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CSRC Fines Auditor GP Certified for Its Part in China’s Worst Financial Scandal at a Public Firm
Yang Jiao
DATE:  Mar 22 2021
/ SOURCE:  Yicai
CSRC Fines Auditor GP Certified for Its Part in China’s Worst Financial Scandal at a Public Firm CSRC Fines Auditor GP Certified for Its Part in China’s Worst Financial Scandal at a Public Firm

(Yicai Global) March 22 -- China’s securities watchdog has fined GP Certified Public Accountants CNY57 million (USD8.8 million) for its involvement in the biggest financial fraud among mainland-listed companies.

GP Certified falsified visiting records and included bank documents forged by its client Kangmei Pharmaceutical in its audit of the drugmaker in 2016, the China Securities Regulatory Commission said on its website on March 19. The CSRC had been investigating the Guangzhou-based accountancy firm since May 2019.

Kangmei overstated its cash holdings by a total of CNY88.6 billion (USD13.6 billion) in its financial reports between 2016 and 2018. Last May, the CSRC said it had handed the Shanghai-listed pharmaceutical giant the maximum penalty of CNY600,000 (USD92,200).

The CSRC has suspended a number of initial public offerings audited by GP Certified since May 2019, impacting as many as 26 IPO-hopefuls. Some that had planned to go public on the Star Market, Shanghai’s science and technology innovation board, have yet to list.

GP Certified has 90 listed firms as its clients, almost the same number as in early 2019. Even after the scandal, the company has helped many firms to go public. Its clients include 35 state-owned enterprises, four financial institutions, and 90 foreign-invested firms. 

Editors: Liao Shumin, Emmi Laine

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Keywords:   Kangmei Pharmaceutical Co.,Accountants