On August 17, 2011, the SEC served the Company with a subpoena for documents in connection with its investigation. The Company is committed to cooperating with the SEC. The Company cannot predict the timing or outcome of the investigation.
A-Power Energy Generation Systems today announced that its independent auditor, MSCM LLP, has resigned. In its letter to the Company dated June 26, 2011, MSCM stated that it had resigned because the Company had not retained a qualified independent forensic accounting firm to evaluate certain business transactions that MSCM stated was necessary for MSCM to complete its audit of the Company's financial statements for the year ended December 31, 2010 on a timely basis.
In light of MSCM's withdrawal, A-Power and members of the Audit Committee of the Board of Directors will be meeting with other qualified independent auditing firms. The Company will announce its new independent auditor after the Audit Committee has selected a firm and an audit engagement contract has been entered into between the Company and that firm. As a result of MSCM's resignation, the Company's annual report on Form 20-F for the year 2010 will be delayed beyond June 30, 2011, the date the filing is due at the Securities and Exchange Commission. A-Power greatly regrets this delay and will work as rapidly as possible with a new independent auditor to complete the audit of its financial statements for the year 2010 and to then file its annual report on Form 20-F.