Montage Announces Final Audit Committee Report

Montage Technology Group Limited

("Montage Technology" or "Montage" or the "Company"), a global fabless provider of analog and mixed-signal semiconductor solutions addressing the home entertainment and cloud computing markets, today announced that on October 4, 2014, the audit committee of the board of directors of the Company completed its review of allegations contained in reports issued by short sellers. On October 8, 2014, the audit committee presented the report on its review to the board of directors of the Company. Following an extensive review conducted by the Company's audit committee with the assistance of the law firm of Jones Day as well as forensic accountants from FTI Consulting, the audit committee and the Company have concluded that no changes to the Company's previously reported unaudited financial results are required. This conclusion is based upon the additional investigative procedures that were performed following the audit committee's preliminary conclusions as reported on April 22, 2014. The extensive review was initiated in February 2014 and reflects over 11,500 hours of work by the audit committee's advisors. The report is based on the various investigative procedures performed during the course of the review and subject to certain limitations, qualifications and caveats. Investigative procedures included analyzing the majority of the Company's cash, cash equivalents, and short-term investment balances with its financial institutions at various points in time as well as analyzing the majority of the Company's revenue and gross margins, and written confirmations and in-person site visits with selected participants in the manufacturing and supply chain and the distribution and sales channel, including the primary fabless semiconductor vendor, assembly/testing vendors (OEMs), distributors, including LQW, and end customers. Various analyses of financial and accounting records were also performed, in addition to review of other documentation and data, and interviews of Company personnel and third parties. The audit committee and its advisors presented the conclusions of the audit committee's review to the Company's independent auditors on October 10, 2014, which included recommendations for further improvements in internal controls and other enhancements. The Company's independent auditors are in the process of reviewing the audit committee's report and evaluating the scope, execution, findings and remedial actions and results of the audit committee's investigation as well as assessing their impact on the audit of the Company's financial statements for the year ended December 31, 2013 and review of quarterly financial information for the periods ended March 31, 2014 and June 30, 2014, which need to be completed before the Company can file its annual report on Form 10-K and quarterly reports on Form 10-Q. Additionally, on October 8, 2014, the Company received correspondence from the Nasdaq Hearings Panel granting the Company a hearing to appeal its delisting. The hearing is scheduled for November 6, 2014.