“Chinese Accounting Tricks” Detailed on NY Times Website.

An article appeared on the New York Times website on August 17th describing “Chinese accounting tricks.” The author of the article, Mark Dixon, is founder of a London-based mergers and acquisitions advisory, The 1 Advisers Limited, and has more than 20 years experience in M&A, including with Chinese companies. In the article Mr. Dixon chronicles a specific case where he was as an advisor on the sale of a Chinese company. Drawing on this and other experiences, he found that managers of Chinese companies skewed revenue, expenses and earnings figures so much that the managers themselves were not sure of what their firm’s “true profit” actually was.

Dixon states, “The gymnastics they do with revenues and costs are so impressive that the Beijing Olympics should have added an event especially for accountants.” Dixon goes on to state, “Someone who behaves like a traditional, polite accountant will never find out the truth,” and “Every stone I turned over seemed to reveal not a single spider but countless additional stones, each of which needed to be investigated.”

To read the full article, click here.

Reports previously issued by asensio.com on China Sky One Medical, Inc. (NASDAQ: CSKI) have raised questions about the quality of CSKI’s reported financial results, especially in terms of inventory, gross margins and average sales prices, a potential undisclosed related party, relationships with suppliers, and major discrepancies between financial statements filed with the Chinese government and the U.S. Securities and Exchange Commission. To view all asensio.com reports on China Sky, click here.