The world of film and television begins in the ideal city

Chapter 21 Audit Team Deployment

"Hello, Mr. Huang, hello, Director Xia. We are here at Tianke for an audit as per the group's audit notice, and we hope you will both cooperate fully." Xu Feng said with a smile.

"Team Leader Xu, welcome. Tianke will definitely cooperate fully with the audit. Team Leader Xu, just tell us what you need, and we will do our best to ensure it. All employees in the company will cooperate."

"Of course." Xia Ming stepped aside to lead the way. "A dedicated conference room is ready, with network, printer, and filing cabinets all in place. The finance, contract, and cost managers are all on duty. I'll be there the whole time; if you have any questions, just come to me."

As we walked through the office area, the employees were all doing their jobs; no one was peeking around or whispering. It was as if Tianke had completely opened its doors, allowing the audit team to come and go as they pleased.

Xu Feng felt a chill run down his spine: The more Xia Ming cooperated, the more confident he was; he had already calculated what he could see and what he couldn't.

The audit team quickly got to work. The finance team buried themselves in piles of vouchers, the contracts team flipped through contracts and settlements, and the cost team checked the project ledgers and on-site approvals one by one.

He turned and went back to his workstation, his face grim as he ordered, "Focus on investigating subcontracting, visas, material prices, and insider trading."

Tianke cooperated actively, providing whatever materials the review team needed, and their hospitality was impeccable.

A week later, problems began to surface. But each one left the audit team in a dilemma.

Subcontracting advance payments exceeded the permitted percentage: long-term partner teams received advance payments of up to 35%, far exceeding the group's 20% limit. Xia Ming explained, "The client's payments are slow; if we don't advance payments, the teams stop work, and the project will be abandoned, resulting in even greater losses. That's how it's done in the industry."

Visa delays and incomplete procedures: concealed works, emergency changes, work done first, complete the paperwork later. Xia Ming frankly stated: "On-site procedures don't wait; the client is pushing hard, and the supervisor has to approve afterwards—this is common practice in the industry."

Material procurement prices are slightly higher: some main materials are 2-3 percentage points higher than the market price. Xia Ming bluntly stated: "Long payment terms, large upfront costs, and after-sales guarantees include hidden costs. The apparent price is high, but the overall cost is not high."

Large entertainment expenses lack details: Million-dollar expenditures only have a total amount, without a list or explanation. Xia Ming doesn't shy away from the topic: "Maintaining relationships with clients, supervisory units, and banks—everything that could be written on the receipt was written down."

The pricing of internal related-party transactions is too high: the price of goods purchased from the group's general contractors is higher. Xia Ming shrugged: "The group coordinates everything to ensure supply, qualifications, and payment collection, and subsidiaries have to bear the overall costs."

"Team Leader Xu, look..." The finance team leader handed over the documents. "The advance payment did exceed the group's red line, but every single one had an internal approval form, an explanation of the project's urgency, a progress commitment from the subcontractor, and even meeting minutes of verbal urging from the client. Although it doesn't comply with the group's explicit regulations, it was all to ensure the project's progress, and there's no trace of malicious violation."

Xu Feng took the paper and flipped through a few pages, his brow furrowing deeper and deeper. It wasn't that he didn't understand the construction industry. Municipal projects had tight deadlines, demanding clients, and if subcontractors stopped work or caused trouble, the losses far outweighed any extra advance payments. Almost no general contractor in the industry could rigidly adhere to a 20% advance payment ratio; they would adjust it to some extent based on the situation on-site.

If this is used to hold someone accountable, Tianke is innocent, and so are the other subsidiaries. If this gets out, people will only laugh at Yinghai Group for its lack of business acumen, rigid adherence to regulations, and unrealistic expectations.

"Write it down first," Xu Feng said in a deep voice. "Mark it clearly. It's a common practice in the industry. The procedure is irregular, but the motive is reasonable."

The finance team leader understood and silently wrote notes on the draft. Xu Feng looked at the list of issues, his face growing increasingly grim. These things, if included in the report, could only be considered internal control flaws, non-standard processes, and lax management. Criticism was acceptable, punishment was barely acceptable, and it was completely insufficient to use this to seize power, overturn the table, or take action against Huang Lilin and Xia Ming.

On the other hand, the contract team found themselves in the same predicament. They went through nearly three years' worth of visa applications, change orders, and settlement statements, and indeed found a large number of problems such as incomplete procedures, delayed signatures, and missing attachments. But when they called in the project manager, he had nothing but complaints.

"Team Leader Xu, you sit in the office, while we're out on-site." The old project director looked helpless. "Concealed works are poured in the middle of the night, emergency repairs start overnight, and verbal instructions from the client are executed immediately. When do we have time to sit down and slowly go through the procedures? We do the work first and then complete the paperwork. The supervisors and the clients all tacitly agree. That's how it is in the industry."

"It's true that the procedures were delayed, but the amount of work done was accurate, the price was reasonable, there was no false reporting, and no overcharging." The project manager shrugged. "If you really want to punish us for this, we'll accept it, but we won't accept it."

Xu Feng remained silent; he had no way to refute it.

These are unspoken rules that can't be openly discussed, but everyone knows them. They can be criticized internally and rectification can be demanded, but once they are written into a formal audit report and elevated to the level of "violations of rules and regulations," everyone at Tianke will inevitably be dissatisfied, and other subsidiaries within the group will feel insecure.

Zhao Xiankun wanted to intimidate Tianke and tighten his grip on power, not to expose all the unspoken rules of the entire group to the light of day.

He got up and walked to the window, looking at the busy employees coming and going in Tianke Company, feeling a mix of emotions.

Xia Ming walked up to him without him noticing, his voice low so that only the two of them could hear:

"Team Leader Xu, you and I both know that the audit has reached this point, which is enough."

"Xia Ming," Xu Feng slammed the list on the table, his voice low, "you did this on purpose. You laid out these common industry problems, leaving me with nothing to investigate."

He took a half step forward, his voice even lower: "Team Leader Xu, I believe the Chairman doesn't want anything to happen to Tianke either. If something happens to Tianke, how can Yinghai go public? If Tianke collapses, Tiancheng, Tianhe, and Tianzheng will all be ruined. What the Chairman wants is for the group to be stable, not to cut off its own arm."

The two men locked eyes, a silent struggle ensuing. Xu Feng's eyes held resentment and anxiety, while Zhao Xiankun desired to see the true state of Tianke's operations, something he clearly couldn't obtain from him. Xia Ming, on the other hand, exuded confidence and composure.

Xu Feng sat in the empty conference room, pen in hand, a deep disappointment in his heart. He had worked hard for several days, only to return empty-handed, disappointing the chairman.

Xia Ming pushed open the door and handed over a glass of warm water: "Team Leader Xu, thank you for your hard work."

Xu Feng looked up and slowly said, "There are process issues, management issues, and common industry problems. There are no major violations."

"Fair." Xia Ming nodded. "Tianke accepts."

Xu Feng was silent for a moment, then asked in a low voice, "You knew from the beginning that this was the only way I could investigate."

Xia Ming smiled faintly: "I just know what to hold onto and what to let go of. The best outcome is when everyone has a way out."

Xu Feng stood up and tidied up the working papers and computer. Had he lost? It seemed so. Had he won? It didn't seem so either. He had merely completed an audit that was destined to end there.