Russell Bedford Hua-Ander - Statutory Audit

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Statutory Audit

The Chinese laws require that all foreign investment companies and local limited liability companies to be audited annually by CPAs. The main purpose of the statutory audit, with the exception of meeting needs of investors, is to facilitate the annual examination with various governmental departments. The filing deadlines set by the departments vary from April 30 to June 30. Normally April 30 is regarded as the deadline for the statutory audit, which means that all statutory audits have to be performed during the four months from January to April.

When performing an audit, the CPA shall observe the Chinese Independent Auditing Standards (CIAS) promulgated by the Chinese Institute of Certified Public Accountants (CICPA). The objective of statutory audit is for the CPAs to express an opinion whether the financial statements present fairly, in all material respects, the company’s financial position as at year end, the results of its operations and its cash flows for the year, in accordance with the requirements of both the Accounting Standards for Business Enterprises and the Accounting Regulations for Business Enterprises.

Russell Bedford Hua-Ander provides statutory audit service to foreign investment enterprises (FIEs, including joint ventures and WOFEs) and local limited liability companies all over China. In particular, we are experienced in auditing foreign investment companies and many of us have over ten years' experience serving FIEs. Our statutory audit service is featured with the following points:

While targeting to meet the requirements of the government, we regard it a priority to meet the investors' needs of understanding the company's true financial situation, operational results, and cash flows
We see the audit as a good opportunity of assisting the company in management improvements. Issuing a management letter is one of our communication vehicles with the management when we identify material weaknesses in internal controls and other financial and tax issues
To facilitate foreign investors' reading of the audit report, we provide English version of the report if required

In addition to Chinese statutory audits, as a PCAOB registered firm, Russell Bedford Hua-Ander is also able to perform US public company audits in compliance with the PCAOB Audit Standards and SEC regulations. Our capability to perform audits of Chinese subsidiaries or entities of main operations in China of US public companies provides these companies with a best cost-effective option.