Civilization's Warning and the Beast's Fangs (Part One)
The largest boardroom is located on the top floor of NLG's headquarters building.
At 10:00 AM sharp, sunlight streamed through the huge floor-to-ceiling windows, casting bright spots of light on the long, dark walnut conference table that gleamed like a mirror, but it couldn't dispel the stagnant, heavy atmosphere inside.
The air conditioning system emitted a low hum, mixed with the scent of the premium leather seats, and an even more indescribable tension, the tension that precedes a power struggle.
On one side of the long table, seven or eight people sat sparsely. They were shareholders or representatives holding more than 3% of NLG's shares, and their expressions varied.
Calvin Roth sat near the head of the table, his obese body straining against his expensive custom-made suit. He deliberately maintained a calm, slightly arrogant expression, his fingers unconsciously twirling the large gold ring on his ring finger.
John Pittman, standing next to him, appeared more anxious, frequently adjusting his tie. Lisa Chen, representing the pension fund, sat upright with an open laptop and notebook on her lap, displaying a professional demeanor. The other shareholders either whispered among themselves or observed in silence.
On the other side of the long table sat several executives who were not immediately affected by the audit storm, including Senior Vice President of Operations Frank Miller and Sales Director Sarah Jenkins.
Both deliberately avoided direct eye contact with the shareholders opposite them. Their expressions appeared calm, but their slightly tense jaws and the occasional movement of their Adam's apples betrayed their inner unease.
All eyes were focused on the head seat at the far end of the long table, the seat that symbolized the center of power.
K entered the meeting room on time.
Today he wore a perfectly tailored navy blue double-breasted suit, a white shirt, and a very dark tie, making him look stern, upright, and meticulous.
His face was expressionless, as calm as if he were just attending a routine morning meeting. Behind him were a temporary assistant and a technician carrying a projector, but the assistant and technician stopped at the door, and only K walked to the head of the table.
His steps were steady, the heels clicking softly and rhythmically on the carpet. Without looking at anyone, he walked straight to the head of the table, placed a slim tablet on it, pulled out a chair, and sat down. His movements were concise and unhesitating, exuding an air of self-assured control.
"Good morning, everyone." K's voice rang out, not loud, but clear enough to reach everyone's ears, breaking the silence in the meeting room. He didn't exchange pleasantries or make any opening remarks, going straight to the point, "Thank you all for taking time out of your busy schedules to attend this extraordinary Great East is to inform you about the company's recent situation, as well as some key issues discovered by the preliminary review conducted by the independent third-party audit team."
He gestured for the technicians to connect the projector. "First, please have Mr. Howard James, the head of McKinsey-Holt firm, give a brief report on the initial findings of the audit."
The side door of the conference room was pushed open, Howard James, with his silver hair and serious face, walked in carrying a thin laptop. He nodded slightly to K, then walked to the projection screen and connected the computer. Throughout the process, the conference room was completely silent, except for the slight sounds of equipment being connected and the slightly heavy breathing of some people.
The projector lit up, revealing a dark blue cover with the "McKinsey-Holt" logo and the title "Summary of NLG's Preliminary Audit Findings".
"Distinguished directors and shareholder representatives," Howard's voice was dry, carrying the calm and unwavering authority characteristic of an auditor, "At the request of NLG's new management, our team has conducted a preliminary, directional review of the company's finances, procurement, operations, and the performance of some senior executives over the past three years. Below are some key issues we have identified that require our attention."
He didn't use any inflammatory language; he went straight to the first slide of the PowerPoint presentation.
"Topic 1: Systemic Procurement Premium"
A clear comparison chart appears. On the left is the diesel price curve from NLG's purchases from four major fuel suppliers over the past three years, and on the right is the average spot price curve for diesel in the North America market during the same period. The two curves are parallel for most of the time, but NLG's purchase price curve remains consistently high, showing a significant difference.
"Based on publicly available market data and comparisons with industry procurement databases," Howard pointed to the chart with a laser pointer, "NLG's purchase prices from suppliers A, B, C, and D have consistently and systematically been higher than the market average over the past 36 months. The average premiums are 18%, 22%, 31%, and 19%, respectively." He switched pages to display another chart, "For fuel alone, preliminary estimates suggest an additional expenditure of approximately $28 million over three years."
He then switched to a similar chart for parts procurement, which showed the same situation, involving five other suppliers with premiums ranging from 15% to 35%, and estimated additional expenses exceeding $17 million.
"Preliminary investigation into the equity structure of the aforementioned nine suppliers reveals indirect connections with relatives of NLG's former Vice President of Purchasing and a current shareholder of the company," Howard's tone remained calm, but every word struck a nerve, "And the relevant contract approval processes have significant flaws."
The air in the conference room seemed to have been sucked away. Calvin Roth's cheek muscles twitched slightly, and he stopped turning his ring. John Pittman's forehead began to sweat. The "current shareholder" who was called out turned pale instantly.
"Agenda Item Two: Questionable Markets and Consulting Fees"
The PowerPoint presentation listed several company names and payment records.
"Over the past three years, NLG has paid a total of $22.3 million to six consulting and marketing service companies, including E, F, and G. The contract service descriptions were vague, such as 'strategic relationship maintenance,' 'industry image optimization,' and 'crisis early warning consulting.' The deliverables acceptance criteria were either lacking or highly subjective. The audit team was unable to find any quantifiable service deliverables within the company that matched the aforementioned fees."
Howard paused, then added, "Four of these companies are registered in offshore centers such as the Cayman Islands and the British Virgin Islands, and the actual controllers cannot be verified. The timing of some large payments closely coincides with the periods before NLG received regulatory inquiries or issued major negative announcements."
Sales Director Sarah Jenkins' breathing quickened noticeably, and her fingers gripped the pen tightly.
"Agenda Item 3: Suspicion of Conflict of Interest Among Senior Executives"
The charts on this page are relatively simple, but even more shocking. They are screenshots of expense reports, credit card statements, and travel records, juxtaposed with spending records from certain high-end venues (luxury clubs, luxury stores, and overseas luxury resorts), with the time, location, and amount matching remarkably well. At least three former executives and one current executive are involved.
"Preliminary investigations have confirmed that the expenses exceeding $8 million were reimbursed under the guise of 'business entertainment' and 'customer relationship building,' but no evidence of customer involvement or relevant business background could be provided. Some of the expenses were clearly personal in nature."
Frank Miller's neck was slightly red; he loosened his tie and avoided eye contact.
"Agenda Item 4: Severely Uncontrolled Project Costs and Abnormal Fund Flows"
The last few slides of the presentation showed a comparison between the budgets and final settlements of several IT and infrastructure projects, revealing alarming overspending rates. They also included a complex flowchart illustrating the short-term return of several large sums of money after they were initially allocated.
"Some project contractors have close relationships with NLG management. The unusual fund transfers exhibit typical characteristics of 'bridging' or 'concealment,' and their specific purposes require further investigation."
Howard finished his presentation, put away the laser pointer, and looked at K: "Mr. K, that concludes my brief presentation. The detailed report has been submitted."