How long should you keep accounting records?

July 13, 2021by Stephanie Liu0

According to the Accounting Records Management Method, the accounting files in China refer to various forms of accounting information, such as text and charts with preservation value, which are received or formed in the process of accounting and could record and reflect the economic business matters.

The electronic accounting files, which formed, transmitted and stored through electronic devices such as computers, also included in this definition.

  •  Accounting vouchers
    Including original vouchers and accounting vouchers.
  •  Accounting books
    Including general ledger, subsidiary ledger, journal, fixed assets card and other auxiliary books.
  •  Financial accounting reports
    Including monthly, quarterly, semi-annual and annual financial accounting reports.
  • Other accounting materials
    Including bank reconciliation statements, bank statements, tax returns, accounting file handover list, accounting file storage list, accounting file destruction list, accounting file appraisal opinion and other accounting materials with preservation value.

How long you need to keep your accounting records?

In order to facilitate the unified management of archives and to combine the actual utility demand (e.g., as evidence in civil cases) of accounting files, the minimum period for the storage of accounting files in China was adjusted from 3, 5, 10, 15 and 25 years to 10 and 30 years in 2016. The storage period of accounting archives stipulated shall be the minimum storage period.

What provisions China made for accounting electronic files?

The Management Measures has made corresponding provisions on the scope, storage, transfer and destruction of the electronic accounting files.

  • Storage format requirement
    If meet certain conditions, electronic accounting materials generated internally and received externally by companies and organizations can be archived electronically only.
  • Transformation requirement
    The electronic accounting files and their metadata shall be trans over together when the electronic accounting files are handed over, the format of the documents shall conform to the relevant provisions of China’s national archives management;Electronic accounting files in special formats shall be handed over together with their reading platforms.
  •  Destruction requirement
    The destruction of electronic accounting files shall be supervised jointly by the archives management institution of the corporation, the accounting management institution and the information system management institution.

Under what conditions can electronic accounting data be kept in electronic form only?

  • Data source
    Electronic accounting data sources should be authentic and valid and are formed and transmitted by electronic equipment such as computers.
  • Accounting system
    The accounting system used can accurately, completely and effectively receive and read electronic accounting data, can output accounting documents, accounting books, financial accounting statements and other accounting data by the national standard archiving format, and has set up the necessary review and signing procedures such as handling, examination and approval.
  • Electronic records management system
    The electronic records management system used can effectively receive, manage and use the electronic accounting records, meet the long-term storage requirements of electronic records, and establish the retrieval relationship between the electronic accounting records and other related paper accounting records.
  • Measurements
    Effective measurements should be set to prevent tampering of electronic accounting files.
  • Electronic accounting file backup system
    The electronic accounting file backup system should be effectively prevent the impact of natural disasters, accidents and man-made destruction.
  • Electronic accounting materials
    The electronic accounting materials formed do not belong to the accounting files with permanent preservation value or other valuable preservation value
  • Electronic signature
    The electronic signature by the Electronic Signature Law of the People’s Republic of China shall be attached to the electronic accounting materials.

Which accounting files can be carried out of the country?

The accounting files of all institutions within the territory of China shall not be taken out of the country. The accounting archives of enterprises established abroad by institutions stationed abroad and domestic institutions shall be managed in accordance with relevant Chinese state regulations.

Stephanie Liu

Stephanie Liu is the Managing Partner, Azure Group China, based in Shanghai. Stephanie has more than 15 years of professional working experiences. She has supported numerous multinational clients to set up businesses in China & Australia. Stephanie also sits on the board of AustCham Shanghai.

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