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Behind The Decline Of Nanfang Stock: The Abuse Of Power By The Chairman Is An Important Reason.

2013/4/27 14:07:00 38

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Nanfang Shares Listed Companies Textile Industry

when the self function is not yet perfect but strongly promotes the fast growth of physique, the declining fate seems to have long been doomed, especially for some industries which are mainly driven by buyer's market, such as < a target= "_blank" href= "http://www.91se91.com/" > textile < /a > a target= "_blank" href= "target=" > clothing > foreign trade. When the external demand decreases sharply and the cost rises sharply, the disorder expansion in the early stage may lead to the sharp fall of the enterprise.

> a href= "http://sjfzxm.com/news/index_c.asp" > Nanfang shares < /a > is one example.

Since its listing in March 2001, in the past ten odd years, *ST Nanfang has been reduced from a state-controlled state-controlled listed company to ST shares.

a auditing material from Shenzhen audit bureau's deep throat has unveiled the operation of Nanfang stock exchange for 10 years from March 2001 to the end of 2010.

The financial data, which are long and complicated, combined with all kinds of misconduct of former chairman Dan Xiaozhong, reveal a puzzle that the governance of the board of directors is invalid and the chairman abuse power to cause the company to decline.

freezing is not a cold day.

.

"P" once, like most of the enterprises beginning in the beginning of the reform and opening up, Nanfang textile shares close to the pulse of China's rapid economic development, and the growth path is quite representative - the reform of the stock system, the expansion of enterprise scale, the increase of efficiency, the accumulation of "a href=" http:// sjfzxm.com/news/index_cj.as "> /a >.

Nanjian is one of the foreign trade enterprises of Nanjing's state-owned capital. The annual import and export volume of the company has increased by 18% in 2001-2005 years, the average annual growth of the main income of the company is 22.28%, and the average annual net asset yield is 5.77%.

However, from 2006 to 2010, the operation situation of South Textile shares changed: the annual import and export volume fell by 7.66%, the annual income of the main business was 8.93%, the total amount of non-performing assets was 1 billion 30 million, and the loss was 646 million yuan.

"P" in January 21, 2011, the chairman of the company Dan Xiaozhong and the director Zhao Wanlong resigned suddenly, and then the deputy general manager Ding Jie and another deputy general manager Liu Shengning, and other company executives have received the news of the SFC's investigation, Dan Xiaozhong is also in the list.

Nanping shares 5 times in a year to change the announcement of executives of the company is puzzling.

Since its listing in March 2001, Shan Xiao Zhong has been appointed chairman and general manager of Nanfang stock. Until the resignation in January 2011, the company has been in charge of the power of the listed company for 10 years.

Until the spring of 2013, the case of Shan Xiao Zhong still had no final result.

The problem of "P > Nanfang spinning reflects the problem of the lack of board governance in state-owned holding enterprises.

controlled board /p >

The absolute power and the lack of checks and balances of the "P" leader are the most important causes of the disorder of Nanfang spinning.

So, how can the board of directors of Nanfang textile company be marginalized and nominal? In addition to Dan Xiaozhong and some of the top executives who have been placed on file, who should be responsible for all the previous board meetings?

look at the annual report of Nanfang textile listed for more than ten years, we can find that from the beginning of the listing to the "window", Shan Xiao Zhong has been playing two important roles: Chairman and general manager.

In the eyes of outsiders, the chairman often represents the board of directors of a company. It is the highest representative of shareholders' interests. The general manager belongs to the category of employees of the company, and is elected by the board of directors. He is responsible to the board of directors and shoulders the responsibility of managing and executing the board of directors decision making. P

The board of directors has the power of supervision and decision-making, while the general manager has the right to operate and part of the decision-making power to master the daily administrative power of the company.

in fact, Dan Xiaozhong, who is chairman of the board of directors and general manager, is the chief executive of Nanfang stock company. He is above the board of directors and presents a typical insider control.

An example in the early years was that Nanfang shares signed a contract with Jiangsu Jiahua to develop East Lake Lidao project. However, the audit results showed that the single bell department did not agree with the board of directors but directly led the signing and commissioning of East Lake Lidao project directly.

in fact, the articles of association of the various versions of Nanfang textile are publicly disclosed, including directors of concurrent managers, deputy managers or other senior managerial personnel (and directors appointed by staff representatives), which shall not exceed 1/2 of the total number of directors of the company.

The purpose of this provision is to ensure the relative separation between the decision-making level and the executive level, so as to ensure the supervision of the executive level and the protection of the interests of shareholders.

However, the composition of all board members after the listing of Nanfang shares in March 2001 shows that this regulation is only a mere formality, and the management layer is highly overlapped with the board members. The board of directors is essentially under the control of the management level.

since its listing in March 2001, the board of directors of the company has been Dan Xiaozhong, Hu Haige, Yang Jingcheng, Han Yong, Wang Yong, Zhou Faliang, Chen Shan, Chen Shan, and 11.

Ding Jie served as secretary of the board of directors and finance manager.

The biography of the 11 directors shows that Chen Shan, who was the manager of the property right Department of Nanjing state owned Assets Management (Holdings) company, Wang Lin, chairman and general manager of the Sinop Jiangsu company, and Zhou FA Liang, was the general manager of Nanjing state owned Assets Management (Holdings) Limited company. The 3 directors should be shareholders' representatives and Zhang Erzhen is an independent director.

Except for Shan Xiao Zhong, Hu Hai pigeon served as vice chairman and deputy general manager, and Yang Jingcheng was also deputy general manager of P.

The two directors of Han Yong and Wang Yong were middle-level cadres at that time, but were subsequently appointed as deputy general managers at the third second session of the board of directors held in April 18, 2001.

As a result, at least 5 of the 11 directors belong to the company's management level.

Here, Ding Jie was promoted from the finance department manager to the chief financial officer.

the director Zhao Wanlong is worth mentioning.

Zhao Wanlong's Jiangsu Jingwei computer company has no direct equity relationship with Nanfang textile company, but there is a lot of capital exchanges.

The reason why Nanfang company later became "ST" also stems from the false reimbursement method used by Nanfang spinning company to pfer 72 million 672 thousand and 800 yuan to Jiangsu Jingwei computer company account.

Zhao Wanlong himself served as the legal representative and general manager of Nanjing Jingwei Technology Co., Ltd. after September 2001.

According to the sixth three board of directors resolution of Nanfang textile company in June 19, 2009, Nanjing Jingwei Technology Co., Ltd. has a minority stake in Nanfang holding Sun company, Nanjing Bai Ye optoelectronics Co., Ltd., which is bought by Nanfang textile holding subsidiary and Nanjing Nantai display Co., Ltd.

another director, Zhang Shixiong, is located in Shenzhen Roland Chemical Co., Ltd., an investment target of Nanfang textile company announcements in the listing announcement.

According to the United Nations securities limited liability company's report on the initial public offering of A shares of the Nanjing textiles import and export Limited by Share Ltd in 2001, the investment did not go smoothly as scheduled. Zhang Shixiong also resigned from the board of directors at the third fifth board meeting in March 27, 2002, leaving the seats vacated by the board of directors to Wang Yuetang, the new independent director.

it can be seen that in the Nanfang textile company, there are 5 directors representing the operation of Nanfang textile company in addition to 3 shareholder representatives and 1 independent directors. The other two directors, Zhao Wanlong and Zhang Shixiong, have closer cooperation relationship with the shareholders and independent directors.

look at the Fourth Board of directors elected by the 2002 annual general meeting held in April 29, 2003 and the fourth first board of directors. The board members are Dan Xiaozhong, Hu Haige, Yang Jingcheng, Wang Yong, Han Yong, Zhou FA Liang, Chen Shan, Zhao Wanlong, earthquake, and 11.

The number of independent directors increased to 3, and the shareholders' representatives were reduced from the original 3 to two (Zhou Faliang, Chen Shan).

Dan Xiaozhong is still chairman and general manager. Hu Haige is still vice chairman and deputy general manager, Ding Jie remains secretary and chief financial officer of the board.

Under such a board structure, even if the two shareholders' representatives are exactly the same as the 3 independent directors, there are only 5 votes in the board of directors of the 11 people, which still belong to the minority, and it is difficult for the management to form effective checks and balances and supervision.

May 12, 2006, the company held the 2005 annual general meeting to elect the Fifth Board of directors. Apart from the replacement of the independent director Zhang Erzhen for the two term, the other 10 directors of the Fourth Board of directors were retained. The senior executives of Dan Xiaozhong and other 5 directors in Nanfang company remained unchanged.

Only Ding Jie's secretary of the board was changed by ran Fang, but the position of chief financial officer remained unchanged.

Director Zhao Wanlong has also served as chairman of Nanfang textile company and Nanjing high tech Jingwei Limited by Share Ltd since 2007.

that is to say, without considering the resignation time and the resignation of the sixth directors during the tenure of the three board of directors, they have served as directors of the three board of directors and core executives of Nanfang stock company.

Under such a pattern, the board of supervisors and independent directors originally used for checks and balances did not play its due role, P.

In the information disclosed by the company, there is no precedent for the board of supervisors or the independent director to veto the board meeting case, so that the authority entrusted by the company law and the articles of association can not be fully applied.

It can be said that the board of supervisors and independent directors have basically become a display.

take independent director as an example. The reporter noticed that from the only independent director Zhang Erzhen in 2001, the number of independent directors of Nanfang shares increased to 3, such as the establishment of Wang Yuetang as sole director in 2002, and the addition of Huang Weizhong as sole director in 2003, and then stabilized in the "three person group".

"P >" during the period of "Xiao Xiao Zhong" and other insiders, he was called the director of small shareholders' rights and interests and gatekeepers.

A person familiar with the matter said frankly that in fact, the directors were very clear about the company's situation and even shook their hands at the time of signing.

However, in the environment, there is no way to express opinions.

In this way, a high quality listed state owned enterprise, as Dan Xiaozhong and others have pursued, gathered and controlled the absolute power, finally slid into the abyss under the check and supervision mechanism.

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the concentration road of individual Kingdom /p >

the chairman of the board of directors will become an individual kingdom if the power of the chairman is infinitely enlarged.

Shan long Zhong served as chairman and general manager of Nanfang textile company for a long time, and resigned from 1994 to January 21, 2011 for 17 years.

In principle, Nanfang textile company as a listed company should have good governance rules. But since the listing of Nanfang textile company, the board of directors rules of the four versions of the single Xiao Zhong Administration (2002-3-29, 2003-8-23, 2005-4-23 and 2007-5-25), and the revised version of the board of directors rules (2011-5-31 version) after Dan Xiaozhong's departure showed that single Xiao Zhong has gradually made Nanfang company a personal kingdom.

in the 2002-3-29 edition of the board of directors rules of procedure, there is the shadow of Shan Xiao Zhong's personal kingdom.

As chairman of the board, Dan Xiaozhong has special disposal rights.

For the board meeting, Shan Xiao Zhong has the right to decide the time, contents and objects of the meeting, and has the right to decide whether or not to submit the agenda of the board of directors for the proposal of directors, supervisors and senior executives.

As for the contents of the board meeting, Shan Xiao Zhong has the right to notify the directors of the meeting only two days before the meeting, except for the contents of company secrets and timeliness, which greatly limits the other directors' right to know and to make decisions.

The rules of procedure also stipulate that voting intention is divided into consent and objection, and waiver is regarded as agreement, which further limits the voting rights of directors.

Even the rules of procedure directly challenge the minimum disclosure system of listed companies, which directly infringes on the right to know and supervision of the vast majority of shareholders, and even stipulates that the board of directors decides to distinguish between minutes and resolutions, only to know or only need to make a summary of the record within a certain scope.

In addition to giving Dan Xiaozhong all these powers, the rules of procedure do not forget to set up a small Treasuries for Dan Xiaozhong, the board fund, which is the responsibility of the finance department and is decided by Dan Xiaozhong. It is used for the purpose of the conference: funds for meetings, activities related to the business of the board and chairman, training expenses for directors, and other expenses agreed by the board.

obviously, the board of directors rules of the 2002-3-29 edition failed to satisfy Dan Xiaozhong's power appetite. In the 2005-4-23 version of the board of directors meeting rules, Dan Xiaozhong enjoyed greater power as chairman.

The 2005-4-23 version of the board of directors rules directly creates the concept of "the authority of the chairman of the board meeting".

During the adjournment of the board meeting, the chairman's functions and powers are as follows: 1. approves the acquisition and sale of assets not exceeding 5% of the net assets of the recently audited company; 2. approves the overseas investment of a single investment which does not exceed 5% of the net assets of the recently audited company; and 3., during the closing period of the board of directors, the acquisition, sale and outward investment of the same asset or related assets continuously during the closing period shall not exceed the above provision; 4. shall assign subordinate holding, share holding company directors and supervisors, and 5. other powers granted by the board of directors.

According to the net assets reported in the 2005 annual report, the shareholders' rights and interests (excluding minority shareholders' interests) are calculated at 785209681.32 yuan, that is, Shan Xiao Zhong has the right to decide separately the assets disposal and foreign investment of nearly 40 million yuan without the consent of the board of directors.

According to the company's articles of Association (2005-4-23 version), the board of directors only enjoyed the assets disposal and foreign investment rights within 10% of the net assets of the recently audited company.

What is more serious is that Shan Xiao Zhong has the right to appoint his subordinates to hold shares and share directors and supervisors separately.

This power enabled Dan Xiaozhong to completely abandon the board and shareholders' meeting of Nanfang textile company and control all the subsidiaries of Nanfang company.

In fact, most of the problems exposed by auditing are in the subsidiary companies of Nanfang textile company, for example, executives violate the ban on holding subsidiaries, Dan Xiaozhong and related expenses related to family life in subsidiaries.

in the board of directors rules of the 2007-5-25 edition, the vast majority of Dan Xiaozhong's board of directors has been extended, but he has excluded the right to approve foreign investment which is not more than 5% of the net assets of the recently audited company.

until after the resignation of Shan Xiao Zhong, Nanfang shares were repaid, and through the 2011-5-31 version of the board of directors meeting rules, the chairman's personal color was completely weakened. The chairman no longer enjoyed any privileges above the other directors. The chairman had only three functions: presiding over the general meeting of shareholders and convening and presiding the board meetings; supervising and checking the implementation of the resolutions of the board of directors; and other functions and powers granted by the board of directors.

Even the chairman was no longer the legal representative of the company.

The day-to-day work of the board is responsible for the new secretaries' office.

The motion of the conference is that the office of the secretaries general will seek advice from the board of directors and form a preliminary proposal before sending it to the chairman.

All board decisions shall be announced according to law, and minutes of meetings shall no longer be decided.

The so-called "board fund" has also been replaced by the "three special funds" and has set up strict management measures.

loss of state-owned assets /p >

How can the state-owned land and the nearly 30 million huge funds of P less than 42 acres be occupied for a long time and even unable to be recovered? During the period of serving as chairman of the board, how did some of the executives go from the mainland to the outside and take out the business step by step?

Nanping Textile Co., Ltd., a state-owned foreign capital enterprise, once took the lead in the industry. At the time of its brilliance, some of the good assets of state-owned enterprises began to be emptied. This sequela of P has not yet been completely resolved.

July 1999, Nanfang Textile Co., Ltd. signed an agreement with Jiangsu Jiahua Industrial Co., Ltd. to make sure that its development project and Nanjing East Lake Garden residential district fund are responsible for Nanfang share, and the construction, sale and management are undertaken by Jiahua company.

February 2002, the construction project planning permit (Ning Jian Zi (2002) No. 016) approved the approval of the first phase of the East Lake Garden residential quarter, and the Jiangning county planning and Economic Commission issued the reply to the Jiangsu Jiahua Industrial Co., Ltd. for the development and construction of the East Lake Garden residential district renewal project.

however, in the implementation process, the main body of construction was Jiahua company, and the state-owned land use permit (Jiangning No. 2000) 0284 was also registered under the name of Jiahua company, and the owner of the house property was not a contributor to Nanfang shares. Obviously, the South spinning share as a contributor lost control of the project.

What is more serious is that in the cooperation with Jiahua company, the 42 mu land owned by Nanfang shares was illegally occupied by P.

According to the audit report of Nanjing Audit Bureau, the land certificate office under the Jiahua company's East Lake Lidao project has more than 28480.5 square meters of land and 42 mu of land undeveloped.

According to the agreement on the development and construction management of East Lake Lidao project signed by Nanfang textile and Jiahua company, the land, property and related debt and debt of the project belong to Nanfang share, but Jiahua company refuses to return 42 mu of land.

After asking for no return, Nanfang shares had to prosecute Jiahua company to the people's Court of Yuhua District of Nanjing. The final judgment was: 42 acres of land use rights were made by Nanfang textile company, and asked Jiahua company to pfer the land to Nanfang textile stock.

Nanfang shares and Jiahua company should have handled the pfer procedures of the right of land in time in accordance with the court's judgment. However, it is strange that Nanfang shares were not approved by the SASAC without assets assessment. In December 2010, they signed another agreement with Jiahua company to pfer the 42 mu land use right to the other party at a price of 80 million yuan.

It is worth mentioning that, a month later, in January 2011, Shan Xiao Chung announced his resignation.

According to the reporter's understanding, the problem has been pferred to the discipline inspection and supervision organ of Nanjing, and there is no definite result.

September 25, 2012, *ST Nanfang issued a notice on the termination of the cooperative development project, indicating that it was signing the agreement on termination of cooperative development of East Lake Garden residential district with Jiahua company. The company will no longer participate in the development and construction of East Lake Garden residential district project, and will receive 95 million yuan of proceeds from the project.

42 acres of land were not mentioned.

The problem of "P > East Lake Lidao project is more than that.

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the audit report of Nanjing audit bureau shows that the price of 10 sets of villas sold by the East Lake Lidao project under the Nanfang shares is low.

In 2002, 335.21 square meters of single family villas were sold to 6 related households at a price lower than the average selling price of 41% to 58%; in 2004, 312.54-355.76 square meters of single family villas were sold to 3 related households at a price lower than the average selling price of 22%-72%; in 2004, 295.87 square meters of single family villas were sold to 1 Relations households at a price below 53% of the average price.

according to the 169th provision of the criminal law of the People's Republic of China, "the persons directly in charge of state owned companies, enterprises or their superior departments shall engage in malpractices for personal gain, sell state-owned assets at a low price or sell at a low price, causing serious losses to the interests of the state, and shall be sentenced to fixed-term imprisonment of not more than three years or criminal detention."

It is understood that the matter has been pferred to the discipline inspection and supervision organ of Nanjing.

in addition, in August 2002, Nanfang shares were pferred to Jiahua company by 180 million yuan and 122 villas and 106 apartments.

the loss of state-owned assets of Nanfang shares is also expensive.

According to the audit report of Nanjing Audit Bureau, Jiahua company pferred the East Lake kindergarten 1230.19 square meters and the East Lake Li Island Club 6089.44 square meters to Nanfang by estimating the price of 41 million 239 thousand and 100 yuan.

Audited, East Lake kindergarten and East Lake Lidao club are valued at 5634 yuan / square meter, compared with the average cost of East Lake Lidao villa 1563 yuan / square meter, the total value is overestimated 29 million 798 thousand and 200 yuan.

According to the regulations, East Lake kindergarten and East Lake Li club should be accounted for according to the actual value of 13 million 370 thousand yuan.

not only in the territory, but also at the senior level of Nanfang textile company, overseas entities occupied company funds.

the audit report of the Nanjing audit bureau shows that in 1993, Nanfang Textile Co., Ltd. was established in Singapore by the Nanjing foreign trade and Economic Cooperation Bureau and the Commerce Department of the Chinese Embassy in Singapore.

The company registered capital of 500 thousand yuan new currency, of which Nanfang shares accounted for 49% of the shares, and Singapore's downer private limited company accounted for 51% of the shares.

The company is mainly engaged in the re export trade of textiles and clothing, that is, through the purchase of goods from Nanfang textile, it will be sold externally, and then the corresponding payment will be paid to Nanfang share after sales.

Yang Chunsheng, former deputy general manager of Nanfang stock company, serves as general manager of Tun Na Yu Feng.

1999, Yang Chunsheng founded Transibilt Engineering Pte Ltd in Singapore and began to work in the construction industry.

In 2001, Yang Chunsheng acquired another construction company in Singapore, A Pacific Construction Development Ltd (Asia Pacific Engineering Development Private Limited).

During the operation, the two construction companies received about $4 million 770 thousand in liquidity from downer, which has not been reimbursed.

2007, Nanfang shares directly provided A Pacific Construction Development Ltd with about 986 thousand US dollars and has not yet been reimbursed.

The audit report of Nanjing audit bureau shows that as at December 31, 2010, Yuen Feng company directly or indirectly occupied Nanyuan share capital of about 39 million 597 thousand and 700 yuan.

in a series of dazzling operations, the state-owned assets of Nanfang share were gradually "emptied".

As of the end of 12 2010, 37 subsidiaries occupied 249 million 477 thousand yuan of Nanfang share fund, 14 of which were in deficit state, occupied 204 million 225 thousand and 100 yuan of Nanfang share fund, and 82 million 160 thousand and 300 yuan was confirmed to be uncollectible.

Nanfang shares have raised 16 million 736 thousand and 700 yuan in bad debts, but not 65 million 803 thousand and 500 yuan in the books.

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expansion of selfish desire /p >

private small Treasuries have long been banned by the state, but Nanfang shares have been excavated several small coffers, involving nearly 100 million yuan.

In addition, the shareholding of managers in the middle and upper levels of state-owned enterprises has a "red line".

absolute power will inevitably lead to absolute corruption. Dan Xiaozhong's self interest behavior is amazing.

Illegal shareholding is an example.

the audit report from Nanjing audit bureau shows that in the Nanfang spinning management department, Shan Xiao Zhong holds A Pacific Construction & Development (S) Pte Ltd50% shares, and also holds 50% stake in Transbilt Engineering Pte; the former vice president of Nanfang textile shares owns 36.6% stake in the company and holds 30% stake; the deputy general manager Han Yong and other senior managers hold 30% stake in Nanjing Construction & Textile Industry Co., Ltd., holding 30% equity of Nanjing Mawei brand promotion Co., Ltd., and 30% equity interest in Nanjing Six Dynasties clothing and Accessories Co., Ltd..

the above behavior violates the "opinions on regulating the shareholding and investment of state-owned enterprises", the reform of state owned assets [2008], 139, second, fourth provisions, that is, "shall not directly or indirectly hold the provisions of the enterprises invested by enterprises at all levels, equity participation enterprises and other enterprises invested by the group company."

What is more serious is that the above capital contributions are paid by Nanfang shares, which do not conform to the "opinions on regulating the shareholding and investment of state-owned enterprises" and the reform of state owned assets [2008] No. 139, second, seventh, stipulates that "state owned enterprises shall not provide loans or cushion payments for employees to invest in stocks."

in addition, despite the repeated orders of state departments concerned, it is strictly forbidden to set up "small Treasuries" in state-owned enterprises. But in the years after Dan Xiaozhong's holding of Nanfang shares, all kinds of "small coffers" appear frequently.

the audit report from Nanjing audit bureau shows that the small coffers of Nanfang stock began in April 1996. Yang Jingcheng, the deputy general manager of the company, is responsible for the registration of income confirmation and the registration of small Treasury accounts.

From April 1996 to March 2011, the total revenue of the small Treasuries account was 93 million 72 thousand yuan, with a total expenditure of 92 million 392 thousand and 300 yuan.

The balance of funds is 679 thousand and 629 yuan, and its income mainly comes from the proceeds of securities, financial returns, various insurance refunds, Nantai Shopping Plaza (wholly owned subsidiary of Nanfang stock), shopping malls, rental income, etc., of which 83 million 300 thousand yuan is used for bonus payment.

the small foreign treasury of Nanfang stock also started in 1996, and Dan Xiaozhong was responsible for the examination and approval of expenditure.

The small treasuries of Nan Tai shopping plaza were set up in 2002.

August 2000, Nanfang Textile Co., Ltd. pferred two hundred million yuan of funds to the accounts of Nanjing kings clothing company through the "cardiopulmonary bypass" of the commercial acceptance bill discounted and the promissory note endorsement, and pferred the funds into the securities company to carry on the entrusted financial management business and the stock market operation through the account, and deposited the financial revenue 8 million 680 thousand yuan and the securities investment income 22 million 160 thousand yuan into the small Treasuries, and after cash withdrawals, it was distributed to individuals.

no good can be achieved without selfish ends.

Compared with illegal holdings and private small Treasuries, it is not surprising that Dan Xiaozhong, a cadre of state-owned enterprises, benefits the interests of the public.

East Lake Lidao garden club belongs to the assets of Nanfang stock, but under the intervention of Dan Xiaozhong, it has been contracted to its relatives, Wang Jingping and others for a long time. The latter has also paid free use of three properties in Nanfang and Nantai (the original value of the book is 41 million 240 thousand yuan). The free occupation of Nanfang and Nantai shows 10 million 660 thousand and 240 yuan of working capital loans.

Up to the end of the audit of Nanjing Audit Bureau, no income has been paid to the South spinning shares.

The audit report of Nanjing audit bureau shows that during the 3 years from January 2007 to May 2011, Dan Xiaozhong's personal household water and electricity gas expenses totaled 87754.20 yuan, and all of them were included in the cost of East Lake Lidao Garden Club. A car was specially arranged for the family members of their families. The cost of related cars and the driver's wages and bonus were 500 thousand and 300 yuan in the management fee of the club.

In addition, Dan Xiaozhong's nephew, Zhi Wei, never worked in a clubhouse, but he received a monthly salary bonus of 1500 yuan. From February 2009 to May 2011, he received a salary bonus of 56 thousand and 500 yuan.

June 2008, Nanfang shares set up Binhai Nantai Wool Industry Co., Ltd.

Dan Xiaozhong's niece Dan Yumei became the sponsor of the project. His nephew is a deputy general manager and project leader of the item company.

The three members did not have the authorization of the board of directors of Nanfang textile company, but they control the operation and disposal of the assets of Binhai Nantai.

failure internal control /p >

Nanfang shares did not establish a number of control systems such as the related party paction decision making system, but these systems stayed on paper and hung on the wall.

except for disadvantages.

What exactly is the control of Nanfang stock?

After the listing of Nanfang Textile Co., P, the scale of investment has expanded dramatically every year. Investment enterprises are characterized by excessive quantity, scattered industries, complex ownership, confusion in management and low return rate. More than half of the enterprises are closed, semi closed or heavily damaged.

Why does this happen? The company's management and control system is not only defective in design, but also leads the management to violate the regulations in daily execution, resulting in no guarantee of the company's operating results and efficiency, the reliability of information disclosure is reduced, and the risk of lawful compliance of business behavior is aggravated.

Nanjing audit bureau's audit report shows that there are seven major problems in Nanfang share.

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first, there is no corresponding separation measure involved in the incompatible functions of the business process. It includes: "the import department sets import business operation and import inventory out and warehousing management. Although the company has a" payment document "restriction, the decision to release the goods at the import department can not constitute a mutual restriction order, which results in the more than 200 million of the import department's overdue 5 years' payment." the Nanjing Nanhai share company, a wholly owned subsidiary of the company, directly charges cash payment, and then solves the company account. In 2010, 3 million 222 thousand and 100 yuan of cash was left in the hands of the salesperson. "

Second, authorized approval control is missing.

Nanfang shares should implement collective decision making or joint signing system for major businesses, such as the purchase of East Lake Lidao villa project, the pfer of right of management and the determination of interests, the outflow of large capital and the development of high-risk businesses in East Lake.

Third, accounting system control is missing.

Nanfang shares do not check the balance of bank deposits and the balance of bank statements every month. It only adjusts at the end of the year, resulting in the lack of funds of 380 thousand yuan in 2007 and 2008.

Fourth, property protection control is weak.

Nanfang shares did not establish daily property management system and regular inventory system, financial records, physical custody, regular inventory, accounting check and other internal control measures have not been effectively implemented, property losses are huge, such as parent company inventory loss accounted for 52% of the total inventory; 10 out of house property, outside the company's supervision.

fifth, control and control of stock control companies are not in place.

Although Nanfang textile company formulated the management method of Nanfang stock company in 2007, because most of the directors of the holding subsidiaries are held by executives of stock companies, some executives are holding shares in their subsidiaries, driven by interests, and the policies and procedures of the parent company's decision-making level, such as the competition of the parent company and the related paction, seriously damage the overall interests of the stock company.

Such as Liu Shengning's responsible company, Ding Jie's Nantai display company, and Dan Xiaozhong's coastal wool company, more than 75% of the merchandise purchased from Nanfang shares, the profits of the joint stock company are pferred to the subsidiary company, and then the state assets are privately divided by way of bonus and rebate.

sixth, financial derivatives trading control is not standardized.

Nanfang shares use short-term financing bills, foreign exchange financing, NDF arbitrage and other ways of financing and reduce the cost of capital, but Nanfang shares did not formulate corresponding financial derivatives trading risk management system to regulate the Ministry of Finance and finance, regulate the traders' choice, assessment, risk isolation, stop loss and other policies and procedures with the system.

seventh, there are serious defects in information system control.

The existing information system of Nanfang shares does not conform to the requirements of internal control in information technology control objectives, program changes, computer operation and data contact. The security, reliability and rationality of the information system are obviously blemish.

besides, the company has not established a method of performance management and assessment combined with profit and loss. Sales and royalties have been maintained at a relatively high level for a long time when sales revenue and profits continue to decline. Under continuous losses, the salary level of executives and salesmen and vocational departments is far higher than that of the same industry.

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Although there are some problems in the regulation of Nanfang shares, the absence of the property owners and the distortion of the management system of the state-owned assets have led to their long-term "dissociation" beyond the supervision system of the local state-owned assets. This is a painful lesson that must be highly valued. p

P, like other state-owned enterprises, Nanfang is naturally facing the problem of virtual ownership of state owned property rights.

According to the enterprise assets law of the people's Republic of China (May 1, 2009) and other laws and regulations, there is a multiplayer principal-agent relationship between the "all the people" of state-owned enterprises and the actual management of state-owned enterprises.

The longer the principal agent chain is, the more loopholes the final agent can drill, and the greater the difficulty of supervision.

practice, due to historical reasons such as block segmentation, before the implementation of the state-owned assets law, many government departments can manage and intervene state-owned assets in addition to the SASAC.

For example, the old owner of Nanfang textile company is the Nanjing economic and Trade Commission. Shan Xiao Zhong was born in the director of the import and Export Department of Nanjing economic and Trade Commission and the office director.

Although the controlling power of Nanfang shares is in the SASAC of Nanjing, it has long been supervised by the Nanjing Municipal Economic and Trade Commission.

It was not until 2010 when Nanjing revoked the foreign trade and Economic Cooperation Bureau that the Nanjing SASAC was strong enough to intervene.

Moreover, due to the principle of Party's management of cadres, the party committees at all levels and the SASAC are jointly responsible for the appointment and removal of state-owned enterprises' management and management.

in addition, even if the SASAC is a state-owned enterprise, the SASAC often controls indirectly through holding companies.

For example, the first big stock of Nanfang textile company was formerly Nanjing state owned Assets Management (Holdings) Limited company. After that, it was renamed Nanjing state-owned capital Trading Co., Ltd. and Nanjing business travel group. Nanjing state owned Assets Management (Holdings) Co., Ltd. is also a wholly owned subsidiary of Nanjing state owned assets investment management holding (Group) Co., Ltd., and Nanjing SASAC holds 100% of the latter.

That is to say, there are three levels of principal-agent relationship between Nanfang spinning company and Nanjing municipal SASAC.

Various factors in the above practice further extend the chain of principal-agent relationship, which further worsens the lack of governance caused by the lack of state ownership.

Nanfang textile company as a listed company, compared with other non listed state-owned enterprises, it should be said that in terms of equity diversification and openness and pparency, it is a step ahead. Theoretically, its corporate governance structure is superior to other non listed state-owned enterprises.

What is the actual effect? Taking the 4 extraordinary shareholders meeting in 2011 as an example, the first time the shareholders and shareholders' representatives attending the meeting were the first temporary shareholders' meeting in February 11, 2011, a total of 14 shareholders, the total number of voting shares was 100169877 shares, accounting for 38.72% of the total number of voting shares of the company. The least time was fourth shareholders of the provisional shareholders' meeting (or shareholders' agents), 5 of whom held 94599026 shares of voting shares, accounting for 36.57% of the total share capital of the company.

According to the 2010 annual report of the company, three state-owned corporate shareholders of Nanfang textile company, Nanjing state owned Assets Management (Holdings) Limited (34.99%), Nanjing commercial building Limited by Share Ltd (2%) and Sinop Jiangsu company (1.38%), have accumulated 38.37% of the shares of Nanfang textile company.

Looking at the previous announcement of the resolution of the general meeting of shareholders, almost all motions were deliberated and approved by 100% of the total number of shares agreed by the voting shareholders.

Is this the result of exactly the same attitude of the shareholders to all voting motions, or the form of shareholders' meeting becoming a form of "free riding" for some state owned corporate shareholders? As for the voice of those natural and non state owned corporate shareholders, it seems that they have not been fully reflected in the governance structure of Nanfang textile company. Does the share diversification of nnco play its due supervisory and regulatory role?

according to the final audit opinion issued by Nanjing Audit Bureau, Nanjing SASAC should standardize the management target of state-owned assets, improve the supervision and management system of state assets, and guard against the risk of loss of state assets.

January 4, 2013, *ST Nanfang issued the annual earnings announcement for 2012, which will turn the deficit into profits compared with the same period last year, and achieve net profit of about 500-2000 yuan attributable to shareholders of listed companies.

However, the profit of this report depends on the sale of its assets, which is not sustainable.

Anecdotal speculation that Nanjing business travel group's enterprises, or *ST Nanfang textile reorganization object.

*ST South spinning can be described as a wave of robbery. Although the leadership of the company has been replaced and the old and new can be cut off, can the system's sinking and old thoughts be cleared away? No matter how, such a state-owned enterprise can no longer afford to toss it. The tragedy of governance can no longer be repeated!