Hong Kong SFC Urges Strengthened Review of Listed Companies' Hasty Auditor Changes

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** Caixin News ** The Hong Kong Securities and Futures Commission (SFC) has published a review report regarding the Hong Kong Exchanges and Clearing Limited (HKEX) (00388.HK) and its performance in regulating listings in 2024. The report includes an in-depth assessment of HKEX’s review of internal controls of listed companies and its handling of auditors’ hasty resignations.

The SFC urges HKEX to strengthen its review of cases where listed companies hastily replace auditors and recommends that HKEX refer to the guidelines issued by the Hong Kong Institute of Certified Public Accountants (HKICPA) to revise its market guidance. This includes requiring listed companies to obtain shareholder approval before requesting auditors to resign. The HKICPA is the statutory independent regulator of the accounting profession in Hong Kong.

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