Hong Kong’s accountant body said it failed to reach an accord to prolong an 11-year mutual recognition agreement with the U.S. amid a dispute over local qualifications.
The accord will expire at the end of this year, the Hong Kong Institute of Certified Public Accountants said in a statement. The agreement was last renewed in 2020 and allows certified accountants in the Asian financial hub and the U.S. to practice in each other’s markets.
The HKICPA and the U.S. International Qualifications Appraisal Board agreed in 2011 that U.S. accountants should have one year of local experience in order to practice in Hong Kong. But over the past three years, the IQAB has been negotiating with Hong Kong, hoping to waive the requirement by recognizing audit experience in the US.
“This requirement for one year of local experience exists to ensure that overseas applicants are familiar with the local audit environment and relevant legal requirements in order to meet the necessary professional standards when performing audits in Hong Kong,” HKICPA said in a
The scuppered deal comes as China and the U.S. are seeking to end a decades-long impasse over access to audit background papers for Chinese firms listed in the U.S. The U.S. has also sanctioned a number of high-level Hong Kong officials, including incoming Chief Executive John Lee, over their roles in cracking down on pro-democracy activists in the Asian financial hub.
