From Reuters/WSJ a few mins ago: US and China nearing agreement that would allow American accounting regulators to travel to HK to inspect audit records of US listed Chinese companies. Securities regulators in Beijing are making arrangements for US-listed Chinese companies and their accounting firms to transfer their audit working papers and other data from Mainland China to HK. Regulators from the PCAOB would then travel to HK to perform on-site inspections of Chinese companies' auditors and their records. US accounting inspectors could arrive in HK as soon as September. A final agreement can only be reached if US side determines that it has full access to audit working papers.
We haven't heard any update on the auditing situation in a while. At least things are moving along on this biggest risk for Chinese ADRs.
