1. The new Company Law came into effect on June 65438+ 10/2006. After the new "Company Law" comes into effect, should the surplus reserve fund be accrued according to the provisions of the "Company Law" or continue to accrue three funds according to the provisions of the original laws and administrative regulations on foreign-invested enterprises? If you continue to withdraw from the three funds, how to determine the withdrawal ratio? What problems should be paid attention to when extracting employee incentive fund?
2. When should foreign-invested enterprises withdraw three funds?
3. How does the controlling shareholder of a foreign-invested enterprise list the employee incentive fund extracted from the foreign-invested subsidiary when preparing the consolidated statement?
4. If the certified public accountant finds that the three funds or surplus reserves of foreign-invested enterprises do not conform to the provisions of relevant laws and administrative regulations during the audit, can he make suggestions for audit adjustment?
Answer:
1. Whether foreign-invested enterprises need to withdraw three funds under the new company law is essentially a question of how to deal with the relationship between the new company law and the relevant laws and administrative regulations of the original foreign-invested enterprises. At present, the Company Law and relevant laws and administrative regulations on foreign-invested enterprises have the following provisions on surplus reserve or withdrawal of three funds in profit distribution:
(1) Article 167 of the Company Law stipulates: "When distributing the after-tax profits of the current year, the company shall withdraw 10% of the profits and include it in the company's statutory reserve fund. If the cumulative amount of the company's statutory provident fund is more than 50% of the company's registered capital, it may not be withdrawn. "
(2) Article 76 of the Regulations for the Implementation of the Law on Sino-foreign Joint Ventures stipulates: "The principles of profit distribution of a joint venture after paying income tax in accordance with the Income Tax Law of People's Republic of China (PRC) on Enterprises with Foreign Investment and Foreign Enterprises are as follows: (1) Withdrawing reserve funds, employee bonus and welfare funds and enterprise development funds, and the proportion of withdrawal shall be decided by the board of directors; ……"。
(3) Article 58 of the Detailed Rules for the Implementation of the Law on Foreign-funded Enterprises stipulates: "The profits of foreign-funded enterprises after paying income tax in accordance with the provisions of the China tax law shall be drawn from reserve funds and employee incentive and welfare funds. The withdrawal ratio of the reserve fund shall not be less than 10% of the after-tax profit. When the accumulated withdrawal amount reaches 50% of the registered capital, it shall not be withdrawn. The extraction ratio of employee reward and welfare funds shall be determined by foreign-funded enterprises themselves. "
Article 218 of the Company Law stipulates: "This Law is applicable to foreign-invested limited liability companies and joint stock limited companies; If there are other provisions in foreign investment laws, such provisions shall apply. " In order to further clarify the legal application of foreign-invested enterprises under the new Company Law, the State Administration for Industry and Commerce, the Ministry of Commerce, the General Administration of Customs and the State Administration of Foreign Exchange have successively issued the Notice on Printing and Distributing the Implementation Opinions on Several Issues Concerning the Administration of Approval and Registration of Foreign-invested Companies (No.812006) and the Notice on Implementing the Foreign-invested Company Law.
According to the provisions of these documents, after the new Company Law comes into effect, whether a foreign-invested enterprise withdraws its surplus reserves according to the provisions of the Company Law or three funds according to the relevant laws and regulations of the original foreign-invested enterprise mainly depends on how its articles of association stipulate the profit distribution. Because the articles of association of foreign-invested enterprises are also legally binding documents approved by the competent commercial authorities. The highest authority such as the board of directors of foreign-invested enterprises shall not violate the provisions of the company's articles of association when making profit distribution resolutions.
If a foreign-invested enterprise continues to withdraw three funds instead of surplus reserve, it means that in terms of profit distribution, the enterprise will implement the relevant laws and regulations of the original foreign-invested enterprise. At this time, we should ensure that we fully comply with the relevant laws and regulations of the original foreign-invested enterprises on the withdrawal of foreign capital. The proportion of the three funds shall be decided by the board of directors on the premise of complying with the relevant laws and regulations of the original foreign-invested enterprises. There is no minimum proportion limit for the withdrawal of reserve funds for Sino-foreign joint ventures (but it is generally understood that it cannot be zero).
Foreign-invested enterprises should pay attention to the following provisions in the Notice of the Ministry of Finance on the Financial Treatment of Enterprises after the Implementation of the Company Law (Caiqi [2006] No.67): "After the enterprise stops implementing the public welfare fund system, if the employee incentive and welfare fund of foreign-invested enterprises continues to be withdrawn after the decision of the board of directors, it should be clarified in terms of use, conditions, use procedures, etc. as debt management." This is because under the new accounting standards for enterprises, if there is no clear purpose and payment plan, there will be no "current liabilities" in accounting, which leads to the provision of employee incentive funds that do not meet the definition of liabilities. Certified public accountants shall draw the attention of the management of foreign-invested enterprises to these provisions, and at the same time when the board of directors makes a resolution to withdraw the employee incentive fund, the competent department within the enterprise shall determine its use plan, which shall be operable and specific enough.
2. According to the appendix "Accounting subjects and main accounting treatment" of the Accounting Standards for Business Enterprises-Application Guide, the reserve funds and enterprise development funds extracted by foreign-invested enterprises should be accounted for in the "surplus reserve" account; The employee incentive fund is accounted for in the subject of "employee compensation payable". The extraction of the three funds is accounted by the "profit distribution" account and listed as a profit distribution item in the statement of changes in shareholders' equity.
The accounting treatment time for accruing surplus reserves or three funds by foreign-invested enterprises shall be determined according to the following principles: (1) If the laws, regulations or articles of association directly stipulate a fixed withdrawal ratio or standard (so the withdrawal amount can be directly calculated after the net profit as the withdrawal base is determined, and the board of directors or similar authority has no discretion in this regard), the accounting treatment of withdrawal can be carried out in the year when the net profit as the withdrawal base is formed; (2) If the laws, regulations or articles of association directly stipulate a fixed withdrawal ratio or standard, and the withdrawal amount needs to be determined by the resolution of the board of directors or similar authority, the accounting treatment of withdrawal can only be carried out after the relevant resolution is made by the board of directors or similar authority.
Specifically:
(1) If a foreign-invested enterprise accrues the surplus reserve according to the Company Law, the statutory surplus reserve accrued according to the net profit 10% may be recorded in the current year based on the net profit; Any surplus reserve can only be accounted for after the board of directors or similar authority makes a resolution (so it is usually reflected in the statement of changes in shareholders' equity in the next year).
(2) If a foreign-invested enterprise withdraws three funds according to the original laws and administrative regulations on foreign-invested enterprises, it should usually be recorded after the board of directors or similar authority makes a resolution (so it is usually reflected in the statement of changes in shareholders' equity in the next year); However, if the company's articles of association directly stipulate a fixed withdrawal ratio, it can be accounted for in the year when the net profit as the withdrawal base is formed.
3. If a foreign-invested enterprise, as a subsidiary, withdraws the employee bonus fund from the after-tax profit, the consolidated net profit listed in the consolidated income statement compiled by its controlling shareholder in accordance with China Accounting Standards for Business Enterprises should still be equal to the sum of "net profit attributable to shareholders of the parent company" and "current profit and loss of minority shareholders", that is, the after-tax profit of the foreign-invested subsidiary before the employee bonus fund is withdrawn shall be attributed to shareholders of the parent company and minority shareholders in proportion to the shares. Then, the shareholders of the parent company and minority shareholders respectively extract a part from their respective profits as employee incentive funds, which are reflected in the statement of changes in shareholders' equity as profit distribution (listed in the line of "profit distribution-others"), and offset the undistributed profits and minority shareholders' equity respectively.
4. The extraction of three funds or surplus reserves of foreign-invested enterprises is not so much a matter of accounting treatment as a matter of law and finance. The accounting treatment of withdrawing three funds or surplus reserves must be based on the relevant resolutions adopted by the highest authority of the company. Therefore, if a certified public accountant finds in the audit that the resolution made by the highest authority of a foreign-invested enterprise on withdrawing three funds or surplus reserves does not conform to the provisions of relevant laws and administrative regulations, he can't put forward suggestions on account adjustment, but he can draw the attention of the relevant authority of the audited entity to the provisions of relevant laws and regulations as management suggestions, fully consider the possible impact of this issue, and ensure that the profit distribution matters conform to the provisions of relevant laws and regulations; At the same time, according to the Auditing Standards for Certified Public Accountants in ChinaNo. 1 142-Considerations of Laws and Regulations in Auditing Financial Statements, the impact of this matter on the entire audited financial statements and the audit opinions issued by certified public accountants are considered.