Hong Kong watchdogs expand financial reporting and audit oversight to licensed virtual asset service providers

Hong Kong’s Accounting and Financial Reporting Council said on Sept. 28 that it has signed a new memorandum of understanding with the Securities and Futures Commission, widening the scope of regulatory cooperation between the two bodies. The arrangement now goes beyond oversight of financial reporting by listed entities and related audit work. It also covers the financial and compliance reporting of licensed corporations, SFC-licensed virtual asset service providers, SFC-authorized funds, and registered open-ended fund companies. In addition, the expanded framework applies to the related audit and assurance work carried out by their auditors. The announcement points to a broader coordination mechanism between the AFRC and the SFC across reporting and assurance matters involving more parts of Hong Kong’s regulated financial market, including the city’s licensed virtual asset service provider segment.