Why Did Evergrand Go Bankrupt: Financial Statement Analysis

Yanyi Liu ()
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Yanyi Liu: Bachuan International Education

A chapter in Proceedings of the International Workshop on Navigating the Digital Business Frontier for Sustainable Financial Innovation (ICDEBA 2024), 2025, pp 418-425 from Springer

Abstract: Abstract On January 29, 2024, Evergrande, a former Chinese real estate giant, officially declared bankruptcy. People unfamiliar with the complete story may have doubts about it and want to know the reasons behind it, so the research will be on why Evergrand will go bankrupt. This research will try to explore the answer to this question by analyzing the internal behaviour of the company and comparing data, including profitability, solvency and liquidity, efficiency and investment ratios. The conclusion is that Evergrande’s governance and PwC’s negligence led to Evergrand’s ultimate bankruptcy. The significance and importance of this research are to warn other real estate companies and even all companies in the market that good management must be carried out, internal control mechanisms must be strengthened, and financial cheating must be prevented by auditing institutions; regulatory authorities strengthen their scrutiny; enhance corporate social responsibility and keep consumers and investors’ rights and interests to improve the sustainable developments of the whole society.

Keywords: Evergrand; PwC; financial statement; liquidity issue (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-652-9_44

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DOI: 10.2991/978-94-6463-652-9_44

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