the us and china are nearing an agreement that would allow american accounting regulators to travel to hong kong to inspect the audit records of chinese companies listed in new york according to people familiar with the matter as the two countries move toward resolving a yearslong standoff securities regulators in beijing are making arrangements for uslisted chinese companies and their accounting firms to transfer their audit working papers and other data from mainland china to hong kong the people said regulators from the us public company accounting oversight board would then travel to the semiautonomous city to perform onsite inspections of the chinese companies’ auditors and their records they added the china securities regulatory commission recently informed some accounting firms and companies about the plan the people said adding that us accounting inspectors could arrive in hong kong as soon as next month a final agreement can only be reached if the us side determines that it has full access to the audit working papers they said the csrc said in response to a wall street journal query that it doesn’t have any relevant information to disclose the pcaob declined to comment more than 200 uslisted chinese companies are facing the prospect of being booted off american stock exchanges starting in early 2024 if their auditors can’t be inspected by the pcaob for three consecutive years around 160 companies—including alibaba group holding ltd baba  jdcom jd and baidu inc bidu —have so far been identified as noncompliant with the holding foreign companies accountable act which took effect last year for years regulators in china were reluctant to allow such inspections and argued that unfettered access to companies’ audit papers and their data could threaten the country’s national security yj fischer an official with the us securities and exchange commission recently said such a claim is “questionable at best” since the hfcaa took effect authorities in china have expressed a desire to find a way to comply with the law as the threat of involuntary delistings looms some uslisted chinese companies including alibaba and yum china holdings inc are planning to convert their secondary listings in hong kong to primary listings that would allow their shares to continue trading in the asian financial hub if they are kicked off us exchanges an expanded version of this story appears on wsjcom