Scandal hit China Gaoxian reports widening losses

China Gaoxian Fibre Fabric, which has been mired in an accounting scandal, has finally released its results and they were not pretty.

Its fourth quarter net loss widened to 40.1 million yuan from 23.6 million yuan previously.

Revenue for the three months to Dec 31 slumped by 37.8 per cent to 104.1 million yuan.

For the full year, its net loss amounted to 86.4 million yuan on turnover of 491.1 million yuan. No corresponding comparison was given as the auditors could not access the group's accounting records prior to April 1, 2011, said PwC.

PwC was appointed as special auditors by China Gaoxian's audit committee on April 20, 2011 to conduct a review into the financial affairs of the China-based company.

Although PwC have completed the review, they were not able to obtain the bulk of the China Gaoxian's accounting books and records for the period prior to April 1, 2011.

As a result, the special auditors were not able to reconstruct the group's accounts as at March 31, 2011 based on the limited information provided to them.