On June 26, the Standing Committee of the National People’s Congress voted to adopt the amendments to the Certified Public Accountants Law, which will take effect on January 1, 2027.

This amendment to the law is not just a minor tweak. Enacted in 1993 and slightly adjusted in 2014, this is the most sweeping revision in three decades—comprising a total of 27 changes, all aimed at a single target: audit fraud.

Three Key Changes:

The last provision is particularly noteworthy. In the past, companies that ”paid for an audit opinion” would, at most, simply switch to a different auditor. Under the new law, corporate entities and auditors who collude to fabricate financial statements will be penalized together. This amendment is not aimed at the auditing industry; it isTwo-Way Accountability Across the Entire Financial Fraud ChainThe

01 Why Is Cross-Border E-Commerce the Hardest-Hit Sector?

Accounting management for cross-border e-commerce is inherently three times more complex than that of traditional businesses. These three characteristics make sellers particularly prone to falling into the pitfalls of the new law:

Characteristic 1: Multiple platforms, multiple currencies, and multiple parties—inherent fragmentation of accounting records

A typical seller with annual revenue of 30 million: They receive payments in U.S. dollars on Amazon US, euros on Amazon Europe, yen on Amazon Japan, and multiple currencies on TikTok Shop in Southeast Asia. The funds are first deposited into a third-party payment platform, then transferred to a Hong Kong company account, and a portion is subsequently remitted back to mainland China. In between, there are also payments received via PayPal on their independent website and large offline B2B orders.

Turning this flow of funds into a complete, auditable set of accounts—in and of itself—requires professional expertise.

Characteristic 2: A Long History of Unresolved Issues—Past Irregularities Have Now Become Landmines

In the early days, many sellers followed this path: ”0110 customs declaration + payment collection through a Hong Kong shell company + funds repatriated to personal accounts.” On paper, the Hong Kong company consistently filed zero tax returns, while the mainland company reported only a portion of its revenue. Now that they’re catching up on their accounting—revenue doesn’t match the platform’s transaction records, costs lack compliant invoices, and the path of funds repatriation cannot be clearly explained.

When the auditors come to check, trouble is sure to arise as soon as they start looking.

Characteristic 3: The quality of service providers in the bookkeeping industry varies widely—“issuing reports” and ”ensuring compliance” are two different things

In the cross-border e-commerce bookkeeping market, there is a proliferation of low-cost services that ”only issue reports, without auditing or reconciling accounts.” While reports are issued, the data does not match the platform’s transaction records, customs declarations, or bank statements. In the past, auditors turned a blind eye to this, but under the new law, they no longer dare to do so—penalties apply not only to the firm but also to the auditor’s personal professional license.

02 What Changes Will Occur in Auditing After the New Law Takes Effect?

The new law will take effect on January 1, 2027, but the message is already very clear: auditors” attitude is shifting from ”helping you pass” to ”protecting themselves first.”

Three direct changes:

Change 1: Audit procedures will certainly be stricter

The new law explicitly prohibits ”issuing an audit opinion without maintaining professional skepticism or performing the necessary audit procedures.” In the past, some audit reports reached conclusions based on just three sets of working papers; going forward, auditors must, at a minimum: reconcile platform transaction records on a monthly basis, verify each related-party transaction individually, and perform two-way reconciliations of inventory and cash balances.

Change No. 2: Auditors Are No Longer Willing to ”Cover” for You

The combination of a lifetime ban from the profession and a personal fine of 2 million has made the professional risks for individual auditors outweigh the benefits of ”helping clients get through the process.” If you can’t provide a complete, verifiable set of audit working papers, the auditor may flat-out refuse to take on the engagement. It’s not that they’re unwilling to help you—it’s that they can’t afford the financial consequences.

Change 3: Problem reports will no longer simply indicate ”unable to process,” but will instead serve as leads for audits.

In the past, when an audit could not result in a report, the company and the auditor would negotiate a replacement. Under the new law, if an auditor discovers a material issue but the company fails to rectify it, the auditor may choose to report it to the regulatory authorities. For cross-border e-commerce, this means:The risk of accounting issues coming to light no longer comes solely from the tax authorities—it also comes from your auditor.

03: What Are the Five Things Companies Should Do During the Six-Month Grace Period?

There are six months from now until January 1, 2027. Ranked by priority:

First Task: Review historical financial records (highest priority; start immediately)

Export transaction data for the past 2–3 years from the backends of various platforms (Amazon, TikTok Shop, Shopee, and independent websites) and reconcile it month by month with the company’s reported revenue figures.

Second: Make sure you have all the required invoices (the sooner, the better)

The most critical problem for cross-border e-commerce isn’t a lack of profit; it’s ”making a profit but being unable to provide cost invoices.” Suppliers don’t issue invoices → costs aren’t recorded on the books → profits are artificially inflated → the business is deemed to have underreported its revenue.

Sign procurement contracts with key suppliers that include invoicing provisions, replacing the ”cost savings from not issuing invoices” with ”compliance through invoicing.” The additional tax cost is far less expensive than having to pay back taxes and penalties in the future.

Third: Hong Kong companies must ”truly” prepare their financial statements and undergo audits.”

Fourth: Choose the Right Bookkeeping Service Provider

How can you tell if an accounting firm can help you comply with the new law? Ask these three questions directly:

1. “Do you cross-check each transaction on the platform?” — If the answer is ”We’ll just use the data you provide,” that’s not good enough. A qualified bookkeeping service should proactively request your platform’s backend data to perform cross-checks.

2. “Do you perform inventory counts and reconciliations?” — Cross-border sellers’ inventory is held in FBA warehouses, overseas warehouses, and in transit; failing to reconcile inventory amounts to falsifying financial records.

3. “If there are discrepancies in historical data, how do you handle them?” — A professional team should have a plan for analyzing discrepancies and reconciling the accounts, not just say, ”Get the data consistent first, then give it to me.”

Number Five: Complete the ODI Filing

For a Hong Kong company and a Mainland entity, ODI filing is the most fundamental legal requirement. Without ODI filing, not only would it violate Order No. 837, but during an audit, the section on ”fund transfers between the Mainland entity and the Hong Kong company” would simply not hold up.

If you have any needs, please feel free to contact us:Add me on WeChat at qcygscszk or call 18676749275

04 If you don’t do it now, you won’t be able to make up for it later by ”doing a little more.”

The new law provides a six-month grace period, but given the complexity of cross-border e-commerce accounting, this is not something you can ”put off until the last month.”

For a seller with annual revenue of 30 million, the process—from organizing historical financial records to obtaining missing invoices to preparing a complete set of accounting and audit working papers—takes approximately 2–3 months. If issues arise along the way (such as missing historical data or suppliers refusing to issue invoices), the timeline becomes even tighter.

Six months is enough time to get your books in order. Six months is also enough time to ignore them—and then get caught out during the first audit after the new law takes effect.

The core logic of the new law isn’t ”to fine you a little more,” but rather ”if you commit fraud, you’re out.”

05 Are your accounts ready for an audit right now?

Five Self-Assessment Questions:

1. Has the Hong Kong company had its books fully audited for the past three years?

2. Do the platform’s total repayment amount and the total reported revenue match up on a month-by-month basis?

3. Are there valid accounting documents for advertising and logistics expenses incurred overseas?

4. Are the fund transfers between mainland and Hong Kong companies supported by contracts and business records?

5. Does the accounting firm you’re currently using focus on ”producing reports” or ”ensuring compliance”?

If you can’t answer any of these questions—you should have a professional team conduct a financial health check now, rather than waiting until the auditor shows up.

Qicaiying offers: Cross-border e-commerce bookkeeping services (monthly reconciliation of platform transaction records + inventory counts + multi-currency accounting) + annual audits for Hong Kong companies + accounting reconciliation and adjustment of historical discrepancies. We don’t just produce reports to fulfill formal requirements—we ensure your books meet the audit standards under the new regulations.

Add me on WeChat at qcygscszk or call 18676749275

Enterprise Finance Group

Founded in 2015 and headquartered in Shenzhen, Qicaiying Group is a leading provider of corporate services and tax compliance solutions in China.

The Group is deeply committed to providing services across the entire corporate lifecycle. Its core business areas include: business registration, bookkeeping services, tax compliance, overseas company registration (Hong Kong, the U.S., Singapore, Mexico, etc.), cross-border structuring, outbound direct investment (ODI) filing, overseas tax planning, bank account opening assistance, and identity planning.

Over the past decade, Qicaiying has served more than 10,000 corporate clients and has accumulated solid practical experience in key areas such as corporate structuring in Hong Kong and overseas, cross-border tax and financial compliance, and corporate accounting management. The Group boasts a team of seasoned financial and tax advisors who closely monitor changes in domestic and international tax systems and regulatory trends, providing clients with one-stop solutions ranging from structural planning to implementation.