Smartphone maker Xiaomi fell foul of Chinese authorities due to irregularities with its accounting practices, Financial Times reported.
Xiaomi, which listed earlier this year, was found to have incorrectly classified corporate gifts, and failed to standardise reimbursements and the payments of other corporate expenses. The company was said to have already rectified the issues, but obviously the news was not welcomed by investors.
The report stated Chinese authorities are in the midst of a crackdown on tax evasion, which has been extended to technology companies with overseas assets. It is targeting companies which have complex accounting practices that “fall into a legal grey zone”.
Other companies have also been caught up in the probe, including Suning, an Alibaba-backed e-commerce giant.Subscribe to our daily newsletter Back