US Moves to Audit Chinese Firms: WSJ
Chinese companies listed on US stock exchanges have not been subjected to inspections by US regulators, and the US Senate approved legislation that would require the Chinese firms to meet US standards. “Unlike other countries, China has never given U.S. regulators routine access to audit records needed to review the quality of financial accounting, according to U.S. officials, who have sought a deal for years,” reports the Wall Street Journal. “China says sharing audit work papers would violate its sovereignty and risk leaking state secrets.” The proposed legislation covers about 200 companies, worth about $1.4 trillion, according to one market analysis firm. The firms would also be required to report about any control by state authorities. Concerns emerged after disclosure of accounting fraud and fabrication of revenues at Luckin Coffee. The US Securities and Exchange Commission reports that its ability to enforce standards in emerging economies is limited. The US House of Representatives is expected to approve similar legislation, and under the Senate version, companies would have three years to comply. – YaleGlobal
US Moves to Audit Chinese Firms: WSJ
Under a US proposal, Chinese companies listed on US stock exchanges would join other firms in being subjected to regulatory reviews
Thursday, May 28, 2020
Read the article from the Wall Street Journal about a US proposal to extend regulatory requirements to Chinese firms listed on US stock exchanges.
Dave Michaels is a reporter in The Wall Street Journal's Washington bureau covering white-collar crime and financial enforcement.
Akane Otani is a reporter for The Wall Street Journal in New York, where she covers the U.S. stock market and investing. Prior to joining the Journal, she was a higher education reporter at Bloomberg Businessweek in New York.
Sebastian Pellejero contributed to this article.
Also read the article from the Wall Street Journal about Chinese firms that may decide to delist themselves from US stock exchanges.
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