{
  "docId": "019dd923-622c-750b-8b96-874267abd326",
  "docSlug": "82a540401996",
  "documentTitle": "China Huishan Dairy Holdings (6863.HK)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson C. Block",
  "documentKindSlug": "research-note",
  "documentKindLabel": "Research note",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2016-12-19 00:00:00",
  "orientation": "portrait",
  "aspectRatio": 0.77272725,
  "pageNumber": 2,
  "pageCount": 13,
  "prevPage": 1,
  "nextPage": 3,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "balanced",
  "nDataPoints": 8,
  "notes": "The slide uses a comparison table to highlight the discrepancy between SAT-derived revenue and SAIC-reported figures.",
  "elementsJson": [
    "headline_text",
    "paragraph",
    "data_table",
    "footnote"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b96-874267abd326/2",
  "deckHref": "/decks/019dd923-622c-750b-8b96-874267abd326",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b96-874267abd326.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b96-874267abd326#slide-2",
  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "VAT data from the State Administration of Taxation (“SAT”) show that Huishan reports a significant amount of fraudulent revenue.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-14d8-75c0-8c90-1520f7823e03",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "metric",
      "text": "revenue inflation: -29.43%",
      "attrs": null,
      "subkind": "primary",
      "toolName": "Quantification",
      "toolSlug": "quantification",
      "confidence": null,
      "componentId": "019dd953-14d8-75c0-8c90-1b02b4a0aa4c",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.05,
        "w": 0.7,
        "x": 0.15,
        "y": 0.13
      },
      "kind": "paragraph",
      "text": "In Part 1, we explained our conclusions that Huishan fraudulently inflates its profit margins, CapEx, and cash balance. In Part 2, we will detail our conclusion that Huishan’s reported revenue is also fraudulent.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "b283605a-a104-4fa1-8754-1df9cd769531",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.15,
        "w": 0.7,
        "x": 0.15,
        "y": 0.61
      },
      "kind": "paragraph",
      "text": "Our SAT data is for calendar year 2015, while Huishan reports on a March 31st fiscal year. In order to see the overstatements, we have to estimate Huishan’s CY15 finished product revenue.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "e39cb168-5881-47cb-abc0-9cb4ffe1691e",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.15,
        "w": 0.7,
        "x": 0.15,
        "y": 0.79
      },
      "kind": "source-note",
      "text": "The SAT data was presented without chops, but we believe it is reliable based on our investigators’ assurances...",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "cc973f7b-3f4d-4c5b-9e94-147c4a512ebe",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.12,
        "w": 0.5,
        "x": 0.25,
        "y": 0.44
      },
      "kind": "table",
      "text": "CY15 Finished Product Sales: 2,352 (SAT), 3,333 (Adjusted Reported), 3,685 (SAIC). SAT Difference: -29.43%, -36.17%",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "910f2824-05e9-48ee-acf6-12329296d340",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.7,
        "x": 0.15,
        "y": 0.08
      },
      "kind": "title",
      "text": "China Huishan Part 2: Tax Bureau Evidence of Topline Fraud",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "23335502-df37-4973-8e6b-0c914fa9baf7",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "2225e993-b9b0-4cfa-a619-99242f29484b",
      "evidence": "The slide explicitly frames the analysis as evidence of topline fraud by comparing internal reports to tax data.",
      "confidence": 0.9
    }
  ],
  "arcBeats": [
    {
      "to": 4,
      "from": 2,
      "beatId": "5e265dc5-f5cd-4e10-84b4-4ae21b7d2282",
      "arcName": "Overcoming the Monster",
      "arcSlug": "overcoming-monster",
      "beatName": "The Monster",
      "beatSlug": "overcoming-monster-the-monster",
      "evidence": "The document presents evidence of contradictions in Huishan's yield rates and production costs",
      "position": 0,
      "confidence": 0.8,
      "parentBeatName": "Hook",
      "parentBeatSlug": "hook"
    }
  ],
  "loops": [
    {
      "to": 4,
      "from": 2,
      "name": "Pattern Hunter",
      "slug": "02-pattern-hunter",
      "bestFor": "Time-pressed audiences, building consensus, when data is strong",
      "matchId": "8d9f16dc-6f47-4c84-993f-04778ecd5cce",
      "evidence": "The document presents a table comparing global milk yield rates",
      "position": 0,
      "objective": "Identify patterns of inconsistency in Huishan's financials",
      "structure": "Evidence A -> Evidence B -> Evidence C -> Pattern/Conclusion",
      "confidence": 0.7,
      "description": "Group multiple pieces of evidence that together point to a pattern or conclusion"
    }
  ],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}