Chinese e-commerce giant Alibaba's share dived almost 7 percent on Wednesday. That came as Alibaba's annual report showed that the U.S. Securities and Exchange Commission is investigating the American-listed company over its accounting practices.

The U.S. Securities and Exchange Commission is investigating Alibaba Group's accounting practices to determine whether they violated federal laws. The main focus of the investigation includes the company's growth rate and its relations with affiliated companies, especially the logistics firm Cainiao Network.

Cainiao Network is owned by Alibaba and several other Chinese courier companies. Alibaba holds 47 percent of the firm's shares, which means, theoretically, it can exclude Cainiao's deficit from its annual report. That is the core debate of Alibaba's accounting methods.

Alibaba spokesman Robert Christie said the company's annual report included Cainiao profit, revenue and balance sheet data. He said that the figures are the kind of information that will address the underlying issues in the SEC’s inquiry.

Information transparency is a major issue for U.S.-listed Chinese companies. Alibaba has made some changes to meet the inquiry. For example, it has said it will release new businesses' cost structures and profit data this year.

Alibaba says the current investigation should not be seen as an indication that the company has violated federal securities laws. Moreover, it said that it was actively cooperating with investigators.