Hong Kong’s accounting regulator is sounding the alarm over a surge in auditor resignations a month before or after a company’s reporting period ends. So-called “late auditor resignations,” which increased to 107 during the nine months ended Aug. 31 from 71 in the same period a year earlier, can jeopardize audit quality, the Accounting and Financial Reporting Council said Thursday. Audit firm resignations, and changes in general, are rare in the U.S., where companies are not required to switch firms after a certain number of years. In March, Enterprise Development announced annual results for the period that ended in December audited by Hong Kong accounting firm BOFA CPA Ltd. “We are concerned that audit quality may be compromised by late auditor resignations because the incoming auditor will have limited time to plan and conduct a proper audit in order to meet the listed entity’s deadline to announce their audited results,” she added.

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