China-US standoff may help Hong Kong auditors in lobbying efforts

Hong Kong auditors could benefit from a stand-off between Beijing and Washington that prompted mainland regulators to draw up plans to ban foreign accountants from scrutinising the books of listed Chinese companies on national security grounds, say industry players.

Finance officials from Hong Kong are lobbying Beijing for an exemption from the proposed rules that would require one of the 100 mainland accounting firms to lead the audit of any Chinese firm listing overseas. Their overseas partner accounting firms would be responsible for signing the books but would not be allowed to send staff to the mainland for audit work under the new rules, triggering fears of job losses for the city's auditors.

The Ministry of Finance has indicated special treatment for Hong Kong accountants could be possible as it would not "close the gate" on Hong Kong auditors and would be willing to listen to views from Hong Kong and Macau.

Secretary for Financial Services and the Treasury Chan Ka-keung, regulators and lawmakers from the accountancy sector will meet ministry officials in Beijing next week.

Susanna Chiu, former president of the Hong Kong Institute of Certified Public Accountants, said Beijing could consider an exemption under the Closer Economic Partnership Arrangement (Cepa) between Hong Kong and the mainland.

"It's an effective tool to allow Hong Kong-based accountants and other professionals to contribute to the country," she said.