SEC Warns Companies Switching Auditors Not To Skirt Rules

By Tom Zanki (September 7, 2022, 5:15 PM EDT) — The U.S. Securities and Exchange Commission’s chief accountant is warning China-based companies that they could face enforcement actions if they switch auditing firms in order to remain listed in the U.S. unless certain protocols are followed.

The statement follows a recent agreement between U.S. and Chinese regulators that will allow Chinese companies to avoid being delisted from American exchanges if they let U.S. audit inspectors review the financial statements of such companies, tentatively resolving a yearslong spat between the two countries.

SEC Chief Accountant Paul Munter said regulators have noted that foreign companies, mainly those based in Hong Kong and China,…

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