Wal-Mart's China stores inflated profits: Report

A shopper checks out at a register at a Walmart in Los Angeles.
Jonathan Alcorn | Reuters
A shopper checks out at a register at a Walmart in Los Angeles.

Wal-Mart's retail business in China has been plagued by questionable accounting and unauthorized sales practices, according to Bloomberg News.

The company reportedly made business appear strong by making bulk sales to other retailers and tampering with inventory pricing. The markups accounted for 4 percent of the company's gross profits in 2010 while bulk sales were responsible for at least 1.6 billion yuan ($243 million) in revenue, according to Bloomberg.

"There is a general flexibility on ethics" Stanford Lin told Bloomberg. He conducted a 2010 internal review of Wal-Mart's business in China, "There was a huge desire to perform. In this market, they believe if they're hitting the numbers, then they're doing the right thing."

Read MoreWal-Mart scammed into selling PlayStation 4 for $90

Wal-Mart has said that it will close 30 out of its almost 400 stores in China and shed 250 jobs in merchandising and marketing.

Read the full report from Bloomberg.