When I say tax issues I mean Auditing/GAAP/SEC* in terms of the Chinese Gov not allowing GAAP to Audit the company, which increases the risk of delisting on a US Market.
" As a public company, we are required by the Sargbanes-Oxley law to be audited by a PCAOB registered auditor. Our auditor is based in China and has registered with the PCAOB. One of the requirements of this registration is to be inspected on a periodic basis by the PCAOB. These inspections include reviewing of the actual audit work papers prepared by our auditors as well as a review of the quality control procedures of our auditor. The SEC and the PCAOB are endeavoring to arrive at a mutual understanding as to auditor inspections with the Chinese Government. The Chinese Government up until now has not allowed the PCAOB inspectors to review the work papers of our auditor.
Regular inspection by the PCAOB of public company auditors was one of the cornerstones of the Sarbanes-Oxley law. The lack of inspections is contrary to US law and deprives the current and future shareholders of any and all benefits that would be derived by this important oversight of auditors. This lack of oversight and the added expense associated with the inspections also puts any US based audit firm in a distinct disadvantage when competing with a Chinese based audit firm for work in China. - HERB 10-K
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