Chinanews.com, March 3 According to the Ministry of Finance website on the 17th, since 17, the Ministry of Finance has inspected the quality of accounting information of China Huarong Asset Management Co., Ltd. (hereinafter referred to as Huarong) and the practice quality of its auditor, Deloitte Touche Tohmatsu (hereinafter referred to as Deloitte).
The Ministry of Finance set up a special inspection team to carry out on-site inspections of Huarong and Deloitte, interrogate and interview relevant personnel, review and copy relevant materials, extensively investigate and collect evidence, solicit inspection opinions from Huarong and Deloitte, and conduct several centralized hearings and expert demonstrations on the problems found in the inspections. From February 2023 to March 2, 24, at the application of the parties, the Ministry of Finance organized a hearing for Deloitte in accordance with the law, fully listened to the statements and defense opinions, debated and cross-examined the relevant facts, and ensured that the facts were clear, the evidence was conclusive, the characterization was accurate, and the procedures were legal.
After investigation, Huarong had problems such as internal control and risk control failure and serious distortion of accounting information to varying degrees from 2014 to 2019. Deloitte did not pay sufficient attention to the substance of Huarong's economic business, failed to penetrate the audit of the true status of the underlying assets, ignored the approval compliance of major investment matters, did not properly express audit opinions on identified abnormal transactions, failed to objectively evaluate the status of corporate assets, failed to accurately assess the reasonableness of the expected credit loss model parameters, did not maintain professional skepticism during the provision of audit services, did not effectively implement the necessary audit procedures, did not obtain sufficient and appropriate audit evidence, and had serious audit deficiencies.
In accordance with the Accounting Law of the People's Republic of China, the Certified Public Accountants Law of the People's Republic of China and other laws and regulations, the Ministry of Finance adhered to the principle of "proportionate penalties and fair law enforcement", and comprehensively considered the nature, extent, duration and scope of impact of Huarong and Deloitte's illegal acts, and made an administrative penalty decision in accordance with the law on March 2023, 3.
Huarong:
an administrative penalty of RMB 10,<> imposed on China Huarong Asset Management Co., Ltd.;
An administrative penalty of RMB 10,<> was imposed on Huarong Zhiyuan Investment Management Co., Ltd.;
an administrative penalty of RMB 10,<> to Huarong Tianze Investment Co., Ltd.;
An administrative penalty of RMB 10,<> was imposed on Huarong Overseas Chinese Asset Management Co., Ltd.;
An administrative penalty of RMB 10,<> was imposed on Huarong International Trust Co., Ltd.;
an administrative penalty of RMB 10,<> was imposed on Huarong Huitong Asset Management Co., Ltd.;
An administrative penalty of RMB 10,<> was imposed on Huarong Ruitong Equity Investment Management Co., Ltd.;
Huarong Industrial Investment Management Co., Ltd. was fined 10,<> yuan.
The above penalties are the top penalties imposed in accordance with Article 43 of the Accounting Law of the People's Republic of China.
According to the seriousness of the circumstances, six responsible persons such as Li Moumou who signed the annual financial and accounting report of Huarong related companies were given an administrative penalty of 6,5 yuan, six responsible persons such as Li were given an administrative penalty of 6,3 yuan, and seven responsible persons such as Chen were given an administrative penalty of 7,1 yuan.
For Deloitte:
Give Deloitte head office warnings;
Suspended the operation of Deloitte Beijing Office for 3 months;
Deloitte Beijing Office confiscated the illegal gains and imposed a total fine of RMB21,190.44 million, and Deloitte Head Office assumed joint and several liability.
According to the seriousness of the circumstances, two responsible persons such as Jing Moumou, the CPA who signed the relevant audit report of Deloitte, were given administrative penalties of revocation of CPA certificates, three responsible persons such as Ma Moumou were given administrative penalties of suspending their business for one year, three responsible persons such as Niu Moumou were given administrative penalties of suspension of business for 2 months, and six responsible persons such as Zong were given administrative penalties of warning.
The parties concerned to the above-mentioned penalty decisions have the right to initiate administrative reconsideration or administrative litigation, but the enforcement of the penalty decision shall not be suspended during the period of administrative reconsideration or administrative litigation. The Ministry of Finance will strengthen financial supervision, strictly enforce financial discipline, severely crack down on violations of accounting and auditing laws and regulations, strictly supervise and enforce the law, while protecting the legitimate rights and interests of enterprises and intermediaries in accordance with the law, strengthen law enforcement, strengthen the accountability of relevant responsible persons, and provide strong support for maintaining social fairness and justice, regulating market economic order, and ensuring national economic security. (Zhongxin Finance)