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U.S. SEC mandates foreign companies spell out ownership structure, disclose auditing certifications -Breaking


© Reuters. FILE PHOTO – The seal of U.S. Securities and Exchange Commission is seen in Washington D.C. U.S.A, May 12, 2021. REUTERS/Andrew Kelly

WASHINGTON, (Reuters) – U.S. listed foreign companies now must disclose whether or not they are controlled by a governmental organization and provide clarification evidence of auditing inspections certifications. This was announced Thursday by the Securities and Exchange Commission.

This measure was approved by five of the agency’s members. It aims to capture foreign companies that have been audited in jurisdictions where U.S. accounting watchdogs are prohibited from inspecting audit reports.

Additionally, the agency stated that its requirements clarify new Congress rules to address how variable interest entities (VIEs) are treated under law. It will provide a provisional identification of such companies, which will require additional disclosures for fifteen business days. Then the companies will have to present contradictory proof.

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