The CPA Examination Reform, Bad or Good?
On August 26th, the CICPA soliciting opinions on the CPA examination reform. According to the survey, initiated by the China Accounting View and the China Accounting Daily, 40% people support or against the reform and 20% people were neutral.

Regular the Service and Charge of Association and Market Agency
The National Development and Reform Commission will regulate for kinds of problems in 3 steps  as follows: Firstly, units are forced to be member of industry associations, pay fees and supply service. Secondly, industry associations, by right of administrative power and monopoly status, set up items for charge. Thirdly, Attestation agency prepare reports illegally or fraudulent reports. Fourthly, Agency charge for certification, inspection, appraisal, holding qualification examinations illegally.

Interest Taxation Canceled
The State Council decided to cancel the bank saving interest taxation from October 9th.

Proofreader : Meyoung

Note:

“China Accounting News Weekly” is established on August 5, 2005. It selects important accounting news weekly to convenient the  people can acknowledge the developments quickly. From its launching, thousands of people read it every week.

In order to promote the development of China accounting industry to English readers, we make this English edition on March 23, 2007. If there are any problems, please contact with qiaobocao@snai.edu

New Business on Fund Valuation
On September 19th, the China Securities Regulatory Commission (CSRC) issued new rules on investment funds valuation, especially the valuation on investment without market price such as long time suspended stocks. Under some situations, accountants’ audit are prerequisite.

No.2 Explanation on the Enterprise Accounting Standards issued
The Explanation, issued by the Ministry of Finance, explained and regulated six problems in practical implementation and it’ll go into effect on August 7th 2008.

Regulation on CPA Honesty Oath issued
On August 16th, the CICPA required all registered CPA take part in oath at least once and regulated the oath in detail. It also definitude the procedure and new affidavit.

The Authorities will Choose Accounting Firms to Audit Central Companies
The State-owned Assets Supervision and Administration Commission of the State Council will audit the restaurants and hotels of some central companies in electrical and telecom industry. On September 17th, the Commission began to choose outstanding accounting firms for the auditing.

Proofreader : Meyoung

Note:

“China Accounting News Weekly” is established on August 5, 2005. It selects important accounting news weekly to convenient the  people can acknowledge the developments quickly. From its launching, thousands of people read it every week.

In order to promote the development of China accounting industry to English readers, we make this English edition on March 23, 2007. If there are any problems, please contact with qiaobocao@snai.edu

Notice of Ministry of Finance on the Relevant Issues Concerning Strengthening the Continuing Management on Appraisal Firms

Financial Assets Valuation
Research on Mortgage Value Type Based on Management in Commercial Bank
Mortgage as a main credit risk mitigation tool for commercial bank, its valuing is important to the bank’s risk control. While type of value is the basis of mortgage valuation, it draws a lot of concern on it. Nowadays, there are three different types of value used in mortgage valuation, i.e. market value, mortgage lending value and liquidation value. In this article, the author analyzed the three value types and suggested that it’s the market value that meets the commercial banks’ risk management requirement before and in the middle of the lending. Also, the author made some suggestions on commercial banks’ risk management.

Work Research
Economic Analysis of Valuation and the Emergence and Development of Valuation Profession
In this article, the author made an economic analysis on the valuation and the emergence and development of valuation profession based on Transaction Cost Theory, and pointed that the emergence of valuation is the necessary demand of the market. Also, this article analyzed under which conditions, valuation should be made by external valuers or by internal experts. At last, the author suggested that the profession should prove the transaction cost of value realization by valuation is lower than other systems’ arrangements to keep a continuous development of valuation profession.

Research on the Difference between the Exchange Price and Appraisal Value of Chinese Listed Companies

Some Thoughts on the Regularly Violating Activities in Appraisal Practice

Analysis of Marshall’s Thoughts of Income Approach to Valuing
Alfred Marshall, as a neo classic economist of UK, perfected the utility theory of value. He put forward the income value theory, which contributed to the foundation of the valuation theory. This article made a analysis to the income value theory and its economic basis and to some extent would help us to understand the modern valuation theories.

Interview with Vice President and Secretary-General of China Appraisal Society (CAS), Ms. LiuPing

China appraisal standard system was launched on 28^th November, 2007. At the same time, Ministry of Finance and CAS co-published fifteen appraisal standards including eight new standards. This set of appraisal standards covers all the appraisal practice process and the main areas of appraisal engagements. The publication of the set of standards indicated China has nearly set a full appraisal standard system and this would obviously play an important role in improving the appraisal profession’s influence and promoting the standardized development of appraisal profession and its high-quality service to market economy.

For more people to understand the set of standards as soon as possible and learn the background and process of standards setting, the innovation of the standards and some ideas of CAS and its requirements to appraisers during the implementation of the standards, the correspondents of the journal interviewed vice president and secretary-general of CAS, Ms. LiuPing

CAS and Beijing Appraisal Society co-held a Party to Celebrate the International Women’s Day

Sector Overview

Developing Appraisal Standards Training Fully, Ensuing Carrying out the Standards Effectively

Information about Appraisal Standards Studying & Local News

Sino-Australian Appraisal International Forum was Held in Beijing

Free Discussion

Two Important Principles in Appraisal Practice

Realizing and Preventing Appraisal Practice Risks

Case Analysis

Valuation for Financial Reporting
Effects Analysis of the Application of New Accounting Standards on Valuation
Valuation for Financial Reporting and the Stabilization of Securities Market
In this Article, after analyzing the securities market stabilization, the significance of fair value’s application and its influence on listed company’s profit, the author suggested that it should be the professional valuers to decide the fair value of sensitive assets and complex assets, and valuers should play their role in stabilizing securities market.

Business Valuation
Restudy of the Non-tradable Shares Valuation
In this article, the author conducted open data of 152 listed companies performing share reform by statistic software Excel 2000 and SPSS 12.0, and reached a conclusion that there is a distinguished correlation between share price and price/book value ratio. Then the author got the regression model for valuing non-tradable shares’ market price through price/book value ratio, and tested the rationality of the model.
Probability Analysis in Business Valuation
Development of Business Valuation in America
Discussion on Digital Television Internet Business Valuation
Discussion of the Methods Deciding Parameters in Business Valuation

Intangible Assets Valuation
Legal Factors Affecting the Value of Intellectual Property Rights

Informational Communication
Comparison and Analysis of Brand Rating and Brand Valuation Methods in Home and Abroad

Practice Topics
Review of Appraisal Profession Development History

Personal Property Valuation
Application of Income Approach in Fruit Tree Valuation

Special Report
Intellectual Property Strategy and Valuation Forum was Held in Beijing

Sector1: Enterprises’ Innovation and Valuation
Trend of Policy Promoting Enterprises’ Innovation
Speeding Independent Innovation, Strengthening the Protection of Intellectual Property and Enhancing the Enterprises’ Core Competences

Sector2: Intellectual Property Business and Valuation
Problems Related to Valuation in the Development of Service Trade
Legal Questions in Intellectual Property Business
The Research of Intangible Assets Valuation Based on Intellectual Property

Sector3: Financial Innovation of Intellectual Property and Valuation
Implementing Patent Mortgage Lending, Promoting Financial Innovation of Intellectual Property
Introduction of Intellectual Property Mortgage Lending of Small and Medium Enterprises
Financial Innovation of Intellectual Property and Risk Prevention
The Legal Risk and Its Prevention of Intellectual Property Mortgage Lending
Financial Innovation of Intellectual Property and Enterprises’ Independent Innovation

Sector4: Intellectual Property Rights Protection and Valuation
Intellectual Property Rights Infringement and Compensation for the Damages
Overseas Intellectual Property Rights Protection
Research for Valuation of the Damages Compensation for Intellectual Property Rights Infringement

Standardizing Valuation for Financial Reporting to Adapt to the Market Demands
Learning and Implementing the Guidance Notes for Valuation for Financial Reporting (Pilot) Better to Face the New Chance and Challenges
The Development of Valuation for Financial Reporting in US, UK and Canada——Speeches by Foreign Experts of PWC
Review of the Setting Process of Guidance Notes for Valuation for Financial Reporting（Pilot）

Sector Overview
Summit Seminar of the First China Jewelry Business Capital Operating was Held in Beijing
Price Inquiry System for Machine & Equipment Started to Work

Free Discussion
The Responsibilities of China Appraisal Society(CAS) Senior Members in Appraisal Profession Development

Real Estate Valuation
The Problems and Suggestions on Mining Property Rights’ Transferring Valuation
The Characteristic of House Dismantling and Moving and the Selection of the Valuation Method
Questions should be noticed in Mortgage Lending
Valuation of Lending with the Real Property as the Mortgage
Some Thinking about the Type of Value of Mortgage Lending
Which Type of Value Should be adopted in Mortgage Lending

Valuation in Airplane Lending

Regulations & Laws
The International Comparison of the Juristic Factors on Patent Valuation

Profession Building-up
Analysis of the Talent Loss of Small and Medium Appraisal Firms

Intangible Assets Valuation
The Specially of Intellectual Property of National Defense
Some Thinking on Valuing Non-patent Technique of Hospital

Business Valuation
Discussion on the Equity Valuation of Road Business of Sino-Foreign Cooperative Joint Ventures

The Proposed CPA Examination Reform
On August 26th, the CICPA solicited opinions on the Reform Plan of CPA Examination. The present examine system will be terminated in 2010. According to the draft proposal, the first step will be the professional level, which including 6 subjects as: Accounting, Auditing, Financial and Cost Management, Economic Laws, Taxation Laws and the new added one, Corporation Strategy and Risk Management.  The Second step will be the senior level.  The two level examinations will be held one time once a year.

Land Reserve Capital should be Accounted independently
On August 28th, the Ministry of Finance issued “the Accounting Method of Land Reserve Capital (for Trial Implementation)”.  It’ll go into effect on January 1st, 2009.

Strengthen the Management on Accounting Institutes
On September 4th, the CICPA solicited opinions on the regulations concerning improve and strengthen management and service of institutes. Accounting institutes are required to improve the working method and the management, strengthen the service on members and create new working field, strict the management and enhance the operation ability.

Regulate and Develop the Middle and Small Size Accounting Firms
The CICPA is soliciting opinions on this topic. It has proposed the target of regulation and development of middle and small size accounting firms and the related measurements in detail.

Proofreader : Meyoung

Note:

“China Accounting News Weekly” is established on August 5, 2005. It selects important accounting news weekly to convenient the  people can acknowledge the developments quickly. From its launching, thousands of people read it every week.

In order to promote the development of China accounting industry to English readers, we make this English edition on March 23, 2007. If there are any problems, please contact with qiaobocao@snai.edu

XIE Zhi-hua

(Beijing University of Industry and Commerce, Beijing 100037, China)

Abstract: This paper points out that measures for balance should be taken to prevent the fake behavior of audit organizations, that is, to substitute the original re-supervision over the audit organizations for balance, private audit for market balance, government audit for administrative balance, internal audit for self-balance.

Key Words: internal control; elements of internal audit; environment of internal audit; activity of internal audit

Development Trend of State Auditing

ZHU Yao-ping

(Audit Office of Jiangsu Province, Nanjing 210009, China)

Abstract: The development of state auditing includes six trends： the gradual advancement of the level of audit supervision, expansion of the performance audit, reform of audit management approach, progress of overall audit technology, perfection of audit supervision system and more attention to audit cultural construction.

Key Words: state audit; development; six trends

Computer Audit Mode under the Information Environment

LIU Ru-zhuo

(Tianjin Branch of the National Audit Office, Tianjin 300010, China)

Abstract: With the development of computer audit, we are facing many new issues in the field of computer audit. This paper first deals with the basic work of computer audit on the basis of its characteristics and concepts, and then explores its application with some cases in point and finally points out the trend of its popularization and development in the field.

Key Words: computer audit; system theory; data audit; audit mode

Occurrence of Government Audit Risks and its Regulation

Subject Panel

（Audit Bureau of Nanjing Municipality, Nanjing 21008, China）

Abstract: Government Audit System with high-specialty and high-risk is one of the tools to government supervision. The audit risks accompany with the whole process of government auditing. The audit risks come from the inherent reasons, the subjective reasons restricted by the current audit environment and the objective reasons of auditors. The government audit organs should find the fight remedy and improve the audit environment, enhance the auditors＇ level, strengthen the risk management and accept the external supervision to dilute the audit risks from the legal system. In this way we can avoid the audit risks.

Key Words: government audit; audit risks ; working regulations

Deficiency and Path Establishment of Performance Management in China＇s Audit Institutions

ZHANG Wen-jing

(School of International Audit, Nanjing Audit University, Nanjing 210029, China)

Abstract: Nowadays performance management deficiency in China＇s audit institutions is worth serious attention. Many audit institutions are not aware of the performance management, let alone of performance management practices. By learning from the advanced foreign experience and integrating with China＇s actual situation, this paper urges the department concerned to establish performance management in audit institutions, at the same time, we should expand the audit , strengthen the audit operational management, and build up the performance-based human resources management mechanism.

Key Words: audit institutions ; performance ; performance management ; path establishment

The Expansion of Finance Audit： To Strengthen Social Supervision and Control Finance Risk

PAN Zheng-yan

(Academy of Shanghai Social Sciences, Shanghai 200020, China)

Abstract: This paper focus on the special of finance audit in the financial supervision system. The first part analyses special features of the finance corporation and the importance of the social supervision. The second part deals with the risks of the local government that excessively raises loans in the current public financial system and special banking system. Finally, the author maintains that finance audit should and could play a positive role in the financial management and the control of financial risks.

Key Words: financial audit; expansion; social supervision; financial risks control

Efficiency of Auditing Committee： Literature Review

WEI Wen-jun, XIA Wen-xian

(1. School of Management, Yangtze University, Jingzhou 434023, China; 2. School of Management, Xiamen University, Xiamen 361005, China)

Abstract: This paper systematically reviews domestic and overseas literature on efficiency of auditing committee with respects to member structure, authority, resources and hard-working of auditing committee, and finally makes a general summary of related domestic literature.

Key Words: auditing committee; efficiency study; literature review

Factors and Paths Influencing Government Audit Quality——Perspective Based on China＇s Financial Audit

DONG Yan-an

(School of Accounting, Guizhou College of Finance and Economics, Guizhou 550004, China)

Abstract: This paper explores the main factors and paths influencing government audit quality with the weighing indexes as the analytical basis. The author maintains the main factors influencing auditing quality should include audit independence, audit power, auditor and economic development level.

Key Words: government audit quality; factors; path

Liability of Audit in Audit Reporting：Evolution and Introspection

YANG Shu-huai

(Department of Accounting, Tong ling College, Tongling 244000, China)

Abstract: Liability of audit in audit reporting has developed from scratch and from concrete to normative, then from normative to intensification. Appropriate definitions of liability of audit in audit reporting is result of hard choice of CPA between exploit audit certification s sufficiently and elude liability of audit and risk of audit reasonably. A definition of liability of audit in modem audit reporting is a direct communication way between CPA and audit reporting user. It is one of the most effective communication ways, but not the only one.

Key Words: audit reporting; audit liability; evolution; improvement

Construction and Definition of Customer Equity Based on the Accounting Equation

XU Huan-zhang, TAN Wen-wei

(School of Management, Xi＇an Polytechnic University, Xi＇an 710048, China)

Abstract: Based on the accounting equation （asset = liability ＋ the proprietor＇s rights and interests）, the paper explores the accounting construction of customer equity, then gives the accounting definition of the customer equity by analyzing its form, essence, trait, accounting objects and accounting attributes.

Key Words: customer equity; customer relationship; contract-trading relationship

Consideration and Countermeasures for Fulfilling Property Right of the Legal Person of Non-governmental Colleges in Jiangsu Province

QIAO Chun-hua

(Nanjing Audit University, Nanjing 210029, China)

Abstract: An unclear property right of non-governmental college is a common issue in educational economic circle. It greatly affects the development of non-governmental colleges. There are thorny issues when non-governmental colleges are required to fulfill property right of the legal person by government in 2007. Based on the analysis on the problems existing in property right of non-governmental colleges in Jiangsu province, theoretical thinking and policy recommendations have been proposed.

Key Words: non-governmental colleges in Jiangsu province; implementation of property right of the legal person; theoretical thinking; policy recommendations

The Importance of Internal Control and Its Evolution——Based on a questionnaire

ZHENG Shi-qiao , WANG Jian-jun, ZHAO Ling

(1. School of Accounting, Xinjiang University of Finance and Economics, Urumqi 830012, China; 2. School of Statistics and Information, Xinjiang University of Finance and Economics, Urumqi 830012, China)

Abstract: This paper first makes a survey into the internal control of enterprises on the basis of Norms of Enterprise Internal Control—— Basic Norms, and then makes a statistical analysis on the valid questionnaire papers from 115 enterprises. Form the above survey, the conclusion is of great significance to the optimization of enterprise internal control and the making of internal control norms.

Key Words: internal control; elements of internal control; environment of internal control ; activity of internal control

The Financial Manifestation and Countermeasures of Renminbi Appreciation on Business

CHANG Hua-bing

(School of Accounting, Nanjing University of Finance and Economies, Nanjing 210003, China)

Abstract: The renminbi appreciation is the steady anticipation at home and abroad presently. This paper analyses firstly the financial manifestation of renminbi appreciation on business from assets and debts work, cash flows, cost and profits, capital items and financing channels. Then some countermeasures that will solve the influences of the renminbi appreciation on business from business operations, financial management, accounting activities, financial instruments and giving the rein to trade superiority.

Key words: renminbi appreciation; financial manifestation; influence; countermeasures

Factors Analysis of P/E Ratio

SU Li

(School of International Business Management, Guangdong University of Foreign Languages and Trade, Guangzhou 510006, China)

Abstract: P/E ratio （price-to-earnings ratio） of a stock is a measure of the price paid for a share relative to the income or profit earned by the firm per share. Theoretically, a stock＇s P/E tells us how much investors are willing to pay per dollar of earnings. It is a tool widely used to evaluate the share＇s value and risks. This paper deduces intrinsic P/E ratio models from the discounted dividends model and decomposes the basic three factors into concrete ten factors which influence P/E value in different directions.

Key Words: P/E ratio; share value; factor analysis

Empirical Analysis of Earnings Management of Listed Companies Issuing Share Rights

DAI Jie-min , KONG Yu-sheng

(1. School of International Audit, Nanjing Audit University, Nanjing 210029, China; 2. School of Finance and Economics, Jiangsu University, Zhenjiang 212013, China)

Abstract: It is well known that the new policy of the share rights issued by CSRC since 2001 has triggered the earnings management of Chinese listed companies. This paper investigates nearly 1000 companies issuing share rights during 2001 to 2005 to find some conclusions.

Key Words: stock rights ; earnings management; liquidity ; operating profit

Financial Risks Analysis of the Changjiang Delta

SUN Qing, CAI Ze-xiang

(1. Nanjing University of Aeronautics and Astronautics, Nanjing 210016, China; 2. Nanjing Audit University, Nanjing 210029, China)

Abstract: In this paper, the index system was reduced based on the rough set and the fuzzy number was selected to construct the complementary judgment matrix. On the basis of the relative data and prudent analysis, we find out the different kinds of financial risk in Jiangsu, Zhejiang Province and Shanghai Municipality and finally make a comparative analysis of such risks.

Key Words: regional financial; financial risks; index system

A Strategic Study on the Promotion of County District Finance and Economic Development of Jiangsu Province

LIU Zhi-you

(Nanjing Audit University, Nanjing 210029, China)

Abstract: With the case of Jiangsu Province as its background, this paper first makes a survey of the elaborate statement on economic finance and the harmonious development from experts at home and abroad, and then analyses the realistic features of district economy and finance development in the case of Jiangsu Province, and finally puts forward some proposals on the policy in the district finance construction and promotion of district economic development.

Key Words: county district finance; county economic development; harmonious development

An Empirical Study on Effectiveness of Risks Regulatory System for Securities Firms

ZHANG Yi

(School of Business, Renmin University of China, Beijing 100872, China)

Abstract: This study is based on the 1996 BIS capital adequacy guidelines to employ the VaR based internal model method to calculate the VaR and the capital requirement using data on the actual fixed income security and equity security holdings of 85 security firms in China. We examine how these models fit security firms by comparing the new regulatory rules implemented by the China Securities Regulatory Commission（CSRC） in 2006 with the old ones in 2000. The empirical results show that the 2006 regulatory rules perform better than the old ones, but reflect the risk less accurately than the internal model. CSRC tends to adopt the internal model to calculate the capital requirements of security firms in the future. The risks discount ratio of main assets in the new regulatory system has been set lower, so the 85 securities firms’ trading book risk has been underestimated by 29 per cent on average. The study suggests that China’s securities regulatory authority should make some adjustment on the risks discount ratio of Shanghai 180 index stock, fund, firm bond and transferable bond.

Key Words: securities finns; capital requirements; market risks; standardized approach; internal models approach; VaR

Origins of Antidumping Protectionist of Developed Countries——From Perspective of Economic Rational

YANG Shao-yan, HUANG Jian-kang

(1.College of Economics and Management, Ningxia University, Yinchuan 750002, China; 2. Faculty of Economics, Nanjing Audit University, Nanjing210029, China)

Abstract: Antidumping in the developed countries is a kind of protectionist behavior in nature. From perspective of economics, only antidumping with the purpose for predatory dumping is rational and efficient. After analyzing the history of evolution of antidumping goals of developed countries, the paper concludes that under the title of fair competition, antidumping of developed countries departs from economic efficiency standards, meanwhile, directly antidumping with the result of limited imports shows their more attention on industries protection rather than economic efficiency.

Key Words: antidumping; trade protectionist; economic rational

Information Disclosure Strategic Management Based on Core Competitiveness

WANG Xiong-yuan, LIU Yan, GAO Yi

(School of Accounting, Zhongnan University of Economies and Law, Wuhan 430073, China)

Abstract: We consider listed company information disclosure a kind of strategic management. Information disclosure strategic management can make disclosure more understandable on one hand, and promote the company to set up a good image and ultimately be beneficial to the realization of its strategic objectives on the other hand. It requires the company to coordinate its disclosure strategy according to the change of competitors upper and lower reaches companies, and the competitive environment to carry out the information disclosure strategic management. In addition, the listed company can make its information disclosure strategic management span the company border, and extend to the competitors and upper and lower reaches companies.

Key Words: competitiveness; information disclosure; competitive advantages; strategic management

Target Management Mode to Create the Shareholder Value

LI Xiao-ruing

(School of Economic Management, Foshan Institute of Science and Technology, Foshan 528000, China)

Abstract: Target management for the shareholder value is to analyze the control over the driving factors of shareholder value and businesses value and related index signs, to manage the process of shareholders＇ creating value in combination with the business enterprise strategy, the finance management and the performance salary management

Key Words: the shareholder value maximization; decomposition of driving factors of value; target management

Specificity of Manpower Capital and Financing of Innovative Enterprises

CHEN Qing-hua, LI Xiang-ruing

(Nanjing University of Aeronautics and Astronautics, Nanjing 210016, China)

Abstract: With the booming of manpower capital intensive enterprises, manpower capital gradually becomes an essential factor in the decision of the capital structure, which has been an important topic in the studies of capital structure. Innovative enterprise is a typical manpower capital intensive enterprise. Therefore, when we discuss the financing problem of the innovative enterprises, we must take into consideration their manpower capital and analyze the effect of the nature of innovative manpower capital on the financing of these enterprises, With the specificity degree and modularization degree as two dimensions in choosing financing methods of the enterprises, this paper establishes a quartered chart to provide a unified to analyze the financing practice of the innovative enterprises.

Luan Fugui

The relationship of accounting and financial management is one of the most important accounting theory problems in our country. This paper sets forth the essence of the CASH in financial management background with the modern market economy and the new accounting standards, discusses the financial natures of the new accounting standards system in key point, recognized criterion, measure technology and reporting contents. It also analyses the inevitability from point of view of environment movement and accounting transform itself.

Research on the Special Original Document and its Standardization under new Accounting Standards environment

Geng Jianxin et al

The implication of implementing new accounting standards in China is overwhelming, which will no doubt impact the basis of daily accounting work. It is our opinion that one of the vital issues that have to be dealt with urgently is the original document related to measurement bases and its standardization under the new environment. As a result, the Paper specifically investigates special original document under new accounting standards. The Paper raises the issue, analyzes the important implications of the standardization of special original document and categories the special original Based on these analyses, the Paper puts forward views for standardizing special original document and discusses measures to ensure the implementation of this important task.

Research on Recognizing and Calculating Human Capital & it s Corresponding Human Resource

Deng Suntang

This paper researches the problems about Recognizing and Calculating Human Capital & it s Corresponding Human Resource, and considers: to recognize human capital, only after enterprise have awarded equity instruments to human resource owners; only the equity instruments are stocks, then the human capital can be credited to the Capital-Common Stock account, if they are options(stock),it should be credited to the Additional Paid-in Capital account; human resource belongs to asset, but it can t be recognized to be cost or expense immediately; human capital & its corresponding human resource should be calculated according to the equity instrument’s fare value only.

On Accounting-Based Equity Valuation: Linear Information Dynamics Perspective

Cheng Xiaoke et al

Based on classic equity-pricing theory, we put forward a method of equity valuation in the context of general linear information dynamics process, and extend equity valuation model into a more general situation with p-order information vector. This paper provides an important theory basis for exploring the relation between accounting information and equity valuation.

Corporate governance, financial condition and quality of disclosure: evidence from Shenzhen Stock Exchange

Wang Bin & Liang Xinxin

This paper analyzes the relationships between corporate governance, financial condition and quality of information disclosure (QID).Based on evaluation report s results of QID of Shen-Zhen Stock Exchange and related panel data of 1884 samples (2001-2004),we found the QID are positively related to the percentage of independent directors of the Board, stronger profitability and the size of assets of companies, negatively related to leverage. No relationship did exist between QID to companies’ ownership structures, however. QID of CEO dominated companies were lower than others with no CEO dominance.

An Empirical Study on Organizational Performance Consequences after Adopting Non-financial Measures——Agency Theory Vs Contingency Theory

Zhang Chuan et al

From 1980s,accounting theoreticians began to promote the introduction of performance evaluation systems based on non-financial measures; this paper explores the impact on organizational performance of such systems. Contingency theory and agency theory are utilized to provide bases for this exploration. Based on a sample size of 158 Chinese companies evidence suggests that the greater use of non-financial measures will lead to better corporate performance. Although there is little evidence is to prove significant correlation between performance and non-financial measure usage given different contingent factors, the research still found that companies following a cost-leadership strategy were more likely to demonstrate better performance when making greater use of non-financial measures.

Performance index, Performance risk and Pay-performance sensitivity

Chen Zhen & Zhang Ming

This text has proved that the consistency of senior executives pay and shareholders interests, namely pay-performance sensitivity, must not improve company s performance. Attempt to improve company s performance through raising senior executives pay-performance sensitivity should be determined by two factors: performance index and performance risk. Research to the medical & biological listed companies in China, we find that there is the different pay-performance sensitivity on different performance index and there isn’t consideration on performance risk in the agreement.

A Research on Critical Information Disclosure of ERP Investment in China

Zhang Ruijun et al

In recent years, ERP investment increased rapidly in China. However, though implementation of ERP system brings a lot of benefit, its complexity may give rise to high investment risk. If the critical information disclosure of such complex system program can not be open and comparable, it will increase the decision-making risk of the investors, due to the asymmetry of information. This paper discusses the status quo of critical information disclosure of ERP investment in China, presents the insufficiencies of current disclosing contents and format, and gives suggestions about the amendment of the standard on information disclosure to CSRC.

Construct Internal Control Theory: Discussion on Basic Assumption

Pan Yan & Zheng Xianping

Recently, theoretical research on internal control receives unprecedented attention from every circle. However, among those researches, few refer to internal control basic assumption. This issue explores the basic assumption of internal control, which is the basis of the internal control theory system, from three perspectives. After defining the connotation and clarifying the characteristics of internal control basic assumption, the authors propose that internal control basic assumption is composed of control entity assumption, controllability assumption, complex human nature assumption and non-collusion assumption.

A Method Research of The New Performance Budgeting Management of The University

Wang Liping et al

The article proposed a new method called D E A based Data Reduction Factor, and consider it as a method of the new performance budgeting management of the university. The article first introduced the principle of D E A based Data Reduction Factor; Second, the article take a university in west as the example to analyze the money efficiency, and have the orders of the 12 institutes in this university by using the MDEA model result. Finally, the result explained the science, feasible of this method.

Government Performance Audit: International Evolution and its Implications

Qi Zhendong & Wu Qinghua

This article examined the emergence and development of the international government performance audit, especially focused on the evolution of the audit researches, and then it given a summing up and made some remarks briefly. Based on this, the paper discussed some theoretical thinking on the government performance audit which it believed the existed misunderstands on those issues had hindered government performance audit development in China. Follow those enlightenments from foreign development, the paper insists on that national government performance audit scope should include human resources management, the appraise dimension should include equality, environment evaluation et al.

The and Characteristics of the Governmental Audit:An Explanation Based on State Theory

Liao Yigang et al

The governmental audit has different natures and serves different groups under different kinds of state. This paper, taking Locker, Olson and Barzel’s state theory model as its basis, traces the difference of the characteristics and s of the governmental audit under different state and makes an logistically consistent explanation for this topic. The conclusions of this paper will provide idealistic and solider theory for the development strategy of governmental audit in China.