September 17, 2019

Deal Between PCAOB, Chinese Is a Lose-Lose Situation

Yes, the PCAOB got a lousy deal by putting Jim Doty's name on the Memo of Understanding with China's Securities Regulatory Commission and Ministry of Finance, but Professor Paul Gillis writes in the Wall Street Journal that the Chinese don't have any room to talk, either:

Without inspections, investors can't trust Chinese audits. Investors in Chinese companies are currently on a buyer's strike because of the widespread accounting scandals. Audit inspections would help to restore some credibility to Chinese financial reports, and perhaps open up access to the capital markets again. China's IPO markets have been nearly shut down, and its entrepreneurial companies are being starved for capital. If IPO markets do not reopen soon, China risks damaging indigenous innovation.  

[Paul Gillis/WSJ, Earlier]

Have something to add to this story? Give us a shout by email, Twitter, or text/call the tipline at 202-505-8885. As always, all tips are anonymous.

Related articles

Marcum’s Microcap Conference Seemed Like a Great Event for Auditor Independence Violations

In the storied history of auditor independence violations by PCAOB-registered accounting firms, Marcum broke the rules in a rather unique and spectacular way: it publicly advocated its audit clients as investment opportunities. The PCAOB was probably giddy writing and sending out this press release on Sept. 10: The Public Company Accounting Oversight Board today announced […]

Ex-KPMG Partner’s Request to Have His Wire Fraud Conviction Thrown Out Gets Shot Down, Crashes, Burns

Welp, so much for that. David Middendorf, former national managing partner for audit quality and professional practice at KPMG, is scheduled to be sentenced in Manhattan federal court tomorrow, according to Law360, for his role in an information-stealing scheme in which PCAOB insiders fed KPMG executives secret plans on which of the Big 4 firm’s […]