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Auditors reveal truth about State assets firms
(Xinhua)
Updated: 2005-01-22 03:06 Auditors found malpractice
involving 6.7 billion yuan (US$810.16 million) at four State-owned assets
management companies, the National Audit Office announced on Friday.
The offi ce uncovered 38 cases of illegal operations and problems in the
Huarong, Orient, Cinda and Great Wall companies. Friday's edition of Beijing
News reported that the Auditor-General, Li Jinhua, told a national meeting of
government auditors early this month that the four companies had bought
non-performing loans that had little chance of being repaid, to help disguise
illegal operations.
Auditors also found back door dealings used to clear bad assets. For
instance, the banks sold non-performing assets at a lower price than they should
have, leading to a loss of State assets, Li said.
Some companies had committed fraud by reporting fake financial figures and
misusing funds for employees' salaries and subsidies, he said.
The Chinese Government founded the four companies in 1999 to clear the bad
assets that had been left by four State-owned commercial
banks.
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