NEW AIR ROUTE: Passengers in Inner Mongolia Autonomous Region board a flight to Taiwan on June 25, the day Air China opened a direct route from Hohhot to Taipei (YU JIA NEW)

Global Rating Firm

Three rating appraisers from China, Russia and the United States launched a new credit rating agency on June 25, in a bid to shake up the international credit rating industry traditionally cornered by the Big Three—Moody's, Standard & Poor's and Fitch.

Chinese Dagong Global Credit Rating teamed up with U.S. Egan-Jones Ratings Co. and RusRating from Russia in founding the Universal Credit Rating Group (UCRG), amid growing calls for a more balanced and accurate credit rating regime.

The joint venture is headquartered in Hong Kong and aims to provide what experts call "some checks and balances" to a broken rating industry blamed for underestimating and fueling the global financial crisis.

"Universal is going to provide a desperately needed check on some major assumptions that are provided by the ratings that currently exist in the marketplace," said Sean Egan, UCRG Director and President of Egan-Jones.

"A new international credit rating regime, which reflects the laws governing the development of our credit-based economy and essential requirements of credit rating, is urgently needed," said Guan Jianzhong, Chairman of UCRG and President of Dagong,

The group plans to establish by 2020 its new global credit rating service system. It aims to set up rating operations in all participating countries and generate credit risk information of every debt economy by 2025.

Auditor's Misconduct

China's top audit office on June 24 revealed its own problems, reporting about 24.04 million yuan ($3.89 million) of "flawed funds" in 2012.

An audit on the office showed its 2012 budget, as well as other financial revenues and expenditures, were well run, but certain problems existed, according to the National Audit Office.

For example, about 3.61 million yuan ($587,347) of spending on computer maintenance and equipment updating was not listed in the budget. Also, a purchasing plan to spend 216,000 yuan ($35,143) to renovate security and fire service systems in office buildings was not carried out.

The audit was carried out from March to April.