China Housing & Land Announces Restatement of Historical Financial Statements Related to Accounting Treatment for Interest Rate

China Housing & Land Announces Restatement of Historical Financial Statements
              Related to Accounting Treatment for Interest Rate

--Effective interest rate corrected; non-cash impact does not affect net
income or net cash flows--

PR Newswire

XI'AN, China, Oct. 18, 2013

XI'AN, China, Oct. 18, 2013 /PRNewswire/ -- China Housing & Land Development,
Inc. ("China Housing" or the "Company"; Nasdaq: CHLN) today announced that,
during the review of the 2011 annual report and subsequent filings of China
Housing & Land Development, the staff of the U.S. Securities and Exchange
Commission initiated discussions and comments with the Company about the
Company's accounting treatment for the accretion cost concerning certain
non-controlling interest based on an effective interest rate of 45% (the
"Interest Rate"). Specifically, the SEC stated that there were certain
improper estimates used by the Company to calculate the Interest Rate. As a
result of the comment process, the Company revised the certain estimates,
which are now deemed to reasonably support an effective interest rate of 5.85%
(the "Revised Interest Rate").

On October 18, 2013, upon the recommendation of the Audit Committee of the
Board of Directors (the "Board") of China Housing & Land Development, the
Board determined that the Company should use the Revised Interest Rate rather
than the Interest Rate and that the relevant calculations should be made using
the Revised Interest Rate.

The use of the Interest Rate in preparing the Company's financial statements
resulted in certain material changes in (i) the Company's audited consolidated
financial statements for the years ended December 31, 2012, 2011 and 2010,
(ii) the Company's unaudited interim condensed consolidated financial
statements for the three months ended March 31, 2013 and 2012 and (iii) the
Company's unaudited interim condensed consolidated financial statements for
the three months and six months ended June 30, 2013 and 2012. As such, the
Board has determined that the financials (the "Prior Financials") provided in
the Company's Form 10-K for the year ended December 31, 2012, the Company's
Form 10-Q for the quarter ended March 31, 2013 and the Company's Form 10-Q for
the quarter ended June 30, 2013 (collectively, the "Filings") should not be
relied upon.

The Company will file amendments to the Filings to restate the Prior
Financials using the Revised Interest Rate.

The Company is working on the impact of restating the Prior Financials and
would like to address the following information related to the restatement:

1.It is expected that the one-time charge to retained earnings and mandatory
    redeemable non-controlling interest in subsidiaries in 2010 will be
    increased by approximately $33 million. The charge to retained earnings is
    a capital transaction and it is expected that the charge will only impact
    other comprehensive income but not net income.
2.It is expected that 2010 earnings per share will be reduced significantly
    (and reflect a loss per share) and that there will be an increase to
    earnings per share in the 2011 and 2012 fiscal years, and the first and
    second fiscal quarters of 2013.
3.It is expected that the accretion interest capitalized in project costs
    will be reduced, which is expected to result in an overall reduction in
    cost of sales in future periods and should improve overall future net
    income and earnings per share.
4.As of December 31, 2012, the liability payable to Prax Capital, which is,
    in part, the subject of the restatement, had already been fully paid off.
5.The restatement is not expected to have an impact on net cash flow.

Mr. Cangsang Huang, China Housing's CFO, commented, "While we are disappointed
to restate select historic financial results, we'd like to point out that this
restatement is a non-cash adjustment that will not negatively impact our
future net income or net cash flows nor does it impact our future operation
and expansion plans. We will continue to discuss these matters with our
auditors and plan to file amendments to our financial results for the
aforementioned periods as soon as practicable."

"The state of the real estate environment in the region in which we operate
remains favorable and overall real estate demand remains healthy. We remain
highly encouraged by the opportunities associated with China's Housing's
development projects and look forward to disclosing our upcoming 2013 Q3
results to investors in mid-November."

Further information regarding the Company's restatement can be found in its
Form 8-K filed with the SEC today.

About China Housing & Land Development, Inc.

Based in Xi'an, the capital city of China's Shaanxi province, China Housing &
Land Development, Inc., is a leading developer of residential and commercial
properties in northwest China. China Housing has been engaged in land
acquisition, development, and management, including the sales of residential
and commercial real estate properties through its wholly-owned subsidiary in
China, since 1992.

China Housing & Land Development is the first Chinese real estate development
company traded on NASDAQ. The Company's news releases, project information,
photographs, and more are available on the internet at www.chldinc.com.

Safe Harbor

This news release may contain forward-looking information about China Housing
& Land Development, Inc. which is covered under the safe harbor for
forward-looking statements provided by the Private Securities Litigation
Reform Act of 1995. Forward-looking statements are statements that are not
historical facts. These statements can be identified by the use of forward-
looking terminology such as believe, expect, may, will, should, project, plan,
seek, intend, or anticipate or the negative thereof or comparable terminology,
and include discussions of strategy, and statements about industry trends and
China Housing & Land Development's future performance, operations, and
products.

Such statements are subject to risks and uncertainties that could cause actual
results to differ materially from those projected. Actual performance results
may vary significantly from expectations and projections. Further information
regarding this and other risk factors are contained in China Housing's public
filings with the U.S. Securities and Exchange Commission.

All information provided in this news release and in any attachments is as of
the date of the release, and the companies do not undertake any obligation to
update any forward-looking statement as a result of new information, future
events or otherwise, except as required under law.

China Housing contacts
Mr. Cangsang Huang
Chief Financial Officer
Tel: +86 29.8258.2648 in Xi'an
Email: chuang@chldinc.com

Ms. Jing Lu
Chief Operating Officer, Board Secretary, and Investor Relations Officer
+86 29.8258.2639 in Xi'an
jinglu@chldinc.com/ English and Chinese

Mr. Shuai Luo, CFA
Head of Investor Relations
+86 29.8258.2632 in Xi'an
Laurentluo@chldinc.com / English and Chinese

Mr. Bill Zima, ICR
+86 10 6583 7511
William.Zima@icrinc.com

China Housing Investor Relations Department
+1 646.308.1285

SOURCE China Housing & Land Development, Inc.

Website: http://www.chldinc.com
 
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