{
  "docId": "019dd923-622c-750b-8b96-b7a743eff32e",
  "docSlug": "50bcb497e381",
  "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": "2018-07-25 00:00:00",
  "orientation": "portrait",
  "aspectRatio": 0.77272725,
  "pageNumber": 5,
  "pageCount": 11,
  "prevPage": 4,
  "nextPage": 6,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "dense",
  "nDataPoints": 14,
  "notes": "The slide presents two distinct 'tests' (Method 1 and Method 2) to expose inconsistencies in reported financial metrics.",
  "elementsJson": [
    "paragraph",
    "data_table"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b96-b7a743eff32e/5",
  "deckHref": "/decks/019dd923-622c-750b-8b96-b7a743eff32e",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b96-b7a743eff32e.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b96-b7a743eff32e#slide-5",
  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "An offline revenue decline of 4.5% is quite different from even the “healthy” or “stable” Peiyou core business which management described, let alone the 52.4% CFO Rong Luo implied.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-0397-72dc-a885-592c5cb1b5b3",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "metric",
      "text": "Peiyou offline revenue growth: (4.5%)",
      "attrs": null,
      "subkind": "primary",
      "toolName": "Quantification",
      "toolSlug": "quantification",
      "confidence": null,
      "componentId": "019dd953-0397-72dc-a885-5fe664387584",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.05,
        "w": 0.75,
        "x": 0.12,
        "y": 0.55
      },
      "kind": "paragraph",
      "text": "We next asked: Could TAL’s Peiyou offline revenue growth have hit 52.4% in Q3? If not, then Rong Luo’s answer in which he cited the purported small class growth rate is greatly misleading.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "5e08f2ad-819b-4893-b57f-94785f4dca0b",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.05,
        "w": 0.75,
        "x": 0.12,
        "y": 0.49
      },
      "kind": "paragraph",
      "text": "Method 2: Assuming FY2016 to FY2018 revenue figures and enrollment growth rates for TAL’s three business units are accurate, as is the implied 52.4% FY2018 Q3 Peiyou offline revenue growth",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "63851c01-75bd-4bfe-97b8-8cf8b7dbbe75",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.15,
        "w": 0.5,
        "x": 0.12,
        "y": 0.65
      },
      "kind": "paragraph",
      "text": "Held True as Basis For Calculation: FY2018 Q3... Revenue figures and enrollment growth rates as per TAL...",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "a1ff8af3-e964-4322-b1e9-8721ca8f541c",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.15,
        "w": 0.5,
        "x": 0.12,
        "y": 0.09
      },
      "kind": "paragraph",
      "text": "Held True as Basis For Calculation: FY2018 Q3... Revenue figures and enrollment growth rates as per TAL...",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "c1ad3a13-ae7f-43a0-b18a-40bde53cfd9e",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.05,
        "w": 0.75,
        "x": 0.12,
        "y": 0.43
      },
      "kind": "paragraph",
      "text": "An offline revenue decline of 4.5% is quite different from even the “healthy” or “stable” Peiyou core business which management described, let alone the 52.4% CFO Rong Luo implied.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "ff6e6863-85c0-4ed8-b6d8-81486c143dad",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.15,
        "w": 0.75,
        "x": 0.12,
        "y": 0.22
      },
      "kind": "table",
      "text": "Check revenue growth... Check small classes... Check Peiyou... Peiyou offline revenue growth per model (4.5%) (3.4%)...",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "30dcc139-89f8-4ad0-a726-17c8af4e827c",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.08,
        "w": 0.75,
        "x": 0.12,
        "y": 0.82
      },
      "kind": "table",
      "text": "Check ASP growth... Small classes ASP growth (5.0%) (10.5%) 28.7% 36.8%...",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "c5ef0d8e-8582-4a82-a521-b7ca7aa50cc8",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "bca20604-d9c2-4e1a-b070-f2b6ede2dd66",
      "evidence": "The slide uses forensic accounting logic to test and invalidate management's claims.",
      "confidence": 0.9
    }
  ],
  "arcBeats": [
    {
      "to": 10,
      "from": 3,
      "beatId": "a41e9d0d-ee29-48db-a151-bab1e11a5cc9",
      "arcName": "Overcoming the Monster",
      "arcSlug": "overcoming-monster",
      "beatName": "Appendix Methodology",
      "beatSlug": null,
      "evidence": "The document provides detailed methodology for analyzing the financial statements",
      "position": 1,
      "confidence": 0.8,
      "parentBeatName": null,
      "parentBeatSlug": null
    },
    {
      "to": 5,
      "from": 5,
      "beatId": "844e7d03-7ced-4b33-b391-10196c5f2b84",
      "arcName": "Overcoming the Monster",
      "arcSlug": "overcoming-monster",
      "beatName": "Expose Contradiction",
      "beatSlug": null,
      "evidence": "Further contradictions are exposed in the financial statements",
      "position": 2,
      "confidence": 0.8,
      "parentBeatName": null,
      "parentBeatSlug": null
    }
  ],
  "loops": [],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}