According to its website, Beijing-based China Animal Healthcare "is a leading animal drug manufacturer focusing on the manufacture, sale and distribution of compound chemical drugs (comprising powdered drugs and injection drugs) and biological drugs (comprising Mandatory Vaccines and non-Mandatory Vaccines) for poultry and livestock in the PRC."

It adds that "as a value-added service, we provide technical and support services such as farming techniques and methodologies and impart knowledge relating to animal health and treatment of animal diseases to both select retailers who meet their sales target and retailers with sales potential."

It almost certainly does none of that; instead the company is merely the latest run off the mill Chinese corporate fraud, although this one is truly hilarious.

More to the point, the publicly traded, or rather not publicly traded company, has had its shares – which quadrupled from mid 2013 to late 2014 – suspended since March 30, pending the release of its still-undisclosed financial results for 2014.

To those hoping for a lift to the stock trading suspension, or a presentation of the financial results, we have bad news: both will never happen.

As the WSJ reports, in September accounting firm Deloitte Touche Tohmatsu resigned as its auditor, saying the firm alleged misconduct by a China Animal Healthcare employee and that the two firms disagreed on bank balances.

Then in October, the company announced that local authorities in Hebei province revoked some of its production permits and manufacturing certificates over local safety and environmental concerns. They also asked that the company relocate some facilities away from residential areas.

In short: the company's business and fraudulent operations were in freefall, the management team is likely facing arrest or worse, and as such the opportunity cost to come up with absolutely ridiculous stories to justify what will emerge as corporate fraud, is low.

So low in fact, that the result was nothing short of today's, if not this year's, most entertaining story of corporate fraud and may enter the history books as the most ridiculous official explanation for why it was cooking its financials.

The "explanation", as it turns out, would make even the IRS' Lois Lerner blush.

Fast forward to Monday when, as @WallStCynic points out, China Animal Healthcare said in a statement to the Hong Kong stock exchange that a truck loaded with four years’ worth of its original financial documents was on its way to Beijing. However, while the truck driver was taking a lunch break, the truck was stolen. One week later the truck was found… but the four years of financial documents were gone.

A driver sits in his truck in Hebei province, China. Bloomberg News

“The possibility of finding the Lost Documents is not high,” the company said in the filing, conveniently adding that local police told them such thefts were common in Qingyuan.

And that's how the only set of the company's "original financial documents" disappeared forever.

* * *

That was the summary. The details, as laid out in the full filing, have to be read ideally in as deadpan a voice as possible, to be believed. The full excerpt from the linked filing follows:

 

 

The board (the “Board”) of directors (the “Directors”) of the Company wishes to inform the shareholders of the Company (the “Shareholders”) that on 4 December 2015, a truck of the Group (the “Truck”) loaded with, among other things, all original financial documents of the Group for the four financial years ended 31 December 2014 and for the current year (the “Lost Documents”) were stolen in the Qingyuan District of Baoding City, Hubei Province, China while the truck driver was taking a lunch break on his journey to transport the Lost Documents back to the Group's head office in Beijing (the “Incident”).

The Lost Documents were originally stored in the Group's office in Shijiazhuang, being the document storage centre of the Group. On 3 December, the Group made arrangements to transport the Lost Documents back to the Group's head office in Beijing for collation in order to facilitate, among other things, the Forensic Investigation. At around noon of the same day, the Truck broke down and was towed to a car repair garage in Qingyuan District for repair. On 4 December at around 11:30 a.m., the driver of the Truck picked up the Truck from the garage after repair and went for lunch at a nearby restaurant. The Truck driver discovered after lunch that the Truck was stolen.

Immediately after the Incident took place, the Group made a report to the local public security bureau and sent staff to search for the Truck in the direction the Truck had gone according to the road monitoring system of the local public security bureau. Given the gravity of the Incident, the Group convened a meeting on 5 December 2015 with the driver of the Truck and other relevant personnel of the Group to inquire further into the Incident, as well as set up a special investigation group (the “SIG”) accountable to the Board which is headed by Mr. Li Jun, an executive Director, to (i) investigate into the Incident, (ii) maintain close contact with the local public security bureau to search for the Truck, and (iii) confirm the list of Lost Documents and follow up on this matter.

Based on the findings of the investigation by the SIG, no suspicious person has been identified in the Incident. According to the local public security bureau, thefts such as the Incident are common occurrence in the Qingyuan District.

On 12 December 2015, the Company was notified by the local public security bureau that the Truck was found but not the Lost Documents. As at the date of this announcement, although the possibility of finding the Lost Documents is not high, the Group has nonetheless deployed all possible resources in search of the Lost Documents. Since the occurrence of the Incident, the finance team of the Group has been actively inquiring from different sources to retrieve as many copies of the Lost Documents as possible in order to minimise the impact of the Lost Documents. At the same time, the management of the Company has communicated to the Forensic Accountant on the Lost Documents, so as to minimize the impact on their work. Further investigation by the SIG of the Incident is currently in progress. The Company will publish further announcement(s) to update the Shareholders when there is further development on the Incident.

We eagerly await comparable the-truck-with-all-the-financial-documents-was-stolen excuses (the "excuse") to emerge in the US, once the stock market tide finally goes out.

http://www.zerohedge.com/news/2015-12-29/may-be-greatest-explanation-ever-cooking-companys-books