China Accounting Services
China Company Accounting, Bookkeeping, Tax & Audit Services.
Treasury and Banking:
Invoice and Accounts Receivable Management:
Accounting Virtual CFO Services
Solid financial and accounting management are important for every company. However, these can be challenging tasks for many organizations in China. Cultural differences and language barriers with local employees, differing procedures and policies applied by local authorities, and the rapid change in regulations due to the continuous national reform make it challenging to coordinate local operations with a head office based in a different country. Such challenges are further compounded by the presence of country specific accounting reporting standards.
Acadia Advisory can play a key role in overcoming these challenges by providing customized Virtual CFO (“VCFO”) solutions and addressing differing regulatory standards in China depending on the needs of your Chinese subsidiary. Acadia can mitigate uncertainties faced by local
subsidiaries and manage risks prevalent in any Chinese business environment. With our VCFO services clients can expect to receive pragmatic advice and solutions relating to accounting, tax, internal control, and compliance considerations. This will allow clients to focus on growing their core business rather than spending valuable time trying to resolve complex regulatory challenges on their own.
By including a myriad of integrated solutions under our VCFO service offering, Acadia seeks to address the commercial needs of our client’s businesses while adhering to the highest professional standards.
Accounting Bookkeeping in China
All foreign-invested companies in China are required to prepare annual financial statements, including balance sheets and income statements for their annual Chinese audit (conducted by a CPA registered in China). RMB is the base currency used for ledgers and financial reports. For companies using currencies other than RMB in their business transactions, that foreign currency can be used as the bookkeeping base currency. However, the financial reports are required to be shown in RMB. Furthermore, accounting records have to be maintained in Chinese. Foreign-invested companies can use only Chinese in financial reports for regulatory reporting purposes, companies can choose to convert the Chinese financial reports to internal management reports in other languages for group reporting purposes.
Companies in China should adopt the accrual basis of accounting in performing recognition, measurement and reporting for accounting purposes. Foreign-invested companies, including their legally responsible persons, must take full responsibility for the truthfulness, legitimacy and completeness of financial statements. These statements will be used for computing the taxable and distributable profits of the business. Books and records have to be retained for at least 15 years under Chinese law.
Fapiao Invoice Management
According to PRC law, any business transaction carried out in Mainland China requires a fapiao. More than just an official receipt with a distinctive red oval seal, a fapiao is a tax invoice designed to ensure the government receives tax payment. A significant portion of small to medium-sized companies conduct certain sales under the table and remain reluctant to issue fapiaos since they are liable for taxes on profits for all transactions in which a fapiao is issued. However, for those purchasing goods and services, fapiaos are essential for claiming value-added tax refunds and lowering tax liability.
Acadia provides invoicing solutions for companies or individuals that need to invoice their clients. We issue Fapiao invoices to your clients on your behalf, we also provide daily custodian and management services on company fapiaos, making sure your company always has access to a sufficient supply of fapiaos. Simply let us know the name of the client, how much they need to pay, and we take care of the rest.
Cash Management and Treasury Services
Senior managers within a company can make better business decisions if they have an in-depth understanding of their cash flows and cash positions. As an available option in our VCFO Services package, Acadia helps maintain and implement practical cash and treasury management services. By actively participating in our clients’ cash and treasury functions, we have a proven track record in helping our clients better understand their ongoing cash situations and optimizing their cash flow.
These services include:
- Evaluate monthly minimum petty cash payments with company management
- Monitor the periodic withdrawal of petty cash by local cashier based on approvals from the company’s authorized person(s)
- Reconcile cash counts to tally cash on hand with petty cash records
- Provide Accounts Payable Services/Expense Reimbursement Services
- Collect payment/reimbursement requests on a periodic basis.
- Obtain mandatory written confirmations/approvals prior to disbursement
Treasury/Bank Support Services
- Maintain and protect bank account access key and passwords
- Keep a registry of all bank accounts of the company.
- Monitor the cash-flow of the company and make fund request(s) with overseas head-office when necessary, monthly bank reconciliation
- Ensure payments on behalf of the company are in accordance with agreed upon payment schedules.
Setup of Chart of Accounts and Standard Operating Procedures
As part of Acadia’s VCFO Services package, we help design and implement a customized set of accounting, finance and tax related standard operating procedures and processes suited to the operating considerations of our clients while also considering the need to adhere to Chinese accounting and tax regulations.
Through this, our clients will be able to understand the general accounting and bookkeeping and tax requirements of the PRC, banking and treasury related processes, key reporting obligations of the company by its directors, and a variety of best practices adopted by different companies operating in China prior to the commencement of operations.
For clients that have been operating in China for several years, introducing Acadia’s VCFO Services could be a good way to also enhance and upgrade current processes and internal control practices. This helps mitigate regulatory risks that could arise from outdated procedures that are currently in place.
A short summary of the accounting services that Acadia Advisory can provide you:
- Advising on design/revision, implementation of a customized set of Accounting, Finance, Tax Standard Operating Procedures (SOPs) that the company would be faced with on a regular basis.
- Advising on design/revision implementation of a set of banking and treasury related SOPs with emphasis on internal control.
- Setting up a client’s Chart of Accounts in accordance with PRC GAAP.
- Setting up a client’s management accounts for reporting purposes based on the requirements set by overseas headquarters.
Schedule a China Accounting Services Consultation
Schedule a China accounting consultation with Acadia Advisory to discuss our China accounting services and learn more about how we can assist your company in China.