Corn starch producer China Sun Bio-Chem Technology listed on the Singapore Exchange in November 2004. Financial performance began to deteriorate in FY08 with the company issuing a series of profit warnings from 1H08 through to 4Q08 which led to a collapse in its share price. In February 2009, the company announced a delay in the release of its FY08 financials owing to PwC's in ability to determine the validity of various payments and receivables. Chinese management subsequently obstructed a forensic investigation and stopped communicating with the board. While the company was clearly faking profits in FY08, it is not clear for how long it had been doing this. China Sun triggered our Fake Cash Flow Fraud model intermittently but consistently trigged our Operating Cash Flow Reconciliation model as cash flows ended up in receivables and restricted cash. The company is a confirmed fraud. 

Last updated February 2022

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