An accounting firm assists mainland Chinese enterprises in listing overseas.

Provisional Regulations for Audit Services

Article 1   To standardize the audit practices of accounting firms engaged in overseas listings of mainland Chinese enterprises and to promote lawful business cooperation between domestic and foreign accounting firms, these Interim Provisions are formulated in accordance with the Certified Public Accountants Law of the People’s Republic of China and other relevant laws and regulations.

Article 2   The overseas listing audit services referred to in these Provisional Regulations refer to the financial statement audits and post-listing annual financial statement audits provided by accounting firms in connection with Chinese mainland enterprises’ direct or indirect issuance of stocks, bonds, or other securities overseas and their subsequent listing (including planned listings, the same applies hereinafter).

Audit services related to mainland Chinese enterprises directly or indirectly issuing stocks, bonds, or other securities overseas and listing them are not within the scope of temporary practice. Overseas accounting firms are prohibited from entering the country and performing such services through temporary practice arrangements.

For enterprises established in mainland China in accordance with the law and directly or indirectly held by investors from the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and Taiwan region, with shares, equity interests, property shares, voting rights, or other similar rights accounting for more than 50 percent, the interim regulations do not apply to their overseas listing audits.

Article 3   Chinese mainland enterprises may, in accordance with the law, independently choose accounting firms—either from within China’s mainland or overseas—that comply with the listing jurisdiction’s regulatory frameworks and requirements to provide audit services for their overseas listings.

Article 4   Accounting firms from mainland China that have been approved by overseas regulatory authorities and authorized to provide audit services for the overseas listing of enterprises from mainland China shall conduct relevant audit engagements in compliance with applicable laws, regulations, and professional standards.

Article 5   If a mainland Chinese enterprise legally entrusts an overseas accounting firm to conduct an audit, the entrusted overseas accounting firm shall engage in business cooperation with a mainland Chinese accounting firm. The two parties shall sign a written agreement on business cooperation, independently negotiating and agreeing on the division of tasks as well as their respective rights and obligations. In particular, the audit working papers generated within China shall be stored by the mainland Chinese accounting firm within China.

Article 6   Foreign accounting firms entrusted with conducting audit engagements for mainland Chinese enterprises seeking overseas listings shall, as a priority, collaborate with firms established in mainland China in accordance with the law, possessing experience in auditing financial reports for initial public offerings or in auditing annual financial reports after listing, demonstrating high professional standards and strong ethical conduct, and having recently... 3 Has not had its practice suspended this year due to professional conduct. 6 Accounting firms organized as partnerships (including special general partnerships) that have received administrative penalties for more than one month may engage in business cooperation.

The entrusted foreign accounting firm shall assume audit responsibilities in accordance with the law.

Article 7   Accounting firms from the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and Taiwan that are entrusted with conducting audit engagements for mainland Chinese enterprises seeking overseas listings shall, as a priority, collaborate with firms established in mainland China in accordance with the law and possessing... 25 More than [number] certified public accountants registered in China, with excellent practice quality and professional ethics, and recently... 3 Has not had its practice suspended this year due to professional conduct. 6 Accounting firms that have received administrative penalties for more than one month are prohibited from engaging in business cooperation.

Accounting firms entrusted from the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and Taiwan region shall assume audit responsibilities in accordance with the law and, at the same time, enjoy leading rights—including the allocation of business assignments and the distribution of profits—in their business collaborations.

Article 8   Foreign accounting firms engaging in China For audit services related to overseas listings by mainland Chinese enterprises, At least prior to commencing the audit engagement upon entry, 7 Report to the provincial finance department where the Chinese mainland enterprise is located (see appendix for specific format). 1 ), and copy to the Ministry of Finance. Meanwhile, a copy of the audit engagement letter signed with the client company and a document related to China should be provided. Mainland China A copy of the written agreement for business cooperation signed by the accounting firm.

The overseas accounting firm failed to file the report in a timely manner. Or, if the reported information (including the audit engagement letter and the written agreement on business cooperation) is untrue or incomplete, the financial authorities at or above the provincial level shall... Issue a public notice, order rectification within a specified time limit, and forward the case to the relevant regulatory authorities in the country (or region) where the entity is located for handling; in cases of serious violations, issue a public announcement effective from the date of the announcement. 5 No audit engagements for overseas listings of mainland Chinese enterprises shall be undertaken this year.

If a foreign accounting firm fails to cooperate with an accounting firm in mainland China as required to conduct audit engagements or to retain audit working papers, By the financial departments at or above the provincial level Order to make corrections within a specified time limit; if the corrections are not made within the deadline and the practitioner continues to violate regulations, then... Financial departments at or above the provincial level To be announced, effective from the date of announcement. 5 No audit engagements for overseas listings of mainland Chinese enterprises shall be undertaken this year.

Article 9   Foreign accounting firm Engaging in audit services for overseas listings of mainland China enterprises. Yes, it should be after the business report date. 60 To China within the day Location of mainland enterprises Written report from the provincial finance department to China Mainland China The status of business cooperation undertaken by accounting firms (see appendix for specific format). 2 ), and copy to the Ministry of Finance.

If an overseas accounting firm fails to submit its report on time or submits inaccurate or incomplete information, the financial authorities at or above the provincial level shall take action. Issue a public notice, order rectification within a specified time limit, and forward the case to the relevant regulatory authorities in the country (or region) where the entity is located for handling; in cases of serious violations, issue a public announcement effective from the date of the announcement. 5 No audit engagements for overseas listings of mainland Chinese enterprises shall be undertaken this year.

Article 10   Accounting firms from mainland China engage in audit services for overseas listings of mainland Chinese enterprises. Yes, Each year, compliance with the “Provisional Measures for the Approval and Supervision of Accounting Firms” (Ministry of Finance Order No. [number]) shall be ensured. 24 According to the provisions of No. [number], report on the status of audit engagements for overseas listings of mainland Chinese enterprises conducted in the previous year. Specific requirements shall be in accordance with the Ministry of Finance’s regulations on annual reporting. If a report is submitted late or contains false or incomplete information, the provincial finance department in the locality will issue a public notice, order the entity to make corrections within a specified time limit, and designate it as a key regulatory target.

Article 11   If a mainland Chinese enterprise commissions an overseas accounting firm to provide audit services for overseas listings, it shall advise the overseas accounting firm to prioritize selecting a mainland Chinese accounting firm that meets the requirements set forth in Articles 6 through 7 of these Interim Provisions for business cooperation.

Article 12   Enterprises in mainland China and accounting firms providing audit services for their overseas listings shall strictly comply with the “Regulations on Strengthening Confidentiality and Archive Management Related to the Issuance of Securities and Listings Overseas” (China Securities Regulatory Commission). State Security Bureau National Archives Administration Announcement [ 2009 ] 29 Number).

If the overseas judicial authorities or regulatory agencies need to review audit working papers in connection with legal proceedings or other matters involving Chinese mainland enterprises’ overseas listings, or if overseas regulatory agencies need to review audit working papers in order to perform their regulatory functions, such reviews shall be conducted in accordance with the regulatory agreements reached between domestic and foreign regulatory authorities.

Article 13   The overseas accounting firms referred to in these Provisional Regulations include foreign accounting firms established in accordance with the law, accounting firms from the Hong Kong Special Administrative Region of China, accounting firms from the Macao Special Administrative Region of China, and accounting firms from the Taiwan region.

Article 14   These provisional regulations shall take effect from: 2015 Year 7 Moon 1 Effective from the date of issuance.

Attached :

1.     Information Filing Form for Overseas Accounting Firms Entering China to Perform Audit Services

2.     Report Form for Business Cooperation between Overseas Accounting Firms and Mainland China Accounting Firms