A bill that seeks to establish a Financial Reporting Council to investigate auditors' irregularities on listed corporations or collective investment schemes will be gazetted on June 17.

The council will also be empowered to enquire into non-compliance concerning financial reports of such listed entities. The bill will be introduced into the Legislative Council on June 29.

The Government said the proposal is of public interest and in line with international trends of upgrading the regulatory oversight of the accounting profession.

The bill aims to provide the council with sufficient powers to conduct investigations and enquiries effectively. It also puts in place a number of checks and balances to ensure the council performs its functions independently and fairly.

Bill details

According to the proposals, the council will act as an independent statutory body comprising, with a lay majority, not more than 11 members including an ex-officio member from the Government and other members to be appointed by the chief executive.

The council will be empowered, through the Audit Investigation Board, to carry out investigations into suspected irregularities concerning auditors of corporations and collective investment schemes listed in Hong Kong.

It will be given the power, through the financial reporting review committees, to enquire into suspected non-compliance with relevant legal and accounting requirements of the accounts and financial reports of listed corporations and collective investment schemes.