PCAOB Sanctions Chinese Accounting Firm for Reporting Violations

The Public Company Accounting Oversight Board revoked the registration of a public accounting firm located in China for reporting failures and non-cooperation with the Board's investigation.

According to the Order, the firm failed: (i) to file Form APs ("Auditor Reporting of Certain Audit Participants") within the required timeframe after issuing audit reports; (ii) to timely file annual reports for the periods ending in 2021, 2022 and 2023; and (iii) to cooperate with the Division of Enforcement and Investigations. The PCAOB found that the firm failed to respond to the Board's demand for production of specific documents and information, despite receiving multiple notifications and extensions.

As a result, the PCAOB determined the firm violated PCAOB Rule 3211 ("Auditor Reporting of Certain Audit Participants"); Rule 2201 ("Time for Filing of Annual Report"); and Rule 5110 ("Noncooperation with an Investigation").

As a result of these violations, the PCAOB (i) revoked the firm's registration; (ii) censured the firm; and (iii) specified that if any misleading financial information provided by the firm to the Division is discovered, the PCAOB may impose a civil money penalty of up to $50,000.