The Forgotten Risks – Investing in US-listed Chinese Company
A publicly listed company as the name suggests is a company that is traded and owned publicly. By law, public companies must be audited each year by independent auditors with the U.S. Generally Accepted Accounting Principles (GAAP) or IFRS. This process gives public investors confidence and is fundamental in any investment process. As an investor one of the worst things that could happen is fraud – remember Enron and WorldCom accounting scandals? Because of that, the Sarbanes-Oxley Act was born and the Public Company Accounting Oversight Board (PCAOB) was created to serve as the industry’s watchman, auditing the auditors.
