China is proposing to let US regulators audit its state-owned enterprises (SOEs) in a concession aimed at solving their long-running accounting dispute, but would insist on redacting some information on national security grounds, reported Bloomberg.
The United States has long complained of lack of access to audit working papers for US-listed Chinese companies. Washington earlier this month threatened measures to delist Chinese firms that fail to meet its auditing requirements.
Fang Xinghai, vice chairman of the China Securities Regulatory Commission (CSRC), told Bloomberg that CSRC this month sent the US Public Company Accounting Oversight Board (PCAOB) a fresh proposal that would allow the US authorities to pick any of its SOEs for a trial joint inspection. A previous trial inspection done jointly by Chinese and US regulators failed to yield an agreement.
“For more than a decade we have sought to establish a cooperative relationship with China…Such a relationship, however, cannot be meaningfully pursued without the Chinese first embracing our core access principles,” said PCAOB chairman William D. Duhnke III in a statement.