Luckin Coffee Inc. stock shot up almost 7% after the company announced new investment of $250 million. However, at the same time, they announced the appointment of a new auditor after the previous auditor handed in their resignation citing the unusual condition of being unable to complete the audit.
Some analysts said this statement from the auditor raised eyebrows, as it is a reason that has never been given before by an auditor. The announcement said that the coffee company
have no disagreements on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure – statement from the company
The company which was previously listed on the US stock exchange and was seen as the main contender to Starbucks in China, had been found guilty of a huge fraud which resulted in the business being delisted from the exchange and sued by unhappy investors.
Luckin Coffee plans to use the proceeds of the investment to facilitate the company’s proposed offshore restructuring and fulfill its obligations under its recently announced settlement with the U.S. Securities and Exchange Commission. – statement from the company
