2022-03-10-普华永道-Cross-border_reviews_during_the_global_pandemic_4页_1mb

Summary of Forensic Bites Series: Cross-Border Reviews During Global Pandemic

Context

The COVID-19 pandemic has enforced travel and border restrictions globally, with China maintaining stringent limitations on跨境 travel and domestic measures. This has shifted audit and compliance work to remote methods, posing significant challenges for multinational companies (MNCs) with internal audit and compliance (IA&C) teams.

Challenges

Remote reviews are common due to travel restrictions, but they face issues like limited physical document access, which can lead to non-cooperation from local management. Language barriers and virtual communication exacerbate these problems, making it harder to assess control frameworks, compliance cultures, and detect fraud or other risks. New Chinese laws, such as the Data Security Law and Personal Information Protection Law, restrict cross-border data transfer, adding complexity to compliance reviews.

Solutions

To address these challenges, many MNCs are recruiting or increasing local IA&C personnel for on-site presence. This helps overcome language and cultural issues, ensuring better visibility and more efficient reviews. Alternatives include partnering with professional firms for remote or hybrid audits, enhancing whistleblower programs for early issue detection, and using third-party risk management tools for monitoring business partners.

Conclusion

China remains a critical market for MNCs; adapting by investing in local resources, technology, and partnerships is essential to mitigate pandemic-related challenges amid uncertain border conditions.