Yan’an Bikang was ordered by China Securities Regulatory Commission to correct the confusion of accounting work and the false increase of monetary capital

Recently, the CSRC website announced the decision to order Yan’an Bikang Pharmaceutical Co., Ltd. (hereinafter referred to as “Yan’an Bikang”, 002411. SZ) to take corrective measures. According to the letter of decision, < / P > < p > from 2015 to 2018, Yan’an Bikang covered up the situation that the controlling shareholder xinyibikang new pharmaceutical industry complex Investment Co., Ltd. and its related parties occupied the funds of the listed company through false financial accounting and other means, resulting in the false increase of monetary funds and inaccurate accounting of current accounts. In addition, Yan’an Bikang does not standardize the accounting of sales expenses, and the sales expenses are recorded in the operating costs, which leads to inaccurate accounting of operating costs and sales expenses. < p > < p > the above problems reflect that Yan’an Bikang has chaotic basic accounting work, serious lack of internal control, and serious absence of control over subsidiaries, which can not guarantee the authenticity and integrity of accounting data, and can not achieve the objectives of internal control, which does not conform to Article 3 and article 31 (1) of the basic norms for internal control of enterprises (CAI Hui [2008] No.7) and the governance standards for listed companies (CSRC) Notice [2018] No. 29) Article 3, paragraph 2. In accordance with the provisions of Article 21 of the measures for on site inspection of listed companies (CSRC announcement [2010] No. 12), Shaanxi regulatory bureau decided to take regulatory measures to order Yan’an Bikang to correct. Yan’an Bikang should attach great importance to it, take practical measures to rectify the existing problems, and submit a written rectification report to our bureau within 15 working days from the date of receiving this decision. < p > < p > < p > Article 3 of the basic norms for internal control of enterprises stipulates that the internal control referred to in this specification is a process implemented by the board of directors, the board of supervisors, the management and all employees, aiming at achieving the control objectives. The goal of internal control is to reasonably ensure the legality and compliance of enterprise operation and management, asset safety, financial report and related information authenticity and integrity, improve operation efficiency and effect, and promote enterprises to realize development strategy. < p > < p > < p > Article 31 of the basic norms for internal control of enterprises stipulates that the accounting system control requires enterprises to strictly implement the unified national accounting standards system, strengthen the basic accounting work, clarify the processing procedures of accounting vouchers, accounting books and financial accounting reports, and ensure the authenticity and integrity of accounting data. An enterprise shall set up an accounting institution and provide accounting practitioners in accordance with the law. Personnel engaged in accounting work must obtain accounting qualification certificate. The person in charge of an accounting institution shall have the professional and technical post qualification of accountant or above. < p > < p > < p > < p > the third article of the corporate governance standards for listed companies stipulates that shareholders shall have the right to know and participate in the major matters of the company stipulated by laws, administrative regulations and the articles of association. Listed companies should establish effective channels of communication with shareholders. < p > < p > < p > Article 21 of the measures for on site inspection of listed companies stipulates that if problems exist in the standardized operation of the inspected objects, the CSRC may order the inspected objects to take corrective measures.

if the measures mentioned in the preceding paragraph are taken, the CSRC shall inform the inspection object and relevant personnel of the facts, reasons and basis of the inspection confirmation in advance. If the objects of examination or relevant personnel have different opinions, they may plead, state their opinions and explain the reasons. The CSRC shall review this and inform the re examination results within 10 working days from the date of receiving the defense and statement of opinions. < p > < p > after investigation, from 2015 to 2018, your company covered up the situation that the controlling shareholder xinyibikang new pharmaceutical industry complex Investment Co., Ltd. and its related parties occupied the funds of the listed company by means of false financial bookkeeping, resulting in false increase of monetary funds and inaccurate accounting of current accounts. In addition, your company’s accounting of sales expenses is not standardized, there are sales expenses recorded in operating costs, resulting in inaccurate accounting of operating costs and sales expenses. The above problems reflect that your company’s basic accounting work is disordered, the internal control is seriously missing, and the control of subsidiaries is seriously absent. It can not guarantee the authenticity and integrity of accounting data, and can not achieve the internal control objectives. It is not in line with Article 3 and paragraph 1 of article 31 of the basic norms for internal control of enterprises (CAI Hui [2008] No.7) and the governance standards for listed companies (CSRC announcement [2018] 2) 9) Article 3 (2). According to the provisions of Article 21 of the measures for on site inspection of listed companies (CSRC announcement [2010] No. 12), our bureau has decided to take regulatory measures to order your company to correct. Your company should attach great importance to it, take practical measures to rectify the existing problems, and submit a written rectification report to our bureau within 15 working days from the date of receiving this decision. < / P > < p > if you are not satisfied with the supervision and management measures, you may apply to the China Securities Regulatory Commission for administrative reconsideration within 60 days from the date of receiving this decision; you may also file a lawsuit with the competent people’s court within 6 months from the date of receiving this decision. During the period of reconsideration and litigation, the above-mentioned supervision and management measures shall not be suspended. < / P > < p > Disclaimer: the purpose of this article reprinted by china.com finance and economics is to convey more information and does not represent the views and positions of the website. The content of this paper is for reference only and does not constitute investment advice. Investors operate accordingly and bear their own risks. < p > < p > Chinanet is a national key news website under the leadership of the Information Office of the State Council and managed by China foreign language publishing and Distribution Bureau. Through 11 versions in 10 languages, the website releases information 24 hours a day, which is an important window for China to carry out international communication and information exchange.