China High Speed Transmission Equipment Group (HKG:0658) said an internal control review by an external consultant identified weaknesses in connected-person identification, reporting procedures, and third-party borrowing policies, according to a Wednesday Hong Kong bourse filing.
Shares of the transmission equipment manufacturer fell nearly 3% in Thursday late morning trade.
Key findings included the lack of systematic distribution of the group's connected-person list to subsidiaries, which could delay the identification of connected transactions.
The review also found that formalised procedures were not in place to ensure connected persons identified during customer or supplier onboarding are promptly reported for compliance and disclosure purposes.
The exercise followed earlier disclosures related to the Handa loan and its assignment, according to the filing.
The board said it agrees with the findings and has engaged external advisers to implement the recommended enhancements.
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