China Consolidation

The applicable accounting rules in China are guided by the Chinese Accounting Standards (CAS), also commonly known as the Chinese Generally Accepted Accounting Principles (or PRC GAAP).

The applicable accounting rules in China are guided by the Chinese Accounting Standards (CAS), also commonly known as the Chinese Generally Accepted Accounting Principles (or PRC GAAP). Although the Chinese Accounting Standards maintain a high level of integration with internationally accepted accounting standards, such as IFRS, foreign investors must understand a number of core differences that exist. For a comprehensive understanding of China consolidation practices, please refer to our full article for a comparison between PRC GAAP and IFRS.

Find out how we can help with all your consolidation needs by completing the form on the right-hand side of the page!

We offer our clients a variety of services to support them to understand the accounting and finances of their Chinese subsidiary, and we support as well with the conversion of the financial information of the Chinese subsidiary according to their group standards.

Ongoing Consolidation

With our team of qualified tax advisors and CPAs with vast exposure to internationally operating companies we are not only able to provide our clients with a full understanding of the finances of their Chinese subsidiary, but we also support to convert the Chinese financial statements according to their group reporting standards on a recurring basis. We offer our clients customized financial reporting packages which alleviate the need for the finance team abroad to translate the financial information of their Chinese subsidiary.

Conversion of Annual Audit to International Accounting Standards

Whereas we cooperate with our Chinese qualified CPA partners to provide bilingual audit reports, differences between the Chinese Accounting Standards and international accounting standards will continue to exist. Therefore, we rely on the expertise of our team of certified accountants to support with the conversion of the annual audit report into local accounting standards applied in the home country of our clients. As a partner who has helped foreign companies in China for more than a decade, we can rely on a network of trusted CPAs to support with the conversion of the Chinese audit report into local accounting standards of virtually all countries around the world.

Group Component Audit

In addition to our support with consolidation of accounting and conversion of the annual audit, we also support our clients with the completion of documents for the component audit of the company. Based on the requirements from the headquarter and the component auditor, we coordinate with our local CPA partners and ensure all relevant information for the component audit is provided according to international standards.

Country-by-country reporting

A Country-by-Country report, also known as a CbC report, needs to be prepared by the ultimate holding company of a multinational group with consolidated financial statements of the past year exceeding EUR 750 million (equivalent to RMB 5.5 billion, or HKD 6.8 billion).
Constituent entities in Mainland China and those in Hong Kong may be subject to notify the tax administration in their respective jurisdiction if a Country-by-Country Report filing obligation arises, therefore it is important for internationally active companies to identify whether they are subject to any Country-by-Country filing requirements in China or Hong Kong. We advise our clients on CbC reporting and notification requirements, including:

Country-by-Country Reporting requirements in China.
Country-by-Country Reporting requirements in Hong Kong.

Learn more about China consolidation

Get in touch with us today and learn more about how you can make your company’s accounting processes streamlined and simple.

Testimonials

MSA has been our trusted advisor throughout the entire lifecycle of our China journey, enabling us to dispatch employees (EOR) to China while having no legal entity and the incorporation and operationalization of our Chinese subsidiary. After this, MSA continues to prove its value as an advisor in supporting not only Chinese accounting, taxation, and compliance requirements but also by advising on specific licensing requirements within the horticulture industry in China, such as those for trading in pesticides and other chemicals. With a profound understanding of our headquarters’ interests and a thorough understanding of local business practices in China, MSA has enabled us to balance the often-conflicting requirements for control and compliance with our ambitious China growth strategy.

Royal Brinkman

Vincent Van Der Wilk
Area Manager Asia & Africa at Royal Brinkman

For our fast-growing business, we need a reliable partner to handle all our payroll-related matters, which we found in MSA. They helped us streamline our internal processes by implementing and improving compliance processes from a legal perspective and in terms of our corporate policies. We fully trust in the confidentiality of our employees’ data, as they ensure secure data storage from internationally recognized providers. Whether on ad-hoc requests or long-term oriented recurring matters, we always receive a fast and complete response to our questions that help us achieve our compliance goals and overcome the challenges in payroll, IIT, and social security in China.

Genuine German

Damian Maib
Founder

MSA was our first choice when we were looking for a China-based accounting firm with a fundamental understanding of our Belgian background and the ability to connect two diverging business cultures. As our company operates with the corporate ERP system Oracle, we are delighted that MSA works through proprietary access directly in our system, ensuring the availability of our company figures in the format we are accustomed to. During our company’s setup procedure, they managed to organize particular steps without the personal presence of the company representatives (e.g., opening a bank account) by identifying alternative verification procedures. We appreciate that MSA always listens to our queries. They are very well connected both within China and internationally. In addition to our questions about our China business, we are glad to receive advice on questions about other international topics from their connections within their global network.

Hybrid Software

Joachim Van Hemelen
Chief Financial Officer

MSA has been an exceptional business partner for our company, whom have a thorough understanding of our internal processes and our ERP system. As a result, and combined with their expertise in finance and taxation, they have been able to support Feinmetall by training our finance- and administrative staff to ensure quality standards and compliance throughout all areas. Because of their availability on short notice, we can rely on MSA’s support at a moment’s notice if required. We further rely on MSA to follow our monthly business on site in China in terms of accounting, taxation, and general compliance. Ensuring full compliance with local regulations and transparency for our management team in Germany is essential and MSA is our trusted partner helping us achieve this.

Feinmetall

Patrik Dinser
Commercial Director

From day one of our collaboration, I have found the team at MSA perfect for our needs. As a UK based business with notable activities in the Far East, we are looking for clear, constructive and accurate advice along with of course day to day financial/fiscal support. This is exactly what we get, and this provides enormous reassurance over the numbers and furthermore excellent support as we grow our business in the Far East. A true partner to our business in every sense of the word.

Badgequo Ltd.

Matt Goldstein
Finance Director

MSA has been our trusted service provider since the establishment of our operations in China. With a profound understanding of Chinese compliance requirements and the ability to translate these requirements in an international context, MSA has enabled us to achieve an exceptional level of transparency and an understanding of the Chinese financial and administrative regulations. After the expansion of our operations in China we continue to rely on the expertise of MSA in relation to taxation matters. MSA continues to reserve dedicated staff members, with a thorough understanding of our operations, whom are ready to support our local finance team in a heartbeat should the need arise.

Lotus Bakeries NV

LOTUS BAKERIES CHINA

MSA is our advisor of choice for complex tax and financial advisory with respect to our China operations. MSA’s team of experts has supported us with extensive advice on various topics such as international transactions, tax implications and business structure optimization. We trust on the company’s knowledge and experience to make well-informed decisions that are key to our company’s success in China. Most notably, MSA’s solid advice and practical support has enabled us to successfully optimize our internal business structure, which included among others comprehensive advice on the optimal business structure for CIBES’ operations in China and subsequent support from MSA with the implementation of the new structure (incl. establishment of 40 branches across Mainland China).

Cibes Lift Group AB

Manuel Neuhofer
Director of Finance and Administration for ASIA & MENA CIBES Lift Group

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