Address:
1430 Broadway, New York, NY 10018
Tel: U.S. (212) 792 -4800
Website:
English: www.hrrllp.com
Mandarin: http://www.hrcpa.com/china/index.php
Contact: aschneider @ hrrllp.com
Embracing China
While other accounting firms are re-thinking or fleeing the sector of China-based, U.S. listed companies, New York-based Holtz Rubenstein Reminick LLP (HRR) is “long” on China, renewing its commitment to the region and ramping up its business development effort. If what has happened in the technology sector since the dot.com crash of the late 1990′s, it’s a smart move, because much like the Internet, China is not going away.
HRR’s China practice is spearheaded by Andrew Schneider and Lian Brandt. Schneider is well positioned for the job. He has an expertise in conducting audits of public companies, as well as SEC accounting and disclosure rules related to IPOs, mergers & acquisitions. Brandt, who is fluent in Mandarin, has focused on manufacturing, distribution, retail, real estate, construction, healthcare, staffing and education. When she joined HRR in 2006, her language skills were not of great import to the firm. But as happenstance and global economics would have it, it was a fortuitous hire. Paul Becht and Lily Hui are also on the China team and the firm has several other Mandarin-speaking accountants in its New York office who lend support.
International Presence
In regard to its auditing practice, HRR has a relationship with DFK International, which allows it to have a global reach. DFK is a 50-year-old non-profit making consortium of independent firms and does not itself practice in the field of accountancy, nor does it provide business advisory service. Each DFK member is an independent legal entity in its own country. DFK has affiliate firms in Beijing, Guangzhou, Shanghai, multiple firms in Hong Kong, and multiple firms in Singapore. HRR often works with the assistance of firms on the mainland, but works with Hong Kong-based Andrew Ma DFK (www.amdfk.com), because it has the most experience with U.S. listed companies.
Schneider clarifies the relationship between the firms it works with emphasizing that Holtz is responsible for the planning, supervision and execution of the audit work done in China. “We are not relying on our DFK firms on any other firms we may engage to assist us in the process,” he says. “We send our own senior manager and partner level people to the clients’ offices in the PRC to conduct field work and use the lower level staff from the Chinese firms for assistance.” He adds, though, that speaking with partner-level people at their DFK, or other PRC based audit firms, allows the Holtz team to better understand the business culture and business environment in the PRC.
The SAIC/SEC GAAP Fix
When asked about the problems stemming from the differences in Chinese SAIC and SEC GAAP accounting, Schneider is not optimistic. “I am not sure there is a fix to get the SAIC and SEC GAAP in line,” he says. “Clearly a move to IFRS standards throughout the world would be a large help. It seems to me that historically the SAIC filings had not been viewed as much more than an informational filing requirement in China while the actual tax filings by the PRC companies, which are not public record, were viewed in a much more serious nature.”
He does believe accounting practices in China are improving. “As more companies list on domestic exchanges and the U.S. markets reopen to Chinese entities, investors will demand accountability, strong internal controls and quality work from the professionals working with these companies,” he says.
More Than an Audit Firm
In addition to offering accounting, auditing services, HRR is working with some larger Hong Kong and mainland China companies to help them establish subsidiaries or look for acquisitions in the U.S. The firm’s Wealth Management practice is also forging relationships with China-centric banks to attract Chinese national who are investing in the U.S.
(HRR is a member of CBK’s Professional Services Firm network. To find out how your firm can join, email: mwiebe@chinabusinessknowledge.com.)
