For the annual report of the huge loss of RMB 13.8 billion in LeTV.com, the Shenzhen Stock Exchange sent an inquiry letter.
On May 9th, the Shenzhen Stock Exchange sent an inquiry letter on the 2017 annual report to LeTV.com (300104). In the letter, the Shenzhen Stock Exchange asked 33 questions and requested LeTV.com to combine the development of various businesses. This shows whether there is significant uncertainty in the company's continuing operations, combined with the company's current production and operation status and financial status, indicating whether the company may trigger a suspension of the listing due to negative net assets.
LeTV's 2017 annual report released on April 27 shows that in 2017, LeTV.com’s operating income was 7.025 billion yuan, a year-on-year decrease of 68%. The net profit attributable to the shareholders of the listed company was a loss of 13.878 billion yuan, a decrease of 2601.63% year-on-year. A stock company lost money in 2017.
LeTV.com's sharp decline in financial data of the company was attributed to the tight influence of the funds received from related parties. As a result, the advertising revenue, terminal income and membership income have been significantly reduced. The company also has a huge amount of assets that may be impaired. Loss provision.
The most noteworthy of LeTV's annual report was that Lixin Certified Public Accountants had an audit report that could not express opinions on April 26, and did not express an opinion on the financial report of LeTV.com.
In the inquiry letter of May 9, the Shenzhen Stock Exchange focused on issues such as the operating conditions of LeTV.com, accounting, related party transactions and related capital flows, and external guarantees.
In terms of operating conditions, the Shenzhen Stock Exchange introduced that as of the end of the first quarter of 2018, LeTV.com's net assets attributable to shareholders of the listed company was only RMB 004 million. The audit report also highlighted the major uncertainties related to the ability to continue operations. LeTV is requested to enter each item by type as of 2017, various types of liabilities, debt repayment plans, funding sources and financing arrangements, to indicate whether there is significant uncertainty in the company's continuing operations, and whether the company may trigger a suspension of the listing due to a negative net asset value. Situation.
In terms of accounting treatment, the Shenzhen Stock Exchange has also asked LeTV to comment on the project in which the accountants in the annual report of LeTV.com could not express their opinions, that is, details of bad debts other than the major accounts receivable owed by related parties.
In addition, regarding the scope of consolidation of financial reports, Shenzhen Stock Exchange Investment Management (Beijing) Co., Ltd. (the parent company of LeTV Financial System) has been transferred to Lemax to the new level under the Shenzhen Stock Exchange. The new wholly-owned subsidiary. Therefore, the Shenzhen Stock Exchange requires that the composition of the board of directors of LeTV Investments, the business decision-making process, etc., indicate whether the company actually controls LeTV Investments and whether it incorporates it into the consolidated statement.
The Shenzhen Stock Exchange also mentioned that LeTV Investment’s Chongqing LeTV Real Estate Development Co., Ltd. has two plots of land in Chongqing’s Liangjiang New District, requesting LeTV to explain the specific conditions and follow-up arrangements for the two plots; and requesting that LeTV’s investment be identified as Jia Yueting. The situation where its related parties provide funds.
It is worth mentioning that Shenzhen Stock Exchange found that the amount of capitalization of R&D expenditures of LeTV.com was 706 million yuan. At the same time, the number of R&D personnel significantly decreased. The Shenzhen Stock Exchange asked LeTV.com to specify the content of the company's R&D project and its progress, and whether it meets the conditions for capitalization. Whether there is a profit adjustment situation.
In terms of related party transactions and related party capital transactions, the Shenzhen Stock Exchange asked LeTV to explain the changes in the new sales channels and settlement methods since 2015, whether or not the company’s actual controller Jia Yueting invaded the listed company’s interests through related party transactions. The existence of a fictitious transaction verifies whether the company sells goods to related parties to achieve final sales. If yes, it indicates the flow of related funds, and whether there is a situation in which a related party maliciously misappropriates the interests of the listed company; if not, the quantity and reason of unrealized sales Whether there is a situation in which related parties cooperate with the company to increase its performance.
In addition to the above-mentioned actual business or financial level inquiries, the Shenzhen Stock Exchange has also inquired about the senior management of LeTV in the section on other matters.
The Shenzhen Stock Exchange mentioned that the announcement of the resolution of the 58th meeting of the third session of the Board of Directors of LeTV.com revealed that the directors, Liu Hong, were unable to make professional judgment because they did not understand the proposals reviewed by the board of directors and did not participate in the company’s daily operations. The content of the 2017 annual report, including the first quarterly report of 2018, abstained in all motions.
Shenzhen Stock Exchange asked Liu Hong to explain the specific reasons for not being able to make professional judgments, whether to fulfill the duties of the directors due diligence and loyalty, and whether they have the necessary knowledge, skills, and experience to perform their duties properly. The Shenzhen Stock Exchange also points to the most critical As for the actual controller problem of LeTV, Shenzhen Stock Exchange stated that Jia Yueting has appointed Gan Wei and Jia Yuemin to represent the shareholders of the listed company and perform the responsibility of the shareholders. It is solely responsible for handling the assets disposal and other related work. Shenzhen Stock Exchange requires LeTV to explain whether the above authorization requires The implementation of the information disclosure obligation in accordance with the "Measures for the Administration of the Acquisition of Listed Companies" will lead to changes in the actual controllers of the company. Please continue to supervise agencies to express their opinions.
According to the announcement, Shenzhen Stock Exchange requested that LeTV.com make a written explanation on the above issues, and submit the relevant statement materials to the management department of the GEM Board before May 18, and copy it to the Supervision Office of the Listed Companies of the Beijing Securities Regulatory Bureau.
It is worth mentioning that, since March 30th, the Shenzhen Stock Exchange has sent inquiry letters to LeTV.
Attachment: Inquiry Letter on Annual Report of LeTV Information Technology (Beijing) Co., Ltd. Enquiry letter of the GEM Annual Report '2018' No. 116
LeTV Information Technology (Beijing) Co., Ltd. Board of Directors:
In the review of the 2017 annual report of the company, the Ministry noted the following situations: I. About the company's operations
1. Since the second quarter of 2017, the company’s operating income and net profit have fallen sharply. By the end of the first quarter of 2018, the net assets attributable to the shareholders of the listed company was only RMB 004 million. The audit report also emphasized the relevance to the ability to continue operations. The major uncertainties of the company are: (1) Project-by-project year 2017, various types of liabilities such as company financing, borrowing, and operating transactions, including liability entities, liabilities, maturity, interest rates, interest burden, etc. Such as financing purposes, whether there is outstanding debt due; (2) in light of the company's assets and cash flow, explain the company's debt repayment plan, funding sources and financing arrangements, whether there is debt repayment risk and the countermeasures; (3 ) Combine the development status of various businesses and cash flow status to indicate whether there is significant uncertainty in the company's continuing operations; (4) Incorporate the company's current production and operation status and financial status, and indicate whether the company may trigger a suspension of listing due to negative net assets. situation.
2. During the reporting period, the company’s advertising business revenue was 5.01 billion yuan, which was lower than the same period of last year
87.39%. Please your company: (1) Combine the changes in the number of advertisers and advertising revenues in different business models in the last three years, the competitive position in the market, the reasons for the sharp drop in advertising business revenue, and the measures for future operations improvement; The customer case details your company's advertising replacement business, advertising rebates business, withdrawal of orders after placing advertisements, accounting treatment under special circumstances such as advertising effectiveness settlement, and the occurrence of the above-mentioned special circumstances in the last three years, including advertisers, specific cooperation methods. Contents, content of advertisements, income confirmation amount, accounts receivable collection and provision for bad debts, etc. Please provide relevant contract documents; (3) Ask the accountant to give clear opinions on the above matters.
3. During the reporting period, the company’s copyright business income was RMB 912 million. Your company: (1) Describe the company’s accounting treatment of the copyright distribution business, copyright swap business, and whether it has changed in the last three years; (2) provide the most recent Details of copyright distribution business and copyright swap business for three years, including customer name, cooperation content, revenue confirmation amount, cost confirmation amount, receivables recovery and provision for bad debt provision, etc., and provide related contract documents; (3 ) Ask the accountant to give a clear opinion on the above matters.
4. During the reporting period, the company's revenue from paid services was 2.128 billion yuan, which was a decrease of 62.00% from the same period of last year. Your company: (1) Explain quarterly the number of subscribers paying for the service in the first quarter of 2017 and 2018, average payment amount and renewal Rate, the proportion of income of new users and stock users in the paid service; (2) Combining the changes in the key indicators such as the traffic volume of the company's website and the number of people covered in the last three years, indicating whether the sticky and stable expression of the company's website users is accurate.
5. The company's subsidiary Levision Cloud Computing Co., Ltd., LeTV (Tianjin) Information Technology Co., Ltd.'s 2017 net profit were -1.672 billion yuan, -1.835 billion yuan, both dropped significantly compared with 2016; net assets were - 177 million yuan, -1.058 billion yuan, and the net assets were positive at the end of 2016. Please your company: (1) Explain the reasons why the operating income of the two subsidiaries has not dropped sharply, and the reason for the substantial loss of net profit, whether there are cross-cost costs (2) explain the changes in the assets of the two subsidiaries and the reasons for the negative net assets; (3) explain whether there are major uncertainties in the continuing operations of the two subsidiaries and the possible impact on the listed companies; (4) Ask the accountant to give a clear opinion on the above matters.
Second, on the accounting treatment
(1) Matters Concerning Accountants Cannot Express Their Opinions
6. As of December 31, 2017, the company provided bad debts for accounts receivables and other receivables that were not expected to be repaid except for some other individually significant accounts receivable and individual amounts. Preparations. According to the audit report, the company did not provide a specific basis for its accrual ratio and did not provide sufficient basis for the above assessment of the reclaimability of the remaining receivables. Your company: (1) Explain that the company is expected to be unable to repay other than related parties. Of other accounts receivable that are individually significant in amounts and details of accounts receivable and other receivables that are insignificant individually, including the arrears, goods or services sold, revenue confirmation in the most recent three years, amount receivable And the age of accounts, the accrual ratio and its confirmation basis, the basis for the recovery of remaining accounts receivable, and the verification of the authenticity of the relevant transactions and accounts receivable amount, the reason for the large amount of bad debt provision and its reasonableness, and whether there is adjustment (2) Your company stated that 'the company has adopted the necessary policies to ensure that all sales customers have a good credit history. The company has no other than the amount owed by the related party in the accounts receivable amount. “Concentrated credit risk”, please explain the policies and measures taken by the company to ensure that the sales customer has a good credit record. The above statement is inconsistent with the company's accrual of large bad debt provision; (3) Other single major other receivables - The balance of advertisements is RMB 427,806,300. The bad debt provision is accrued according to the age group. Please explain the name of the unit of the receivables, the transaction contents, and the historical transaction status of the company. Withdrawal of bad debt provision according to the aging combination. Proportion and rationality, post-recovery situation, and explain the differences and reasons for the proportion of bad debts with other receivables of the same type, and whether there is profit adjustment; (4) Explain how the company does not provide accountants with the proportion of accruals Based on the above, the specific reasons for the sufficient basis for the assessment of the remanufacturability of the remaining receivables are as follows; (5) Explain whether there are obvious violations of the accounting standards for the above-mentioned provision for bad debts. The amount of impact on the company’s financial report is expected to eliminate the impact. Possible and time.
7. The ending book value of the company's intangible assets was 12.869 billion yuan, the new amortization was 3.084 billion yuan, and the newly accrued impairment provision was 3.285 billion yuan. According to the audit report, sufficient evidence of impairment was not available. At the time of occurrence, judgments cannot be made to determine the reasonableness of the income forecast in the impairment test. Please your company: (1) Combine the accounting treatment for copyright amortization in the same industry and the large provision for impairment of the current period. The situation shows that the accounting estimates for amortization of film and television copyrights according to the “delegation period or 10 years” are appropriate; (2) The accumulative amortization of intangible assets at the beginning of the period was RMB 3.351 billion. This year, RMB 3,084 million was accrued. Please verify the amortization during the year. If the policy changes, if so, explain the reasons and the procedures for performing the review; if not, please combine the amortization details of intangible assets over the years, the changes in intangible assets during the current year, and explain the reasons for the significant increase in amortization during the year; (3) The period decreased by RMB 1.419 billion. Please explain the details of the copyright of expired film and television, the reasons for the absence of expired film and television copyright in the previous year, the accounting treatment related to the expiration of copyright, and the amortization of movie and television copyright in previous years. Whether the accounting treatment is compliant; (4) Please combine the characteristics of the company's intangible assets, the basis for judgments when the signs of impairment occur, and the process of impairment testing. Explain the categories of intangible assets, the amount of assets, the amount of impairment, and the amount of deductions. The reason for the value and the adequacy of the impairment; (5) Explain the company's selection process for the intangible assets' impaired income forecast parameters, and explain that the above parameters are selected when the series of programs described in 'Continuity Management' have not yet been completed. Rationality; (6) Explain the amount of impact on the company's financial statements in the above-mentioned matters, whether there is a clear violation of the accounting standards, and it is expected to eliminate the possibility and time of impact.
8. The CDN and bandwidth charge of your company's operating costs was 1.474 billion yuan, an increase of 540 million yuan year-on-year. The balance of the accounts payable-service provider at the end of the period includes the provisional amount of undiscounted costs incurred. The audit report states that the company Failure to provide sufficient evidence for the provisional basis of these costs and costs. Your company: (1) To explain why the company's main business was significantly shrinking in 2017, the reasons for the substantial increase in CDN and bandwidth costs, and the rationality; and 2018 The rationality of the discrepancy between the decline trend of CDN fees in the first quarter and the 2017 year-on-year trend; (2) Comparing the 2016 and 2017 CDN and broadband billing methods, explains whether the company’s accounting treatment of CDN and broadband fees has changed and whether there is a cost (3) Explicit details of the undiscounted costs incurred above, including the time of occurrence, amount, commercial nature, provisional basis, etc.; (4) Explain that the company's provisional basis for the above-mentioned cost is not Reasons for providing sufficient evidence; (5) Explain that the above cannot express the amount of influence of opinion items on the company's financial statements, and whether there is a clear violation of accounting standards Love shape, and could be expected to eliminate the effects of time.
Please continue to supervise institutions and accountants to express their opinions on the above 6 to 8 matters, and ask the accountant to explain the audit procedures that have been executed, the audit process, and the reasons why sufficient and appropriate evidence could not be obtained.
(II) Related issues of asset impairment
9. The book balance of available-for-sale financial assets at the end of the period is RMB 1.594 billion. For Levision Chuangjing Technology (Beijing) Co., Ltd. (hereinafter referred to as 'LesVision'), Coolpad Group Co., Ltd., Shenzhen Super Multidimensional Technology Co., Ltd. (hereinafter abbreviated as 'Shenzhen Super Multidimensional' ) The three companies' equity provision for impairment is RMB 850 million. Please contact the company: (1) Combine the operation status of related participating companies, impairment testing methods and parameter selection, etc., stating that the equity of other participating companies is not accrued The rationality of the impairment provision; (2) In combination with Shenzhen Chaowei Multi-year 2017 operating situation, the impairment testing process explains the reasons and adequacy of the provision for impairment provision; (3) Describes the equity structure of Shenzhen Chaowei, whether it is There is an associated relationship with Jia Yueting, whether there is capital occupation of related parties; (4) Ask the accountant to give a clear opinion on the above matters.
10. In 2017, Hua Ying’s film and television industry realized a net profit of RMB 58.39 million, which was far lower than RMB 120 million in 2016. However, your company has not made provision for impairment of its goodwill. Please combine your company with the impairment test of goodwill. The specific method, test procedure, parameter selection, etc., indicate whether the provision for impairment of goodwill is not considered to be reasonable, and asks the accountant to express their opinions.
(III) Problems with the Consolidation of Financial Reports
11. The company's wholly-owned subsidiary, Beijing Le Stream Media Advertising Co., Ltd. (hereinafter referred to as 'Le Stream Media') and Shenzhen Xingen Investment Fund Management Co., Ltd. (hereinafter referred to as 'XinGen Capital') set up the Shenzhen Levision Xingen M&A Fund. Investment Management Enterprise (Limited Partnership) (hereinafter referred to as 'Lokse M&A Fund'). Invite your company: (1) Combine the management and decision-making mechanism of the fund, the rights and obligations of the fund partner, the income distribution mechanism, etc. Whether the fund has actual management rights or control rights and the accounting treatment of the industry's merger and acquisition fund, and requires the accountant to check and publish clear opinions; (2) LeTV's M&A fund invests in RMB 300 million in LeSce Vision, LeSports Vision and Music Vision In 2016, the controlling company incurred a capital borrowing of RMB 340 million. Please explain whether the above-mentioned borrowing activities constitute the use of funds by related parties, the measures already taken by the fund manager and the measures to be taken by the fund manager; (3) December 21, 2017, the Manager The company paid the expected fixed income of RMB 206 million to its senior partner, Wuhu Gofei. Please cooperate with the fund's terms of cooperation, and explain the payment. The reasons and rationality of the fixed income mentioned above are the basis for calculating the expected fixed income.
12. LeTV Investment Management (Beijing) Co., Ltd. (hereinafter referred to as “LTV Investment”) has transferred to Lefluxon New Electronic Technology (Tianjin) Co., Ltd. (hereinafter referred to as “Leverage to New”) at the industrial and commercial record level. In terms of structure, it became a wholly-owned, wholly-owned subsidiary of Lefusion. Your company: (1) Incorporating the composition of LeTV's board of directors, business decision-making procedures, etc., to indicate whether the company actually controls LeTV Investments, whether it is included in the consolidated statement; Status, assets, indicating that the estimated value of Letv Investment is RMB 1.4 billion, assessing the progress of the work and expected completion time; (3) media reports said that LeTV's Chongqing Levision Real Estate Development Co., Ltd. is located in Chongqing Liangjiang New District With two plots of land, please state the specific conditions and follow-up arrangements for the two plots of land; (4) Whether or not the financial services business of LeTV Investment has obtained the qualification of Internet insurance brokerage business. If it has been obtained, please explain the subject who has the qualification of internet insurance brokerage business. Time of acquisition, development of related businesses, etc.; (5) whether LeTV Investment has provided funds for Jia Yueting and its affiliates, if any , Please explain whether it complies with the relevant laws and regulations; (6) Please continue to supervise the organization and the accountant shall issue opinions on the above issues.
(4) Other accounting issues
13. The capitalization amount of R&D expenditures of the company was RMB 706 million. At the same time, the number of R&D personnel was significantly reduced. Your company: (1) Describe in detail the contents and progress of the company's R&D project, whether it meets the conditions for capitalization, and whether there is profit adjustment. , ask the accountant to give a definite opinion on the above matters; (2) Please explain that the R&D personnel greatly reduce the impact on the company.
14. The balance of prepaid copyright in other non-current assets of your company is RMB 972 million. Please ask your company to: (1) list the counterparty of the prepaid copyright, whether it is a related party, purchase the copyright name, copyright term, age Structure and settlement period, settlement method, etc., and verify whether there is a related party's capital occupation; (2) Please continue to supervise the agency and the accountant to express their opinions.
15. The company’s estimated debt is RMB 340 million, which is due to the possibility of unsuccessful litigation losses. Please combine the company’s progress in litigation, guarantees and repurchase obligations, and explain the accounting policies for accrued liabilities, as of the end of the reporting period. 4. Make sufficient provision, and ask the accountant to give a clear opinion.
16. The balance of company's inventory items was 828 million yuan, and provision for falling prices was 224 million yuan. In addition, the company's management expenses included 196 million yuan worth of inventory loss. Your company: (1) According to the product category, the inventory of inventory stock Age, amount, inventory falling price preparation test process and accrual; (2) explain the specific contents of damaged inventory, cause of damage; (3) ask the accountant to express their opinions.
17. The advertising promotion fee in your company's sales expenses was RMB 927 million, an increase of RMB 390 million year-on-year, and the cash flow statement items showed that the actual advertising production fee paid during the reporting period was RMB 151 million. Please Company: (1) Explain the composition of advertising promotion production fee, the reasons for the significant increase in the reporting period, whether there are inter-period expenses, (2) Combining advertising promotion and production methods, payment time, etc., Explaining the actual paid advertising promotion production costs and sales expenses The reasons for the large differences in the production expenses for advertisement promotion in China; (3) Ask the accountants to express their opinions.
18. The salaries and benefits of your company's operating costs and management fees were 514 million yuan and 239 million yuan, respectively, which represented a slight increase year-on-year. Your company: (1) Explains the sharp drop in the number of employees, and the reason why the amount of wages and benefits did not decline. (2) The individual income tax is subject to tax payment of RMB 230 million at the end of the period. Please explain the progress of personal income tax payment as of the end of this year. Is there any case that has been withheld but not paid by the time? Is there any risk of administrative penalties?
19. The top five other receivables of the parent company are all subsidiaries within the scope of the consolidated statement. The total balance of other receivables receivable is RMB 5.194 billion, and provision for bad debts is RMB 3.062 billion. Please refer to the company for related fund flows and uses. , Explain the reasons for the large provision for bad debts in the scope of the consolidated statement, and the basis for the determination of the accrual ratio, and verify whether there is any use of related party funds.
20. The opening balance of deferred income tax assets of your company is RMB 650 million, and the deductible temporary difference is RMB 2.602 billion. The ending balance is all 0. Please state the details of the temporary differences that can be deducted at the beginning of your company description. Whether the specific reasons for the reversal indicate whether the relevant subsidiaries are expected to suffer long-term losses and verify whether the deferred income tax assets are recognized as prudent at the beginning of the period and whether they meet the requirements of the accounting standards. Please ask the accountants to express their opinions.
21. At the end of the reporting period, the input tax to be deducted from your company was RMB 968 million. Please explain the reason for the input tax to be deducted, the accounting basis and its specific composition.
To sum up the above 6-21 questions, please verify whether the company has made provision for impairment, bad debt provision, estimated liabilities, etc., if there is any adjusted profit in the reporting period, to avoid the situation that the company's net assets are negative, and to combine the impairment losses of subsequent assets. 4. Accrued plans and arrangements, verifying whether the company may trigger a negative net asset in 2018.
Third, on related party transactions and related party funds transactions
22. During the reporting period, the sales amount of your company to LeTV Intelligent Terminal Technology Co., Ltd., LeTV Holdings (Beijing) Co., Ltd., LeSport Mobile Intelligence Information Technology (Beijing) Co., Ltd. (hereinafter referred to as “L&E Mobile”) reached 3.699 billion yuan. Yuan, which accounted for 52.65% of the total annual sales, related party accounts receivable balance at the end of the period was approximately 4.757 billion yuan, mainly because the company sold hardware products such as Daping to non-listed system affiliates, and provided advertisements, membership, and cloud services. Please your company: (1) Explain the changes in the new sales channels and settlement methods since 2015, reasons for change, rationality and necessity, whether there is any situation in which the company’s actual controller, Jia Yueting, used related party transactions to infringe on the interests of listed companies. Whether there is a fictitious transaction; (2) list the sales information of the company to related parties in the most recent three years, purchase goods, provide services, and accept the specific content and pricing basis of labor services, and compare with similar products or services in the market to illustrate the pricing of related transactions. (3) verify whether the goods sold by the company to related parties achieve the final sales, and if so, explain the relevant funds And whether there are any cases in which the related party maliciously misappropriated the interests of the listed company; if not, the quantity and reason of the unrealized sales, whether there is a case in which the related party cooperates with the company to increase its performance; (4) large amount of receivables in related parties If the item cannot be recovered, the reasonableness and necessity of the large amount of related transactions continue to occur during the reporting period, and the company’s safeguard measures for the money recovery; (5) Explain the recovery of the accounts receivable of the related party at the end of the period so far. And the proposed measures.
23. The closing balance of other receivables of related parties of your company is approximately RMB 1.203 billion, of which RMB 424 million is due to the company’s prepayment of mobile payment to LeEco Mobile E-commerce (Beijing) Co., Ltd. (hereinafter referred to as “LTV”). Receipt calculations. The remaining balance is due to the adjustment of estimated liabilities and the capital flow between the company and the unlisted system affiliates and the payment of wages. Your company: (1) Incorporating industry practices, LeTV's production status, Explaining the prepayment of LeTV Reasons and rationality of the large amount of mobile phone payment, Leh’s judging basis for the performance ability of the mobile phone, and whether it is the use of funds of related parties; (2) Details of adjustments of estimated liabilities in other receivables, including matters involved, reasons for accrual, estimated liabilities The basis for the confirmation of the amount and its accrual ratio, the reason for other receivables and the basis for future recyclability; (3) the end of the period for LeTV Mobile, LeTV (Beijing) Co., Ltd. (hereinafter referred to as “LTV”), The revenue receivables from Lepa Marketing Services (Beijing) Co., Ltd. were 221 million yuan, 150 million yuan, and 88 million yuan respectively, indicating the business content generated by the incoming payment. Parties of funds used.
24. The ending balance of your company's affiliates in 2017 was approximately RMB 560 million, mainly due to the company’s purchase of hardware from non-listed affiliates, copyrights, and other advance payments. Your company: (1) Explain the above prepayments The specific details, including the time of occurrence, the amount incurred, the content of the procurement and the progress made so far; (2) According to the industry practice, the rationality of the payment of large amount of related party's advance payment, whether it constitutes the use of funds of related parties; (3) Whether the matter has fulfilled the corresponding approval process.
25. In the year of 2017, the company issued loans and advances totaling 384 million yuan, and accrued impairment provision of 324 million yuan. Among which, related parties issued loans and advances of 295 million yuan, mainly due to the non-listing of subsidiary companies of the company's small loan companies. System-related companies provide financial services. Please explain: (1) The business model and profitability model of microfinance companies, and the operating conditions of the last three years, whether their risk control measures are in line with relevant regulations of the People's Bank of China, the China Banking Regulatory Commission, and so on; (2 ) Sources of funding for loans or advances made by the above-mentioned companies, loan targets, time of release, time of repayment, amount of loans, reasons for depreciation, and basis for confirmation of the proportion, risk control measures taken prior to granting loans or advances, and maturity Whether the recovery measures taken constitute the use of funds of related parties; (3) Whether the above-mentioned related transactions have fulfilled the corresponding approval procedures and information disclosure obligations.
26. The number of non-operating funds at the beginning of your company's related parties in 2017 was 431 million yuan, the new amount was 1.559 billion yuan, and the ending balance was 931 million yuan. Please check with your company: (1) Verify whether the company has been with the company before 2017. LeEco’s e-commerce has a related party’s capital occupation. If yes, please specify the time, amount, and reasons that were not disclosed in previous years; (2) Describe whether the company and controlling shareholder and actual controller are independent in terms of personnel, assets, and finances. , Background and progress of the above-mentioned separation of independence; (3) Demonstrate the payment of wages for the continuation of the company's and non-listed systems, the amount and reason for the social security's details; (4) The company's arrears and the introduction of domestic suppliers with affiliates The reasons and details of the capital transactions between investors and investors; (5) The newly added party's capital accounted for 17.21 million yuan in the first quarter of 2018. Please explain the specific reasons; (6) Explain the rectification measures and timetable of the related party's fund occupation. .
Please continue to supervise institutions and accountants to verify the issues involved in the above questions 22-26, and express their opinions.
Fourth, on the external guarantee
27. The annual report disclosed that if Levision Sports Culture Industry Development (Beijing) Co., Ltd. (hereinafter referred to as 'L&S Sports') could not be listed before December 31, 2018, Levision Cloud Computing Co., Ltd. (hereinafter referred to as 'LeTV') could not In 2016, 2017, and 2018, if you complete contracted business indicators or be listed in early 2019, your company will have large repurchase responsibilities. Subsidiary Le Rongzhixin moves to LeTV Mobile, Lesai Mobile to Heshuo Alliance. The sum payable is 35.405 million US dollars. Jointly assume the liability. Your company: (1) To verify the company’s specific amount of responsibility for large-scale repurchase of LeTV Sports Shareholders in conjunction with the terms of the relevant agreement; (2) Explain the signing of the above security agreement. Implementation of the internal approval procedures, the company did not perform the reasons for the board of directors, the shareholders of the proceedings; (3) explain the legal effectiveness of the agreement, and may have an impact on the company, and asked the lawyer to express their opinions; (4) to verify whether the company has other The controlling shareholder Jia Yueting and its affiliates, other companies or natural persons to provide guarantees; (5) Please continue to supervise agencies to express their intentions on the above matters. see.
V. Other matters
28. The announcement of the resolution of the 58th meeting of the third session of the Board of Directors of the Company disclosed that the director Liu Hong was unable to make professional judgment because he did not understand the proposals reviewed by the board of directors and did not participate in the company's daily operations. Therefore, he included the 2017 fiscal year. The contents of the report, the first quarterly report of 2018, abstained from voting in all resolutions. Liu Hong resigned from the post of deputy general manager on December 15, 2017, and still served as vice chairman. Please ask Liu Hong to explain one by one that professional judgment cannot be made. The specific reasons for whether to perform the duties of the directors due diligence and loyalty, and whether they have the necessary knowledge, skills and experience to perform their duties properly.
29. Jia Yueting has appointed Gan Wei and Jia Yuemin to represent the rights of shareholders of listed companies and fulfill shareholders' responsibilities. They are solely responsible for dealing with asset disposal and other related work. Your company: (1) Explain whether the above authorization should follow the “Measures for the Acquisition of Listed Companies”. Whether the fulfillment of information disclosure obligations leads to changes in the company's actual controllers, please continue to supervise agencies to express their opinions; (2) As of now, your company's measures for the resolution of Jia Yueting and its related party's large debts, and related work The progress of the situation.
30. Your company disclosed on March 31, 2017 that in order to resolve interbank competition issues involving Mr. Jia Yueting, the controlling shareholder of the company, and his spouse, Gan Wei, it is planned to acquire a 47.8261% stake in Beijing Leyi Film & TV Media Co., Ltd. held by Gan Wei. Your company explains the progress of the above acquisition, follow-up work arrangements and completion time.
31. In early 2017, your company did not pay rental fees to Dr. Peng Peng Telecommunications Media Co., Ltd. (hereinafter referred to as 'Dr. Peng') as scheduled. As a result, the data of the advertising analysis business before July 18, 2017 was lost and could not be recovered. Please your company: (1) Explain the specific impact of the loss of advertising analysis business data on the audit of the company; (2) Explain that the company has not made payment after Dr. Peng has made multiple dunning and has not taken effective measures to back up the advertisement analysis database. (3) Explain whether the above-mentioned business data is subjectively malicious, investigate the matter and related investigation results; (4) Please continue to supervise the agency to verify and express opinions.
32. According to the “Securities Industry in the Shenzhen Stock Exchange Information Disclosure Guidelines No. 6 – Listed Companies Engaged in Internet Video Business”, please add the core business data and operations of the 2017 Internet video, indicating the company’s competitive position in the industry.
33. During the reporting period, the company’s multiple bank accounts and subsidiaries’ equity were frozen by the judiciary, involving a book value of RMB 2.072 billion. Please explain whether the above-mentioned matters have met the criteria for temporary information disclosure and whether they have fulfilled their obligation of information disclosure in a timely manner.
Please ask your company to provide written explanations on the above issues and submit the relevant explanatory materials to our Ministry before May 18, and copy the information to the Regulatory Office of the Listed Companies of the Beijing Securities Regulatory Bureau. Hereby, hereby express the letter of this letter. The Management Department of the Growth Enterprise Market Corporation May 1818, 2018 day