LONDON - China Evergrande Group said PwC resigned as its auditor on Monday, adding to the pressure on the developer at the epicentre of China’s property crisis.

Evergrande’s board recommended the resignation of PwC after the two firms could not “agree on the timetable and the scope of work in respect of the assessment on the group’s going concern basis”, as well as the “procedures required for the assets impairment assessment”, according to a regulatory filing.

In its resignation letter to Evergrande’s audit committee and board on Monday, PwC noted that it still had not received information relating to “significant matters” of the 2021 audit. This included cash flow forecasts, the net realisable value of the group’s properties under development and even the consolidated financial statements of the group, the filing said.

The lack of information meant PwC was “unable to determine the scope of any necessary additional audit work” and was also not in a position to provide a reasonable estimate of the time required to complete the audit for the year 2021, according to the auditor.

The delayed audit of Evergrande’s 2021 financial statements was hindering Evergrande’s attempts to restructure its debts, according to the statement. As a result, its board decided to appoint another auditor in an attempt to “complete the audit work as soon as practicable”.

Evergrande defaulted more than a year ago and its efforts to reach a solution with creditors are under close scrutiny, with various deadlines having been missed. Its debt overhaul would be one of China’s biggest ever and carries broader implications for the country’s US$58 trillion (S$76.6 trillion) financial system.

PwC’s resignation came months after Hong Kong’s Accounting and Financial Reporting Council said it was stepping up an investigation into Evergrande’s accounts and the audits of some transactions at the company and its subsidiary, Evergrande Property Services Group. The auditing regulator is expanding the scope of its inspections for Evergrande’s financial statements for 2020 and the first half of 2021, and a probe of an audit carried out by PwC.

Shares of Evergrande have been suspended in Hong Kong since it failed to release audited financial statements last March.

Evergrande’s board has resolved to appoint Prism Hong Kong & Shanghai as the interim auditor until the conclusion of the next annual general meeting of the company, according to the statement.

Prism worked as an auditor with 10 listed clients last year versus 440 at PwC, according to data compiled by Webb-site.com. Prism was founded in 2013, its website shows.

Evergrande held its first in-person meeting with members of an ad hoc group of bondholders in Hong Kong recently.

This came after Evergrande missed another self-imposed deadline to publicly deliver a preliminary restructuring blueprint by the end of 2022. The company expected to receive support from offshore creditors by the end of February or early March, its legal representative said during a winding-up hearing in late November. A petition that could result in asset liquidation is pending in a Hong Kong court. BLOOMBERG