The U.S. audit regulator forged an agreement with Chinese regulators to inspect and investigate registered accounting firms in China and Hong Kong, Reuters reports.
The Public Company Accounting Oversight Board (PCAOB) acknowledged it as the most detailed and prescriptive agreement the regulator has ever reached with China.
The PCAOB said the agreement would allow it “sole discretion to select the firms, audit engagements and potential violations it inspects and investigates – without consultation with, nor input from, Chinese authorities.”
The inspectors could “view complete audit work papers with all information included and for the PCAOB to retain information as needed.”
U.S. regulators have been at loggerheads with China regarding access to their audit papers.
Earlier, Chinese e-commerce giants saw more of their shares shift to the Hong Kong market as Beijing failed to impress U.S. regulators.
By Friday, the U.S. identified 163 companies, including Alibaba Group Holding Limited BABA, JD.com, Inc J, and NIO Inc NIO, as facing trading prohibition risks for not complying with audit requirements.
So far, Chinese companies listed in the U.S. dodged the regulations citing security concerns.
Recently, the Chinese government launched a new stimulus package to boost economic activity.
The package reportedly includes over 300 billion yuan ($43.8 billion) in spending for various policy and financial tools.
Price Action: BABA shares traded lower by 0.79% at $99.11 on the last check Friday. JD shares traded lower by 0.77% at $64.11.
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Image and article originally from www.benzinga.com. Read the original article here.