[Legal News] Updated Accounting Law
2024. 7. 26
The revised Accounting Law, adopted at the 10th meeting of the Standing Committee of the 14th National People’s Congress on June 28, came into effect on July 1. This revision, which underwent two reviews in April and June 2024, marks the first amendment in 25 years since the law was established in 1985 and subsequently revised in 1993, 2017, and 1999. According to the Legislative Affairs Commission of the NPC Standing Committee, the current revision focuses on maintaining the existing basic system while addressing significant issues in accounting practices, strengthening accounting supervision, imposing stricter penalties for illegal activities, improving the quality of accounting information, and protecting social interests.
The fines for fraudulent accounting have been increased from several thousand or tens of thousands of yuan to millions of yuan, with no upper limit on corporate fines, which can be up to ten times the illegal income. The maximum fines for illegal activities such as falsifying accounting documents, altering accounting books, and creating false financial accounting reports have been raised from 100,000 CNY to ten times the illegal income. If false financial accounting reports are instructed to be created, the maximum fine has been increased from 50,000 CNY to 5 million CNY.
Additionally, the Chinese character “帳” in relevant provisions has been changed to “賬”. For example, “Accounting books must be established in accordance with the law” (Article 3), “Renminbi is the recording currency for accounting purpose.” (Article 12), and “Accounting vouchers include original vouchers and bookkeeping vouchers” (Article 14) have been revised accordingly.
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