On February 22, Nanshen, a reporter from China** Daily, announced the creative information and received a notice from the public security organ to file the case. Previously, the company's total amount was as high as 3The large contract of 6.4 billion yuan was only recovered less than 40 million yuan, and the company found suspected illegal and criminal acts in the process of collecting the payment, and the case was filed on January 19, 2024. In response to the incident, the regulator quickly intervened and issued a letter of concern to Creative Information on the morning of February 23, requiring the company to explain in detail the specific circumstances of the fraud and the impact on the company's main financial indicators and accounting subjects in the past three years. The Shenzhen Stock Exchange also requires the company to self-examine whether there are serious deficiencies in internal control and whether there are any risk matters that should be disclosed in other contracts signed. The regulator also requires the company's annual audit accountant to explain the audit situation, and whether the company is found to have financial fraud, profit adjustment or capital occupation by related parties. Creative Information's main business is the integrated development of data network systems and technical services for data network systems, and its performance has been losing money in recent years. Even in a profitable year, the non-net profit deducted in 2017 at the peak was only 15.5 billion yuan, less than half of the amount defrauded. 3.6.4 billion yuan contractThe collection is less than 40 million yuanJudging from the information disclosed in the creative information announcement, the origin of the matter dates back to 2022. On November 25, 2022, the company signed seven "Material Procurement Contracts" with State Grid Sichuan Comprehensive Energy Service *** hereinafter referred to as "Sichuan Comprehensive Energy"), with a total amount of 36.4 billion yuan. On December 29, 2022, Sichuan Zongneng paid the payment of 1998$830,000 and $19,000,000, and subsequent unpaid amounts. In order to ensure that the company recovers the remaining money in a timely manner, the company has communicated with Guoning Ruineng Green Energy Technology Co., Ltd., the owner of the purchase of goods from Sichuan Comprehensive Energy, on the payment of the "Material Procurement Contract", and the latter agreed to pay the remaining amount unpaid directly to the company. On November 30, 2023, the company signed a "Cooperation Agreement" with Guoning Ruineng, stipulating that the latter will unconditionally pay the remaining payment to the company in three installments on December 8, 2023, December 20, 2023 and December 28, 20232.5 billion yuan. However, on December 8, 2023, the company did not receive the first payment due from Guoning Ruineng, and the payment has not been returned after many subsequent communications. Subsequently, the company filed a lawsuit and property preservation against Guoning Ruineng and its shareholder Tianjin Guoning Ruineng***. According to the "Civil Ruling" and "Property Preservation Notice" issued by the court, it was agreed to freeze the five bank accounts of Guoning Ruineng, with a limit of 32.6 billion yuan, but the total amount of funds actually frozen is only 1990,000 yuan. Combined with the property preservation situation of Guoning Ruineng, after soliciting the professional opinions of the lawyer team, in order to protect the rights and interests of the company, the company reported the case to the public security organ in January 2024. After reporting the case, on February 19, 2024, the company received the "Notice of Case Filing" delivered by the Qingyang District Branch of the Chengdu Municipal Public Security Bureau, the main content of which is: The Qingyang District Branch of the Chengdu Municipal Public Security Bureau believes that the case of "240119 contract fraud" reported by the company meets the criteria for filing a case, and is now established as a "240119 contract fraud case". 
The regulator sent a letter quicklyFocus on three areasThe day after the creative information announcement was filed, the Shenzhen Stock Exchange quickly issued a letter of concern to the company on the morning of February 23, requiring the company to explain three major matters. 
First, the company is required to give a detailed description of the specific circumstances of the company's fraud as of the date of the reply letter, including but not limited to the type of business, the products involved, the means of fraud, the specific content of the suspected illegal and criminal acts, the time when the company was discovered, the amount of funds involved, the final flow of funds, the progress of the case, and the impact on the company's main financial indicators and accounting subjects in the past three years. Second, the company is required to further self-examine the implementation of the internal control system in the process of contract signing and fund payment approval, whether there are serious deficiencies in the company's internal control, whether there are risk matters that should be disclosed in other contracts signed by the company, the possible impact on the company and the countermeasures to be taken. Third, the company's annual audit accountant is required to explain the audit procedures and audit evidence that have been carried out on the company's fraudulent matters, the verification of the authenticity of the book amount of relevant income, accounts receivable, prepaid accounts and other accounts, the verification methods adopted, the supporting materials obtained, the problems found and the conclusions, whether there are audit restrictions, and whether the company is found to have financial fraud, profit adjustment or capital occupation by related parties. The Shenzhen Stock Exchange requires the company to make a written explanation on the above matters, and submit the relevant explanatory materials and disclose them to the public before March 1, 2024. The highest loss in 2023 is 4500 million yuanHow much impact did the event have on the creative message? As early as January 30, the company released its 2023 performance forecast, and there will be huge losses without surprises. On January 30, Creative Information released the 2023 annual performance forecast, saying that the company expects to increase losses from January to December 2023, and the net profit attributable to the parent company is expected to lose 3500 million yuan-4500 million yuan, deducting non-net profit is expected to lose about 3700 million yuan-4700 million yuan. 
The main reason for the loss is that the company intends to fully accrue bad debts for the accounts receivable of the aforementioned contract, reducing profits by about 32.5 billion yuan. The company said that according to the communication with Sichuan Zongneng and Guoning Ruineng and the progress of related cases, the credit risk of the accounts receivable has increased significantly, and the company has made a provision for bad debts in full for the accounts receivable in combination with the company's judgment on the difference between the amount expected to be received and the amount to be charged according to the contract. In addition, the company said that in 2023, the company continued to increase R&D investment, the strategic losses of core businesses such as databases and satellite Internet increased, and the amortization of expenses generated by the company's employee stock ownership plan in 2023 was about 25.02 million yuan, all of which increased the losses in 2023. Creative Information's main business is carrier-grade data network system solutions and technical services, which are divided into two categories: data network system integrated development and data network system technical services. In recent years, the company's main business income has stagnated, basically hovering around 2 billion yuan, and from 2020 to 2022, the company's net profit has been in the red for three consecutive years. 
The latest market value of creative information is about 6 billion yuan, a significant decrease from the peak of nearly 20 billion yuan. 
Edit: Captain's Review: Muyu.