Accounting Reform During The Economic Transition Period: An Analytical Study To The Experiment Of China

Since 1978 China started to reform its socio-economic system. The main objective of the China's economic reform program is to apply what is called socialist market economic system instead of the central planned economic system. The complex interaction relationship between the economic systems and accounting systems created a vital prerequisit to adopt another program to reform the accounting practices and regulations to become relevant to the new economic system. This was the main motive to prosecuting this study reviewed the process of accounting reform in China during the economic transition period.This study includes six chapters as follows:In the first Chapter the researcher will give an introduction to the subject, the questions and the objectives of the study which mainly concerns:To discuss the effects of the current economic reform program on the accounting practices and regulations.To discuss the role of accounting in the implementation of the economic reform program.To analyze and evaluate the process of accounting reform in China during the economic transition period.To evaluate and analyze the process of adapting the accounting disclosure in China to the new economic environment.In the second chapter the researcher reviews the process of economic reform in China during the period from 1978 till now as an important step before the attempt to review and evaluate the process of accounting reform in China. The discussion in this chapter appears that:As a result of adapting the economic reform program, markets and trading mechanisms were developed to play central role in the economy. The role of the central government has been moving to establish an appropriate framework for the market in terms of legal systems and economic regulations.Since China embarked on its economic reform program its economy has been growing at an unprecedented rate.China still considered within the transition economic framework and the process of economic reform still in progress.In Chapter three the researcher discusses the effects of the economic reform on accounting and the role of accounting during the economic transtion period. The discussion suggests that:Accounting Reform During the Economic Transition Period: An Analytical Study to the Experiment of China.The current process of the economic reform has a significant influnce on the objectives of the financial reports, the accounting practices and the framework of accounting regulations.On the other hand accounting information has a significant role during the transitional period. The researcher discussed two main areas where accounting can plays a vital role during the economic transition period: (1) the role of accounting in the process of the privatization program (2) the role of accounting to realize the effectiveness of the market.The fourth chapter addresses the process of accounting reform in China during the economic transition period. During the period of central planned economy the key role of accounting was to facilitate the preparation of the national economic plan and the monitoring of its execution. Therefore, the Fund management accounting system was adopted throughout the country. Since 1978, there are a condensed efforts to reform the accounting practices in China to be suitable for the new economic system and in line with the international accounting practices. The issue of the accounting law in 1985(and its revision in 1999), reforming the uniform accounting systems and regulations in 1992 onwards, the issuance of the accounting standards since 1992 onwards, and the accounting regulations for foreign investment and share enterprises in 1992 along with their amendments and attachments are the most significant changes. These changes have reformed China's accounting practices to be closer with the international accounting standards and conventions.The researcher concludes that although China made a great progress to reform its accounting practices and regulations, still considered within the transition framewo...