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China Company Annual Report

Updated:2018-3-12 14:29:04    Source:www.tannet-group.comViews:126

China company annual report is required by PRC Company Law and other relevant regulations, which states that all Foreign Invested Enterprises (FIEs) in China, including Wholly Foreign Owned Enterprises (WFOEs), Joint Ventures (JVs) and Representative Offices (ROs) are required to comply with the statutory annual report and other compliance processes.

The enterprise shall submit the annual report to the administrative department through the public notice system of the credit information of the market subject within the prescribed period of time. The delivery date of annual report begins and ends from March 1st to June 30th each year.

Major Content of Annual Report
Implementation and change of the company's registration particulars;
Internal Auditing with the help of Audit Firm;
Contribution of the shareholder or the contributor;
External investment of the company;
Establishment of branch offices by the company;
Production and operation of the company.

Importance of Company Annual Report in China
The enterprise is responsible for the authenticity and legality of the annual report. The administrative departments may make random checks on the publicity contents of the annual reports of enterprises. The administrative authorities would punish the enterprise in accordance with the law if the annual report conceals the truth and practices fraud.

The penalties for failing to submit an annual report are also considerable. Once was listed in business exception list, the enterprise shall be restricted or banned from further financing, application for the government land supply, import and export, registration of a new company, bidding, government procurement, manufacturing production and business operation, professional qualifications application, etc. in accordance with the law.

Consequence of Non-delivery of Annual Report
Many business owners think annual reports are very troublesome. They ignore the benefits of the annual report. The implementation of the annual report system is conducive to the establishment of a fair and competitive market environment. The enterprise shall publicize the annual report to the public through the corporate credit information system, and make public the contributions of the shareholders (promoters) of the company and the status of the assets.

FIEs in China can only distribute and repatriate their profits or dividends back to their home country after completion of their annual statutory internal audits and settlement of all relevant tax liabilities.

Failure to comply with the annual report and compliance may result in extra expenses, penalties, or even revocation of business licenses.

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