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Can you use two sets of books when going public in Canada?

Can you use two sets of books when going public in Canada?

Can you use two sets of books when going public in Canada? 150 150 Jiang Hong Wilkin Business Law

If a Chinese company would like to go public, they must give up on using two books of financial statements. For tax purpose, some Chinese companies intentionally decrease the profit in financial statements. When they are going to public, they say the actual profit is much higher than the profit in the financial statements. This does not work. If the company would like to use the numbers for higher profit, they have to report to the Tax Bureau and pay the extra tax. If they do not want to pay the extra tax, only the numbers in the financial statements which was reported to the Tax Bureau can be used for going public purposes. The securities commissions and stock exchanges in Canada have become much smarter. They require not only the financial statements prepared for the going public transaction, but also the financial statements submitted to Chinese Industry and Commercial Bureau and Tax Bureau. If the financial statements are not the same, then the Company is providing false information and the going public transaction will not be successful.

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