Cherish Integrity of Accounting Profession: Chinese Premier

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Last updated at: (Beijing Time) Thursday, November 21, 2002

Cherish Integrity of Accounting Profession: Chinese Premier

The Chinese government has attached great importance to the development of the accounting profession, and has made unremitting efforts in the building of the accounting system, the making of auditing rules and the training of professionals in this area, said Chinese Premier Zhu Rongji Tuesday in Hong Kong.

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Zhu Addresses 16th World Congress of Accountants

Premier Zhu Rongji said Tuesday that the Chinese Government attaches great importance to the development of the accounting profession, and have made unremitting efforts to build the nation's accounting system, create auditing rules and train professionals in the field.

Zhu, speaking at the opening ceremony of the four-day 16th World Congress of Accountants, said the accounting profession is playing an increasing role in production management, business operations, investment risks and development strategies.

In the modern market economy, operational standards and professional ethics in accounting are extremely important, Zhu said.

He stressed that honesty and trustworthiness are not only the cornerstone of the market economy, but also the lifeblood of the firms and individuals in the profession.

"The accounting fraud incidents reported in some countries in recent years have thrown the accounting business into a credibility crisis,'' Zhu said, noting that the profession must take on the challenge by strengthening itself through increased independence, credibility and public confidence.

The 16th World Congress of Accounts, the first such gathering held on Chinese territory, has attracted more than 5,000 delegates from more than 100 countries and regions.

China has also sent a 1,800-member delegation to the congress.

"China has paid particular attention to the cultivation of professional ethics among accountants and has stepped up supervision and management accordingly,'' said Zhu in his keynote speech.

He indicated that in modern China, both the rules and the techniques of accounting and auditing are converging towards the international mainstream.

The premier said he hopes students at the three national accounting schools in China follow his urging to never falsify accounts.

In recent years, Chinese accountants and auditors have been urged to keep good faith and integrity, abide by the code of professional ethics, adhere to accounting standards and to never falsify an account, Zhu said.

They should strictly observe the principles of independence, impartiality and fairness and never succumb to pressure or unwarranted demands, he added.

Zhu said the accounting industry in China still does not meet its objectives but added that the country is determined to reach it.

Over the past two decades, China has vigorously promoted reform and opening up to the outside world, resulting in a historic transformation in its economic and social landscape, he said.

To counter the negative impacts of the Asian financial crisis and a sluggish world economy, China has, in recent years, expanded demands at home, implemented a proactive fiscal policy and a prudent monetary policy and pressed ahead with economic restructuring.

"The just-concluded 16th National Congress of the Communist Party of China mapped out the strategy for the all-around development of China's reform, opening-up and modernization drive,'' Zhu said.

Also Tuesday, Minister of Finance Xiang Huaicheng told the congress that China's accounting reform has achieved remarkable headway and the accounting market is opening wider to the outside world.

According to Xiang, China has initiated accounting reforms and issued a chain of regulations since the early 1990s. These reforms included setting up a market-oriented accounting model, restoring the certified public accountants system, as well as enhancing vocational education in accounting.

China has also gradually opened its accounting market to foreign investors since the early 1980s.

Zhou Xiaochuan, chairman of China Securities Regulatory Commission, also said the sound development of the capital market relies on a robust and healthy accounting sector, which provides professional finance reports and counseling.

Zhou said only 71 out of the 4,300 accounting firms in China serve listed companies, which lags far behind market demands.

He called for further development of China's accounting sector and extensive co-operation with foreign counterparts.

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