Shenzhen Stock Exchange recently publicly condemned Wanfu Biotechnology (Hunan) Agricultural Development Co., Ltd. and its directors, supervisors and senior managements for the false record and material misstatement in the company’s 2012 semi-annual report. The sponsor representatives of the company during the continuing supervision and guiding period have also been reprehended in a Circular of Criticism. This is the second case of public condemnation appeared in Chinext Market.
On October 26, 2012, Wanfu Biotechnology issued major correction and supplementary announcement concerning its 2012 semi-annual report, acknowledging that it had disclosed a false increase of 188 million Yuan in revenues, a false increase of 146 million Yuan in operating cost, a false increase of 40.2316 million Yuan in net profit, presenting a false gains or loss in its semi-annual report 2012. Meanwhile, the company’s shut down of recycling economy grain deep processing production line in the first half year of 2012 for the reason of technology transformation resulted in a major influence on the company’s business. However, the company failed to fulfill the obligation of disclosing the major event in time, and failed to disclose the information in its 2012 semi-annual report as well. After the revelation of the above violation actions, Shenzhen Stock Exchange launched disciplinary procedures on Wanfu Biotechnology in no time in the light of Rules on Listing on Chinext, and Standard on Public Condemnation, and issued pre-penalty notice to Wanfu Biotechnology and persons concerned, which underwent affirmative defense within the appointed time. The above punishment on the company is made by Disciplinary committee of the Exchange in accordance with the relevant regulations. According to the relevant principal of Shenzhen Stock Exchange, the Exchange have always been dedicated in maintaining an open, equitable and fair market order, determined in cracking down and curbing the violations of laws and regulations, constantly enhancing the transparency of the market, and facilitating the sound development of Chinext. The public condemnation on Wanfu Biotechnology and persons concerned reflects that Shenzhen Stock Exchange supervise the market in the light of the law and regulation, and fiercely crack down the malignant behaviors such as false record, material misstatement. Meanwhile the punishment also serves as an alert to the public companies including Wanfu Biotechnology that listed on Chinext Board so as to strictly standardize the their own behaviors and facilitate the standardized and sound development of Chinext Market.
It is reported that Wanfu Biotechnology is still under investigation. Further supervising measures are not excluded to be taken on the company and persons concerned in the light of the investigation result by the supervising department.