HKEX penalizes CHK Oil for inaccurate financial reports

The Hong Kong Stock Exchange has censured CHK Oil (0632) for breaching the Listing Rules by publishing financial results and reports that were materially inaccurate, incomplete, and/or misleading.

Yu Jiyuan, the former executive director, chief executive officer, and chairman, was reprimanded and imposed a prejudice on investors' interests statement by the HKEX for failing to report issues related to the company's material assets, including the loss of such assets, to the company's board of directors, audit committee, and auditors for over two years.

The HKEX identified that the company failed to exclude terminated leases from its balance sheets, resulting in an overstatement of total assets by approximately 65.5 percent and 58.1 percent for the years ending December 31, 2022, and 2023, respectively.

Both the company and Yu agreed to settle the disciplinary action, did not contest their respective breaches, and accepted the sanctions imposed by the List Committee.

Gloria Leung