Caixin: Hong Kong Gets Chinese Audit Papers the U.S. Is Demanding
Thu December, 2020, Age: 2 years
As part of a 2019 understanding with the Chinese Finance Ministry, the Hong Kong Financial Reporting Council has obtained the first batch of audit papers from the mainland, becoming the first offshore regulator to break through the Chinese state’s secrecy barrier. Access to such documents has been a hot-button issue between China and the U.S. for more than a decade. China so far has refused to let inspectors from the American Public Company Accounting Oversight Board review audits of Chinese companies that trade on U.S. markets. That in turn led U.S. lawmakers to pass legislation this month to delist Chinese companies if access continues to be denied, while China has said it’s willing to work through the problem with the incoming Biden administration. The turmoil has already prompted a number of U.S.-listed Chinese companies to also start trading in Hong Kong, and regulators in the Asian financial hub say the audit access should be reassuring for investors.