Caixin
Caixin Global – Latest China News & Headlines

Home >

ABOUT US

CX Tech is Caixin Global's real-time tech news portal, featuring 24-hour news, short-form analysis, and roundups from business and tech media in China.

TRENDING
Tesla’s China-Built Cars Qualify for Government Subsidies in the Country
China Sees Another Potential Bond Default by Local Government Financing Vehicle
Chinese E-Commerce Platform Declares Bankruptcy Amid Cash Crunch
LATEST
Tencent Teams Up with Tech Firms to Build Satellite Network
JD.com's Liu Quietly Exits Posts at Several Units, but Maintains Shareholder Control
New Campus Harassment Claims Highlight China’s Embattled #MeToo Movement
British Businesses Eye Increased China Investment Despite Concerns, Report Finds
Huawei to Equip More of Its Devices with Its Harmony OS in 2020
China Unveils New National Pipeline Operator in Key Industry Revamp
Ambitious Nanjing Chip Project Faces Capital Strain
Xiaomi Takes on Apple in Japan With 108-Megapixel Budget Smartphone
BYD Sees Sharp Drop in New-Energy Car Sales in November
Bilibili Wins Exclusive Rights to Stream League of Legends Championship
Baidu Files the Most AI Patent Applications in China, Again
State Energy Giant Announces Mammoth Fracking Target for 2020
Landmark Transgender Discrimination Case Opens in East China
China Sees Another Potential Bond Default by Local Government Financing Vehicle
Dong Mingzhu, One of China's Toughest Businesswomen
Chinese AI Firm Eyes $750 Million Yearly Revenue Despite U.S. Blacklisting: Reports
Chinese E-Commerce Platform Declares Bankruptcy Amid Cash Crunch
Tesla’s China-Built Cars Qualify for Government Subsidies in the Country
Air Taxi Maker EHang Slashes U.S Listing Target to $46 Million
Sweetome Acquires 2 Units as Homestay Sector Defies Sharing-Economy Gloom
Regulator Finds Kangmei Pharma Fabricated Financial Reports

By Wang Juanjuan and Denise Jia / May 18, 2019 05:08 AM / Finance

Photo: IC Photo

Photo: IC Photo

China’s securities regulator concluded an investigation of one of China’s largest listed drugmakers, finding the company fabricating its financial reports from 2016 to 2018.

Shanghai-listed traditional Chinese medicine supplier Kangmei Pharmaceutical Co. Ltd. used fake bank deposit slips to inflate its cash reserves, forged documents for non-existent business activities, and transferred company funds to related parties to trade in its own stock, the China Securities Regulatory Commission (CSRC) said Friday.

Kangmei’s auditor, GP Certified Public Accountants Co. Ltd., the largest auditing company in Guangdong, was also put under investigation for failure to perform due diligence.

Kangmei disclosed April 30 that it was targeted by regulators on suspicion of false financial reports involving a 29.9 billion yuan ($4.4 billion) overstatement of cash on hand.

But the company’s founder and chairman Ma Xingtian described the overstatement as an “accounting error” as results of loopholes in internal controls and financial management. After correcting the accounts, the company’s net profit in 2016 and 2017 would have been reduced by half.

Kangmei was previously involved in several bribery cases involving government officials. According to court documents released last June, the company bribed Cai Ming, former director of the drug safety supervision department at the Guangdong Province Food and Drug Administration, to the tune of 300,000 yuan from 2014 to 2015.

In February, the company was rattled by default risks on $300 million of bonds. The crisis was eased later after the Guangdong provincial government stepped in.

Share this article
Open WeChat and scan the QR code