The Hong Kong Financial Reporting Council (FRC) has launched consultation on its plan to implement the expanded regulatory scope by the fourth quarter of this year. The plan also includes the renaming of the council to the Accounting and Financial Reporting Council. The expanded authority can deal with the registration of practice units and auditors of public interest entities and the issuance of practising certificates to registered accountants. It can also inspect practice units, investigate registered accountants and practising units, and discipline professionals. The new set of regulations carries the maximum fine of HKD10m or three times the profit gained or loss avoided, whichever is higher, for each act of misconduct. Auditors of unlisted entities are treated as “professionals” and are subject to a maximum fine of HKD500,000.
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