Notice on the Implementation of New Accounting Standards, Changes in Accounting Policies, Correction of Prior Year Accounting Errors, and Retrospective Adjustments
In the 2008 annual audit report, the company changed relevant accounting policies in accordance with the requirements of the new accounting standards, corrected accounting errors from 2007 and prior years, and made retrospective adjustments to the relevant financial data for 2007 and earlier years. The board of directors reminds investors to pay attention when reading the company's annual report.
- Changes in Accounting Policies, Correction of Accounting Errors, and Retrospective Adjustments (1) Changes in Accounting Policies Prior to 2008, the company accrued safety production fees based on the "Interim Measures for Financial Management of Safety Production Expenses in High-Risk Industries" jointly formulated by the Ministry of Finance and the State Administration of Work Safety (Caiqi [2006] No. 478). According to this document, unspent safety production fees could be carried over to the next year. The latest interpretation of the "Enterprise Accounting Standards" in 2008 requires that unspent safety production fees be reversed and entered into surplus reserves, constituting a change in accounting policy. The company had a balance of safety production fees of CNY 1,127,329.28 at the end of 2007, which requires retrospective adjustment of the relevant items in the 2007 financial statements: reducing other payables - safety production fees by CNY 1,127,329.28 and increasing surplus reserves by CNY 1,127,329.28.