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China Education Alliance Inc. Message Board

  • j.unni j.unni Sep 22, 2010 2:29 PM Flag

    Put the accounting concerns to rest

    So I feel that most of us have some concerns about the accounting at this company. Does anyone know how to access the Balance Sheet and Profit Loss Statements submitted the SAIC, the regulatory authority in China?

    All Chinese companies owned by a foreign entity must report their balance sheets and profit loss statements to the SAIC. This would include Zhong He Li Da and other subsidiaries of China Education Alliance. If one of us can get a hold of these and compare the incomes and cash holdings reported there to those reported to the SEC, it would shed some light on the accounting procedures used.

    I suggest this after an investigation of CSKI, China Sky One Medical. This company is under investigation for fraud and has used CEU's auditor (Sherb and Co.) in the past., a website devoted to investigating CSKI, exposes discrepancies between the reported income of CSKI's subsidiaries in the SAIC and SEC documents. The site seems to suggest that if the incomes are reported the same to both the American and Chinese regulatory bodies, the information will be more trustworthy, and I concur.
    If we can gain find out what ZHLD and other subsidiaries have been reporting, we may be able to figure out once and for all if CEU is the real deal, to be ridden out to huge profits, or if it is a scam, to be dropped now.

    The SAIC site is in Chinese, and the English version is only a vague description of its services. Further, I believe the submitted documents may be in Chinese as well. I have e-mailed the SAIC requesting these documents, but I have low confidence as to the result, and I cannot read Chinese.
    An additional venue for research may be credit reports for the subsidiaries, namely Harbin Zhong He Li Da Education Technology, Inc and Heilongjiang Zhonghe Education Training Center. I have sent an e-mail to requesting these. ( is where got its reports on CSKI subsidiaries). These reports are in English.

    If any one has any comments on this, please post. I would really like to get to the bottom of this, and I am sure there are many of you who would like to as well.

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    • Chinese microcaps,and reverse merger microcaps in particular,have a universal taint right now. CCME has a top 4 auditor and it can't shake the taint. CHBT has an investor day showing off bank statements etc and it can't shake the taint. And that's not to say that CEU shouldn't hire a top 4 auditor. They should. But right now,investors just don't want to believe.

    • The moment anyone mentions SAIC or Waldo Mushman you have two choices.

      1) Hold your ground but expect the PPS to get hammered.
      2) Run for the hills and give these equity terrorists their way.

      SAIC is a business license that Chinese businessmen don't like giving real #'s to because it is readily available to their competition.

      The following is a link from CGA's response to the face of the China short syndicate, Mushman Inc.

      If you're in the mood for varied opinions you could go to the CHBT board and run a search on SAIC. It is a, shall we say, heated debate.


    • I agree with you 100%.

      Are they a take over target? Hell yes!

      This is a well run company. They are opening Six New Tutoring Centers in Beijing and only spending 3 million which can be financed using 1/3 of their free cash flow.

      They don't sell fish or food that can spoil.

      I am a day trader and have traded CEU at least 8 round trips however I am going to hold my 1300 shares for the long haul.

      Accounting is not a problem.