Core Viewpoint - Shanghai Huaming Intelligent Terminal Equipment Co., Ltd. is facing administrative penalties from the China Securities Regulatory Commission (CSRC) for violations related to information disclosure, specifically concerning improper accounting treatment of expenses and potential profit inflation [1][2][3] Group 1: Administrative Penalties - The CSRC has issued a notice indicating that the company and its executives are suspected of violating securities laws, leading to a formal investigation and potential penalties [1][2] - The company is proposed to receive a warning and a fine of 1.5 million yuan for its violations [4][6] - Individual executives, including Zhang Liang, Zhang Yejun, Fan Lina, and Han Zhi, are also facing fines ranging from 500,000 to 700,000 yuan [6] Group 2: Violations and Financial Impact - The company’s subsidiary, Juyi Technology, improperly classified certain expenses as research and development costs instead of sales expenses, leading to inflated profit figures [2][3] - The misclassification resulted in an inflated profit total of 35.7037 million yuan, which accounted for 16.90% of the reported profit for the period [2] - The company has acknowledged the discrepancies and has taken steps to correct the financial statements, including a retrospective adjustment of the financial reports [5]