Ningbo Focus (September 2012)
2
BUSINESS ｜商业 24 ningbo focus September 2012 www.ningbofocus.com A good old saying says: ‘The fish is the last to see the water’. Something which, translated to accounting and reporting lingo means: ‘It will be difficult, if not impossible, to ask a Chinese advisor, consultant or accounting professional to identify all major differences between Chinese and, e.g. Danish accounting law’. I will in this article focus on some of the main differences between China and ‘The West’. 1. Monthly accounts Foreign invested companies in China are submitting their financial reports on a monthly basis to the tax bureau. The monthly reports shall hold the same quality level and standards as if they had been made by a senior auditor from Deloitte, KPMG, PwC or E&Y. Errors found in the monthly reporting can result in penalties. 2. Annual audit The annual report is based upon the monthly reports submitted to the tax bureau the previous year. Changes or adjustments will not be affecting the company’s financial opening balance of the year, and rather be posted directly towards your company’s equity in the monthly report of April or May. No Annual General Meeting is to be held, and no Board Report is to be signed. 3. Annual tax inspection While one in the west takes for granted that the tax calculation will be done automatically as a part of the Annual Audit, the same is not the case in China. A separate ‘Annual tax inspection report’ shall be made once the Annual Audit work has been finalized. It is recommended that you either ask your auditor or a tax agent to get the report made. Once filed, accepted and approved, the tax bureau will issue the Annual Tax Payment Certificate. This document is a must for companies seeking to expatriate dividends. ACCOUNTING & REPORTING CHALLENGES FOR FOREIGN-INVESTED ENTERPRISES (FIEs) IN NINGBO An executive summary of the main differences between China and ‘The West’ Helge Hareland 4. Credit notes Credit notes do not exist in China. A quite common way to make credit towards invoices issued in the past was to re-issue the same invoice with a lower amount. In order to avoid such ‘credits’ being posted towards previous periods, you should consider physically closing an accounting period in your ERP system once starting to register towards the next one. In order to be ‘double safe’ – base your monthly group reports on accumulated figures and not monthly figures. 5. Charts of accounts The standard Chinese ‘chart of accounts’ dates back to a time when manual bookkeeping was norm. Where you operate with ten accounts, you may see that a typical Chinese company is using one. It is, from a reporting perspective, easier to summarize ten accounts into one, than breaking one account up into ten. Therefore, the time you invest in lifting the standards of your charts in China will quickly pay off in terms of an improved reporting quality. 6. Consolidation Not many Chinese finance or accounting professional have gotten knowledge and experience from group companies that requires consolidated group accounts and demands that group-figures are being kept in separate accounts for consolidation purposes. The result is often that the sales income from group customers ends up in the same accounts as sales income from ordinary customers. The same applies to other income, cost, assets and debt accounts. 7. Work in progress Even though both the ‘invoicing principle’ and the ‘percentage of completion principle’ can be used in China, the majority of the Chinese accountants will swear to a version of the ‘invoicing principle’ which will not be accepted By ( 作者 ): Helge Hareland 财务数据及报告中的挑战 供宁波外资企业参考 | 中西方之间存在的主要差异的汇总报告 by foreign invested companies. The general advice tied to ‘work-in-progress’ and ‘product costing’ is to invest a substantial amount of time in documenting the preferred procedures and routines tied hereto, preferably down to the last debit and credit posting, as ‘your way’ for most will represent ‘a different language’. 8. Closing remarks Even though the standards applied in China in terms of accounting and reporting are getting closer to those applied in the west – there are still many differences in play. Do therefore always make sure that you consult a professional third party as early as possible, and preferably before the ‘wrong routines’ have settled in. ■ Photo by: Helge Hareland 有句俗语说得好：“当局者迷”。将其翻 译成财务数据及报告中的专业术语就是：“向 一位中国的指导、顾问或者财务专业人士询问 中国和西方国家，比如丹麦的会计法之间所存 在的主要区别十分困难，甚至是一件无法办到 的事情。”所以，我将会在本文中重点讲述中 西方之间在这方面存在的主要差异。 1. 月报表 中国外资企业每月要向税务局上报财务报 表。月报表必须严格按照标准制作，就如同出 自来自德勤会计事务所、毕马威会计事务所、 PwC 或 E&Y 的审计员之手。月报表中若被发 现错误，企业将承担相关后果。 2. 年度审计 年度报表是根据企业前一年上报税务局的 月报表制作而成的。其更改或调整均不会影响 企业财务的期初余额，也不会直接影响到对 四五月份报表的审核。年底时不会召开年度总 结大会，也不会张贴公示年度总报表。 3. 年度税务稽查 在西方，人们理所当然地认为税务稽查是
Transcript of Ningbo Focus (September 2012)
BUSINESS ｜商业
24 ningbo focus September 2012 www.ningbofocus.com
A good old saying says: ‘The fish is the last to see the water’. Something which, translated to accounting and
reporting lingo means: ‘It will be difficult, if not impossible, to ask a Chinese advisor, consultant or accounting professional to identify all major differences between Chinese and, e.g. Danish accounting law’. I will in this article focus on some of the main differences between China and ‘The West’.
1. Monthly accountsForeign invested companies in China are submitting their financial reports on a monthly basis to the tax bureau. The monthly reports shall hold the same quality level and standards as if they had been made by a senior auditor from Deloitte, KPMG, PwC or E&Y. Errors found in the monthly reporting can result in penalties.
2. Annual auditThe annual report is based upon the monthly reports submitted to the tax bureau the previous year. Changes or adjustments will not be affecting the company’s fi nancial opening balance of the year, and rather be posted directly towards your company’s equity in the monthly report of April or May. No Annual General Meeting is to be held, and no Board Report is to be signed.
3. Annual tax inspectionWhile one in the west takes for granted that the tax calculation will be done automatically as a part of the Annual Audit, the same is not the case in China. A separate ‘Annual tax inspection report’ shall be made once the Annual Audit work has been finalized. It is recommended that you either ask your auditor or a tax agent to get the report made. Once fi led, accepted and approved, the tax bureau will issue the Annual Tax Payment Certifi cate. This document is a must for companies seeking to expatriate dividends.
ACCOUNTING & REPORTING CHALLENGES FOR FOREIGN-INVESTED ENTERPRISES (FIEs) IN NINGBOAn executive summary of the main differences between China and ‘The West’
Helge Hareland
4. Credit notesCredit notes do not exist in China. A quite common way to make credit towards invoices issued in the past was to re-issue the same invoice with a lower amount. In order to avoid such ‘credits’ being posted towards previous periods, you should consider physically closing an accounting period in your ERP system once starting to register towards the next one. In order to be ‘double safe’ – base your monthly group reports on accumulated fi gures and not monthly fi gures.
5. Charts of accountsThe standard Chinese ‘chart of accounts’ d a t e s b a c k t o a t i m e w h e n m a n u a l bookkeeping was norm. Where you operate with ten accounts, you may see that a typical Chinese company is using one. It is, from a reporting perspective, easier to summarize ten accounts into one, than breaking one account up into ten. Therefore, the time you invest in lifting the standards of your charts in China will quickly pay off in terms of an improved reporting quality.
6. ConsolidationNot many Chinese finance or accounting professional have gotten knowledge and experience from group companies that requires consolidated group accounts and demands that group-fi gures are being kept in separate accounts for consolidation purposes. The result is often that the sales income from group customers ends up in the same accounts as sales income from ordinary customers. The same applies to other income, cost, assets and debt accounts.
7. Work in progressEven though both the ‘invoicing principle’ and the ‘percentage of completion principle’ can be used in China, the majority of the Chinese accountants will swear to a version of the ‘invoicing principle’ which will not be accepted
By ( 作者 ): Helge Hareland
财务数据及报告中的挑战供宁波外资企业参考 | 中西方之间存在的主要差异的汇总报告
by foreign invested companies. The general advice tied to ‘work-in-progress’ and ‘product costing’ is to invest a substantial amount of time in documenting the preferred procedures and routines tied hereto, preferably down to the last debit and credit posting, as ‘your way’ for most will represent ‘a different language’.
8. Closing remarksEven though the standards applied in China in terms of accounting and reporting are getting closer to those applied in the west – there are still many differences in play. Do therefore always make sure that you consult a professional third party as early as possible, and preferably before the ‘wrong routines’ have settled in. ■
Photo by: Helge Hareland
有句俗语说得好：“当局者迷”。将其翻译成财务数据及报告中的专业术语就是：“向一位中国的指导、顾问或者财务专业人士询问中国和西方国家，比如丹麦的会计法之间所存在的主要区别十分困难，甚至是一件无法办到的事情。”所以，我将会在本文中重点讲述中西方之间在这方面存在的主要差异。
1. 月报表中国外资企业每月要向税务局上报财务报
表。月报表必须严格按照标准制作，就如同出自来自德勤会计事务所、毕马威会计事务所、PwC 或 E&Y 的审计员之手。月报表中若被发现错误，企业将承担相关后果。
2. 年度审计年度报表是根据企业前一年上报税务局的
月报表制作而成的。其更改或调整均不会影响企业财务的期初余额，也不会直接影响到对四五月份报表的审核。年底时不会召开年度总结大会，也不会张贴公示年度总报表。
3. 年度税务稽查在西方，人们理所当然地认为税务稽查是
BUSINESS ｜商业
September 2012 ningbo focus 25www.ningbofocus.com
年度审计的一部分，但中国并非如此。当年审工作结束之后，企业还需另作一份“年度税务稽查报表”。建议企业可以通过审计员或者税务中介来完成这份报表。一旦被存档、接受、批准之后，税务部门便会颁给企业一份年度纳税证书。这份材料对企业寻求股息分配必不可少。
4. 信用票据中国不存在信用票据这一说法。过去制造
信用票据的其中一种常规方法就是用较小的金额重新做一张票据。为了避免对之前造成信用上的影响，您应该考虑一旦开始注册下一个会计年度之前在 ERP 系统中先关账。为了起到“双重保险”的作用，请在月度报表中使用累计数据而非单纯的月度数据。
5. 会计科目表标准的中国“会计科目表”的使用可以追
溯到手工簿记时代。当您看过十名会计师操作，您就会发现有一家典型的中国企业在使用。从报告学角度讲，把十名会计师总结成一个要比把一名会计师分割成十个来得容易。所以，当您投资在提升中国报表标准之时很快便会在报告质量提升方面得到收益。
6. 合并拥有集团公司专业知识和工作经历的专业
财务或会计人员在中国并不多见，他们很多都不知道集团公司中要求将合并的集团账户和集团数据在独立的账户中进行操作，以便达到合并目的。这样做的结果往往是来自集团客户的销售收入会与来自普通客户的销售收入进入同一个账户。这同样发生在其他收入、成本、资产和债务账户中。
7. 在制品虽然“进销存原理”和“完工百分比原理”
在中国适用，但大部分的中国会计师会坚持认为这一原则不被外商投资企业所接受。与“在制品”和“产品成本计算”相关的总体建议是花大量时间证明更好的程序和例程，因为“您的方式”很有可能会代表“一种不同的语言”。
8. 结束语虽然中国的财务数据和报告正越来越接近
西方国家，但依然存在着许多区别。所以在“错误的例程”出现之前，请确保您向专业的第三方做了咨询。 ■
图片来源：Helge Hareland
The Author Helge Hareland is the Founding Partner at Hareland Capital Ltd. (www.hareland.com) and Chairman at Point Services (Ningbo) Co. Ltd. (www.point-services.net). Helge has been living and working in Ningbo since July 2000. In addition to be an investor and company owner, he is also a specialist in corporate structuring and financing. Helge is an advisor to foreign investors planning to invest in China and Chinese investors seeking investment opportunities abroad. He can be reached at [email protected] and [email protected].
作者 Helge Hareland 是 Hareland 资本有限公司（www.hareland.com）的创建人，同时也是 Point 服务（宁波）有限公司（www.point-services.net）的董事长。Helge 从 2000 年 7 月开始便在宁波居住工作。他除了投资、自营企业之外，还是一个企业组织和理财方面的专家。Helge 为想在宁波投资的外商以及想去国外寻求投资机遇的中国人做顾问。您可以通过以下网址联系到他：[email protected] 和 [email protected]。
