8 October 2013


Dear members,

Inviting your views on regulatory framework for listed company audits

The Institute today issues an Information Paper and Request for Comment in relation to the regulatory framework for listed company audits in Hong Kong, following extensive discussion with the Government and the Financial Reporting Council.

Regulation of listed company auditors is an important aspect of the overall Hong Kong capital market. The Institute took an early lead back in 2008 and 2009 in identifying necessary reform, and later set up a committee and working group to develop proposals and submitted them to the Government.

The overall aim of the reform is to establish an independent body to exercise oversight over or assume direct responsibility for certain auditor regulation functions so that the Hong Kong system meets international benchmarks.

As such, a proposed framework for a revised regulatory system has been developed by the three parties. The Institute has also prepared an information paper, setting out the views of Council on the framework of key reform proposals, including preferred options and explaining the reasons why Council has reached these views.

Please visit this dedicated page: Regulatory framework for listed company audits on our website for the two papers and other details.

Please comment on the framework and confirm if you support Council's views. We would be pleased to hear from you if you have any additional arguments to support Council's views. If there are any aspects of the views expressed, the reasoning behind them or the framework itself that you do not agree with, please contact us with your thoughts. Please send them to regulation@hkicpa.org.hk.

We will publish responses on a named basis in the intended consultation conclusions. If you do not wish your name to be disclosed to members of the public, please state so when responding. Our policy on handling personal data is set out in http://www.hkicpa.org.hk/en/service-tools/personal-information.

This is the most important consultation for the profession in recent years and to fully engage members, we are organizing outreach lunch meetings with primary stakeholders, including firms that audit listed companies and practising certificate holders. We are also holding forums with specific groups of our members in the following months as well as with the general membership in the evenings of 18 and 28 October, and 20 and 27 November. Please watch for our communications for enrolment details.

On another important matter, professional liability reform, we continue to engage with the Government to explore if a form of liability limitation could be introduced in Hong Kong, as it has in many other jurisdictions. We will keep you informed of progress.

We look forward to your active participation in the consultation.

Best regards,

Raphael Ding
Chief Executive and Registrar