Kangmei crisis: huge debt, budget and sequelae of fraud
After more than a year, the administrative intervention and market ban of Kangmei Pharmaceutical (ST Kangmei) finally settled.On the evening of May 14, Kangmei Pharmaceutical announced that the company received the decision of the CSRC’s administrative judgment and the market ban, and the company was deviated from by the CSRC.At the end of April 2019, Kangmei Pharmaceutical made corrections to the 2017 annual report data when it released its 2018 annual report. Nearly 30 billion currencies and currencies mysteriously disappeared, eventually implicating the company’s successive years of financial fraud.In August 2019, Kangmei Pharmaceutical received the CSRC’s notice of administrative intervention and market ban.This once-famous white horse stock has now been changed by the SFC.For Kangmei Pharmaceutical, there will still be huge debts and a delisting crisis.The responsible person of Kangmei Pharmaceutical for years of financial fraud has been transferred to the lawyer of the judiciary: the shareholder litigation court can file a case “Kangmei Pharmaceutical has premeditated, organized, long-term, systematic financial fraud, trampling on the rule of law, and has no awe of the market and investorsThe “heart of fear” seriously damages the healthy ecology of the capital market.”This is a strict criticism of Kangmei Pharmaceutical Co., Ltd. in the violation and ban decision issued by the SFC on the official website on May 14.”The China Securities Regulatory Commission said that between 2016 and 2018, Kangmei Pharmaceutical’s falsely increased huge operating income, falsely increased monetary funds through counterfeiting and alteration of large fixed-term deposit certificates, etc. will not meet the accounting confirmation and measurement conditions.Increase fixed assets, etc.At the same time, Kangmei Pharmaceutical has non-operating funds occupied by the controlling shareholder and its related parties.The above-mentioned behavior caused false records and major omissions in the relevant annual report disclosed by Kangmei Pharmaceutical.According to the notice issued by Kangmei Pharmaceutical predicted by the China Securities Regulatory Commission, Kangmei Pharmaceutical had false records in the 2016 to 2018 annual report and the semi-annual report in 2018, which increased the operating income, revenue and operating profit.Among them, the “2016 Annual Report” falsely increased operating income89.9.9 billion yuan, “2017 Annual Report” falsely increased operating income by 100.3.2 billion, in the “Semi-Annual Report 2018”, the operating income increased by 84.8.4 billion yuan, “2018 Annual Report” falsely increased operating income16.1.3 billion yuan.According to preliminary calculations, Kangmei Pharmaceutical’s falsely increased operating income in the financial statements has exceeded 29 billion yuan in 3 years.Obviously, Kangmei Pharmaceutical’s semi-annual report in 2018, 2018 report, and 2017 report adopted financial non-accounting, false accounting, forgery, and alteration of large fixed-term deposit receipts or bank statements to match business income fraud.Falsified sales and sales rebates, etc., falsely increased monetary funds.Among them, Kangmei Pharmaceutical’s “2016 Annual Report” falsely increased monetary funds of 22.5 billion yuan, the 2017 Annual Report “falsely increased monetary funds of 29.9 billion yuan, and” 2018 Semi-annual Report “virtually increased monetary funds of 36.1 billion yuan.According to preliminary calculations, during the above reporting period, Kangmei Pharmaceutical Co., Ltd.’s falsely increased monetary funds totaled more than 88.5 billion.In addition, Kangmei Pharmaceutical also has false statements in the “2018 Annual Report”, false increase of fixed assets, construction in progress, investment real estate; “2016 Annual Report” “2017 Annual Report” and “2018 Annual Report”There are two other omissions of major omissions and failure to disclose the related party transactions of non-operating occupation of funds by shareholders and their related parties as required.In response to Kangmei Pharmaceutical’s financial fraud, the SFC finally made a stunning statement.The Securities Regulatory Commission said on May 14 that it has made administrative interventions and market ban decisions on Kangmei Pharmaceutical ‘s violations of laws and regulations, decided to correct Kangmei Pharmaceutical ‘s liability order, issued a warning, and imposed a 6 billion yuan fine on 21 people.Responsible personnel shall be fined from RMB 900,000 to RMB 100,000, and the six principal persons shall be banned from entering the securities market for 10 years to life.Relevant intermediaries are suspected of violations of laws and regulations are in the process of administrative investigation and review.At the same time, the SFC has transferred Kangmei Pharmaceutical and related personnel to the judicial organ for suspected criminal behavior.Lawyers from Zhejiang Yufeng Law Firm said to Sauna, Yewang that, according to certain circumstances, the person in charge directly responsible for Kangmei Pharmaceutical and other directly responsible persons were suspected of violating disclosure and not disclosing important information.In the end, the ruling of the judiciary shall prevail.”” After the filing of the Securities Regulatory Commission at the end of 2018, we pre-registered the investor’s budget. There were dozens of investors calling, and consulting and consulting fees, with personal expenses ranging from millions to millions.”We told reporters that we are currently reviewing responses in batches and conducting a commissioned litigation phase. The first batch of cases is scheduled to be submitted to the Guangzhou Intermediate People’s Court by the end of this month.”Lawyer Wu Lijun of Zhongwei 515.com, who represented Kangmei Pharmaceutical’s shareholder litigation, told reporters that he is currently representing hundreds of Kangmei Pharmaceutical’s shareholder litigation, and the issuance of the CSRC meeting’s announcement is of great significance to the lawsuit. “Because laws and regulations require that the Securities Regulatory CommissionThe case was only filed by the Administrative Law Enforcement Court, which led to the violation of laws and regulations that Kangmei Pharmaceutical had known for a long time.In 2019, the big change in performance, huge losses, huge losses, 36 billion repeated information violations, 2016 to 2018 after the disclosure of information fraud, Kangmei Pharmaceutical in 2020 5 years, Kangmei Pharmaceutical once again changed its face due to 2019 net profit, information leak violations were attacked.On May 10, Kangmei Pharmaceutical disclosed that due to information disclosure violations, the company and its chairman and general manager Ma Xingtian, chief financial officer Zhuang Yiqing, and board secretary Tang Xu received a letter from the Guangdong Securities Regulatory Bureau.As of January 23, Kangmei Pharmaceutical released the 2019 annual performance pre-loss announcement, disclosing that the company expects the net profit attributable to shareholders of listed companies in 2019 to be approximately 13.500 million to -16.500 million yuan.On April 30, Kangmei Pharmaceutical released its main operating performance report for 2019, disclosing that the reorganized net profit was revised to -36.4.8 billion yuan.The Guangdong Securities Regulatory Bureau stated that the 2019 net profit disclosed by Kangmei Pharmaceutical has changed after the amendment. The information disclosure of the restructuring performance forecast is not accurate.The relevant provisions of Article 2 and Article 25 decided to take administrative measures to issue warning letters to ST Kangmei and Ma Xingtian.Obviously, when ST Kangmei disclosed relevant data on its main operations in 2019, it received a regulatory work letter from the Shanghai Stock Exchange, which was also aimed at ST Kangmei’s performance “big face change”.In addition, although the time point for the listed company to disclose the 2019 annual report has passed, Kangmei Pharmaceutical has not yet re-published the 2019 annual report and audit report due to reasons such as the replacement of the audit institution.The title of Kangmei Pharmaceutical Co., Ltd. is that the newly hired audit agency Lixin has heavy audit tasks and time is tight, and due to the impact of the new coronary pneumonia epidemic, the company ‘s financial statements have been completed as scheduled, the time for auditing on-site duties, and the execution of important audit procedures have been seriously lagging.Before April 30, 2015, the annual report audit and the company’s 2019 annual report disclosure related work could not be completed.Short-term debt becomes long-term borrowing Kangmei still faces the outbreak of US $ 42.8 billion in financial fraud, bringing a series of effects to Kangmei Pharmaceutical, the most direct is the debt crisis.In January of this year, Kangmei Pharmaceutical’s 2.3 billion bond redemption repeated repeated breakthroughs. Kangmei Pharmaceutical also continuously disclosed in the announcement that the company raised funds through asset disposal and other means.According to the report of the first quarter of 2020 disclosed by Kangmei Pharmaceutical, the company had a long-term loan of US $ 12 billion and a short-term loan of 33 at the end of the long-term reporting period.9.8 billion yuan.You know, in early 2020, Kangmei Pharmaceutical’s short-term loan was 127.5.6 billion, with a long-term loan of 21.8.8 billion yuan.Kangmei Pharmaceutical weighed in. The reason for the change in short-term and long-term borrowings was mainly due to the fact that the company and the 13 banks with stock loans in the reporting period had multiple “stock loan syndicated contracts”, which would be converted into stocks for renewal and transferred to long-term loans.Such short-term debt becomes long-term borrowing. Although the short-term debt repayment pressure of Kang Kangmei Pharmaceutical can be reduced, until the end of January 2020, the total compensation of Kangmei Pharmaceutical will remain 428.8.7 billion, with an asset-liability ratio of 66%.In fact, Kangmei Pharmaceutical, known as the leading Chinese medicine concept, has been in existence for more than 20 years and has been on the market for more than 18 years.In the 2013 annual report, it has been described as “the first time to enter the top 500 Chinese companies, and it has been listed in the top 100 Chinese pharmaceutical industries for eight consecutive years.”Next, Kangmei Pharmaceutical will also face the risk of forced delisting.He said to Sauna and Yewang that Kangmei Pharmaceutical has been violated by the China Securities Regulatory Commission. According to the “Implementation Measures for the Major Illegal Delisting of Listed Companies by the Shanghai Stock Exchange”, the Shanghai Stock Exchange will make a decision based on the review opinions of the Listing CommitteeWhether to implement a major illegal violation of the company’s stocks.Sauna, Ye Wang Li Yunqi editor Wang Jinyu proofreading Li Shihui