LLP for small businesses

Friends,

Saw this signboard at a hawker stall.

It reflects the increasing sophistication of people operating even small businesses.

Are you familiar with this form business registration to take advantage of it? For those uninitiated, LLP is limited liability partnership.

Send me a pic of anything interesting relating to the topic of accounting.

Cheers…

P/S – Will try the food this weekend.

Companies in China have 2 sets of accounts?

P/S – Jalan Besar Stadium

Yes, it is official now.

What happened?
Mainland-listed companies will have to prepare two sets of annual reports for this year after new accounting standards come into effect on Jan 1.

Shanghai and Shenzhen-listed companies will have to publish their 2006 annual reports as before, using the current accounting standards, but will also have to publish an additional report where their results are calculated according to the new international standards.

What are the implications?
According to Haitong Securities analyst Zhang Qi – ‘Many companies used the old accounting system as a form of window dressing to make themselves look profitable when in fact they were not.’

Will this lead to a severe correction of Chinese stock markets if this has still not been factored into the pricing by now?

Initial public offerings (IPOs) or secondary offerings must also use the new accounting standards starting Jan 1, according to new regulations issued last week by the China Securities Regulatory Commission. Last three years’ profit is a prerequisite for listing in China.

Will this therefore reduce the queue for IPOs in China and thus reduce demand for listing in foreign bourses eg. Singapore?

For those who will not make the cut, will they go back door listing?

Local companies are exempted from the rule for now.

If the government want to see a change in this area, it should take the lead by asking all its state-owned enterprises to make that change asap.

Reference – Dec 5, 2006, “New accounting rules affect China firms’ profits”, BT/SCMP.

CCDG out. ASB in.

Minister of State for Finance, Mdm Lim Hwee Hua said that Accounting Standards Board (ASB) will replace the Council on Corporate Disclosure and Governance (CCDG).

Effective Sept 1, 2007.

It will comprise key regulators, senior accounting professionals, and leading users of financial information.

Why the change?
Except for expanded responsibilities of issuing standards to cover entities such as charities, societies and co-operatives, I wonder why the need to change the name when essentially almost everything else remains unchanged.

Probably the name change is just that ie. to signify the addition of responsibilities.

Good night…