chapter  2
16 Pages

Accounting in China: developments and opportunities

WithY. W. Tang, B. J Cooper, P. Leung

China is a huge country, where an estimated ten million people currently work in accounting-related occupations. China is also a fast developing country and its accounting profession is going through a period of rapid development. Accounting in China is very much influenced by the socio-economic environment in which enterprises operate, and, being a centrally controlled economy, accounting practices in China differ to a considerable extent from those of Western countries. Since the late 1980s, however, China has recognized the need for accounting reform. The uniform accounting regulations were no longer sufficient to meet the needs of investors and users of financial information. Some of the critical factors which have influenced accounting reform have been the diversification of business operations and ownership, the increasing complexity of business transactions, internationalization of economic activities, and the development of the accounting profession (Chow et ale 1994).