Ifrs in China
Introduction China has more than 5000 years of history, and was a mysterious country to most occidental people. Because of the influence of the culture and history, China use to be closed to foreign countries until 1979. Chinese people have their own accounting rules that are totally different from occidental countries’ accounting rules. With the development of China’s economy and the implementation of the reform and opening policy, Chinese economic system became from planning economy to free- market economy, more and more occidental countries focus on China -a fast developing country. More and more international cooperation and trade appeared. In order to get the best investment, to know well Chinese accounting system becomes more and more important for foreign companies.
History
According to historical report, the word “accounting” first appeared in 1100 B.C. in China. The duty for an accountant at that time was quite simple, nothing more than to calculate costs, revenue, and income daily, monthly and annually. After the founding of the new People’s Republic of China, with the influence of Soviet model, China created their own accounting system that followed the Soviet model to adopt their national circumstances at that time. But since the implementation of the reform and opening policy, China’s circumstances changed quite much, the accounting rules that created before cannot meet the needs of developing economy. So accounting reform came out to the government’s mind. (Jiashu Ge, Feng Liu, New Chinese Accounting Theory Studies for Past 50 Years Review. 1999)
Development
The first accounting reform began from 1980’s to 1990’s. In this decade, some foreign companies and joint-venture companies were set up; the main issue of accounting at this time was the conflict of different accounting model. After the reform, the joint-venture company accounting standards came out, and the accounting service market came out. The second
History
According to historical report, the word “accounting” first appeared in 1100 B.C. in China. The duty for an accountant at that time was quite simple, nothing more than to calculate costs, revenue, and income daily, monthly and annually. After the founding of the new People’s Republic of China, with the influence of Soviet model, China created their own accounting system that followed the Soviet model to adopt their national circumstances at that time. But since the implementation of the reform and opening policy, China’s circumstances changed quite much, the accounting rules that created before cannot meet the needs of developing economy. So accounting reform came out to the government’s mind. (Jiashu Ge, Feng Liu, New Chinese Accounting Theory Studies for Past 50 Years Review. 1999)
Development
The first accounting reform began from 1980’s to 1990’s. In this decade, some foreign companies and joint-venture companies were set up; the main issue of accounting at this time was the conflict of different accounting model. After the reform, the joint-venture company accounting standards came out, and the accounting service market came out. The second
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