Subsidiary illegally issued nearly 200 million invoices fined Ideal received a letter: financial fraud?

On February 8, the subsidiary was fined 762,800 yuan for issuing 194 million yuan of invoices in violation of the law, and the Shenzhen Stock Exchange issued a letter of concern to Ideal, requesting clarification on whether the subsidiary had financial fraud in fictitious business.

　　A few days ago, Ideal disclosed the "Announcement on the Receipt of Subsidiaries<税务行政处罚决定书>", saying that Jiangsu Millennium Jewelry Co., Ltd. (hereinafter referred to as "Millennium Jewelry"), a wholly-owned subsidiary of the Company, recently received the "Decision on Tax Administrative Penalties" issued by the Third Inspection Bureau of the Nanjing Municipal Taxation Bureau of the State Administration of Taxation (hereinafter referred to as the "Tax Bureau"). Due to the violation of Millennium Jewelry, a total of 194 million yuan of invoices were issued to two new energy companies in Jiangxi Province, with a tax amount of 25.2253 million yuan and an illegal profit of 262,800 yuan, and the tax bureau confiscated 262,800 yuan of illegal gains and imposed a fine of 500,000 yuan.

　　Earlier, in September 2021, Ideal had disclosed the "Announcement on The Reply to the Inquiry Letter of the Shenzhen Stock Exchange" (hereinafter referred to as the "Reply to the Inquiry Letter"),saying that on May 25, 2020, Millennium Jewelry received the "Notice of Tax Matters" issued by the Tax Bureau, and on May 13, 2021, Millennium Jewelry submitted relevant written statements, defense reports and other materials to the Tax Bureau. As of the date of the reply, Millennium Jewelry has not received follow-up notification requirements and feedback from the Tax Bureau, and the company has not received the investigation results or penalty decisions of the relevant regulatory and law enforcement departments.

　　In this regard, the Shenzhen Stock Exchange asked Ideal to explain the specific time of receipt of the relevant administrative penalty advance notice and administrative penalty decision, and whether it was consistent with the content of the reply to the company's inquiry letter; whether the two new energy companies in Jiangxi Province and their major shareholders involved in the "Tax Administrative Penalty Decision" were related to the company, its directors, supervisors and senior management, or with the company's controlling shareholders, actual controllers, shareholders holding more than 5% of the shares and their directors, supervisors and senior management The specific circumstances of Millennium Jewelry's illegal issuance of 194 million yuan invoices to two companies include, but are not limited to: the main reasons and purposes of the illegal issuance of 194 million yuan invoices, whether there is real transaction behavior, whether the business involved is related to the main business of Millennium Jewelry, and the accounting treatment and treatment basis of Millennium Jewelry in the early stage.

　　In addition, the Shenzhen Stock Exchange also requires clarification on whether Millennium Jewelry has financial fraud in fictitious business, whether accounting errors should be corrected in the previous year's financial reports, and to measure the impact of changes in relevant financial data on the realization of Millennium Jewelry's performance commitments from 2017 to 2020, as well as the impact on the financial data of listed companies in each year.

　　Wind information shows that Ideal is a well-known jewelry brand enterprise integrating jewelry product design and development, production and processing, and brand chain, mainly using a business model that combines franchisee sales and non-franchisee distribution and sales.

　　According to the 2021 annual performance forecast, Ideal expects a loss of 600 million yuan to 785 million yuan in 2021, compared with a loss of 1.571 billion yuan in the same period last year. (Zhongxin Jingwei APP)