An analysis of financial reporting requirement and challenges of Belgian companies setteling in China.

Abstract

In an increasingly globalized world, international trades happen more often than usual. Therefore, IFRS becomes more important in each country, including China. With the standardized accounting standards, companies can greatly diminish the costs on transforming the financial statements between different countries. Even though IFRS has been applied in more than 120 countries in the world, China is not part of it. However, one of the existing standards in China: Accounting Standards for Enterprise (New Standards) highly converges with IFRS. This report discusses the main differences between IFRS, New Standards and Enterprise Accounting System (Old Standards). Another feature of this report is to discuss and understand the practical consolidation methods in Belgium and China, stock market regulation, and the challenges for Belgian companies settling in China. The research of challenges that European companies faced when settling in China and the financial report consolidation is conducted through a series of interviews with professionals in Europe, Taiwan, and China. The purposes of those interviews are to link the practical experiences with theoretical standards, and to understand the difficulties that Belgian investors faced due to the special regulation in China.