As of late, some huge SEC compliance audits in China are attracting mainstream news headlines and more. Therefore, more and more people are trying to determine just what the SEC is and what it does. Therefore, it is wise to take some time to try and understand what this group can do in terms of businesses and their money. SEC stands for Securities and Exchange Commision and their work is really important, here is why:
The Internal Revenue Service is an organization that so many people fear and potentially loathe as well. Due to the fact that the IRS deals with taxes, Americans most often dislike this organization and their work. However, the IRS is a huge deal because they work to keep large-scale businesses as honest as possible.
In the year of 2017, reports have revealed that the IRS managed to collect nearly $3.4 million in terms of taxes. Also, they managed to audit nearly 1 million different tax returns and paid out nearly $436 billion in refunds. As a result, people should be aware of the IRS and the SEC compliance audits in China!
Audits and Regulations Are Really Important
In 2017, the IRS revealed that small businesses with a balance sheet return less than $10 million had to deal with an IRS audit rate of just about 0.7%. This is a solid return rate and these audits are going to potentially help business owners save money. Therefore, it is quite easy to understand just how important and helpful these types of audits can be. Especially when you understand SEC compliance audits in China.
IRS audits in 2017 mostly dealt with large entities. Therefore, people need to understand that the IRS is also important in helping keeping large-scale companies in check. A business that has balance sheets over $20 million had an audit rate of nearly 60%. However, individual taxpayers that reported less than $200,000 had an audit rate of less than 0.5%. So the IRS and SEC compliance audits in China are designed to protect the common person and not huge companies.
SEC Compliance Audits in China Are Not New
SEC compliance audits in China are more important than people think. First of all, accounting has been around for nearly thousands of years. Understand that accounting is traced back to ancient Mesopotamia, in which the first accountants in history worked to track taxes pain in sheep and produce. Therefore, this has long been used to monitor the actions of big, large-scale entities.
The Securities and Exchange Commision is primarily responsible for enforcing federal securities laws, creating new rules, monitoring the securities industry, stocks, and exchanges as well as random actions. Therefore, it can prevent shady activity that can take place within large entities that use their taxes to cover up dangerous and unlawful activity.
The SEC will bring forth hundreds of civil enforcement actions every single year. These actions are brought forth against both individual and companies that are suspected of violating securities laws and more. Therefore, it is easy to understand why their work is so important. This will prevent these types of big businesses from doing things that are unethical and more.
Chinese accounting firms are not necessarily evil in nature. However, they need to be monitored. This is why corporate audit and assurance services, international tax and accountancy services for China, and international tax and accountancy services for Chinese businesses are all so important. Keep in mind that according to the United States Bureau of Labor Statistics, about 1,397,700 accountants and auditors work in the United States.
In Conclusion
For three decades, the SEC has been stepping up its cooperation with overseas regulators in countries such as Hong Kong. Every single year the SEC brings hundreds of civil enforcement actions against both individuals and companies suspected of violating securities laws. Therefore, the work of Securities and Exchange Commision and SEC compliance audits in China are a huge deal!