Deloitte Touche Tohmatsu CPA auditors could be punished by the China Securities Regulatory Commission over work for an appliance maker, the Wall Street Journal reported, citiging a spokesman for the government regulator. Individual members of staff may be singled out, rather than the firm as a whole, over auditing for Guangdong Kelon Electrical Holdings. Top officials at Kelon were arrested in 2005 after a number of difficult years in terms of accounting. In August, Kelon Chairman Gu Chujun was fired apparently for overstating profits and misusing company funds. The case could act as a test of the extent to which accounting firms must keep their Chinese clients on the straight and narrow.
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