Study On The Establishment Of General Purpose Water Accounting System In China

Water is the source of life and the essential factor of production, also element of ecology. Water shortage is becoming global crisis owing to non-balanced distribution, worsening environment, imperfect management measures, climate and environment changes. It is becoming more and more urgent to upgrade water resources management and actively respond to water risks and uncertainties. Over time the limitations of the hard infrastructure approach have become increasingly clear. Emerging twenty-first century there has been a gradual shift towards policies based on institutional reform, incentives and behavioural change. Water accounting is becoming more and more important as a basic decision support tool. Recent decades have witnessed growing demands for greater transparency and more clearly defined lines of responsibility and accountability in the management of water resource, which lead to the development of general purpose water accounting(GPWA).GPWA focuses upon the information needs of external users of GPWA reports, and present the cause and effect of the change of water and water right. The government formulates and promulgates water accounting conceptual framework for the preparation and presentation of general purpose water accounting reports, water accounting standard and assurance standard to guide water report entity to quantify and report water owned or managed by them with accounting principle, analogous to financial accounting. GPWA report includes three water accounting statements:statement of water assets and water liabilities, statement of changes in water assets and liabilities and statement of water flows. GPWA commits to provide the consistent and comparative information on the allocation and use of water resources to users of that report. As the first time of applying financial accounting principle and institution to water accounting, the importance of GPWA has been generally accepted by scholars in water accounting theory. Currently, research in GPWA have become popular in various fields of water accounting. However, Most of them are mainly on three water accounting statements prepared by accrual basis. The characteristic of GPWA report is not very clear in the country and region where water accounting is not based on accrual. The exiting literatures are lack of study on water rights in the statements and how water rights system influences the content of GPWA statements. The thesis focusses on GPWA report based on the water right system and non-accrual basis. China is facing water rights system innovation and implement of the strict water resource management system. The thesis argues the special features of GPWA report in the case of single water right and non-accrual basis, which coincides with exiting water management institute in China and is benefit for the development of GPWA in transitional economies.The paper is written on the basis of the above practices and theories. Based on the study of Chinese water management system reform and fully absorbing exiting research achievements, this thesis is a in-depth study on the theory of GPWA and suggest that it is significant to establish the system of GPWA in China. Based on the study of the key factors of GPWA, we research the structure and content of GPWA report in cases of single water right and non-accrual basis. The thesis discloses the effective path of reforming rule and regulation of water resources management in China. To achieve the above research goals, this thesis adopts literature analysis, normative approach, field survey and case study to design and put forward a series of issues to explore. The conclusions of this paper mainly include:(1) GPWA report shows specifying the accuracy and quantification approach used for all the water assets and water liabilities and changes thereto, with the potential to highlight monitoring. (2) GPWA report provides information more useful to users of that report for making and evaluation decisions about the allocation of resources than ever. Furthermore, it is used to assess the progressive implementation of water management policies and strategies and contribute to improved planning and management. (3) Water assets and water liabilities are the key elements in GPWA. The advantage of GPWA is greatly restrained due to lack of water assets and water liabilities elements in case of single water right and non-accrual basis.(4) The statement of water assets and water liabilities and the statement of water flows can be prepared, and they are more accurate and more distinct than water statement in China, although the statement of changes in water assets and water liabilities can’t be prepared, where single water right system and non-accrual basis are carried out. (5) The system of GPWA should be established in China after water right system and water right trade should be well-stablished, and accrual basis should be implemented in water accounting.This thesis contributes in the following aspects:firstly, the paper dedicates in the key elements in GPWA, suggests that superiority of GPWA is weakened due to lack of key elements. It deepens the understanding of water accounting with accrual basis. Secondly, the thesis investigates the special feature of GPWA report in case of single water right and non-accrual basis combined with water resources management system and practice in China. The paper studies how water right system and water accounting practice influence the structure and content of GPWA report, and supplement the theoretical and practical study of GPWA. Thirdly, the thesis provides a suitable perspective on study and practice of GPWA for transitional economies. It suggests that the water resources management system reform should be carried out firmly across China. As a result, water right system and water right trade should be well-stablished, and accrual basis should be implemented in water accounting. After reforms as aforementioned is fullfilled, the System of General Purpose Water Accounting is fully set up.This paper is divided into seven parts. The arrangement is as follows:The first chapter introduces the real background and theory background, specifies this paper’s research questions and research significance, research contents and methods, technical route, and the innovation of this paper, and introduces the framework of this paper from an overall perspective. The second chapter is the theoretical basis and literature reviews, combines related researches about GPWA in the field of water accounting study and makes comments according to the literature reviews and points out the enlightenment to this study. The third chapter analyses the theory of GPWA systematically and the main content and the technology of GPWA. The fourth chapter diagnoses the situation of water accounting in China. It raises the significance of establishing GPWA and the framework of the system of GPWA in China. The fifth chapter discusses influence of accrual basis on the structure and content of GPWA report and analyses the system of water resources management at present in China. We raise the effective path to establish system of GPWA in China. The sixth Chapter is case studies. We choose two typical water management department, such as Miyun reservoir management department, Beijing Waterworks Group as research objects, focusing on the preparation of GPWA report, displaying the characteristic and outcome of GPWA report in case of single water right and non-accrual basis and verifying the theoretical derivation. The seventh Chapter is the conclusion and discussion. In this chapter, it puts forward research contributions and policy implication, and points out future research directions and research limitations.