Kelon strategic review
1, ; Guangdong Kelon Electrical Co., Ltd. Enterprise mm refrigerator plant in Shunde, Guangdong Pearl River Main refrigerators initial production capacity of 3 million units / year.
1987 12 months, the Pearl River in Guangdong Shunde, Guangdong Zhujiang Refrigerator Factory was renamed as refrigerator factory to expand production In 1988 according to the needs of the Guangdong Pearl refrigerator plant with three foreign companies to set up a joint venture may sound Refrigerator Co., Ltd. of Guangdong. refrigerator plant in Guangdong Zhujiang Refrigerator Co., Ltd. and Guangdong may sound the same time there is both an independent production of household refrigerators.
1992 12 months, Guangdong Pearl River Refrigerator Factory in accordance with the views of the private placement stock specification means restructuring of the Company.
1996 4 months, town, Shunde city Economic Development Corporation odd to hold shares of the Company to transfer all Kelon (Rongsheng) Group to enable the company to become Kelon (Rongsheng) Group owned subsidiary.
1996 5 months, the company merged with the sound volume Refrigerator Co., Ltd. of Guangdong. The combined company adopted the name of the company's production capacity will reach 150 refrigerator million / year. the original sound of the refrigerator Co., Ltd, Guangdong Yung interests of foreign parties all convertible into shares of the company.
1996 7 months, according to resolutions of shareholders and the approval by the state departments of the public offering of the H shares of the company 4.5959 billion shares and the listing .1997 March the Ministry of Foreign Trade and Economic Cooperation approved by the Company for the Foreign Funds.
1999 5 31, Kelon Electrical and publicly released in the Shenzhen Stock Exchange A shares 110,000,000 shares, issue price of 9.98 yuan; total capital increased to 992,000,000 shares (non state-owned shares); A-share listed Date: July 13, 1999; stock code: 000 921; Stock code: Kelon Electric.
2000, the A share market next year, will be unceremoniously Kelon Electrical 678 million net loss; loss is actually the reason the industry competition, product prices have fallen.
2001 year, Kelon again huge loss, when the new loss of 1.557 billion yuan; loss because the market remains highly competitive. As two years of losses, the woman was wearing the hat of ST.
huge loss in two years, more than 22 million cumulative cases, If the third year of continued losses, the exit must be no doubt. However, almost no suspense in the Start the acquisition of Kelon Electric, acquired in April 2002 the work completed. Gu Chujun official White Kelon Electric, and served as its chairman of the board until today, Kelon Electrical annual salary paid to him for 600 million Hong Kong dollars.
2002, Kelon Electrical miraculously and easily into the black; 2003 is disposed of once hung in three years on account of accumulated losses and retained earnings per share on account from the previous year The reverse is +0.1859 -1.22 Yuan RMB.
Unfortunately, not last, two years after the losses, Kelon Electrical re At the same time issued by the auditor China Securities Regulatory Commission has been a criminal investigation. It is said that, in addition to the Working Group sent into Kelon, the Commission also asked some of Kelon violation of securities laws, the initiative to provide relevant information for investigation.
5 12, Deloitte Kwan Wong Tan & Fong CPA that no longer serve as the Hong Kong-listed Kelon Electrical (0921, HK) auditors, and its partner agencies in the country accounting firm Deloitte Touche Tohmatsu nor any of the Mainland continued listing of Kelon's auditor .
6 24, three independent directors of Kelon Electrical Bailey Chang Chen, Li Gongmin, Xu Lu abruptly resigned collectively. Bailey Chang Chen, Li Gongmin, Xu Lu as Independent Director in more than two years, the annual allowances were as high as 36 million, more than 1,400 companies in the Mainland stock market the highest annual allowance.
2005 7 11, Yan Yiming the a low of 1.64 yuan the year 1999 on July 20, Kelon Electrical newly listed A shares was 25.4 yuan soon rushed to the history of the highest price.
2005 7 14, issued the Pre-losing Kelon Electrical announcement, saying that as of this year, sales in June compared with same period last year more than 50% during the first half of this year the company will appear more substantial losses.
2, Kelon Electrical rebirth of private M & A has a brilliant Kelon
electrical appliances, change of property rights because they do not complete the bitter taste of a huge loss, but through the restructuring of private enterprises Greencool, corporate brand, product, market and operating scale have reached a new height.
Source: Securities Market Weekly of: Wu Chuan Publishing Date :2004-12-12
8 In late May, to Kelon Electrical (000 921) a majority shareholder Greencool criticized by scholars as the beginning of Hong Kong, continuing a two-month wave of state-owned property rights reform swept the country the great debate . However, in the opinion of the fierce battle in the pace of capital expansion Kelon failed to stop.
10 14, the largest shareholder of Guangdong Kelon Electrical Greencool Enterprise Development Co., Ltd. (hereinafter referred to Greencool) holdings of the company to 97.64 million yuan 5.79% equity stake to 26.43%. October 27, Kelon Kelon Electrical and Development Co., Ltd. a wholly owned subsidiary and smooth Fusha Town, Zhongshan Industrial Co., Ltd. signed an agreement $ 24,160,000 joint venture power of Guangdong Kelon Electrical Appliance Co., Ltd. was established. Kelon Kelon Electrical power of actual control 80% stake, in order to enter the washing machine industry, trying to build a covered refrigerators, air conditioners, washing machines, home appliance product line. This is considered Kelon to create case.
10 end of the State Council Development Research Center, released by the Zhang Wenkui Enterprise Institute, authored research group went to research reports Kelon Electrical mm and privatization, restructuring, and after a Shunde, Guangdong entrepreneurs Penning Rongqi with the town government's 9 million trial fees are given to parts on behalf of the mold, for testing products with soda bottles, with the hand hammer, hand filing and other simple tools, multimeter, and other simple test equipment, in successful trial under primitive conditions, the Chinese first two-door refrigerator. October 28, 1984, the predecessor of Pearl Kelon refrigerator plant was established.
planned economy at that time, the national fixed license to produce refrigerators, plans to rely on the supply of raw materials. Pearl refrigerator factory business entrepreneurs to find ways to link it to the Office of the Guangdong Provincial Machinery, squeezed into the first batch of 42 refrigerator manufacturing enterprises to become China's first manufacturer of refrigerators. Pearl 1991 refrigerators refrigerator production plant 48 million units, the first industry-wide production. January 29, 1992, *** southern tour to the Pearl River refrigerator factory, said that August 1992 approved the restructuring of the Pearl River refrigerator plant for the Pearl River Electric Co., converted into shares for the assets of 80% of the total share capital of the legal person shares owned by the town government Rongqi Town Economic Development Corporation holds the same time, the staff issued 84,480,000 shares of 1 yuan, accounting for 20%. offering completed in October that year, renamed the Guangdong Kelon Electrical Co., Ltd., Kelon trademark opening in early 1993. the years after 1993, Kelon refrigerator rapid increase in production, 1995 exceeded 100 million units in 1996, over 1.8 million units.
1996 7 months, Kelon Electrical H shares listed in Hong Kong, becoming the first mainland township enterprises listed in Hong Kong, to raise funds 800,000,000 yuan, after the release of foreign investment shares accounted for 47.55%. Two years later, in July 1999, 110,000,000 shares of Kelon Electrical visit the Shenzhen Stock Exchange A share, raising 1.06 billion yuan of funds.
just 3 years to achieve the two listed Kelon, raising nearly 20 billion in funds controlled by the town government actually reached its peak Kelon. Kelon refrigerator production in 1999 reached a record 2.65 million units, total sales of 5.8 billion, net profit reached nearly 630 million yuan.
but , behind the prosperity of the crisis. National Research Center research companies reported that a thorough reform of property rights does not lead to new rules and old system of the collision, to the heyday of Kelon is leaving a huge risk. listing, although the government through the shell Group Companies may sound continuously diluted shares are held, it is still the de facto controlling shareholder. Kelon Electrical listing to create new rules of the game, but the old relationship between government and enterprises has not fundamentally changed, Kelon Electrical in After a brief heyday, and to decline rapidly destabilize. In 2000, sales in 2001, Kelon Electrical sharp decline in huge losses for two consecutive years, ST wear a hat, and local government securities market was caused great shock.
Private Reorganization
in the strategic reorganization of state-owned assets to encourage private economic development environment, a thorough reform took Kelon mm privatization restructuring. October 2001, private enterprises in Shunde City Greencool transferee reason Ronggui town government held 20.6% of Kelon shares, becoming its largest shareholder.
Kelon Electrical reform of property rights by the Government of the rectitude of shares cut the link out to solve the bit better overcome. privatization restructuring has been a miracle given to re-start opportunity for Kelon.
rest a little.
Third, public opinion approved Deloitte
1, Kelon said nothing about the details of the talk about false dilemma Deloitte Ethics
Source: First Financial Daily Author: Hong Qihua Time :2005-08-05
with the Commission on the qualitative Kelon Electrical financial fraud, the audit agency had as Kelon Deloitte Touche Tohmatsu Certified Public Accountants The (more problems; and step back and admit mm on the audit issue, not only could face compensation, will be discredited, causing a greater shock. eventually need to make a choice. yesterday, Deloitte's public relations officer, said to this reporter: br> Subsequently, Deloitte & Touche to the newspaper sent an official statement said: industry, one of the highest levels of leadership, Deloitte has always been to perform to maintain its high degree of business transparency and commitment to professional ethics are very proud of. do not backward, but the highest level of the global audit industry leader to prove his innocence. can not be identified by virtue of.
In fact, the international Experts questioned.
high transparency and high degree of professional ethics are becoming pale.
contact the judge, event, it is easy to emerge in people's memories.
, and Chen Huizhu, companies have to meddle in the issue, this detail is obviously reluctant to talk about the Deloitte Touche Tohmatsu.
In addition, the findings from the Commission point of view, Kelon's financial statements in 2003 is difficult to be recognized. a series of orders The details of the suspect will probably continue to Deloitte dilemma.
2, Deloitte, what role events in Kelon
Source: International Finance News on: Wu, a time :2005-08-05
Deloitte's response, as early as we expected. This is typical of the crisis public relations practices. If the Deloitte has been at the relevant contact no one answered the phone or hang up the state.
findings according to China Securities Regulatory Commission since 2002, the legal representative of Kelon, Kelon Chairman Gu Chujun and other electrical appliances in to inflated income, less accrued expenses and other means, inflated profits, resulting in the company's financial report disclosed serious discrepancies with the facts. Since July 28, 2002 appointed to the post-Kelon Electrical auditor, Big Four accounting firm Deloitte & Touche, one of the company from 2002 to 2004 who have annual financial report of the audit report issued.
three possibilities for the Deloitte financial event in Kelon may play a role, a senior accountant to reporters of the usual three possibilities exist. The first possibility is: did not find problems caused by inadequate capacity; second possibility is: the practice of the enterprise open eyes closed eyes, but the auditors have the courage to do the prerequisite mmm that business risk is not going to burst; third could be: some figures and information listed on the auditors did not fully open, resulting in an auditor can not find the problem.
audit agency must issue a reservation on this. report.
but ZHU told reporters that in 2002, Deloitte issued unqualified years audit report, the matter with the China Securities Regulatory Commission are investigating the discovery of inflated income, less accrued expenses and other issues not specifically related; and In the 2004 financial statements, Deloitte & Touche audit report issued by the reservation, because of Kelon Electrical Sales returns on income and limited scope of the audit, but also with the financial statements for the disclosure of Kelon does not meet the accounting standards promulgated by the State and enterprises the provisions of the relevant accounting system audit report issued reservations are essentially different.
addition, ZHU that the year 2003 issued by Deloitte unqualified audit report means: Deloitte that Kelon's financial statements are consistent with Accounting Standards issued by the State and the relevant provisions of the accounting system, while unqualified audit report means: For the 2003 audit of financial statements, Deloitte has been the independent auditing standards in accordance with the implementation of the audit work plan, the audit process is not restricted There is no disclosure should be adjusted or not been adjusted Kelon Electrical or disclosure of important matters.
two accountants
However, Kelon Electrical and Deloitte's audit opinion issued by the same profile is: Kelon audit practice of two experienced certified public accountants signed.
reporter was informed that an accountant is at the same time since 2002, Deloitte Gujing signed the audit accountant, and a coincidence: Gujing also This year has been the Commission to initiate an investigation. Another ground transit CPA accounting firm previously was a partner, while the transit ground events are due to the significant audit Guangxia fault revoked by the Ministry of Finance qualification. Although by virtue only of the professional
issued by the lack of capacity led to a significant false documents or conspiring with the Gu Chu Jun, who intentionally provides false documents.
Deloitte may be aware of the risk analysis told reporters, when Deloitte decided not to act as Kelon audit institutions, may be aware of the risks. public information, Kelon received at the May 11 notice of Deloitte & Touche decided to withdraw from the audit, the CSRC stationed Kelon time in April.
event for Deloitte Kelon , this reporter on August 4 by calling the self-regulatory body mmm domestic accounting Chinese CPA Association, said the Ministry of Supervision to comment on this inconvenience. Subsequently, the reporter contacted the Ministry of Finance Accounting Division, the relevant department of the defendant are questions while on the go can not contact them.
and this event more than the protagonist who Kelon's when interviewed, seems reluctant to talk about Deloitte.
reporter was informed that the Hong Kong Stock Exchange requirements, the company 2005 is being reported for review, the main successor of the audit by the new agency accounting firm BDO mmm, Kelon Electrical Board of commitment to the Audit Committee composed.
3, 39 words Deloitte Kelon event of its crisis response to what
Source: Justice Network - Procuratorial Daily of: Tan Xiongwei Time :2005-08-09
in the China Securities Regulatory Commission released the findings of Kelon after August 3, before the audit of Kelon Electrical mm division of accounting firm Deloitte Touche Tohmatsu, ; and here for two days in the relevant contact Deloitte has been in no one answered the phone or hang up the state (according to the August 5, only a short response to the 39 words, and words where appropriate, is typical of the crisis public relations practices. because, as Gu Chujun Kelon arrest triggered the crisis, it is possible to Deloitte & Touche accounting firm in the world down with the famous. Deloitte Kelon in 2003 issued an unqualified audit report. As a senior accountant said: . role, if we Deloitte suffered a series of questions on this year to study business in crisis, and perhaps more meaningful.
since the outbreak in March this year, KFC, Nestle, Procter & Gamble hh the credibility of a series of international famous brands in China, hard hit. The audit report of Deloitte questioned, that the crisis is spreading to the service from the areas of product areas.
2001, due to the domestic market lost confidence in the domestic CPA industry, of the introduction of the world's five leading accounting firms (Arthur Andersen, PricewaterhouseCoopers, Deloitte, Ernst & Young, KPMG), the purpose is to play to their exemplary role, establish a standard of the Chinese accounting system, establish trade credit. But surprisingly, the Chinese government and the capital markets of the five well-known respected accounting firm, did not stick to their professional integrity. If KPMG in 2003 for suspected false statements in the case of Jinzhou Port, jointly and severally liable , and prosecuted by the Chinese investors. this Asian companies in the accounting firm to audit, the audit of a lower standard, while at the same time the accounting profession for its venerable reputation to sign audit reports, to give the illusion of healthy financial position, indicating that a number of firms did not In these areas the quality of service consistent with their charges.
Why KPMG and Deloitte good reputation in the developed countries, but a mere one million yuan to China's listed companies to harm the credibility of the audit fee to do? We can not help but think that the old fable, compliance costs low, are facing civil liability is almost zero. In such circumstances, the accounting firms are no longer stick to their ethics, not only as nature dictates corporate profits, the environment is inevitable.
Confucius once asked students: leverage. KPMG and Deloitte caught up in scandal, once again that large multinational companies to increase the supervision is necessary. If the Chinese market, the lack of basic control system and lack of supervision, then, even international reputation, such as Deloitte are may also become degenerate. I believe that more stringent regulation should be developed and the system of rules, for the violation and breach of professional conduct set high enough deterrent cost to fill the possible 4, the Deloitte Global credit crisis to hit the interests of Board (AIDB: Accountancy Investigation and Discipline Board) started the implementation of the global governance structure for tax avoidance, and has received additional compensation.
encountered, however this is only the latest example of Deloitte questioned. Because of Kelon Electrical (market reviews of information), financial reporting issues Gujinggong be involved in the vortex questioned. In particular, 28 July, the Ministry of Finance in the routine examination of accounting information quality bulletin, ordered PricewaterhouseCoopers rectification of the news office open later, sources said the Ministry of Finance is on the Big Four accounting firms in another investigation, has even questioned the market for Deloitte onto a new level.
We are very disappointed. is the best way.
Dunzou Kelon
7 mid-May, Shanghai lawyer Yan Yiming, accompanied by ZHU Shanghai Certified Public Accountants and the Hong Kong lawyers Andrew Lam, from an accounting perspective to 2002,2003,2004 Deloitte audit of Kelon questioned the financial statements.
audited by Deloitte & Touche Annual Fixed Kelon Electrical 2004 announcement that the year is expected to incur losses amounting to approximately 60 million yuan. in the performance correction notice, Kelon Electrical cited a total of four unforeseen reasons, and 71 million yuan for loss of profits attributed to the subsidiary of Huayi Compressor (market reviews of information) in the last few years of losses and claims, for which amortization has not yet completed on the difference between the whole of equity investment the amount of provision for the impairment. Soon, Huayi compressed May 12 statement, nothing to do with their loss.
Obviously, Kelon's financial statements and not convincing. For the 2002 audit bodies become Deloitte Touche Tohmatsu, even though in 2004, soon after the report disclosed withdraw, but the previous Kelon Electrical 2002, issued in 2004 retained earnings is clearly difficult to exemption audit report. The only time Deloitte issued Kelon Electrical , reported for fiscal 2003, unqualified audit report, Deloitte indicates that the earnings reflect a Kelon year financial position, operating results and cash flows, or disclosure should be adjusted and there are no major issues.
Deloitte issued for Kelon audit report 2004 earnings in the statement that show that China's accounting standards had never provided provision for sales returns, I do not know what the basis of Deloitte Touche Tohmatsu. a Deloitte employee to About Deloitte
Greencool Kelon Electrical and bank loans to other enterprises the situation, the Guangdong Provincial Banking Regulatory Bureau, and has all identified in the Deloitte report in Kelon obviously difficult to shirk responsibility. but is not yet professional regulatory bodies like the British Accounting Investigation and Discipline Board, as public surveys, Deloitte China's response is far from clear and the British sector.
Since then, though, including ZHU, including many local accountants in the media published a series of Deloitte's audit work is in Kelon questioned whether the duties, Deloitte's findings on disclosure of the former Kelon, always an ambiguous attitude. More people also questioned Deloitte Gujing issue earnings performance. Gujing is Deloitte customers in 2004, broke the 179 million earnings reports huge loss, and was 31 May 2005 within the statutory period for failing to disclose the financial report and initiate an investigation by the SFC.
is worth noting that Gujing Kelon has the same signature and the CPA, are partners in Shanghai Hu Fan. and it is, and Kelon, as were all engaged in the Mainland and Hong Kong, Deloitte Touche Tohmatsu, Deloitte Touche accounting firm Wong Tan & Fong conducted two audits, post by Deloitte in 1997 mm with Hong Kong's largest accounting firms accounting firms Kwan Wong Tan & Fong merge from.
Deloitte into China, particularly the expansion of the past three years the most violent .2003 November, Deloitte Global CEO White Bartlett in Beijing announced plans to invest over the next five years, at least $ 150,000,000, for the full expansion of business in China. The subtext is constantly in the local Chinese merger.
an important part of. respected by his professional reputation to attract business, then using lower standards of audit, and did not provide consistent quality of service with their charges.
particular, the acquisition of Pan-line in 2005 Deloitte accounting firm was faced when monitoring The problem resembles the way a lot of trouble. The original Beijing Pan-senior partner of accounting firm in China, Chen Jianming was long the Association of Certified Public Accountants CPA professional standards of work and responsible for formulating China's independent auditing standards, and even had served as a member of the Commission issuance examination committee.
Obviously, a Deloitte partner in Chen Jianming, its role can not only fight to a new Deloitte large customers, but also help to Deloitte in similar events in the crisis Kelon in paving the way for public relations. This is perhaps one of the reasons Deloitte ambiguous.
localization trouble
In fact, two of Kelon's financial report signed by certified public accountants Deloitte, in addition to Shanghai partner Hu Fan in addition, another partner Chen Huizhu Zhong Tian Qin used to be a partner in accounting firm, and transit handling the case had previously played in the Guangxia a very dishonorable role.
in charge of Kelon Deloitte audit work in Hong Kong. Kwan Wong Tan & Fong CPA is always causing trouble to the Deloitte .2004 Skyworth Digital chairman Huang Hongsheng and the number of persons by the ICAC investigation, involving false accounting records listed, Deloitte. Kwan Wong Tan & Fong is Skyworth auditors listing.
years, Deloitte. Kwan Wong Tan & Fong CPA in terms of Deloitte Touche merged with Kwan Wong Tan & Party before or after the merger, are involved in a number of related accounting scandal. of which the financial turmoil in Quang Nam Group problems before the most sensational accounts of the incident.
1998 10 months, the Group's financial problems Guangnan exposure, Deloitte. Kwan Wong Tan & Fong resigned in 1999, the work of Ren Guangnan auditor, KPMG issued a report at that time that the need for Quang Nam problem accounts for 3.8 billion provision, which required 2.4 billion recorded in 1997, including a flood in 1997, dead fish stocks. and Deloitte handling accounts, it is possible to automatic application on winding up, insolvency up to 40 billion .2001 June, Guang Xin Fang negligence against Kwan Wong Tan and recover damages, that Kwan Wong Tan Fang in 1994 to 1996 when the Guangdong International Trust and served as audit work, the existence of three years 1.9 billion identified by the auditors, false trading, the 1994 balance sheet, more 430 million yuan net loss was 130 million yuan by false earnings reports. widely believed that if the auditor can be made on the issue in a timely manner Some questions, or to avoid the subsequent loss of more than 20 million.
to industry sources, although Deloitte negotiations with Zhejiang Tianjian have not gone smoothly, but quite a lot of local accounting professionals are still willing to join foreign accountants affairs. The people in the industry pointed out to the magazine, on the one hand, the acquisition of local firm Deloitte generous decline in the quality audit result, on the other hand, possibly through the acquisition of Deloitte and local accounting elite to foreign investors about regulatory supervision of accounting firm, Deloitte strong localization
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