Financial Services Association, May 12. On May 11, the Beijing Securities Regulatory Bureau issued an announcement. Due to issues related to *ST Meishang's 2017 financial statements audit project, it decided to issue a warning letter against the company's auditor Guo Xiang's relevant irregularities.

According to the announcement, Guo Xiang did not maintain reasonable doubts during the audit; did not pay attention to the discrepancies between bank statements and bank inquiries; did not further inquire with Meishang Ecology about the reasons for not deducting the audit and certification fees and evaluating the authenticity of the bank inquiry letter; did not maintain effective control over the correspondence, failed to detect or effectively respond to the highly abnormal situation of the enterprise inquiry letter; and the project visit work was formalistic.

Guo Xiang, as the certified public accountant signed for the Meishang Ecological Audit Program, violated the regulations. The Beijing Securities Regulatory Bureau decided to take administrative supervision measures to issue a warning letter against Guo Xiang and record it in the securities and futures market integrity file. Guo Xiang shall submit a written report on the rectification situation to the Beijing Securities Regulatory Bureau within 30 days from the date of receipt of this decision.

It is worth noting that the former 100 yuan share Meishang Ecology will soon be delisted. On the evening of May 9, *ST Meishang announced that the company received the “Advance Notice” issued by the Shenzhen Stock Exchange. From April 8, 2024 to May 8, 2024, the closing price of the company's shares was below 1 yuan for 20 consecutive trading days. In response to the termination of stock listing as stipulated in section 10.2.1 (1) (2) of the Shenzhen Stock Exchange's “GEM Stock Listing Rules (2024 Revision)”, the Shenzhen Stock Exchange plans to decide to terminate the company's stock listing transaction.

In recent years, *ST Meishang has also frequently fallen into a “vortex” of manipulating stock prices, illegal credit disclosure, and fraudulent issuance.

In February of this year, *ST Meishang's controlling shareholders also received an “Administrative Penalty Decision” issued by the Securities Regulatory Commission due to joint private equity manipulation of their own shares. Wang Yingyan, the chairman of the company at the time, and Ji Yun, the legal representative of private equity, were administratively fined 5 million yuan and 3 million yuan respectively by the Securities Regulatory Commission.

According to the announcement, from June 12, 2018 to July 3, 2020, *ST Meishang Female Chairman Wang Yingyan and Ji Yun, the legal representative of Shanghai Yongshu Asset Management Co., Ltd., actually controlled 113 securities accounts including “Wu”, continuously traded “Meishang Ecology” and manipulated “Meishang Ecology”. During the manipulation period, the account group purchased a total of 3.14 billion shares, with a purchase of 39.984 billion yuan; sold 3.138 billion shares and sold 39.798 billion yuan, with a cumulative transaction volume of nearly 80 billion yuan. After deducting commissions and related taxes, the account group lost a total of about 238 million yuan.

A lawsuit was filed by the Securities Regulatory Commission due to a breach of credit disclosure. On the evening of April 21, 2024, *ST Meishang issued an announcement. Due to irregular financial accounting and failure to fulfill information disclosure obligations in accordance with regulations, the company was recently ordered to take corrective regulatory measures by the Shenzhen Securities Regulatory Bureau. Meanwhile, due to suspected illegal information disclosure, the company was filed by the China Securities Regulatory Commission on April 19, 2024.

Furthermore, *ST Meishang continuously inflated net profit before and after listing, suspected illegal disclosure and fraudulent distribution of information. By 2020, the company had inflated profits totaling 457 million yuan for 9 consecutive years.

In 2012, Meishang Ecology's inflated net profit was 117.12,700 yuan, and the inflated net profit accounted for 16.56% of the net profit disclosed in the current period;

In 2013, Meishang Ecology's inflated net profit was 16.523 million yuan, and the inflated net profit accounted for 16.31% of the net profit disclosed in the current period;

In 2014, Meishang Ecological inflated net profit of 7.6715 million yuan, and inflated net profit accounted for 7.12% of the net profit disclosed in the current period;

In 2015, Meishang Ecology's inflated net profit was 667.274 million yuan, and the inflated net profit accounted for 60.52% of the net profit disclosed in the current period;

In 2016, Meishang Ecology's inflated net profit was 64.011,111 million yuan. The inflated net profit accounted for 30.64% of the net profit disclosed in the current period;

In 2017, Meishang Ecology's inflated net profit was 78.3524 million yuan, and the inflated net profit accounted for 27.58% of the net profit disclosed in the current period;

In 2018, Meishang Ecology's inflated net profit was 148.278 million yuan, and the inflated net profit accounted for 38.34% of the net profit disclosed in the current period;

In 2019, Meishang Ecology's inflated net profit was 584.356 million yuan, and the inflated net profit accounted for 27.20% of the net profit disclosed in the current period;

In the first half of 2020, Meishang Ecology's inflated net profit was 5.337 million yuan. The inflated net profit accounted for 13.85% of the net profit disclosed in the current period.

Financial fraud led to false records in documents such as *ST Meishang's 2015 initial public offering of shares and listing on the GEM prospectus, 2015 annual report, 2016 non-public offering of shares and payment of cash to purchase assets and raise supporting capital and related transactions, the 2017 public offering of corporate bonds to qualified investors, and the 2018 non-public stock listing notice.