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NQ Mobile Inc. Message Board

  • biotechwatcher biotechwatcher Jul 8, 2014 9:12 AM Flag

    sanity check for longs

    Amid all the short noise and clamor, longs need to remember that NQ has only one blemish on its record--late filing of the 20f.

    Granted, a late filing is one huge blemish, but there are underlying causes for the blemish, including the completion of a forensic audit that places PWC, as financial auditor, under elevated pressure and scrutiny.

    My take? The forensic audit was published early June. Six to eight weeks after publication of the forensic audit would not be an unreasonable time period for completion of the financial audit. My backup for this opinion is a dialog with a longtime forensic auditor at Grant Thornton.

    Also not surprising PWC is demanding an expansion of the audit. All eyes on them--especially if the forensic audit pointed out some lax accounting practices PWC should have called out in past years. I've posted this before, but the extensive forensic audit of NQ is also an extensive audit of PWC's performance.

    I get it--shorts are screaming from the rooftops: delays can only mean fraud or a devastating restatement.

    But there is another explanation: financial audits on top of forensic audits just simply take time. Nobody likes it, but that's the way it is, and there is really nothing surprising here at all.

    Meanwhile, we can buy NQ at a share price roughly equivalent to its cash position. Works for me.

    Sentiment: Buy

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