PwC Hong Kong, KPMG China are first firms to host US regulator for audit inspections of mainland firms, sources say
- PwC and KPMG have already prepared the records to be made available on US-listed, China-based companies, sources say
- Inspectors of the US-based Public Company Accounting Oversight Board (PCAOB) have not yet arrived in the city but are expected soon
PwC Hong Kong and KPMG China are the first accounting firms that will help a US regulator carry out inspections of the audit work of US-listed mainland companies, part of a historic process that aims to head off mass delisting of Chinese companies from US exchanges.
The two firms have received notice that the Public Company Accounting Oversight Board (PCAOB) picked them for inspections of several of their audit clients, two sources familiar with the situation told the South China Morning Post.
Inspectors from PCAOB have not yet arrived in the city but are expected soon. They will serve the required three-day hotel quarantine before they begin work at the Hong Kong offices of the accounting firms, the sources added.
The two firms have already prepared the paper and electronic audit materials to be made available. All the records would have already been archived according to PCAOB standards, while auditors stand ready to be interviewed by the inspectors upon request, the sources said.
The two other Big Four accounting firms, Deloitte and EY, have not yet received notice from the PCAOB, but expect to be inspected as well, according to another two sources.