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Investing.com-- Shares of NIO Inc (HK:9866) slipped on Thursday after media reports stated that Singapore’s sovereign wealth fund GIC filed a lawsuit accusing the automaker of inflating its revenue through improper accounting practices.
The complaint, filed in New York federal court this week, alleges that Nio violated U.S. securities laws by prematurely recognizing revenue from the sale of battery assets to its battery-asset joint venture Weineng (Mirattery), in which it holds a minority stake.
GIC, a long-time institutional investor in the EV sector, claims Nio booked full revenue from battery sales at the time of transfer, instead of recognizing it gradually as lease payments, allegedly overstating earnings, media reports stated.
GIC is seeking damages for what it says were inflated stock prices that caused investor losses, reports said.
The complaint filed in August names Nio founder-CEO William Li and former CFO Steven Feng as defendants, a Caixin report stated.
Hong Kong-listed Nio shares fell 4.4% to HK$51.65 as of 05:02 GMT, hitting a one-month low.
The company is also listed in the U.S. and Singapore.
Earlier this month, a U.S. court stayed the case while awaiting the outcome of an earlier class-action lawsuit, reports showed.