Alibaba, JD.com are among the Chinese stocks reportedly being targeted by US auditors for inspection next month

• Alibaba, JD.com and YUM China are among US-listed Chinese companies being targeted by regulators.
• The audit inspection is being conducted by the US Public Company Accounting Oversight Board.

Regulators are targeting Alibaba, JD.com and others for their first set of audit inspections after a deal was reached last week on the financials of Chinese stocks traded in US markets.

Reuters reported Tuesday the inclusion of JD.com and YUM Brands China to the initial slate of companies. Sources told Bloomberg reported that Alibaba, Baidu and NetEase are also on the list.

The US Public Company Accounting Oversight Board Review requested to review materials from the most recent financial year and will conduct its work in Hong Kong next month, Bloomberg said.

US regulators had been engaged in a back-and-forth with Chinese counterparts for decades over access to the financials of Chinese companies.

A 2020 law imposed a deadline for China to hand over documents for review or risk having Chinese stocks delisted from US exchanges. But on Friday, the US and China reached an agreement on the audit paperwork.

China maintains it will be equally part of the review process although the PCAOB continues to assert its sole ability to select the firms subject to audit review as well as the applicable violations.