Study On The Accounting For BOT Project Of The Highway Operating Enterprises

The highway enterprises play an important role for the development of thehighway network by BOT （Build-Operate-Transfer） project. With the wideapplication of BOT, the Ministry of Finance issued the “NO.2Interpretation ofAccounting Standards for Business Enterprises”, used to specify the accounting ofBOT project. The interpretation didn’t show the detail of accounting confirmation,measure, presentation, disclosure, which result the non-uniform accounting anddifferent way of presentation in the highway enterprises. Those differences don’tbenefit the investors to make profitable decisions.This paper discussed the disputes of BOT project accounting and put forward theopinions and improving measures. Firstly, the author study the “InternationalFinancial Reporting Interpretations Committee12—Service ConcessionArrangements”,“NO.2Interpretation of Accounting Standards for BusinessEnterprises”, the foreign BOT projects, and the domestic researches of BOTaccounting. The main issued problems contain the period of pre-construction,construction, operation and assets transfer. During the period of pre-construction, thepaper discussed the problems of confirmation and measure of the land using rights.During the period of construction, the paper discussed the confirmation and measureof contract revenue and costs. During the period of operation, the paper discussed theimpairment, routine maintenance, repair and renovation of the BOT assets. During thetransfer, the paper discussed the range, performance and condition of BOT projectassets.Finally, based on the previous discussion, it investigated the presentation anddisclosure of financial report of the highway enterprise and listed the influence ofdifferent presentation between the highway enterprises, such as the items of intangibleassets, construction in progress and long-term prepaid expenses. It propose that thehighway enterprises should add the impact of prior period errors, the changes oftraffic flow and fee criterion, the toll road operation and the lists of transfer assets tothe financial report.