SEC Probing Alibaba on Cainiao-Related Accounting

The video discusses Alibaba's challenges with the SEC due to limited access to its accounting records in China. It highlights concerns about Alibaba's reported sales figures, particularly during Singles Day, and questions about its financial consolidation practices. The video also explores the complexities of Alibaba's corporate structure, including variable interest entities, and the risks associated with investing in Chinese companies. The SEC's role and limitations in investigating these companies are also examined.

What is one of the main reasons the SEC has limited ability to investigate Alibaba?

• Alibaba's headquarters are in the US.

• The accounting records are kept in China.

• The SEC has no interest in Alibaba.

• Alibaba is a private company.

Why does the SEC want to know about Alibaba's shipping business?

• To understand why it is not consolidated in their financials.

• To ensure they are delivering packages on time.

• To verify the number of employees in the shipping department.

• To check if they are using eco-friendly packaging.

How does Amazon differ from Alibaba in terms of financial transparency?

• Amazon only operates in the US.

• Amazon hides its shipping costs.

• Amazon provides detailed information about its shipping losses.

• Amazon does not disclose any financial information.

What is a significant concern for investors in Chinese companies like Alibaba?

• High taxation rates.

• Limited market growth.

• Lack of transparency and visibility.

• Excessive government subsidies.

What is the nature of the shares owned by Alibaba's shareholders?

• Shares in a Cayman Islands Corporation that owns Alibaba shares.

• Direct shares in Alibaba.

• Shares in a European holding company.

• Shares in a US-based Alibaba subsidiary.