Longtop Financial auditor Deloitte Touche has resigned over potential false reporting by the company, specifically over cash, loan, and potentially sales data, according to Bloomberg.

The company, which currently has a market cap of $1.08 billion, was targeted by a short-sellers in April after a blog post suggesting fraud at the firm was published. Its shares collapsed from a price of around $33 at the start of April, to around $19 today. The company IPO'd in 2007.

The company is a software firm that sells its product to firms in the banking and insurance sectors in China.

The full reason for the Deloitte's resignation, from the Longtop announcement (via Bronte Capital):

In its letter, DTT stated that it was resigning as the result of, among other things (1) the recently identified falsity of the Company's financial records in relation to cash at bank and loan balances (and possibly in sales revenue); (2) the deliberate interference by certain members of Longtop management in DTT's audit process; and (3) the unlawful detention of DTT's audit files. DTT further stated that DTT was no longer able to rely on management's representations in relation to prior period financial reports, that continued reliance should no longer be placed on DTT's audit reports on the previous financial statements, and DTT declined to be associated with any of the Company's financial communications in 2010 and 2011.

The company delayed filing its annual report with the SEC on May 17, and its shares have not traded since then. It is also currently under investigation by the SEC.

Just last week, after Longtop Financial stopped trading, John Hempton at Bronte Capital broke down why the firm's accounts seemed out of whack.

"If I had to guess I would think that revenue is faked (see 11), margin is faked (see 10), hence cash on the balance sheet if it is there (see 7) does not have the source the company would want you to think it has," Hempton wrote.

Check out John Hempton's full breakdown of Longtop Financial here >