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SFC Regulation IPO Enterprise Revenue Distortion &Nbsp; Strictly Check Affiliate Dealers

2011/6/30 11:57:00 65

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"Just a few days ago, I just learned of a new audit trend, involving the issue of confirming the authenticity of the business income of the two modes of franchise and distribution.

"Guiyin Quan, general manager of Guoxin Securities Investment Banking Department, told reporters recently that" if the enterprise adopts the way of joining the company, the issuing committee will require the verification and reporting of the three year reporting period, and the financial indicators such as the revenue and net profit of each franchisee can not be provided, and it will be required to withdraw the listed materials. If it is clear, it must be responsible for its authenticity; if the enterprise adopts the distribution mode, it needs to provide the three year reporting period and the details of the terminal customers of each dealer's sales company.

Reporters also learned from many investment bankers, the above is for joining.

Distribution

Since the last year, the grasp of the trial size of the model listed company has been strictly strengthened. Its background is that the application materials of listed companies such as clothing, building materials, household goods, daily necessities and other industries have increased sharply. The tax evasion and tax evasion involving affiliate dealers, as well as the authenticity of the enterprise's financial data and the quality of information disclosure are becoming more and more obvious.

At the same time, regulators further enhance the supervision of IPO enterprises' income authenticity.

"Prospectus reveals that the names of the top five customers and suppliers of the listed companies are customary, but now the demand for gem has been raised, and the" upstream and downstream "situation will be disclosed as an indicator. If the" top five "ratios are low, it will expand to the top ten customers and suppliers.

"Investment bankers have told reporters that" the background of increasing supervision is that the quality of IPO enterprises is getting lower and lower, and the situation of financial packaging is becoming more and more serious.

For example, the authenticity of income is concentrated on the rationality of gross margin.

Up to the present gem IPO, the gross profit margin issue has not been noticed by the issuing Committee, which shows the determination of the SFC to strictly control it.

All the above said that there were various evidences in the summary report of the securities and Futures Commission in 2010.

If Zhejiang Harris, the SFC official disclosure is not because the prospectus disclosed the company from "production".

Manufacturer

"To" brand operators "change, but did not disclose the distributor, distribution mode and so on.

Changes in business models may have a significant negative impact on the company's continued profitability.

Another example is whether Fujian Tengxin food is denied because the company's operating performance has increased significantly during the reporting period, but there are many anomalies in the number of dealers and sales figures.

The company failed to make a reasonable explanation of the above situation, unable to judge the reasonableness of the substantial growth of issuers' performance and the sustainability of profitability.

According to statistics, in 2010, a total of 11 garment enterprises were listed, including Caesar, Hinur, search and other clothing brand operators, including enterprises from home textiles, shoemaking and other sub sectors.

China Garment Association official told reporters, "in June 2010, we made an investigation of the more than 60 best clothing enterprises in the country, and found that 60% of the enterprises had plans to be listed before 2012.

However, the cluster listing of garment enterprises brings the market to join.

Distribution mode

The widespread concern and controversy will further increase the strength of the SFC's issuing department to verify the authenticity of enterprise income.

In February 15, 2011, the newspaper published the analysis of "brand service enterprise cluster IPO changing the plate pattern" and "business life model innovation".

In May 5th this year, the securities and Futures Commission cancelled the IPO application for Zhuhai's Wiseman apparel company, which was originally scheduled for May 6th. The market believes that the most likely reason is that the data disclosure of franchisees and distributors is not true.

Semir dress and Busen dress have been over, which has caused great controversy.

It was reported that Semir apparel franchisees and distributors were suspected of evading taxes and tax evasion for 3 billion yuan, while Busen costumes were "over and not issued" for 8 months after the meeting, and their prospectus was vague about the disclosure of five major customers.

"In clothing, building materials, household goods, daily necessities and other industries, this is actually a matter of individual nature.

Manufacturers will not evade much tax, but terminal retailers can evade taxes much more. If manufacturers dare to announce the sales volume of distributors in various provinces, it will be a huge storm.

"A senior investment bank member summed up to reporters that" in the wholesale sector, the company took a large number of non invoices, cash payments and other ways to purchase garments from suppliers, and wholesale income was not accounted for. In the retail terminal, sales revenue and cost were not entered into accounts to help its subordinate companies and stores to evade value added tax and income tax on a large scale.

Based on this, many investment bankers believe that if the CSRC's issuance of audit caliber is strictly controlled in long term, the impact on the enterprises will be very huge. The workload of investment bank intermediary due diligence will also increase significantly.