Introduction to The Chinese Accounting Standards
The Chinese accounting system follows the Chinese Generally Accepted Accounting Principle (GAAP) framework, also known as the Chinese Accounting Standards (CAS). These standards have been revised regularly and evolved over time, and now they are quite in accordance with the globally recognized International Financial Reporting Standards (IFRS) & US GAAP. Despite the several reforms, changes still exist to pose challenges.
Hiring and locating professional accountants who knows the domestic regulations and laws in your own company can be costly. In this case, outsourcing bookkeeping and accounting affairs to an experienced service provider becomes an ideal choice, especially for small and medium-scale companies who expects to spend more money and energy on business running.
Why Outsource Your Company's Bookkeeping to Hongda?
There are some general cases when companies prefer outsourcing their bookkeeping and accounting affairs to professional service providers instead of hiring in-house accountants.
- A global company has just registered in China and does not have enough time to hire their own qualified in-house accountants. In this case, the company will find an agency to provide bookkeeping and tax declaration services to ensure that the company is in accordance with regulations.
- The company’s scale is small, and the financial process framework is relatively simple. Therefore, it is not necessary to have a financial department based on the consideration of saving budget and reducing the number of staff.
- Small and medium-sized companies or self-employed individuals generally do not meet the criteria for hiring full-time financial accountants. The aforementioned business entities will choose bookkeeping companies to carry out financial recording on their behalf.
Outsourcing your bookkeeping to Hongda will also bring you business advantages when operating your company in China. You surely can:
- Save on the labor cost of the enterprise: if a company recruits a bilingual accountant, the monthly salary will be more than 10 thousand yuan, and the salary of senior accountants and foreign trade accountants can be even higher. In cooperation with Hongda, you can enjoy higher-quality, more professional financial and tax consulting with a much lower price, without the risk of facing labor disputes.
- Ease the administrative burden: in addition to paying salaries, a qualified accountant also needs to pay social insurance for employees and other payroll benefits. However, if you choose Hongda as your business partner, it can effectively alleviate the additional burden on your company.
- Enjoy immediate and precise tax declaration: if the company’s financial accounting and tax declarations are reported indiscriminately, underreported, or late, the liability and property losses must be borne by the company itself. However, if the loss is caused by Hongda, we will generally undertake the commitment and compensate.
- Hongda is always neutral and takes the obligation of confidentiality to directly communicate with the overseas headquarters
Why Hongda is Better? - Factors to Remember
There are a number of bookkeeping companies in the market. Choosing the right partner to work with not only helps you keep compliance with the financial requirements and regulations but also gives you a good opportunity to save energy and budget. By cooperating with an experienced bookkeeping firm, you can also get the chance to know the health of your financial status by real-time information and updates.
Still unsure about how to choose the best bookkeeping agency for your company? Here are the main factors that you should consider and what makes Hongda outstand from other competitors.
1. Does the firm hold bookkeeping qualifications?
To provide bookkeeping service to clients, the company must obtain the bookkeeping qualification first. You can require the firm to present the business license and bookkeeping qualification license approved by the local Finance Bureau for assessment.
Why Hongda: Hongda has met all the requirements and qualifications for providing bookkeeping services to our clients. You can ask for a copy of related qualification licenses anytime for confirmation. In addition, Hongda was selected as the vice president unit of the Shenzhen Agency Bookkeeping Association in 2021. Hongda was also rated as an A-level accounting service institution by the government.
2. Does the agency have experienced full-time financial personnel?
Some companies would hire part-time financial staff to provide services to clients due to cost considerations, which will reduce the quality and stability of services.
Why Hongda: Hongda has built a strong accountant team. Many of our financial team members hold certificate of tax agent or senior accountant certificates. They have worked with proven experience in the field for more than 10 years. Our highly experienced financial specialists value your financial status as much as you do and are determined to provide stable financial records for you.
3. Does the company present foreign service capabilities?
Most bookkeeping outsourcing firms mainly focus on serving domestic companies and may lack the ability to fulfill the requirements of foreign companies. In addition, the ability to speak English is also something you must consider when it comes to reporting the financial records to your overseas headquarter.
Why Hongda: Hongda has been working with foreign investors who expect to run their businesses in China. We take foreign investors and overseas companies as our main service objects and present strong multi-language communication ability. Our English-speaking consultants can help you solve any problems that you may have. We can also translate your financial report into English or even provide assistance in communication with your overseas headquarter.
4. Does the company have a stable physical office address?
The working environment is a strong proof of the company’s business reputation, staff ability, and financial condition. You can learn about the place where your financial records are kept to get an overview of the firm’s creditability and reliability.
Why Hongda: We have established physical offices in various cities across the Chinese mainland, Hong Kong, the UK, and Vietnam. Understanding that choosing a partner with reputation and reliability would be an effective method to reduce risk, you are welcome to have an on-site visit to one of our offices to enhance your confidence about Hongda. Our financial managers can discuss the company financial report with you face-to-face and provide suggestions on the company's operations and tax planning.
5. Whether the company provides integrated service contents?
Service contents may vary in different bookkeeping agencies. Some companies only provide fundamental financial recording and tax declaration, while others will also provide additional services by their experienced accountants or CPAs.
Why Hongda: Daily bookkeeping and accounting are only a small part of Hongda’s services. With Hongda, you can enjoy comprehensive financial management services, including bookkeeping, tax declaration, and tax filing, as well as financial consultation, financial analysis, and tax planning services.
6. Does the cfirm charge reasonable fees?
Although it's not wise to evaluate reasonableness by price solely, the cost is still an important factor that you must consider when choosing the right partner.
Why Hongda: We will not suggest “one-size-fits-all” service to our clients at their different stages of development. We start everything by understanding your unique requirements and the actual conditions of your company. we will propose a tailored business solution just for you with reasonable prices to fit you at the current phase. And it is always more cost-effective to partner with Hongda than hiring your own accountants in-house.
Hongda's Comprehensive Bookkeeping Service Package
1. Bookkeeping
- Accounting documents preparation, accounting books, registration and accounting statements compilation
- Subsidiary ledger of fixed assets
- Subsidiary ledger and general ledger of inventories’ quantity and amount
- Written feedback and communication of monthly abnormal items
- Bank deposits balance, legality and compliance of original documents, rationality of financial data
- Issue Fapiao
- Design and draft staff's salary form
2. Tax Declaration Service
- Declare VAT and individual income taxes
- Pre-declare corporate income tax and final settlement of annual income tax
3. Tax Filing
- File Accounting books and tax declaration documents: Bookkeeper prints and file types of documents monthly and prints accounting books yearly
4. Tax Risk Management
- Profit, goods turnover tax, and income tax management
- Seasonal Balance Sheet and data analysis, adjustments and suggestions
- Providing assistance when communicating with the local tax office relating to company's accounts
- Providing tax advisor service and taxation self-checking advice
- Make updates to company’s registered information (Does not include shareholder changes)
- Arrange payment to local supplier and office expense, etc
- Handle bank reconciliation
- Handle the salary payment to local employee
- Handle foreign currency operation in the bank
- Assist with payment to overseas headquarters
