On Reform Of University Accounting Recognition Basis In China

With the development of high education, as an information system of recognition, calculation and record that reports to related information users, university accounting is becoming more and more important. Changes in university accounting reflects the history of high education development.As an important part in accounting, recognition determines the key elements by which the economic activities are recorded. There are two types of accounting recognition basis: cash basis and accrual basis. Cash basis is used in university accounting with the guide of"Accounting Standards of Institutes".Cash basis can directly reflect the movement of capital, which meets the demand of university budget management and accounting. With the establishment of market economy system and reform of university administration, the university accounting environment has been greatly changed. Cash basis is greatly impacted and can no longer meet the requirement of university accounting under the new circumstances. On the contrary, accrual basis has more advantages than cash basis, completely reflecting university stock of resources and calculating the cost of university education. With these advantages recognized, reform of university accounting recognition basis is urgent.Chinese accounting reform should be carried out according to international practice. As reform of commercial accounting in China has achieved great success, budget accounting, one of the two main branches in Chinese accounting system, should be reformed correspondingly. Experiences can be gained from foreign non-profit organizations accounting, such as the practice of American university accounting, and from reform of accrual basis in foreign governmental accounting to reduce the cost of reform of Chinese university accounting recognition basis. In light of the political, economic, legal and cultural background in China, modified accrual basis may be more suitable than accrual basis for Chinese universities. The reform of accrual basis is an enormous project, which calls for the support and cooperation from system, technology and personnel. It also calls for reconstructing Chinese budget accounting system, setting new standards of non-profit organizations accounting, re-orientating university accounting, defining ideas about the reform of university accounting recognition basis, selecting the right methods of the reform and defining the focus of the reform. With the reform as a milestone, university accounting is coming to a new era.