UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): April 9, 2010
China
New Energy Group Company
(Exact
name of Registrant as specified in its charter)
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Delaware
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001-32691
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65-0972647
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(State
or other jurisdiction
of
Incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification
No.)
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20/F, Center Plaza, No.188 Jie Fang
Road
He
Ping District, Tianjin, 300042
People's
Republic of China
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's
telephone number, including area code: (011)-86-22-5829 9778
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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Written
communications pursuant to Rule 425 under the Securities
Act(17CFR230.425)
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Soliciting
material pursuant to Rule14a-12 under the Exchange
Act(17CFR240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17CFR240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17CFR240.13e-4(c))
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Item 4.02. Non-reliance on
Previously Issued Financial Statements or a Related Audit Report or Completed
Interim Review
On April
9, 2010, the Company’s Chief Executive Officer and Chief Financial Officer
concluded that the previously issued audited financial statements
for the fiscal years ended December 31, 2010 included in the
Company’s Annual Report on Form 10-K (the “2008 10-K”) filed on April, 15, 2009
and the unaudited financial statements for the three months ended March 31,
2009, June 30, 2009 and September 30, 2009 included in its Quarterly Reports on
Form 10-Q filed on May 15, 2009, August 14, 2009 and November 16, 2009
(collectively, the “2009 10-Qs”) should no longer be relied upon and that
disclosure should be made and action should be taken to prevent future
reliance.
Contemporaneously
with the filing of this Current Report on Form 8-K the Company is filing an
amendment to the 2008 10-K, which filing will contain restated financial
statements for the fiscal year ended December 31, 2008. The
Company intends to file amendments to the 2009 10-Qs as soon as is
practicable.
The
principal changes in the amendment to the 2008 10-K are as
follows:
1. There
were errors in the recording of the fair value of the assets acquired during the
acquisition of Qinhuangdao Chensheng Gas Co. Ltd.
(“Chensheng”).
Therefore,
the Group has recorded the increase to the fair value from the book value of
several assets, including $1,036,655 of Property, plant and equipment, $3,012 of
Inventories, and $63,014 of Goodwill and the decrease in $505,941 in Land use
right. Consequently, we recalculated the $96,489 of the depreciation for such
increment of those assets and minority interest in Chensheng, which caused a
decrease to the minority interest by $77,647 in the consolidated balance
sheet and a decrease to the minority interest’s share of net income by $414,763
in the consolidated statement of operations and comprehensive
income.
2. There
was an error in the elimination of its intercompany accounts. Therefore, we have
recorded a decrease in the related party receivable balances by $84,120 and an
increase in the general and administrative expenses by $54,196 and the
comprehensive income of $29,924.
3. We
have reassessed the nature of the preferred stock together with warrants and we
reclassified $1,857 and $7,029,961 (total amounting to $7,031,818) from
preferred stock and additional paid in capital. Also, we reclassified
warrant liabilities of $2,952,273 from additional paid in capital and recognized
a $2,553,870 loss from the change in fair value of the warrant liabilities in
the income statement and the total amount of the warrant liabilities was
$5,506,143 as of December 31, 2008. In addition, we have accrued
$900,000 registration right liabilities as of December 31, 2008.
4. There
was an error in recording the pre-acquisition cash flow activities of the newly
acquired subsidiary, Chensheng and the cash flow activities of disposed
subsidiary, Hunchun. We have excluded the cash flow activities of
Chensheng and included the cash flow activities of Hunchun under discontinued
operations in each section of the cashflow activities. As a result, we
made those adjusting entries in the cash flow statement for the year ended
December 31, 2008.
5. We
have some reclassifications in both Consolidated Balance Sheets and Consolidated
Statements of Operations and Comprehensive Income.
Beginning
in November 2009 the company began reviewing its previously filed reports and
discovered the errors set forth above Those errors
were discussed with board following which the company determined that
a restatement was necessary and appropriate..
The
Company discussed the foregoing matters with the Company’s independent
registered public accounting firm. The chief executive officer has
authorized that the chief financial officer take the appropriate and necessary
actions to restate the 2008 10-K and the 2009 10-Qs.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this current report to be signed on its behalf by the undersigned
hereunto duly authorized.
Date:
April 15, 2010
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CHINA
NEW ENERGY GROUP COMPANY
(Registrant)
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By:
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/s/ Yangkan
Chong
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Yangkan
Chong
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Chief
Executive Officer
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