Financial Reports and
Other Public Communications
As a public company we are subject to various securities laws, regulations and reporting obligations. These laws, regulations and obligations and our policies require the disclosure of accurate and complete information regarding the Company’s business, financial condition and results of operations. Inaccurate, incomplete, or untimely reporting will not be tolerated and can severely damage the Company and result in legal liability.
Accuracy of Financial Reports and Other Public Communications
The Company’s principal financial officers and other employees working in the Accounting Department have a special responsibility to ensure that all of our financial disclosures are full, fair, accurate, timely, and understandable. These employees must understand and strictly comply with the applicable generally accepted accounting principles and all standards, laws and regulations for accounting and financial reporting of transactions, estimates and forecasts.
In addition, the Company shall maintain proper internal books and records and to devise and maintain an adequate system of internal accounting controls. Both the China Securities Regulatory Commission (the "CSRC") and the Securities and Exchange Commission (the "SEC") have supplemented the statutory requirements by adopting rules that prohibit:
any person from falsifying records or accounts subject to the above requirements;
officers or directors from making any materially false, misleading, or incomplete statement to an accountant in connection with an auditor any filing with both Commissions.
These provisions reflect the both commissions’intent to discourage officers, directors, and other persons with access to the Company’s books and records from taking action that might result in the communication of materially misleading financial information to the investing public.
Public Communications and Prevention of Selective Disclosure
Public Communications Generally
The Company places a high value on its credibility and reputation in the community. What is written or said about the Company in the news media and investment community directly impacts our reputation, positively or negatively. Our policy is to provide timely, accurate and complete information in response to public requests (eg, media and analysts), consistent with our obligations to maintain the confidentiality of competitive and proprietary information and to prevent selective disclosure of market-sensitive financial data. To ensure compliance with this policy, all news media or other public requests for information regarding the Company should be directed to the Company’s Investor Relations Department. The Investor Relations Department will work with you and the appropriate personnel to evaluate and coordinate a response to the request.
Prevention of Selective Disclosure
Preventing selective disclosure is necessary to comply with the relevant securities laws and to preserve the reputation and integrity of the Company as well as that of all persons affiliated with it. "Selective disclosure" occurs when any person provides potentially market-moving information to selected persons before the news is available to the investing public generally. Selective disclosure is a crime under the relevant law, especially under the United States law, and the penalties for violating the law are severe.
The following guidelines have been established to avoid improper selective disclosure. Every employee must follow these procedures:
All contact by the Company with investment analysts, the press and/or members of the media shall be made through the Chief Executive Officer or the Chief Financial Officer or persons designated by them (collectively, the "Media Contacts").
Other than the Media Contacts, no officer, director, or employee shall provide any information regarding the Company or its business to any investment analyst or member of the press or media.
All inquiries from third parties, such as industry analysts or members of the media, about the Company or its business should be directed to a Media Contact. Presentations to the investment community regarding the Company may only be made under the direction of a Media Contact.
Other than the Media Contacts, any employee who is asked a question regarding the Company or its business by a member of the press or media shall respond with "No comment" and forward the inquiry to a Media Contact.
These procedures do not apply to the routine process of making previously released information regarding the Company available upon inquiries made by investors, investment analysts, and members of the media.
Any inquiry by the CSRC or the SEC or the Nasdaq Stock Market could substantially damage the Company's reputation. Selective disclosure is a topic of intense focus with the SEC following the release of SEC Regulation FD (selective disclosure). Although foreign private issuers such as the Company are exempt from Regulation FD, the Company remains liable for selective disclosure. The Order of China Securities Regulatory Commission also requests the information to be disclosed fairly. Please contact the Compliance Manager if you have any questions about the scope or application of the Company's policies regarding selective disclosure.
