Background

The Ministry of Finance of China is responsible for administering the national accounting work; overseeing and regulating accounting practice; developing and implementing nationally unified accounting system; supervising and providing guidance on the certified public accountants and accounting firms; guiding and overseeing social auditing.

Accounting Standards

According to the Accounting Law of the People's Republic of China, all Chinese enterprises shall adopt the Chinese Accounting Standards for Business Enterprises and other nationally unified accounting system formulated and issued by the Ministry of Finance for accounting purposes. The Chinese Accounting Standards for Business Enterprises have substantially converged with IFRS Accounting Standards. As of now, China has issued 1 Basic Standard, 42 Specific Standards, and 18 Interpretations of Accounting Standards for Business Enterprises.

Sustainability Disclosure Standards

The unified national sustainability disclosure standards of China follow a convergence approach with ISSB standards, and are formulated jointly by the Ministry of Finance together with relevant ministries of the State Council. The unified national sustainability disclosure standards system consists of Basic Standard, Specific Standards, and Application Guidance. As of now, the Ministry of Finance of China and other ministries jointly issued the Sustainability Disclosure Standards for Business Enterprises: Basic Standard (Trial) along with its Application Guidance, as well as the Sustainability Disclosure Standards for Business Enterprises No.1 — Climate (Trial) (Exposure Draft).