SEC said to demand auditing documents
By Feng Jianmin |
June 21, 2012, Thursday
|
Print Edition
Print Edition
THE US securities regulator has reportedly ordered the China branches of the Big-Four auditing firms to hand over audit papers of US-listed Chinese firms, as a conflict over the two countries' regulatory measures continues.
The US Securities and Exchange Commission has filed formal requests to the auditing firms demanding them to hand over documents about the Chinese companies, Reuters reported yesterday, citing insiders.
The move came after some US-listed Chinese firms, including Sino-Forest, Qihoo 360, Focus Media and Longtop Group, were alleged by US research firms of having committed accounting frauds since middle last year.
Under Chinese law, Chinese auditors are not allowed to hand over working documents to foreign securities regulators without approval from the Chinese authorities.
The New York headquarters of PricewaterhouseCoopers confirmed to Reuters the firm has received formal and informal requests "at various times" from the SEC for audit documents from China, and the firm is dealing with different laws in the two countries.
A contact from Deloitte Shanghai, which was sued by the SEC on May 9 after it rejected passing documents relating to an unnamed Chinese company, said the auditor has not received any similar requests since May.
The other auditing firms may face similar charges as Deloitte if they refuse to turn over the required documents, Reuters said, citing a Washington-based lawyer.
If they lose the case, the SEC will ban them from auditing Chinese-listed firms in the US, which may be delisted, the lawyer said.
The US Securities and Exchange Commission has filed formal requests to the auditing firms demanding them to hand over documents about the Chinese companies, Reuters reported yesterday, citing insiders.
The move came after some US-listed Chinese firms, including Sino-Forest, Qihoo 360, Focus Media and Longtop Group, were alleged by US research firms of having committed accounting frauds since middle last year.
Under Chinese law, Chinese auditors are not allowed to hand over working documents to foreign securities regulators without approval from the Chinese authorities.
The New York headquarters of PricewaterhouseCoopers confirmed to Reuters the firm has received formal and informal requests "at various times" from the SEC for audit documents from China, and the firm is dealing with different laws in the two countries.
A contact from Deloitte Shanghai, which was sued by the SEC on May 9 after it rejected passing documents relating to an unnamed Chinese company, said the auditor has not received any similar requests since May.
The other auditing firms may face similar charges as Deloitte if they refuse to turn over the required documents, Reuters said, citing a Washington-based lawyer.
If they lose the case, the SEC will ban them from auditing Chinese-listed firms in the US, which may be delisted, the lawyer said.
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