Modification of accounting regulations for small businesses

 
Starting from 01, January 2005, small enterprises will "Close the old account, Adopt a new one". PRC CPA firms will audit the financial statements of small enterprises and issue audit reports based on the new 'Accounting Regulations For Small Enterprise'. The financial statements for year 2004 are prepared according to the existing accounting regulations.
1. Enterprises simultaneously meet the below two criteria would be classified as small enterprises:
  a) Funds for working capital are raised internally. No shares or debentures are offered to the public.
b) Business scales are relatively small
     
2. Changes on the existing 'Accounting Regulation for Enterprises'
  a) Provision for impairment: only short-term investment, stock on hand and account receivable are subject to impairment; long-tem investment such as fixed assets and intangible assets are not required to provide the provision.
b) Valuation of long-term investment: based on simplified Equity method.
c) Costs on borrowing: all borrowing costs incurred should be capitalized until the corresponding fixed assets are fully completed and ready for use.
d) Financial statements: only Balance Sheet and Profit and Loss Account are needed to be provided
     

小企業會計制度新變化
 

小企業從2005年1月1日起，結束舊賬，建立新賬。會計師事務所以《小企業會計制度》為會計標準對小企業進行審計，出具審計報告。2004年度的會計報表仍按現行會計制度編制。


一、同時具備以下兩個標準的為小企業：
（一）不對外籌集資金。即不公開發行股票和債券。
（二）經營規模較小的企業。


二、與現行《企業會計制度》不同之處
a) 資產減值準備:僅要求對短期投資、存貨和應收款項計提減值準備，不要求對固定資產、無形資產等長期資產計提減值準備。
b) 長期投資的核算:僅要求按照簡化的權益法核算。
c) 借款費用的核算:在固定資產開始建造至達到預定可使用狀態之前所發生的專門借款費用，均可資本化計入固定資產成本。
d) 會計報表:提供資產負債表和利潤表兩張基本報表。