From December 29, 2001, the Ministry of Finance, Accounting [ 2000 ] No. 25, issued a “ notice ” on the issue of the “ endeavor accounting system ” , the presentment demand Corporation from January 1, 2001 execution of the “ endeavor accounting systemaa‚¬A? The original “ Limited accounting system – of histories and accounting statements ” abolished at the same clip. There are major alterations in the New accounting system and the old accounting system.
Management Accounting System Feature:
Reflect the rule of integrity. The new system is no longer sub-sector ( excepting fiscal and insurance endeavors and foreign funding, little graduated table endeavors )
Embodies genuineness ( objectiveness, dependability ) rule.
Reflect the accounting criterions internationalisation. Such as the terminal of the stock lists, investings, fixed assets denominated.
Try to be consistent with the revenue enhancement Torahs can non be consistent with the appropriate separation ( to take revenue enhancement accommodation method for treating ) .
Detailed Account of the pecuniary fund “ other pecuniary fund ” natural “ in theodolite pecuniary financess, recognition card sedimentations, the recognition border sedimentations, ” kept out of investing money ” .
1. Receivables accounting
Provision for bad debts in the scope. The new system will necessitate the purchase and sale of endeavor activities receivables and non-purchase and sale activities receivable debt ( for illustration, a assortment of claims, salvage a sedimentation, imprested, and charged to the worker progresss at ) Provision for dubious debts.
2. Treatment of bad debt losingss. The direct write-down method used by the original accounting system fix on an accrual footing, the new accounting system for all the allowance method.
3. In order to work out the proviso for bad debts of entropy, the new accounting system shall non be permitted to pull out secret readyings. Secret readying extracted more than the existent loss of assets and more assets for damage.
4. Inventory accounting
( 1 ) The stoping stock list rating is no longer merely the original cost, utilizing the lower of cost or market rating.
( 2 ) Contributions of stock list rating in different ways. The new system requires the different intervention: givers provide certificates ; donated stock list there is an active market ; there is no active market.
( 3 ) Debt restructuring and non-monetary dealing, stock list processing by accounting criterions.
( 4 ) The overage accounted for an estimated value of stock lists, alteration valued at market monetary values.
( 5 ) Closing stock monetary value of less than the difference between the historical cost of stock lists, the new system provides straight included in “ administrative disbursals ” agenda reflects the terminal of the plus for damage. The old accounting system for stock list obsolescence is credited topics, the terminal of the twelvemonth reflected in the income statement.
Fixed assets accounting
( 1 ) VAT refundable foreign endeavors to buy domestic equipment write-offs of the transporting value of fixed assets.
( 2 ) Investors invested in fixed assets, the original investors cast the assessed value of the plus is accounted for ; under the new system is accounted for by the value of the parties confirmed.
( 3 ) Donated fixed assets, the old accounting system carried reset full value ; under the new system the certificates provided by givers accounted for, no certificates are accounted for by the market monetary value of similar assets, no similar fixed assets market monetary value stated at the present value of its future net incomes.
( 4 ) the value of the fixed assets transferred free of charge, the old accounting system accounted for harmonizing to the original cost of units transferred out alternatively transferred units net plus conveyance fees, installing fees, costs associated with the new system, after depreciation harmonizing to the staying utile life lives.
( 5 ) Non-monetary minutess through debt restructuring, alteration into the intervention of fixed assets, the execution of accounting criterions require.
( 6 ) The overage of fixed assets, the old accounting system demands are stated at replacing cost ; new system similar market value subtraction stated at the cyberspace after the newness the depletion of assessed value alternatively.
( 7 ) On the building of fixed assets, if you have reached the province, but did non use for the completion of formalities, the estimated value is transferred to fixed assets histories depreciated.
( 8 ) on fixed assets is expected to age and use, the old accounting system net residuary rate of 3 % -5 % , foreign-funded endeavors was 10 % ; Under the new system is decided by the endeavors themselves, harmonizing to the fixed assets class, features, their ain existent conditions.
( 9 ) For contributions of used fixed assets, should be based on the adjusted expected value and the expected staying utile life and net salvage value, and choice of the depreciation method for processing.
( 10 ) Add the unrecognised finance charge “ the difference between the original topics, accounting corporate finance rental fixed assets, lease start day of the month of the lease assets book value and the present value of the minimal rental payments.
( 11 ) Overage fixed assets overage stock list processing ; the terminal of the twelvemonth may non open history.
( 12 ) New “ damage of fixed assets ” topics, period fails separately assessed damage of fixed assets, and losingss are included in “ operating disbursals ” .
( 1 ) The intervention of intangible assets of non-monetary minutess.
( 2 ) The subsequent cost of intangible assets, net income or loss.
( 3 ) Net addition on sale of intangible assets included in runing income, rental income of intangible assets, included in other runing income.
( 4 ) Increase the damage of intangible assets “ topics, harmonizing to the single damage proviso, an impairment loss is included in ” operating disbursals “ .
Add for damage of building in advancement “ topics, impairment losingss included in ” operating disbursals “ .
Cancel the deferred assets “ capable included in long-run prepaid disbursals, readying costs incurred during the clip since the beginning of production operations from the month through net income or loss are included in administrative disbursals.
9. Investing accounting
( 1 ) The cost of investing is divided into initial costs and investing costs.
( 2 ) A non-cash plus investing as non-monetary minutess.
1. Cargo of goods shall be recognized as a liability.
2. The triumph unified distributed to stockholders and net incomes as dividends collectible, the original system includes merely hard currency dividends, excepting net incomes collectible.
3. Meet the conditions for the acknowledgment or liabilities, should be recognized as a realistic liabilities
4. Earmarks accounted for individually, included in the particular histories collectible, until the completion of the undertaking, in conformity with the formation of the value of fixed assets transferred to the capital modesty.
5. Unable to pay histories collectible originally included in non-operating income, the commissariats of the new system are included in capital excess.
6. Borrowing costs are accounted for individually established guidelines.
1. Separate histories to accept contributions of hard currency and non-cash.
2. Truly unable to pay histories collectible included in capital excess.
3. The new system allows the excess modesty for the distribution of hard currency dividends or net incomes.
Grosss, costs, disbursals, and net income distribution
1. Gross stressed that the “ substance over form rule ” .
2. The net returns of disposal of intangible assets included in runing income.
3. Net loss on disposal of intangible assets, proviso for damage of intangible assets, damage of fixed assets are included in operating disbursals for damage of building in advancement.
4. Inventory devaluation losingss included in “ administrative disbursals ” .
Changes in fiscal and accounting studies
Changes in fiscal and accounting studies
1. Increased coverage and content: Damage of assets “ agenda. ”
2. Changes in the balance sheet of the state of affairs:
( 1 ) The assets ( fixed assets ) are carried at net reflects. The Entrusted Loan prepare were reflected in short-run investings and long-run investing undertakings.
( 2 ) The tabular array is no longer “ pending belongings net income and loss, there are still topics to cover with the terminal of the twelvemonth, and non allowed to open history.
( 3 ) Liabilitiess increased undertaking “ expected liabilities ” .
3. Changes in the income statement:
( 1 ) “ Operating disbursals ” moved under “ Other operating net income ” .
( 2 ) The canceled for stock list obsolescence undertaking transferred to the direction cost accounting is no longer as an point of the income statement.
4. Statement of Cash Flows Changes in:
Cash flows from operating activities ; VAT is no longer separated from the ad valorem revenue enhancement.
Position from the accounting system reform, chiefly the undermentioned two content:
1. Implement the rule of prudence, comprehensive proviso for plus damage. “ Enterprise accounting system in conformity with the demands of the accounting conservativism rule of accounting elements redefine the comprehensive alteration of content that does non run into the definition of accounting elements, does non follow with the acknowledgment and measuring of accounting elements, to necessitate endeavors of untrue assets must impairment allowances, including the proviso for bad debts, stock list proviso for decline in the value of short-run investings for decline in value of long-run investings for damage, damage of fixed assets, damage of intangible assets for damage of building in advancement, commissioned loan damage charges. From the point of view of accounting regulations and norms, attempts to decide the job of false corporate net income and loss, the short-run behavior and accounting information deformation, promote endeavor relieved the load of going visible radiation.
2. The execution of the stage separation of accounting and revenue enhancement pattern. Accounting system and revenue enhancement system of endeavors phase separation is a common international pattern, in practical work, the accounting system, if any, and the revenue enhancement system is inconsistent or uncoordinated fiscal consequences calculated harmonizing to the accounting system, and should be adjusted in conformity with the revenue enhancement system net incomes. For illustration, the current accounting system AG extraction Lu Xiang prepare, extraction ratio determined by the endeavors themselves, which needfully inconsistent accounting system and the province ‘s revenue enhancement commissariats, and in this instance, the endeavors should be accounted for in conformity with the accounting system in the computation of revenue enhancement accommodations in the income revenue enhancement. If you do non implement the stage separation of accounting and revenue enhancement, accounting hardiness of certain accounting rules will non be able to transport out.