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China Enhances Supervision on Auditing
The Financial institutions seeking a domestic public listing should be audited by both overseas and domestic accounting firms, China's top securities regulator announced Tuesday.
The China Securities Regulatory Commission and the Ministry of Finance jointly issued a circular yesterday, saying that the audit by the two accounting firms should be conducted separately.
The move is aimed at ensuring the accuracy of the financial figures for banks, insurers and securities firms applying for public listing according to international standard.
It will also facilitate better supervision from regulators over their performance and information disclosure after the listing and help investors make appropriate investment decisions.
Overseas accounting firms should first acquire a temporary license from the CSRC and the Ministry of Finance, and the license needs to be renewed each year, the circular said.
The Chinese authorities will supervise the services of the authorized accounting firms, and those who fail to meet the standards will have their licenses permanently canceled, the paper said.
The CSRC has already designed special regulations for information disclosure, and pledged to improve the efficiency and transparency of recruiting overseas employees this year.
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