According to the data, as of 18:00 on April 26, a total of 3266 A-share listed companies had disclosed their 2021 audit reports, and 46 listed companies had issued non-standard audit opinions in their annual reports. There were major uncertainties in continuing operations, involving major cases and litigation, and major subsidiaries were out of control.
involving major cases
Among the listed companies that have disclosed their annual reports, 46 listed companies have issued non-standard audit opinions in their annual reports. Among them, 16 listed companies’ annual reports were audited with qualified audit reports issued by the audit institutions, 28 were issued with unqualified audit reports with emphasized items, and Great Wall International Acg Co.Ltd(000835) , delisting Zhongxin and 2 were issued with audit reports without expressing opinions.
Among the above 46 listed companies, 21 are ST and ST listed companies that have been implemented delisting risk warning and other risk warnings by the exchange. Among the listed companies that have issued non-standard audit opinions, there are a large number of listed companies involved in litigation.
According to the unqualified audit report with highlighted items issued by Changshu Guorui Technology Co.Ltd(300600) auditee, a series of civil litigation cases between Changshu Guorui Technology Co.Ltd(300600) multi mesh cloud data processing communication machine business and Nanjing Changjiang Electronic Information Industry Group Co., Ltd., Fushen Industrial Co., Ltd. and Harbin comprehensive bonded Group Co., Ltd. have been rejected by relevant courts due to criminal filing, and Changshu Guorui Technology Co.Ltd(300600) will file a lawsuit within the statutory time limit. The accounts receivable of 148 million yuan involved have been fully withdrawn for bad debt reserves, and the recovery of the above accounts is uncertain. As of December 31, 2021, there were 147 million yuan of finished products of multi mesh cloud data processing communication machine business in the company’s warehouse, and 984463 million yuan of inventory falling price reserves had been withdrawn according to the standards. There is uncertainty in the follow-up performance of the above contracts.
going concern ability remains the focus
In addition to litigation, from the reasons for the issuance of non-standard audit opinions, the main reasons are the major uncertainty of going concern and the loss of control of major subsidiaries.
Shenzhen China Bicycle Company (Holdings) Limited(000017) disclosed the 2021 annual audit report, which showed that the company was issued an unqualified audit report with significant uncertainty of going concern. The company’s reorganization plan has been implemented and the bankruptcy proceedings have been terminated on December 27, 2013. The company has set the conditions for the introduction of the reorganization party in the reorganization plan, hoping to restore the continuous operation ability and continuous profitability through asset reorganization. As of the date of the audit report, the company has not introduced the reorganizer. It only maintains the sustainable operation ability of Shenzhen Zhonghua company before the reorganizer injects assets by retaining the traditional business of selling electric bicycles and developing and selling new businesses such as lithium batteries, jewelry and gold. Considering that the net profit attributable to the parent company in 2021 was -1986700 yuan and the owner’s equity attributable to the parent company as of December 31, 2021 was 8918500 yuan, indicating that there are major uncertainties that may lead to major doubts about the sustainable operation ability of Shenzhen Zhonghua company.
Far East Smarter Energy Co.Ltd(600869) notarized Tianye Certified Public Accountants (special general partnership) has issued an unqualified audit report with emphasized items. According to the audit institution, Far East Smarter Energy Co.Ltd(600869) holding subsidiary Shengda Electric Co., Ltd. (hereinafter referred to as “Shengda electric”) held the board of directors and shareholders’ meeting in June 2021, decided to replace the legal representative and general manager of Shengda electric, elected and replaced the directors, the legal representative and general manager of Shengda electric refused to implement the relevant resolutions, and filed a lawsuit with Taixing people’s Court on the ground that the content of the resolution infringed upon its legitimate rights and interests as a shareholder, Request revocation of the resolution. Since Far East Smarter Energy Co.Ltd(600869) as the controlling shareholder of Shengda electric and the minority shareholder of Shengda electric caused judicial proceedings due to the dispute over the content of the resolution, the two sides have lacked the basis of trust and effective communication, Far East Smarter Energy Co.Ltd(600869) has been unable to obtain the complete financial statements and business data of Shengda electric since October 2021, and has not been able to obtain the licenses, seals, archives and other materials of Shengda electric, and Far East Smarter Energy Co.Ltd(600869) has lost control of Shengda electric since October 2021, It is no longer included in the scope of consolidation.
continuously issued non-standard audit opinions
It is worth noting that among the above 46 listed companies, 34 listed companies also issued non-standard audit opinions in their 2020 annual reports. Many listed companies have been unable to eliminate the risk points involved, so they have been continuously issued non-standard audit opinions.
Great Wall International Acg Co.Ltd(000835) 2021 audit report shows that the basis for the formation of unable opinions of audit institutions is multiple factors such as continuous operation, litigation matters, limited correspondence and limited audit of important subsidiaries. The announcement shows that the company has a serious loss of personnel and its business is basically at a standstill; The total operating revenue of the company in 2021 was 2.3712 million yuan, and the net profit attributable to the parent company was about -454 million yuan, which had been in loss for four consecutive years; As of December 31, 2021, the total shareholders’ equity attributable to the parent company was -1.034 billion yuan, and there were 951 million yuan of debt principal and interest overdue; Due to overdue debts and other matters, the company involved in many lawsuits, and some bank accounts and equity of some subsidiaries were frozen by justice. In 2020, due to continuous operation, litigation matters, impairment of long-term assets, limited letters of confirmation, limited audit of important subsidiaries and other reasons, the company was also issued an audit report with no opinion by the audit institution.
For the audit risk of the annual report, the China injection Association recently issued a document pointing out that individual listed companies change their accounting firms near the disclosure date of the annual report, or postpone the scheduled disclosure of the annual report, which has attracted market attention and high audit risk.
On April 26, the China injection Association released the express report on the audit of the annual report of Listed Companies in 2021. It showed that as of April 24, 2022, a total of 52 firms had reported to the China injection association the change information of the audit institution of the financial statements of listed companies, involving 434 listed companies. 25 subsequent firms have not reported the change information, 20 former firms have not reported the change information, and 389 former firms have reported the change information. For the reasons for the change, 193 said it was due to the business development or audit needs of listed companies; 99 said that it was due to the long service life provided by the former firm or the expiration of the employment period; 63 said they needed rotation according to the regulations; Nine said it was because listed companies changed their audit institutions according to the requirements of the group and controlling shareholders.
