Laws of the Guangdong Province

Regulations of Shenzhen Municipality on Accounting

 (Adopted by the Thirteenth Meeting of the Standing Committee of the Third People' s Congress of Shenzhen Municipality on August 27,2004; Approved by the Thirteenth Meeting of the Standing Committee of the Tenth People' s Congress of Guangdong Province on September 24,2004)

Chapter I    General Provisions

    Article 1  In order to standardize accounting acts, ensure the truthfulness and completeness of the accounting materials, strengthen economic management and financial control, raise economic results and maintain the order of the socialist market economy, these regulations are hereby formulated according to the Accounting Law of the People' s Republic of China (hereinafter referred to as "Accounting Law" ) and provisions of other laws, regulations and basing on the facts of Shenzhen Municipality.

    Article 2  The state organs, social organizations, enterprises, institutions and other organizations (hereinafter referred to as "units" ) shall handle accounting affairs in accordance with these Regulations.

    Article 3  The person in charge of a unit shall be the principal part of the accounting liability, and shall be responsible for the accounting work as well as the truthfulness and completeness of the accounting materials.

    The person in charge of a unit referred to in the preceding paragraph refers to the legal representative of a unit or the major responsible person who is representing a unit in exercising functions and powers according to laws and regulations.

    Article 4 Accounting offices and accounting personnel shall, in accordance with the law, conduct accounting practice and exercise accounting supervision.

    No unit or person may, by any means, suggest, instruct or compel any accounting office or accountant to forge or alter any accounting document, accounting book or other accounting material or provide any false financial and accounting reports.

    Article 5  Any accountant shall, in handling of accounting affairs, abide by the principle of good faith and insist the accounting criterion to ensure the impersonality and fairness.

    Any accountant who performs his duty in accordance with the law shall be protected by the law and no unit or person is allowed to retaliate against them.

Article 6  All units shall establish a sound internal accounting control system.

Article 7  Financial departments of districts and municipality (hereinafter referred to as "municipal and district financial department" ) shall administer the accounting management in their respective administrative area, carry out  supervision and inspection the implementation of the accounting laws, rules and regulations, investigate and prosecute the illegal acts in accordance with the law, guide the work of the social audit and accounting consultation, and exercise other duties of the accounting supervision and management provided for by the relevant provisions of the state.

Chapter II  Accounting Organizations and Accounting Stuffs

Article 8  All units shall, according to the needs of the accounting affair, set up an accounting office or an accounting staff in a relevant office and designate a chief accountant. Where a unit which should have set up the account book according to the relevant law, regulations and the unified accounting system of the state but does not have conditions for establishing accountant staff, it shall entrust the accounting affair to the bookkeeping agency established upon approval.

The Municipal and district governments and their relevant departments may establish specialized agency on the basis of necessities to conduct centralized accounting practice on the institutions of administrative affair.

Article 9  All units shall set up accounting posts on the basis of necessities of accounting affair. The setup of the posts and separations of functions of the staffs shall be subject to the internal diversion system.

Article 10  Whoever engages in accounting work must obtain a professional accountant qualification certificate.

Whoever has not obtained the professional accountant qualification certificate is forbidden to engage in the accounting work.

The municipal and district financial department shall arrange the matters in respect of test for professional accountant qualification as well as grant, alteration, revoke and examination of the certificate in accordance with the law.

Article 11  Departments of audit, industrial and commerce, tax and the People' s Bank shall have the right to check the professional qualification certificate and relevant certificates of the accountant in the processing of the relevant affair.

Where a person who has not obtained the professional accountant qualification certificate is handling the accounting affair, the relevant deposit bank may not handle the subsistence of the seal card and the departments of finance or tax may not handle the receipt and purchase of the bills and tax registration.

Article 12  A person in charge of an administrative office or an accountant in charge in a unit shall, in addition to obtaining a professional accountant qualification certificate, have the professional title of certified accountant or above, or have engaged in accounting work for more than three years.

Article 13  The accountant shall participate in continuous education according to the provisions of the state. A unit shall, according to the relevant provisions of the state, guarantee the accountant to accept continuous education. The municipal and district financial departments shall arrange the accountants to participate in the continuous education and training and establish inspection and check systems of accountant' s continuous education in a planned way.

Those accountants who have not attended the continuous education according to the provisions shall be dealt with by the municipal and district financial department in accordance with the relevant provisions of the state.

Article 14  Accountants may set up industrial organization of self-discipline in accordance with the law. The industrial organization of self-discipline shall, in accordance with the relevant law, regulations and articles of association, maintain the legal rights and interests of the accounting industry and accountants, reprimand the acts against occupational codex and ethics, arrange academic study, work intercommunication and consultation service and accept the supervision and guidance of the municipal financial department.

Chapter III  Accounting Practice

Article  15  All units shall fulfill accounting practice, fill in and prepare accounting documents, record account book and work out financial statements according to the economic and business transactions actually taken place.

No unit may fulfill accounting practice basing on the untrue economic and business transactions or false materials.

Article 16  Accounting procedures shall be conducted and accounting be practiced with respect to the following economic and business transactions:

 (1)  Receipts and disbursements in case and in negotiable securities;

 (2)  Acceptance, delivery, increase, decrease and use of property;

 (3)  Occurrence and settlement of claims and debts;

 (4)  Increase and decrease of capital and funds;

 (5)  Computation of income and expenditure, expenses and costs;

 (6)  Computation and treatment of financial results; and

 (7)  Other transactions that are subject to accounting procedures and accounting practice.

Article 17  Accounting documents, account books and other accounting materials shall all comply with the unified accounting system of the state.

No unit or person may forge or alter any accounting documents, account books or other accounting materials, or submit any false financial accounting statement.

Any unit may, in accordance with its needs, choose the accounting practice software complying with its conditions. The software and the accounting documents, account books, accounting statements and other accounting materials produced therefrom shall comply with the provisions of the State' s unified accounting system.

Article 18  A unit shall establish accounting subjects according to the State' s unified accounting system, but it may make proper supplement, reduction or consolidation to the accounting subjects on the basis of the actual facts under the premises that no influence would be done to the requirements of accounting practice, the guideline collecting of the accounting statements or the external unified accounting statements.

Article 19  In handling the economic and business transactions specified in Article 16 of these Regulations, original documents shall be obtained or filled truthfully and legally, and be promptly submitted to the accounting office.

No office or person may provide or issue original documents of untruthfulness or illegality.

Article 20  Accounting office and accountant shall prepare the accounting vouchers on the basis of the examined and verified original documents and related materials. As to the paper accounting vouchers produced by the computer shall have signed or sealed by the manufacturer, auditor, bookkeeper and the person in charge of the accounting office (accountant in charge).

Article 21  Entries into account books shall be on the basis of the examined and verified accounting documents and comply with the provisions of relevant laws, regulations and the State' s unified accounting system.

All economic and business transactions take place in a unit shall be3 recorded and calculated in the account books set up according to law.

To establish accounts outside the account books or keep capital outside the account books are forbidden.

Article 22  All units shall establish regular property liquidation system and ensure the conformity between the records in the account books and the actual amount of property in kind money,

Liquidation shall be made to assets of all units prior to the preparation of the fiscal accounting statement. Where there is unconformity between the records of the account books and actual facts during the liquidation, cause shall be ascertained without delay and transaction shall be conducted in accordance with the related provisions.

Article 23  The accounting method used by a unit shall be consistent throughout all periods and may not b e changed arbitrarily; if it is necessary to change the method, it shall be changed according to the provisions of the State' s unified accounting system, and the cause for the change, the situation and impact of the change shall all be explained in the financial accounting statement.

Article 24  The financial statement shall be prepared on the basis of the fully registered, examined and verified records of the account books and other related materials, and shall comply with the requirements of the State' s unified accounting system, with exception that the ones prescribed separately by the law or regulations shall subject to the stipulations.

Where the unit which must prepare and consolidate the financial statement shall prepare in accordance with the provisions of the related laws, regulations and the State' s unified accounting system.

Any one may not suggest, instruct or compel other to sophisticate the financial statement or other accounting materials.

Article 25  The financial accounting statement shall be submitted to the related departments and units in accordance with the legal proceedings and time. If the accounting statements, notes to the accounting statements and explanations on financial conditions shall, as stipulated by related laws and regulations, be subject to auditing by a certified public accountant, the auditing report issued by the certified public accountant and the interested certified public accountant' s office shall be provided together with the financial accounting statement.

The financial accounting statement shall be signed and stamped by the person in charge of the unit, person in charge of the accounting work and the person in charge of the accounting office (or accountant in charge). If a unit has a chief accountant, it shall also be signed and stamped by the chief accountant.

All units shall provide the related parties with the financial accounting statement with consistency throughout its preparation base, preparation foundation, preparation principle and method, and the financial accounting statement of different preparation base, preparation foundation, preparation principle and methods shall not be provided.

Article 26  The archives, preservations, examinations, deliveries and destructions of the accounting documents, account books, financial accounting statement and other accounting materials shall comply with the related stipulations of the state.

Where the unit uses computer for the accounting practice, it shall ensure the security of the electronic accounting archives and shall keep records for the electronic archives. The more important electronic archives shall be preserved separately.

The accountant to leave or retire shall, in accordance with the stipulations, deliver the accounting archive and fulfill the hand-over procedure.

To conceal or intentionally destroy the accounting archives is forbidden.

Article 27  The formats of the accounting document, account book and accounting statement shall comply with the stipulations of the State' s unified accounting system and a unified supervision shall be made by the municipal financial department on their manufactures.

No unit or person may use accounting document, account book or accounting statement which have not been manufactured or supervised by the municipal financial department.

If computers are used for the accounting practice, the accounting documents, account books and accounting statement produced therefrom shall comply with the requirements of the municipal financial department on the unified accounting documents, account books and the accounting statement of the financial.

In fulfilling accounting practice, companies and enterprises may not commit any of the following acts:

 (1)  Arbitrarily changing the verification standards or computation method for their assets, liabilities and creditor' s rights, and falsifying the statement of their assets, liabilities and creditor' s rights by false statement, over-statement, no-statement or under-statement;

 (2)  False statement of or concealing their incomes, delaying or anticipating the verification of their incomes;

 (3)  Arbitrarily changing the verification standards or computation method for their expenses and costs, and falsifying the statement of their expenses and costs by false statement, over-statement, no-statement or under-statement;

 (4)  Arbitrarily adjusting the computation and distribution method for profits, conjuring up false profits or concealing profits; or

 (5)  Any other act violating the provisions of the State' s unified accounting system.

Chapter IV  Accounting Supervision

Article 29  All units shall establish internal accounting supervision and accept the external accounting supervision performed according to the law. The person in charge of the unit shall ensure its accounting offices and their accountants perform their duties according to the law, and shall not, by any means, suggest, instruct or compel any accounting office or accountant to conduct accounting affair illegally.

The unit may, in accordance with its needs, staff the underling units with accountants.

Article 30  Explicit opinion shall be subscripted by the person in charge of the unit or other authorized person in the subscription of the economic business affair. As to the inexplicit opinions on the matters of the economic business transactions, the accounting office and accountant shall re-subscript. If the re-subscripted opinion is still inexplicit or refused to be subscripted, the accounting office and the accountant shall have the rights to refuse the transaction.

Article 31  Where chief financial inspector or chief accountant is established in the solely state-owned enterprise, state-owned proprietary company, collective enterprise and institutions, his important economic business transactions shall perform the join-signature system of the person in charge of the unit with the chief financial inspector or chief accountant.

The important economic business transactions referred to in the preceding paragraph means the big overseas investment, establishment and purchase of the assets, assets disposal, capital transference, capital financing, foreign guarantee and other important economic business transactions.

Article 32  Each units shall, in accordance with its the business specialties and management requirements, establish internal accounting control system:

 (1)  Accountant and casher shall be established separately;

£¨2£©  A cashier shall not concurrently take charge of auditing, custody of accounting archives or recording revenue, expense or claims and liability accounts, and persons outside cashers shall not be in charge of cash, negotiable securities and bills;

 (3)  A unit' s obligating seal, disbursement code and important blank documents shall be preserved by different persons according to the stipulations;

(4)  The original document which has fulfilled the procedure of cashing shall be stamped with "Cash Paid (Received)" or "Bank Paid (Received)" on;

 (5)  Other accounting control systems established according to the laws.

Article 33  Where a unit has established many accounting posts, it shall have accounting posts in internal alternation in a planned way.

Article 34  Spouse, lineal descent, collateral consanguinity within 3 generations, lineal affinity of the person in charge of the unit or person in charge of the accounting office shall not hold posts in accounting work with exceptions of individual business, solely individual enterprise and exclusively foreign-owned enterprise.

Article 35  The account-filing person from the unit which is brought into the collective accounting shall not deal in economic business transactions. Where there is a necessity, written certificate on the truthfulness of the economic business transactions shall be issued by the related persons of the unit.

Article 36  A unit which is prescribed by the law to have certified accountant  conduct auditing shall entrust an accounting firm to conduct auditing. Where a unit financially sponsored by the government is choosing accounting firm, it shall invite or offer bids in accordance with the law.

Where the certified public accountant is conduct auditing for a unit, it shall comply with the state' s unified accounting system, and shall not collude or engage in irregularities for favoritism with the unit, falsify or modify the accounting documents, account books and financial accounting statement or other accounting materials. The audit reports issued shall comply with the prescribed procedure and requirements.

The financial department shall have right to supervise and check the procedure, content and quality of the preparation of accounting firm' s audit report, and to supervise and check and practicing rules and criterion of professional ethics of the certified public accountants.

Article 37  Where a unit to be audited accept the auditing of the certified public accountants, it shall offer in time and according to the facts the accounting documents, account books, financial accounting statements, other accounting materials and related conditions.

No unit or individual is allowed to by any means require or suggest the certified public accountants to issue false or inappropriate audit reports, or to pay less or refuse to pay for the commission fee in case that the certified public accountant issue reports showing no or negative opinions.

Article 38  Any unit or individual shall report offenses of violating law, rules, regulations to financial departments of municipality and district. Where the municipal and district financial departments receives the reports, it shall investigate and handle in time and in accordance with its functions and powers, keep secret for the reporters, and shall not transfer the reporters' names and report materials to the unit and individuals being reported.

The related supervisory and inspection departments shall exercise key supervision and inspection on the units and individuals who retaliated the reporters, and shall have the power to publish the inspection results.

Article 39  The financial department, competent department of business and all units shall have `regular checks on the accountants' abidance of the professional ethics which will serve as the important assessment foundations for the promotions, employment of the professional positions, honors and awards of the accountants.

Article 40  The financial department shall jointly with the related departments establish the accounting good faith documents, recording the breaks of faith, illegal acts and the punishments of the unit and accountants. In case the circumstance is serious, it shall be disclosed in time.

The financial department shall enhance the supervision and inspection on the good faith circumstances of the unit and the accountants, and offer query service on the good faith materials of the related accounting organizations and accountants for the society and other law enforcement departments.

Article 41  The municipal and district governments and their financial departments shall enhance the organizational harmony of the accounting supervision and inspection.

Departments in charge of auditing, taxation, bank regulatory, securities regulatory shall, in accordance with the duties and functions specified by the relevant laws and regulations, exercise supervision over and conduct inspection of the accounting materials of the related units.

If the inspection conclusion made by a supervisory and inspection department is sufficient to meet the requirements of other supervisory and inspection departments for performing their duties and functions, the other supervisory and inspection departments shall make use of the conclusion and shall avoid making repeated account inspection and verification.

Article 42  All units must, in accordance with the provisions of relevant laws and administrative regulations, accept the supervision and inspection conducted according to the law by the relevant supervisory and inspection departments and honestly furnish accounting documents, account books, financial accounting statements and other accounting materials and relevant situations, and may not refuse inspection, conceal materials or report falsely.

In the supervision of the exercising of the accounting law, regulations and rules, the related departments and units shall render support. If there is suspicion of serious law-violation, the financial department may make inquiries of the units which have economic and business transactions with the unit under supervision, and units involved shall render supper.

Article 43  Departments and their personnel exercising supervision over and conducting inspection of the accounting materials of the related units according to law have the obligation to keep confidential all State secrets and commercial secrets that come to their knowledge in their supervision and inspection.

Chapter V  Bookkeeping Agencies

Article 44  To establish bookkeeping agencies shall comply with the conditions prescribed by the state and shall be approved according to the law.

Article 45  The bookkeeping agency shall, in accordance with the law, conduct accounting practice for the consignee, offer financial accounting statement and financial accounting consultation service, provide the taxation department with the tax materials, undertake other accounting business entrust by the consignee.

Where the bookkeeping agency accepts the consigned accounting affair, the true and legal bookkeeping agency permit shall be shown by the agency to the consignees.

Article 46  The municipal financial department shall exercise supervision and inspection on the circumstances of the bookkeeping agency on its work.

The bookkeeping agency shall submit the following materials to the municipal financial department prior to every year' s April 30th:

 (1)  Business license, permit of bookkeeping agency;

 (2)  Certificates of official address and house property rights or using rights of the office;

 (3)  List of the employed, identifications of the employed, certificates of professional accountant qualifications, certificates of technical accountant competence;

 (4)  Accounting statements of the bookkeeping agency;

 (5)  Other materials prescribed by the law, rules and regulations.

Article 47  The bookkeeping agency shall suspend its business in case it fails to meet the establishing conditions because of the change of the employed after its establishment. It shall report to the municipal financial department, apply for alteration or complement of the conditions within 30 days. Where the agency fails to meet the prescribed conditions, it shall wind up it business.

Article 48  The bookkeeping agency shall enhance its business management and establish sound internal management system to ensure the work quality and keep away the risks, and shall not conduct the followings:

 (1)  To develop business without complying with the provisions of the Accounting Law and the unified accounting system;

 (2)  To compete with other bookkeeping agencies and accountant firms for business by the means of malfeasant methods like malicious reduction of charging or defaming the crafts;

 (3)  To pay other units or individuals the recommendation fee for business directly or in disguised form;

 (4)  To operate business with other units or individuals by income division or offering for subordinating;

 (5)  To intimidate, deceive, favorably seduce consignors or other units and individuals;

 (6)  To convey bookkeeping agency permit or collect commission charges by accepting and handling accounting business on behalf of the unqualified organizations;

 (7)  Not to accept the legal supervision and check of the municipal financial department in accordance with the provisions;

 (8)  Other acts going against the law and rules

Article 49  The bookkeeping consignor shall conclude written contract of mandate with the bookkeeping agency. The contract shall not only have the common items of a contract, but also specify the following items:

 (1)  Liabilities of legality, trueness, accuracy, completeness of the accounting materials that should be undertaken by two parties;

 (2)  Transmission and signing-in procedures of the accounting documents;

 (3)  Requirements of preparing and offering financial accounting reports;

 (4)  Preserving requirements of the accounting archives.

Article 50  Where consignor entrusts the bookkeeping agency with the accounting bookkeeping, he shall offer legal, true, complete and original documents and other relevant materials to the agency in time. As to the original documents required to be modified or supplemented by the agency, the consignor shall make modification or supplement in time.

The bookkeeping agency and its staff shall conduct accounting practice according to the State' s unified accounting system on the basis of the true, legal and original documents and other relevant materials offered by the consignor. The financial accounting report prepared for the consignor shall be signed and stamped with units' stamps after the check and approval of the persons in charge of the agency and the consignor.

Article 51  The consignor shall undertake liabilities for the acts of bookkeeping agency prescribed in the contract of mandate.

The bookkeeping agency shall undertake the liabilities for the business activities of its professional and part-time staff.

Chapter VI  Legal Liabilities

Article 52  A unit which employs accounting personnel who have not obtained the professional accountant qualification certificate in violation of the provision of Item 2 of Article 10, shall be ordered by the financial department to make a rectification within a specific time limit, and may receive a fine of not less than RMB 10,000 yuan but not more than RMB 50,000 yuan. The person-in-charge and other personnel held directly responsible shall be given a fine of not less than RMB 3,000 yuan but not less than RMB 20,000 yuan.

Article 53  Any unit who is in violations of the provisions of the Article 12, Paragraph 2 Article 26, Paragraph 3 Article 26, Article 27, Article 31, Article 32, Article 33, Article 34, Article 35, Article 50, shall be ordered by the financial department to make a rectification within a specific time limit; if it fails to rectify within the time limit, a notice shall be circulated by the financial department.

Article 54  Where a unit keep unlisted capital by violating the provision of Paragraph 3 Article, it shall be announced to the public; as to the administrative units, its unlisted capital shall be confiscated; as to the one violating the tax law and rules, it shall be transmitted to the tax department for transaction.

Article 55  Where a unit fails to perform the duties of investigation and transaction or the secrecy obligations by violating the provisions of Article 38 and Article 43, the person directly responsible shall be investigated into the legal liabilities in accordance with the law.

Article 56  In case the agency engages in the bookkeeping business without gaining the bookkeeping permit by violating the provision of Article 44 of these Regulations, a notice will be circulated by the financial department, and the agency will be transacted in accordance with the relevant provisions of the state.

Article 57  Where a party fails to submit to the specific administrative acts of the financial department, he may apply for reconsideration or institute an administrative lawsuit in accordance with the law.

Article 58  Where the financial department and its personnel fail to exercise their duties and functions of supervision and management according to these Regulations, person in charge and other personnel held directly responsible shall be given administrative punishment in accordance with the law.

Where the staff of the financial department abuse their power, neglect their duties, practice favoritism or irregularity, they shall be given administrative sanctions in accordance with the law. If the offences constitute a crime, they shall be investigated for their criminal responsibilities according to the law.

Chapter VII  Supplemental Provisions

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Article 59  The municipal financial department may, in accordance with the provisions of Paragraph 3 Article 10, Paragraph 2 Article 27 and Article 33 of these Regulations, formulate the specific methods for management.

Article 60  Branches of foreign companies within the municipal administrative area shall conduct the accounting work in accordance with these Regulations.

Article 61  Where the circumstances have not been subscribed by these Regulations, they shall be handled in accordance with the provisions of the Accountant Law and other relevant laws, rules and regulations.