An excellent article (read here) on Neil Shen of Sequoia Capital, and his involvement in various accounting schemes and related party transactions to dupe public investors.
I can't emphasize this enough, but many private enterprises in China are established for the sole purpose of being taken public. Many (if not most) VC/PE firms in China are in bed with these private enterprises to add 'credibility' to the IPO. They want the same thing: (1) exit through an IPO via aggressive accounting (sponsored by complacent accountants and underwriters), and (2) funds raised are eventually siphoned off through acquisitions and related party transactions.
Public investors are duped by the shiny 'brand name sponsors' and are left holding the bag...
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