Two Authorities Strengthen Audit Report Verification and Enhance Service Management for Specialized, Sophisticated, Distinctive and Innovative "Little Giant" Enterprises
Recently, the Ministry of Finance (MOF) and the Ministry of Industry and Information Technology (MIIT) have jointly released the Circular on Strengthening Audit Report Verification and Enhancing the Service Management for Specialized, Sophisticated, Distinctive, and Innovative "Little Giant" Enterprises (the "Circular"), effective from the date of release.
The Circular proposes strengthening the informatization efforts in regulating the certified public accountant (CPA) industry, expanding the application of audit report verification codes, fully leveraging the unified regulatory platform for the CPA industry, and cracking down on misconduct, such as illegal entities issuing false audit reports in the name of accounting firms, or some accounting firms issuing multiple audit reports for the same audit matter. The Circular emphasizes a stringent review of application materials from specialized, sophisticated, distinctive, and innovative "Little Giant" enterprises, integrating audit report verification throughout the entire process of identification, management, and service provision for these enterprises. Furthermore, the Circular specifies SMEs participating in the recognition as specialized, sophisticated, distinctive, and innovative "Little Giant" enterprises, along with these enterprises themselves, should ensure accounting firms promptly submit audit reports to the unified regulatory platform and apply for verification codes during annual report audits and other audit activities.