Circular of the Ministry of Finance on Printing and Distributing the Accounting Measures for Insurance Intermediary Companies

Circular of the Ministry of Finance on Printing and Distributing the Accounting Measures for Insurance Intermediary Companies

Cai Kuai [2004] No.10

September 20, 2004

To finance departments or bureaus in all provinces, autonomous regions, municipalities directly under jurisdiction of the Central Government and cities under separate state plans, the finance bureau of Xinjiang Production and Construction Corps, and the China Insurance Regulatory Commission:

For the purposes of standardizing the accounting of insurance intermediary companies and improving accounting information of insurance intermediary companies, and in accordance with the Accounting Law of the People's Republic of China, the Regulations on Business Enterprise Financial Reporting, the Enterprise Accounting System, and all other relevant laws and regulations of the state, the Accounting Measures for Insurance Intermediary Companies are hereby formulated by this Ministry, printed, distributed, and implemented as of January 1, 2005 in insurance intermediary companies that have adopted the Enterprise Accounting System. Please inform this Ministry of any questions arising during the course of implementation.

Appendix: Accounting Measures for Insurance Intermediary Companies

Article 1 General Instructions
1. For the purposes of unifying as well as standardizing the accounting of insurance intermediary companies and offering accurate and comprehensive accounting information of enterprises, in accordance with the Accounting Law of the People's Republic of China, the Regulations on Business Enterprise Financial Reporting, the Enterprise Accounting System, and all other relevant laws and regulations of the state, the Accounting Measures for Insurance Intermediary Companies (hereinafter referred to as "these measures") are specially formulated in combination with the features and actual conditions of insurance intermediary companies.
2. All insurance intermediary companies operating within the People's Republic of China shall implement these measures while implementing the Enterprise Accounting System.
An insurance intermediary institution as mentioned in these measures shall refer to an insurance agency, insurance brokerage institution or insurance public evaluation institution, which has obtained the requisite business permit upon approval from the China Insurance Regulatory Commission (hereinafter referred to as "CIRC"), and provides insurance intermediary services.
3. Insurance intermediary companies set up as organizations other than limited companies and limited liability companies shall refer to these measures while performing their routine business accounting. Accounting of funds provided by owners, running accounts with owners, etc., shall be prescribed separately.

Article 2 The Establishment of Supplementary Accounting Items and Application Instruction
1. The Establishment of Accounting Items
Theses measures in virtue of the Enterprise Accounting System add the following items: "refundable deposit", the two sub-items " advance premium" and "the advance expense" under "accounts receivable", the sub-item "the trusted collection of premium" under "accounts payable", the sub-item "cooperation business expense " under "other payables", the sub-items "commission income", "brokerage commission income", "consultant fee income" and "public evaluation fee" under "major business income", and also formulate supplementary regulations to the content of such accounting items.
　　......