The Public Company Accounting Oversight Board today settled a disciplinary order sanctioning a Chinese firm for repeatedly violating PCAOB rules and failing to cooperate with the board's investigation.
The PCAOB found that JTC Fair Song CPA Firm, located in Shenzhen, China, repeatedly failed to make required filings. First, the firm repeatedly failed to timely report the participants in its issuer audits on PCAOB Form AP, violating PCAOB Rule 3211, Auditor Reporting of Certain Audit Participants. Second, the firm failed to timely file its annual reports on PCAOB Form 2 in 2021, 2022 and 2023, violating Rule 2201, Time for Filing of Annual Report.
The firm also failed to cooperate with the PCAOB's Division of Enforcement and Investigations by refusing to produce documents and information.
"All registered firms must comply with PCAOB reporting requirements, which are designed to provide the PCAOB, investors and other stakeholders with important information," PCAOB chair Erica Williams said in a statement. "When firms don't comply, the PCAOB will use the tools at our disposal to hold them accountable to fulfill our investor-protector mission."
Without admitting or denying the findings, JTC Fair Song CPA Firm settled with the PCAOB and consented to a disciplinary order censuring the firm and revoking the firm's registration. The board accepted the firm's settlement offer, which does not require it to pay a civil money penalty. The PCAOB would have imposed a $50,000 penalty if it had not taken the firm's financial resources into consideration.
"Today's order should serve as a stark reminder that firms must cooperate with the Board's investigatory process," Robert Rice, director of the PCAOB's Division of Enforcement and Investigations, said in a statement. "Cooperation with the Board's processes is a bedrock principle under our rules and standards and is not optional."
