According to the U.S. Bureau of Labor Statistics, nearly 1.4 million accountants and auditors work in the United States. In 2017, the Internal Revenue Service (IRS) collected $3.4 trillion in taxes, paid $436 billion in tax refunds and audited $1.1 million tax returns.
These auditors help keep tabs on thousands and thousands of businesses across the nation, but their work also extends overseas.
When it comes to monitoring businesses domestically, the U.S. Exchange and Securities Commission brings hundreds of civil enforcement actions against both individuals and companies suspected of violating securities laws.
For three decades, the SEC has also been stepping up its cooperation with overseas regulators in countries such as China.
China is currently the United States’ largest trading partner with $578 billion in total (two-way) goods trade during 2016 alone. China is also the world’s largest economy in terms of purchasing power and is the largest foreign holder of U.S. Treasurys. In March 2018, China owned $1.19 trillion in Treasury’s, approximately 19 percent of the public debt held by foreign countries.
As a result of China taking on so much U.S. debt, corporate audit and assurance services are needed when the United States does business with China.
The U.S. investment management industry includes an estimated $66.8 trillion in capital. China is taking an increased interest in investment ventures worldwide including the United States through acquisitions, mergers and investments. As the global marketplace continues to grow, corporate audit and assurance services are becoming more and more important to help business get done in an orderly fashion.
As recently as February, the SEC blocked the sale of Chicago Stock Exchange to Chinese-based investors due to an inability to properly monitor the exchange. Even with such a large stake in the United States economy, China’s potential access to American markets makes some lawmakers nervous and also reinforces the need for corporate audit and assurance services.
That holds true internationally as well. Business advisory services in China, international tax and accountancy services for Chinese businesses and Chinese accounting firms also play a part in helping make international deals possible. SEC compliance audits in China could go a long toward furthering continued trade deals between the two nations.
