Shares of Chinese social network Renren (ticker symbol RENN) successfully debuted yesterday on the New York Stock Exchange (NYSE), climbing more than 50% intraday before closing up 20% from their opening despite reports of the last minute resignation of the head of its auditing committee and disclosures of material weaknesses in its accounting.

It’s well known that some accounting practices at Chinese companies can be questionable when judged by U.S. generally accepted accounting principles. Disclosures of material accounting weaknesses have been particularly common among them in recent months, according to Morningstar IPO strategist Bill Buhr. “Almost every time we look at some of these Chinese IPOs that have come down recently, you get to the risks section and it says their auditing team discovered a material weakness or an accounting deficiency,” Buhr said. “There’s been a lot of concern, and not just with Chinese IPOs, about the potential for fraud with these kinds of terms. But Chinese IPOs have had a really, really strong performance.”

Investors are having trouble figuring out if these disclosures really mean anything, which might explain their willingness to buy into the IPOs. “A lot of times it might just be weak accounting processes, a lack of knowledge, or just a bit of sloppiness,” Buhr says. “I feel like we hold U.S. companies to a higher standard. Because these are private companies going public, they do way more due diligence around their numbers and their books as they prepare for it. But you probably do see [material weaknesses] slightly more with new companies.”

As reported in an item in today’s Wall Street Journal (wsj.com), long-term investors might ultimately shun such companies over concerns about material weaknesses, but, for now, Chinese IPOs in the U.S. have had huge momentum with short-term traders. The last 20 Chinese IPOs to list on U.S. exchanges averaged returns of 22.1% on their first day of trading, according to data from Dealogic. And while many have made such disclosures, they have managed to keep up performance. Over three months of trading, the 15 most recent Chinese IPOs have averaged a return of 18% since their IPO.

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