Accounting in Hong Kong SAR

Overview by Globlatrade.net:

Accounting System

Accounting Standards: Not having the force of law, the notification elaborated by the HK Public Accountants Association (Financial Reporting Standards Committee) determines the guideline to be considered for the interpretation and application of the accounting principles and which should be followed in this regard by the members of the profession.
Hong Kong Accounting Standards (HKAS)
Accounting Regulation Bodies: HK Institute of Certified Public Accountants
Accounting Law: Accounting in Hong Kong is regulated by the HKICPA under the control of "Professional Accountants Ordinance" (Chapter 50, Laws of Hong Kong). Company Audit is regulated by Company Ordinance (Chapter 32, Laws of Hong Kong) and Securities and Futures Ordinance.
Difference Between National and International Standards (IAS/IFRS): The HKFRS standards set out the basic principles which the auditors should follow. These standards are equivalent to the IFRS accounting standards.

Tax Year: The financial year starts on 1st January and ends on 1st April.
Accounting Reports: BALANCE SHEET: on December 31 n, to be compared December 31 n-1 FIXED ASSETS CURRENT ASSETS Stocks Marketable securities Debtors Cash CURRENT LIABILITIES Obligations under finance leases Proposed dividends Taxation Creditors Loans and bank overdrafts NET CURRENT ASSETS LONG TERM LIABILITIES Deferred taxation Obligations under finance leases Bank loans SHAREHOLDERS EQUITY Share capital Reserves Retained profits PROFIT AND LOSS ACCOUNT: 1) Turnover 2) Profit before tax 3) Tax 4) Retained profits at the beginning of the fiscal year 5) Dividends 6) Retained profits at the end of the fiscal year.
Publication Requirements: Annual Publication.

Accountants: The Hong Kong Institute of Certified Public Accountants is the sole organisation authorised to grant licenses to auditors and regulate the accounting profession in Hong Kong. This association governed by the Public Accountants Law(Professional Accountants Ordinance) maintains the register of its members and organises the exams for admission.
Professional Accountancy Bodies: The Institute of Financial Planners of Hong Kong
The Society of Chinese Accountants and Auditors
Association of Chartered Certified Accountants HK
Member of the International Federation of Accountants (IFAC): Hong Kong is a member of the International Federation of Accountants (IFAC).

Member of Other Federation of Accountants: Bilateral agreements with The Institute of Chartered Accountants in England and Wales, The Institute of Chartered Accountants of Scotland, The Institute of Chartered Accountants in Ireland, The Institute of Chartered Accountants of Australia, The Canadian Institute of Chartered Accountants, The New Zealand Institute of Chartered Accountants, The South African Institute of Chartered Accountants and The Institute of Chartered Accountants of Zimbabwe.
Audit Bodies: Companies have to seek a statutory auditor to conduct an annual audit of the financial health of their organization. You can contact KPMG, Ernst&Young, Pricewaterhouse coopers.

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