{
  "docId": "019dd923-622c-750b-8b96-aa4b5c012f2a",
  "docSlug": "aa7e6c3950ac",
  "documentTitle": "TAL Education Group (TAL)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson C. Block",
  "documentKindSlug": "research-note",
  "documentKindLabel": "Research note",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2018-06-13 00:00:00",
  "orientation": "portrait",
  "aspectRatio": 0.77272725,
  "pageNumber": 39,
  "pageCount": 71,
  "prevPage": 38,
  "nextPage": 40,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "dense",
  "nDataPoints": 16,
  "notes": "The slide uses a comparison of two tables to show the reduction of learning centers in Guangzhou, supporting the argument of a 'short leash' control strategy.",
  "elementsJson": [
    "paragraph",
    "comparison_table",
    "footnote"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b96-aa4b5c012f2a/39",
  "deckHref": "/decks/019dd923-622c-750b-8b96-aa4b5c012f2a",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b96-aa4b5c012f2a.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b96-aa4b5c012f2a#slide-39",
  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "When fraud is committed through proxy interest holders in China, we have found it is common for the physical locations of the proxy to be in or near those of the controlling parent.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-25b2-736e-8e67-9d92d1ef36fb",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.2,
        "w": 0.8,
        "x": 0.1,
        "y": 0.08
      },
      "kind": "paragraph",
      "text": "The slide argues that TAL's disposal of learning centers to Changing Edu was a sham, evidenced by the lack of related party transaction disclosures and the physical proximity of the new entity to TAL's existing facilities.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "1278abba-128f-42fe-bd2e-7d442bfcedff",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.15,
        "w": 0.8,
        "x": 0.1,
        "y": 0.56
      },
      "kind": "paragraph",
      "text": "Details regarding Shujia's SAIC filings, lease information for the Quzhuang center, and the strategic proximity of the new registered address to TAL's Peiyou service centers.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "d7f15167-93b6-4a04-b6ae-dcf528cf1be1",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.08,
        "w": 0.8,
        "x": 0.1,
        "y": 0.72
      },
      "kind": "paragraph",
      "text": "Analysis of the pattern of proxy interest holders and the 'short leash' control strategy.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "f9bd4960-753f-4157-9107-86d241b24c38",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "quote",
      "text": "We exchanged 10 one-on-one learning centers in Guangzhou to Changing location, following the agreement signed in June 2015. — CFO Rong Luo",
      "attrs": null,
      "subkind": null,
      "toolName": "Authority citation",
      "toolSlug": "authority-citation",
      "confidence": null,
      "componentId": "019dd953-25b2-736e-8e67-a079bf132433",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.12,
        "w": 0.8,
        "x": 0.1,
        "y": 0.82
      },
      "kind": "source-note",
      "text": "Footnotes 93-96 detailing sources for earnings calls, SAIC files, and website references.",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "d6c68981-36e2-4bda-bb2a-2b2fcfe18ece",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.12,
        "w": 0.72,
        "x": 0.14,
        "y": 0.29
      },
      "kind": "table",
      "text": "FY2016 Q2 Investor Presentation table showing 10 One-on-One centers in Guangzhou.",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "3d5f7f0e-0665-4d68-99b0-a1d4f8558a36",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.12,
        "w": 0.72,
        "x": 0.14,
        "y": 0.43
      },
      "kind": "table",
      "text": "FY2016 Q3 Investor Presentation table showing 0 One-on-One centers in Guangzhou.",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "b0eb5507-d8a7-43f1-967c-a81546d7b7b6",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "1d8fbc68-e22d-4286-a9c6-7a0d65945f58",
      "evidence": "The slide explicitly discusses 'fraud is committed through proxy interest holders' and provides evidence to support this claim.",
      "confidence": 0.95
    }
  ],
  "arcBeats": [
    {
      "to": 71,
      "from": 3,
      "beatId": "9de0976e-28e1-420f-a107-b337349d49c9",
      "arcName": "Problem-Agitate-Solution",
      "arcSlug": "problem-agitate-solution",
      "beatName": "Expose Contradiction",
      "beatSlug": null,
      "evidence": "The document is primarily composed of slides that expose contradictions in TAL Education's financial reports",
      "position": 0,
      "confidence": 0.8,
      "parentBeatName": null,
      "parentBeatSlug": null
    },
    {
      "to": 71,
      "from": 24,
      "beatId": "f1a1059e-e779-4948-a18b-bd7e979146da",
      "arcName": "Problem-Agitate-Solution",
      "arcSlug": "problem-agitate-solution",
      "beatName": "Appendix Data",
      "beatSlug": null,
      "evidence": "The document includes extensive data and financial reports to support its claims",
      "position": 2,
      "confidence": 0.8,
      "parentBeatName": null,
      "parentBeatSlug": null
    }
  ],
  "loops": [
    {
      "to": 71,
      "from": 2,
      "name": "Cost Of Inaction",
      "slug": "27-cost-of-inaction",
      "bestFor": "Urgent budget requests, compliance, risk mitigation",
      "matchId": "173d833e-f506-46f1-a81b-f0c40e490cd2",
      "evidence": "The document implies that investors who fail to address these discrepancies may suffer significant financial losses",
      "position": 2,
      "objective": "What is the cost of not addressing TAL Education's financial discrepancies?",
      "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point",
      "confidence": 0.6,
      "description": "Quantify what happens if the audience does nothing"
    }
  ],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}