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搜寻于 Revisions to the Definitions of Listed Entity and Public Interest Entity in the Code

Revisions to the Definitions of Listed Entity and Public Interest Entity in the Code

The following Questions and Answers (“Q&As”) are available in PDF format.

The Q&As below are prepared by staff at the Institute’s Standard Setting Department and approved by the Institute’s Ethics Committee. They do not necessarily reflect the views of the Standard Setting Department, the Institute, the Council or any of its committees. The Institute takes official positions only after extensive review, in accordance with the Institute's due process.

These Q&As should be read in conjunction with the Institute’s Revisions to the Definitions of Listed Entity and Public Interest Entity in the Code (“PIE Provisions”), its Basis for Conclusions, and other regulations, standards or guidance published and issued by the HKICPA.

The Q&As are intended for general guidance only. The Institute DOES NOT accept any responsibility or liability, and DISCLAIMS all responsibility and liability, in respect of the Q&As and any consequences that may arise from any person acting or refraining from action as a result of any materials in the Q&As.

The Standard Setting Department welcomes your comments and feedback, which should be sent to commentletters@hkicpa.org.hk.

Paragraph numbers in this document refer to Chapter A of the HKICPA Code of Ethics for Professional Accountants (“Code”), unless otherwise specified.

Q1.	Additional ethics and auditing requirements for audits of PIEs classified under the Code

Question:
What additional ethics and auditing requirements apply to auditors of an entity classified as a public interest entity (“PIE”) under the Code (“Ethics Code-PIE”)?

Answer:

(a) Additional independence requirements for Ethics Code-PIEs
When an entity is classified as an Ethics Code-PIE, additional independence requirements apply to their auditors when performing audits or reviews of the entity’s financial statements. These requirements reflect the significant public interest in the entity’s financial condition, considering the potential impact of its financial well-being on stakeholders. Key additional requirements¹ include:

(1) Prohibition on non-assurance services (“NAS”): Any NAS that might create a self-review threat in relation to the audit of the financial statements on which the

firm will express an opinion (Paragraph R600.17).
(2) Fee dependence: Additional requirements on fee dependency (Paragraph R410.28).
(3) Partner rotation: Rotation and cooling-off requirements for key audit partners of the engagement (Section 540, Chapter A of the Code).
(4) Transparency requirement: Firms must publicly disclose when they have applied the independence requirements for Ethics Code-PIEs to an audit or review

engagement (Paragraph R400.25).

The additional independence requirements in Part 4A, Chapter A of the Code apply only to audits or reviews of financial statements for entities classified as PIEs under the Code. Assurance engagements other than an audit or a review of financial statements (“Other Engagements”), such as those undertaken for regulatory reporting,² are subject to the independence requirements in Part 4B, as opposed to Part 4A, Chapter A of the Code. This means that the additional independence requirements of Part 4A are not applicable to Other Engagements, even if the entity is classified as a PIE under the Code.

(b) Differential auditing requirements: Applicable to PTEs only
In December 2025, the Hong Kong Standards on Auditing (“HKSAs”) have adopted the definition of “publicly traded entity” (“PTE”) from the Code to determine the applicability of certain differential requirements in audits or reviews of financial statement (“differential auditing requirements”).³ This amendment extends the differential auditing requirements—previously applicable only to listed entities—to all PTEs. The changes are effective for audits and reviews of financial statements for periods beginning on or after 15 December 2026.

As noted in Question 2, PTE is one of the categories within the broader definition of a PIE under the Code. Therefore, entities classified as PIEs under the Code that are not PTE (such as unlisted licensed banks and MPF schemes) are not subject to the differential auditing requirements in the HKSAs listed below.⁴

[4]

Differential auditing requirement applicable to PTEs under HKSAs	Relevant Paragraphs in HKSAs
Engagements subject to an engagement quality review	HKSQM 1, paragraphs 34(f), A133–A137
Communication with those charged with governance (“TCWG”) about the system of quality management	HKSQM 1, paragraphs 34(e), A127–A132
Communication with TCWG about auditor independence	HKSA 260 (Revised), paragraphs 18, 18A, A29–A32; HKSA 700 (Revised), paragraph 40(b)
Communicating key audit matters	HKSA 700 (Revised), paragraphs 30–31, 40(c), A41–A44; HKSA 701, paragraph 5
Transparency about other information	HKSA 720 (Revised), paragraphs 21–22(b), A12, A52
Going concern	HKSA 570 (Revised 2024), paragraphs 34(b), 35(b), A82, A89 and A101

Footnotes:
1	Further details are available in IESBA Summary of Prohibitions in the IESBA Code Applicable to Audits of PIEs
2	Examples of assurance engagements for regulatory reporting in Hong Kong that are not audits or review of financial statements can be found in paragraph 12 of Technical Bulletin (AATB 7) Determining the Appropriateness of the Auditor’s Reporting Framework – Assurance or Agreed-upon Procedures Engagements
3	See HKICPA Members’ Handbook Update No. 338 (December 2025): Narrow Scope Amendments to the HKSQMs, HKSAs and HKSRE 2400 (Revised) as a Result of the Revisions to the Definitions of Listed Entity and Public Interest Entity in the Code (“HKSA Narrow Scope Amendments”).
4	In addition to the differential auditing requirements, the HKSA Narrow Scope Amendments adds a new requirement to HKSRE 2400 (Revised) that if the relevant ethical requirements require the practitioner to publicly disclose that specific independence requirements for reviews of financial statements of certain entities were applied, the practitioner’s report shall include a statement that the practitioner is independent of the entity in accordance with the independence requirements applicable to reviews of financial statements of those entities.
5	HKSQM 1, Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements
6	HKSA 260 (Revised), Communication with Those Charged with Governance
7	HKSA 700 (Revised), Forming an Opinion and Reporting on Financial Statements
8	HKSA 701, Communicating Key Audit Matters in the Independent Auditor’s Report
9	HKSA 720 (Revised), The Auditor’s Responsibilities Relating to Other Information
10	HKSA 570 (Revised 2024), Going Concern

Q2.	Definition of a public interest entity

Question:

Paragraph R400.22 specifies four mandatory categories of PIE:

•	A PTE;
•	An entity one of whose main functions is to take deposits from the public;
•	An entity one of whose main functions is to provide insurance to the public; or
•	An entity specified as such by law, regulation or professional standards to meet the purpose described in paragraph 400.15.¹¹

Paragraph 400.23 A3 further specifies that taking into account the factors set out in paragraph 400.14, the purpose described in paragraph 400.15 and the broadly defined categories of public interest entities in paragraph R400.22, the following entities are PIEs under the Code:

•	For the purpose of paragraph R400.22(b), licensed banks, as defined under the Banking Ordinance (“BO”) except where there is no statutory requirement for audit to be performed;
•	For the purpose of paragraph R400.22(c), authorized insurers, as defined under the Insurance Ordinance (“IO”) except for (i) captive insurers; (ii) special purpose insurers; and (iii) insurers where there is no statutory requirement for audit to be performed;
•	For the purpose of paragraph R400.22(d), Mandatory Provident Fund Schemes, as registered under the Mandatory Provident Fund Schemes Ordinance; and
•	For the purpose of paragraph R400.22(d), Occupational Retirement Schemes, as registered under the Occupational Retirement Schemes Ordinance and are exempted under section 5 of the Mandatory Provident Fund Schemes Ordinance (“MPF-exempted ORSO registered schemes”) with total assets exceeding HK$100 million by reference to the most recent set of audited financial statements.

Paragraph 400.23 A3 is unique to Hong Kong in that there is no corresponding paragraph in the International Code of Ethics for Professional Accountants (including International Independence Standards) (“IESBA Code”) issued by the International Ethics Standards Board for Accountants (“IESBA”). Does this imply that the definition of a PIE may be applied differently under the Code compared with the IESBA Code?

Answer:

In developing the revised PIE definition in the IESBA Code, the IESBA recognized that it cannot provide refined specifications of the mandatory categories that would be globally applicable.

Instead, the IESBA determined to allow the relevant local bodies to more precisely define which entities should be included as PIEs under each of the three mandatory categories under paragraph R400.22(a)–(c), and to include additional entities as PIEs in their jurisdictions under paragraph R400.22(d). If the local body simply adopts the list of mandatory categories in paragraph R400.22 without due assessment, the local PIE definition may inadvertently scope in entities that do not have significant public interest in their financial condition.¹²[1]

Consequently, the Institute’s Ethics Committee has refined the definition of a PIE under the Code in paragraph R400.22(b), (c) and (d) by introducing a locally developed paragraph 400.23 A3, taking into account the unique facts and circumstances of Hong Kong. These local modifications to the PIE definition under the Code were the outcome of a rigorous process involving extensive consultations and thoughtful deliberation. The Basis for Conclusions summarizes the consideration of the Ethics Committee in reaching the conclusions in the PIE definition issued by the Institute.

Accordingly, the PIE definition under the Code in paragraph R400.22 should be read in conjunction with paragraph 400.23 A3. For instance, the PIE definition under paragraph R400.22(b) with regard to deposit-taking companies is refined through paragraph 400.23 A3, which are licensed banks defined under the BO except where there is no statutory requirement for audit to be performed. Under this definition, restricted licensed banks and deposit-taking companies licensed under the BO, as well as licensed banks where there is no statutory requirement for audit to be performed, are not PIEs in Chapter A of the Code.

Footnotes:

Paragraph 400.15, Chapter A of the Code: Stakeholders have heightened expectations regarding the independence of a firm performing an audit engagement for a public interest entity because of the significance of the public interest in the financial condition of the entity. The purpose of the requirements and application material for public interest entities as described in paragraph 400.13 is to meet these expectations, thereby enhancing stakeholders’ confidence in the entity’s financial statements that can be used when assessing the entity’s financial condition.

Question 11, Staff Questions & Answers, Revisions to the Definitions of Listed Entity and the Public Interest Entity of the Code (IESBA, (updated) September 2024)(“IESBA PIE Q&A”)

Q3.	Publicly traded entities

Question:

Paragraph R400.22 introduces a new compulsory PIE category for PTE, which replaces the previous PIE category of “listed entity”. What are the implications of this change for entities that are now regarded as PIE rather than as “listed entity”?

Prior to the PIE definition revision:

•	Listed Entity (definition): An entity whose shares, stock or debt are quoted or listed on a recognized stock exchange, or are marketed under the regulations of a recognized stock exchange or other equivalent body.

After the PIE definition revision

•	Publicly traded entity (definition): An entity that issues financial instruments that are transferrable and traded through a publicly accessible market mechanism, including through listing on a stock exchange.

A listed entity as defined by relevant securities law or regulation is an example of a publicly traded entity.

Answer:

The revised PIE definition replaces the definition of “listed entity” with a newly defined term, PTE. PTE is one of the mandatory categories of entities included in the revised PIE definition (see Question 2 above).

PTE encapsulates the term listed entity as an example defined by relevant securities law or regulation (rather than a standalone definition). On this basis a listed entity as defined by relevant securities law or regulation in the jurisdiction will meet the definition of a PTE, provided the other criteria of the definition are met and subject to any refinements to this category by relevant local bodies (e.g., making reference to specific public markets for trading securities).^{13, 14}

The term PTE is intended to scope in more entities. It covers not only issuers of shares, stock or debt (as currently referred to in the extant definition of “listed entity”) but also issuers of other types of instruments such as bonds, warrants and hybrid securities.¹⁵ It also encompasses those on second-tier markets or over-the-counter¹⁶ (“OTC”) trading platforms.

Under the PTE definition, if an entity issues financial instruments that are traded via a platform that is available to the public, including second-tier markets or OTC trading platforms, that entity should be scoped in as a PTE irrespective of whether the entity is a private company or public sector entity. For instance, a private company or public sector entity issuing bonds or other debt instruments that are traded on a local stock exchange or via the OTC market, and if the product is available to the public, the private company or public sector entity would be scoped in as a PTE for the purposes of the Code unless otherwise excluded as part of the local refinement of the PTE category.

In determining whether an entity is a PIE under the Code, it is not relevant how the financial instrument it issues is priced so long as it is transferrable and traded through a publicly accessible market mechanism. For example, a private company issuing warrants or hybrid securities that are traded on recognized exchanges with pricing tied to the share price of a third-party listed entity is a PIE under the revised definition. This scenario, covered by the first example in the table below, exemplifies a situation where the revised PIE definition would lead to an entity being classified as a PIE under the Code while it does not meet the PIE criteria prior to the revision.

The table below includes examples on how replacing the definition of “listed entity” with PTE would impact entities:¹⁷

Impact on Entities	Description	Example
The change would result in the entity being scoped in	Entities issuing financial instruments other than shares, stock or debt.	Entities issuing other types of instruments such as warrants or hybrid securities that are transferrable and traded through a publicly accessible market mechanism.
The change would result in the entity being scoped in	Entities issuing financial instruments that are traded in less regulated markets.	Entities issuing financial instruments traded on second-tier markets or OTC trading platforms.
The change would result in the entity being scoped out	Entities issuing financial instruments that are traded through a market mechanism that is not publicly accessible or when there is no facilitated trading platform such as an auction-based exchange or electronic exchange.	Privately negotiated agreements (with or without the assistance of a broker).

The IESBA has developed a publication, IESBA PIE Q&A, to support the implementation of the revised PIE definition. Questions 4 to 10 of the IESBA PIE Q&A discuss the definition of PTE and how to apply it in practice.

Professional Investors Regime in Hong Kong

In Hong Kong, the term “Professional Investors” (“PI”) is defined under the Securities and Futures Ordinance (“SFO”) and is divided into two groups. The first group comprises institutional professional investors specified by the SFO, while the second group includes individuals, corporations, trust corporations, and partnerships whose wealth meets certain thresholds.¹⁸

For the second group, PIs are defined based on wealth criteria. Individuals and corporations must have a minimum portfolio of HK$8 million, while corporations must have total assets of at least HK$40 million.

In Hong Kong, Special Purpose Acquisition Companies (“SPACs”) listed on the Main Board of the Stock Exchange of Hong Kong (“SEHK”) under Chapter 18B of the Listing Rules, as well as debt securities listed under Chapter 37 of the Main Board Listing Rules, are offered exclusively to PIs. These products are accessible to all types of PIs. There are no restrictions that would limit the subscription of a specific product solely to institutional PIs or a subclass of PIs. Accordingly, SPACs and the mentioned listed debt securities are considered being traded through a publicly accessible market mechanism within the revised PIE definition because they are open to all investor categories without any exclusions. Although a wealth criterion is applied for individual investors to qualify as PIs for subscribing to these products, this does not diminish the public availability of these products to all types of investors in the market.

In implementing the revised PIE definition under the Code, it is the responsibility of auditors to understand the characteristics of shares, debts, derivatives and other financial instruments issued by their audit clients, including the relevant trading mechanism, in order to determine whether an audit client meets the revised PIE definition.

Footnotes:
13	Question 4, IESBA PIE Q&A
14	The Institute’s PIE Provisions issued on 15 July 2024 did not introduce any local amendments or modifications to the definition of a PTE, keeping it consistent with the definition in the IESBA Code.
15	Question 5, IESBA PIE Q&A
16	According to the Report of the Steering Committee on Bond Market Development in Hong Kong (August 2022) published by the HKSAR Government, over 95% of the bond trading in Hong Kong during 2021 was conducted OTC. In addition, a factsheet on Hong Kong’s financial services published by the HKSAR Government in 2020 pointed out that there is an active OTC market in Hong Kong which is mainly operated and used by professional investors and trades swaps, forwards and options in relation to equities, interest rates and currencies.
17	Paragraph 26, Proposed Narrow Scope Amendments to the ISQMs; ISAs; and ISRE 2400 (Revised) as a Result of the Revisions to the Definitions of Listed Entity and PIE in the IESBA Code (International Auditing and Assurance Standards Board, January 2024)
18	Professional Investors, Investor and Financial Education Council
19	Qualification of professional investors, Investor and Financial Education Council

Q4.	Determining the PIE status of a MPF-exempted ORSO registered scheme

Question:

Paragraph 400.23 A3 specifies that for the purposes of paragraph R400.22(d), PIEs under the Code include MPF-exempted ORSO registered schemes with total assets exceeding HK$100 million by reference to the most recent set of audited financial statements.

Under the Code, will the PIE status of an MPF-exempted ORSO registered scheme change every year if its total assets fluctuate slightly around HK$100 million from year to year? For example, a scheme was a PIE under the Code in the previous year’s audit based on its total assets of HK$102 million in the audited financial statements two years ago, but its assets fell to HK$99 million in the financial statements audited last year which means that the scheme might not necessarily be a PIE under the Code for the current year’s audit.

Answer:

It is recommended that a firm continues to treat an MPF-exempted ORSO registered scheme as a PIE under the Code if its total assets in the most recent audited financial statements fell just below HK$100 million for the first time. Rather than immediately changing the scheme’s status from a PIE to a non-PIE, a firm is advised to observe for a longer period to determine whether the scheme’s total assets would be consistently below HK$100 million before making such a change. This will save the firm’s effort to prepare for the transition of the PIE status of an audit every year. Firms are also encouraged to develop policies to address such scenarios for consistent application across schemes.

It is important to note that once an entity is classified as a PIE under the Code, either by meeting the Code’s PIE definition or the firm’s policy, then all the provisions of the Code relevant to PIEs are applicable, including the non-assurance services (Section 600) and fees provisions (Section 410) in Part 4A, Chapter A of the Code. Similarly, the transparency requirement in paragraph R400.25 assumes that all the independence requirements for a PIE under the Code have been applied to the audit of the financial statements of such an entity.²⁰[1]

For an audit client classified as a PIE under the Code, once the firm determines that a NAS might create a self-review threat (by applying paragraph R600.15), the NAS is prohibited under paragraph R600.17.²¹Paragraphs R600.26 and 600.26 A1 provide requirements and guidance for a NAS provided to an audit client that later becomes a PIE under the Code.

Footnotes:
20	Question 19, IESBA PIE Q&A
21	The Staff Questions & Answers issued by the IESBA in January 2022 and July 2022 provide illustrations and examples on the application of the fees and revised NAS provisions of the Code, including those that are applicable to PIE audit clients.

Q5.	Entities that are highly interconnected with a PIE

Question:

Some entities that are classified as PIEs under paragraphs R400.22 and 400.23 A3 may be closely connected with the activities or operations of their subsidiaries or investee companies. In such cases, would those subsidiaries or investee companies also be categorized as PIEs under Chapter A of the Code?

Answer:

Engaging in business activities that have a significant interconnection with a PIE is not a factor or criterion in paragraphs 400.14, R400.22 or 400.23 A3 for classifying an entity as a PIE under the Code.

Under paragraph 400.24 A1, a firm is encouraged to determine whether to treat other entities as PIE for the purposes of Part 4A, Chapter A of the Code. When making this determination, the firm might consider factors outlined in paragraphs 400.14 and 400.24 A1:

PIE factors in paragraph 400.14

PIE factors in paragraph 400.24 A1

Factors to consider in evaluating the extent of public interest in the financial condition of an entity include:

The nature of the business or activities, such as taking on financial obligations to the public as part of the entity’s primary business.
Whether the entity is subject to regulatory supervision designed to provide confidence that the entity will meet its financial obligations.
Size of the entity.
The importance of the entity to the sector in which it operates including how easily replaceable it is in the event of financial failure.
Number and nature of stakeholders including investors, customers, creditors and employees.
The potential systemic impact on other sectors and the economy as a whole in the event of financial failure of the entity.

Whether the entity is likely to become a public interest entity in the near future.
Whether in similar circumstances, a predecessor firm has applied independence requirements for public interest entities to the entity.
Whether in similar circumstances, the firm has applied independence requirements for public interest entities to other entities.
Whether the entity has been specified as not being a public interest entity by law, regulation or professional standards.
Whether the entity or other stakeholders requested the firm to apply independence requirements for public interest entities to the entity and, if so, whether there are any reasons for not meeting this request.
The entity’s corporate governance arrangements, for example, whether those charged with governance are distinct from the owners or management.

Question 3 of the IESBA PIE Q&A explains how to assess each of the factors in paragraph 400.14 to determine if an entity's financial condition has significant public interest that makes it a PIE under the Code at the firm level. These factors should be considered holistically, rather than in isolation.

Q6.	PIE definitions under the AFRC Ordinance and the Code

Question:

Are the definitions of “Public Interest Entity” in the Accounting and Financial Reporting Council Ordinance (“AFRCO”) and in the Code the same?

Answer:

No, they are not the same and have different applications.

The Code’s definition of a PIE calls for additional auditor independence requirements.

The AFRCO’s definitions of the terms “PIE” and “PIE engagement” determine the scope of application of the Accounting and Financial Reporting Council’s (“AFRC”) regulatory powers under the PIE auditor regulatory regime, including the need to apply for registration as a PIE auditor with the AFRC (“registered PIE auditors”) in order to undertake or carry out a PIE engagement and the AFRC’s powers of inspection, investigation and discipline in respect of PIE engagements.

The AFRCO definitions of “PIE” and “PIE engagement” remain the same as before and are not affected by the Code’s revised definition of a PIE. The Code’s revised definition of a PIE has no effect on the scope of application of the AFRC’s regulatory powers in relation to PIE engagements as defined under the AFRCO.

The table below compares the definition of a PIE under the AFRCO with the definition in the Code.

PIE under AFRCO
(“AFRCO-PIE”)

PIE under the Code
(“Ethics Code-PIE”)

Definition

Under section 3(1) of the AFRCO, a public interest entity means:

(a) A listed corporation(equity); or

(b) A listed collective investment scheme.

Note: An entity with only listed debts without listed shares or stocks is not a PIE under the section 3(1) of the AFRCO.²²[1]

A PTE
A licensed bank defined under the BO except where there is no statutory requirement for audit to be performed.
An authorized insurer defined under the IO except for (i) captive insurers; (ii) special purpose insurers; and (iii) insurers where there is no statutory requirement for audit to be performed.
An entity specified as such by law, regulation or professional standards to meet the purpose described in paragraph 400.15 of the Code. They include:
MPF Schemes
MPF-exempted ORSO registered schemes with total assets exceeding HK$100 million by reference to the most recent set of audited financial statements
The Code also encourages firms to determine whether to treat other entities as PIEs for the purposes of auditor independence in the Code.

In theory, a PIE under the AFRCO is also classified as a PIE under the Code. However, an Ethics Code-PIE may not necessarily be an AFRCO-PIE. The table below highlights the similarities and differences between the two definitions.

Entities	AFRCO-PIE	Ethics Code-PIE
A listed corporation(equity)	Yes²³[2]	Yes, classified as PTE
A listed collective investment scheme	Yes²⁴[3]	Yes, classified as PTE
Entities with only listed debts without listed shares or stocks	No²⁵(note)	Yes, classified as PTE
Unlisted licensed banks or unlisted authorized insurers	No (note)	Yes, with exceptions. Under the Code, all licensed banks and authorized insurers are classified as PIEs, regardless of their listing status (subject to the noted exceptions in Question 2 and 6 above)²⁶[5]
MPF schemes	No	Yes²⁷[6]
MPF-exempted ORSO registered schemes with total assets exceeding HK$100 million by reference to the most recent set of audited financial statements	No	Yes²⁸[7]

note: Where an entity’s shares or stocks are in the process of being listed and an accountant’s report is required to be included in a listing document, that report will be a PIE engagement under the AFRCO. See below for discussion on PIE engagements under the AFRCO.

Question 7 further discusses “PIE engagements” and “registered PIE auditors” within the meaning of the AFRCO.

Footnotes:

22 Question 2, General Frequently Asked Questions, AFRC

23 Section 3(1), AFRCO

24 Section 3(1), AFRCO

25 Question 2, General Frequently Asked Questions, AFRC

26 Paragraphs R400.22(b)-(c) and 400.23 A3, Chapter A, Code

27 Paragraphs R400.22(d) and 400.23 A3, Chapter A, Code

28 Paragraphs R400.22(d) and 400.23 A3, Chapter A, Code

Q7.	Impact of PIE classification on auditor eligibility and independence requirements

Question:

Under what circumstances must an auditor be registered with the AFRC to perform a PIE engagement, and is the definition of a PIE in the Code relevant to determining this requirement?

Answer:

Pursuant to Part 1 of Schedule 1A of the AFRCO, a “PIE engagement” (“AFRCO-PIE Engagement”) is an engagement carried out by an auditor that involves the preparation of:²⁹

•	An auditor’s report on an AFRCO-PIE’s financial statements required by the Companies Ordinance (Cap. 622), the Listing Rules or any relevant code issued by the Securities and Futures Commission;
•	A specified report required to be included in (i) a listing document of a corporation seeking to be listed for the listing of its shares or stocks; (ii) a listing document of a listed corporation for the listing of its shares or stocks; or (iii) a listing document of a collective investment scheme seeking to be listed or a listed collective investment scheme; or
•	An accountant’s report required under the Listing Rules to be included in a circular issued by or on behalf of an AFRCO-PIE for a reverse takeover or a very substantial acquisition.

[1]

The AFRCO stipulates that AFRCO-PIE Engagements can only be undertaken and carried out by local registered PIE auditors or overseas PIE auditors recognized by the AFRC.³⁰

[2]

The question of whether an engagement is a PIE engagement under the AFRCO and whether the requirements for PIE auditor registration and other relevant regulatory powers apply under the AFRCO is determined solely by the AFRCO definitions of “PIE” and “PIE engagement”. The Code’s definition of a PIE is completely irrelevant..

Footnotes:
29	Question 3, General Frequently Asked Questions, AFRC
30	AFRC emphasises the importance of adherence to registration requirements for carrying out PIE engagements (AFRC Press Alert, 17 January 2025)

Q8.	Local maintenance of the PIE definition under the Code

Question:

Will the Institute make further local amendments to the PIE definition under the Code?

Answer:

Considering the wide range of possible PIE categories and the limitations posed by time constraints, the HKICPA Ethics Committee has decided to adopt a two-phase approach in refining the PIE definition at the local standard-setting level:

•

Phase 1 focused on refining the IESBA’s mandatory PIE categories in a local context. This has resulted in the PIE Provisions published on 15 July 2024, which refined the definition of a PIE in paragraph R400.22(b), (c) and (d) by introducing a locally developed paragraph 400.23 A3, taking into account the unique facts and circumstances of Hong Kong.

•

Phase 2 encompasses further research on any potential additional PIE categories. The research of Phase 2 may lead to another round of public consultation to include other categories of entities to the local definition of PIE in Chapter A of the Code.

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Revisions to the Definitions of Listed Entity and Public Interest Entity in the Code