The Company is a joint venture（2 Chinese citizen individuals+1 US citizen individual) who provides construction, design and installation service for manufacturing facilities. The Company has always recognized and recorded sales based on the invoice issued. However, in accordance with the PRC accounting standard, the income has to be recorded based on the progress of project i.e., percentage of completion method. In terms of the listing company requests, the Company has to re-do the income recognition based on the accounting standard.
We proposed solution:
We form a team with 3-4 members to station in the client office to collect the history documents, work with the sponsor and auditor to re-check the contracts, issued invoices, working hours and supply contracts re-calculate the sales and cost of sales in the serial 3 years and separate on quarterly basis.
The re-calculated results reflected the company’s real financial situation and agreed with sponsor and auditor.
Company Size: MNC/ Middle size/CNY800-900m annual income.
Industry: Construction/design/installation, major on manufacturing facilities. Most customers are from fortune 500.
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