The long-running audit dispute over Chinese firms listed in the US could finally be close to a resolution after it was reported a US watchdog had completed its inspection work.
The seven-week-long onsite work by the Public Company Accounting Oversight Board (PCAOB), the US audit watchdog, ended on Friday, sources said.
The inspection started in Hong Kong after the two countries signed a pact in August to resolve a dispute that threatened to exclude more than 200 Chinese companies, including tech giant Alibaba Group Holding Ltd, from US exchanges.
A spokesperson for the PCAOB declined to comment.
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Two of the sources said it was too early to tell whether the onsite inspection had been to the satisfaction of the US agency, which has said it would not accept any curbs on its access to the audit papers of New York-listed Chinese firms.
Chinese markets soared on Friday, with news of an end to the onsite inspection of audit papers raising hopes that the US officials were satisfied, and added to broader optimism that China may ease its tough Covid restrictions.
Reuters reported in August that US regulators had picked a number of US-listed Chinese companies, including e-commerce groups Alibaba and Yum China Holdings Inc for onsite audit inspection.
Some of the PCAOB staff, who were carrying out the onsite inspections into the Chinese companies audit papers, will return to the United States over the weekend, said the first source and a fourth source familiar with the matter.
The first source said on Friday despite the wrapping up of the watchdog’s onsite work, inspection will continue and the US agency may seek more information after returning, in accordance with standard inspection procedure.
The inspection will formally wrap up when a final report is issued on whether China as a market is accessible to US regulators, which is expected in weeks, this source said.
US regulators have for more than a decade demanded access to audit papers of US-listed Chinese companies, but Beijing has been reluctant to let US regulators inspect its accounting firms, citing national security concerns.
- Reuters with additional editing by Sean O’Meara
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