U.S.-China Audit Deal Faces First Test as Inspectors Head to Hong Kong

The historic deal follows a decades-long impasse between U.S. and Chinese regulators that put around 200 Chinese firms at risk of being delisted. Photo: Bloomberg

(Bloomberg) — After a decades long impasse that led to a threat to kick about 200 Chinese firms off New York stock exchanges, U.S. inspectors may soon get their first look under the hood of some of China’s largest corporations, if all goes as planned.

U.S. Public Company Accounting Oversight Board inspectors may arrive in Hong Kong as early as this week to start checking the audit working papers of U.S.-listed Chinese firms under a deal reached last month, according to people familiar with the matter. The PCAOB officials then have to decide whether they have gotten sufficient access to sign off on Chinese firms as compliant.