BEIJING, Feb. 16, 2021 /PRNewswire/ -- Jianpu Technology
Inc. ("Jianpu" or the "Company") (NYSE: JT), a leading independent
open platform for discovery and recommendation of financial
products in China, today announced the results of the
previously disclosed independent review conducted by the
independent audit committee of its board of directors (the "Audit
Committee") regarding certain matters relating to transactions
between the Company and third-party business entities, and provided
an update on its financial statements review and NYSE
compliance.
The Independent Review
As previously disclosed by the Company in its Notification of
Late Filing (Form 12b-25) on June 15,
2020, the Audit Committee, with the assistance of advisers,
had been conducting an internal review of certain matters relating
to transactions between the Company and third-party business
entities. Specifically, the Audit Committee retained Paul Hastings
LLP as independent legal counsel to assist in conducting a review
of certain matters relating to transactions carried out by the
Credit Card Recommendation Business Unit of the Company (the
"Credit Card BU") with third-party business entities (the
"Review"). The Audit Committee was also assisted by forensic
accounting experts from a Big-Four accounting firm that is not the
Company's auditor which worked under Paul
Hasting's direction.
The Review is now substantially complete. The Review entailed
procedures that the Audit Committee and the above-mentioned
professional advisers, in their professional judgment, considered
necessary and sufficient to investigate the issues, including, but
not limited to, review of documents and data from multiple Company
employees (such as review of emails and other electronic files and
communications); interviews of Company employees and relevant third
parties; and analysis and testing of the Company's relevant
transactions, and books and records. The Company cooperated with
the Review.
Summary of Findings
The following is a summary of the principal findings of the
Review as of the date hereof. Unless otherwise indicated, the
Review findings generally cover the fiscal years 2017 through
2019.
The Review found that certain transactions involved third-party
agents (including both upstream agents and downstream suppliers)
with undisclosed relationships, and some transactions lacked
business substance ("questionable transactions"). As a
result, certain revenue and associated expenses were inflated or
inaccurately recorded in the financial statements. Evidence
suggested that certain employees from the Credit Card BU may have
known about or been involved in certain of the questionable
transactions that resulted in inflated sales commissions to such
employees. In relation to the questionable transactions, the
Review found that certain employees improperly altered supporting
documents that were provided to the Company's external auditor.
Other than a business unit head-level employee who has since
been terminated, the Review did not find any evidence that other
members of senior management who supervised the Credit Card BU knew
about or participated in any of the questionable transactions.
Follow-up Financial Impact Assessment
The Company is assessing the overall financial impact of the
questionable transactions on its financial statements, including
the adjustment of the revenue recognized for the fiscal years 2018
and 2019 to net-based recognition and the reversal of certain
revenue and the related costs and expenses. The Company anticipates
the total amount of overstated revenue for the fiscal years 2018
and 2019 to be approximately, RMB 90
million and RMB 164 million,
respectively, representing approximately 4.5% and 10.1% of the
total revenue previously reported by the Company for such years,
and the adjustment to overstated cost and expenses together with
the reserve for potential credit loss to be approximately
RMB 90 million and RMB 130 million for the fiscal years of 2018 and
2019, respectively, resulting in a minimal net profit impact for
the fiscal year 2018 and RMB 34
million of net loss impact for the fiscal year
2019.
The Company's consolidated financial statements for fiscal year
2018 will be restated accordingly; the previously issued audited
financial statements for the fiscal year 2018 and the auditor's
report can no longer be relied upon. Moreover, investors must
exercise caution when using the Company's previously announced
unaudited financial information for the fiscal year 2019.
Remedial Measures in Response to Review
The Company, with input from the Audit Committee and the
above-described professional advisers, has prepared a remediation
plan in response to the Review, including but not limited to (i)
disciplinary actions against employees found to have engaged in
misconduct, (ii) termination of cooperation with high-risk
third-party agencies, (iii) adjustment of the Company's internal
structure and reporting lines where appropriate, (iv) enhancement
of the Company's internal policies and controls (including the
identification and remediation of potential material weaknesses and
control deficiencies), as well as financial reporting function, and
(v) conducting follow-on reviews of additional business units that
may share similar internal controls vulnerabilities as those
identified in the Credit Card BU and taking further remedial
actions as necessary and appropriate; (vi) conducting additional
training for Company employees regarding the issues implicated in
the Review findings. The Company is in the process of
implementing the remediation plan.
Financial Statement Review and NYSE Compliance
In light of the Review's findings thus far, the Company's
previously published audited financial report for fiscal year 2018
will be restated. The Company cannot at this time provide an
estimate of the timing of completing the financial statements for
fiscal year 2019.
As previously disclosed, on July 2,
2020, the Company received a notice from NYSE Regulation
indicating that the Company was not in compliance with
Section 802.01E of the NYSE Listed Company Manual as a result
of not filing in a timely manner its Annual Report on
Form 20-F for the year ended December 31, 2019 (the "2019
Form 20-F") with the Securities and Exchange Commission.
The Company is making all efforts to complete the
aforementioned financial statement review, and intends to file the
2019 Form 20-F as soon as possible and no later than July 1, 2021 to regain compliance with
Section 802.01E of the NYSE Listed Company Manual.
About Jianpu Technology Inc.
Jianpu Technology Inc. is a leading independent open platform
for discovery and recommendation of financial products
in China. By leveraging its deep data insights and proprietary
technology, Jianpu provides users with personalized search results
and recommendations that are tailored to each user's particular
financial needs and credit profile. The Company also enables
financial service providers with sales and marketing solutions to
reach and serve their target customers more effectively through
online and mobile channels and enhance their competitiveness by
providing them with tailored data, risk management and end-to-end
solutions. The Company is committed to maintaining an independent
open platform, which allows it to serve the needs of users and
financial service providers impartially. For more information,
please visit http://ir.jianpu.ai.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "confident" and similar statements.
Statements that are not historical facts, including statements
about the Company's beliefs and expectations, are forward-looking
statements. Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement, including but not limited to the following: the
Company's goal and strategies; the Company's future business
development, financial condition and results of operations; the
Company's expectations regarding demand for, and market acceptance
of, its solutions and services; the Company's expectations
regarding keeping and strengthening its relationships with users,
financial service providers and other parties it collaborate with;
general economic and business conditions; and assumptions
underlying or related to any of the foregoing. Further information
regarding these and other risks is included in the Company's
filings with the SEC. All information provided in this press
release and in the attachments is as of the date of this press
release, and the Company undertakes no obligation to update any
forward-looking statement, except as required under applicable
law.
For investor and media inquiries, please contact:
In China:
Jianpu Technology Inc.
Oscar Chen
Tel: +86 (10) 6242-7068
E-mail: IR@rong360.com
The Piacente Group, Inc.
Jenny Cai
Tel: +86 (10) 6508-0677
E-mail: jianpu@tpg-ir.com
In the United States:
The Piacente Group, Inc.
Brandi Piacente
Tel: +1-212-481-2050
E-mail: jianpu@tpg-ir.com
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SOURCE Jianpu Technology Inc.