Gelonghui, May 13 | Tefa Information (000070.SZ) said on the investor interactive platform that due to the counterparty using illegal means to adjust the performance indicators of Dongzhi Company, which was the target of the acquisition, during the gambling period, the financial indicators disclosed by the listed company passively falsely recorded. As a result, the company received the “Advance Notice of Administrative Penalties and Market Prohibition” issued by the Shenzhen Regulatory Bureau of the Securities Regulatory Commission on May 10, 2024. According to the latest “Stock Listing Rules” promulgated on April 30, 2024, the Shenzhen Stock Exchange issued other risk warnings on the company's shares regarding the content of the “Administrative Penalties and Advance Notice of Market Prohibition” issued by the Shenzhen Regulatory Bureau of the Securities Regulatory Commission. The company received the “Advance Notice of Administrative Penalties and Market Ban” issued by the Shenzhen Regulatory Bureau of the Securities Regulatory Commission on May 10, 2024, showing that after the company acquired 100% of the shares of Dongzhi Company (later renamed Dongzhi Company) in 2015, the counterparty inflated Dongzhi Company's revenue, inflated or undermined the operating costs and profits of Dongzhi Company by adjusting operating costs over time and fictitious business in order to complete the subsequent performance. As a result, the company's total profit from 2015 to 2018 inflated, and the total profit in 2019 was reduced. As of 2019, there were false records in the Annual Report, which is suspected of violating the provisions of the Securities Law. On April 30, 2024, the Shenzhen Stock Exchange promulgated the latest “Stock Listing Rules”, which stipulate that the exchange imposes additional risk warnings on shares of listed companies. Section 9.8.1 (8) stipulates: “According to the facts set out in the China Securities Regulatory Commission's administrative penalty advance notice, the financial indicators in the annual report disclosed by the company are falsely recorded, but they do not touch on the circumstances stipulated in section 9.5.2 (1) of these rules. The aforementioned financial indicators include operating income, total profit, net profit, and assets or liabilities in the balance sheet. Other risk warnings apply to stocks.” As for Dongzhi's counterparties using illegal means to inflate Dongzhi's revenue and inflate or falsify Dongzhi's operating costs and profits, once discovered and verified by the company, corrections were made immediately. The company promptly corrected early accounting errors for the relevant year and disclosed them to the public on April 30, 2022. Meanwhile, the company immediately reported the case to the public security authorities. Currently, the case of the suspects Chen Chuanrong, Yi Zongxiang, Liu Ying, Wang Ling, and Liu Bing on suspicion of contract fraud and occupation of office has been handed over by the Public Security Bureau to the judicial department for prosecution. The “Advance Notice of Administrative Penalties and Market Bans” issued by the Shenzhen Supervisory Authority of the Securities Regulatory Commission affected the company's 2015-2019 annual report data. It was a treatment of the company's historical issues, and the company's current operations were not affected. Currently, the company has stable operations and sufficient capital. Attention is being paid to eliminating adverse effects on the company's performance improvement and actively consolidating the company's overall asset efficiency. In the first quarter of 2024, the company's operating income increased 10.02% over the same period last year, net profit to mother was 14.1791,000 yuan, and net cash flow from operating activities increased 21.12% over the same period last year. Subsequent companies will continue to work hard to achieve greater breakthroughs in smart services and other business sectors around the application of next-generation information technologies such as 5G, big data, cloud computing, the Internet of Things, and artificial intelligence. The company will actively take various measures to eliminate the impact of related matters as soon as possible, and strive to withdraw the risk warning as soon as possible in accordance with the requirements of the regulations. The company will also take it as a warning, further improve the internal control management system, establish and improve internal supervision mechanisms, and raise the company's management level.