Xin Yuan Enterprises Group Limited announced that incumbent auditor RSM resigned on 31 March 2026 after failing to agree on a timetable for completing audits for FY 2024 and FY 2025. RSM’s departure stemmed from concerns that the draft independent investigation report into previously disclosed allegations did not provide sufficient scope or methodology to address all relevant issues.
The board, on Audit Committee recommendation, is seeking shareholder approval at an extraordinary general meeting to appoint Prism Hong Kong as the replacement auditor. Prism’s final engagement is contingent on completing independence and conflict checks.
Key considerations behind the proposed appointment include:
• Independence and compliance: Prism Hong Kong is a registered Public Interest Entity auditor under Hong Kong’s Accounting and Financial Reporting Council Ordinance and adheres to the HKICPA Code of Ethics. • Resources and expertise: The firm operates three offices across Hong Kong and Mainland China with more than 50 qualified accountants. The engagement team will comprise an experienced partner, an engagement quality control partner, and eight additional audit professionals. • Audit timetable: A risk-based audit plan targets (1) planning meetings in early–mid April 2026, (2) field work from late April to mid-June 2026, and (3) completion of FY 2024 and FY 2025 results announcements by June 2026. • Fee and capacity: After reviewing proposals from three firms, the Audit Committee determined Prism’s fee, manpower and prior experience with Hong Kong-listed companies undergoing resumption processes to be “fair and reasonable.”
Prism has reviewed the draft investigation report and acknowledged RSM’s concerns, indicating additional forensic work or alternative procedures may be required to finalize the outstanding audits without compromising quality.
Trading in Xin Yuan Enterprises shares has been suspended since 21 February 2025 and will remain halted until the company satisfies resumption guidance. Shareholders and prospective investors are advised to exercise caution in dealing in the securities.