Beijing SinoHytec Co., Ltd. (SinoHytec) has replaced its outgoing auditor BDO with a joint team from Beijing Xinghua Certified Public Accountants and Beijing Xinghua Caplegend Certified Public Accountants for the financial year ending 31 December 2025.
The switch follows unsuccessful negotiations with BDO in October–November 2025. Key sticking points were: • A wider 2025 audit scope covering 12 additional subsidiaries. • A compressed audit timetable ahead of the company’s annual results announcement. • BDO’s indication that higher fees were necessary to deploy extra manpower and resources.
With no agreement on fees, BDO resigned on 27 November 2025. SinoHytec then launched a public tender under PRC regulatory requirements and selected the Beijing Xinghua firms, whose combined proposal totals HK$1.55 million.
Audit Committee assessment The committee cited six factors underpinning its recommendation: 1. Robust governance structures with experienced partners overseeing quality control. 2. Compliance with PRC and HKICPA ethical standards and confirmed independence. 3. Experience auditing more than 50 listed companies across multiple industries and exchanges. 4. Adequate staffing—15-member engagement team—and a clear three-phase audit timetable. 5. Structured, frequent communication with the Audit Committee. 6. No disciplinary records for either firm in the past three years.
Fee differential rationale Although the HK$1.55 million quote is slightly below BDO’s FY 2024 fee, the committee believes audit quality will not be compromised. Cost savings stem mainly from the auditors’ extensive domestic office network, which reduces travel time and expenses, while the audit scope, methodology and team size are comparable to those previously provided by BDO.
2025 audit plan Key focus areas include revenue recognition, accounts-receivable impairment and R&D expenditure classification. The audit is being conducted in three phases: planning and asset verification (already underway), substantive testing (January–early March 2026) and finalisation ahead of results disclosure (mid-March 2026). Opening balance procedures will also be performed given the first-year engagement.
The Board approved the appointment on 27 March 2026, emphasising that the new auditors possess the resources and independence required to deliver a timely, high-quality 2025 audit.
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