Hong Kong’s accountant physique stated it failed to achieve an accord to extend an 11-year mutual recognition settlement with the U.S. amid a dispute over native {qualifications}.
The accord will expire on the finish of this yr, the Hong Kong Institute of Licensed Public Accountants stated in an announcement. The settlement was final renewed in 2020 and permits licensed accountants within the Asian monetary hub and the U.S. to apply in one another’s markets.
The HKICPA and the U.S. Worldwide {Qualifications} Appraisal Board agreed in 2011 that U.S. accountants ought to have one yr of native expertise to be able to apply in Hong Kong. However over the previous three years, the IQAB has been negotiating with Hong Kong, hoping to waive the requirement by recognizing audit expertise within the US.
A promenade in entrance of town’s skyline in Hong Kong, China
Paul Yeung/Bloomberg
“This requirement for one yr of native expertise exists to make sure that abroad candidates are acquainted with the native audit setting and related authorized necessities to be able to meet the required skilled requirements when performing audits in Hong Kong,” HKICPA stated in an announcement. “On this relation, the Institute and IQAB couldn’t come to an settlement, and due to this fact couldn’t proceed on the renewal of the MRA.”
The scuppered deal comes as China and the U.S. are looking for to finish a decades-long deadlock over entry to audit background papers for Chinese language companies listed within the U.S. The U.S. has additionally sanctioned quite a few high-level Hong Kong officers, together with incoming Chief Govt John Lee, over their roles in cracking down on pro-democracy activists within the Asian monetary hub.