Setback for IASs in China

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07 Mar 2002

The China Securities Regulatory Commission has reversed its decision [see Feb.

2002 News] that, for all initial and secondary public offerings of 'A Shares' (shares that can be purchased by Chinese investors), supplementary IAS financial statements must be published, and they must be audited by an international accounting firm. Under revised rules announced 1 March, supplementary audits will only be required if a company is issuing 300 million or more shares (a rarity). Further, in such cases the supplementary audits would be conducted by licensed Chinese accounting firms, not international firms, and only a reconciliation of net income to IAS would be required, not supplementary IAS financial statements. The Asian Wall Street Journal reported that "CSRC has succumbed to 'great pressure' from both domestic-listed companies and local accounting firms".

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