Notice of the Ministry of Finance on Issues Concerning the Asset Notice of the Ministry of Finance on Issues Concerning the Asset Evaluation Accounting on the Appreciation and Depreciation of Assets Invested Overseas by Foreign-Invested Enterprises

财政部关于外商投资企业对外投资资产评估增减值财务处理问题的通知

Promulgating Institution: Ministry of Finance

Document Number: Cai Qi [2003] No. 181

Promulgating Date: 07/04/2003

Effective Date: 07/04/2003

颁布机关: 财政部

文   号: 财企[2003]181号

颁布时间: 07/04/2003

实施时间: 07/04/2003

To the finance departments (bureaus) of all provinces, autonomous regions, municipalities directly under the Central Government and cities specifically designated in the State plan:

In order to meet the requirements for entry into the World Trade Organization, facilitate the further development of foreign-invested enterprises ("FIEs") and safeguard the long-term interests of Chinese and foreign parties, we hereby notify you on the issues concerning the asset evaluation accounting on the appreciation and depreciation of the physical or intangible assets invested overseas by FIEs:

  各省、自治区、直辖市、计划单列市财政厅(局):

  为了适应加入世界贸易组织的要求,促进外商投资企业进一步发展,维护中外各方的长期利益,现就外商投资企业以实物或者无形资产对外投资评估增减值的财务处理问题通知如下:

1. Where the sum of the book value of any physical or intangible asset invested by an FIE and the relevant payable taxes and fees (hereinafter "initial investment cost") is greater than the share of the FIE's share of owner's equity in the investee, such difference shall be regarded as an equity investment difference and shall be amortized and recorded as an entry in the profit and loss account pursuant to the relevant provisions; where the initial investment cost is less than the FIE's share of owner's equity in the investee, such difference shall be regarded as a capital reserve.

The relevant provisions of the Notice on Printing and Distributing the "Supplementary Provisions on the Implementation of the New Enterprise Financial System by Foreign-Invested Enterprises" (Doc. No.: Cai Gong Zi [1993] No. 474) issued by the Ministry of Finance in 1993 shall no longer be in effect.

    一、外商投资企业以实物或者无形资产对外投资,投出资产的账面价值加上应支付的相关税费(即初始投资成本,下同)大于应享有被投资单位所有者权益份额的差额,作为股权投资差额处理,并按有关规定摊销计入损益;初始投资成本小于应享有被投资单位所有者权益份额的差额,作为资本公积处理。

  我部1993年下发的《关于印发〈外商投资企业执行新企业财务制度的补充规定〉的通知》〔(93)财工字第474号〕相关规定不再执行。

2. Where an FIE has already recorded the asset evaluation accounting on the appreciation and depreciation of physical or intangible assets invested overseas as an entry in the profit and loss account pursuant to the provisions of the Notice mentioned in the preceding paragraph, the FIE shall, in the event of profit distribution, take full account of the factor that there is no cash flow associated with the appreciation or depreciation of the invested assets. With respect to any value regarded by the FIE as profit in accordance with the provisions of the original financial system, the undistributed portion may be used to make up losses or converted as capital increase for years afterwards.

Ministry of Finance

July 4, 2003

    二、外商投资企业原按财政部(93)财工字第474号文件规定,以实物或者无形资产对外投资评估增减值已经计入损益的,因投出资产评估增减值不产生现金流量,企业在利润分配时应充分考虑这一因素。企业按照原有财务制度规定作为利润处理尚未分配的,可用于以后年度弥补亏损或者转增资本。

财政部

2003年7月4日