Today marks thecountdown to the world being ruled by Skynet10495days
Hello comrades, I am a time traveler from thirty years in the future, Dai Fei.
Disclaimer: This article is a personal diary and does not constitute investment advice.
As the saying goes in the “Youth Daily”: “When the camera focuses on the treetops, those ‘urban neighbors’ that usually rush by reveal entirely different life details.” In the jungle of capital, what we need is not a feast, but a sober and careful analysis.
There is only one day left until the annual report season ends.
What is the purpose of life? Eating well and sleeping soundly is the ultimate wealth. But if one has a fortune yet cannot sleep at night or eat properly, what is the difference from being a walking corpse?
I shared with comrades long ago that during the annual report explosion season, it is better to avoid and come back later; how many actually did it?
Speaking of C, we bought after the last limit down and sold most at the high opening the next day, then sold at the high point yesterday before the limit down at the end of the day; today should be another profitable day.
As for those who followed, they probably bought and did not move, enduring the pressure of the explosive financial report; fortunately, it was released relatively early last night.
1. Overview of Audit Opinions
Type of Audit Report: Issued a qualified audit report
(XYZH/2025GZAA1B0612).
Scope of Audit: Audited the consolidated and parent company balance sheets, income statements, cash flow statements, changes in shareholders’ equity, and related notes for the fiscal year 2024 of Super Communication Company.
2. Content of Non-standard Audit Opinions in the Report
Content of Qualified Opinion
Involving accounts receivable and other receivables: As of December 31, 2024, the balance of accounts receivable and other receivables from a single customer due to computing power business transactions in the consolidated balance sheet totaled 522.31 million yuan, with a provision for bad debts of 52.23 million yuan, which has not been fully recovered as of the audit report date.
Customer’s ability to pay is in doubt: The actual controller of the customer has promised to assume unlimited joint liability for unpaid amounts, but its ability to pay cannot be verified, leading to an inability to obtain sufficient and appropriate audit evidence regarding the recoverability of receivables and the reasonableness of the provision for bad debts, creating uncertainty about whether adjustments to related financial statement items and disclosures are necessary.
Content of Explanatory Paragraph
Significant uncertainty regarding going concern: The net loss attributable to shareholders of the parent company for the fiscal year 2024 was 61.76 million yuan, with a net cash flow from operating activities of -133.72 million yuan, a debt-to-asset ratio of 90.58%, current assets of 2.14 billion yuan, current liabilities of 2.35 billion yuan, and current liabilities exceeding current assets by 212.50 million yuan. Additionally, the notes to the financial statements mention other liquidity risk issues, indicating significant uncertainty regarding the ability to continue as a going concern, but management has disclosed countermeasures, and this does not affect the audit opinion already issued.
3. Reasons and Basis for Issuing Non-standard Audit Opinions
Reasons and Basis for Qualified Opinion
According to the “Chinese Certified Public Accountant Auditing Standard No. 1502”, a qualified opinion should be issued when there is sufficient and appropriate audit evidence that indicates a misstatement has a significant but not pervasive effect on the financial statements, or when sufficient and appropriate audit evidence cannot be obtained but it is believed that undetected misstatements could have a significant effect on the financial statements but not pervasive.
The qualified opinion involves accounts receivable, other receivables, and credit impairment losses which are relatively few and do not have a pervasive effect on the financial statements of Super Communication Company for the fiscal year 2024.
Reasons and Basis for the Significant Uncertainty Related to Going Concern
According to the “Chinese Certified Public Accountant Auditing Standard No. 1324”, if the going concern assumption is appropriate but there is significant uncertainty and the financial statements have been adequately disclosed, a clean opinion should be issued with an additional separate section.
Super Communication Company has adequately disclosed the significant uncertainty related to going concern in the notes to the financial statements, thus it does not affect the audit opinion issued.
4. Impact of Matters Involving Qualified Opinion on Financial Position, Operating Results, and Cash Flows
Due to the inability to obtain sufficient and appropriate audit evidence, it is not possible to determine the potential impact amount of the matters involving the qualified opinion on the financial position and operating results of Super Communication Company during the reporting period, but this matter will not change the nature of profit and loss for the fiscal year 2024.
5. Overall Materiality Level of Consolidated Financial Statements
Selection Basis and Rationale: Gross profit was selected as the basis, as Super Communication Company had a pre-tax loss for the fiscal year 2024 and the pre-tax profit of its recurring business has been unstable in recent years, making pre-tax profit unsuitable as a basis. As a listed company, financial statement users are more concerned about profit margins and profitability.
Calculation Result: Calculated at a percentage of 1%, the materiality level is 1.74 million yuan, with the basis and percentage being the same as the previous year.
Overall, the issues related to the qualified opinion are not significant and are much better than being unable to issue an opinion.
However, one thing I am particularly concerned about is,the advance payments are 0 while prepaid expenses have significantly increased.
Generally, a good business should have everyone prepaying to buy, which is why I am still adopting a strategy of arbitrage and selling before hitting the limit, securing profits before observing the business model.
Considering that short-term trading is not suitable for most people, I will write about medium to long-term investments and ETFs, as well as poetry and distant horizons beyond investment in the near future.
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