Company [Abstract] | |
SCHEDULE I—CONDENSED FINANCIAL INFORMATION OF THE COMPANY | Balance Sheets ( In thousands, except for shares and per share data As of December 31, 2022 2023 2023 RMB RMB US$ Note2(u) ASSETS: Current assets: Cash and cash equivalents 38,512 23,595 3,323 Short term investments 27,619 — — Other receivables and amounts due from subsidiaries and affiliates 417,613 450,933 63,513 Total current assets 483,744 474,528 66,836 Non-current assets: Investment in subsidiaries 2,520,667 3,010,729 424,052 Investment in an affiliate 4,035 — — Other non-current asset — 13,461 1,896 Total assets 3,008,446 3,498,718 492,784 LIABILITIES AND SHAREHOLDERS’ EQUITY: Current liabilities: Other payables and accrued expenses and amounts due to subsidiaries 1,385,043 1,427,456 201,053 Total liabilities 1,385,043 1,427,456 201,053 Ordinary shares (Authorized shares:10,000,000,000 at US$0.001 each; issued 1,074,291,784 and 1,158,913,224 shares, of which 1,072,842,484 and 1,134,236,184 shares were outstanding as of December 31, 2022 and 2023, respectively) 8,091 8,675 1,222 Treasury Stock (10 ) (178 ) (25 ) Additional paid-in capital 461 162,721 22,919 Retained earnings 1,647,504 1,927,981 271,550 Accumulated other comprehensive loss (32,643 ) (27,936 ) (3,935 ) Total equity 1,623,403 2,071,263 291,731 Total liabilities and shareholders’ equity 3,008,446 3,498,719 492,784 Statements of Income and Comprehensive Income (In thousands) Year Ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ General and administrative expenses (331 ) (11,318 ) (11,018 ) (1,552 ) Selling expenses — — (13,627 ) (1,919 ) Interest income 2 5 1,201 169 Others, net — 17,495 17,009 2,395 Equity in earnings of subsidiaries and an affiliate 251,318 94,090 286,912 40,411 Net Income attributable to the Company’s shareholders 250,989 100,272 280,477 39,504 Other comprehensive income (loss): Foreign currency translation adjustments (9,116 ) 3,728 2,249 317 Unrealized net gains on available-for-sale investments 6,252 (1,919 ) 2,458 346 Share of other comprehensive (loss) gain of affiliates (1,281 ) 4,688 — — Comprehensive income attributable to the Company’s shareholders 246,844 106,769 285,184 40,167 Statements of Cash Flows ( In thousands Year Ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ Cash flow from operating activities: Net income 250,989 100,272 280,477 39,504 Adjustments to reconcile net income to net cash used in operating activities: Equity in earnings of subsidiaries and an affiliate (251,318 ) (94,090 ) (312,323 ) (43,990 ) Compensation expenses associated with stock options — 461 17,095 2,408 Other non-cash adjustments — — (22,569 ) (3,179 ) Changes in operating assets and liabilities: Other receivables 392 — (20 ) (3 ) Accrued payroll and Other payables (847 ) 696 820 116 Net cash (used in) from operating activities (784 ) 7,339 (36,520 ) (5,144 ) Cash flows (used in) generated from investing activities Changes in investment in subsidiaries and an affiliate 43,757 907,006 2,458 346 Advances to subsidiaries and affiliates 157,582 (689,780 ) (10,005 ) (1,409 ) Proceeds from disposal of short-term investments — 10,095 27,639 3,893 Net cash generated from investing activities 201,339 227,321 20,092 2,830 Cash flows generated from (used in) financing activities: Proceeds on exercise of stock options — 2 — — Dividends paid (242,518 ) (317,730 ) — — Repurchase of ordinary shares from open market — (3,984 ) (29,044 ) (4091 ) Net cash generated used in financing activities (242,518 ) (321,712 ) (29,044 ) (4,091 ) Net decrease in cash and cash equivalents (41,963 ) (87,052 ) (45,472 ) (6,405 ) Cash and cash equivalents and restricted cash at beginning of year 66,345 14,507 38,512 5,424 Effect of exchange rate changes on cash and cash equivalents (9,875 ) 111,057 30,555 4,304 Cash and cash equivalents and restricted cash at end of the year 14,507 38,512 23,595 3,323 Schedule I has been provided pursuant to the requirements of Rule 12-04(a), 5-04(c) and 4-08(e)(3) of Regulation S-X, which require condensed financial information as to the financial position, cash flows and results of operations of a parent company as of the same dates and for the same periods for which audited consolidated financial statements have been presented when the restricted net assets of the consolidated and unconsolidated subsidiaries (including variable interest entities) together exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. As of December 31, 2023, RMB1,510,070 of the restricted capital and reserves are not available for distribution, and as such, the condensed financial information of the Company has been presented for the years ended December 31, 2021, 2022 and 2023. As of December 31, 2023, there were no material contingencies, significant provisions of long-term obligations, and mandatory dividend or redemption requirements of redeemable shares or guarantees of the Company except for those which have been separately disclosed in the consolidated financial statements, if any. Basis of preparation The condensed financial information of the Company has been prepared using the same accounting policies as set out in the accompanying consolidated financial statements except that the equity method has been used to account for investments in its subsidiaries. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. The footnote disclosures contain supplemental information relating to the operations of the Company and, as such, these statements should be read in conjunction with the notes to the consolidated financial statements of the Group as of December 31, 2022 and 2023 and the years ended 2021, 2022 and 2023. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | (a) Basis of Presentation and Consolidation The consolidated financial statements of the Group have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The consolidated financial statements include the financial statements of the Company, all its subsidiaries and those VIEs of which the Company is the primary beneficiary from the dates they were acquired or incorporated. All intercompany balances and transactions have been eliminated in consolidation. In order to comply with the PRC laws and regulations which prohibit or restrict foreign control of companies involved in provision of internet content and other restricted businesses, the Group operates certain of its businesses which are subject to restrictions in the PRC through PRC domestic companies, whose equity interests are held by certain individuals (“Nominee Shareholders”). The Group obtained control over these PRC domestic companies by entering into a series of contractual arrangements with these PRC domestic companies and their respective Nominee Shareholders. Management concluded that these PRC domestic companies are consolidated VIEs of the Group, of which the Group is the primary beneficiary. As such, the Group consolidated the financial results of these PRC domestic companies and their subsidiaries in the Group’s consolidated financial statements. See Note 12 for details. |
Use of Estimates | (b) Use of Estimates The preparation of the consolidated financial statements in conformity with US GAAP requires management of the Group to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. The Group evaluates estimates, including those related to the amounts of variable considerations of revenue contracts with respect to long-term life insurance products, the allowance for credit losses of accounts receivable, contract assets and other receivables, fair values of identifiable assets acquired, liabilities assumed and consideration transferred in business combinations, share-based payments and certain debt and equity investments, the useful lives of intangible assets and property, plant and equipment, impairment of long-lived assets, goodwill, and other long-term equity investments, and deferred tax valuation allowance among others. The Group, based their estimates on historical experience and various other factors, believed to be reasonable under the circumstances, that the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. |
Cash and Cash Equivalents and Restricted Cash | (c) Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents consist of cash on hand, bank deposits and short-term, highly liquid investments, which have original maturities of three months or less, and that are readily convertible to known amounts of cash and have insignificant risk of changes in value related to changes in interest rates. In its capacity as an insurance agent, the Group collects premiums from the insureds and remits the premiums to the appropriate insurance companies. Accordingly, as reported in the consolidated balance sheets, “premiums” are receivables from the insureds of RMB15,847 and RMB14,986 as of December 31, 2022 and 2023, respectively. Unremitted net insurance premiums are held in a fiduciary capacity until disbursed by the Group. The Group invests these unremitted funds only in cash accounts held for a short term and reports such amounts as restricted cash in the consolidated balance sheets. Also, restricted cash balance includes the entrustment deposit received from the members of eHuzhu, an online mutual aid platform operated by the Group, which is to be used during the one-year operating cycle and is therefore classified as a current asset. The balance for entrustment deposit was RMB44,110 and RMB38,252 as of December 31, 2022 and 2023, respectively. Further, restricted cash balance includes guarantee deposit required by the National Financial Regulatory Administration which replaces the China Banking and Insurance Regulatory Commission as the regulatory body since May 2023 in order to protect insurance premium appropriation by insurance agency which is restricted as to withdrawal for other than current operations. Thus, the Group classified the balance for guarantee deposit as a non-current asset. The balance for guarantee was RMB20,729 and RMB27,228 as of December 31, 2022 and 2023, respectively. |
Short Term Investments | (d) Short Term Investments All investments with original maturities less than twelve months or investments that are expected to be realized in cash during the next twelve months are classified as short-term investments. The Group accounts for short-term debt investments in accordance with ASC Topic 320, Investments – Debt Securities Securities that the Group has the positive intent and ability to hold to maturity are classified as held-to-maturity securities and stated at amortized cost less allowance for credit losses. The Group has no debt investments classified as trading. The Group’s short term investments are mainly available-for-sale debt securities that do not have a quoted market price in an active market. Available-for-sale investments are carried at fair values and the unrealized gains or losses from the changes in fair values are included in accumulated other comprehensive income or loss. The Group benchmarks the values of its other investments against fair values of comparable investments and reference to product valuation reports as of the balance sheet date and categorizes all fair value measures of short term investments as level 2 of the fair value hierarchy. The Group evaluates each individual available-for-sale debt securities periodically for impairment. For investments where the Group does not intend to sell, the Group evaluates whether a decline in fair value is due to deterioration in credit risk. Credit-related impairment losses, not to exceed the amount that fair value is less than the amortized cost basis, are recognized through an allowance for credit losses on the consolidated balance sheet with corresponding adjustment in the consolidated statements of income and comprehensive income. Subsequent increases in fair value due to credit improvement are recognized through reversal of the credit loss and corresponding reduction in the allowance for credit loss. Any decline in fair value that is non-credit related is recorded in accumulated other comprehensive income as a component of shareholder’s equity. As of December 31, 2023, there were no investments held by the Group that had been in continuous unrealized loss position. No impairment loss on short term investments was identified for years ended December 31, 2021, 2022 and 2023, respectively. |
Accounts Receivable and Contract Assets | (e) Accounts Receivable and Contract Assets Accounts receivable are recorded at the amount that the Group expects to collect and do not bear interest. Accounts receivables represent fees receivable on agency and claims adjusting services primarily from insurance companies. Contract assets are recorded when a long-term life insurance policy becomes effective, of which, the portion in relation to initial commissions earned is reclassified to accounts receivable upon the hesitation period expires; and the remaining portion arising from estimated renewal commissions will be reclassified to accounts receivable once the initial policy has been renewed and/or the Group has achieved certain renewal target in subsequent years within the renewal term of the policy. Accounts receivable are generally settled within 90 days since the initial recognition pursuant to the payment terms in the contract with customers, of which a minor portion relating to bonus earned based on annual performance condition is settled within one year. The Group evaluates the collectability of its accounts receivable and contract assets based on a combination of factors. The Group generally does not require collateral on trade receivables and contract assets as the majority of the Group’s customers are large, well-established insurance companies. The provision of credit losses for accounts receivable and contract assets is based upon the current expected credit losses (“CECL”) model by pooling accounts receivable and contract assets into various age buckets. The entire contract assets balance is included in the bucket of within 1 year. The expected credit loss rates applied range from 0.01% to 100%. In assessing the CECL, the Group considers both quantitative and qualitative information that is reasonable and supportable, including relevant available information from internal and external sources, related to past events, historical credit loss experience, current and future economic events as well as other conditions that may be beyond the Group’s control. Credit loss expenses are assessed quarterly and included in general and administrative expense on the consolidated statements of income and comprehensive income. Accounts receivable that are deemed uncollectible when all collection efforts have been exhausted are written off against the allowance for credit loss. Accounts receivable and contract assets, net is analyzed as follows: As of December 31, 2022 2023 RMB RMB Accounts receivable 408,961 295,562 Contract assets (See Note 2(q)) 659,788 1,071,064 Allowance for doubtful accounts (15,361 ) (15,784 ) Accounts receivable and contract assets, net 1,053,388 1,350,842 The following table summarizes the movement of the Group’s allowance for expected credit losses of accounts receivable and contract assets: 2021 2022 2023 RMB RMB RMB Balance at the beginning of the year 29,000 28,025 15,361 Current period provision for (reversal of) expected credit losses 2,095 (1,378 ) 4,036 Write-offs (3,070 ) (11,286 ) (3,613 ) Balance at the end of the year 28,025 15,361 15,784 |
Property, Plant and Equipment | (f) Property, Plant and Equipment Property, plant and equipment are stated at cost. Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives, taking into account residual value: Estimated Estimated Building 20-36 0% Office equipment, furniture and fixtures 3-5 0%-3% Motor vehicles 5-10 0%-3% Leasehold improvements 5 0% The depreciation methods and estimated useful lives are reviewed regularly. The following table summarizes the depreciation expense recognized in the consolidated statements of income and comprehensive income: 2021 2022 2023 RMB RMB RMB Operating costs 791 822 576 Selling expenses 5,778 5,106 4,368 General and administrative expenses 11,773 13,545 11,248 Depreciation expense 18,342 19,473 16,192 |
Business combinations and non-controlling interests | (g) Business combinations and non-controlling interests The Group evaluates acquisitions of assets to assess whether or not the transaction should be accounted for as a business combination or asset acquisition. In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs. The Group applies a ‘screen test’ that permits a simplified assessment of whether an acquired set of activities and assets is not a business. The test is met if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. Transactions in which the acquired is considered a business are accounted for as a business combination as described below. Conversely, transactions not considered as business acquisition are accounted for as acquisition of assets and liabilities. In such transactions, the cost of acquisition is allocated proportionately to the acquired identifiable assets and liabilities, based on their proportionate fair value on the acquisition date. In an asset acquisition, no goodwill is recognized. The Group accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805 “Business Combinations”. The consideration transferred in a business combination is measured as the aggregate of the acquisition-date fair value of the assets transferred, liabilities incurred by the Group to the selling shareholders of the acquiree, and the equity interests issued by the Group. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets acquired and liabilities assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the consideration transferred, the fair value of any non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree, is recorded as goodwill. The consideration for the Group’s business acquisitions may include future payments that are contingent upon the occurrence of a particular event or events. Contingent consideration also takes the form of a right of the Group to the returns of previously transferred assets or issued equity interests from the sellers of the acquired business. Both the rights and obligations for such contingent consideration returns and payments are recorded at fair value on the acquisition date. The Group’s contingent right to receive a return of some equity interests issued (i.e., contingently returnable shares) is recognized as an asset and measured at fair value. The Group’s obligation to pay contingent consideration is recognized and classified as a liability and measured at fair value. The contingent consideration rights and obligations are subsequently evaluated each reporting period with changes in fair value recognized as a gain or loss and recorded within change in the fair value of contingent assets and liabilities in the consolidated statements of income and comprehensive income. For the Group’s majority-owned subsidiaries and subsidiaries of VIEs, a non-controlling interest is recognized to reflect the portion of their equity which is not attributable, directly or indirectly, to the Group. Consolidated net income on the consolidated statements of income and comprehensive income includes the net income attributable to non-controlling interests. The cumulative results of operations attributable to non-controlling interests, are recorded as non-controlling interests on the Group’s consolidated balance sheets. |
Goodwill and Other Intangible Assets | (h) Goodwill and Other Intangible Assets Goodwill Goodwill represents the excess of costs over fair value of net assets of businesses acquired in a business combination. Goodwill is not amortized, but is tested for impairment at the reporting unit level at least on an annual basis at the balance sheet date or more frequently if certain indicators arise. The Group operated in two reporting units for the years ended December 31, 2022 and 2023. The impairment test is performed as of year-end or if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount by comparing the fair value of a reporting unit with its carrying value. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired and no further testing is required. If the fair value of the reporting unit is less than the carrying value, an impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The impairment review is highly judgmental and involves the use of significant estimates and assumptions. These estimates and assumptions have a significant impact on the amount of any impairment charge recorded. Estimates of fair value are primarily determined by using discounted cash flows. Discounted cash flows method is dependent upon assumptions of future sales trends, market conditions and cash flows of each reporting unit over several years. Actual cash flows in the future may differ significantly from those previously forecasted. Other significant assumptions include growth rates and the discount rate applicable to future cash flows. Based on this quantitative test in 2022 and 2023, it was determined that the fair value of each reporting unit tested exceeded its carrying amount and, therefore, the management concluded that goodwill was not impaired as of December 31, 2022 and 2023, respectively. Intangible Assets Identifiable intangibles assets are required to be determined separately from goodwill based on their fair values. In particular, an intangible asset acquired in a business combination should be recognized as an asset separate from goodwill if it satisfies either the “contractual-legal” or “separability” criterion. Intangible assets with a finite economic life are carried at cost less accumulated amortization. The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives on a straight-line basis. The estimated useful lives for the Group’s intangible assets are as follows: Estimated useful life (Years) Software 3 Non-compete agreements 5.8 - 6 Agent resources 2.8 - 3 Brokerage license 20 |
Investment in Affiliates | (i) Investment in Affiliates The Group uses the equity method of accounting for investments in which the Group has the ability to exercise significant influence, but does not have a controlling interest. The Group continually reviews its investment in equity investees to determine whether a decline in fair value to an amount below the carrying value is other-than-temporary. The primary factors the Group considers in its determination are the duration and severity of the decline in fair value; the financial condition, operating performance and the prospects of the equity investee; and other company specific information such as the stock price of the investee and its corresponding volatility, if publicly traded, the Group’s intent and ability to hold the investment until recovery, and changes in the macro-economic, competitive and operational environment of the investee. If the decline in fair value is deemed to be other-than-temporary, the carrying value of the equity investee is written down to fair value. |
Long-term Investments | (j) Long-term Investments Other non-current assets mainly represent long-term equity investments accounted for under the measurement alternative method, contingent consideration measured at fair value through profit or loss (see Note 2 (g) and Note 3 for details) and an investment in debt securities classified as held-to-maturity which is measured at amortized cost. Equity securities without readily determinable fair value The Group has long-term investments in equity security of certain privately held companies which the Group exerts no significant influence or a controlling interest. As a result of adoption of “ Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities During each reporting period, the Group makes a qualitative assessment considering impairment indicators to separately evaluate whether each of its equity securities without readily determinable fair value is impaired. Impairment indicators that the Group considers include, but are not limited to a significant deterioration in the earnings performance, credit rating, asset quality, or business prospects of the investee, factors such as negative cash flows from operations and working capital deficiencies that raise significant concerns about the investee’s ability to continue as a going concern, current economic and market conditions and other specific information. If a qualitative assessment indicates that the investment is impaired, the entity has to estimate the investment’s fair value in accordance with the principles of ASC 820. If the fair value is less than the investment’s carrying value, the Group recognizes an impairment loss in earnings equal to the difference between the carrying value and fair value. The Group recorded an impairment of nil nil Investment in debt securities with embedded features In 2023, the Group invested in a two-year-term debt security valued at RMB125,000 with a fixed return rate of 6% and an additional earning right contingently upon certain conditions met within the contract term. The Group evaluated the additional earning right as a derivative instrument that is “embedded” to the host contract in accordance with ASC 815. The Group considered the stated and implied substantive features of the contract as well as the economic characteristics and risks of the hybrid instrument and determined that the additional earning right be considered as an embedded derivative separated from the host contract and accounted it for as a derivative instrument. The Group classified the embedded derivative measured at fair value and change in fair value is charged through profit or loss. |
Impairment of Long-Lived Assets | (k) Impairment of Long-Lived Assets Property, plant, and equipment and intangible assets with definite lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying value of the asset exceeds the fair value of the asset. |
Insurance Premium Payables | (l) Insurance Premium Payables Insurance premium payables are insurance premiums collected on behalf of insurance companies but not yet remitted as of the balance sheet dates. |
Treasury shares | (m) Treasury Shares Treasury shares represent ordinary shares repurchased by the Group that are no longer outstanding and are held by the Group. The repurchased ordinary shares are recorded whereby the total par value of shares acquired is recorded as treasury stock and the difference between the par value and the amount of cash paid is recorded in additional paid-in capital. If additional paid-in capital is not available or is not sufficient, the remaining amount is to reduce retained earnings. Ordinary shares issued in business combinations through an exchange of equity interests that are subsequently returned to the Company are also accounted for treasury shares (see Note 3(a) and 3(c) for details). |
Income Taxes | (n) Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recognized for temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements, net operating loss carryforwards and credits by applying enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Group records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Group recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Group recognizes interest and penalties related to unrecognized tax benefits, if any, on the income tax expense line in the accompanying consolidated statement of income and comprehensive income. Accrued interest or penalties are included on the other tax liabilities line in the consolidated balance sheets. |
Share-based Compensation | (o) Share-based Compensation All forms of share-based payments to employees and nonemployees, including restricted share units, stock options and stock purchase plans, are treated the same as any other form of compensation by recognizing the related cost in the consolidated statements of income and comprehensive income. The Group recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the amount of compensation cost recognized at any date must at least equal to the portion of the grant-date value of the award that is vested at that date. For awards with both service and performance conditions, if each tranche has an independent performance condition for a specified period of service, the Group recognizes the compensation cost of each tranche as a separate award on a straight-line basis; if each tranche has performance conditions that are dependent of activities that occur in the prior service periods, the Group recognizes the compensation cost on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards. The Group has made an accounting policy election to account for forfeitures when they occur for an award with only service conditions. For an award with a performance condition, the Group continues to assess at each reporting period whether it is probable that the performance condition will be achieved. No compensation cost is recognized for instruments that employees and nonemployees forfeit because a service condition or a performance condition is not satisfied. Employee share-based compensation Compensation cost related to employee stock options or similar equity instruments is measured at the grant date based on the fair value of the award and is recognized over the service period, which is usually the vesting period. If an award requires satisfaction of one or more performance or service conditions (or any combination thereof), compensation cost is recognized if the requisite service is rendered, while no compensation cost is recognized if the requisite service is not rendered. Nonemployee share-based compensation Consistent with the accounting requirement for employee share-based compensation, nonemployee share-based compensation within the scope of Topic 718 are measured at grant-date fair value of the equity instruments, which the Group is obligated to issue when the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied. |
Employee Benefit Plans | (p) Employee Benefit Plans As stipulated by the regulations of the PRC, the Group’s subsidiaries in the PRC participate in various defined contribution plans organized by municipal and provincial governments for its employees. The Group is required to make contributions to these plans at a percentage of the salaries, bonuses and certain allowances of the employees. Under these plans, certain pension, medical and other welfare benefits are provided to employees. The Group has no other material obligation for the payment of employee benefits associated with these plans other than the annual contributions described above. The contributions are charged to the consolidated statements of income and comprehensive income as they become payable in accordance with the rules of the above mentioned defined contribution plans. |
Revenue Recognition | (q) Revenue Recognition The Group’s revenue from contracts with insurance companies is derived principally from the provision of agency and claims adjusting services, and insurance companies are defined as the Group’s customers under ASC 606 “Revenue from Contracts with Customers” (“ASC 606”). The Group disaggregates its revenue from different types of service contracts with customers by principal service categories, as the Group believes it best depicts the nature, amount, timing and uncertainty of its revenue and cash flows. See Note 24 for detailed disaggregated revenue information that is disclosed for each reportable segment. The following is a description of the accounting policy for the principal revenue streams of the Group. Insurance agency services revenue The Group derives agency revenue serving as a sales agent to distribute various life insurance and property and casualty (“P&C”) insurance products on behalf of insurance companies by which the Group is entitled to receive an initial commission from the insurance companies based on the premium paid by the policyholders for the related insurance policy sold. For life insurance agency, the Group is also entitled to renewal commissions when the policyholder renews the policy within the renewal term of the original policy as such life insurance products are typically long-term products. The Group has identified its promise to sell insurance products on behalf of an insurance company as the performance obligation in its contracts with the insurance companies. The Group’s performance obligation to the insurance company is satisfied and revenue is recognized at a point in time when an insurance policy becomes effective. Specifically for life insurance agency business, certain contracts include the promise to provide certain post-sales administrative services to policyholders on behalf of the insurance company, such as responding to the policyholder inquiries, facilitating the renewal process and/or gathering information from the policyholder to assist the insurance companies to update the contact information of the policy holder, the Group has concluded such services are administrative in nature and immaterial, and none of these activities on their own results in a transfer of a good or services to the insurance company in the context of the contract. Accordingly, no performance obligation exists after a policy becomes effective. Initial placement of an insurance policy The Group recognizes agency revenue related P&C insurance products (which is short term in nature and related premiums are collected upfront) when an insurance policy becomes effective. The commission to be earned is required to be partially refunded contingently on policy cancellations. Based on its past experience, subsequent commission adjustments in connection with P&C insurance policy cancellations have been de minims to date, and are recognized upon notification from the insurance carriers. Actual commission and fee adjustments in connection with the cancellation of P&C insurance policies were 0.1%, 0.1% and 0.1% of the total commission and fee revenues during years ended December 31, 2021, 2022 and 2023, respectively. For life insurance products, there is generally a 10 to 15 days hesitation period after an initial placement of a life insurance policy, during which the policyholder has a legal right to unconditionally cancel the effective policy regardless of the reasons. According to relevant terms of the insurance agency contracts with customers, the Group reconciles information of policies sold which also includes policies that have been cancelled by policyholders within the hesitation period, with the insurance companies on a monthly basis. Therefore, the Group estimates cancellation of policies that have become effective but are still within the hesitation period based on subsequent actual data at each reporting date. The cancellation of an effective life insurance policy by the policyholder after the hesitation period does not require the Group to refund initial commission to insurance companies, but rather impacts the Group’s estimate on future commission related to renewal(s) of the policy. In addition, for life insurance agency, the Group may receive a performance bonus from insurance companies as agreed and per contract provisions. Once the Group achieves a certain sales volume based on respective agency agreements, the bonus will become due. Performance bonus represents a form of variable consideration associated with certain sales volume, for which the Group earns commissions. The Group estimates the amount of consideration with a constraint applied that will be received in the coming year such that a significant reversal of revenue is not probable, and includes performance bonus as part of the transaction price. For the years ended December 31, 2021, 2022 and 2023, the Group recognized contingent performance bonus of RMB3,887, RMB11,387 and RMB18,161, respectively. Renewals of a life insurance policy For the long-term life insurance products, in addition to the initial commission earned, the Group is also entitled to subsequent renewal commission and compensation, and renewal performance bonus which represents variable considerations and are contingent on future renewals of initial policies or the Group achieves its performance target. When making estimates of the amount of variable consideration to which the Group expects to be entitled, the Group uses the expected value method and evaluates many factors, including but not limited to, insurance companies mix, product mix, renewal term of various products, renewal premium rates and commission rates, to determine the method(s) of measurement, relevant inputs and the underlying assumptions. The Group considers constraints as well when determining the amount which should be included in the transaction price. The Group performs ongoing evaluation of the appropriateness of the constraint applied and will consider the sufficiency of evidence that would suggest that the long-term expectation underlying the assumptions has changed. The Group makes an estimate of variable considerations over the portfolio of contracts based on accumulated historical data and experiences. The estimated renewal commissions are contingent on future renewals of initial policies or achievement of certain performance targets. Given the material uncertainty around the future renewal of the insurance policies, the estimated renewal commissions expected to be collected are recognized as revenue only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty is subsequently resolved. The judgment and assumptions are continuously re-evaluated and adjusted as needed along with the accumulation of historical experiences and data when new information becomes available. Actual renewal commissions in the future may differ significantly from those previously estimated. Insurance claims adjusting services revenue For insurance claims adjusting services, performance obligations are considered met and revenue is recognized when the services are rendered and completed, at the time loss adjusting reports are confirmed being received by insurance companies. The Group does not accrue any service fee before the receipt of an insurance company’s acknowledgement of receiving the adjusting reports. Any subsequent adjustments in connection with discounts which have been de minims to date are recognized in revenue upon notification from the insurance companies. Contract balances The Group’s contract balances include accounts receivable and contract asset. The balances of accounts receivable as of December 31, 2022 and 2023 are all derived from contracts with customers. The Group recognized revenues and correspondent contract assets derived from estimated renewal commissions for selling long-term life insurance products because it is entitled to payments of the subsequent renewal commissions which is contingent on future renewals of initial policies and/or the achievement of its performance target set forth in relation to future renewals other than the passage of time. Accordingly, the Group presented contract assets separately in the consolidated balance sheets which include both the amount derived from estimated renewal commissions and the amount of commissions in relation to policies that are still within the hesitation period by the year-end date. The contract assets balance will be reclassified to accounts receivable once the initial policies have been renewed and/or the Group has achieved certain renewal target in subsequent years within the renewal term of the policies, or upon the hesitation period expires. Practical expedients and exemptions The Group generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within sales and marketing expenses in the consolidated statements of income and comprehensive income, as the amortization period is less than one year and the Group has elected the practical expedient included in ASC 606. The Group has applied the optional exemption provided by ASC 606 to not disclose the value of remaining performance obligations not yet satisfied as of period end for contracts with original expected duration of one year or less. Value-added tax and surcharges The Group presents revenue net of tax surcharges and value-added taxes incurred. The tax surcharges amounted to RMB19,235, RMB14,681 and RMB14,258 for the years ended December 31, 2021, 2022 and 2023, respectively. Total value-added taxes paid by the Group during the years ended December 31, 2021, 2022 and 2023 amounted to RMB179,183, RMB130,743 and RMB138,234 respectively. |
Fair Value of Financial Instruments | (r) Fair Value of Financial Instruments Fair value is considered to be the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. The established fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs may be used to measure fair value include: Level 1 Applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 Applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 Applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The carrying values of the Group’s financial instruments, including cash and cash equivalents, restricted cash, accounts receivable, insurance premium payables, other receivables, short-term loan, accounts payable and other payables, approximate their fair values due to the short-term nature of these instruments. The carrying amounts of the long-term receivables and payables approximate their fair value as the interest rates are comparable to the prevailing interest rates in the market. Measured at fair value on a recurring basis As of December 31, 2022 and 2023, information about inputs into the fair value measurements of the Group’s assets and liabilities that are measured at fair value on a recurring basis in periods subsequent to their initial recognition is as follows. Fair Value Measurements Description As of Quoted Significant Significant RMB RMB RMB RMB Short-term investments - debt security 331,228 — 331,228 — Fair Value Measurements Description As of Quoted Significant Significant RMB RMB RMB RMB Short-term investments - debt security 925,678 — 925,678 — Investments – equity security recorded within other current assets 96,343 96,343 — — Contingent consideration 13,461 — — 13,461 The majority of debt security consists of investments in bank financial products, trust products and asset management plans that normally pay a prospective fixed rate of return. These investments are recorded at fair values on a recurring basis. The Group measured these investments at fair values and the unrealized gains or losses from the changes in fair values are included in accumulated other comprehensive income or loss, at the balance sheet date. It is classified as Level 2 of the fair value hierarchy since fair value measurement at the reporting date is benchmarked against fair value of comparable investments. The Group measures its equity investments with readily determinable fair value at its quoted price in active markets. There were no transfers into or out of Level 1 and Level 2 as of December 31, 2023. Level 3 fair value of contingent consideration arising from business combination is determined using the Monte Caro simulation model and significant assumptions including the probability of achieving performance targets for each scenario and estimated share price during the specified period. For the year ended December 31, 2023, the Group recorded gains on changes in fair value of contingent consideration of RMB6,650. Measured at fair value on a non-recurring basis The Group measures certain assets, including equity securities without readily determinable fair values, equity method investments and intangible assets, at fair value on a nonrecurring basis when they are deemed to be impaired. The fair values of these investments and intangible assets are determined based on valuation techniques using the best information available, and may include management judgments, future performance projections, etc. An impairment charge to these investments is recorded when the cost of the investment exceeds its fair value and for equity method investments, this condition is determined to be other-than-temporary. Impairment charge to the intangible assets is recorded when their carrying amounts may not be recoverable. Goodwill (Note 7) is measured at fair value on a nonrecurring basis, and they are recorded at fair value only when impairment is recognized by applying unobservable inputs such as forecasted financial performance of the acquired business, discount rate, etc. to the discounted cash flow valuation methodology that are significant to the measurement of the fair value of these assets (Level 3). Investments in affiliates (Note 9) are measured at fair value on a nonrecurring basis, and they are recorded at fair value only when there is other-than-temporary-impairment. The fair value of investment in an affiliate that is publicly listed is determined based on the market value of its share (Level 1) on the date such impairment is recorded. |
Foreign Currencies | (s) Foreign Currencies The functional currency of the Company is the United States dollar (“USD”). Assets and liabilities are translated at the exchange rates at the balance sheet date, equity accounts are translated at historical exchange rates and revenues, expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as cumulative translation adjustments and are shown as a separate component of other comprehensive income or loss in the consolidated statements of income and comprehensive income. The Group has chosen the Renminbi (“RMB”) as their reporting currency. The functional currency of most of the Company’s subsidiaries is RMB. Transactions in other currencies are recorded in RMB at the rates of exchange prevailing when the transactions occur. Monetary assets and liabilities denominated in other currencies are translated into RMB at rates of exchange in effect at the balance sheet dates. Exchange gains and losses are recorded in the consolidated statements of income and comprehensive income. |
Foreign Currency Risk | (t) Foreign Currency Risk The RMB is not a freely convertible currency. The State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into foreign currencies. The value of RMB is subject to changes in central government policies and international economic and political developments that affect supply and demand in the China Foreign Exchange Trading System market of cash and cash equivalents and restricted cash. The Group had aggregate amounts of RMB600,901 and RMB557,585 of cash and cash equivalents and restricted cash denominated in RMB as of December 31, 2022 and 2023, respectively. |
Translation into USD | (u) Translation into USD The consolidated financial statements of the Group are stated in RMB. Translations of amounts from RMB into USD are solely for the convenience of the readers outside of China and were calculated at the rate of US$1.00 = RMB7.0999, representing the noon buying rate in the City of New York for cable transfers of RMB on December 29, 2023, the last business day in fiscal year 2023, as set forth in H.10 statistical release of the Federal Reserve Bank of New York. The translation is not intended to imply that the RMB amounts could have been, or could be, converted, realized or settled into USD at such rate. |
Segment Reporting | (v) Segment Reporting As of December 31, 2022 and 2023, the Group operated two segments: (1) the insurance agency segment, which mainly consists of providing agency services for P&C insurance products and life insurance products to individual clients, and (2) the claims adjusting segment, which consists of providing pre-underwriting survey services, claim adjusting services, disposal of residual value services, loading and unloading supervision services, and consulting services. Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the Group’s chief operating decision maker in deciding how to allocate resources and in assessing performance. Substantially all revenues of the Group are derived in the PRC and all long-lived assets are located in the PRC. |
Earnings per Share (“EPS”) or ADS | (w) Earnings per Share (“EPS”) or ADS Basic EPS is calculated by dividing the net income available to common shareholders by the weighted average number of ordinary shares /ADS outstanding during the year. Diluted EPS is calculated by using the weighted average number of ordinary shares /ADS outstanding adjusted to include the potentially dilutive effect of outstanding share-based awards, unless their inclusion in the calculation is anti-dilutive. The weighted average number of ordinary shares outstanding excludes the number of ordinary shares issued in business combinations (see Note 3 for details) through an exchange of equity interests that are outstanding but contingently returnable, all or partial, if necessary conditions are not satisfied by specific periods. |
Advertising Costs | (x) Advertising Costs Advertising costs are expensed as incurred. Advertising costs amounted to RMB35,300, RMB18,822 and RMB19,935 for the years ended December 31, 2021, 2022 and 2023, respectively. |
Leases | (y) Leases The Group leases office space, vehicles and certain equipment under operating leases for terms ranging from short term (under 12 months) to 7 years. The Group does not have options to extend or terminate leases, as the renewal or termination of relevant lease is on negotiation basis. As a lessee, the Group does not have any financing leases and none of the leases contain material residual value guarantees or material restrictive covenants. The Group’s office space leases typically have initial lease terms of 2 to 7 years, and vehicles and equipment leases typically have an initial term of 12 months or less. The Group’s office space leases include fixed rental payments. The lease payments for the Group’s office space leases do not consist of variable lease payments that depend on an index or a rate. The Group determines whether a contract contains a lease at contract inception. A contract contains a lease if there is an identified asset and the Group has the right to control the use of the identified asset. At the commencement of each lease, management determines its classification as an operating or finance lease. For leases that qualify as operating leases, the Group recognizes a right-of-use (“ROU”) asset and a lease liability based on the present value of the lease payments over the lease term in the consolidated statements of balance sheets at commencement date. As all of the leases do not have implicit rates available, the Group uses incremental borrowing rates based on the information available at lease commencement date in determining the present value of future payments. The incremental borrowing rates are estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased assets are located. The ROU asset is measured at the amount of the lease liabilities with adjustments, if applicable, for lease prepayments made prior to or at lease commencement, initial direct costs incurred and lease incentives. For office space leases, the Group identifies the lease and non-lease components (e.g., common-area maintenance costs) and accounts for non-lease components separately from lease component. The Group’s office space lease contracts have only one separate lease component and have no non-components (e.g., property tax or insurance). Most of the office space lease contracts have no non-lease components. For the office space lease contracts include non-lease components, the fixed lease payment is typically itemized in the office space lease contract for separate lease component and non-lease components. Therefore, the Group does not allocate the consideration in the contract to the separate lease component and the non-lease components. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Group has made an accounting policy election to exempt leases with an initial term of 12 months or less without a purchase option that is likely to be exercised from being recognized on the balance sheet. Payments related to those leases continue to be recognized in the consolidated statement of income and comprehensive income on a straight-line basis over the lease term. In addition, the Group does not have any related-party leases or sublease transactions. |
Accumulated Other Comprehensive Income | (z) Accumulated Other Comprehensive Income The Group presents comprehensive income in the consolidated statements of income and comprehensive income with net income in a continuous statement. Accumulated other comprehensive income mainly represents foreign currency translation adjustments and changes in fair value of short term investments for the period. |
Government grants | (aa) Government grants Government grants primarily consist of financial subsidies received from provincial and local governments for operating a business in their jurisdictions and compliance with specific policies promoted by the local governments. The Group records such government subsidies as other income or reduction of expenses or cost of revenues when it has fulfilled all of its obligation related to the subsidy. The Group recognized RMB17,448, RMB10,396 and RMB6,009 in the year ended December 31, 2021, 2022 and 2023. |
Recently accounting pronouncements issued not yet adopted | (ab) Recently accounting pronouncements issued not yet adopted In October 2023, the FASB issued ASU 2023-06, “ Codification Amendments in Response to the United States Securities and Exchange Commission (“SEC)’s Disclosure Update and Simplification Initiative Segment Reporting (Topic 280) – Segment Reporting (Topic 280)- Improvements to Reportable Segment Disclosures (“ASU 2023-07”), Income Taxes (Topic 740) – Income Taxes (Topic 740) - Improvements to Income Tax Disclosures |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Summary of Significant Accounting Policies [Abstract] | |
Schedule of Accounts Receivable and Contract Assets, Net | Accounts receivable and contract assets, net is analyzed as follows: As of December 31, 2022 2023 RMB RMB Accounts receivable 408,961 295,562 Contract assets (See Note 2(q)) 659,788 1,071,064 Allowance for doubtful accounts (15,361 ) (15,784 ) Accounts receivable and contract assets, net 1,053,388 1,350,842 |
Schedule of Group’s Allowance for Expected Credit Losses of Accounts Receivables | The following table summarizes the movement of the Group’s allowance for expected credit losses of accounts receivable and contract assets: 2021 2022 2023 RMB RMB RMB Balance at the beginning of the year 29,000 28,025 15,361 Current period provision for (reversal of) expected credit losses 2,095 (1,378 ) 4,036 Write-offs (3,070 ) (11,286 ) (3,613 ) Balance at the end of the year 28,025 15,361 15,784 |
Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method | Property, plant and equipment are stated at cost. Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives, taking into account residual value: Estimated Estimated Building 20-36 0% Office equipment, furniture and fixtures 3-5 0%-3% Motor vehicles 5-10 0%-3% Leasehold improvements 5 0% |
Schedule of Depreciation Expense Recognized in the Consolidated Statements of Income and Comprehensive Income | The depreciation methods and estimated useful lives are reviewed regularly. The following table summarizes the depreciation expense recognized in the consolidated statements of income and comprehensive income: 2021 2022 2023 RMB RMB RMB Operating costs 791 822 576 Selling expenses 5,778 5,106 4,368 General and administrative expenses 11,773 13,545 11,248 Depreciation expense 18,342 19,473 16,192 |
Schedule of Intangible Assets Estimated Useful Lives | The estimated useful lives for the Group’s intangible assets are as follows: Estimated useful life (Years) Software 3 Non-compete agreements 5.8 - 6 Agent resources 2.8 - 3 Brokerage license 20 |
Schedule of Intial Recognization | As of December 31, 2022 and 2023, information about inputs into the fair value measurements of the Group’s assets and liabilities that are measured at fair value on a recurring basis in periods subsequent to their initial recognition is as follows. Fair Value Measurements Description As of Quoted Significant Significant RMB RMB RMB RMB Short-term investments - debt security 331,228 — 331,228 — Fair Value Measurements Description As of Quoted Significant Significant RMB RMB RMB RMB Short-term investments - debt security 925,678 — 925,678 — Investments – equity security recorded within other current assets 96,343 96,343 — — Contingent consideration 13,461 — — 13,461 |
Acquisitions and Disposals (Tab
Acquisitions and Disposals (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Acquisitions and Disposals [Abstract] | |
Schedule of Purchase Price to the Assets Acquired and Liabilities Assumed | The following is a summary of the fair value of the purchase price and the final allocation of the purchase price to the assets acquired and liabilities assumed: RMB Consideration transferred Stock consideration 153,732 Contingent consideration (7,162 ) Total 146,570 Add: Non-controlling interest 107,318 253,888 RMB Assets acquired Cash and cash equivalents and restricted cash 17,174 Intangible assets acquired 61,472 - software 5,900 - Non-compete agreements 8,423 - Agent resources 28,749 - Insurance broker license 18,400 Accounts receivable and contract assets 163,396 Other assets 16,651 Total assets acquired 258,693 Liabilities Assumed Accounts payable and accrued commissions (173,194 ) Deferred tax liabilities (16,651 ) Other payables and accrued expenses (12,167 ) Other liabilities (9,477 ) Total liabilities assumed (211,489 ) Net assets acquired 47,204 Goodwill 206,684 The following is a summary of the fair value of the purchase price and the final allocation of the purchase price to the assets acquired and liabilities assumed: RMB Consideration transferred Stock consideration 35,311 Contingent consideration 74 Total 35,385 Add: Non-controlling interest 33,998 69,383 RMB Assets acquired Cash and cash equivalents and restricted cash 1,226 Intangible assets acquired 10,930 - Non-compete agreements 1,350 - Agent resources 7,180 - Insurance distribution license 2,400 Accounts receivable and contract assets, net 7,188 Other assets 2,602 Total assets acquired 21,946 Liabilities Assumed Accounts payable and accrued commissions (1,922 ) Deferred tax liabilities (2,732 ) Other payables and accrued expenses (3,777 ) Other liabilities (1,600 ) Total liabilities assumed (10,031 ) Net assets acquired 11,915 Goodwill 57,468 |
Schedule of Fair Value of Assets Acquired and Liabilities Assumed | The consideration, fair value of assets acquired and liabilities assumed, as well as goodwill resulted from the acquisition are as follows: RMB Consideration: Cash 31,390 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash and cash equivalents 9,819 Short term investments 5,360 Accounts receivables 401 Other receivable and current assets 33,192 Property and equipment 11 Right of use assets 521 Total assets acquired 49,304 Accounts payables (4,532 ) Accrued expenses and other current liabilities (13,045 ) Lease liability (465 ) Total liabilities assumed (18,042 ) Net assets acquired 31,262 Goodwill 128 |
Other Receivables, Net (Tables)
Other Receivables, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Receivables, Net [Abstract] | |
Schedule of Other Receivable Net | Other receivables, net consist of the following: As of December 31, 2022 2023 RMB RMB Advances to staff (i) 11,397 12,748 Advances to entrepreneurial agents (i) 81 — Advances to a third party channel vendor (ii) 22,818 27,386 Rental deposits 19,535 11,820 Amount due from third parties (iii) 183,353 83,156 Other 4,841 7,058 Less: Allowance for current expected credit losses (10,976 ) (30,414 ) Other receivables, net 231,049 111,754 (i) Amounts represented advances to staffs or entrepreneurial agents of the Group for daily business operations, which are unsecured, interest-free and repayable on demand. (ii) Amount represented receivables from Shenzhen Chetong Technology Co., Ltd. (“Chetong”) who provides platform services to the Group. The receivables were unsecured, interest-free and repayable on demand. With the cease of cooperation with Chetong in 2022, the Group requested repayment of the advances. The Group estimated the net amount expected to be collected was RMB14,736 and nil (iii) Amount mainly represented 1) term-loan (matures in June 2024 with extension) to Sichuan Tianyi Real Estate Development Co., Ltd. (“Sichuan Tianyi”) of RMB40,000 and corresponding interest receivable RMB607 as of December 31, 2023. The loan is guaranteed by the ultimate controlling owner of Sichuan Tianyi, whom is jointly liable, with interest rate 6% per annum. This loan receivable is expected to be settled within one year. 2) term-loan (matures in June 2024) to a third party company principally engaged in provision of education service of RMB20,000 as of December 31, 2023, with the interest rate 5% per annum. 3) term-loan (matures in December 2024) to a third party manufacturing company of RMB21,000 as of December 31, 2023, with the interest rate 5% per annum. |
Property, Plant and Equipment_2
Property, Plant and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment, Net | Property, plant and equipment, net, is comprised of the following: As of December 31, 2022 2023 RMB RMB Building 12,317 15,572 Office equipment, furniture and fixtures 162,573 165,802 Motor vehicles 18,641 19,206 Leasehold improvements 39,993 34,969 Total 233,524 235,549 Less: Accumulated depreciation (191,945 ) (197,530 ) Construction in progress 56,880 53,640 98,459 91,659 |
Other Current Assets, Net (Tabl
Other Current Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Current Assets, Net [Abstract] | |
Schedule of Current Assets | Other current assets consist of the following: As of December 31, 2022 2023 RMB RMB Prepayment for acquisition of short-term investments 390,000 — Prepaid operating costs 12,594 7,828 Prepaid miscellaneous daily expenses 16,146 12,974 Equity investments with readily determinable fair value 126 96,343 Other 2,664 4,186 Less: Allowance for current expected credit losses (1,795 ) — 419,735 121,331 |
Goodwill, Net (Tables)
Goodwill, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill [Abstract] | |
Schedule of Gross Amount and Accumulated Impairment Losses | The gross amount of goodwill and accumulated impairment losses by reporting unit as of December 31, 2022 and 2023 are as follows: Agency Claims Total RMB RMB RMB Gross as of December 31, 2022 132,105 21,137 153,242 Addition in 2023 (Note 3) 297,413 — 297,413 Disposal in 2023 (Note 3) (33,261 ) — (33,261 ) Accumulated impairment loss as of December 31, 2022 and 2023 (22,108 ) (21,137 ) (43,245 ) Net as of December 31, 2022 109,997 — 109,997 Net as of December 31, 2023 374,149 — 374,149 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Intangible Assets, Net [Abstract] | |
Schedule of Intangible Assets | Intangible assets, net, are comprised of the following: As of December 31, 2022 2023 RMB RMB Software — 5,900 Non-compete agreements — 9,773 Agent resources — 35,929 Brokerage license — 23,018 Total — 74,620 Less: Accumulated amortization — (16,304 ) — 58,316 |
Investments in Affiliates (Tabl
Investments in Affiliates (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Investments in Affiliates [Abstract] | |
Schedule of Equity Method Investments | As of December 31, 2022 and 2023, the Group’s investments accounted for under the equity method were as follows: As of December 31, 2022 2023 RMB RMB CNFinance — — Others 4,035 — Total 4,035 — |
Other Non-Current Assets (Table
Other Non-Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Non-Current Assets [Abstract] | |
Schedule of Other Non Current Assets | Other non-current assets consist of the following: As of December 31, 2022 2023 RMB RMB Equity investments without readily determinable fair value (Note 2(j)) 11,400 31,892 Long-term hybrid instrument (Note 2(j)) — 125,000 Amount due from a third party (i) — 30,359 Contingent considerations (Note 3) — 13,461 Receivables from certain shareholders as guarantee deposit due to business combinations — 33,373 Others — 4,597 Less: Allowance for current expected credit losses — (2,930 ) 11,400 235,752 (i) Amount represented a term-loan (matures in September 2028) to a third party of RMB30,000 and corresponding interest receivable RMB359 as of December 31, 2023. The loan bears interest rate 4.5% per annum and is guaranteed by the ultimate controlling owner of the borrower, whom is jointly liable. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Schedule of Rou Assets and Related Lease Liabilities | The following represents the aggregate ROU assets and related lease liabilities as of December 31, 2022 and 2023: As of December 31, 2022 2023 RMB RMB Operating lease ROU assets 145,086 136,056 Current operating lease liability 62,304 57,164 Non-current operating lease liability 74,190 71,311 Total operating leased liabilities 136,494 128,475 |
Schedule of Weighted Average Lease Term and Weighted Average Discount Rate | The weighted average lease term and discount rate as of December 31, 2022 and 2023 were as follows: As of December 31, 2022 2023 Weighted average lease term: Operating leases 2.83 2.83 Weighted average discount rate: Operating leases 4.28 % 3.89 % |
Schedule of Lease Expenses | The components of lease expenses for the years ended December 31, 2022 and 2023 were as follows: As of December 31, 2022 2023 RMB RMB Operating lease expense 97,576 74,819 Short term lease expense 1,227 7,748 Total 98,803 82,567 |
Schedule of Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases for the years ended December 31, 2022 and 2023 were as follows: As of December 31, 2022 2023 RMB RMB Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases 90,438 72,223 Supplemental noncash information: Right-of-use assets obtained in exchange for lease obligations net of decrease in right-of-use assets for early determinations 4,462 57,233 |
Schedule of Maturities of Lease Liabilities | Maturities of lease liabilities at December 31, 2023: Minimum RMB Year ending December 31: 2024 58,924 2025 43,048 2026 23,747 2027 5,941 2028 2,423 Thereafter 1,351 Total remaining undiscounted lease payments 135,434 Less: Interest 6,959 Total present value of lease liabilities 128,475 Less: Current operating lease liability 57,164 Non-current operating lease liability 71,311 |
Variable Interest Entities (__2
Variable Interest Entities (“VIEs”) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Variable Interest Entities (“VIEs”) [Abstract] | |
Schedule of Variable Interest Entities | Summarized below is the information related to VIEs, including total assets, total current liabilities, total liabilities, net revenues, total operating costs and expenses, net income (loss) and cash flows after intercompany elimination are as follows: As of December 31, 2022 2023 RMB RMB Total assets 102,965 139,541 Total current liabilities (50,457 ) (39,996 ) Total liabilities (77,990 ) (68,430 ) Year Ended December 31, 2021 2022 2023 RMB RMB RMB Net revenues 16,267 141,086 122,880 Operating costs and expenses 1,814 67,788 100,957 Net income (loss) 14,431 (4,136 ) (13,085 ) Net cash generated from operating activities 48,923 98,715 3,754 |
Other Payables and Accrued Ex_2
Other Payables and Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Payables and Accrued Expenses [Abstract] | |
Schedule of Other Payables and Accrued Expenses | Components of other payables and accrued expenses are as follows: As of December 31, 2022 2023 RMB RMB Business and other tax payables 77,502 89,715 Refundable deposits from employees and agents 19,789 18,239 Professional fees 3,586 5,609 Accrued expenses to third parties 29,861 33,382 Contributions from members of eHuzhu mutual aid program (Note 2(c)) 43,140 37,261 Others 448 1,793 Total 174,326 185,999 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Taxes [Abstract] | |
Schedule of Unrecognized Tax Benefits | The movements of unrecognized tax benefits are as follows: RMB Balance as of January 1, 2021 67,219 Change in unrecognized tax benefits — Increase in tax positions 5,994 Balance as of December 31, 2021 73,213 Change in unrecognized tax benefits — Decrease in tax positions (36,566 ) Balance as of December 31, 2022 36,647 Change in unrecognized tax benefits — Decrease in tax positions (2,279 ) Balance as of December 31, 2023 34,368 |
Schedule of Income Tax Expenses | Income tax expenses are comprised of the following: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Current tax expense 66,665 13,169 44,836 Deferred tax expense 23,909 27,847 14,566 Income tax expense 90,574 41,016 59,402 |
Schedule of Deferred Income Tax Assets and Liabilities | The principal components of the deferred income tax assets and liabilities are as follows: As of December 31, 2022 2023 RMB RMB Deferred tax assets: Operating loss carryforward 96,173 117,072 Intangible assets, net 2,856 5,003 Less: valuation allowances (78,627 ) (81,340 ) Total 20,402 40,735 Deferred tax liabilities: Fair value adjustments in relation to short-term investments 13,954 15,944 Estimated profit arising from future renewal commissions 59,271 91,428 PRC dividend withholding taxes 29,230 29,230 Identifiable intangible assets — 12,549 Total 102,455 149,151 |
Schedule of Effective Income Tax Rate Reconciliation | Reconciliation between the provision for income taxes computed by applying the PRC enterprise income rate of 25% to net income before income taxes and income of affiliates, and the actual provision for income taxes is as follows: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Income from continuing operations before income taxes, share of income of affiliates, net 371,088 196,335 349,818 PRC statutory tax rate 25 % 25 % 25 % Income tax at statutory tax rate 92,772 49,084 87,455 Expenses not deductible for tax purposes: —Entertainment 2,950 2,099 2,417 —Other 81 479 340 Effect of tax holidays on concessionary rates granted to PRC entities (13,523 ) (12,671 ) (9,956 ) Effect of different tax rates of subsidiaries operating in other jurisdictions 2,070 2,342 4,110 Change in valuation allowance 2,999 40,501 2,713 Deferred income tax for dividend distribution 10,349 — — Effect of non-taxable income* (13,777 ) (4,620 ) (25,709 ) Unrecognized tax benefits arising from certain transfer pricing arrangements 5,994 (36,566 ) (2,279 ) Other 659 368 311 Income tax expense 90,574 41,016 59,402 * The effect of non-taxable income for years ended December 31, 2021 and 2022 represents an income tax exemption according to the Notice (Cai Shui [2002] No. 128) promulgated by the State Administration of Taxation and Ministry of Finance in China on dividend income derived from a purchased open-end securities investment fund product that the Group recorded as short term investment. The effect of non-taxable income for the year ended December 31, 2023 is primarily relating to the non-taxable gains from changes in fair value of equity interests held by the Group. |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Net Income Per Share [Abstract] | |
Schedule of Basic and Diluted Net Income Per Ordinary Share | The computation of basic and diluted net income per ordinary share is as follows: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Basic: Net income 259,941 85,723 289,099 Less: Net income (loss) attributable to the noncontrolling interests 8,952 (14,549 ) 8,622 Net income attributable to the Company’s shareholders 250,989 100,272 280,477 Weighted average number of ordinary shares outstanding* 1,073,891,784 1,074,196,310 1,074,372,067 Basic net income per ordinary share 0.23 0.09 0.26 Basic net income per ADS 4.67 1.87 5.22 * The weighted average number of ordinary shares outstanding excludes the number of ordinary shares issued in business combinations occurred in 2023 through an exchange of equity interests that are treated in the same manner as contingently issuable shares because the holders must return all or part if all necessary conditions have not been satisfied by the end of the period. Year Ended December 31, 2021 2022 2023 RMB RMB RMB Diluted: Net income 259,941 85,723 289,099 Less: Net income (loss) attributable to the noncontrolling interests 8,952 (14,549 ) 8,622 Net income attributable to the Company’s shareholders 250,989 100,272 280,477 Weighted average number of ordinary shares outstanding 1,073,891,784 1,074,196,310 1,074,372,067 Weighted average number of dilutive potential ordinary shares from share options and restricted share units 399,410 261,511 2,368,131 Total 1,074,291,194 1,074,457,821 1,076,740,198 Diluted net income per ordinary share 0.23 0.09 0.26 Diluted net income per ADS 4.67 1.87 5.21 |
Concentrations of Credit Risk (
Concentrations of Credit Risk (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Concentrations of Credit Risk [Abstract] | |
Schedule of Concentration of Total Net Revenue | Customers accounting for 10% or more of total net revenues excluding estimated renewal commissions are as follows: Year ended December 31, 2021 % of 2022 % of 2023 % of RMB RMB RMB Sinatay Life Insurance Co., Ltd. (“Sinatay”) 451,840 15.0 % 497,143 19.6 % 438,026 15.3 % Aeon Life Insurance Co., Ltd. (“Aeon”). 437,132 14.5 % * * 295,217 10.3 % Huaxia Life Insurance Company Limited (“Huaxia”) 323,800 10.7 % * * * * Subtotal 1,212,772 40.2 % 497,143 19.6 % 733,243 25.6 % * represented less than 10% of total net revenues for the year. |
Schedule of Concentration of Accounts Receivable | Customers which accounted for 10% or more of gross accounts receivable excluding estimated renewal commissions are as follows: As of December 31, 2022 % 2023 % RMB RMB Sinatay 124,847 23.4 % 57,119 14.7 % Greatwall Life Insurance Co., Ltd 85,616 16.0 % 63,455 16.3 % Subtotal 210,463 39.4 % 120,574 31.0 % |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Compensation [Abstract] | |
Schedule of Share Options Outstanding | For the year ended December 31, 2023, changes in the status of total outstanding options, were as follows: Number of Weighted Weighted Aggregate Outstanding as of January 1, 2023 and December 31, 2023 4,000,000 0.2305 5.19 408 Number of Weighted Weighted Aggregate Outstanding as of January 1, 2023 — — — — Granted 13,680,000 0.0500 4.49 4,275 Exercised — — — — Forfeited (2,380,000 ) — — — Outstanding as of December 31, 2023 11,300,000 0.0500 3.59 3,192 |
Schedule of Activity of Service-Based RSUs | A summary of the activity of the service-based RSUs for the year ended December 31, 2023 is presented as follows: Number of restricted shares Weighted average fair value US$ Unvested as of January 1, 2023 — — Granted 536,990 3,410 vested — — Forfeited — — Unvested as of December 31, 2023 536,990 3,410 |
Schedule of Fair Value of the 2023 MDRT Options on the Grant | The assumptions used in determining the fair value of the 2023 MDRT Options on the grant date were as follows: Assumptions February 6, Expected dividend yield (Note i) 3.69% Risk-free interest rates (Note ii) 3.88% Expected volatility (Note iii) 51.41% Expected life in years (Note iv) 4.49 Exercise multiple (Note v) 2.80 Fair value of options on grant date US$0.2896 ~ US$0.2997 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table shows the Group’s operations by business segment for the years ended December 31, 2021, 2022 and 2023. Other represents revenue and expenses that are not allocated to reportable segments and corporate related items. Year ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ Net revenues Agency 2,811,936 2,376,851 2,760,448 388,801 Claims Adjusting 459,178 404,763 437,941 61,683 Total net revenues 3,271,114 2,781,614 3,198,389 450,484 Operating costs and expenses Agency (2,418,444 ) (2,068,194 ) (2,422,386 ) (341,187 ) Claims Adjusting (442,349 ) (416,619 ) (418,589 ) (58,958 ) Other (108,416 ) (128,126 ) (161,589 ) (22,758 ) Total operating costs and expenses (2,969,209 ) (2,612,939 ) (3,002,564 ) (422,903 ) Income (loss) from operations Agency 393,492 308,657 338,062 47,614 Claims Adjusting 16,829 (11,856 ) 19,352 2,725 Other (108,416 ) (128,126 ) (161,589 ) (22,758 ) Income from operations 301,905 168,675 195,825 27,581 |
Schedule of Segment Assets | As of December 31, 2022 2023 2023 RMB RMB US$ Segment assets Agency 1,513,449 2,515,467 354,296 Claims Adjusting 252,130 259,325 36,524 Other 1,323,937 1,276,092 179,735 Total assets 3,089,516 4,050,884 570,555 |
Schedule I_Condensed Financia_2
Schedule I—Condensed Financial Information of the Company (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Schedule I—Condensed Financial Information of the Company [Abstract] | |
Schedule of Balance Sheet | Balance Sheets As of December 31, 2022 2023 2023 RMB RMB US$ Note2(u) ASSETS: Current assets: Cash and cash equivalents 38,512 23,595 3,323 Short term investments 27,619 — — Other receivables and amounts due from subsidiaries and affiliates 417,613 450,933 63,513 Total current assets 483,744 474,528 66,836 Non-current assets: Investment in subsidiaries 2,520,667 3,010,729 424,052 Investment in an affiliate 4,035 — — Other non-current asset — 13,461 1,896 Total assets 3,008,446 3,498,718 492,784 LIABILITIES AND SHAREHOLDERS’ EQUITY: Current liabilities: Other payables and accrued expenses and amounts due to subsidiaries 1,385,043 1,427,456 201,053 Total liabilities 1,385,043 1,427,456 201,053 Ordinary shares (Authorized shares:10,000,000,000 at US$0.001 each; issued 1,074,291,784 and 1,158,913,224 shares, of which 1,072,842,484 and 1,134,236,184 shares were outstanding as of December 31, 2022 and 2023, respectively) 8,091 8,675 1,222 Treasury Stock (10 ) (178 ) (25 ) Additional paid-in capital 461 162,721 22,919 Retained earnings 1,647,504 1,927,981 271,550 Accumulated other comprehensive loss (32,643 ) (27,936 ) (3,935 ) Total equity 1,623,403 2,071,263 291,731 Total liabilities and shareholders’ equity 3,008,446 3,498,719 492,784 |
Schedule of Statements of Income and Comprehensive Income | Statements of Income and Comprehensive Income Year Ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ General and administrative expenses (331 ) (11,318 ) (11,018 ) (1,552 ) Selling expenses — — (13,627 ) (1,919 ) Interest income 2 5 1,201 169 Others, net — 17,495 17,009 2,395 Equity in earnings of subsidiaries and an affiliate 251,318 94,090 286,912 40,411 Net Income attributable to the Company’s shareholders 250,989 100,272 280,477 39,504 Other comprehensive income (loss): Foreign currency translation adjustments (9,116 ) 3,728 2,249 317 Unrealized net gains on available-for-sale investments 6,252 (1,919 ) 2,458 346 Share of other comprehensive (loss) gain of affiliates (1,281 ) 4,688 — — Comprehensive income attributable to the Company’s shareholders 246,844 106,769 285,184 40,167 |
Schedule of Statements of Cash Flows | Statements of Cash Flows Year Ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ Cash flow from operating activities: Net income 250,989 100,272 280,477 39,504 Adjustments to reconcile net income to net cash used in operating activities: Equity in earnings of subsidiaries and an affiliate (251,318 ) (94,090 ) (312,323 ) (43,990 ) Compensation expenses associated with stock options — 461 17,095 2,408 Other non-cash adjustments — — (22,569 ) (3,179 ) Changes in operating assets and liabilities: Other receivables 392 — (20 ) (3 ) Accrued payroll and Other payables (847 ) 696 820 116 Net cash (used in) from operating activities (784 ) 7,339 (36,520 ) (5,144 ) Cash flows (used in) generated from investing activities Changes in investment in subsidiaries and an affiliate 43,757 907,006 2,458 346 Advances to subsidiaries and affiliates 157,582 (689,780 ) (10,005 ) (1,409 ) Proceeds from disposal of short-term investments — 10,095 27,639 3,893 Net cash generated from investing activities 201,339 227,321 20,092 2,830 Cash flows generated from (used in) financing activities: Proceeds on exercise of stock options — 2 — — Dividends paid (242,518 ) (317,730 ) — — Repurchase of ordinary shares from open market — (3,984 ) (29,044 ) (4091 ) Net cash generated used in financing activities (242,518 ) (321,712 ) (29,044 ) (4,091 ) Net decrease in cash and cash equivalents (41,963 ) (87,052 ) (45,472 ) (6,405 ) Cash and cash equivalents and restricted cash at beginning of year 66,345 14,507 38,512 5,424 Effect of exchange rate changes on cash and cash equivalents (9,875 ) 111,057 30,555 4,304 Cash and cash equivalents and restricted cash at end of the year 14,507 38,512 23,595 3,323 |
Organization and Description _2
Organization and Description of Business (Details) | Dec. 27, 2023 shares |
Organization and Description of Business (Details) [Line Items] | |
Ordinary shares | 568,226,628 |
Highest Performances Holdings Inc. [Member] | |
Organization and Description of Business (Details) [Line Items] | |
Percentage of equity interests | 50.07% |
Highest Performances Holdings Inc. [Member] | |
Organization and Description of Business (Details) [Line Items] | |
Ordinary shares | 284,113,314 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) ¥ / shares in Units, ¥ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) ¥ / shares | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 $ / shares | |
Summary of Significant Accounting Policies [Line Items] | ||||
Insurance premium receivables | ¥ 14,986 | ¥ 15,847 | ||
Entrustment deposits | 38,252 | 44,110 | ||
Guarantee balance | 27,228 | 20,729 | ||
Impairment | ¥ 20,110 | |||
Debt security | ¥ 125,000 | |||
Fixed return rate | 6% | |||
Insurance policies | 0.10% | 0.10% | 0.10% | |
Recognized contingent performance bonus | ¥ 18,161 | ¥ 11,387 | ¥ 3,887 | |
Tax amount | 14,258 | 14,681 | 19,235 | |
Total value-added taxes, paid | 138,234 | 130,743 | 179,183 | |
Fair value of contingent consideration | 6,650 | |||
Aggregate amount | ¥ 557,585 | 600,901 | ||
Rate of US dollars (in Dollars per share) | $ / shares | $ 1 | |||
Rate of RMB (in Yuan Renminbi per share) | ¥ / shares | ¥ 7.0999 | |||
Advertising costs | ¥ 19,935 | 18,822 | 35,300 | |
Operating lease term | 7 years | |||
Recognized amount | ¥ 6,009 | ¥ 10,396 | ¥ 17,448 | |
Minimum [Member] | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Credit Loss Rate | 0.01% | |||
Operating lease term | 2 years | |||
Maximum [Member] | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Credit Loss Rate | 100% | |||
Operating lease term | 7 years |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Schedule of Accounts Receivable and Contract Assets, Net - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of accounts receivable and contract assets, net [Abstract] | ||
Accounts receivable | ¥ 295,562 | ¥ 408,961 |
Contract assets (See Note 2(q)) | 1,071,064 | 659,788 |
Allowance for doubtful accounts | (15,784) | (15,361) |
Accounts receivable and contract assets, net | ¥ 1,350,842 | ¥ 1,053,388 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) - Schedule of Group’s Allowance for Expected Credit Losses of Accounts Receivables - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of group’s allowance for expected credit losses of accounts receivables [Abstract] | |||
Balance at the beginning of the year | ¥ 15,361 | ¥ 28,025 | ¥ 29,000 |
Current period provision for (reversal of) expected credit losses | 4,036 | (1,378) | 2,095 |
Write-offs | (3,613) | (11,286) | (3,070) |
Balance at the end of the year | ¥ 15,784 | ¥ 15,361 | ¥ 28,025 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method | Dec. 31, 2023 |
Building [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated residual value | 0% |
Building [Member] | Minimum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated useful life (Years) | 20 years |
Building [Member] | Maximum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated useful life (Years) | 36 years |
Office equipment, furniture and fixtures [Member] | Minimum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated useful life (Years) | 3 years |
Estimated residual value | 0% |
Office equipment, furniture and fixtures [Member] | Maximum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated useful life (Years) | 5 years |
Estimated residual value | 3% |
Motor vehicles [Member] | Minimum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated useful life (Years) | 5 years |
Estimated residual value | 0% |
Motor vehicles [Member] | Maximum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated useful life (Years) | 10 years |
Estimated residual value | 3% |
Leasehold improvements [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Property Plant and Equipment Depreciation and Amortization are Calculated Using the Straight-line Method [Line Items] | |
Estimated useful life (Years) | 5 years |
Estimated residual value | 0% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details) - Schedule of Depreciation Expense Recognized in the Consolidated Statements of Income and Comprehensive Income - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Summary of Significant Accounting Policies (Details) - Schedule of Depreciation Expense Recognized in the Consolidated Statements of Income and Comprehensive Income [Line Items] | |||
Depreciation for the year | ¥ 16,192 | ¥ 19,473 | ¥ 18,342 |
Operating costs [Member] | |||
Summary of Significant Accounting Policies (Details) - Schedule of Depreciation Expense Recognized in the Consolidated Statements of Income and Comprehensive Income [Line Items] | |||
Depreciation for the year | 576 | 822 | 791 |
Selling expenses [Member] | |||
Summary of Significant Accounting Policies (Details) - Schedule of Depreciation Expense Recognized in the Consolidated Statements of Income and Comprehensive Income [Line Items] | |||
Depreciation for the year | 4,368 | 5,106 | 5,778 |
General and administrative expenses [Member] | |||
Summary of Significant Accounting Policies (Details) - Schedule of Depreciation Expense Recognized in the Consolidated Statements of Income and Comprehensive Income [Line Items] | |||
Depreciation for the year | ¥ 11,248 | ¥ 13,545 | ¥ 11,773 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Details) - Schedule of Intangible Assets Estimated Useful Lives | Dec. 31, 2023 |
Software [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Intangible Assets Estimated Useful Lives [Line Items] | |
Intangible assets | 3 years |
Non-compete agreements [Member] | Minimum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Intangible Assets Estimated Useful Lives [Line Items] | |
Intangible assets | 5 years 9 months 18 days |
Non-compete agreements [Member] | Maximum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Intangible Assets Estimated Useful Lives [Line Items] | |
Intangible assets | 6 years |
Agent resources [Member] | Minimum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Intangible Assets Estimated Useful Lives [Line Items] | |
Intangible assets | 2 years 9 months 18 days |
Agent resources [Member] | Maximum [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Intangible Assets Estimated Useful Lives [Line Items] | |
Intangible assets | 3 years |
Brokerage license [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of Intangible Assets Estimated Useful Lives [Line Items] | |
Intangible assets | 20 years |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies (Details) - Schedule of Intial Recognization - Fair Value, Recurring [Member] - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Summary of Significant Accounting Policies (Details) - Schedule of Intial Recognization [Line Items] | ||
Short-term investments - debt security | ¥ 925,678 | ¥ 331,228 |
Investments – equity security recorded within other current assets | 96,343 | |
Contingent consideration | 13,461 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Summary of Significant Accounting Policies (Details) - Schedule of Intial Recognization [Line Items] | ||
Short-term investments - debt security | ||
Investments – equity security recorded within other current assets | 96,343 | |
Contingent consideration | ||
Significant Other Observable Inputs (Level 2) [Member] | ||
Summary of Significant Accounting Policies (Details) - Schedule of Intial Recognization [Line Items] | ||
Short-term investments - debt security | 925,678 | 331,228 |
Investments – equity security recorded within other current assets | ||
Contingent consideration | ||
Significant Unobservable Inputs (Level 3) [Member] | ||
Summary of Significant Accounting Policies (Details) - Schedule of Intial Recognization [Line Items] | ||
Short-term investments - debt security | ||
Investments – equity security recorded within other current assets | ||
Contingent consideration | ¥ 13,461 |
Acquisitions and Disposals (Det
Acquisitions and Disposals (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||||||
Mar. 01, 2023 CNY (¥) shares | Feb. 08, 2023 | Feb. 06, 2023 CNY (¥) shares | Jan. 03, 2023 CNY (¥) shares | Dec. 31, 2023 CNY (¥) shares | Dec. 31, 2021 CNY (¥) | Nov. 30, 2023 HKD ($) | Aug. 31, 2022 CNY (¥) | |
Acquisitions and Disposals [Line Items] | ||||||||
Goodwill | ¥ 33,361 | |||||||
Cash consideration amount | $ 2,755 | ¥ 31,390 | ||||||
Percentage of fair value of gross assets | 90% | |||||||
Recognized gain | ¥ 2,051 | |||||||
Total consideration | 600 | |||||||
Group Disposed of Two Subsidiaries [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Disposals of subsidiaries total consideration | ¥ 3,600 | |||||||
Zhongrong Smart Finance Information Technology Co Ltd (“Zhongrong”) [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Equity interest percentage | 57.73% | |||||||
Stock consideration | ¥ 153,732 | |||||||
Contingent asset | ¥ 7,162 | |||||||
Lock-up period | 3 years | |||||||
Zhongrong Smart Finance Information Technology Co Ltd (“Zhongrong”) [Member] | Common Stock [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Number of shares issued (in Shares) | shares | 61,853,580 | |||||||
Wuhan Taiping Online Insurance Agency Co., Ltd. [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Equity interest percentage | 51% | |||||||
Stock consideration | ¥ 23,541 | |||||||
Contingent asset | ¥ 1,554 | |||||||
Lock-up period | 3 years | |||||||
Purchase price | ¥ 21,987 | |||||||
Intangible assets | ¥ 10,420 | |||||||
Ordinary shares (in Shares) | shares | 9,107,140 | |||||||
Disposal gain | ¥ 139 | |||||||
Wuhan Taiping Online Insurance Agency Co., Ltd. [Member] | Common Stock [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Number of shares issued (in Shares) | shares | 9,107,140 | |||||||
Jilin Zhongji Shi’An Insurance Agency Co., Ltd. [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Equity interest percentage | 51% | |||||||
Stock consideration | ¥ 35,311 | |||||||
Lock-up period | 3 years | |||||||
Net contingent liability | ¥ 74 | |||||||
Jilin Zhongji Shi’An Insurance Agency Co., Ltd. [Member] | Common Stock [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Number of shares issued (in Shares) | shares | 13,660,720 | |||||||
Aasure Insurance Broker Limited [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Equity interest percentage | 100% | |||||||
Other Acquisitions [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Equity interest percentage | 100% | |||||||
Acquisition of an agency intermediate company [Member] | ||||||||
Acquisitions and Disposals [Line Items] | ||||||||
Equity interest percentage | 100% |
Acquisitions and Disposals (D_2
Acquisitions and Disposals (Details) - Schedule of Purchase Price to the Assets Acquired and Liabilities Assumed ¥ in Thousands | 12 Months Ended |
Dec. 31, 2023 CNY (¥) | |
Acquisition of Zhongrong Smart Finance Information Technology Co Ltd [Member] | |
Consideration transferred | |
Stock consideration | ¥ 153,732 |
Contingent consideration | (7,162) |
Total | 146,570 |
Add: Non-controlling interest | 107,318 |
Consideration transferred, total | 253,888 |
Assets acquired | |
Cash and cash equivalents and restricted cash | 17,174 |
Intangible assets acquired | 61,472 |
Other assets | 16,651 |
Total assets acquired | 258,693 |
Liabilities Assumed | |
Accounts payable and accrued commissions | (173,194) |
Deferred tax liabilities | (16,651) |
Other payables and accrued expenses | (12,167) |
Other liabilities | (9,477) |
Total liabilities assumed | (211,489) |
Net assets acquired | 47,204 |
Goodwill | 206,684 |
Acquisition of Zhongrong Smart Finance Information Technology Co Ltd [Member] | Software [Member] | |
Assets acquired | |
Intangible assets acquired | 5,900 |
Acquisition of Zhongrong Smart Finance Information Technology Co Ltd [Member] | Non compete agreements [Member] | |
Assets acquired | |
Intangible assets acquired | 8,423 |
Acquisition of Zhongrong Smart Finance Information Technology Co Ltd [Member] | Agent resources [Member] | |
Assets acquired | |
Intangible assets acquired | 28,749 |
Acquisition of Zhongrong Smart Finance Information Technology Co Ltd [Member] | Insurance broker license [Member] | |
Assets acquired | |
Intangible assets acquired | 18,400 |
Accounts receivable and contract assets | 163,396 |
Acquisition of Jilin Zhongji Shi’An Insurance Agency Co Ltd [Member] | |
Consideration transferred | |
Stock consideration | 35,311 |
Contingent consideration | 74 |
Total | 35,385 |
Add: Non-controlling interest | 33,998 |
Consideration transferred, total | 69,383 |
Assets acquired | |
Cash and cash equivalents and restricted cash | 1,226 |
Intangible assets acquired | 10,930 |
Other assets | 2,602 |
Total assets acquired | 21,946 |
Liabilities Assumed | |
Accounts payable and accrued commissions | (1,922) |
Deferred tax liabilities | (2,732) |
Other payables and accrued expenses | (3,777) |
Other liabilities | (1,600) |
Total liabilities assumed | (10,031) |
Net assets acquired | 11,915 |
Goodwill | 57,468 |
Acquisition of Jilin Zhongji Shi’An Insurance Agency Co Ltd [Member] | Non compete agreements [Member] | |
Assets acquired | |
Intangible assets acquired | 1,350 |
Acquisition of Jilin Zhongji Shi’An Insurance Agency Co Ltd [Member] | Agent resources [Member] | |
Assets acquired | |
Intangible assets acquired | 7,180 |
Acquisition of Jilin Zhongji Shi’An Insurance Agency Co Ltd [Member] | Insurance distribution license [Member] | |
Assets acquired | |
Intangible assets acquired | 2,400 |
Accounts receivable and contract assets | ¥ 7,188 |
Acquisitions and Disposals (D_3
Acquisitions and Disposals (Details) - Schedule of Fair Value of Assets Acquired and Liabilities Assumed ¥ in Thousands | 12 Months Ended |
Dec. 31, 2022 CNY (¥) | |
Consideration: | |
Cash | ¥ 31,390 |
Recognized amounts of identifiable assets acquired and liabilities assumed: | |
Cash and cash equivalents | 9,819 |
Short term investments | 5,360 |
Accounts receivables | 401 |
Other receivable and current assets | 33,192 |
Property and equipment | 11 |
Right of use assets | 521 |
Total assets acquired | 49,304 |
Accounts payables | (4,532) |
Accrued expenses and other current liabilities | (13,045) |
Lease liability | (465) |
Total liabilities assumed | (18,042) |
Net assets acquired | 31,262 |
Goodwill | ¥ 128 |
Other Receivables, Net (Details
Other Receivables, Net (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 USD ($) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | |
Other Receivables, Net [Line Items] | ||||
Allowance for credit losses | $ 27,386 | ¥ 8,082 | ||
Corresponding interest receivable | ¥ | ¥ 607 | |||
Education fee | $ | $ 20,000 | |||
Third party Interest rate | 6% | 6% | ||
Manufacturing cost | $ | $ 21,000 | |||
Sichuan Tianyi Real Estate Development Co Ltd [Member] | ||||
Other Receivables, Net [Line Items] | ||||
Interest rate | 6% | |||
Shenzhen Chetong Technology Co Ltd [Member] | ||||
Other Receivables, Net [Line Items] | ||||
Loan receivable | ¥ 14,736 | |||
Sichuan Tianyi Real Estate Development Co Ltd [Member] | ||||
Other Receivables, Net [Line Items] | ||||
Loan receivable | ¥ | ¥ 40,000 | |||
Third party Interest rate | 5% | 5% | ||
Third Party [Member] | ||||
Other Receivables, Net [Line Items] | ||||
Third party Interest rate | 5% | 5% |
Other Receivables, Net (Detai_2
Other Receivables, Net (Details) - Schedule of Other Receivable Net - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of other receivables, net [Abstract] | |||
Advances to staff | [1] | ¥ 12,748 | ¥ 11,397 |
Advances to entrepreneurial agents | [1] | 81 | |
Advances to a third party channel vendor | [2] | 27,386 | 22,818 |
Rental deposits | 11,820 | 19,535 | |
Amount due from third parties | [3] | 83,156 | 183,353 |
Other | 7,058 | 4,841 | |
Less: Allowance for current expected credit losses | (30,414) | (10,976) | |
Other receivables, net | ¥ 111,754 | ¥ 231,049 | |
[1] Amounts represented advances to staffs or entrepreneurial agents of the Group for daily business operations, which are unsecured, interest-free and repayable on demand. Amount represented receivables from Shenzhen Chetong Technology Co., Ltd. (“Chetong”) who provides platform services to the Group. The receivables were unsecured, interest-free and repayable on demand. With the cease of cooperation with Chetong in 2022, the Group requested repayment of the advances. The Group estimated the net amount expected to be collected was RMB14,736 and nil |
Property, Plant and Equipment_3
Property, Plant and Equipment, Net (Details) - Schedule of Property, Plant and Equipment, Net ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Property, Plant and Equipment [Line Items] | |||
Total | ¥ 235,549 | ¥ 233,524 | |
Less: Accumulated depreciation | (197,530) | (191,945) | |
Construction in progress | 53,640 | 56,880 | |
Property, plant and equipment, net | 91,659 | $ 12,910 | 98,459 |
Building [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total | 15,572 | 12,317 | |
Office equipment, furniture and fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total | 165,802 | 162,573 | |
Motor vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total | 19,206 | 18,641 | |
Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total | ¥ 34,969 | ¥ 39,993 |
Other Current Assets, Net (Deta
Other Current Assets, Net (Details) - Schedule of Current Assets - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Current Assets [Abstract] | ||
Prepayment for acquisition of short-term investments | ¥ 390,000 | |
Prepaid operating costs | 7,828 | 12,594 |
Prepaid miscellaneous daily expenses | 12,974 | 16,146 |
Equity investments with readily determinable fair value | 96,343 | 126 |
Other | 4,186 | 2,664 |
Less: Allowance for current expected credit losses | (1,795) | |
Total | ¥ 121,331 | ¥ 419,735 |
Goodwill, Net (Details) - Sched
Goodwill, Net (Details) - Schedule of Gross Amount and Accumulated Impairment Losses - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2023 | |
Goodwill, Net (Details) - Schedule of Gross Amount and Accumulated Impairment Losses [Line Items] | |||
Gross as of December 31, 2022 | ¥ 153,242 | ||
Addition in 2023 (Note 3) | ¥ 297,413 | ||
Disposal in 2023 (Note 3) | (33,261) | ||
Accumulated impairment loss as of December 31, 2022 and 2023 | (43,245) | (43,245) | |
Net as of December 31, 2022 | 109,997 | 109,997 | ¥ 374,149 |
Agency Segment [Member] | |||
Goodwill, Net (Details) - Schedule of Gross Amount and Accumulated Impairment Losses [Line Items] | |||
Gross as of December 31, 2022 | 132,105 | ||
Addition in 2023 (Note 3) | 297,413 | ||
Disposal in 2023 (Note 3) | (33,261) | ||
Accumulated impairment loss as of December 31, 2022 and 2023 | (22,108) | (22,108) | |
Net as of December 31, 2022 | 109,997 | 109,997 | 374,149 |
Claims Adjusting Segment [Member] | |||
Goodwill, Net (Details) - Schedule of Gross Amount and Accumulated Impairment Losses [Line Items] | |||
Gross as of December 31, 2022 | 21,137 | ||
Addition in 2023 (Note 3) | |||
Disposal in 2023 (Note 3) | |||
Accumulated impairment loss as of December 31, 2022 and 2023 | (21,137) | (21,137) | |
Net as of December 31, 2022 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |||||||
Dec. 31, 2028 | Dec. 31, 2027 | Dec. 31, 2026 | Dec. 31, 2025 | Dec. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Intangible Assets, Net [Line Items] | ||||||||
Intangible assets | ¥ 85,040 | |||||||
Disposal of intangible assets | 8,866 | |||||||
Amortization expenses | ¥ 17,858 | ¥ 44 | ||||||
Forecast [Member] | ||||||||
Intangible Assets, Net [Line Items] | ||||||||
Amortization expenses | ¥ 2,780 | ¥ 2,788 | ¥ 2,788 | ¥ 16,816 | ¥ 16,901 |
Intangible Assets, Net (Detai_2
Intangible Assets, Net (Details) - Schedule of Intangible Assets - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | ¥ 74,620 | |
Less: Accumulated amortization | (16,304) | |
Intangible assets, net | 58,316 | |
Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 5,900 | |
Noncompete Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 9,773 | |
Agent resources [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 35,929 | |
Brokerage license [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | ¥ 23,018 |
Investments in Affiliates (Deta
Investments in Affiliates (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||||||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 22, 2023 | Aug. 31, 2023 CNY (¥) | Jun. 28, 2022 shares | Dec. 31, 2018 | |
Investments in Affiliates [Line Items] | ||||||||
Ordinary shares (in Shares) | shares | 252,995,600 | |||||||
Aggregate consideration equity interests | 4.46% | 4.46% | ||||||
Cash (in Yuan Renminbi) | ¥ 11,513 | |||||||
Investee losses (in Yuan Renminbi) | ¥ (1,317) | $ (185) | ¥ (69,596) | ¥ (20,573) | ||||
CN Finance [Member] | ||||||||
Investments in Affiliates [Line Items] | ||||||||
Other-than temporarily impairment amount (in Yuan Renminbi) | ¥ 78,277 | ¥ 29,316 | ||||||
Cash (in Yuan Renminbi) | 10,463 | |||||||
Investee losses (in Yuan Renminbi) | ||||||||
CN Finance [Member] | ||||||||
Investments in Affiliates [Line Items] | ||||||||
Equity interest, percentage | 18.50% | |||||||
CN Finance [Member] | Maximum [Member] | ||||||||
Investments in Affiliates [Line Items] | ||||||||
Equity interest, percentage | 18.50% | |||||||
CN Finance [Member] | Minimum [Member] | ||||||||
Investments in Affiliates [Line Items] | ||||||||
Equity interest, percentage | 0.01% | |||||||
HPH [Member] | ||||||||
Investments in Affiliates [Line Items] | ||||||||
Equity interest, percentage | 4.46% | 4.46% | 4.46% | |||||
Puyi Fund [Member] | ||||||||
Investments in Affiliates [Line Items] | ||||||||
Equity interest, percentage | 15.41% |
Investments in Affiliates (De_2
Investments in Affiliates (Details) - Schedule of Equity Method Investments - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Total investments | ¥ 4,035 | |
CNFinance [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Total investments | ||
Others [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Total investments | ¥ 4,035 |
Other Non-Current Assets (Detai
Other Non-Current Assets (Details) ¥ in Thousands | 12 Months Ended |
Dec. 31, 2023 CNY (¥) | |
Other Non-Current Assets [Line Items] | |
Third party loans | ¥ 30,000 |
Interest receivable | ¥ 359 |
Interest rate | 4.50% |
Third Party [Member] | |
Other Non-Current Assets [Line Items] | |
Term-loan matures | 2028 |
Other Non-Current Assets (Det_2
Other Non-Current Assets (Details) - Schedule of Other Non Current Assets - Other Noncurrent Assets [Member] - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | |
Other Non-Current Assets (Details) - Schedule of Other Non Current Assets [Line Items] | |||
Equity investments without readily determinable fair value | ¥ 31,892 | ¥ 11,400 | |
Long-term hybrid instrument | 125,000 | ||
Amount due from a third party | [1] | 30,359 | |
Contingent considerations | 13,461 | ||
Receivables from certain shareholders as guarantee deposit due to business combinations | 33,373 | ||
Others | 4,597 | ||
Less: Allowance for current expected credit losses | (2,930) | ||
Other non-current assets | ¥ 235,752 | ¥ 11,400 | |
[1] Amount represented a term-loan (matures in September 2028) to a third party of RMB30,000 and corresponding interest receivable RMB359 as of December 31, 2023. The loan bears interest rate 4.5% per annum and is guaranteed by the ultimate controlling owner of the borrower, whom is jointly liable. |
Leases (Details) - Schedule of
Leases (Details) - Schedule of Rou Assets and Related Lease Liabilities ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Schedule of Rou Assets and Related Lease Liabilities [Abstract] | |||
Operating lease ROU assets | ¥ 136,056 | $ 19,163 | ¥ 145,086 |
Current operating lease liability | 57,164 | 8,051 | 62,304 |
Non-current operating lease liability | 71,311 | $ 10,044 | 74,190 |
Total operating leased liabilities | ¥ 128,475 | ¥ 136,494 |
Leases (Details) - Schedule o_2
Leases (Details) - Schedule of Weighted Average Lease Term and Weighted Average Discount Rate | Dec. 31, 2023 | Dec. 31, 2022 |
Weighted average lease term: | ||
Weighted average lease term Operating leases | 2 years 9 months 29 days | 2 years 9 months 29 days |
Weighted average discount rate: | ||
Weighted average discount rate Operating leases | 3.89% | 4.28% |
Leases (Details) - Schedule o_3
Leases (Details) - Schedule of Lease Expenses - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Lease Expenses [Abstract] | ||
Operating lease expense | ¥ 74,819 | ¥ 97,576 |
Short term lease expense | 7,748 | 1,227 |
Total | ¥ 82,567 | ¥ 98,803 |
Leases (Details) - Schedule o_4
Leases (Details) - Schedule of Supplemental Cash Flow Information Related to Leases ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows for operating leases | ¥ 72,223 | ¥ 90,438 | ||
Supplemental noncash information: | ||||
Right-of-use assets obtained in exchange for lease obligations net of decrease in right-of-use assets for early determinations | ¥ 57,233 | $ 8,061 | ¥ 4,462 | ¥ 125,487 |
Leases (Details) - Schedule o_5
Leases (Details) - Schedule of Maturities of Lease Liabilities ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Schedule of Maturities of Lease Liabilities [Abstract] | |||
2024 | ¥ 58,924 | ||
2025 | 43,048 | ||
2026 | 23,747 | ||
2027 | 5,941 | ||
2028 | 2,423 | ||
Thereafter | 1,351 | ||
Total remaining undiscounted lease payments | 135,434 | ||
Less: Interest | 6,959 | ||
Total present value of lease liabilities | 128,475 | ¥ 136,494 | |
Less: Current operating lease liability | 57,164 | $ 8,051 | 62,304 |
Non-current operating lease liability | ¥ 71,311 | $ 10,044 | ¥ 74,190 |
Variable Interest Entities (__3
Variable Interest Entities (“VIEs”) (Details) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2021 | |
Variable Interest Entities (“VIEs”) [Line Items] | ||
Reduced percentage | 49% | |
Foreign-invested enterprise equity interests | 50% | |
Loan agreement | 10 years | |
Power of attorney | 10 years | |
Mutual agreement | 1 year | |
Aggregate revenues | In the year ended December 31, 2023, aggregate revenues derived from these VIEs contributed 3.8% of the total consolidated net revenues, based on the corporate structure as of the end of 2023. As of December 31, 2023, the VIEs accounted for an aggregate of 3.2% of the consolidated total assets. | |
Xinbao Investment [Member] | ||
Variable Interest Entities (“VIEs”) [Line Items] | ||
Equity interests | 51% |
Variable Interest Entities (__4
Variable Interest Entities (“VIEs”) (Details) - Schedule of Variable Interest Entities - VIE [Member] - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Variable Interest Entity [Line Items] | |||
Total assets | ¥ 139,541 | ¥ 102,965 | |
Total current liabilities | (39,996) | (50,457) | |
Total liabilities | (68,430) | (77,990) | |
Net revenues | 122,880 | 141,086 | ¥ 16,267 |
Operating costs and expenses | 100,957 | 67,788 | 1,814 |
Net income (loss) | (13,085) | (4,136) | 14,431 |
Net cash generated from operating activities | ¥ 3,754 | ¥ 98,715 | ¥ 48,923 |
Other Payables and Accrued Ex_3
Other Payables and Accrued Expenses (Details) - Schedule of Other Payables and Accrued Expenses ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Schedule of Other Payables and Accrued Expenses [Abstract] | |||
Business and other tax payables | ¥ 89,715 | ¥ 77,502 | |
Refundable deposits from employees and agents | 18,239 | 19,789 | |
Professional fees | 5,609 | 3,586 | |
Accrued expenses to third parties | 33,382 | 29,861 | |
Contributions from members of eHuzhu mutual aid program (Note 2(c)) | 37,261 | 43,140 | |
Others | 1,793 | 448 | |
Total | ¥ 185,999 | $ 26,197 | ¥ 174,326 |
Short-term Loans (Details)
Short-term Loans (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2023 USD ($) | |
Short-term Loans [Abstract] | |||
Short-term loan | ¥ 164,300 | ¥ 35,679 | $ 23,141 |
Segment borrowed | ¥ 182,301 | ¥ 35,679 | |
Weighted average interest rate | 4.50% | 4.50% | |
Lines of credit for short-term loans | ¥ 35,700 | ¥ 164,321 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Employee Benefit Plans [Abstract] | |||
Employee group contributed and accrued | ¥ 131,228 | ¥ 131,385 | ¥ 118,837 |
Income Taxes (Details)
Income Taxes (Details) - CNY (¥) ¥ / shares in Units, ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes [Line Items] | |||
Income taxes rate | 8.25% | 8.25% | 8.25% |
Income tax rate | 25% | ||
Preferential tax rate percentage | 15% | ||
Income tax reduction | 50% | ||
Provision for income taxes, Percentage | 25% | 25% | 25% |
Dividend payment percentage | 10% | ||
Reduced tax rate percentage | 5% | ||
Dividend distribution withholding tax rate | 5% | ||
Income taxes, Description | According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of income taxes is due to computational errors made by the taxpayer. The statute of limitations will be extended to five years under special circumstances, which are not clearly defined, but an underpayment of income tax liability exceeding RMB100 is specifically listed as a special circumstance. In the case of a transfer pricing related adjustment, the statute of limitations is ten years. There is no statute of limitations in the case of tax evasion. During the current year, the Group reversed transfer pricing related uncertain tax position amounting to RMB3,963 when its statute of limitation expired in 2023. | ||
Valuation allowance (in Yuan Renminbi) | ¥ 81,340 | ¥ 78,627 | |
Operating loss carry-forwards (in Yuan Renminbi) | 468,715 | 385,155 | |
Tax loss carried forward expired and cancelled (in Yuan Renminbi) | 44,091 | 18,349 | ¥ 8,314 |
PRC income taxes payable without tax exemption amount (in Yuan Renminbi) | ¥ 9,956 | 12,671 | 13,523 |
Dividend paid, Description | If the entities were to be non-resident for PRC tax purposes, dividends paid to it out of profits earned after January 1, 2008 would be subject to a withholding tax. In the case of dividends paid by PRC subsidiaries, the withholding tax would be 10%, whereas in the case of dividends paid by PRC subsidiaries which are 25% or more directly owned by tax residents in the Hong Kong Special Administrative Region, the withholding tax would be 5%. The Group’s subsidiary, CNinsure Holdings Limited qualified as Hong Kong resident and was entitled to enjoy a 5% reduced tax rate under Bulletin [2018] No. 9 for the years ended December 31, 2021. | ||
Undistributed earnings of Group's subsidiaries and VIEs (in Yuan Renminbi) | ¥ 1,664,408 | 1,399,701 | |
Undistributed earnings of deferred tax liability (in Yuan Renminbi) | 83,220 | 69,985 | |
Deferred income tax (in Yuan Renminbi) | ¥ 10,349 | ||
Fanhua Lianxing Insurance Sales Co Ltd [Member] | |||
Income Taxes [Line Items] | |||
Preferential tax rate percentage | 15% | 15% | 15% |
Hong Kong [Member] | |||
Income Taxes [Line Items] | |||
Profits tax rate | 16.50% | ||
Prc [Member] | |||
Income Taxes [Line Items] | |||
Provision for income taxes, Percentage | 25% | ||
Dividend distribution withholding tax rate | 5% | 5% | 5% |
Basic net profit per share (in Yuan Renminbi per share) | ¥ 0.01 | ¥ 0.01 | ¥ 0.01 |
Diluted net profit per share (in Yuan Renminbi per share) | ¥ 0.01 | ¥ 0.01 | ¥ 0.01 |
Prc [Member] | Shenzhen Huazhong [Member] | |||
Income Taxes [Line Items] | |||
Provision for income taxes, Percentage | 12.50% |
Income Taxes (Details) - Schedu
Income Taxes (Details) - Schedule of Unrecognized Tax Benefits - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Unrecognized Tax Benefits [Abstract] | |||
Beginning balance | ¥ 36,647 | ¥ 73,213 | ¥ 67,219 |
Change in unrecognized tax benefits | |||
Increase/Decrease in tax positions | (2,279) | (36,566) | 5,994 |
Ending balance | ¥ 34,368 | ¥ 36,647 | ¥ 73,213 |
Income Taxes (Details) - Sche_2
Income Taxes (Details) - Schedule of Income Tax Expenses ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Schedule of Income Tax Expenses [Abstract] | ||||
Current tax expense | ¥ 44,836 | ¥ 13,169 | ¥ 66,665 | |
Deferred tax expense | 14,566 | 27,847 | 23,909 | |
Income tax expense | ¥ 59,402 | $ 8,367 | ¥ 41,016 | ¥ 90,574 |
Income Taxes (Details) - Sche_3
Income Taxes (Details) - Schedule of Deferred Income Tax Assets and Liabilities ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Deferred tax assets: | |||
Operating loss carryforward | ¥ 117,072 | ¥ 96,173 | |
Intangible assets, net | 5,003 | 2,856 | |
Less: valuation allowances | (81,340) | (78,627) | |
Total | 40,735 | $ 5,737 | 20,402 |
Deferred tax liabilities: | |||
Fair value adjustments in relation to short-term investments | 15,944 | 13,954 | |
Estimated profit arising from future renewal commissions | 91,428 | 59,271 | |
PRC dividend withholding taxes | 29,230 | 29,230 | |
Identifiable intangible assets | 12,549 | ||
Total | ¥ 149,151 | ¥ 102,455 |
Income Taxes (Details) - Sche_4
Income Taxes (Details) - Schedule of Effective Income Tax Rate Reconciliation ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | ||
Schedule of Effective Income Tax Rate Reconciliation [Abstract] | |||||
Income from continuing operations before income taxes, share of income of affiliates, net | ¥ 349,818 | $ 49,271 | ¥ 196,335 | ¥ 371,088 | |
PRC statutory tax rate | 25% | 25% | 25% | 25% | |
Income tax at statutory tax rate | ¥ 87,455 | ¥ 49,084 | ¥ 92,772 | ||
Expenses not deductible for tax purposes: | |||||
Entertainment | 2,417 | 2,099 | 2,950 | ||
Other | 340 | 479 | 81 | ||
Effect of tax holidays on concessionary rates granted to PRC entities | (9,956) | (12,671) | (13,523) | ||
Effect of different tax rates of subsidiaries operating in other jurisdictions | 4,110 | 2,342 | 2,070 | ||
Change in valuation allowance | 2,713 | 40,501 | 2,999 | ||
Deferred income tax for dividend distribution | 10,349 | ||||
Effect of non-taxable income | [1] | (25,709) | (4,620) | (13,777) | |
Unrecognized tax benefits arising from certain transfer pricing arrangements | (2,279) | (36,566) | 5,994 | ||
Other | 311 | 368 | 659 | ||
Income tax expense | ¥ 59,402 | $ 8,367 | ¥ 41,016 | ¥ 90,574 | |
[1] The effect of non-taxable income for years ended December 31, 2021 and 2022 represents an income tax exemption according to the Notice (Cai Shui [2002] No. 128) promulgated by the State Administration of Taxation and Ministry of Finance in China on dividend income derived from a purchased open-end securities investment fund product that the Group recorded as short term investment. The effect of non-taxable income for the year ended December 31, 2023 is primarily relating to the non-taxable gains from changes in fair value of equity interests held by the Group. |
Capital Structure (Details)
Capital Structure (Details) ¥ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 USD ($) shares | Nov. 30, 2023 shares | Aug. 31, 2023 CNY (¥) | Mar. 31, 2023 shares | |
Capital Structure [Line Items] | ||||
Cash (in Yuan Renminbi) | ¥ | ¥ 11,513 | |||
Recognizing loss (in Dollars) | $ | $ 3,043 | |||
Capital structure, description | the Company repurchased an aggregate of 526,441 ADSs from the open market and 634,946 ADSs from certain shareholders, representing 2% of the total shares outstanding as of December 31, 2023, at an average price of US$7.42 per ADS for a total amount of approximately RMB62,309, under the 2022 Share Buyback Program. | |||
Common Stock [Member] | ||||
Capital Structure [Line Items] | ||||
Shares issued (in Shares) | 3,591,780 | |||
Zhongrong [Member] | ||||
Capital Structure [Line Items] | ||||
Shares issued (in Shares) | 61,853,580 | |||
Equity interests | 0.30% | 57.73% | ||
Selling Shareholder [Member] | ||||
Capital Structure [Line Items] | ||||
Equity interests | 1.56% | |||
Zhongji [Member] | ||||
Capital Structure [Line Items] | ||||
Shares issued (in Shares) | 13,660,720 | |||
Equity interests | 51% | |||
Taiping [Member] | ||||
Capital Structure [Line Items] | ||||
Shares issued (in Shares) | 9,107,140 | 9,107,140 | ||
Equity interests | 51% | 51% | ||
Repurchase of Ordinary Shares [Member] | ||||
Capital Structure [Line Items] | ||||
Capital structure, description | the Company repurchased an aggregate of 72,465 ADSs from the open market, representing 0.1% of the total shares outstanding as of December 31, 2022,at an average price of US$7.85 per ADS for a total amount of approximately RMB3,984, under its share buyback program (“2022 Share Buyback Program”) to repurchase up to US$20 million ADSs, as previously announced by its board of directors in December 2022. |
Net Income Per Share (Details)
Net Income Per Share (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Net Income Per Share [Abstract] | |||
Employee share options |
Net Income Per Share (Details)
Net Income Per Share (Details) - Schedule of Basic and Diluted Net Income Per Ordinary Share ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) ¥ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) ¥ / shares shares | Dec. 31, 2021 CNY (¥) ¥ / shares shares | ||
Basic: | |||||
Net income | ¥ 289,099 | $ 40,719 | ¥ 85,723 | ¥ 259,941 | |
Less: Net income (loss) attributable to the noncontrolling interests | 8,622 | $ 1,215 | (14,549) | 8,952 | |
Net income attributable to the Company’s shareholders | ¥ | ¥ 280,477 | ¥ 100,272 | ¥ 250,989 | ||
Weighted average number of ordinary shares outstanding (in Shares) | [1] | 1,074,372,067 | 1,074,372,067 | 1,074,196,310 | 1,073,891,784 |
Basic net income per ordinary share (in Yuan Renminbi per share) | (per share) | ¥ 0.26 | $ 0.04 | ¥ 0.09 | ¥ 0.23 | |
Basic net income per ADS (in Yuan Renminbi per share) | ¥ / shares | ¥ 5.22 | ¥ 1.87 | ¥ 4.67 | ||
Diluted: | |||||
Net income | ¥ 289,099 | $ 40,719 | ¥ 85,723 | ¥ 259,941 | |
Less: Net income (loss) attributable to the noncontrolling interests | 8,622 | 1,215 | (14,549) | 8,952 | |
Net income attributable to the Company’s shareholders | ¥ 280,477 | $ 39,504 | ¥ 100,272 | ¥ 250,989 | |
Weighted average number of ordinary shares outstanding (in Shares) | [1] | 1,074,372,067 | 1,074,372,067 | 1,074,196,310 | 1,073,891,784 |
Weighted average number of dilutive potential ordinary shares from share options and restricted share units (in Shares) | 2,368,131 | 2,368,131 | 261,511 | 399,410 | |
Total (in Shares) | 1,076,740,198 | 1,076,740,198 | 1,074,457,821 | 1,074,291,194 | |
Diluted net income per ordinary share (in Yuan Renminbi per share) | (per share) | ¥ 0.26 | $ 0.04 | ¥ 0.09 | ¥ 0.23 | |
Diluted net income per ADS (in Yuan Renminbi per share) | ¥ / shares | ¥ 5.21 | ¥ 1.87 | ¥ 4.67 | ||
[1] The weighted average number of ordinary shares outstanding excludes the number of ordinary shares issued in business combinations occurred in 2023 through an exchange of equity interests that are treated in the same manner as contingently issuable shares because the holders must return all or part if all necessary conditions have not been satisfied by the end of the period. |
Distribution of Profits (Detail
Distribution of Profits (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Distribution of Profits [Line Items] | ||
Appropriations to the statutory surplus reserve percentage | 50% | |
Statutory reserves | ¥ 608,376 | ¥ 559,520 |
Net assets | ¥ 1,510,070 | ¥ 1,461,214 |
PRC [Member] | ||
Distribution of Profits [Line Items] | ||
Appropriations to the statutory surplus reserve percentage | 10% |
Related-Party Balances and Tr_2
Related-Party Balances and Transactions (Details) ¥ in Thousands | 12 Months Ended | |||||
Dec. 22, 2023 CNY (¥) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 22, 2023 USD ($) | Dec. 31, 2018 | |
Related-Party Balances and Transactions [Line Items] | ||||||
Commission cost | ¥ 1,590 | ¥ 13,548 | ¥ 5,386 | |||
Accounts payable | 4,987 | ¥ 2,894 | ||||
Service fee | 530 | 1,166 | ||||
Account receivable | 1 | |||||
Services expense | 3,231 | 7,017 | ||||
Other payable | ¥ 1,579 | |||||
Additional cash consideration amount | ¥ 10,463 | |||||
HPH [Member] | ||||||
Related-Party Balances and Transactions [Line Items] | ||||||
Equity interests | 4.46% | 4.46% | 4.46% | |||
Puyi Consulting [Member] | ||||||
Related-Party Balances and Transactions [Line Items] | ||||||
Equity interests | 100% | |||||
FANHUA Puyi Fund Sales Co Ltd [Member] | ||||||
Related-Party Balances and Transactions [Line Items] | ||||||
Acquire equity interest percentage | 15.41% | |||||
Highest Performances Holdings Inc. [Member] | ||||||
Related-Party Balances and Transactions [Line Items] | ||||||
Other payable | $ | $ 4.46 | |||||
Related Party [Member] | ||||||
Related-Party Balances and Transactions [Line Items] | ||||||
Other payable | ¥ 4,177 |
Concentrations of Credit Risk_2
Concentrations of Credit Risk (Details) - Schedule of Concentration of Total Net Revenue - CNY (¥) ¥ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |||
Schedule of Concentration of Total Net Revenue [Line Items] | |||||
Sales Revenue, Net | ¥ 733,243 | ¥ 497,143 | ¥ 1,212,772 | ||
Concentration risk percentage | 25.60% | 19.60% | 40.20% | ||
Sinatay Life Insurance Co., Ltd. (“Sinatay”) [Member] | |||||
Schedule of Concentration of Total Net Revenue [Line Items] | |||||
Sales Revenue, Net | ¥ 438,026 | ¥ 497,143 | ¥ 451,840 | ||
Concentration risk percentage | 15.30% | 19.60% | 15% | ||
Aeon Life Insurance Co., Ltd. (“Aeon”). [Member] | |||||
Schedule of Concentration of Total Net Revenue [Line Items] | |||||
Sales Revenue, Net | ¥ 295,217 | [1] | ¥ 437,132 | ||
Concentration risk percentage | 10.30% | [1] | 14.50% | ||
Huaxia Life Insurance Company Limited (“Huaxia”) [Member] | |||||
Schedule of Concentration of Total Net Revenue [Line Items] | |||||
Sales Revenue, Net | [1] | [1] | ¥ 323,800 | ||
Concentration risk percentage | [1] | [1] | 10.70% | ||
[1] represented less than 10% of total net revenues for the year. |
Concentrations of Credit Risk_3
Concentrations of Credit Risk (Details) - Schedule of Concentration of Accounts Receivable - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Concentration of Accounts Receivable [Line Items] | ||
Concentration risk amount | ¥ 120,574 | ¥ 210,463 |
Concentration risk percentage | 31% | 39.40% |
Sinatay [Member] | ||
Schedule of Concentration of Accounts Receivable [Line Items] | ||
Concentration risk amount | ¥ 57,119 | ¥ 124,847 |
Concentration risk percentage | 14.70% | 23.40% |
Greatwall Life Insurance Co., Ltd [Member] | ||
Schedule of Concentration of Accounts Receivable [Line Items] | ||
Concentration risk amount | ¥ 63,455 | ¥ 85,616 |
Concentration risk percentage | 16.30% | 16% |
Share-Based Compensation (Detai
Share-Based Compensation (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands | 12 Months Ended | ||||||
Feb. 06, 2023 shares | Aug. 12, 2022 ¥ / shares shares | Aug. 12, 2022 $ / shares shares | Dec. 31, 2023 CNY (¥) ¥ / shares | Dec. 31, 2023 USD ($) $ / shares | Dec. 31, 2022 CNY (¥) | Dec. 31, 2023 $ / shares | |
Share-Based Compensation [Line Items] | |||||||
Purchase ordinary shares (in Shares) | shares | 4,000,000 | 4,000,000 | |||||
Exercise price per share | (per share) | ¥ 1.64 | $ 0.2305 | |||||
Intrinsic value | (per share) | ¥ 0.01 | $ 0.002 | |||||
Share-based compensation expenses | $ 1,987 | ¥ 13,627 | |||||
Unvested share options granted | ¥ 2,684 | $ 22,258 | 3,942 | ||||
Restricted share agreement description | the Company granted 536,990 ADSs to an executive office. Pursuant to the agreement entered into between the Company and the grantee, the ADSs vest over a five-year service period starting from the date of grant, with 100,000 ADSs, 100,000 ADSs, 136,990 ADSs, 100,000 ADSs and the remaining 100,000 ADSs being vested on June 30 of each of the years starting from 2024 to 2028, respectively, subject to the continuous service of the grantee (“RSUs”). | the Company granted 536,990 ADSs to an executive office. Pursuant to the agreement entered into between the Company and the grantee, the ADSs vest over a five-year service period starting from the date of grant, with 100,000 ADSs, 100,000 ADSs, 136,990 ADSs, 100,000 ADSs and the remaining 100,000 ADSs being vested on June 30 of each of the years starting from 2024 to 2028, respectively, subject to the continuous service of the grantee (“RSUs”). | |||||
Restricted share units market price (in Dollars per share) | $ / shares | $ 6.35 | ||||||
Recognized over a weighted-average period | 4 years 6 months | 4 years 6 months | |||||
Options granted | ¥ | ¥ 9,918 | ||||||
Weighted-average period | 1 year 3 months | 1 year 3 months | |||||
Forfeiture rate | 17% | 17% | |||||
2012 Option G [Member] | |||||||
Share-Based Compensation [Line Items] | |||||||
Share-based compensation expenses | ¥ | ¥ 1,481 | ¥ 461 | |||||
521 Plan [Member] | |||||||
Share-Based Compensation [Line Items] | |||||||
Termination of employment or agency contract | The unvested share options expense relating to the share options with a graded vesting schedule is expected to be recognized over a weighted-average period of 2.6 years on a straight-line basis at an amount which at least equals the portion of the grant-date fair value of the 2022 Options that are vested at that date. | The unvested share options expense relating to the share options with a graded vesting schedule is expected to be recognized over a weighted-average period of 2.6 years on a straight-line basis at an amount which at least equals the portion of the grant-date fair value of the 2022 Options that are vested at that date. | |||||
Option D1 [Member] | |||||||
Share-Based Compensation [Line Items] | |||||||
Options grant percentage | 30% | 30% | |||||
Option D2 [Member] | |||||||
Share-Based Compensation [Line Items] | |||||||
Options grant percentage | 30% | 30% | |||||
Option D3 [Member] | |||||||
Share-Based Compensation [Line Items] | |||||||
Options grant percentage | 20% | 20% | |||||
Option D4 [Member] | |||||||
Share-Based Compensation [Line Items] | |||||||
Options grant percentage | 20% | 20% | |||||
Directors And Employees [Member] | 2012 Option G [Member] | |||||||
Share-Based Compensation [Line Items] | |||||||
Options to purchase ordinary shares (in Shares) | shares | 13,680,000 | ||||||
Description of option grantees | Pursuant to the option agreements entered into between the Company and the option grantees, the options vest over a two-year service period starting from the date of grant, with 50% and the remaining 50% of the options being vested on March 31, 2024 and March 31, 2025, respectively, subject to the continuous service of the option grantees and the achievement of the performance conditions. | Pursuant to the option agreements entered into between the Company and the option grantees, the options vest over a two-year service period starting from the date of grant, with 50% and the remaining 50% of the options being vested on March 31, 2024 and March 31, 2025, respectively, subject to the continuous service of the option grantees and the achievement of the performance conditions. | |||||
Exercise price of options | (per share) | ¥ 0.35 | $ 0.05 | |||||
Intrinsic value of per ordinary share | (per share) | ¥ 2.22 | $ 0.3125 |
Share-Based Compensation (Det_2
Share-Based Compensation (Details) - Schedule of Share Options Outstanding - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jan. 01, 2023 | Dec. 31, 2023 | |
2022 Options [Member] | ||
Share-Based Compensation (Details) - Schedule of Share Options Outstanding [Line Items] | ||
Number of options, Outstanding Ending | 4,000,000 | |
Weighted average exercise price, Outstanding Ending | $ 0.2305 | |
Weighted average remaining contractual life, Outstanding Ending | 5 years 2 months 8 days | |
Aggregate Intrinsic Value, Outstanding Ending | $ 408 | |
2023 MDRT Options [Member] | ||
Share-Based Compensation (Details) - Schedule of Share Options Outstanding [Line Items] | ||
Number of options, Outstanding Ending | 11,300,000 | |
Weighted average exercise price, Outstanding Ending | $ 0.05 | |
Weighted average remaining contractual life, Outstanding Ending | 3 years 7 months 2 days | |
Aggregate Intrinsic Value, Outstanding Ending | $ 3,192 | |
Number of options, Granted | 13,680,000 | |
Weighted average exercise price, Granted | $ 0.05 | |
Weighted average remaining contractual life, Granted | 4 years 5 months 26 days | |
Aggregate Intrinsic Value, Granted | $ 4,275 | |
Number of options, Exercised | ||
Weighted average exercise price, Exercised | ||
Aggregate Intrinsic Value, Exercised | ||
Number of options, Forfeited | (2,380,000) | |
Weighted average exercise price, Forfeited |
Share-Based Compensation (Det_3
Share-Based Compensation (Details) - Schedule of Activity of Service-Based RSUs - Restricted Stock Units (RSUs) [Member] | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Share-Based Compensation (Details) - Schedule of Activity of Service-Based RSUs [Line Items] | |
Number of restricted shares, Unvested as of beginning | shares | |
Weighted average grant-date fair value, Unvested as of beginning | $ / shares | |
Number of restricted shares, Granted | shares | 536,990 |
Weighted average grant-date fair value, Granted | $ / shares | $ 3,410 |
Number of restricted shares, vested | shares | |
Weighted average grant-date fair value, vested | $ / shares | |
Number of restricted shares, Forfeited | shares | |
Weighted average grant-date fair value, Forfeited | $ / shares | |
Number of restricted shares, Unvested as of ending | shares | 536,990 |
Weighted average grant-date fair value, Unvested as of ending | $ / shares | $ 3,410 |
Share-Based Compensation (Det_4
Share-Based Compensation (Details) - Schedule of Fair Value of the 2023 MDRT Options on the Grant - Feb. 06, 2023 | ¥ / shares | $ / shares |
Share-Based Compensation (Details) - Schedule of Fair Value of the 2023 MDRT Options on the Grant [Line Items] | ||
Expected dividend yield (Note i) | 3.69% | 3.69% |
Risk-free interest rates (Note ii) | 3.88% | 3.88% |
Expected volatility (Note iii) | 51.41% | 51.41% |
Expected life in years (Note iv) | 4 years 5 months 26 days | 4 years 5 months 26 days |
Exercise multiple (Note v) (in Yuan Renminbi per share) | ¥ / shares | ¥ 2.8 | |
Minimum [Member] | ||
Share-Based Compensation (Details) - Schedule of Fair Value of the 2023 MDRT Options on the Grant [Line Items] | ||
Fair value of options on grant date (in Dollars per share) | $ 0.2896 | |
Maximum [Member] | ||
Share-Based Compensation (Details) - Schedule of Fair Value of the 2023 MDRT Options on the Grant [Line Items] | ||
Fair value of options on grant date (in Dollars per share) | $ 0.2997 |
Segment Reporting (Details)
Segment Reporting (Details) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Segment Reporting [Abstract] | ||
Number of operating segments | 2 | 2 |
Segment Reporting (Details) - S
Segment Reporting (Details) - Schedule of Segment Reporting Information, by Segment ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Net revenues | ||||
Total net revenues | ¥ 3,198,389 | $ 450,484 | ¥ 2,781,614 | ¥ 3,271,114 |
Operating costs and expenses | ||||
Total operating costs and expenses | (3,002,564) | (422,903) | (2,612,939) | (2,969,209) |
Income (loss) from operations | ||||
Income from operations | 195,825 | 27,581 | 168,675 | 301,905 |
Agency [Member] | ||||
Net revenues | ||||
Total net revenues | 2,760,448 | 388,801 | 2,376,851 | 2,811,936 |
Operating costs and expenses | ||||
Total operating costs and expenses | (2,422,386) | (341,187) | (2,068,194) | (2,418,444) |
Income (loss) from operations | ||||
Income from operations | 338,062 | 47,614 | 308,657 | 393,492 |
Claims Adjusting [Member] | ||||
Net revenues | ||||
Total net revenues | 437,941 | 61,683 | 404,763 | 459,178 |
Operating costs and expenses | ||||
Total operating costs and expenses | (418,589) | (58,958) | (416,619) | (442,349) |
Income (loss) from operations | ||||
Income from operations | 19,352 | 2,725 | (11,856) | 16,829 |
Other [Member] | ||||
Operating costs and expenses | ||||
Total operating costs and expenses | (161,589) | (22,758) | (128,126) | (108,416) |
Income (loss) from operations | ||||
Income from operations | ¥ (161,589) | $ (22,758) | ¥ (128,126) | ¥ (108,416) |
Segment Reporting (Details) -_2
Segment Reporting (Details) - Schedule of Segment Assets ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Segment assets | |||
Total assets | ¥ 4,050,884 | $ 570,555 | ¥ 3,089,516 |
Agency [Member] | |||
Segment assets | |||
Total assets | 2,515,467 | 354,296 | 1,513,449 |
Claims Adjusting [Member] | |||
Segment assets | |||
Total assets | 259,325 | 36,524 | 252,130 |
Other [Member] | |||
Segment assets | |||
Total assets | ¥ 1,276,092 | $ 179,735 | ¥ 1,323,937 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] - USD ($) $ / shares in Units, $ in Millions | Feb. 02, 2024 | Feb. 20, 2024 |
2023 Share Incentive Plan [Member] | ||
Subsequent Events [Line Items] | ||
Shares reserved | 113,423,618 | |
Outstanding ordinary shares, percentage | 10% | |
2023 Share Incentive Plan [Member] | ||
Subsequent Events [Line Items] | ||
Purchase of new shares | 5,799,925 | |
Exercise price per share | $ 0.001 | |
Singapore White Group Pte. Ltd. [Member] | ||
Subsequent Events [Line Items] | ||
Investment | $ 500 | |
Telehealth Solution Provider and an AI Humanoid Hardware [Member] | ||
Subsequent Events [Line Items] | ||
Investment | $ 500 |
Schedule I_Condensed Financia_3
Schedule I—Condensed Financial Information of the Company (Details) ¥ in Thousands | 12 Months Ended |
Dec. 31, 2023 CNY (¥) | |
Schedule I—Condensed Financial Information of the Company [Abstract] | |
Maximum percentage of consolidated net assets | 25% |
Restricted capital and reserves | ¥ 1,510,070 |
Schedule I_Condensed Financia_4
Schedule I—Condensed Financial Information of the Company (Details) - Schedule of Balance Sheet - Parent [Member] ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Current assets: | |||
Cash and cash equivalents | ¥ 23,595 | $ 3,323 | ¥ 38,512 |
Short term investments | 27,619 | ||
Other receivables and amounts due from subsidiaries and affiliates | 450,933 | 63,513 | 417,613 |
Total current assets | 474,528 | 66,836 | 483,744 |
Non-current assets: | |||
Investment in subsidiaries | 3,010,729 | 424,052 | 2,520,667 |
Investment in an affiliate | 4,035 | ||
Other non-current asset | 13,461 | 1,896 | |
Total assets | 3,498,718 | 492,784 | 3,008,446 |
Current liabilities: | |||
Other payables and accrued expenses and amounts due to subsidiaries | 1,427,456 | 201,053 | 1,385,043 |
Total liabilities | 1,427,456 | 201,053 | 1,385,043 |
Ordinary shares (Authorized shares:10,000,000,000 at US$0.001 each; issued 1,074,291,784 and 1,158,913,224 shares, of which 1,072,842,484 and 1,134,236,184 shares were outstanding as of December 31, 2022 and 2023, respectively) | 8,675 | 1,222 | 8,091 |
Treasury Stock | (178) | (25) | (10) |
Additional paid-in capital | 162,721 | 22,919 | 461 |
Retained earnings | 1,927,981 | 271,550 | 1,647,504 |
Accumulated other comprehensive loss | (27,936) | (3,935) | (32,643) |
Total equity | 2,071,263 | 291,731 | 1,623,403 |
Total liabilities and shareholders’ equity | ¥ 3,498,719 | $ 492,784 | ¥ 3,008,446 |
Schedule I_Condensed Financia_5
Schedule I—Condensed Financial Information of the Company (Details) - Schedule of Balance Sheet (Parentheticals) - Parent [Member] - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of Balance Sheet [Line Items] | ||
Ordinary shares, authorized | 10,000,000,000 | 10,000,000,000 |
Ordinary shares, par value (in Dollars per share and Yuan Renminbi per share) | $ 0.001 | |
Ordinary shares, issued | 1,158,913,224 | 1,074,291,784 |
Ordinary shares, outstanding | 1,134,236,184 | 1,072,842,484 |
Schedule I_Condensed Financia_6
Schedule I—Condensed Financial Information of the Company (Details) - Schedule of Statements of Income and Comprehensive Income - Parent Company [Member] ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Condensed Income Statements, Captions [Line Items] | ||||
General and administrative expenses | ¥ (11,018) | $ (1,552) | ¥ (11,318) | ¥ (331) |
Selling expenses | (13,627) | (1,919) | ||
Interest income | 1,201 | 169 | 5 | 2 |
Others, net | 17,009 | 2,395 | 17,495 | |
Equity in earnings of subsidiaries and an affiliate | 286,912 | 40,411 | 94,090 | 251,318 |
Net Income attributable to the Company’s shareholders | 280,477 | 39,504 | 100,272 | 250,989 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | 2,249 | 317 | 3,728 | (9,116) |
Unrealized net gains on available-for-sale investments | 2,458 | 346 | (1,919) | 6,252 |
Share of other comprehensive (loss) gain of affiliates | 4,688 | (1,281) | ||
Comprehensive income attributable to the Company’s shareholders | ¥ 285,184 | $ 40,167 | ¥ 106,769 | ¥ 246,844 |
Schedule I_Condensed Financia_7
Schedule I—Condensed Financial Information of the Company (Details) - Schedule of Statements of Cash Flows - Parent Company [Member] ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Cash flow from operating activities: | ||||
Net income | ¥ 280,477 | $ 39,504 | ¥ 100,272 | ¥ 250,989 |
Adjustments to reconcile net income to net cash used in operating activities: | ||||
Equity in earnings of subsidiaries and an affiliate | (312,323) | (43,990) | (94,090) | (251,318) |
Compensation expenses associated with stock options | 17,095 | 2,408 | 461 | |
Other non-cash adjustments | (22,569) | (3,179) | ||
Changes in operating assets and liabilities: | ||||
Other receivables | (20) | (3) | 392 | |
Accrued payroll and Other payables | 820 | 116 | 696 | (847) |
Net cash (used in) from operating activities | (36,520) | (5,144) | 7,339 | (784) |
Cash flows (used in) generated from investing activities | ||||
Changes in investment in subsidiaries and an affiliate | 2,458 | 346 | 907,006 | 43,757 |
Advances to subsidiaries and affiliates | (10,005) | (1,409) | (689,780) | 157,582 |
Proceeds from disposal of short-term investments | 27,639 | 3,893 | 10,095 | |
Net cash generated from investing activities | 20,092 | 2,830 | 227,321 | 201,339 |
Cash flows generated from (used in) financing activities: | ||||
Proceeds on exercise of stock options | 2 | |||
Dividends paid | (317,730) | (242,518) | ||
Repurchase of ordinary shares from open market | (29,044) | (4,091) | (3,984) | |
Net cash generated used in financing activities | (29,044) | (4,091) | (321,712) | (242,518) |
Net decrease in cash and cash equivalents | (45,472) | (6,405) | (87,052) | (41,963) |
Cash and cash equivalents and restricted cash at beginning of year | 38,512 | 5,424 | 14,507 | 66,345 |
Effect of exchange rate changes on cash and cash equivalents | 30,555 | 4,304 | 111,057 | (9,875) |
Cash and cash equivalents and restricted cash at end of the year | ¥ 23,595 | $ 3,323 | ¥ 38,512 | ¥ 14,507 |