EY Hong Kong resigned from the audit of Standard Water on when it emerged that although EY Hong Kong had signed off the audit, it had been effectively outsourced to the affiliate in mainland China, which had received 99.98% of the fee. This was important because shareholders have less confidence in mainland auditors and because audit papers on the mainland are subject to state secrecy laws and can be withheld from outside regulators. EY's quality and risk management leader (Greater China) even testified in the Court of First Instance that he was not sure whether there was a formal agreement covering the relationship between the two EY entities. The court case in 2013 came as US regulators were taking an interest in similar cases of accounting fraud in mainland China.