Germany’s Siemens said it was investigating a media report that it boosted sales figures of its healthcare equipment in China by creating fake contracts

http://www.reuters.com/article/2015/03/02/siemens-china-healthcare-idUSL5N0W42IN20150302

Siemens investigates report of fictitious Chinese contracts

Mon, Mar 2 2015

FRANKFURT/SHANGHAI, March 2 (Reuters) – Germany’s Siemens said it was investigating a media report that it boosted sales figures of its healthcare equipment in China by creating fake contracts. Chinese business daily Yicai cited Chinese distributors as saying that Siemens’ healthcare division had been creating contracts with them that were not backed up by real sales. The distributors would pay a 10 percent down payment, allowing Siemens to book the contracts. Siemens would then return the payments to them by other means, Yicai said. Continue reading

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Hedge Funds Cry Foul Over Indonesian Debt Workout of PT Bakrie Telecom; they can’t vote on the workout arrangements because their defaulted notes were issued by an offshore special-purpose vehicle

http://www.bloomberg.com/news/articles/2015-03-02/hedge-funds-cry-foul-over-indonesian-debt-workout-asean-credit

Hedge Funds Cry Foul Over Indonesian Debt Workout

byChristopher Langner

March 3, 2015

(Bloomberg) — Five hedge funds are testing Indonesia’s legal protections for foreign investors after a local court barred them from PT Bakrie Telecom’s debt restructuring talks.

The funds and one other bondholder are asking a New York court to quash a ruling by a Jakarta district judge that they can’t vote on the workout arrangements because their defaulted notes were issued by an offshore special-purpose vehicle. The investors, who own 28 percent of the $380 million May 2015 dollar-denominated securities, said in the suit they will recover less than 20 cents on the dollar under the plan. Continue reading

China state-owned firms’ overseas assets are not audited

http://www.reuters.com/article/2015/03/03/us-china-audit-idUSKBN0LZ09N20150303

Posted by Joel CHUA Yong Sheng, Year 3 undergrad at the School of Business, Singapore Management University

China state-owned firms’ overseas assets are not audited: Xinhua

Mon, Mar 2 2015

SHANGHAI, Mar 3 (Reuters) – China does not audit the 4 trillion yuan ($637.42 billion) of assets its state-owned enterprises (SOE) hold overseas, Xinhua news agency reported, highlighting difficulties the government faces when expanding its anti-corruption drive to SOEs. Continue reading

Building trust as a tool to create an anti-fraud environment?

Building trust as a tool to create an anti-fraud environment?

Posted by PHOON Pei Jing, Year 3 undergrad at the School of Economics, Singapore Management University

http://www.huffingtonpost.com/cynthia-hanson/how-can-businesses-build-_b_6537670.html

http://www.businessinsider.in/Corporate-Frauds-In-India-On-The-Rise/articleshow/45899708.cms

http://www.forbes.com/2010/06/10/corporate-fraud-executive-compensation-personal-finance-risk-list-2-10-kaplan.html

http://www.reuters.com/article/2012/07/30/us-financial-sarbox-idUSBRE86Q1BY20120730

Given the rising number of fraud cases around Asia, with India seeing a rise of over 45% in corporate frauds in the last 2 years, one of the more important questions today in the business world has been about how businesses can build trust. After all, trust is key to any businesses’ performance as well as competitiveness, and building trust may even help lay the foundation to a successful anti-fraud business relationship. Continue reading

Detecting the rapidly rising number of small scale fraud cases

Detecting the rapidly rising number of small scale fraud cases

Posted by PHOON Pei Jing, Year 3 undergrad at the School of Economics, Singapore Management University

With the enforcement of the Sarbanes-Oxley Act, standards at big companies have generally improved over the past decade or so, with more effective internal controls over their financial reporting. In addition, “Accounting Quality Model”, a computer program that number-crunches reams of companies’ financial statements looking for outliers and other red flags to facilitate fraud detection have also been extensively revised. Stringent enforcement, together with streamlined process of fraud detection has helped to create an anti-fraud environment. Continue reading

Where Should SEC Start A Fraud Crack Down? Maybe Look At Fake Restatements

http://www.forbes.com/sites/francinemckenna/2013/06/18/where-should-sec-start-a-fraud-crack-down-maybe-look-at-fake-restatements/

Posted by Mildred LIANG Bei Yan, Year 4 undergrad at the School of Accountancy, Singapore Management University

Where Should SEC Start A Fraud Crack Down? Maybe Look At Fake Restatements

It’s so good to hear that the Securities and Exchange Commission plans to refocus its enforcement efforts on accounting fraud. It would be even better for investors if the regulator used all the information already available – no need to resort to fancy computer algorithms – to prosecute accounting frauds and the executives, directors and third-party aiders and abettors like lawyers and auditors. Let’s stop waiting to be roused to action by private lawsuits. Continue reading

Investing in U.S.-Listed Chinese Companies Becomes Even Riskier

http://www.theepochtimes.com/n3/1267518-investing-in-u-s-listed-chinese-companies-becomes-even-riskier/

Posted by Jelvin Tan Xiang Rong, Year 4 undergrad at the School of Accountancy, Singapore Management University

By , Epoch Times | March 2, 2015

Five years ago, Sino-Forest Corp. was one of the largest commercial forestry companies in China and a stock-market darling, attracting capital from legendary hedge fund investors such as John Paulson.

Sino-Forest owned and operated tree plantations throughout China, and manufactured and sold wood products to downstream customers. The company floated shares onto the Toronto Stock Exchange. Its stock soared as investors rushed to participate in a supposedly booming Chinese economy. At one time, Sino-Forest’s market capitalization eclipsed $6 billion.

Then it all came crashing down. Continue reading