Diyuan Technology's then-Chairman Gu Jian fined one million: refused to accept audit reports and failed to disclose annual reports on time

Rui Finance Wang Min On March 6, the Jiangsu Securities Regulatory Bureau imposed administrative penalties on Jiangsu Yateer Ground Source Technology Co., Ltd. (hereinafter referred to as “Ground Source Technology”) and related responsible persons for failing to disclose the 2024 annual report on time.

It was found that the following illegal facts existed:

In April 2025, Ground Source Technology hired Beijing Zhongming Guocheng Certified Public Accountants LLP (hereinafter referred to as Zhongming Guocheng) as the audit institution for 2024. Due to disagreements over the type of audit opinion, the company refused to accept the audit report proposed by Zhongming Guocheng.

On April 30, 2025, Ground Source Technology issued an announcement that it could not disclose the 2024 annual report within the statutory deadline, and its stock was suspended from trading starting May 6.

In May 2025, Ground Source Technology hired Sichuan Huaxin (Group) Certified Public Accountants LLP (hereinafter referred to as Huaxin) as the audit institution for 2024. On June 20, the company announced that Huaxin could not complete the audit on time due to estimation errors in workload and sent a letter to terminate the audit engagement.

On June 30, 2025, Ground Source Technology issued an announcement that, due to failure to disclose the 2024 annual report by June 30 (inclusive), the company faced the risk of delisting from the National Equities Exchange and Quotations (NEEQ) system.

On December 19, 2025, Ground Source Technology announced that its stock would be delisted from the NEEQ system on December 22. As of the delisting date, the company still had not disclosed the 2024 annual report.

The above illegal facts are supported by relevant company announcements, inquiry records, explanations provided by the parties, and other evidence, which are sufficient for confirmation.

The Jiangsu Securities Regulatory Bureau believes that Ground Source Technology’s failure to disclose the 2024 annual report within four months after the end of the 2024 fiscal year, in accordance with legal requirements, violates the relevant provisions of Articles 78(1) and 79(1) of the Securities Law, constituting the illegal act described in Article 197(1) of the Securities Law.

According to Article 82(3) of the Securities Law, the “Administrative Measures for Information Disclosure of Non-Listed Public Companies” (CSRC Order No. 227), Articles 28 and 30, the chairman, manager, and information disclosure responsible person of the company shall bear primary responsibility for the authenticity, accuracy, completeness, timeliness, and fairness of the company’s information disclosure. Xu Weidong, as a director and responsible person for information disclosure, was responsible for the disclosure of periodic and interim reports. His refusal to accept the audit report issued by Zhongming Guocheng, and his failure to promptly prepare the draft of the 2024 annual report for review by the board, constitute a breach of duty. Gu Jian, then chairman and general manager, after learning of the company’s illegal failure to disclose the 2024 annual report on time, did not raise objections and neglected to perform his duties. These two individuals are the direct responsible persons for the company’s failure to disclose the periodic reports on time.

Based on the facts, nature, circumstances, and social harm of the illegal acts committed by the parties, and in accordance with Article 197(1) of the Securities Law and Article 5 of the “Decision of the State Council on Issues Concerning the National Equities Exchange and Quotations System” (Guofa [2013] No. 49), the Jiangsu Securities Regulatory Bureau has decided:

1. To issue a warning to Jiangsu Yateer Ground Source Technology Co., Ltd. and impose a fine of 800,000 yuan;

2. To issue a warning to Xu Weidong and impose a fine of 400,000 yuan;

3. To issue a warning to Gu Jian and impose a fine of 300,000 yuan.

Ground Source Technology was established in November 2010 and was listed on the New Third Board. The company’s main businesses include the design, construction, and equipment maintenance of ground source heat pump systems, heating engineering systems, and fresh air systems, as well as wholesale operations of underfloor heating equipment.