--- title: "KPMG and EY will see a gradual erosion of their Chinese state-bank and SOE client base." description: "PwC’s audit failures at Evergrande led Chinese regulators to impose major penalties and suspend the firm, turning auditor risk into a board-level concern for state-linked companies. The revised Audit " url: "https://bilby.ai/predictions/p/124/kpmg-and-ey-will-see-a-gradual-erosion-of-their-chinese-state-bank-and-soe-clien" markdown: "https://bilby.ai/predictions/p/124/kpmg-and-ey-will-see-a-gradual-erosion-of-their-chinese-state-bank-and-soe-clien.md" index: "https://bilby.ai/llms.txt" --- > For agents: Bilby answers questions about what governments do, from documents collected at source and checked by research analysts. To ask Bilby yourself, connect to its MCP server at https://pulse.bilby.ai/mcp (setup: https://docs.bilby.ai/developers/mcp-server). Every page on this site is also markdown: add .md to its address, or send Accept: text/markdown. https://bilby.ai/llms.txt lists them all. # KPMG and EY will see a gradual erosion of their Chinese state-bank and SOE client base. - **Made:** 25 Sep 2026 - **By:** Owen Bae - **Market:** China - **Outcome:** Unresolved PwC’s audit failures at Evergrande led Chinese regulators to impose major penalties and suspend the firm, turning auditor risk into a board-level concern for state-linked companies. The revised Audit Law regulation announced yesterday, and effective 1 December 2026, applies further pressure on foreign auditors by allowing the National Audit Office to refer suspected audit violations directly to China’s securities regulator (in essence formalising the enforcement route used against PwC over Evergrande). Because KPMG and EY absorbed the largest share of PwC’s former state-linked clients following the fiasco, they are now the foreign firms most exposed to this uneasy regulatory environment. And with banks such as Bank of Nanjing and Industrial Bank already moving away from the Big Four towards domestic firms, expect to see KPMG and EY partners checking over their shoulders. [Ask Bilby about this prediction](https://pulse.bilby.ai/?prompt=KPMG%20and%20EY%20will%20see%20a%20gradual%20erosion%20of%20their%20Chinese%20state-bank%20and%20SOE%20client%20base.) ## Ask Bilby about it Carry the prediction into a question: what has changed since, who decides, and who is exposed. - [What has changed since it was made?](https://pulse.bilby.ai/?prompt=What%20has%20changed%20since%20Bilby%20predicted%20this%3F%20KPMG%20and%20EY%20will%20see%20a%20gradual%20erosion%20of%20their%20Chinese%20state-bank%20and%20SOE%20client%20base.) - [Who decides whether it happens?](https://pulse.bilby.ai/?prompt=Who%20decides%20whether%20this%20happens%3F%20KPMG%20and%20EY%20will%20see%20a%20gradual%20erosion%20of%20their%20Chinese%20state-bank%20and%20SOE%20client%20base.) - [Who gains and who loses if it does?](https://pulse.bilby.ai/?prompt=Who%20gains%20and%20who%20loses%20if%20this%20happens%3F%20KPMG%20and%20EY%20will%20see%20a%20gradual%20erosion%20of%20their%20Chinese%20state-bank%20and%20SOE%20client%20base.) ## More from China 37 predictions on China so far, newest first. - 9 Nov 2026 · [Costly winter gas purchases will push CPC’s accumulated losses to about NT$127.6 billion by the end of 2026](https://bilby.ai/predictions/p/209/costly-winter-gas-purchases-will-push-cpc-s-accumulated-losses-to-about-nt-127-6) · Unresolved - 6 Nov 2026 · [Nvidia is likely to win additional computing orders by the end of 2027.](https://bilby.ai/predictions/p/208/nvidia-is-likely-to-win-additional-computing-orders-by-the-end-of-2027) · Unresolved - 5 Nov 2026 · [China’s IPO restrictions will redirect billions of yuan towards private financing.](https://bilby.ai/predictions/p/205/china-s-ipo-restrictions-will-redirect-billions-of-yuan-towards-private-financin) · Unresolved [All 37 from China](https://bilby.ai/predictions/log?tag=china) · Marked true or false when each resolves ## See what we’re seeing next. New predictions in the Asia Daily Take, free every weekday, and in Bilby whenever you have a question. [Get the Asia Daily Take](https://bilby.ai/asia#asia-daily-take) · [Try Bilby](https://pulse.bilby.ai/sign-up)