ANI
21 Sep 2022, 17:37 GMT+10
Tokyo [Japan], September 21 (ANI): Dozens of American inspectors from the US Public Companies Accounting Oversight Board (PCAOB) are set to start reviewing the audit records of top Chinese companies listed in New York this week in Hong Kong under a deal reached in August, Nikkei Asia reported.
Since the start of the century, Washington has required all publicly traded companies to provide the PCAOB with the ability to inspect their auditors. However, China has long resisted the calls, citing national security concerns.
Back in 2020, US lawmakers brought in the Holding Foreign Companies Accountable Act, forcing Beijing to comply with the law. The law effectively started compelling China and the US to reach an agreement to allow for the PCAOB to inspect the audits.
Under the law, companies that are found to not have allowed the PCAOB complete access would risk being kicked off US stock exchanges.
Writing for the Japanese financial newspaper, China analyst Andrew Collier argued that the pact marks a step in the right direction and a good faith effort between the two countries to maintain good financial relations, but it will likely end in tears on both sides.
Collier said China is desperate to make sure that its companies can access American markets through initial public offerings and other capital-raising efforts.
"Under the US Holding Foreign Companies Act of 2020, stocks worth USD 1.3 trillion could be forced off American exchanges unless Washington regulators are allowed to conduct independent financial audits. For its part, the US would like to maintain engagement with China within its own regulatory boundaries," he added.
Collier said that both sides have few incentives to make more than a halfhearted effort to meet in the middle. The public statements from each side are so far apart that this seems no more than a test case for failure as yet, he added.
According to the China analyst, the US is clearly much less interested than it used to be in financial engagement with China and is also concerned about the lack of transparency in how Chinese companies operate and the degree to which they are state-controlled.
PCAOB Chair Erica Williams in a statement last month had said the real test will be whether the words agreed to on paper translate into complete access in practice.
"On paper, the agreement signed today grants the PCAOB complete access to the audit work papers, audit personnel, and other information we need to inspect and investigate any firm we choose, with no loopholes and no exceptions. But the real test will be whether the words agreed to on paper translate into complete access in practice," Williams had said. (ANI)
Get a daily dose of Shanghai Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Shanghai Sun.
More InformationRAMALLAH, Wet Bank - A two-and-a-half-year-old Palestinian boy shot in the head by Israeli troops has died in hospitalThe boy, ...
NEWARK, New Jersey: Six years after his 2016 presidential campaign failed to succeed, Chris Christie, former New Jersey Governor, will ...
TOKYO, Japan: To counter the declining national birthrate, Japan's Prime Minister Fumio Kishida pledged to double spending over the next ...
WASHINGTON D.C.: Reuters has reported that on 7th June, former Vice President Mike Pence will enter the race for the ...
PYONGYANG, North Korea: North Korea attempt failed to launch a satellite on May 31, which prompted raid sirens and a ...
HONG KONG, China: Describing the lack of women in China's top leadership as concerning, the United Nations has recommended the ...
CHARLESTON, South Carolina: During a media tour this week at Boeing's facilities in Charleston, South Carolina, company CEO Dave Calhoun ...
BEIJING, China: On his return to China after a three year absence, which is his company's largest production hub, Tesla ...
Berlin [Germany], June 6 (ANI): India's continuing dependence on Russian weapons is not in Germany's interest, said German Defence Minister ...
New Delhi [India], June 5 (ANI): On the occasion of World Environment Day, Prime Minister Narendra Modi on Monday said ...
The U.S. military Monday released a video of what it described as an "unsafe" Chinese maneuver in the Taiwan Strait ...
New Delhi [India], June 5 (ANI): Visiting United States Secretary of Defence Lloyd Austin on Monday said that the world ...