Document Type

Journal Article

Department/Unit

Department of Accountancy and Law

Title

Could complying with China's secrecy laws be an excuse for auditors not to provide their working papers of auditing Chinese companies? Recent cases in the United States and Hong Kong

Language

English

Abstract

In recent years, many Chinese companies have been listed on overseas stock exchanges to solicit funding from international investors. Auditors of these companies are required to serve as an independent gatekeeper in providing assurance for the integrity and accuracy of the financial reports of these companies. Yet, when overseas regulators commenced investigations on the financial irregularities of these companies, their auditors refused to produce the relevant audit working papers, citing China’s secrecy laws as an excuse for preventing them from doing so. The paper examines the recent court cases in both Hong Kong and the United States in relation to the proceedings initiated by regulators against those auditors. It also compares the similarities and differences of these court cases and the auditor regulatory regimes in these two jurisdictions. It concludes that the issues faced with the two jurisdictions are different. Solutions to the problems encountered in the auditor regulatory regimes should take these differences into consideration.

Keywords

State Secrecy Law, Auditor, Securities Regulation, Stock Exchange, Hong Kong, United States

Publication Date

2015

Source Publication Title

Kings Law Journal

Volume

26

Issue

1

Start Page

99

End Page

128

Publisher

Taylor & Francis

DOI

10.1080/09615768.2015.1035129

ISSN (print)

09615768

ISSN (electronic)

17578442

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