China securities regulator sends new proposal on U.S. audits
China’s securities regulator said it has sent U.S. authorities a fresh proposal about co-auditing Chinese firms, days after Washington moved to tighten rules for stock listings from the Asian nation.
The new plan, sent Aug. 4, takes into account the latest U.S. demands, the China Securities Regulatory Commission said in a statement on Saturday, without elaborating.
It added that it has communicated with the U.S. Securities and Exchange Commission and Public Company Accounting Oversight Board multiple times in addressing auditing issues, and has never prevented accounting firms from providing audit work papers to overseas regulators.
Such exchanges of information should be conducted through mutual cooperation, the CSRC said.
A high-powered group of U.S. financial regulators said on Thursday that stock exchanges should set new rules that could trigger the delisting of Chinese companies, reflecting mounting concerns that investors are being exposed to fraud.
The recommendations target a problem that has vexed U.S. regulators for more than a decade: China’s refusal to allow inspectors from the Public Company Accounting Oversight Board to review audits of Alibaba Group Holding Ltd., Baidu Inc. and other Chinese firms listed on U.S. exchanges.
The issue has gained added urgency due to rising tensions between Washington and Beijing and following this year’s high-profile accounting scandal at Luckin Coffee Inc.