US Selects, Baidu, NetEase, Yum China After Alibaba For Audit Inspection

  • U.S. regulators have chosen e-commerce major, Inc J and KFC operator Yum China Holdings, Inc YUMC, among other U.S.-listed Chinese companies, for audit inspection starting next month, Reuters reports.
  • Both are in the first batch of Chinese firms for inspection in Hong Kong by the U.S. audit watchdog.
  • Baidu, Inc BIDU and NetEase, Inc NTES also feature in the audit inspection list, Bloomberg reports.
  • The regulators informed the accounting firm, including Deloitte, KPMG, PricewaterhouseCoopers, and Ernst & Young, of the audit work inspection.
  • U.S. regulators have selected Alibaba Group Holding Limited BABA and other U.S.-listed Chinese companies for audit inspections, likely to start next month. 
  • Earlier, the U.S. audit regulator forged an agreement with Chinese regulators to inspect and investigate registered accounting firms in China and Hong Kong.
  • The Public Company Accounting Oversight Board (PCAOB) acknowledged it as the most detailed and prescriptive agreement the regulator has ever reached with China.
  • U.S. regulators have been at loggerheads with China regarding access to their audit papers. 
  • As Beijing failed to impress U.S. regulators, Chinese e-commerce giants saw more of their shares shift to the Hong Kong market.
  • So far, Chinese companies listed in the U.S. dodged the regulations citing security concerns.
  • Price Action: JD shares traded higher by 1.80% at $62.62 in the premarket on the last check Wednesday.
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