Discontinued Operations

12 Months Ended

Aug. 31, 2022

Discontinued Operations [Abstract]

DISCONTINUED OPERATIONS

3. DISCONTINUED OPERATIONS

As refer to Note 2(a), in connection with the deconsolidation of the Affected Entities, the Group evaluated and concluded that the Affected Entities should be accounted as discontinued operations during the year ended and as of August 31, 2021.

Reconciliation of the carrying amounts of the major classes of assets and liabilities from the discontinued operations in the consolidated balance sheets as of August 31, 2021 is as follow. In addition, on August 31, 2021, the Group recorded RMB 261,267 one-off loss for the deconsolidation of the Affected Entities, and the carrying amounts of the major classes of assets and liabilities at deconsolidation date is presented as follow.

	As of August 31,
	2021
	RMB
ASSETS
Current assets
Cash and cash equivalents		2,881,737
Restricted cash, net of allowance of RMB 4		30,553
Accounts receivable, net of allowance of RMB 2,854		6,541
Amounts due from related parties, net of allowance of RMB 50		3,148
Other receivables, deposits and other assets, net of allowance of RMB 88		49,003
Inventories		23,200
Amounts due from continuing operations		333,270
Total current assets		3,327,452
Property and equipment, net		510,862
Land use rights, net		83,949
Intangible assets, net		78,373
Goodwill, net		231,386
Prepayments for construction contracts		3,863
Deferred tax assets, net		4,109
Operating lease right-of-use assets – non current		157,813
Other non-current assets, net of allowance of RMB 343		13,335
Total non-current assets		1,083,690
TOTAL ASSETS		4,411,142
LIABILITIES
Current liabilities
Short-term loan		77,500
Accounts payables		21,745
Amounts due to related parties		38,422
Accrued expenses and other current liabilities		512,404
Income tax payable		38,678
Operating lease liabilities – current		6,343
Contract liabilities		1,229,601
Refund liabilities		14,008
Amounts due to continuing operations		2,028,866
Total current liabilities		3,967,567
Deferred tax liabilities		22,959
Other non-current liabilities		2,213
Operating lease liabilities – non-current		157,136
Total non-current liabilities		182,308
TOTAL LIABILITIES		4,149,875

Reconciliation of the major classes of income and losses from discontinued operations in the consolidated statements of operations and comprehensive loss for the years ended August 31, 2020 and 2021 is as follow:

	For the year ended August 31,
	2020			2021
	RMB			RMB
Revenue		1,890,156			2,303,339
Cost of revenue		(1,085,249	)		(1,315,026	)
Gross profit		804,907			988,313
Selling, general and administrative expenses		(308,554	)		(400,012	)
Other operating income		3,900			7,604
Impairment loss on goodwill*		(68,723	)		-
Operating income		431,530			595,905
Interest income/(expense), net		3,560			(695	)
Investment income		52,509			56,657
Other expenses		(927	)		(4,180	)
Income before income taxes and share of equity in loss of unconsolidated affiliate		486,672			647,687
Income tax expense		(15,177	)		(16,877	)
Share of equity in loss of unconsolidated affiliate		-			(200	)
Net income (before one-off loss upon deconsolidation of the Affected Entities)		471,495			630,610
One-off loss upon deconsolidation of the Affected Entities, net of tax		-			(261,267	)
Net income from discontinued operations		471,495			369,343
Summarized cash flow information for discontinued operations are as follows:
Net cash provided by operating activities		308,989			516,873
Net cash (used in)/provided by investing activities**		(329,453	)		137,323
Net cash provided by/(used in) financing activities***		1,690,275			(153,987	)

Note*: For the year ended August 31, 2020, the Group has determined that based on the underperformance of the Wuhan Sannew reporting unit since the acquisition date, market conditions and other factors including the uncertainty in the Sino-US relationship and adverse impacts from COVID-19, it was more likely than not that the fair value of Wuhan Sannew reporting unit was less than the carrying amount. The Group utilized the discounted cash flow model to estimate the fair value of the reporting unit and concluded the carrying amount of Wuhan Sannew reporting unit exceeded its fair value. Accordingly, the Group recorded RMB 68,723 as impairment loss on goodwill on the consolidated statement of operations for the year ended August 31, 2020.

Note**: There was amount of RMB 271,577 cash invested into continuing operations during the year ended August 31, 2020. The amount of RMB 192,373 cash was redeemed from continuing operations for the year ended August 31, 2021.

Note***: There was amount of RMB 1,641,732 cash received from continuing operations by the Affected Entities during the year ended August 31, 2020. The amount of RMB 111,668 was repaid to continuing operations for the year ended August 31, 2021.