Revised Hong Kong Standard on Investment Circular Reporting Engagements 400 "Comfort Letters and Due Diligence Meetings"'

The revised Hong Kong Standard on Investment Circular Reporting Engagements 400 "Comfort Letters and Due Diligence Meetings" ("HKSIR 400") was published in October 2011. It comes to effective for comfort letters and due diligent meetings in respect of investment circulars dated on or after 1 January 2012. HKSIR 400 sets out the requirements and guidance for reporting accountants to issue comfort letter and other assistance to sponsors for their due diligent purpose. The main changes to this standard include: 1. it is more closely in line with international practices; 2. it clarifies to cover all offerings, equity and debt; 3. it allows the use of a limited assurance approach when reporting on subsequent changes in financial information; and 4. it provides more illustrative examples for reference. The adoption of HKSIR 400 will reduce the time and cost in discussing and negotiating the work to be performed and the wording in the letter.Therefore, we expect that this standard should have a wide acceptance in the market. Disclaimer: The publication contains information in summary form and is therefore intended for general guidance only. This publication is not intended as legal, accounting or other professional advice and should not be relied upon as such. If legal, accounting or other professional advice or expert assistance is required, the services of a competent professional should be sought. Neither Reanda Lau & Au Yeung Limited nor any related entity shall have any liability to any person or entity that relies on the information contained in this publication.