China Animal Healthcare Financial Documents Covering Past Four ‘Years “Stolen”

Updated on

China Animal Healthcare disclosed that a truck loaded with four-year original financial documents together other things were stolen on December 4, in one of the funniest financial filings we have ever seen.

In a regulatory filing with the Hong Kong Stock Exchange, the Board of Directors of China Animal Healthcare said stolen financial documents covers four years ended December 31, 2014.

According to the company, the truck driver was taking a lunch break when the financial documents were stolen in the Qingyuan District of Baoding City, Hebei Province. The truck driver was supposed to transport the lost documents back to the company’s headquarters in Beijing.

China Animal Healthcare created a special investigation group

China Animal Healthcare reported the incident immediately to the local public security bureau and sent staff to look for the stolen truck. The company created a special investigation group to investigate the incident, maintain close contact with the local public security bureau to search for the truck, and confirm the list of lost documents. The company’s executive director serves will lead the special investigation group.

The local public security bureau found the truck on December 12, but the financial documents were still missing. The company deployed all possible resources to locate the documents.

China Animal Healthcare said the lost documents were originally stored in its office in Shijiazhuang, which serves as its document storage center. The company decided to transfer the lost documents to its headquarters in Beijing for collation to facilitate a forensic investigation—the latest in its series of problems.

Specifically, the company stated:

The board (the “Board”) of directors (the “Directors”) of the Company wishes to inform the shareholders of the Company (the “Shareholders”) that on 4 December 2015, a truck of the Group (the “Truck”) loaded with, among other things, all original financial documents of the Group for the four financial years ended 31 December 2014 and for the current year (the “Lost Documents”) were stolen in the Qingyuan District of Baoding City, Hubei Province, China while the truck driver was taking a lunch break on his journey to transport the Lost Documents back to the Group’s head office in Beijing (the “Incident”). The Lost Documents were originally stored in the Group’s office in Shijiazhuang, being the document storage centre of the Group. On 3 December, the Group made arrangements to transport the Lost Documents back to the Group’s head office in Beijing for collation in order to facilitate, among other things, the Forensic Investigation. At around noon of the same day, the Truck broke down and was towed to a car repair garage in Qingyuan District for repair. On 4 December at around 11:30 a.m., the driver of the Truck picked up the Truck from the garage after repair and went for lunch at a nearby restaurant. The Truck driver discovered after lunch that the Truck was stolen.

Immediately after the Incident took place, the Group made a report to the local public security bureau and sent staff to search for the Truck in the direction the Truck had gone according to the road monitoring system of the local public security bureau. Given the gravity of the Incident, the Group convened a meeting on 5 December 2015 with the driver of the Truck and other relevant personnel of the Group to inquire further into the Incident, as well as set up a special investigation group (the “SIG”) accountable to the Board which is headed by Mr. Li Jun, an executive Director, to (i) investigate into the Incident, (ii) maintain close contact with the local public security bureau to search for the Truck, and (iii) confirm the list of Lost Documents and follow up on this matter.

Based on the findings of the investigation by the SIG, no suspicious person has been identified in the Incident. According to the local public security bureau, thefts such as the Incident are common occurrence in the Qingyuan District. On 12 December 2015, the Company was notified by the local public security bureau that the Truck was found but not the Lost Documents. As at the date of this announcement, although the possibility of finding the Lost Documents is not high, the – 3 – Group has nonetheless deployed all possible resources in search of the Lost Documents. Since the occurrence of the Incident, the finance team of the Group has been actively inquiring from different sources to retrieve as many copies of the Lost Documents as possible in order to minimise the impact of the Lost Documents. At the same time, the management of the Company has communicated to the Forensic Accountant on the Lost Documents, so as to minimize the impact on their work. Further investigation by the SIG of the Incident is currently in progress. The Company will publish further announcement(s) to update the Shareholders when there is further development on the Incident.

Other woes

The trading of the company’s stock has been suspended since March 30, pending the release of financial results for 2014. In September, Deloitte Touche Tohmatsu resigned as auditor of China Animal Healthcare. The accounting firm resigned due to the alleged misconduct on the part of the company’s employee and their disagreement on certain specific steps related to the additional audit procedures.

In October, the local authorities in Hebei Province revoked some of the production permits and manufacturing certificate of the company due to safety and environment concerns.

The local authorities also ordered China Animal Healthcare to relocate some of its facilities away from residential areas.

Sounds about right….

Signup to ValueWalk!

Get the latest posts on what's happening in the hedge fund and investing world sent straight to your inbox! 
This is information you won't get anywhere else!