China's government auditor has said that 18 out of 20 audited state-owned enterprises (SOEs) have inflated their revenue by 200 billion yuan (29 billion US dollars) and profits by 20.3 billion yuan (3 billion US dollars) in recent years. 

According to a report released by the National Audit Office on Friday, the 18 companies manipulated their financial reports by creating fake invoices and false sales, among other discrepancies.

The 20 centrally-administered companies include China National Petroleum Corporation, China Huaneng Group, Sinochem Group, and China State Shipbuilding Corp.

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The SOEs inflated revenue because their performance is one of the factors determining employee income and management promotion prospects, Zhu Boshan, founder of Tacter Management Consulting, told the National Business Daily newspaper. 

The report said that the 20 audited companies had put 38.5 billion yuan overseas investment and 60.6 billion yuan domestic investment at risk due to inadequate risk control measures and poor management.

In order to revive the country's bloated and debt-ridden state-owned sector, China has been accelerating mixed-ownership reforms. 

China has completed 48 deals allowing private capital to invest in SOEs by June 20, according to the China Securities Journal.

But private investors are concerned about not having enough say in management decisions and the issue of how to protect state-owned assets is also a challenge. 

China's centrally-administered SOEs are a large part of the country's economy. 

They paid 530 billion yuan in taxes in the first quarter of 2017, up 7.5 percent on the previous year, according to the State-owned Assets Supervision and Administration Commission.