NIV / CIL - looking grim
MaloneBailey's resignation letter:
In our resignation letter dated March 24, 2011, MaloneBailey cited that MaloneBailey found accounting fraud and irregularities in forging accounting records and bank statements during 2010 NIVS audit. On March 21 with email and On March 22, 2011, MaloneBailey, LLP, informed Charles Mo, NIVS independent board member and the chairman of the audit committee about "significant difficulties encountered during the 2010 audit." During the conversation, MaloneBailey, LLP informed Mr. Mo that two other public companies audits were conducted at the NIVS accounting department location. These two companies are located in Beijing and Guangzhou. However, their books and records were shipped to NIVS accounting department and MaloneBailey conducted the audits of these two public companies at NIVS accounting department. NIVS accounting personnel were involved in coordinating the two audits. MaloneBailey found accounting fraud and irregularities in these two audits. After the discovery, we encountered difficulties with management trying to limit our scope of the NIVS audit. We told Mr. Mo that we suspected accounting irregularities and fraud at NIVS but cannot audit through the issues due to the difficulties encountered during the audit. On March 23, 2011, the audit partner of MaloneBailey informed the CFO of NIVS that MaloneBaiely is writing a letter to the board of directors and the audit committee about accounting irregularities and difficulties encountered during the NIVS audit. We subsequently issued such letter.
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So I assume one of the other "two public companies" should be CIL. And the second one is open for guesses.
