Accounting Standards for Business Enterprises No. 28 - Changes in Accounting Policies and Estimates and Correction of Errors
Accounting Standards for Business Enterprises No. 28 - Changes in Accounting Policies and Estimates and Correction of Errors
Accounting Standards for Business Enterprises No. 28 - Changes in Accounting Policies and Estimates and Correction of Errors
Cai Kuai [2006] No. 3
February 15, 2006
Chapter I General Provisions
Article 1 In order to regulate the application of enterprise accounting policies, the changes in accounting policies, the recognition and measurement of changes in accounting estimates and the correction of errors in prior periods, as well as the disclosure of relevant information, this Standard has been formulated in accordance with the Enterprise Accounting Standard - Basis Standard.
Article 2 The effect of the changes in accounting policies and the corrections of errors in prior income tax periods shall be governed by the Enterprise Accounting Standards No.18 - Income Tax.
Chapter II Accounting Policies
Article 3 An enterprise shall select and apply the same accounting policies for identical or similar transactions or events, unless it is otherwise provided by other accounting standards.
The term "accounting policies" refers to the specific principles and basis of accounting treatment methods adopted by an enterprise for accounting recognition, measurement and reporting.
Article 4 The accounting policies adopted by an enterprise shall be consistent for each accounting period and for prior and subsequent accounting periods, and shall not be changed randomly. However, a change in accounting policy may be made in either of the following circumstances:
1. The change is required by any law, administrative regulation, or national uniform accounting system; or
2. The change in accounting policy will provide more reliable and relevant accounting information.
Article 5 The following are not considered changes in accounting policies:
1. A new accounting policy adopted for transactions or events occurring in the current period that are substantially different to those occurring in prior periods; and
2.
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