China Accounting Standards (eBook)

Contents 5
1 Introduction to New Accounting Standards for Business Enterprises 16
2 ASBE’s Main Features and General Differences of New China GAAP Versus US GAAP and IFRS 19
3 Impact and Results on Financial Statements 23
4 Effects of the New PRC GAAP 25
5 Accounting Standards for Business Enterprises No. 1—Inventories 26
5.1 Chapter I: General Provisions 26
5.2 Chapter II: Recognition 26
5.3 Chapter III: Measurement 27
5.4 Chapter IV: Disclosure 29
5.5 Comments 29
5.6 Examples 30
6 Accounting Standards for Business Enterprises No. 2—Long-Term Equity Investments 31
6.1 Chapter I: General Provisions 31
6.2 Chapter II: Initial Measurement 31
6.3 Chapter III: Subsequent Measurement 32
6.4 Chapter IV: Disclosure 35
6.5 Comments 35
6.6 Example 36
7 Accounting Standards for Business Enterprises No. 3—Investment Real Estates 37
7.1 Chapter I: General Provisions 37
7.2 Chapter II: Recognition and Initial Measurement 38
7.3 Chapter III: Follow-Up Measurement 38
7.4 Chapter IV: Conversion 39
7.5 Chapter V: Disposal 39
7.6 Chapter VI: Disclosure 40
7.7 Comments 40
7.8 Examples 41
8 Accounting Standards for Business Enterprises No. 4—Fixed Assets 42
8.1 Chapter I: General Provisions 42
8.2 Chapter II: Recognition 42
8.3 Chapter III: Initial Measurement 43
8.4 Chapter IV: Subsequent Measurement 44
8.5 Chapter V: Disposal 45
8.6 Chapter VI: Disclosure 45
8.7 Comments 46
8.8 Examples 47
9 Accounting Standards for Business Enterprises No. 5—Biological Assets 48
9.1 Chapter I: General Provisions 48
9.2 Chapter II: Recognition and Initial Measurement 49
9.3 Chapter III: Subsequent Measurement 50
9.4 Chapter IV: Harvest and Disposal 52
9.5 Chapter V: Disclosure 52
9.6 Comments 53
9.7 Examples 54
10 Accounting Standards for Business Enterprises No. 6—Intangible Assets 55
10.1 Chapter I: General Provisions 55
10.2 Chapter II: Confirmation 55
10.3 Chapter III: Initial Measurement 57
10.4 Chapter IV: Subsequent Measurement 57
10.5 Chapter V: Disposal and Discarding 58
10.6 Chapter VI: Disclosure 58
10.7 Comments 59
10.8 Examples 60
11 Accounting Standards for Business Enterprises No. 7—Exchange of Non-Monetary Assets 61
11.1 Chapter I: General Provisions 61
11.2 Chapter II: Confirmation and Measurement 62
11.3 Chapter III: Disclosure 63
11.4 Comments 63
11.5 Examples 64
12 Accounting Standards for Business Enterprises No. 8—Impairment of Assets 65
12.1 Chapter I: General Provisions 65
12.2 Chapter II: Recognition of Assets with Potential Impairment 66
12.3 Chapter III: Measurement of Recoverable Amount of Assets 66
12.4 Chapter IV: Determination of Losses of Asset Impairment 69
12.5 Chapter V: Recognition of Group Assets and Treatments of Impairment 69
12.6 Chapter VI: Treatment of Impairment of Business Reputation 71
12.7 Chapter VII: Disclosure 72
12.8 Comments 74
12.9 Examples 76
13 Accounting Standards for Business Enterprises No. 9—Employee Compensation 77
13.1 Chapter I: General Provisions 77
13.2 Chapter II: Confirmation and Measurement 77
13.3 Chapter III: Disclosure 78
13.4 Comments 79
13.5 Examples 80
14 Accounting Standards for Business Enterprises No. 10—Enterprise Annuity Fund 81
14.1 Chapter I: General Provisions 81
14.2 Chapter II: Confirmation and Measurement 81
14.3 Chapter III: Disclosure 83
14.4 Comments 84
14.5 Examples 85
15 Accounting Standards for Business Enterprises No. 11—Share-Based Payments 86
15.1 Chapter I: General Provisions 86
15.2 Chapter II: The Equity-Settled Share-Based Payments 87
15.3 Chapter III: The Cash-Settled Share-Based Payments 88
15.4 Chapter IV: Disclosure 88
15.5 Comments 89
15.6 Examples 90
16 Accounting Standards for Business Enterprises No. 12—Debt Restructuring 91
16.1 Chapter I: General Provisions 91
16.2 Chapter II: Accounting Treatment of Debtors 91
16.3 Chapter III: Accounting Treatments of the Creditor 92
16.4 Chapter IV: Disclosure 93
16.5 Comments 93
16.6 Examples 94
17 Accounting Standards for Business Enterprises No. 13—Contingencies 95
17.1 Chapter I: General Provisions 95
17.2 Chapter II: Recognition and Measurement 95
17.3 Chapter III: Disclosure 97
17.4 Comments 97
17.5 Examples 98
18 Accounting Standards for Business Enterprises No. 14—Revenue 99
18.1 Chapter I 99
18.2 Chapter II: Revenue from Selling Goods 99
18.3 Chapter III: Revenue from Providing Labor Services 100
18.4 Chapter IV: Revenue from Abalienating the Right to Use Assets 102
18.5 Chapter V: Disclosure 102
18.6 Comments 103
18.7 Examples 104
19 Accounting Standards for Business Enterprises No. 15—Construction Contracts 105
19.1 Chapter I: General Provisions 105
19.2 Chapter II: The Split Up and Combination of Contracts 105
19.3 Chapter III: Contract Revenue 106
19.4 Chapter IV: Contract Costs 107
19.5 Chapter V: Recognition of Contract Revenue and Contract Costs 108
19.6 Chapter VI: Disclosure 109
19.7 Comments 110
19.8 Examples 111
20 Accounting Standards for Business Enterprises No. 16—Government Subsidies 112
20.1 Chapter I: General Provisions 112
20.2 Chapter II: Recognition and Measurement 112
20.3 Chapter III: Disclosure 113
20.4 Comments 114
20.5 Examples 114
21 Accounting Standards for Business Enterprises No. 17—Borrowing Costs 116
21.1 Chapter I: General Provisions 116
21.2 Chapter II: Recognition and Measurement 116
21.3 Chapter III: Disclosure 119
21.4 Comments 119
21.5 Examples 121
22 Accounting Standards for Business Enterprises No. 18—Income Taxes 122
22.1 Chapter I: General Provisions 122
22.2 Chapter II: Tax Base 122
22.3 Chapter III: Temporary Difference 123
22.4 Chapter IV: Recognition 123
22.5 Chapter V: Measurement 124
22.6 Chapter VI: Presentation 125
22.7 Comments 126
22.8 Examples 126
23 Accounting Standards for Business Enterprises No. 19—Foreign Currency Translation 128
23.1 Chapter I: General Provisions 128
23.2 Chapter II: Determination of Functional Currency 129
23.3 Chapter III: Accounting Treatment for Foreign Currency Transactions 130
23.4 Chapter IV: Translation of Foreign Currency Financial Statements 130
23.5 Chapter V: Disclosure 131
23.6 Comments 132
23.7 Examples 133
24 Accounting Standards for Business Enterprises No. 20—Business Combinations 134
24.1 Chapter I: General Provisions 134
24.2 Chapter II: Business Combinations Under Common Management 134
24.3 Chapter III: Business Combination Not Under the Same Management 135
24.4 Chapter IV: Disclosure 138
24.5 Comments 139
24.6 Examples 140
25 Accounting Standards for Business Enterprises No. 21—Leases 141
25.1 Chapter I: General Provisions 141
25.2 Chapter II: Classification of Leases 141
25.3 Chapter III: Accounting Treatments of Lessees in Finance Leases 143
25.4 Chapter IV: Accounting Treatments of Lessors in Finance Leases 144
25.5 Chapter V: Accounting Treatments of Lessees in Operating Leases 145
25.6 Chapter VI: Accounting Treatments of Lessors in Operating Leases 145
25.7 Chapter VII: Sale and Leaseback Transactions 145
25.8 Chapter VIII: Presentation 146
25.9 Comments 147
25.10 Examples 148
26 Accounting Standards for Business Enterprises No. 22—Recognition and Measurement of Financial Instruments 150
26.1 Chapter I: General Principles 150
26.2 Chapter II: Classification of Financial Assets and Financial Liabilities 152
26.3 Chapter III: Embedded Derivative Instruments 156
26.4 Chapter IV: Recognition of Financial Instruments 157
26.5 Chapter V: Measurement of Financial Instruments 158
26.6 Chapter VI: Impairment of Financial Assets 161
26.7 Chapter VII: Determination of the Fair Value 164
26.8 Chapter VIII: Definition of Financial Assets, Financial Liabilities, and Equity Instruments 167
26.9 Comments 168
26.10 Examples 170
27 Accounting Standards for Business Enterprises No. 23—Transfer of Financial Assets 171
27.1 Chapter I: General Provisions 171
27.2 Chapter II: Recognition of Transfer of Financial Assets 171
27.3 Chapter III: Measurement of Transfer of Financial Assets 174
27.4 Comments 178
27.5 Examples 178
28 Accounting Standards for Business Enterprises No. 24—Hedging 180
28.1 Chapter I: General Principles 180
28.2 Chapter II: Hedging Instruments and Hedged Items 181
28.3 Chapter III: Recognition and Measurement of Hedging 183
28.4 Comments 188
28.5 Examples 190
29 Accounting Standards for Business Enterprises No. 25—Direct Insurance Contracts 191
29.1 Chapter I: General Provisions 191
29.2 Chapter II: Determination of Original Insurance Contracts 192
29.3 Chapter III: The Income from Original Insurance Contracts 192
29.4 Chapter IV: Reserves for Original Insurance Contracts 193
29.5 Chapter V: Cost of Original Insurance Contracts 194
29.6 Chapter VI: Presentation 196
29.7 Comments 196
29.8 Examples 197
30 Accounting Standards for Business Enterprises No. 26—Reinsurance Contracts 200
30.1 Chapter I: General Principles 200
30.2 Chapter II: Accounting Treatment of Ceded-Out Business 200
30.3 Chapter III: Accounting Treatment of Ceded-In Business 202
30.4 Chapter IV: Presentation 203
30.5 Comments 204
30.6 Examples 205
31 Accounting Standards for Business Enterprises No. 27—Exploitation of Petroleum and Natural Gas 208
31.1 Chapter I: General Provisions 208
31.2 Chapter II: Accounting Treatments of Rights and Interests of Mining Areas 208
31.3 Chapter III: Accounting Treatments of Oil and Gas Exploration 211
31.4 Chapter IV: Accounting Treatments of Oil and Gas Development 212
31.5 Chapter V: Accounting Treatments for the Oil and Gas Production 213
31.6 Chapter VI: Disclosure 214
31.7 Comments 215
31.8 Examples 216
32 Accounting Standards for Business Enterprises No. 28—Changes of Accounting Policies and Accounting Estimates and Error Correction 217
32.1 Chapter I: General Provisions 217
32.2 Chapter II: Accounting Policies 217
32.3 Chapter III: Changes in Accounting Estimates 219
32.4 Chapter IV: Corrections of Prior Period Errors 219
32.5 Chapter V: Disclosure 220
32.6 Comments 221
32.7 Examples 222
33 Accounting Standards for Business Enterprises No. 29—Events After the Balance Sheet Date 223
33.1 Chapter I: General Provisions 223
33.2 Chapter II: Adjusting Events After the Balance Sheet Date 223
33.3 Chapter III: Non-adjusting Events After the Balance Sheet Date 224
33.4 Chapter IV: Disclosure 225
33.5 Comments 225
33.6 Examples 226
34 Accounting Standards for Business Enterprises No. 30—Presentation of Financial Statements 227
34.1 Chapter I: General Provisions 227
34.2 Chapter II: Basic Requirements 227
34.3 Chapter III: Balance Sheets 229
34.4 Chapter IV: Profit Statements 231
34.5 Chapter V: Statements of Changes in the Owner’s Equities 232
34.6 Chapter VI: Notes 232
34.7 Comments 233
34.8 Examples 235
35 Accounting Standards for Business Enterprises No. 31—Cash Flow Statements 239
35.1 Chapter I: General Provisions 239
35.2 Chapter II: Basic Requirements 239
35.3 Chapter III: Cash Flows Arising from Operating Activities 240
35.4 Chapter IV: Cash Flows Arising from Investing Activities 241
35.5 Chapter V: Cash Flows Arising from Financing Activities 241
35.6 Chapter VI: Disclosure 242
35.7 Comments 243
35.8 Examples 244
36 Accounting Standards for Business Enterprises No. 32—Interim Financial Reporting 246
36.1 Chapter I: General Provisions 246
36.2 Chapter II: Contents of Interim Financial Reports 246
36.3 Chapter III: Recognition and Measurement 249
36.4 Comments 250
36.5 Examples 251
37 Accounting Standards for Business Enterprises No. 33—Consolidated Financial Statements 252
37.1 Chapter I: General Provisions 252
37.2 Chapter II: Introduction 252
37.3 Chapter III: Consolidation Procedures 253
37.3.1 Consolidated Balance Sheet 254
37.3.2 Consolidated Income Statement 255
37.3.3 Consolidated Cash Flow Statement 257
37.3.4 Consolidated Statement of Changes in Owner’s Equity 257
37.4 Chapter IV: Disclosure 258
37.5 Comments 259
37.6 Examples 260
38 Accounting Standards for Business Enterprises No. 34—Earings per Share 263
38.1 Chapter I: General Provisions 263
38.2 Chapter II: Basic Earnings per Share 263
38.3 Chapter III: Diluted Earnings per Share 264
38.4 Chapter IV: Presentation 265
38.5 Comments 266
38.6 Examples 267
39 Accounting Standards for Business Enterprises No. 35—Segment Reporting 268
39.1 Chapter I: General Provisions 268
39.2 Chapter II: Identification of Segments 268
39.3 Chapter III: Identification of Reportable Segments 269
39.4 Chapter IV: Identification of Primary and Secondary Reportable Segments 270
39.5 Chapter V: Segment Information Disclosure 271
39.6 Comments 272
39.7 Examples 273
40 Accounting Standards for Business Enterprises No. 36—Related Party Disclosures 274
40.1 Chapter I: General Provisions 274
40.2 Chapter II: Affiliated Parties 274
40.3 Chapter III: Affiliated Party Transaction 275
40.4 Chapter IV: Disclosure 276
40.5 Comments 277
40.6 Examples 278
41 Accounting Standards for Business Enterprises No. 37—Presentation of Financial Instruments 279
41.1 Chapter I: General Provisions 279
41.2 Chapter II: Presentation of Financial Instruments 280
41.2.1 Liabilities and Equity 280
41.3 Compound Financial Instruments 281
41.3.1 Settlement in the Enterprise’s Own Equity Instruments 282
41.4 Treasury Shares 282
41.5 Offsetting a Financial Asset and a Financial Liability 282
41.6 Chapter III: Disclosure of Financial Instruments 283
41.7 Balance Sheet 284
41.7.1 Income Statement and Statement of Changes in Owner’s Equity 286
41.8 Other Disclosures 286
41.9 Nature and Extent of Risks Arising from Financial Instruments 288
41.10 Comments 291
41.11 Examples 293
42 Accounting Standards for Business Enterprises No. 38—Initial Implementation of Accounting Standards for Enterprises 294
42.1 Chapter I: General Provisions 294
42.2 Chapter II: Recognition and Measurement 294
42.3 Chapter III: Presentation 297
42.4 Comments 298
42.5 Examples 299
43 Accounting Standards for Business Enterprises 2014 301
43.1 Accounting Standards for Business Enterprises Reviewed in 2014 301
43.1.1 Accounting Standards for Business Enterprises No. 33—Consolidated Financial Statements 301
43.1.2 Accounting Standards for Business Enterprises No. 35—Segment Reporting 302
43.1.3 Accounting Standards for Business Enterprises No. 37—Presentation of Financial Instruments 302
43.2 New Accounting Standards for Business Enterprises Added in 2014 303
43.2.1 Accounting Standards for Business Enterprises No. 39—Fair Value 303
43.2.1.1 Chapter I: General Provisions 303
43.2.1.2 Chapter II: Covers the Underlying Asset or Liability 304
43.2.1.3 Chapter III: Orderly Trading and Market 304
43.2.1.4 Chapter IV: Market Participants 305
43.2.1.5 Chapter V: Initially Measured at Fair Value 306
43.2.1.6 Chapter VI: Valuation Techniques 307
43.2.1.7 Noted in Chapter VII of the Fair Value Hierarchy 309
43.2.1.8 Chapter VIII: Fair Value of Non-financial Assets 310
43.2.1.9 Chapter IX: Liabilities Measured at Fair Value and Their Own Equity Instruments 312
43.2.1.10 Chapter X: Market Risk or Credit Risk Can Be Offset by the Fair Value of Financial Assets and Financial Liabilities 313
43.2.1.11 Chapter XI: Disclosure of the Fair Value 314
43.2.2 The Provisions of Chapter XII of Convergence 316
43.2.2.1 Chapter XIII: Supplementary 316
43.3 Summary 317
43.3.1 Accounting Standards for Business Enterprises No. 40—Joint Venture Arrangements 317
43.3.1.1 Chapter I: General Provisions 317
43.3.1.2 Chapter II: The Identification and Classification of the Joint Venture Arrangements 318
43.3.1.3 Chapter III: Accounting Treatment of Participants 319
43.3.1.4 Chapter IV: Accounting Entries for Joint Venture Participants 320
43.3.1.5 Chapter V: Cohesion Provisions 320
43.3.1.6 Chapter VI: Supplement 321
43.4 Summary 321
43.4.1 Accounting Standard for Business Enterprises No. 41—Disclosure of Interest 322
43.4.1.1 Chapter I: General Provisions 322
43.4.1.2 Chapter II: The Disclosure of Important Judgment and Assumption 323
43.4.1.3 Chapter IV: The Disclosure of Equity in Common Operation Arrangement or Joint Venture 325
43.4.1.4 Chapter V: The Disclose of Equity in the Structural Subject that Excludes from Consolidated Financial Reports 326
43.4.1.5 Chapter VI: Connection Provision 327
43.4.1.6 Chapter VII: Supplement 327
43.5 Summary 327
44 Erratum to: Accounting Standards for Business Enterprises No. 20–Business Combinations 329
Erratum to:& #6
References 330