China’s Sound Global plunges 61 per cent after sacking chief financial officer for missing 2 billion yuan
Beijing-based firm denied allegations it had inflated sales and profits
Shares of water- and sewage-treatment projects developer Sound Global, whose chief financial officer was sacked after 2 billion yuan was found missing from its books, have plunged 61 per cent as trading resumed after a 10-month suspension.
They ended the morning trading session at HK$2.72, down from HK$7 on March 13 when they were last traded. The Hang Seng Index has fallen 18.4 per cent in the same period.
The Beijing-based firm, which had denied accusations from anonymous company researcher and short-seller Emerson Analytics a month before trading was suspended that it had inflated sales and profits, said it had met securities regulators’ requirements for trading to resume.
“The company has already put in place adequate financial reporting procedures and internal control systems to meet the obligations under the listing rules,” it said in a filing to Hong Kong’s stock exchange on Monday.
It had engaged independent forensic specialist RSM Nelson Wheeler Certified Public Accountants to investigate the 2 billion yuan cash discrepancy, and published outstanding financial results, to meet the exchange’s requirements.
The cash shortfall at the end of 2014 was discovered by its former auditor, Deloitte Touche Tohmatsu, when it audited its 2014 financial statements.