Paul Leder Quoted in the Wall Street Journal on SEC Rulemaking on Foreign Audits
"SEC Pursues Plan Requiring Chinese Firms to Use Auditors Overseen by U.S."
Wall Street Journal
Paul Leder, a former director of the U.S. Securities and Exchange Commission's (SEC) Office of International Affairs, was quoted in the Wall Street Journal regarding the current standoff between U.S. and Chinese authorities over the inspection of audit firms located in China. Currently those firms conduct audits of Chinese companies listed on U.S. exchanges but the Chinese authorities are not permitting inspections of those firms by the relevant U.S. authority, the Public Company Accounting Oversight Board (PCAOB). The SEC is expected to release a rule proposal in December, before Chairman Jay Clayton leaves the agency, to address the problem. In order to highlight the difficulty of resolving this particular conflict between the SEC and Chinese authorities, Leder asked, "[h]ow do you meet the U.S. goal which is an audit subject to a meaningful inspection, and what appears to be the Chinese goal of limiting the access to information held in China?"