AXM: SEC investigating the firm for possible misleading financial statements

By Ted A. Knutson

Washington, Jan. 5 - AXM Pharma, Inc. announced Thursday it received notification from the Securities and Exchange Commission Dec. 29 that the SEC is investigating if the firm and current and former employees violated federal securities laws by issuing false and misleading statements about the company's revenues, expenses, earnings and losses from April through October.

In addition, the SEC staff is investigating, among other things, whether or not, for the relevant time period, AXM failed to keep required books and records, failed to devise and maintain sufficient internal accounting controls, falsified books and records and made false and misleading statements to its independent accountants.

The company said it has received a subpoena to produce documents in connection with the investigation.

Based upon the subpoena, AXM said it believes that the investigation relates in significant part to the matters which caused the company to restate its financial statements for the period ended June 30.

On Oct. 31, AXM announced it was restating its second-quarter results due to new management's determination the company had improperly recognized about $2.8 million of revenues related to the distribution of Sunkist-branded products in Hong Kong, China and Taiwan.

The company said it intends to fully cooperate with the SEC investigation.

Based in Las Vegas, AXM manufactures and distributes pharmaceuticals throughout China.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.