The annual report of LeTV.com was asked 33. Is it profit adjustment?
The annual report for four consecutive years was inquired; data on advertising fees fought; large amounts of bad debts were asked if there was profit adjustment
After being presented with the 'Unable to express opinions' audit report, LeTV's annual report was re-inquired. This is the fourth consecutive year that LeTV.com has been inquired.
On May 9th, in response to the 'Non-standard' annual report of Levision’s huge loss of RMB 13.8 billion in 2017, the Shenzhen Stock Exchange issued a total of 33 inquiries on LeTV. In the inquiry letter, the reason for the large amount of provision for impairment provision was reasonable. Sexuality is mentioned, and whether there is a case of adjusting profits has also been mentioned several times. Its 2017 annual report shows that the company's total provision for impairment of assets reached 10.882 billion yuan.
In addition, in the inquiry letter, the Shenzhen Stock Exchange also asked LeTV to indicate whether the company may trigger a suspension of the listing due to a negative net asset. As of the end of 2017, its net assets were 663 million, a year-on-year decline of 93.52%.
As of the close on the 9th, LeTV.com's stock price was 4.41 yuan, down 3.29%.
Inquiries for four consecutive years of annual reports: Will it lead to suspension of listing
LeTV.com received an inquiry letter from the Shenzhen Stock Exchange on the 9th. Shenzhen Stock Exchange asked LeTV.com to answer 33 questions in its 2017 Annual Report. This includes asking the company to list each item as of 2017, corporate financing and borrowing, and business transactions. Debt situation, explain the company's debt repayment plan, sources of funds and financing arrangements, whether there is debt repayment risk and countermeasures, explain whether there is significant uncertainty in the company's continuing operations, indicate whether the company may trigger the suspension of the listing due to the negative net assets Wait.
The 2017 annual report disclosed that LeTV's net profit was a loss of 13.878 billion yuan, becoming an A-share 'loss-making king'. The company's 2017 annual report was also issued by the Ericsson Certified Public Accountants with an 'unable to comment' audit report.
The audited organization's annual report on 'unable to express opinions' is generally considered to have very serious problems. The relevant companies will be given special attention by the supervisors. LeTV has failed to obtain auditors' standard unqualified audit reports for two consecutive years, 2016 The annual auditing institution has given an 'unqualified opinion with emphasis on matters' around the related transactions.
This year has been LeTV.com's annual report for four consecutive years by regulatory authorities. When LeTV announced its 2016 performance forecast, it claimed that net profit increased by 30% year-on-year, but the annual report on April 19, 2017 showed 'negative growth'. After increasing to pre-reduction, Shenzhen Stock Exchange made 16 questions in a row, requesting LeTV.com to make payments, prepayments and related transactions, future performance forecasts, R&D expenses and personnel, industry data, and cash flow. Detailed disclosure, where related transactions and performance forecasts are the focus.
In fact, the Shenzhen Stock Exchange has started to inquire about related transactions and other contents since LeTV's 2015 financial report was announced. In the last of the six issues of the year, it asked that LeTV be associated with related parties like LeTV, LeTV Mobile and LeTV. The specific content of the transaction, and a comparison of the pricing of the company and non-related party transactions. In the inquiry letter for the 2014 financial report, the seven issues listed by the Shenzhen Stock Exchange mainly focused on the specific terminal business, advertising services, payment services, etc. Expand.
Whether adjusting profit is 'concerned'
From the inquiry letter, the matters concerning the inability of the accountant to express opinions were also highlighted.
As of December 31, 2017, the music network for not expected to repay a portion other than related parties with significant single amounts of other receivables and are not individually significant accounts receivable and other receivables provision for bad debts the audit report said the company did not provide specific provision for proportional basis, also did not provide a sufficient basis for the above-mentioned remaining accounts receivable recyclability assessment.
Inquirer said the letter, please indicate the company did not provide a specific basis for the provision of proportion to the accountant, the specific reasons a sufficient basis for the assessment of the recoverability of the remaining accounts receivable.
The Shenzhen Stock Exchange also requested to explain the accounts receivable that are expected to be unable to be repaid except for the related parties, and the details of receivables and other receivables that are individually insignificant, including the arrears, sales Commodity or service, revenue confirmation in the last three years, amount receivable and ageing, ratio of accrual and its confirmation, basis for recoverable remaining accounts receivable, and verification of the authenticity of related transactions and amounts of accounts receivable, The reason for the large amount of bad debt accruals and its reasonableness are whether there is any adjustment of profits.
As early as the LeTV online monthly announcement was released, the auditor stated that auditors could not express their opinions on the provision for bad debts that may have been accrued. This may be due to the excessive provision of bad debts by the company, which is suspected of manipulating to reduce current profits, which is commonly known as 'washing'. Big shower'.
The reporter noticed that in successive years of inquiry letters, R&D investment has been given special attention. According to public disclosure, since 2010, the amount of company development expenditure has increased from 5.37 million yuan in 2010 to 731 million yuan in 2015. In 2016, LeTV.com's R&D investment amounted to 1.86 billion yuan. LeTV.com was asked to supplement the reasons for the significant increase in R&D personnel in 2016, and the reason why the company’s employees' professional composition changed significantly compared to 2015.
In 2017, the capitalization of the company’s R&D expenditures was 706 million yuan, and the number of R&D personnel was significantly reduced. This was requested by the Shenzhen Stock Exchange: Describe the contents of the company's R&D projects and their progress, whether they meet the conditions for capitalization, and whether there is profit adjustment.
Annual report questions frequently, a company was investigated
According to statistics, since the beginning of this year, the annual reports of more than 200 companies in the two cities have been inquired, including LeTV, which has been interviewed for four years.
On January 31st, Fushun Special Steel issued an announcement that due to self-examination, it was discovered that the existence of physical assets such as inventory is not true. If the company's 2017 audited net profit attributable to the shareholders of the listed company was negative, and because the physical assets were not If the company experiences continuous losses after retrospective adjustment of real issues, or if the net assets in 2017 and previous years are negative (finally based on the disclosed annual report), the company's shares may have warnings of delisting risk, suspension of listing or termination of listing. risks of.
On March 21st, Fushun Special Steel received a notice of investigation from the Securities Regulatory Commission. Due to the company's suspected breach of trust, the CSRC investigated Fushun Special Steel.
In addition, due to the company's investigation of the annual report problem before 2017, this includes Whirlpool.
focus
Is there a 'big bath' situation?
In the annual inquiry letter of LeTV, the regulatory agency asked 33 questions concerning the specific conditions of various businesses. Before that, the industry questioned whether the “big bath” situation was also noticed by the regulatory authorities.
Specifically, look at the contents of the inquiry letter, including requesting to explain the reasons for LeTV.com's two subsidiaries, Levision Cloud Computing Co., Ltd., LeTV.com (Tianjin) Information Technology Co. Whether there are inter-period adjustments of expenses; explain the details of receivables other than related parties, and verify the authenticity of relevant transactions and accounts receivables, reason for the large provision for bad debts, and reasonableness, and whether there is profit adjustment situation.
The inquiry letter also asked for the reason and rationality of the significant increase in CDN and bandwidth fees in 2017 when the company’s major business was shrinking. Compared with the 2016 and 2017 annual CDN and broadband fee settlement methods, the company’s CDN and broadband were explained. Whether there is any change in the accounting treatment of the fee, whether there is a situation in which the cost and cost will be cross-periodic.
In addition, the inquiry letter also paid attention to R&D expenditures. Is the advertisement fee reasonable? The advertising promotion fee for the sales expenses is 927 million yuan, an increase of 390 million yuan over the same period of last year. The cash flow statement shows the amount of advertisements actually paid during the reporting period. The fee was 151 million yuan, which was required to explain the reasons for the large difference between the actual paid advertising production fee and the advertising promotion production fee in the sales expense; the composition of the advertising promotion production fee, the reason for the significant increase in the reporting period, and whether there was a Cross-period expenses.
Large-scale related-party transactions remain the same, whether it is a result
Related-party transactions are still the focus of the regulatory authorities. Significant related-party transactions still exist. LeTV.com's sales to LeTV Smart, LeTV Mobile and other related parties amounted to 3.699 billion yuan, accounting for 52.65% of the total annual sales, related parties should collect The balance at the end of the period was approximately 4.757 billion yuan.
The inquiry letter asks to verify whether the products sold by LeTV to related parties are ultimately sold. If yes, it indicates the flow of related funds, whether there is a situation in which the related party maliciously misappropriated the interests of the listed company; if not, the quantity and reason of the unrealized sales are explained. Whether there is a situation in which related parties cooperate with the company to increase performance. The inquiry letter also requires that, in the event that large amounts of receivables of related parties cannot be recovered, the rationality and necessity of continuing large-scale connected transactions in the reporting period.
analysis
LeTV suspended listing this time it really came?
In this letter, the Shenzhen Stock Exchange asked LeTV to indicate whether the company may trigger a suspension of the listing due to a negative net asset. In connection with the current net assets of LeTV, whether LeTV will suspend the listing raises concerns.
Liu Buchen, a researcher in the home appliance industry, said during the interview that at the moment, LeTV may be more appropriate to describe the 'accumulation hard to return' word. The loss of more than 13.8 billion yuan was awarded to the A-share 'Losing King' and its business continued to be 'acceptable.' In the state of shock, there is neither hematopoietic capacity nor blood transfusion opportunity. If the net assets are negative, the business level has never improved and the risk of delisting exists.
According to Dong Dengxin, director of the Institute of Financial and Securities Research of Wuhan University of Science and Technology, whether or not LeTV will suspend listing will still respect the laws and regulations. The suspension of listing under the law includes three consecutive years of losses, negative net assets, or major violations of the law. Observe the trend of LeTV. If LeTV cannot go bankrupt, it must suspend listing or delisting.
It is worth mentioning that Caixin had previously quoted insiders as saying that after taking over LeTV's mess, Sun Hongbin had communicated several solutions with the supervisory level, but it was difficult to implement for various reasons, and the market's expected restructuring plan was also not acceptable. OK. At present, there is no suitable asset for the LeTV system.