Looks like good news out today from the account front:
NINGBO, China, July 11, 2011 /PRNewswire-Asia-FirstCall/ -- Keyuan Petrochemicals, Inc. (Nasdaq:KEYP - News) ("Keyuan or the "Company"), a leading merchant manufacturer of various petrochemical products in China, announced today that the audit committee has received initial findings of its independent investigation of the Company's 2010 sales and revenue. Deloitte Financial Advisory Services ("Deloitte"), King & Wood, Pillsbury Winthrop Shaw Pittman LLP ("Pillsbury") and a petrochemicals industry expert, separately verified the accuracy of information related to the Company's 2010 sales.
On March 31, 2011, the Company's audit committee hired Pillsbury, Deloitte, and King and Wood to conduct an independent investigation of issues identified by the Company's former independent public accountant, KPMG. A team of lawyers and forensic accountants reviewed scores of documents at Keyuan's offices, visited select customer locations throughout China, and interviewed representatives of the customers, and senior officers and personnel of the Company. The independent investigators also consulted an industry expert, who has years of experience in the petrochemicals industry, to analyze Keyuan's production plants and operations.
Based on results from the independent investigation, the independent investigators made the following conclusions:
"…nothing has come to our attention to indicate that the Company has inappropriately accounted for the specific customer transactions we were able to test, other than the documentation issues notes above";(1)
"the Company-arranged interviews with selected customers supported that the customers transacted business with the Company in 2010";
"in the documents that we have reviewed, we have found no documents reflecting any intent by the Company to misstate revenues;"
"plant visit and document review by an expert in the petrochemical industry supports the finding that the plant is operating and producing petrochemicals at a quantity consistent with the revenues stated by the Company"; and
"interviews with management and selected Company personnel were consistent with the above findings."
"We are pleased with the results of the independent investigation," stated Mr. Chungfeng Tao, Chairman and Chief Executive Officer of Keyuan Petrochemicals. "The findings support our assertion throughout this process that we are an excellent company on solid financial footing with a clear and focused growth strategy. Having cooperated fully with examiners and regulators during this extensive review process, we will continue to focus on completing our 2010 and 1H 2011 audits."
(1) Please refer to Form 8-K we filed on July 11, 2011 for further information
