On January 19, Zhejiang Securities Regulatory Bureau issued eight tickets, pointing to Anxin securities and seven related personnel, of which two insurance agents were identified as inappropriate candidates and were not allowed to engage in positions related to the recommendation business within two years. Zhejiang securities regulatory bureau pointed out that Anxin securities did not exercise due diligence in carrying out Zhejiang Yatai Pharmaceutical Co.Ltd(002370) 2015 major asset purchase projects and 2019 public issuance of convertible corporate bonds. In this regard, Anxin securities told the reporter of the daily economic news that the company will take a warning and seriously implement the rectification as required.
The reporter learned that there were false records in the financial data and related disclosure information in the annual reports of Zhejiang Yatai Pharmaceutical Co.Ltd(002370) 2016, 2017 and 2018. It is worth mentioning that on January 17 this year, Tianjian Institute, the audit institution of Zhejiang Yatai Pharmaceutical Co.Ltd(002370) financial statements, has just been sentenced to confiscation of business income of 1.55 million yuan and a fine of 3.1 million yuan.
8 tickets point to the failure of diligence of Anxin securities
On January 19, Zhejiang Securities Regulatory Bureau issued 8 tickets at one time, which attracted the attention of the industry. According to the disclosure of Zhejiang securities regulatory bureau, Anxin securities failed to exercise due diligence in carrying out Zhejiang Yatai Pharmaceutical Co.Ltd(002370) (hereinafter referred to as Zhejiang Yatai Pharmaceutical Co.Ltd(002370) ) major asset purchase project in 2015 and public issuance of convertible corporate bonds in 2019, failed to fully verify and verify the authenticity and accuracy of Zhejiang Yatai Pharmaceutical Co.Ltd(002370) information disclosure documents, insufficient due diligence and failed to perform continuous supervision obligations as required, Internal quality control is not perfect
Source: Zhejiang Securities Regulatory Bureau
Therefore, Zhejiang securities regulatory bureau decided to take supervision and management measures to order correction of Anxin securities. Zhejiang Securities Regulatory Bureau stressed: “your company should take warning, seriously find and rectify problems, establish and improve the internal control system, workflow and operation specifications of investment banking business, and effectively improve the quality of investment banking business. Your company should conduct internal accountability for the responsible personnel in strict accordance with the internal accountability system and submit a written report to our bureau.”
At the same time, seven relevant personnel were also punished, including the financial advisor sponsor of the major asset purchase project in Zhejiang Yatai Pharmaceutical Co.Ltd(002370) 2015, the sponsor representative of the public offering of convertible bonds project in 2019, the head of the project quality control department, the head of the project kernel, the head of the investment banking business department at that time, the deputy general manager in charge of investment banking at that time, etc.
It is worth mentioning that two of them, as the sponsor representatives of the Zhejiang Yatai Pharmaceutical Co.Ltd(002370) 2019 public offering convertible bond project, were identified as inappropriate candidates by Zhejiang securities regulatory bureau, and shall not hold positions related to the securities issuance and listing recommendation business of securities companies or actually perform the above positions within 2 years. Anxin securities shall also make a decision to remove the relevant positions of the two persons.
For this regulatory punishment, Anxin securities told reporters that the company will take a warning and seriously implement the rectification as required. In the future, it will further strengthen the awareness of compliance and responsibility, continuously improve the company’s internal control mechanism, play the role of “gatekeeper” in the capital market more actively and responsibly, and work together with the regulatory authorities and the exchange, Continuously improve the level of internal governance.
Zhejiang Yatai Pharmaceutical Co.Ltd(002370) the auditor of the financial statements has just been punished
So, what’s the problem with Zhejiang Yatai Pharmaceutical Co.Ltd(002370) ? On April 22, 2021, Zhejiang Securities Regulatory Bureau disclosed that at the end of 2015, Zhejiang Yatai Pharmaceutical Co.Ltd(002370) acquired 100% equity of Shanghai xingaofeng biomedical Co., Ltd. (hereinafter referred to as “Shanghai xingaofeng”), and Shanghai xingaofeng became a wholly-owned subsidiary of Zhejiang Yatai Pharmaceutical Co.Ltd(002370) and was included in the scope of consolidated statements.
However, from 2016 to 2018, Shanghai new peak recognized the sales revenue from 10 customers such as Anhui Xianlin Biotechnology Co., Ltd. without real business, and realized capital flow through three third-party entities, thus falsely increasing operating revenue, operating costs and operating profits. After the above financial data were included in the Zhejiang Yatai Pharmaceutical Co.Ltd(002370) consolidated statements, there were false records in the financial data and related disclosure information in the annual reports of Zhejiang Yatai Pharmaceutical Co.Ltd(002370) 2016, 2017 and 2018.
Zhejiang securities regulatory bureau decided to order Zhejiang Yatai Pharmaceutical Co.Ltd(002370) to make corrections, give a warning and impose a fine of 600000 yuan; At the same time, 17 relevant responsible persons were fined from 30000 yuan to 300000 yuan respectively.
Therefore, this has formed the above-mentioned punishment on Anxin securities. But in fact, just before the punishment of Anxin securities, that is, on January 17, Zhejiang Securities Regulatory Bureau issued the administrative punishment decision No. 1 of 2022 to Tianjian Certified Public Accountants (special general partnership) (hereinafter referred to as Tianjian Institute), the audit institution of Zhejiang Yatai Pharmaceutical Co.Ltd(002370) 2017 and 2018 financial statements, and three certified public accountants who signed the financial statement audit report
Source: Zhejiang Securities Regulatory Bureau
Zhejiang securities regulatory bureau said that Tianjian Institute provided audit services for Zhejiang Yatai Pharmaceutical Co.Ltd(002370) 2017 and 2018 financial statements and issued standard unqualified audit reports. However, Zhejiang Yatai Pharmaceutical Co.Ltd(002370) there were false records in the annual reports of 2017 and 2018, and there were several problems in the audit, such as insufficient attention to the qualification of suppliers, professional doubt about the rationality of transactions, reasonable doubt about contract abnormalities, etc.
Therefore, Zhejiang securities regulatory bureau decided to order Tianjian to make corrections, confiscate its business income of 1.55 million yuan and impose a fine of 3.1 million yuan; The three signing certified public accountants shall be fined 50000 yuan and 80000 yuan respectively.
