A paper presented in August at the annual meeting of the American Accounting Association in Anaheim, Calif., found that “the current Sino-phobic reaction to Chinese reverse mergers may be overblown.” In an effort to assess the performance of these often maligned companies, the study concluded that “as an asset class, Chinese reverse-merger firms (CRMs) have performed as well as or better than comparable firms already listed in the same exchanges in the United States. CRMs also perform much better than U.S. RMs on multiple dimensions, even after many CRMs were delisted or demoted due to recent scandals. The emerging picture is that, despite a higher incidence of accounting problems, the CRMs are more mature and less speculative than their U.S. counterparts.” [AT]
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A new Financial Times report once again makes EY look completely incompetent as the auditors of the ill-fated German payments company Wirecard: EY was warned in 2016 by one of its own employees that senior managers at Wirecard may have committed fraud and one had attempted to bribe an auditor. The revelation that an EY […]
Earlier this month, Commerzbank, Germany’s second-largest lender, and DWS Group, Deutsche Bank’s asset-management arm, both decided against using EY Germany as their auditor because they were freaked out by how bad this Wirecard accounting scandal has become. This was followed by EY Global Chairman and CEO Carmine Di Sibio sending a letter to clients, expressing […]