China’s Ministry of Finance (MOF) is seeking public feedback on three sets of guidelines, namely, the Guidance for Evaluating Enterprise Internal Control (Draft for Comment), the Operating Guidance for Enterprise Internal Control (Draft for Comment) and the Guidance for Appraisal of Enterprise Internal Control (Draft for Comment) (together the “Draft Guidance”). The public feedback process will end on 30 September 2008.

In line with the Guidance for Evaluating Enterprise Internal Control, enterprises should evaluate their own strategic goals, efficiency of business management, authenticity and completeness of financial statements and other related information, and their security of assets.

The main focus of the Operating Guidance for Enterprise Internal Control is to provide enterprises with guidance on the internal control of their assets.

For more information please visit http://kjs.mof.gov.cn/kjs/gongzhongcanyu/yijianzhengji/200807/t20080704_55991.html

These three sets of Draft Guidance were drafted to supplement the implementation of the Basic Guidelines for Enterprise Internal Control (the “Basic Guidelines”). Starting from 1 July 2009, listed companies will be required to adopt the Basic Guidelines, and other non-listed medium to large enterprises will also be encouraged to follow the Basic Guidelines.

Pursuant to the Basic Guidelines, listed companies will be required to evaluate the effectiveness of their internal control and disclose annual self-evaluation reports. Listed companies can also engage accountant firms qualified in securities and futures business to audit the effectiveness of their internal control.

For more information please visit http://kjs.mof.gov.cn/kjs/zhengwuxinxi/zhengcefabu/200807/t20080704_55982.html