Core Viewpoint - The conflict between Lufax Holding (陆控) and PwC centers around the independent investigation results of related party transactions, revealing that while such transactions existed, their purpose differed from PwC's claims. Lufax failed to comply with necessary procedures and accounting standards, leading to significant management changes and a shift in auditing firms [1][2][3]. Related Party Transactions Investigation - An independent investigation commissioned by Lufax confirmed the existence of related party transactions, but the purpose was to compensate retail investors for losses rather than to cover previous losses of related entities. Lufax did not follow the required procedures for these transactions [2][3]. - The investigation revealed that from May 2023 to January 2024, Lufax invested in trust products managed by a non-related trust company, which were directed to purchase assets from related entities [2]. Financial Impact - Lufax acknowledged that the related party transactions constituted a breach of listing rules, affecting the fair value of assets and potentially leading to a 0.5% increase in total assets by the end of 2022, but a decrease of up to 2% by the end of 2023. Net profit is expected to decline by 8% to 15%, equating to a loss of 83 million to 155 million yuan [3][9]. Management Changes - Following the investigation, Lufax's board proposed significant management changes, including the appointment of a new chairman and CFO, to enhance corporate governance and comply with listing rules [5][6]. - The new chairman, Ye Dichi, and CFO, Xi Tongzhuo, both have extensive experience in the financial sector, with previous roles in Ping An Group [6]. Auditing Firm Transition - Lufax's board recommended appointing Ernst & Young as the new auditor to replace PwC, pending approval at a special shareholders' meeting [4]. Internal Control Enhancements - Lufax plans to hire independent consultants to improve its internal control systems and has established temporary committees to oversee these enhancements [7]. Loan Performance - Lufax reported a 31.2% year-on-year decrease in total outstanding loans, amounting to 216.9 billion yuan by the end of 2024. However, new loan issuance showed improvement, particularly in consumer finance, with a 50% increase in new loans [8]. - The overdue loan rates have also improved, with the 30-day overdue rate decreasing from 5.2% to 4.5% over three reporting periods [8]. Financial Performance Overview - Lufax's financial performance has been declining, with total revenue and net profit significantly dropping, including a net loss exceeding 700 million yuan in a single quarter [9].
与普华永道“分手”后续：陆控关联交易调查结果披露，董事长及CFO双双更换