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  "documentTitle": "Sino-Forest Corporation (TRE)",
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  "authorName": "Carson C. Block",
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  "presentationDate": "2011-06-02 00:00:00",
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  "notes": "The slide uses a forensic accounting approach to expose a 'capital hole' in the company's reported financials.",
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      "text": "Therefore, TRE has a capital hole of $377 million to $922 million. It could not have purchased the trees it claims to have.",
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      "text": "Onshore Cash Hole: $922 million",
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      "kind": "paragraph",
      "text": "The authorities will review the entire establishment application, including the portion requesting the right to bring foreign currency into China.",
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      "text": "TRE's agents under the master purchase agreements are thinly capitalized... They could not have each funded hundreds of millions of dollars in undocumented currency swaps done through offshore bank accounts.",
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      "text": "TRE could not have funded its business with foreign currency... Therefore TRE could not have made these investments by paying the sellers in foreign currency in the PRC.",
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      "text": "A given company's SAIC file shows records current within a few months of all applications for injecting equity capital... Therefore, TRE has a capital hole of $377 million to $922 million.",
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      "text": "Cash flow numbers from Bloomberg. To be conservative, we assumed that all short-term borrowings were onshore.",
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      "kind": "source-note",
      "text": "For more on how China's currency controls work, see Collins, Robert and Block, Carson “Doing Business in China for Dummies” (Wiley 2007), chapter 9.",
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      "text": "(USD millions) OCF 3,308 CapEx - Disposals 5,058 Total ST Borrowings incl. Repayments 160 Onshore Capital Need 1,590 Capital Contributed - High 1,213 Capital Contributed - Low 668 Onshore Cash Hole - Low 377 Onshore Cash Hole - High 922",
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