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China not preventing auditors from cooperating with foreign regulators: FM

作者:admin 2020-11-19

China not preventing auditors from cooperating with foreign regulators: FM

Zhao Lijian

China has never prevented accounting firms from providing audit working papers to foreign regulatory bodies, and it has always aimed at creating a favorable environment for orderly and sound operation of the global capital markets, Chinese Foreign Ministry spokesperson Zhao Lijian said at a press conference on Wednesday in Beijing.   

The comment came as the US Securities and Exchange Commission (SEC) is allegedly pushing forward a plan that could lead to some Chinese companies to be delisted from US stock exchanges. 

Under the reported SEC plan, Chinese companies listed in the US stock market would be required to hire auditors who are overseen by US regulators. Otherwise, the Chinese companies may lose their listings in the US exchanges, the Wall Street Journal reported. 

The report alleged that China has not been very cooperative in providing information of listed Chinese companies in the US.    

In response, Zhao said that Chinese regulatory departments have communicated with their US counterparts - the SEC and Public Company Accounting Oversight Board which supervises auditors - multiple times on "co-audit" plans, which underscores the sincerity of cooperation from the Chinese side. 

"China and the US should conduct communications and cooperation in a candid manner, based on their common interests, and this is the right way to solve any problems," Zhao said.

Nowadays, as the capital market has become highly globalized, the Chinese side firmly believes that strengthening supervision of the information disclosure of listed companies, and improving the professional standards of auditors are important to protect the legitimate rights of investors, according to Zhao.

"This is also the joint responsibility of global securities supervision bodies, and it must be done via strengthening cross-border supervision cooperation," Zhao said.

The SEC proposal marks the latest tough approach Washington is taking on Chinese companies as the Trump administration winds down.

On November 13, US President Donald Trump signed an executive order banning Americans from investing in Chinese firms that the administration says are linked to China's military.

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