On December 24, Chengdu M&S Electronics Technology Co.Ltd(688311) (688311. SH) received the warning letter issued by Sichuan Securities Regulatory Bureau. The warning letter shows that Chengdu M&S Electronics Technology Co.Ltd(688311) there are many irregularities in information disclosure.
Chengdu M&S Electronics Technology Co.Ltd(688311) was listed on the Shanghai Stock Exchange on July 31, 2020. The warning letter points out that the company has not established the registration and management system for insiders from the listing to October 25, 2021. There are no written confirmation opinions of the chairman and the Secretary of the board of directors, and no relevant information on the supervision of the board of supervisors in the file of insider registration of the third quarterly report of 2021. A similar situation occurred in last year’s annual report, which did not register the insiders of accounting firms, law firms and continuous supervisors.
In terms of the use of raised funds, on July 29, 2021, Chengdu M&S Electronics Technology Co.Ltd(688311) disclosed that the board of directors and the board of supervisors approved the company to use temporarily idle raised funds up to RMB 800 million (including this amount) for cash management. Chengdu M&S Electronics Technology Co.Ltd(688311) in this announcement, it is stated that when the company selects investment products, the relevant products must belong to the products with clear breakeven agreement with low risk, high safety and good liquidity.
The warning letter points out that some of the income vouchers purchased by Chengdu M&S Electronics Technology Co.Ltd(688311) cannot provide breakeven commitment, and cannot be cashed in advance within the holding period. There are inconsistencies in the relevant descriptions.
In terms of financial norms, Chengdu M&S Electronics Technology Co.Ltd(688311) there are also problems of non-standard information disclosure. The main business of Chengdu M&S Electronics Technology Co.Ltd(688311) is the R & D, manufacturing, sales and technical services of satellite navigation and satellite communication terminal equipment. It is divided into military products and civil products, with different sales modes.
The 2020 annual report disclosed that the sales revenue recognition time point of military products is customer acceptance, the sales revenue recognition time point of civil products in China is customer signing, and the overseas sales of civil products adopt four sales modes: insurance and freight (CIF), FOB, C & R and EXW.
The warning letter points out that in 2021, the revenue recognition time point agreed in the individual sales contract of the company’s subsidiaries is inconsistent with the actual recognition time point of the company, and the accounting policy description of overseas sales of civil products in the 2020 annual report is still incomplete.
Chengdu M&S Electronics Technology Co.Ltd(688311) in the description of revenue recognition policy for overseas sales of civil products, only the FOB sales mode is introduced, that is, the seller handles export customs clearance procedures, and the delivery is completed when the goods cross the ship’s rail at the designated loading port, and the risk of loss or damage to the goods is transferred from the seller to the buyer. In this mode, after the goods are declared and loaded, the bill of lading is the time point for the recognition of sales revenue. The warning letter points out that some sales actually take the ex factory selling price (EXW) mode as the basis for revenue recognition, so there is an incomplete description of accounting policies.
In addition, the warning letter also pointed out that in 2020, Chengdu M&S Electronics Technology Co.Ltd(688311) did not conduct impairment test on the issued goods, and its net realizable value was not determined on the balance sheet date.
(Daily Economic News)
