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Further guidance on new Chinese Accounting Standards

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01 Feb 2008

In February 2006, the China Accounting Standards Committee (CASC) adopted a comprehensive set of New Chinese Accounting Standards (CASs) that took effect for the 2007 financial reports of listed companies in China.

Unlisted companies are encouraged also to use the new CASs. The new CASs cover nearly all of the topics under the current IFRSs and, with a few exceptions, are substantially in line with IFRSs. Since then, the Ministry of Finance has been issuing both mandatory Interpretations and less formal guidance for applying the new standards. The guidance, which is being developed by an expert team formed by the CASC, includes two sets of Questions and Answers published in February and April 2007. On 21 January 2008, this team issued a Third Set of Q&A (PDF 96k, Chinese) addressing the following issues:
  1. Accounting for restricted shares by an investor who does not have control, joint control, or significant influence
  2. Accounting for warrant that are issued together with a bond
  3. How to apply the Interpretation to CASs No. 1 retrospectively to investments in subsidiaries that are obtained before the date of first-time adoption of new CASs
  4. Determining the value of the underlying assets and liabilities in the corporate reorganisation of state-owned enterprises
  5. Accounting by securities investment funds and similar entities
You'll find lots more information about accounting in China on our China Page.

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