Almost three months after placing the Chinese company Evergrande into compulsory liquidation, the Hong Kong authorities are now interested in the role that the British auditing giant Price-waterhouse-Coopers may have played. The Hong Kong regulator will open an investigation into the role of PwC in the accounting practices of the Chinese real estate giant accused by China of major fraud.
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First of all, Evergrande has an abysmal debt of 328 billion dollars. For years, the group present in 230 cities in China managed to conceal the extent of its difficulties through a game of sleight of hand: it included sales of apartments or real estate complexes in its accounts before they were sold. were actually delivered to their customers. In 2019 and 2020, this technique allowed him to artificially inflate his financial results and to borrow more easily on the markets, in fact digging his future grave even further.
However, it was PriceWaterHouseCoopers which carried out the audit of Evergrande until 2023, when the British multinational finally refused to approve the accounts of its Chinese client. Chinese authorities estimate the fraud at $78 billion.
Read alsoIn China, the president of Evergrande soon banned for life from the stock markets
What did PriceWaterHouseCoopers’ auditors and accountants really know? The Chinese authorities were already asking themselves the question. Now, following an “anonymous denunciation” which no independent media has been able to access, the authorities of Hong Kong – where the company was listed – are in turn opening a formal investigation.
Hong Kong, which had ordered the liquidation of the Chinese developer in Januaryhas just adopted a new national security law which further strengthens Beijing’s right to review its internal affairs, including economic ones.
Read alsoTightening of the repressive arsenal in Hong Kong with a new security law