Haike moves to correct major accounting error

6th Sep 2016 16:15

(ShareCast News) - A major accounting error forced Haike Chemical Group to correct its anticipated interim results on Tuesday, to the tune of hundreds of millions of yuan renminbi.The AIM-traded firm had provided an update to the market on 20 July 2016, claiming it had delivered unaudited revenue of CNY 526.9 million and net profit of CNY 11.4 million for the six months to 30 June."Due to an administrative oversight, this unaudited revenue figure did not incorporate a net-off of transactions between Haike and two companies, Shandong Hi-Tech Chemical Group Ltd. and Haiyuan Trading Pte. Ltd., which had been disposed as part of the company's restructuring to divest its non-core and loss-making refining business in June 2014," the company said in a statement."Consequently, under the company's agreed accounting policies, transactions with these two companies are recognized on a net method."As a result, the Haike's unaudited revenue for the six months ended 30 June is now expected to be CNY 350.7 million, down from CNY 385.4 million a year earlier."The company confirms that this correction does not affect underlying profitability."Haike expects to deliver a net profit of CNY 11.4 million for the six months ended 30 June 2016, as previously announced."It wasn't the only blunder on the figures, however, as Haike also noted that the comparative results stated in the 20 July announcement were figures for the 12 months ended 31 December 2015.Haike said it now expects to announce its interim results for the period ending 30 June at the end of September.