Starting 1 January 2001, all joint stock limited enterprises (“JSLEs”) were required to follow the System – except enterprises in banking, insurance, and other specialised financial industries. When the System became effective on 1 January 2001, the old Accounting System for JSLEs was abolished. Starting from 2001, enterprises besides JSLEs have been encouraged to follow […]
As of 1 January 2002, the MOF extended the applicable scope of the System to all foreign invested enterprises excluding those in banking, insurance, and other financial service industry.
Early in 2002, the MOF issued a new separate – though similar – accounting system for Financial Institutions. It must be adopted, starting 1 January 2002, by all listed and foreign invested banks, insurance companies, brokerages, leasing companies, and finance companies. Unlisted financial institutions that are joint stock limited enterprises are encouraged to follow the […]
While both are formulated and promulgated by MOF, there exist certain differences them. First, the application scope is different. Specific accounting standards are mostly applicable to joint stock limited companies, although sometimes the standards apply to other enterprises too. The Accounting System applies not only joint stock limited companies, but also other qualified enterprises. Second, […]
(a) Accounting Entity An accounting entity can be an enterprise, an enterprise group or the accounting department of an enterprise. (b) Continuity Postulate The Accounting System stipulates that, under normal circumstances, the accounting treatment to be adopted by enterprises should be based on continuity postulate. For instance, the historical costing method is used for the […]
The general principles guiding and evaluating accounting work comprise three categories. general principles for evaluating the quality of accounting information; general principles for recognizing and measuring accounting elements; and general principles for revising the above two sets of principles.
In 2000, the State Council of the PRC issued Financial Accounting and Reporting Rules for Enterprises (“FARR”). It focuses on financial accounting and reporting matters such as bookkeeping, preparation of financial statements, and reporting practices. It applies to all enterprises other than very small ones that do not raise funds externally.
The composition and roles of an audit committee are described in Section 301 of SOX. According to the SEC decree on April 9, 2003, all US stock exchanges should issue rules before July 23, 2005 so that foreign companies which are listed at US stock exchanges possess an audit committee. According to Section 205 of SOX, the […]
The following steps are developed based on the COSO framework. They can help you to analyze the structures of the processes of your control system and help you to implement a new internal control system. 1. Form discussion groups and brainstorm about your business processes, main risks, current reporting structure, your business environment and so […]
COSO’s five elements have been essentially adopted by more and more professionals as the cornerstone of SOX though SOX does not specify which internal control framework to follow. a) the control environment, b) risk assessment, c) control activities, d) information and communication and e) monitoring
