Saturday, 4 June 2022

Is it arrogance or inferiority to engage in ‘critical dialogue’ with China?: Global Times editorial

China US Illustration: Liu Rui/GT

The Chinese-language website of Deutsche Welle on Tuesday published a commentary entitled "Maintaining critical dialogue with China is more important than ever." The article is filled with clichés about so-called "human rights issues in Xinjiang," which are not worth reading. But the phrase "critical dialogue" in the headline is intriguing. It is in fact the main attitude of the US and other Western countries in communicating with non-Western nations in recent years.

This is, in most cases, an unconscious revelation of American and Western elites' inner feeling of superiority. But now they put it forward consciously and promote it as an "effective way" to deal with China. This cannot be explained simply by "pride and prejudice." They did not articulate it in the past, but Western countries have been practicing and enhancing the so-called critical dialogue with China. It has become an approach or even a weapon in the West's strategic game with China. In other words, they are trying to "lecture" China under the cover of "dialogue."

In global interactions, disagreements are common. It is also normal to express different views or even criticize without mincing words. However, equal dialogue cannot be based on the premise that some values are superior to others. It also cannot be only one party lecturing or accusing the other. The US and the West's "critical dialogue" is condescending, and the implied logic is that only they have the ability, qualification and power to determine right and wrong. This means that one party already claimed the moral high ground before the "dialogue" even begins, which dwarfs the development level and moral image of other countries.

Colonialism has long been discarded as something despicable, but Western-centric power structures and mentality have not disappeared completely. Colonialism has been subtly transplanted into various aspects, lurking in Western political language and communication methods. Some elites in the US and the West, with a strong sense of superiority on civilization, regard non-Western countries as candidates waiting for their "approval." With ideological pointers in their hands, they took to the podium to oversee exams, judge papers, and then grade them based on the "performance" of these countries to determine whether they passed the exam. As for the standard of scoring, it is drawn by the US and the West according to their own historical and social formations, and "Western-centrism" is the only correct answer in all the exams.

In their eyes, only the West is right, civilized and advanced, while those who differ from them are branded as "evil," barbaric and backward. They forcibly create a dichotomy between "civilization" and "barbarism." On this fictional premise, they attach moral labels on different practices of other countries, trying to dwarf them in image so that they can "attack others from a high position" as they wish. It is for this reason they recklessly fabricate the lie of "genocide" in Xinjiang, audaciously call for "punishing China" by various means, and frantically threaten to bomb China "back into the Stone Age."

Sometimes, arrogance is a kind of overbearingness; sometimes, it is also a kind of deep inferiority. In the face of the rise of emerging market countries, including China, and their own troubles, the US and other Western countries are becoming increasingly overwhelmed. Faced with the narrowing gap between them and emerging market countries, they have to rely on slogans of "human rights" and "democracy" to maintain their "absolute advantage." The reason why they are so sensitive to their position in the dialogue is that they are aware of the disappearance of the absolute advantage they used to have. As a result, they have to deliberately highlight their discourse power to maintain the obsolete power structure behind it, which has become a subconscious reaction.

Even in the fields of human rights and democracy, the US and the West are increasingly lagging behind, relying only on slogans, posturing and fist-pumping to show their "self-esteem," which is actually laughable to the rest of the world. The West's self-confidence is collapsing, as the democratization of international relations is increasingly popular and as developing countries' awareness of their rights is strengthening. Today, if someone still wants to engage in colonialism and ideological hegemony, or even imagines leading other countries by the nose like livestock, no country with national pride and a sense of independence will obey.

Returning to the "critical dialogue," China has never been afraid of criticism, but firmly opposes hegemony. Times have changed, and US and Western elites should learn to be equal and respectful. Dialogue is necessary, and we welcome "constructive dialogue," but we reject "critical dialogue." We would also like to remind that a condescending posture is dangerous, because the farther you are from the ground, the harder you may fall.

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Thursday, 2 June 2022

UK audit shake-up after spate of corporate failures; The two sides of the EY break-up

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The Big Four

Britain to shake up audit market after Carillion crash

Britain to shake up audit market after Carillion crash - Reuters

FILE PHOTO: A view of the London skyline shows the City of London financial district, seen from St Paul's Cathedral in London, Britain February 25, 2017. REUTERS/Neil Hall/File Photo/File PhotoReuters

UK Audit Shake-Up Targets Big Firms After Spate of Corporate Failures

LONDON (Reuters) - Britain set out sweeping reforms of big company audits on Tuesday after high-profile collapses at builder Carillion and retailer BHS in recent years hit thousands of jobs and raised questions about accounting quality.

The business ministry detailed changes to auditing and corporate governance that will be put into law, though the measures are unlikely to come into force until 2024 or later and smaller firms will be shielded from the new rules.

The reforms are in response to 150 recommendations from three government-sponsored reviews on improving auditing in a market dominated by KPMG, EY, PwC and Deloitte, known as the Big Four.

The new law would create a more powerful regulator, the Audit, Reporting and Governance Authority (ARGA), to push through changes set out by government.

In the meantime, the current watchdog, the Financial Reporting Council (FRC), will have powers to vet audit companies and ban failing auditors, the ministry said.

Britain will also review a European Union definition of "micro entities", which benefit from simplified accounts. They typically have a balance sheet of no more than 350,000 euros ($377,230) and employ no more than 10 people.

Loosening the definition would mean more firms saving money by filing simplified accounts, though it could raise investor protection concerns. Other reporting requirements will also be reviewed to help attract growth companies to Britain.

The FRC currently focuses on big listed companies, but ARGA's remit would expand to include about 600 private firms with more than 750 staff and an annual turnover of over 750 million pounds ($949 million), a higher threshold than initially flagged. BHS was unlisted.

NO UK SARBANES-OXLEY

To curtail the dominance of the Big Four, the top 350 listed companies would have to appoint a non-Big Four accountant, or allocate a certain portion of their audit to a smaller accountant such as Mazars, BDO or Grant Thornton.

The business ministry could introduce market share caps on the Big Four if there is no improvement in competition.

Directors of premium listed companies would also have to state why they think their internal controls are effective.

This would be done under Britain's "comply or explain" corporate governance code, which the FRC can change without legislation.

UK companies pushed back against enshrining in law a version of mandatory U.S. Sarbanes-Oxley rules, which force U.S. directors to personally attest to the adequacy of internal controls, and face prison for breaches.

"Lessons from Carillion and other recent company failures have been ignored, with little emphasis now on tightening internal controls and modernising corporate governance," said Michael Izza, chief executive of ICAEW, a professional accounting body.

FRC chief Jon Thompson said: "The Government’s decision not to pursue the introduction of a version of the Sarbanes-Oxley reporting regime is, the FRC believes, a missed opportunity to improve internal controls in a proportionate, UK-specific manner."

Big firms would also have to state what external checks, if any, were made on the reliability of their non-financial information in annual reports, such as risks from climate change.

Larger companies would have to confirm the legality of their dividends, a lesson from Carillion.

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Insight - The two sides of the EY break-up

For its part, EY is under particular pressure due to its auditing of collapsed German payments firm Wirecard AG – although it’s not clear that a break-up would rid it of any liabilities arising from that failure. Perhaps EY is preempting tougher regulation.Or perhaps it just sees an opportunity to monetise some of it assets.

A possible split of EY into separate audit and consulting firms must confront the problem faced by all break-ups: How do you create attractive businesses out of both when one is likely to be seen as inferior?

Here, that would be the newly established standalone auditor. EY – or any Big Four accounting firm that attempts such a separation – has its work cut out to make pure-play audit a success.

The revelation by Michael West Media that EY is considering the move heralds a potentially seismic shift for the industry.

A succession of accounting scandals has long prompted attacks on the Big Four for earning fees from audit clients by selling consulting services such as strategy or restructuring advice.

There’s an inherent conflict of interest in offering these to the same executives whose homework you’re meant to be marking.

While regulatory scrutiny is forcing firms to tread carefully, creating distinct companies is the most reliable remedy.

The United Kingdom’s competition watchdog called for an “operational separation” of audit and consulting within the existing firms in 2019, stopping short of demanding full break-ups because of cost and complexity.

Perhaps EY is preempting tougher regulation.

Or perhaps it just sees an opportunity to monetise some of it assets.

One option under consideration is the sale of a stake in the consulting business to a private buyer or to the stock market, creating a windfall for EY’s current partners, according to the Financial Times. Demand would likely be strong.

Just look at the private-equity money piling in lately. PwC sold a tax advisory practice to Clayton, Dubilier & Rice for a reported US$2.2bil (RM9.6bil) last year, while KPMG offloaded its UK restructuring arm to HIG Capital LLC.

But what about the rump that remains?

While the underlying economics of the Big Four are opaque, there’s a widespread suspicion that consulting subsidises audit.

At the very least, the ability to share costs means audit fees are lower than they would be for a distinct firm, regulators have found.

Retaining talent

The biggest challenge is how a standalone auditor would attract and retain talent without offering an in-house career in consulting as an option.

Short-sellers and forensic investigators aside, checking company accounts is for many a laborious gateway to other roles.

Audit partners accused of getting it wrong have regulatory probes hanging over them for years (an investigation into Rolls-Royce Holdings Plc’s 2010 accounts only just closed).

No wonder juniors tend to jump ship to better paid and less risky careers in consulting or investment banking not long after they’re qualified.

So auditing will have to be made more attractive, both financially and culturally.

One place to start is expanding the function beyond checking financial statements to offering sophisticated checks on companies’ claims on non-financial performance such as climate and social impact.

When the United States Securities and Exchange Commission is clamping down on greenwashing by investment funds, it’s clear the future of environmental, social and governance investing rests on companies proving they’re not cooking the books on these issues too.

These public-interest assessments are going to be increasingly scrutinised by investors in future.

They are already offered under the umbrella of so-called assurance services, but ought to become a more developed part of corporate reporting.

That would involve transferring some skills over from the consultancy side. The trick will be to add in parts of the current consulting business that are relevant to a more modern vision of audit, without just recreating a new auditor-cum-consultancy.

Of course, separation won’t eliminate all the conflicts in audit.

The chief culprit is the way managers often effectively appoint the audit partners who are meant to be their policemen.

But the prize for stock-market investors is improved audit quality, and a break-up could support that.

The goal should be to create a virtuous circle.

Make audit more enticing as a long-term career, attract people who do the work better – and hopefully cut the number of blow-ups. — Bloomberg

Chris Hughes is a Bloomberg Opinion columnist covering deals. The views expressed here are the writer’s own.

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Ex-property agent in S’pore fined record S$1.16mil for illegally subletting private homes on Airbnb, HomeAway

Simon Chan Chai Wan paid his accomplice Zhao Jing a monthly salary of $4,000 for helping him. PHOTOS: SGP BUSINESS

Chan had illegally rented residential properties such as Caribbean at Keppel Bay (pictured). — The Straits Times/ANN

A 57-YEAR-OLD man was fined a record S$1,158,000 (RM3.7mil) for offences related to unauthorised short-term accommodation.

Simon Chan Chai Wan had illegally provided short-term rents in 14 private residential properties to local and foreign guests through platforms such as Airbnb and HomeAway.

His accomplice Zhao Jing, 43, was fined S$84,000 (RM268,000) for aiding him in carrying out the offences.

The properties included units in International Plaza, Robinson Suites, Claremont, Centrepoint Apartments, The Abode at Devonshire and Caribbean at Keppel Bay.

Zhao and Chan, who are a couple, were licensed real estate agents at the time of the offences, court documents said.

They were the directors of two companies, HTM Solutions and HTM Management, and Chan is the former director of SNS Infotech Global.

Chan would enter into tenancy agreements with the units’ owners using the three companies as corporate vehicles, and sublet the units for short-term accommodations on the platforms.

Chan had also persuaded Zhao to be the sole tenant for four of the units.

From June 30, 2017, to July 2018, Chan’s total revenue was S$1,254,907.78 (RM4mil).

He paid Zhao a monthly salary of S$4,000 (RM12,000) for helping him. Zhao would have received S$52,000 (RM166,000) for the period of the offences.

The Urban Redevelopment Authority said in a statement that all private residential properties rented out for accommodation are subject to a minimum stay of three consecutive months.

"Property owners should also exercise due diligence to ensure that their properties are not used by their tenants for unauthorised purposes," it said.

“Unauthorised short-term accommodation not only changes the residential character of a property, but also causes disamenities to neighbouring residents.” — The Straits Times/ANN

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Tuesday, 31 May 2022

UN High Commissioner for Human Rights (OHCHR) should investigate US shootings

America's lucrative gun business Cartoon: Carlos Latuff

US President Joe Biden and first lady Jill Biden visited the Texan town of Uvalde on Sunday, laying a bouquet for the 21 victims, including 19 children, in the latest mass shooting. The grief that this school tragedy brought to American society is far from dissipating. Only 12 days ago, the Bidens were at the site of another mass shooting - a supermarket in Buffalo, New York - to mourn the 10 victims. Just in the past weekend, there were multiple shootings across the US, killing at least six people and injuring more than 30 others.

Public anger is growing as more details of the Robb Elementary School shooting are revealed. According to reports, as many as 19 police officers stood in a hallway outside the classroom where the gunman was hiding for nearly an hour before they opened the door. One of the young victims bled to death while waiting for police to come, media reported. The New York Times released an opinion piece titled "Don't Talk to Me About 'Civility.' On Tuesday Morning Those Children Were Alive," denouncing the hypocrisy of the so-called "civility" hyped by the American elites. Biden also asked: "These kinds of mass shootings rarely happen anywhere else in the world. Why are we willing to live with this carnage? Why do we keep letting this happen?"

But in a country that prides itself on being a "beacon of light," the clamor of public opinion as well as the condemnation from celebrities and politicians are not enough for the US system to reform its gun laws. The number of shootings in the US is increasing, like black ants gathering around rotting flesh. 2022 is not even halfway over, and more than 17,000 Americans, including 650 children, have already died from gun violence. Some Western media believe that US society has become "numb" in one shooting incident after another. Living a normal life after the gunfire should be called "American characteristics." And the American people can only dodge the bullets that come at any time by luck.

Such tragedies are exacerbated by the division of American politics. One can see that "rituals" are replacing real reflection as the standard procedure for each tragic incident. Flags were lowered at half-mast when a million Americans died due to epidemic control failure. The flags were lowered for the slow search and rescue of people trapped in collapsed houses, and for the mass casualties by shootings.

After the president and politicians made mournful rhetoric, saying "enough" and calling for "change," and gun ownership showed "a glimpse of regret" at charity dinners, the country can move on. Then the two parties will put their own spin on it. These tragedies have turned into weapons against opponents in a partisan struggle. When it comes to the problem itself, it has become a ball to be kicked around.

In addition to the weak gun control, the shootings also reflect the intensification of various social contradictions in the US, such as the wealth gap, racial discrimination, drug abuse, and public security. The US system is equally incapable, or lacks interest, motivation, and courage, to address these problems thoroughly. Behind the opposition to gun control are powerful interest groups and the inertia of the traditional understanding of guns in US society. The huge influence of the National Rifle Association (NRA) in American politics daunts every politician. People's rights are always giving way to political interests or "political correctness." This is the inherent logic of the US system.

It is worth noting that when the US' internal problems have become increasingly prominent, it has intensified its external aggression, which is a vicious circle at another level. US Vice President Kamala Harris on Saturday spoke at a memorial service for Ruth Whitfield, a victim of the Buffalo supermarket shooting, that the US "is experiencing an epidemic of hate." Another fact that she was reluctant and inconvenient to say is that the US is undergoing "an epidemic of hostility" externally. In recent days, Washington was still obsessed with fabricating a lie of the century over "the human rights in Xinjiang" and has been recklessly attacking and smearing UN High Commissioner for Human Rights Michelle Bachelet's visit to China. They probably did not expect Bachelet to reserve her longest answer for the US shootings and the racism at the press conference at the end of her visit. She said that "people believe that they are superior to others and feel they have the right to kill other people, but they are not."

Facts have proven once again that the "darkness under the lights," including the shooting cases, is a chronic human rights disease that the US, the so-called "beacon of light," neither dares nor is willing to illuminate. To solve this problem, one cannot rely on self-touching "ceremonies," or use "human rights" as a weapon to attack other countries. We urge the US government to take concrete actions to solve its own severe human rights problems, and stop being a negative example of double standards in terms of human rights. We call on the Office of the UN High Commissioner for Human Rights (OHCHR) to launch an investigation into human rights problems in the US as soon as possible, so that the US-style hegemony cannot cover up its bad deeds.

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June H.L. Wong

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By trying to pressure Bachelet, the US and West are unable to create an ‘iron curtain’ of human rights: Global Times editorial

Michelle Bachelet Photo: Courtesy of Embassy of Chile in Beijing

Michelle Bachelet, the UN High Commissioner for Human Rights, wrapped up her six-day visit to China on Saturday. This is the first visit by a UN high commissioner for human rights in 17 years. On Saturday night, Bachelet briefed reporters about her visit online, saying, "The visit was an opportunity to hold direct discussions - with China's most senior leaders - on human rights, to listen to each other" and "poverty alleviation as well as the eradication of extreme poverty, 10 years ahead of its target date, are tremendous achievements of China."

Regarding Xinjiang-related topics that have attracted much attention from the outside world, Bachelet visited Kashi, Urumqi and other places, walked into the cotton fields, and watched an exhibition on the theme of anti-terrorism and de-radicalization. During her Xinjiang visit, she also had discussions and exchanges with people from all walks of life such as ethnic minorities, experts and scholars. At the press conference, Bachelet specifically pointed out that her talks were conducted without supervision.

This development euphemistically responds to the conspiracy theories that have been deliberately created by US and Western public opinion for quite some time. Before Bachelet's visit to China began, the US, the UK and other countries threw out "questions" based on the presumption of guilt, asserting that the high commissioner's visit was "a mistake." After Bachelet honestly and objectively told the press conference her experience and details of her stay in China, some stubborn Westerners still turned a blind eye to all this. The US State Department even takes the lead by expressing its "concerns" and its feeling of being "troubled," and it accused China of restricting and manipulating Bachelet's visit. It also put forward its previous tailor-made lies about Xinjiang region again.

It is noticed that at first, it was the US-led Western countries that had kept pushing Bachelet to visit China, and now they have made a turnabout to attack Bachelet for no reason. Their ulterior political purpose is becoming more and more explicit.

In previous years, Xinjiang region was deeply affected by terrorism and religious extremism. But China has cracked down on terrorist activities in accordance with the law, safeguarded the lives and properties of people of all ethnic groups in Xinjiang, and effectively protected their human rights. After unremitting efforts, Xinjiang has become free of violent terrorism for more than five years in a row, with social security and stability, development continuing to improve, and people living and working in peace and happiness. However, some people in the US and the West stubbornly refuse to believe the reality in Xinjiang, and insist on imagining Xinjiang as a big theater with 25 million "extras," which is an insult to the intelligence of those who have seen the reality of the region.

Realities have proven time and again that the "iron curtain of human rights" created by those extremist forces trying to exploit the Xinjiang-related affairs is vulnerable. In recent years, the US-led West made up the so-called missing person list, and by invoking the rhetoric of "concentration camps" and other historical memories of the people of Western countries, they had forcibly imposed the labels of "genocide" and "forced labor" on Xinjiang. The more exaggerated their lies, the easier they will be exposed. Actually, anyone who has been to Xinjiang can see the absurdity of the US and the West in demonizing the region.

People attend a culture and tourism festival themed on Dolan and Qiuci culture in Awat County of Aksu Prefecture, northwest China's Xinjiang Uygur Autonomous region, Oct. 25, 2019. The festival kicked off recently in Aksu Prefecture. (Xinhua/Sadat)

It should be said that by visiting China under the pressure of the US and Western forces, Bachelet showed her efforts to learn the truth beyond the Western public opinion poisoned by these extremist forces. As Chinese State Councilor and Foreign Minister Wang Yi said that the high commissioner for human rights' trip to China would help enhance understanding and cooperation and clarify misinformation. We also expect that Bachelet would bring her comprehensive experience of a true Xinjiang to more people in the West who are willing to know the truth.

Of course, some people who pretend to be asleep may never be waken up. While Bachelet's visit was still underway, some so-called anonymous senior diplomats told media that the visit "is a victory to China." As human rights progress is endless, how can it be said to win or lose? Such rhetoric just reveals the genuine intent of the US and the West, which is to regard the normal exchanges and interactions between the UN high commissioner for human rights and China as part of a geopolitical game. They are trying so hard to "convict" China. As to the real situation in Xinjiang region, it doesn't matter to them at all.

It's precisely because of this that they must conduct an "investigation" on China with the presumption of guilt - whoever draws the conclusion of "genocide" and "forced labor" is "reliable." Such presumption of guilt is almost insane. In their eyes, a lunatic who claims that "people will be cut off their hands and feet when they arrive in Xinjiang," and "people will be shot dead if they refuse to eat pork" may appear to be "more credible" than the UN human rights chief. It has to be said that in order to smear and attack China, some people in the US and West have already broken the bottom line of common sense in their evil narratives against Xinjiang.

China's progress itself is a mirror. This is also true in the field of human rights. Bachelet's visit to China once again sends a message to the US and Western forces who engage in the manipulation of "using Xinjiang to contain China": Dark clouds cannot cover the sun and will only make people more appreciate the blue sky behind them.

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