In July 1993, Tsingtao Brewery made history when it became the first mainland Chinese company to list on the Hong Kong stock exchange. China’s biggest beer company is now blazing a new trail.
In a move to cut costs, the group plans to dismiss its foreign auditors and rely solely on mainland Chinese auditors and accounting standards to prepare its financial statements, as reported in Wednesday’s FT. It’s a clear challenge to ongoing global efforts to harmonise those standards. Is this the start of a trend that investors should be worried about? It depends who you ask.
The Asian Corporate Governance Association, a lobby group for institutional investors, is concerned that Hong Kong regulators would not have oversight over mainland auditing firms, which are supervised by bodies such as the Ministry of Finance.