Well, if that won't light the rumor mill on fire, I don't know what will.
Let's see the press release:
NQ Mobile (NYSE: NQ), a leading global provider of mobile Internet services, today announced that it has engaged Marcum Bernstein Pinchuk LLP (MBP) as its independent Registered Public Accountant.
The Company's Audit Committee has dismissed PricewaterhouseCoopers Zhong Tian LLP (PwC) as its Independent Auditor. Effective immediately, the Company's Audit Committee has engaged MBP as its new Independent Auditor with respect to the fiscal year 2013 and subsequent periods.
Following consultation with PwC, the Company's Audit Committee confirms that there is no disagreement between the Company and PwC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure.
Sounds benign to me. Clients fire their auditors all the time for totally legit reasons, like, uh… the auditor asking too many damn questions?
PwC advised the Company and the Audit Committee that the observations referred to in the Company's press release reporting on the Special Committee's Independent Investigation dated June 4, 2014 regarding questions related to electronic data collected by the Investigation Team would require it to expand the scope of its work and, if investigated further, may cause it to be unwilling to rely on management representations in connection with its audit work.
The Audit Committee has carefully considered the additional procedures proposed by PwC. The Audit Committee notes that PwC informed the Company and Audit Committee that as part of those procedures it would seek among other things information that is not in the possession, custody or control of the Company. For example, PwC has requested that the Company provide PwC with access to multiple third parties' original bank statements and financial records.
Wait a second, that doesn't sound good. The June 4, 2014 press release in question refers to a special committee formed at NQ Mobile to investigate Muddy Waters' fraud allegations, which have been annoying the crap out of NQ Mobile like a fly buzzing around the potato salad at a summer picnic. Mainly, the investigation "did not find any evidence that the Company had engaged in the fraudulent conduct alleged by Muddy Waters" because of course it didn't. PwC, however, was like "cool, guys, can we see your work to verify that?" and NQ Mobile is like "LOL no."
Not only that, but it's, like, hard and stuff to get what PwC wants so firing them is probably just easier. Hopefully the new auditors won't be nearly as annoying and demanding as these PwC Zhong Tian clowns.
Furthermore, PwC has advised the Company and the Audit Committee that, depending upon what PwC learns from the procedures performed pursuant to its expanded audit scope, there may be other or additional information that it would need. The Audit Committee has concluded that PwC's proposed procedures may create risk for the Company with respect to the Company's obligation to file its Form 20-F for the year 2013.
Gah, those freaking auditors, always wanting to verify shit.