Sacking of auditor prompts fresh worries across industry

Concerns have been voiced by the governing body of China's chartered accountants over the sacking of an accountancy firm by a Shanghai-listed company for failure to agree on an audit opinion.

Shenzhen Tianjian Xinde Certified Accountant, one of the largest audit firms in town, was sacked last Friday by its longstanding client Tonmac International, a mainland machine-tool company.

'We have noticed that some accountancy firms have been fired as they insisted on their rightful opinions,' said Chen Yugui, general secretary of the Chinese Institute of Certified Public Accountants (Cicpa). 'We pay close attention to this type of 'malignant sacking' of auditors. We want to make sure that the unreasonable demands of clients won't get by by switching auditors.'

The termination is the latest in a series that has affected a number of accountancy firms, sacked over disagreements concerning financial statements for last year.

The emergence of accounting irregularities in the United States has prompted concerns over the accuracy and reliability of financial data provided by publicly listed companies to investors.

Zhongtian Huazheng CPA suffered the same fate as Tianjian Xinde in April, when it failed to see eye-to-eye with its client, Shenzhen-listed Neimengu Hongfeng Industry.