The Council of Institutional Investors has written to the SEC to raise concerns about plans to cut back on investor protections and accounting oversight. The full letter is below. An excerpt (footnotes omitted):
[We] respectfully request that the PCAOB investigate the matter to the extent possible and determine whether it is appropriate and in the interest of U.S. investors that Ernst & Young Hua Ming LLP remain a PCAOB-registered firm. Confidence in the auditor of Luckin Coffee Inc. will be even more critical in light of apparent control failures at the company, and it is not clear to us that the PCAOB can have confidence in processes of firms that it has not been permitted to inspect for more than a decade.
As you know, in 2010 the PCAOB stopped allowing firms to register from jurisdictions in which Ming LLP remain a PCAOB-registered firm.
will be even more critical in light of apparent control failures at the company, and it is not clear to us that the PCAOB can have confidence in processes of firms that it has not been permitted to inspect for more than a decade….While we understand that PCAOB investigations are non-public, please confirm that the Board remains committed to exercising its enforcement authority over all registered firms, even those located in jurisdictions where it cannot inspect, and will insist on timely cooperation in its investigations of all registered firms in the interest of protecting U.S. investors.
ValueEdge Advisors 