2016.09 C ZENITH CHEM

Company Name: China Zenith Chemical Group Limited
Stock Code: 00362
Year end: June 30, 2016

Basis for Qualified Opinion

Opening balances, corresponding figures and comparative financial statements

The corresponding figures and comparative financial statements in the current year’s financial statements were derived from the financial statements for the year ended 30 June 2015 which contained a disclaimer of audit opinion, details of the qualifications were set out in the auditor’s report dated 30 September 2015. We have not been able to obtain sufficient appropriate audit evidence as to whether (i) the opening balances, (ii) the corresponding figures and comparative financial statements were properly recorded and accounted for.

Any adjustments that might have been found to be necessary would have had a consequential impact on the net assets of the Group as at 30 June 2016, results of the Group for the year ended 30 June 2016 and the related disclosures thereof in the financial statements.

Qualified Opinion

In our opinion, except for the effects of the possible effects on the opening balances, corresponding figures and comparative financial statements, the consolidated financial statements give a true and fair view of the financial position of the Group as at 30 June 2016 and of the Group’s financial performance and cash flows for the year then ended in accordance with Hong Kong Financial Reporting Standards and have been properly prepared in compliance with the disclosure requirements of the Hong Kong Companies Ordinance.

Emphasis of Matter

We draw attention to note 2 to the consolidated financial statements which indicates that the Group has net current liabilities of approximately HK$839,335,000 as at 30 June 2016. These conditions, along with other matters as set out in note 2 to the consolidated financial statements, indicate the existence of a material uncertainty that may cast significant doubt about the Group’s ability to continue as a going concern.