====== Introduction ======

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The Chinese accounting framework is commonly referred to as:

  * the Chinese Accounting Standards (CAS) or
  * the Chinese Generally Accepted Accounting Principles (Chinese GAAP).

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====== The Fixed Assets Valuation Method ======

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===== Differences =====

**IFRS**: allows the use of both the historical cost method and the possibility of re-evaluating the asset(s).

**Chinese GAAP**: Companies can only use the historical cost method to valuate fixed and intangible assets.

===== Effects =====
Since the historical cost method does not allow for the re-evaluation of assets, which means there is the possibility for impairment losses of certain long-term assets, such as property, plant and equipment, intangible assets, investments (other than financial 
assets) and investment property.

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====== Fiscal Year ======

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===== Differences =====

**IFRS**: The company’s fiscal year can start at any point throughout the year provided that it encompasses a period of 12 consecutive months.

**Chinese GAAP**: must start from January 1st and no exceptions are provided.

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====== Classification of Expenses ======

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===== Differences =====

**IFRS**:  Expenses are classified by nature.

**Chinese GAAP**: Expenses are classified according to function.

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