FangDD Provides Clarification on Dismissal of KPMG

Rhea-AI Summary

Fangdd Network Group Ltd. (Nasdaq: DUO) announced on August 1, 2022, the transition from KPMG Huazhen LLP to Audit Alliance LLP as its independent auditor for the fiscal year ending December 31, 2022. KPMG's client-auditor relationship officially ended on July 25, 2022. KPMG's previous reports for 2020 and 2021 were unqualified, but the 2021 report raised concerns about the company's viability due to recurring losses and declining revenue. This change was officially approved by the audit committee on July 29, 2022.

Positive

• None.

Negative

• Significant concerns raised about the company's ability to continue as a going concern due to recurring losses and declining revenue.
• The audit reports from KPMG highlighted substantial doubt regarding the company's financial viability.

SHENZHEN, China, Aug. 04, 2022 (GLOBE NEWSWIRE) -- Fangdd Network Group Ltd. (Nasdaq: DUO) (“FangDD” or the “Company”) announced on August 1, 2022 the dismissal of KPMG Huazhen LLP (“KPMG”) and the engagement of Audit Alliance LLP ( “Audit Alliance”) as the Company’s independent registered public accounting firm to audit and report on the consolidated financial statements of the Company for the year ending December 31, 2022 (the “Initial Announcement”). Following the Initial Announcement, the Company would like to clarify the following:

• KPMG has advised the Company that July 25, 2022 was the date on which its client-auditor relationship with FangDD ended, based on the Company’s communications with KPMG.
• The audit reports of KPMG on the consolidated financial statements of the Company as of and for the years ended December 31, 2021 and 2020 did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles, except that KPMG’s report on the consolidated financial statements of the Company as of and for the year ended December 31, 2021, contained a separate paragraph stating that “The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2(b) to the consolidated financial statements, the Company has suffered recurring losses from operations and a significant decline in revenue during the year ended December 31, 2021, that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2(b). The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.”

As previously reported in the Initial Announcement, the audit committee of the Company’s board of directors formally approved the change of auditors on July 29, 2022.

About FangDD

Fangdd Network Group Ltd. (Nasdaq: DUO) is a leading property technology company in China, operating one of the largest online real estate marketplaces in the country. Through innovative use of mobile internet, cloud, big data, artificial intelligence, among others, FangDD has fundamentally revolutionized the way real estate transaction participants conduct their business through a suite of modular products and solutions powered by SaaS tools, products and technology. For more information, please visit http://ir.fangdd.com.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “aim,” “anticipate,” “believe,” “estimate,” “expect,” “hope,” “going forward,” “intend,” “ought to,” “plan,” “project,” “potential,” “seek,” “may,” “might,” “can,” “could,” “will,” “would,” “shall,” “should,” “is likely to” and the negative form of these words and other similar expressions. Among other things, statements that are not historical facts, including statements about the Company’s beliefs and expectations are or contain forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement. All information provided in this press release is as of the date of this press release and is based on assumptions that the Company believes to be reasonable as of this date, and the Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Investor Relations Contact

Ms. Linda Li
Director, Capital Markets Department
Phone: +86-0755-2699-8968
E-mail: ir@fangdd.com 

FAQ

What audit firm replaced KPMG for Fangdd Network Group Ltd. (DUO)?

Audit Alliance LLP replaced KPMG Huazhen LLP as the independent auditor for Fangdd Network Group Ltd. on August 1, 2022.

When did KPMG's client-auditor relationship with Fangdd end?

KPMG's client-auditor relationship with Fangdd Network Group Ltd. ended on July 25, 2022.

What concerns did KPMG raise in its audit reports for Fangdd Network Group (DUO)?

KPMG raised concerns about Fangdd's ability to continue as a going concern due to recurring losses and significant revenue decline in 2021.

When was the change of auditors approved by Fangdd's board?

The change of auditors was formally approved by Fangdd's audit committee on July 29, 2022.

What fiscal year will Audit Alliance LLP audit for Fangdd Network Group?

Audit Alliance LLP will audit Fangdd Network Group Ltd. for the fiscal year ending December 31, 2022.