Discussion Questions:

(1) Are companies audited by Baker Tilly HK more prone to accounting fraud? What are the firm characteristics e.g. state-owned companies vs privately-owned enterprises? Are they from certain industries? Are they structured as offshore holding companies? Generate the list of Baker Tilly audit clients and do some analysis..

(2) Do different audit firms have different policy in their audit of related-party transactions of Asian/ Chinese companies?

(3) Why has US SEC struggled for years to obtain information for dozens of accounting fraud investigations at China-based companies?

http://www.bloomberg.com/news/print/2014-12-17/sec-fines-baker-tilly-hong-kong-for-missing-red-flags-in-china.html

SEC Fines Baker Tilly Hong Kong for Missing Red Flags in China

By Alan Katz – Dec 17, 2014

The U.S. Securities and Exchange Commission sanctioned audit firm Baker Tilly Hong Kong and suspended two of its employees for signing off on the financial statements of a China-based company accused of fraud. Continue reading →