contentsa further 245 students are studying in the second ... we look forward to your continued...
TRANSCRIPT
Honorary AdvisersPresident and Vice-Presidents of the Hong Kong Institute of Certified Public Accountants
Board MembersDoug Oxley(President)Stella P L Cho(Vice-President)Wilson Y W Fung(Vice-President)Chan Cheuk HayJohnson C H KongAndy T M LiLindy W W Yau
Editorial CommitteeLindy W W Yau(Chief Editor)Selwyn S Y Cheng(Deputy Chief Editor)Lisa S K Wong(Deputy Chief Editor)Chris K C Lau(Monitor of the Issue)Peggy P K ChanCharles K C Chiu Thomas C F ChungMichael C W Wong
Staff ResponsibleWilliam W L Fung(Assistant Director)Florence V Tong(Assistant Administrative Officer)
June 2007Hong Kong Institute of Accredited Accounting Technicians Limited香港財務會計協會有限公司
27/F, Wu Chung House,213 Queen’s Road East,Wanchai, Hong KongTel: 2823 0600Fax: 2823 0606Hotline: 2823 0660Web: www.hkiaat.orgE-mail: [email protected]
(Circulation: 7,700 copies)
Contents
HKIAAT NewsPresident’s Message 1
President’s Engagements 2
Book-keeping and Accounts Examination (Chinese) 2
New Operating Hours 2
Consultation on the proposed New Qualification Framework for the 3
Hong Kong Accredited Accounting Technicians
New Titles at HKIAAT Secretariat 4
Thanks to Our Subject Reviewers 4
Professional Bridging ExaminationTop Students in the December 2006 Examination 5
December 2007 Examination Timetable 6
Important Notes for Candidates 6
Accounting Technician ExaminationTop Students in the December 2006 Examination 8
December 2007 Examination Timetable 9
Important Notes for Candidates 11
Members’ CornerInterpersonal Skills in the Accounting Profession 12
Welcome to New Members 16
Continuing Professional Development 17
Studies in Foundation AccountingBook-keeping and Accounts Examination and 18
Computerised Accounts Examination
Enrolment for the June and July 2007 Examinations 19
Certified Accounts Clerk Qualification 20
專訪全港中學及大專院校會計個案比賽2006冠軍隊伍 21
到訪香港經濟日報集團 24
Activity HighlightsExamination Technique Seminars 25
Greenfield
Sudoku 27
Q&A 28
Features
A Case Study on Direct Labour Costs for Small and Medium-sized 29
Industrial Enterprises in China
by Dr C C Steve Fong
Salaries Tax Implications for Residents of Mainland China under 33
the Comprehensive Double Taxation Arrangement
by Dr Dora L Y Lee
Dear members and students
The consultation period for the new HKIAAT qualification framework ended on 31 May 2007. We obtained a wide range of responses from various stakeholders, especially during the briefing sessions that we organised. All the thoughtful comments and insightful suggestions were invaluable to us, and I thank all of you who had taken the time to attend our briefing sessions and written to us during our consultation period.
The HKICPA Council and the HKIAAT Board are currently carefully considering the different views received, and final arrangements are being deliberated. Please be assured that we have taken each comment into account and considered our qualification framework from the different viewpoints represented. We will strive to accommodate the needs of our various stakeholders. Watch out for the final paper on the new HKIAAT qualification framework which is expected to be announced in August this year.
We are also proud to announce that the first session of the Practical Accounting for Small and Medium Enterprises course (formerly known as Practical and Computerised Accounting for Small and Medium Enterprises) is now completed and we have 143 graduates. Congratulations to these young people who are now equipped with the capabilities to become a Certified Accounts Clerk. This course is the only accounting course in the Applied Learning Course (formerly known as the Career Oriented Curriculum) offered to senior secondary school students. A further 245 students are studying in the second cohort. We hope that this rising trend will continue, and more secondary school students will be interested in finding more about an accounting career through this useful and practical course.
As the only professional body for accounting technicians in Hong Kong, the HKIAAT will continue to develop quality professional programmes for secondary school students as well as accounting technicians who are already working in the accounting profession. We look forward to your continued support of the HKIAAT in the future.
President’s Message
Doug OxleyPresident
HKIAAT News
2
President’s Engagements
The President and other representatives of the HKIAAT attended the following events during May and June 2007:
• Hong Kong Baptist University Society of Accountancy Inauguration Ceremony
• The University of Sydney Alumni and Friends Dinner
• Certified Management Accountants Society of British Columbia, Hong Kong Branch – Annual Dinner 2007
• Hong Kong Institute of Vocational Education (Chai Wan), Department of Business Administration -“BA Gala Dinner 2007”
Book-keeping and Accounts Examination (Chinese)
With effect from 2007, the Book-keeping and Accounts Examination Chinese Paper (中文簿記與會計考試) will ONLY be offered in the June examination session. The HKIAAT will closely monitor feedback from students and course providers and will consider reinstating the December session if appropriate.
New Operating Hours
The HKIAAT will adopt a five-day working week for the Secretariat effective from 1 July 2007. Please be assured that there will be no reduction in service. The reception counter and library will extend its hours to 6 pm on weekdays and remain open on Saturday morning.
The new operating hours (effective from 1 July 2007) are as follows:
Counter ServiceMonday to Friday
9:00 am – 6:00 pm
Saturday
9:00 am – 12 noon
LibraryMonday to Friday
9:00 am – 7:00 pm
Saturday
9:00 am – 12 noon
Main OfficeMonday to Thursday
9:00 am – 6:00 pm
Friday
9:00 am – 5:30 pm
HKIAAT News
�Consultation on the proposed New Qualification Framework for the Hong Kong Accredited Accounting Technicians
The consultation on the proposed New Qualification Framework for the Hong Kong Accredited Accounting Technicians, issued by our parent institute, the Hong Kong Institute of CPAs, ended on 31 May 2007.
During the consultation period, we organised three briefing sessions for various stakeholders including our members/students, course providers, employers and the general public. The aim of the briefing sessions was to enable our stakeholders to understand our proposals and provide a forum to freely exchange their views. Over 200 participants attended the sessions. Many of them believed that the new qualification framework will enhance the status of the AAT qualification in Hong Kong, which in turn will help our members/students in their career development. Some of them expressed their views on the spot and their constructive comments and suggestions are now being considered by the Hong Kong Institute of CPAs Council and the HKIAAT Board.
It is intended that the final paper on the new HKIAAT qualification framework will be announced in August this year on our website.
Many members and students attended the briefing sessions. Ms Georgina Chan, Executive Director (Qualification) of the Hong Kong Institute of CPAs, introducing the proposed new qualification framework to the audience.
Mr Jonathan Ng, Director of Student Education & Training of the Hong Kong Institute of CPAs, explaining the transitional arrangements.
Book-keeping and Accounts Examination (Chinese)
Course providers, one of our major stakeholder groups, were invited to attend the briefing sessions.
HKIAAT News
�
New Titles at HKIAAT Secretariat
Since the inception of the Hong Kong Institute of Accredited Accounting Technicians Limited (HKIAAT), it has received tremendous manpower and logistical support from its parent body, the Hong Kong Institute of Certified Public Accountants (HKICPA). Behind the scene, many staff members of HKICPA have contributed their time and effort to support HKIAAT’s operations and activities.
The HKIAAT Board would like to formally recognise the positions of HKICPA executives who are involved in the day-to-day management of the HKIAAT operations and to allow respective staff to sign relevant documents of HKIAAT in a proper capacity as and when necessary. The following titles for HKIAAT Secretariat are now in place:
Title at HKIAAT Name of Staff Position at HKICPA
Institute Secretary (no change) Ms Winnie Cheung Chief Executive and Registrar
Executive Director (new) Ms Georgina Chan Executive Director
Director (new) Mr Jonathan Ng Director, Student Education & Training
Assistant Director (new) Mr William Fung (see note 1) -
Taking advantage of the removal of HKIAAT office to be in the same premises as the HKICPA, there will be further integration in manpower and resources, to tap greater synergies for the two organisations working together. This should enhance operational support as the HKIAAT moves to implement its New Qualification Framework, following the consultation that closed on 31 May 2007.
Note:
1. Mr William Fung replaces Ms Grace Leung who left the HKIAAT on 4 June 2007.
Thanks to Our Subject Reviewers
Articles published in the Features column during the first half of 2007 were reviewed by the following subject specialists:
• Mr James Kong James T W Kong & Co
• Mr Danny Mak Hong Kong Institute of Vocational Education (Haking Wong)
• Mr Andy Li Hong Kong Institute of Vocational Education (Chai Wan)
On behalf of the HKIAAT, the Editorial Committee would like to take this opportunity to thank all the reviewers for their assistance in devoting their valuable time to this task.
Professional Bridging Examination
�
Top Students in the December 2006 Examination
Paper I – Financial Reporting
Tsui Kin Ho
Mr Ho was granted full exemption from the Accounting Technician Examination in May 2006. This was the first time he sat the Professional Bridging Examination. He is now working as an audit intermediate at CCIF CPA Limited.
Thoughts from Mr Tsui:
I am glad to be the top student in this paper. In my opinion, understanding the concepts and accounting techniques in each topic is essential for passing the exam. Practising various questions is very useful in addressing my weaknesses and refining examination skills.
Paper II – Management Accounting
Pang Lai Shan
Ms Pang was a graduate of the Accounting Technician Examination in December 2005 and has completed the Professional Bridging Examination in December 2006. She studied at the VTC Institute of Professional Education and Knowledge when preparing for this examination and is now working as an accountant in Far East Consortium Ltd.
Thoughts from Ms Pang:
I am glad to receive the top student award for this paper and I would like to take this opportunity to thank those who have always supported me, especially my husband.
My study method is to pay attention in class and to practise on past papers. If my answer is different from the suggested answers, I always check the differences and review the teaching notes in order to understand the concept rather than only memorising the correct answers.
In addition, I found that being attentive and having a well-organised mindset is very important in my studies and career.
Paper III – Financial Management
Qiu Yin Qi
Mr Qiu was granted full exemption from the Accounting Technician Examination in March 2005 and completed the Professional Bridging Examination in December 2006. He obtained the Higher Diploma in Accountancy from the Hong Kong Institute of Vocational Education (Chai Wan) in 2004.
Thoughts from Mr Qiu:
I am surprised and honoured to receive the top student award in Paper III – Financial Management.
Three years ago, I touched on the subject of financial management for the first time in my studies at IVE. I felt this subject was quite difficult and involved many different topics. At that time, I simply memorised the topics before taking the exam, so I only managed to pass it.
The second time I encountered this subject was preparing for this paper. I found that I had a better understanding second time round and was able to apply my skills in different situations. I suggest that students who wish to improve their performance should read the same topic at least twice and practise all of the past papers at least three times. Rewards come from hard work.
Professional Bridging Examination
6
December 2007 Examination Timetable
Paper Date Time
Paper I – Financial Reporting 6 December 2007 (Thursday) 2:00 pm – 5:00 pm
Paper II – Management Accounting 8 December 2007 (Saturday) 2:00 pm – 5:00 pm
Paper III – Financial Management 13 December 2007 (Thursday) 2:00 pm – 5:00 pm
Paper IV – Legal Environment 15 December 2007 (Saturday) 2:00 pm – 5:00 pm
Important Notes for Candidates (From June 2007 Results Announcement to December 2007 Examination Entry)
Date HKIAAT Action Candidate Action Remarks
The third week of August 2007
For students who have entered the June 2007 examination:
A combined Examination Results Report together with Status Report AND Examination Entry Form will be despatched.
Upon receipt of the Examination Results Report and Examination Entry Form, students must check that all details contained in the documents are correct. If any of the data is incorrect, students should contact the HKIAAT IMMEDIATELY.
SCRIPT REPORT SERVICE
If a student wishes to have a written report on his/her performance, he/she should make a written application within 2 weeks from the date of announcement of the results and send this, together with the payment of a non-refundable fee of $680 per paper, to the HKIAAT.
Verbal, late or incomplete applications will not be accepted.
The HKIAAT will NOT deal with enquiries about the examination results.
Students should note that the script report service is NOT a re-marking exercise. It is purely an exercise to let the student know his/her performance in the examination.
For students who have not entered the June 2007 examination but are on the HKIAAT Register before 15 July 2007:
An Examination Entry Form will be despatched to students.
Upon receipt of the Examination Entry Form, students must check that all details contained in the document are correct. If any of the data is incorrect, students should contact the HKIAAT IMMEDIATELY.
For students who have successfully completed the Professional Bridging Examination in the June 2007 sitting:
An Examination Certificate will be ready for collection 3 months after the results are released.
Professional Bridging Examination
7
Important Notes for Candidates (From June 2007 Results Announcement to December 2007 Examination)
Date HKIAAT Action Candidate Action Remarks
31 August 2007 Students who have not received the Examination Report and/or Examination Entry Form or have misplaced them should contact the HKIAAT IMMEDIATELY for a duplicate copy.
No duplicates will be issued to students after 30 September 2007 (the deadline for Examination Application).
30 September 2007 Closing date for examination applications for the December 2007 examination.
CITY U OF HK
Accounting Technician Examination
�
Top Students in the December 2006 Examination
Paper 1– Financial Accounting
Wan Fung Chun
Miss Wan is now taking the Diploma in Accounting Studies at the Hong Kong School of Commerce. This was her first attempt at the Accounting Technician Examination.
Paper 2 – Business Communication
Wong Kwok Fai
This was the first time Mr Wong had taken the Accounting Technician Examination.
Paper 3– Cost Accounting
Wong Kwok Kuen
This was Mr Wong’s first attempt at the Accounting Technician Examination. He is now an audit staff member at Lawrence Tse & Co.
Paper 4 – Information Technology Applications in Accounting
Wan Yin Ki
Miss Wan holds a Higher Diploma in Business Administration offered by the Hong Kong Institute of Vocational Education (Kwun Tong). She studied for this paper at City University of Hong Kong (SCOPE). She is now working as an account clerk at KTB Limited.
Thoughts from Miss Wan:
I am glad to have been given the top student award of this paper. I think practicing is very important. Reading the questions carefully also helps you achieve better performance. I hope my experience is useful for other HKIAAT students.
Lastly, I would like to thank the lecturers at SCOPE for their patient teaching.
Paper 5 – Hong Kong Taxation & Paper 6 – Hong Kong Business Law
Ip Wai Chong
Miss Ip is the top student in both Paper 5 and Paper 6. She also received an award in December 2005 for her outstanding performance in Paper 1. She is currently studying the HKIAAT Certificate Programme in Accounting Studies at the Hong Kong Management Association (HKMA) and is working as an executive secretary at N H Consultants Co Ltd.
Thoughts from Miss Ip:
I am delighted to receive this award as it is a great recognition of my effort.
I sincerely thank Mr Francis Chung of the HKMA for his guidance, encouragement, and patience during my studies. I was blessed to have him as my teacher.
Mr Chung was conscientious in teaching and well prepared for his lessons. He guided me through my studies and built my confidence in passing the examination. I would like to share this glory with him.
Accounting Technician Examination
�
Paper 7 – Advanced Accounting
Fok Tat Choi
Mr Fok is now studying the Diploma in Accounting Studies at the Hong Kong School of Commerce. This was the first time Mr Fok sat the Accounting Technician Examination.
Thoughts from Mr Fok
I would like to thank HKIAAT for giving this award to me. Like most of the top students, I put a lot of effort in my preparations for the examination.
My study method is common. I try to grasp the big picture of the topic at first, and then fill in the details. After that, I make a summary in my own words. This process helps cement what you have studied into your brain, so that you will find the topic easy to revise. Don’t just rely on reviewing past paper and believe that will get you pass. It is not the right attitude to learn.
In my opinion, self-discipline is of utmost importance.
Finally, I would like to take this opportunity to thank my lecturer, Ms Angela Nip, for her invaluable assistance. She is patient, enthusiastic and willing to help students.
Paper 8– Auditing
Lam Kwok Kai
This is the second time that Mr Lam wins a top student award. He also received the award in June 2005 for his outstanding performance in Paper 5.
Thoughts from Mr Lam:
I am glad to receive the top student award in this paper.
When I studied for this paper, I went through the syllabus carefully, focusing on the most important topics first and allocating my time accordingly.
The HKIAAT study text was very helpful and assisted me in understanding the topics in a quick and easy way. After practising on a few past papers, I gained the skills needed in time management and question-answering techniques.
May I take this opportunity to thank my former lecturers at the Hong Kong School of Commerce who taught me during the1990s. Their enthusiasm and professional teaching impressed me very much.
December 2007 Examination Timetable
Date
Time
Friday,
30 November 2007
Saturday,
1 December 2007
Friday,
7 December 2007
Saturday,
8 December 2007
9:30 am
– 12:30 pm
Paper 1 -
Financial Accounting
Paper 5 -
Hong Kong Taxation
Paper 2 -
Business Communication
Paper 3 -
Cost Accounting
2:00 pm – 5:00/5:30 pm*
Paper 7 -
Advanced Accounting
Paper 4 -
Information Technology Applications in Accounting*
Paper 8 -
Auditing
Paper 6 -
Hong Kong Business Law
* DacEasy Accounting for Windows v. 11 (English version) and Microsoft Excel 97 (or higher version) (English/Chinese versions) will be
used in the Paper 4 examination. Please note the time allowed for this paper is 12 3 hours (2:00 pm to 5:30 pm).
FTC AD
Accounting Technician Examination
11
Date HKIAAT Action Candidate Action Remarks
The third week of August 2007
For students who have entered the June 2007 examination:
A combined Examination Results Report together with Status Report AND Examination Entry Form will be despatched.
Upon receipt of the Examination Results Report and Examination Entry Form, students must check that all details contained in the documents are correct. If any of the data is incorrect, students should contact the HKIAAT IMMEDIATELY.
SCRIPT REVIEW
If a student wishes to have his/her script reviewed, he/she should make a written application within 2 weeks from the date of announcement of the results and send this, together with the payment of a non-refundable fee of $330 per paper, to the HKIAAT.
Verbal, late or incomplete applications will not be accepted.
The HKIAAT will NOT deal with enquiries about the examination results.
Students who make a review application are reminded that the review result is final and conclusive.
For students who have not entered the June 2007 examination but are on the HKIAAT Register before 15 July 2007:
An Examination Entry Form will be despatched to students.
Upon receipt of the Examination Entry Form, students must check that all details contained in the document are correct. If any of the data is incorrect, students should contact the HKIAAT IMMEDIATELY.
31 August 2007 Students who have not received the Examination Report and/or Examination Entry Form or have misplaced them should contact the HKIAAT IMMEDIATELY for a duplicate copy.
No duplicates will be issued to students after 30 September 2007 (the deadline for Examination Application).
30 September 2007 Closing date for examination and exemption applications for the December 2007 examination.
Important Notes for Candidates (From June 2007 Results Announcement to December 2007 Examination Entry)
Members’ Corner
12
Interpersonal skills involve an array of skills that can be adapted to specific situations. Mostly these are used to enhance interpersonal relationships such as in teamwork, in forming alliances, and so on. Other interpersonal skills are used to enhance self-confidence and influence in business in areas such as conflict management, negotiation and leadership.
Some aspects of interpersonal skills with an external focus include understanding other people’s viewpoints, getting along with others, dealing with difficult people and dealing with criticism. Others are more internal and drive us to examine our personality and motives.
“The ‘Inside-Out’ approach to personal and interpersonal effectiveness means to start first with self; even more fundamentally, to start with the most inside part of self -- with your paradigms, your character, and your motives.”
- Stephen R. Covey
Some interpersonal skill development is packaged into offsite seminars and highly structured training programmes spanning 20 hours or more. These typically cover communication, perception, the concept of self, expressing emotions, verbal and non-verbal skills, listening and feedback, assertiveness, and negotiation and teamwork. Some are even enriched with adventure and experience training to let participants get first-hand experience of the need for good interpersonal skills.
This article looks at the fundamentals of interpersonal skills from an instrumental viewpoint. Through this simple framework, we shall get a glimpse of how to enhance our interpersonal skills as accounting professionals.
Why be concerned?Before reading on, pause for a moment and ask yourself why you should be concerned with acquiring interpersonal skills. Got it?! OK, now read on.
An organisation functions because the people in it function. Interpersonal skills are just like lubricating oil. They help us develop and maintain a collaborative culture within the organisation as well as the other organisations it interacts with. Be it internal clients, or external clients, we all need to build trust and confidence in our daily work, align our goals with those of our colleagues, be on good terms with suppliers and service providers, and meet their expectations as much as we want them to meet ours. The success of an interpersonal relationship is therefore sometimes measured by the level of trust and commitment among all the stakeholders. Accounting professionals are some of these stakeholders.
Interpersonal Skills in the Accounting ProfessionWilliam Tong, MBA, CPA
Dos and Don’ts before you get startedBefore engaging in person, see if the following considerations will help you find an appropriate opportunity to build trust and confidence to the level you wish. Among all the criteria to be considered are the following:
• The right time – Wait for your opportunity carefully. Do not try to start a serious conversation when you or your counterpart is in a hurry. If you are not sure of the situation, find out by asking politely for an appointment or a better time to speak. If you are being approached, try to think in the other person’s shoes. He/she wants to talk to you. A golden opportunity has arisen.
• The right person – If you wish to look for solutions, speak to the person who has the authority to give you the response you need. Unless you are only seeking an emotional outlet, dealing with a person without authority will not lead you anywhere. And if you are not the person with the appropriate authority, you should pass on the request through a friendly referral. This is often appreciated. Using just a simple “no” or “I don’t know” spoils the chance of improving your relationship with the questioner.
• The right place – Conversations conducted in your own office or in the other person’s office carry different meanings. Consider whether speaking in private is a better choice than doing it in public, if the matter requires the privacy. You would not want to discuss your budget or do your variance analysis in the lift or in the washroom.
• The right atmosphere – What better time is there to reinforce collaboration than when you are having a good time with your colleagues? Compare this with being overly eager to “lecture” when your colleague has experienced a set-back: this will only lead to alienation. Build rapport with your non-verbal language. You can also paraphrase to let the other person know that you understand the situation and wish to pick the most appropriate time to talk.
• The right topic – Present your views in terms of the needs of your colleagues. Show them your genuine wish to see things from their perspective. Do not coerce with what you want them to do, but see if what you need aligns with their goals too.
• The right mood – Beware, “a hot temper leaps o’er a cold decree.” (Shakespeare) Ride the waves of emotion by managing it, be it your own emotion or that of your colleagues.
• The right approach – Do consider humour but make sure you do not over-do it to spoil your professional image.
Members’ Corner
1�Dos and Don’ts at the engagement
• Active listening – Listen, not only for information but also for emotional needs. Do not “spare” a minute or two for your colleagues while you work on other matters. Give them full attention while at the same time making sure that you can keep the conversation short. After all, you have a lot to do.
• Choice of the right word – Use positive words all the time. This is your lifesaver especially at times when you are dealing with a hostile attitude from your colleagues. The little secret of using positive words is to think positively. Your mindset and attitude are the real sources of power. Drop the habit of using any negative words. For example, try to avoid starting a conversation with “I am sorry, can I interrupt?” if you are not really interrupting. Instead say with a smile, “Hi, I wonder if I can have a few minutes with you.”
• Reacting to the response – Take a slow breath and be mindful of the response. Most interpersonal relationships are ruined by impulsive responses. Try to figure out how you can facilitate a positive outcome, especially when you need teamwork.
• Coming to conclusion – Remember to agree on a course of action before you end your conversation. You need to execute your tasks at the end of the day, and you want responsibility clearly marked out.
Nailing down to a follow-up after the engagement
• Appropriate follow up – We all tend to be forgetful, especially when we have so much to do. Protect the relationship by not allowing “oversights” to be interpreted as willful acts of non-cooperation. Follow up according to the timeframe as agreed.
• Laying the foundations for future engagement – Rome was not built in one day. The same is true of relationships. Remember that each relationship needs nurturing. Every contact episode is an opportunity for you to build a stronger network. Do not give this up by taking a short-sighted approach.
• Extending your network – Interpersonal networks radiate. Keep every encounter nice and tidy and you will be rewarded with an extended network. Use email to express your pleasure and gratitude at the engagement.
Personal styleThe style of our interpersonal skills depends significantly on our self-identity. As accounting professionals, we take into account our professional image and the organisations that we
identify with. While we extend ourselves to others through our communication, we also extend our personality. We let the other party have direct experience of our competence through the words that we chose, and of our trust through the psychological distance we hold between ourselves and them.
Gender differences Yes, you want to be nice most of the time. It is better to make friends than foes. But how nice can you be or want to be? You do not want to give the impression that you are over-zealous or closer than you are prepared to. Be mindful of the gender difference in interacting with your colleagues. It is interesting to note the subtle difference in contact between the genders. Use this difference to build trust and do not end up with sexual harassment complaints.
The masteryWhen you are ready to master your interpersonal skills, challenge yourself with the interplay of both verbal and non-verbal language. Watch the distance you stand from your colleagues when talking to them. Watch your colleague’s response to see if it is an approaching or avoiding response. Eye contact will tell you a lot about what you want to know about psychological distance, and how well you are doing to create and maintain trust.
Limitations in the training of accounting professionals?!Why do many accounting professionals give the impression that they are not easy to get along with? They can seem too stern,
YMCA Ad
Members’ Corner
1�
too rigid and to have little compassion. The reasons would appear to lie in the nature of the accounting profession and its practice. Accounting professionals are trained to “follow the book”. They have to comply with many rules and regulations, from Accounting Standards to statutory requirements such as company law and tax law.
The intense and repetitive nature of this work requires a concentrated focus and an analytical approach. This can give the impression that accounting personnel are less people-oriented and are not so concerned with the impact of their work on the emotions of their colleagues. Accounting professionals can take a judgmental position given their duty as gatekeepers. For all these reasons, we need to master interpersonal skills all the more to facilitate smooth information flows. This is particularly important when we come to present reports, whether they are for external or internal audit purposes. A nurturing atmosphere gives us an edge as we handle ad hoc exercises, because this is when people are required to step out of their own comfort zone to collaborate with us.
Despite the training and the nature of work, would it therefore not be to our benefit for us to interact with people to meet their emotional needs? It is a myth among junior staff to think that interpersonal skills are only expected from people in a more senior position. In fact, since interpersonal contact is an art, it can only be mastered through repetitive use and deliberate contemplation until it becomes a habit. When you realise that the opportunity to practise is everywhere and at all levels, perhaps you will find yourself eager to practise it whenever you have the chance to do so.
Are these transferable skills, even in writing?Environments change, behaviour changes, but the principles of the skills set remain more or less the same. These principles are not restricted to behaviour in person. In fact, you can easily adapt them to your written communication. Writing can be used as a tool to develop interpersonal relationships,
and this requires a skilful use of words. However, note that communication through written words does not have the same impact as communication in person because it does not use the visual, auditory, kinesthetic, olfactory and gustatory senses. Writing also has the shortcoming of possible misconceptions by the reader. The best advice is to keep your written communications short and precise to minimise any misunderstanding. After all, interpersonal skills are supposed to enhance rather than to bring negative effects to interpersonal relationships.
Developing interpersonal skills by modellingIt takes a lot of imagination and guesswork to figure out how to conduct oneself in terms of behaviour. The best way to learn interpersonal skills is to attend workshops where personal guidance can be given and behaviour commented on. Reading books and watching training videos are other alternatives, though these forms of learning suffer from a lack of interaction between the learners.
Now is the time for you to decide whether you want to brush up your interpersonal skills.
About the author
William Tong is an executive and life coach. He has enjoyed a multi-disciplinary career. Not only is he an accounting professional and a business executive, but he is also a certified clinical hypnotherapist from the United States. He has studied how the brain functions in the context of learning. He is now a professional trainer in management soft skills and he coaches executives and business owners in their pursuit of excellence. As a project manager of a MNC, he provides expert advice on the final screening of executive trainees recruited from top universities. Since 1998, he has also been a mentor to many local university students. Last year, he was featured in the Tuesday Report on TVB Jade on the subject of life coaching. He can be reached at [email protected].
Members’ Corner
16
AssociateAssociateAu Wai YiChan Ka Yin SallyChan Tsz YanChan Yun KiuCheng Kin FaiCheung Ka PoCheung Sui FaiChim Wai YanChung Siu LanFong PunHo Yat ChauHui Kar ChunKei Chuen FungLai Ka WaiLai Kwok FungLam Mei KitLau Chi YungLau Wing SumLee Lai SeeLee Mei SzeLee Pui YuLeung Ka LungLeung Wai LingLeung Yee ManLeung Yuen KiLi Ka Wun
Welcome to New MembersThe HKIAAT would like to extend its warmest welcome to the following new members:
Li Ming YanLiu Wai InLou Pui YuNg Man FaiNg Tsz WanNg Wing YinOr Kin BunTam Pui Shan TeresaTam Wing SumTang Lun CheungTo Wan ChiWan Wai KuenWong Ho LamWong Shuk PingWong Tai Ho KarenWong Wai YinWong Wing SzeWong Wing SzeWong Yin KwanWong Ying KinWu Man NgaiYim Sau PingYip Fung TingYip Lee Wa GloriaYip Pui YuYu Chi WingYuen Kwong Hung
Our membership base has now grown to over 1,300! If you’re not already a member, what are you waiting for? Come and join the AAT family NOW! Just complete and return the reply slip below to us and we’ll send you an application form. The form can also be obtained from our office, via our hotline 2823 0660 or from our website www.hkiaat.org.
To: HKIAAT (Fax No: 2823 0606)
I am interested in becoming an HKIAAT member. Please send me an application form.
Name (Mr/Ms/Miss/Mrs):
Student Registration No.: Year of Graduation:
Address:
Contact Phone No. (Day-time): Fax No.:
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Members’ Corner
17
Continuing Professional Development
The Hong Kong Institute of CPAs (HKICPA) is organising the following Continuing Professional Development (CPD) Programmes in July and August 2007. Our members enjoy the same fee as HKICPA members and students. Apart from regular seminars and conferences, there are also e-learning programmes, workshops on soft skills and courses of longer duration on Putonghua. If you are interested and would like to enroll in these programmes, please visit the HKICPA website on professional training at http://www.hkicpa.org.hk/membership/cpd/activities/activities.php.
Date and Time Topic Format Language Fee4 July 2007
6:30 pm – 9:30 pmUsing Persuasion in Sales Proposals Seminar English $400
9 July 2007
6:30 pm – 8:00 pm
Unchained Wireless Network: Convenience and Risks – from User Perspective
Seminar Cantonese $180
10 July 2007
6:30 pm – 8:00 pmMainland Law on Property Right Seminar Putonghua $200
10 July 2007
6:30 pm – 8:30 pm
Establish Business in Macau 會計師如何協助客戶在澳門開設業務
Seminar Cantonese $180
11 July 2007
6:30 pm – 8:00 pmChina Tax Reform – Major Change Descends on China Seminar English $180
12 July 2007
6:30 pm – 8:30 pmSOX 2007 Update Seminar English $200
13 July 2007
6:30 pm – 8:00 pmExpatriate Tax Issues Seminar English $180
14 July 2007
9:30 am – 5:00 pmInformation – The Third Resource Workshop Cantonese $1,350
16 July 2007
6:30 pm – 8:00 pm
Tax Planning under the PRC – HK Tax Agreement – a Hong Kong Perspective
Seminar English $180
17 July 2007
7:00 pm – 8:00 pm
TUE No.710 – Exposure Draft of IFRS for SMEs – Is it suitable for Hong Kong?
Seminar English $120
20 July 2007
6:30 pm – 8:30 pmBusiness Brokerage for SMEs in Hong Kong Seminar Cantonese $180
21 July 2007
9:00 am – 5:00 pm
Challenges of the New Managers: The Earliest Test of Leadership in Their New Roles
Workshop Cantonese $1,350
23 July 2007
6:30 pm – 8:00 pmUnderstanding H-shares Index Futures and Options Seminar Cantonese $180
24 July 2007
6:30 pm – 8:00 pm
Managing Cultural Difference When Working with Chinese Managers and Their Team
Seminar Cantonese $180
26 July 2007
9:00 am – 5:00 pm
Boost Your Presentation IQ: Improve Presentation Skills, Gain Confidence & Get Results (re-run)
Workshop Cantonese $1,350
26 July 2007
6:30 pm – 8:30 pmNegotiating Rationally Seminar Cantonese $180
28 July 2007
9:00 am – 5:00pm
Beyond Win-Win: Using Emotion as Your Tool for Negotiation
Workshop Cantonese $1,350
30 July 2007
6:30 pm – 8:00 pm中國証券公司的綜合治理 Seminar Cantonese $180
6 August 2007
6:30 pm – 8:30 pm
Key US Tax Issues for Private Equity and VC Funds with US Investors
Seminar Cantonese $180
10 August 2007
9:00 am – 5:00 pm
Negotiation 101: Effective Negotiation Skill to Enrich Your Work & Social Life (re-run)
Workshop Cantonese $1,350
Studies in Foundation Accounting
1�
Book-keeping and Accounts Examination and Computerised Accounts Examination
Top Students in the December 2006 Book-keeping and Accounts Examination
Wong Ka Pui
Miss Wong is a school candidate from Pentecostal Lam Hon Kwong School and is a full-time student studying for the Hong Kong Advanced Level Examination.
Thoughts from Miss Wong:
I am very glad to be a top student in the December 2006 Book-keeping and Accounts Examination. Learning accounting has made me understand that there is no shortcut in this subject: in fact, practice makes perfect. You have to grasp all the principles by trying many different cases and applying them to practical situations. As the saying goes “You reap what you sow”. I recommend future students wisely invest time and effort in preparing for the exam, in this way you can pass with flying colours in the near future.
Wong King Peng
Mr Wong is a student of La Salle College studying for the Hong Kong Advanced Level Examination.
Thoughts from Mr Wong:
I believe that no matter what you do, as long as you have stamina and perseverance, you will succeed. This has been my motto for as long as I can remember, and it has worked for me every single time I have prepared for an examination. In addition, time management is definitely a crucial element to preparing for exams. Revision is very important, yet you must be sure to include leisure time in your time-table. This is the key to effective studying, resulting in bringing you another step closer towards your personal goals.
Lam Wing Hung
Mr Lam is a school candidate from Po Leung Kuk Tang Yuk Tien College studying for the Hong Kong Advanced Level Examination.
Thoughts from Mr Lam:
Being a top student of the December 2006 Book-keeping and Accounts Examination is a great honour for me. My thanks go to the HKIAAT, my parents and college. Without them, I could never have succeeded. They have supported and helped me a lot.
My short-term goal is to enter one of the well-known universities in Hong Kong and to further my studies. In the long term I wish to be a successful businessman and professional who can help to develop Hong Kong.
My study method includes listening to my teachers’ advice and practising as much as possible. These methods are not that special and everyone can make use of them to strive for success. Take responsibility for your life! I wish you every success in your future endeavours.
Chan Yuk Yin
Miss Chan studied Book-keeping and Accounts at the Hong Kong Management Association in 2006. She is now working as a treasury coordinator at Sime Darby Hongkong Finance Limited.
Thoughts from Miss Chan:
It is my great pleasure to be awarded a top student prize in this paper. This recognition of my achievements drives me to study further in order to be well-equipped to take on more challenges in the future. I would like to share my joy with those who have encouraged and supported me on the way. My bosses, Ms Judith Leung and Mr C S Wong, have been very kind. Their trust and encouragement in helping me acquire a better knowledge of accounting are much appreciated. I would also like to thank my teacher, Ms Angela Ng, whose clear and organised instructions have enabled me to understand accounting principles. I cannot lay claim to any unique study method: what I did was simply practise as many past papers as possible in order to cover more topics, and to pay heed to the answering techniques.
Studies in Foundation Accounting
1�
Enrolment for the June and July 2007 Examinations
A total of 303 candidates registered to sit the June 2007 Book-keeping and Accounts Examination. Out of them, 84 candidates sat the Chinese paper. Meanwhile, 185 candidates have registered for the July 2007 Computerised Accounts Examination.
Examination Entry Acknowledgements and Examination Attendance Dockets for the above examinations were sent to schools or candidates in May and June 2007 respectively. Students should inform the HKIAAT in good time if they have not received an Examination Attendance Docket or have misplaced it.
Examination Examination Date & Time Application Deadline Fee
December 2007 Book-keeping and Accounts Examination (English)
15 December 2007
2:00 – 5:00 pm15 October 2007 $300
Book-keeping and Accounts Examination (Chinese)
The Book-keeping and Accounts Examination Chinese Paper will ONLY be provided in the JUNE SESSION with effect from 2007. The HKIAAT will closely monitor feedback from students and course providers and will consider reinstating the December session if appropriate.
January 2008 Computerised Accounts Examination
12 January 2008
2:30 – 5:00 pm31 October 2007 $430
Applications for examination entry are accepted throughout the year. It takes 3 weeks to assess the applications and to send confirmation letters. Please ensure that your residential address is correct and you can be reached by mail. It is your responsibility to notify us of any change to your personal details in good time. If you find any discrepancies in the information sent to you, please contact us immediately.
Top Students in the January 2007 Computerised Accounts Examination
Ngok Mei Fung
Ms Ngok studied at the Hong Kong School of Commerce for MYOB Level 3 in 2006. She is now working as an assistant accounts and administration manager at Kongdu Engineering Limited.
Thoughts from Ms Ngok:
Last year, I spent a great deal of time in studying and sitting for examinations. I felt under a great deal of pressure! I only wanted to pass the examinations, and it never crossed my mind that I could be a top student. I must thank my teacher, Mr Tommy Choi of the Hong Kong School of Commerce, who happily shares his professional knowledge in teaching all his students.
Lo Kwan
Miss Lo studied MYOB at the Hong Kong School of Commerce in 2006. She is now an accounts clerk at Hallen Textile Limited.
Thoughts from Miss Lo:
I am very happy to have been selected as a top student of the January 2007 Computerised Accounts Examination. Firstly, I need to thank the HKIAAT very much for giving me the chance to take the examination. I would like to acknowledge my debt to my teacher, Mr Tommy Choi of Hong Kong School of Commerce. Mr Choi is a witty and humorous teacher. In his class, I learned a lot about MYOB and how to apply the programme in my daily work. Finally, I would like to thank my parents for their support and care.
Please make sure to keep the following in mind: learning is easy if you are interested in the subject matter.
Studies in Foundation Accounting
20
The 5 new Certified Accounts Clerks who have successfully completed both the Book-keeping and Accounts Examination and Computerised Accounts Examination are:
Chu Sin Hang
Lee Sze Man
Tang Hoi Ping
Tang Tsz Yan
Wong Wing In
The 138 graduates of the Career Oriented Cirriculum Course (2005-07 Cohort) - Practical and Computerised Accounting for Small and Medium Enterprises - who have been awarded the CAC qualification are:
Au Chun Keung
Chan Ching Wa
Chan Ho Yin
Chan Hon Lam
Chan Ka Ho
Chan Ka Lok
Chan Sze Yam
Chan Tsz Mei
Chan Wai Keung
Chan Wing Ping
Chan Wing Shan
Chan Yu Ling
Chang Hoi Ki
Chau Tsz Ching
Cheng Sin Wa
Cheung Chin Ling
Cheung Ho Yan
Cheung Ka Ming
Cheung Long Sang
Cheung Siu Mun
Cheung Wan Pong
Certified Accounts Clerk Qualification
We are pleased to announce that 143 candidates have been awarded the Certified Accounts Clerk (CAC) qualification.
Cheung Yuk Fan
Cheung Yuk Ha
Choi Kin Wing
Choi Man Wai
Chow Shing Tung
Choy Kimberly Wei Kay
Chu Ka Po
Chu Man Ying
Chu Wan Mui
Chung Mong Ying
Don Mun Min
Fok Ka Wai
Ho Ka Hong
Ho Lok Lam
Ho Shuk Han
Hui Ka Man
Hung Ka Yu
Hung Tik
Kong Man Yiu
Koo Sheung Chi
Kwan Shing Yan
Kwok Hoi Fung
Kwok Sin Yan
Kwok Tsz Chun
Kwok Wai Leong
Kwok Wing Shan
Kwong Yau Yin
Lai Sin Ting
Lai Ting Sum
Lam Ka Wai
Lam Yuk Shing
Lau Hau Ling
Lau Hing
Lau Hoi Kwan
Lau Ka Wai
Lau Wai Kam
Law Chak Hin
Law Man Chun
Law Shuk Man
Law Wai Yip
Lee Chung Ming
Lee Hiu Lai
Lee Siu Shing
Lee Wai Chun
Leung Cheuk Wai
Leung Chi Hang
Li Chun Kit
Li Ka Hei
Lo Chun Kit
Lo Chung Kan
Lo Hin Ching
Lo Wing Tung
Lui Ka Kit
Man Yin Lam
Man Ying Kit
Mau Siu Lai
Mo Kwan Lok
Mo Mei Yuk
Ng Ka Fai
Ng Kin Ling Koei
Ng Kin Tat
Ng Man Sze
Ng Siu Chu
Ng Siu Man
Ng Wing Lun
Ng Yuk Ha
Ngai Tan Ching
Poon Ka On
Poon Shuk Kuen
Sit Ronica
Siu Chung Man
Siu Man Hin
So Siu Hang
Tam Choi Man
Tang Ho Tai
Tam Ka Ian
Tang Mei Chu
Tin Ka Chun
To Chun Cheuk
Tong Ying Kit
Tsang Chun Kit
Tsang Sin Man
Tse Ka Lok
Tse Ki Fung
Tse Pui Yi
Tsui Ho Yin
Tsui Yee Man
Wai Fong Hang
Wong Chi Hang
Wong Ching Tsz
Wong Chun Hei
Wong Chun Leung
Wong Ho Wing
Wong Hoo Yin
Wong Ka Yu
Wong Kit Ying
Wong Man Fung
Wong Pak Kan
Wong Po Yiu
Wong Sze Lam
Wong Tai Ho
Wong Tsz Po
Wong Wu Hung
Wu Yee Wa
Yeung Tsz Ying
Yeung Yi Lam
Yeung Yun Shan
Yim Chi Man
Yip Ka Chun
Yip Ka Yi
Yip Man Ling
Yip Ping
Yiu Ki Fai
Yu Ji Rong
Yu Siu Wai
Yuen Sze Wan
Zhong Lok Yee Beverly
Studies in Foundation Accounting
21
專訪全港中學及大專院校會計個案比賽2006冠軍隊伍
全港中學及大專院校會計個案比賽2006已經圓滿結束。為了讓更多同學有機會參與是項比賽，去年的規則略有更改，由過往的兩組增加至三組：分別為高中組、預科組及大專組。是次比賽反應十分踴躍，共有超過300位中學及大專院校同學參加(高中組：57隊，預科組：78隊及大專組：19隊)。
由2002年舉辦至今，該比賽已踏入第五個年頭，每年均吸引數百名中學及大專院校學生參加。比賽題目取材自上市公司最近期年報資料，而是次公司為「香港經濟日報集團有限公司」。比賽所採用的真實個案研究形式，較傳統問答更具趣味性及實用性，大大提高同學對會計的興趣。
協會代表早前便走訪了各組的冠軍代表，分享得獎同學的喜悅及取勝訣竅。
大專組冠軍：香港城市大學專上學院
準備完善充足 城大脫穎而出
在2006年「全港中學及大專院校會計個案比賽」中，香港城市大學專上學院嬴得大專組冠軍。能夠奪得此項殊榮，實在是可喜可賀，得獎同學皆感到鼓舞。協會期刊副主編王少娟女士特地前往恭賀兩位得獎同學，分享他們獲獎的喜悅，並與兩位暢談一番，了解他們比賽前後的點滴和感受。
豐富體驗 擴闊眼界
談及二人合作參賽的緣由時，得獎同學黃彤埴表示當初看過老師傳來有關比賽的電郵後，覺得這個比賽是吸取豐富體驗、增廣見聞的好機會，便決定參賽。另一位得獎同學陳慧嵐點頭道：「我也認為參賽會是一個寶貴的體驗，自己以往較少參與課外活動，故此亦希望透過參賽擴闊眼界。」在黃彤埴的邀請下，二人便組隊參賽，且一拍即合，在比賽中表現出色。然而，有意參賽的同學眾多，未必每人都可如願以償。校方起初以公開形式招募學生參賽，參加同學合共四隊，但比賽規定每間院校只可派出兩隊參賽，故校方透過抽籤選出參賽隊伍，結果黃陳二人有幸獲抽中。二人得以成功代表學校參賽，多少也要配合一點運氣吧。
準備充足 突圍而出
由於在抽籤後兩星期才公佈比賽的個案研究題目，而在題目公佈後距離真正比賽時間也只得六星期，時間緊絀，故二人在題目公佈前便已開始準備工作。陳慧嵐指出，他們先行參看協會網站的歷屆題目，了解比賽的形式和方向；當獲悉題目為香港經濟日報後，他們便進行資料搜集，閱讀該公司的年報以了解其業務狀況。黃彤埴補充道：「除閱讀年報外，我們做歷屆題目練習時會從經濟日報的角度進行討論，更搜集了經濟日報競爭對手的數據，及外國外匯公司的財務表比率作參考。」準備如此充足，難怪同學在比賽中表現突出。二人亦不諱言上述參考資料幫助很大，令他們在答題時更得心應手。
老師指導 勝券在握
同學努力不懈，準備充足當然能增加勝算，而老師的悉心指導更令同學如虎添翼。黃彤埴謂：「由於比賽涵蓋的內容廣泛，部分涉及的知識是我們在課堂上尚未深入探討的，所以當我們遇到問題時會尋求老師協助，而老師也樂意從旁指導，令我們獲益不少。」陳慧嵐亦深表同意：「有時我們的思考方向可能有所偏差，老師也會加以糾正，並建議我們如何搜集資料，使我們不至於無從入手。」因此，同學獲得獎項，老師實在功不可沒。
取材實例 獲益良多
比賽除了引用本地上市公司的實例作題目，更涵蓋了不同範疇的會計和商業知識，讓同學以實務的方法，全面地運用所學知識。黃彤埴對比賽安排感滿意，指以往校內所做題目均為假設性，是次比賽取材自現實生活中的企業，讓同學得以了解商業市場的實際運作，對學習和將來的事業發展均有莫大裨益。陳慧嵐更謂：「這個比賽開拓了我們的眼界，豐富了我們在各方面的知識，令我們獲益良多，是寶貴的學習經驗。」
左起：陳慧嵐同學、協會期刊副主編王少娟女士及黃彤埴同學。
Studies in Foundation Accounting
22
預科組冠軍：聖公會林護紀念中學
校方鼎力支持 師生共創佳績
聖公會林護紀念中學在會計個案比賽中勇奪預科組冠軍。聖公會林護紀念中學多年來一直踴躍參與比賽，而且屢獲佳績，今年再下一城，一眾師生皆感到非常鼓舞。協會期刊編輯委員陳碧琪女士特地前往訪問副校長麥卓生先生、比賽負責老師黃永添先生，以及得獎同學廖金秋和李文傑，恭賀之餘，亦請他們分享得獎的喜悅。
題材真實 同學獲益良多
該校繼去年取得中學組亞軍後再創佳績，勇奪冠軍，校方甚感欣慰。得獎同學李文傑坦言他們只著重參與，故得知比賽結果時感到既驚又喜，他更謂比賽以真實個案為題材，有助豐富他們的會計知識。坐在旁邊的得獎同學廖金秋聽後點頭說：「能夠取得冠軍，我們真的感到非常高興。正如李同學所說，比賽形式給予我們更多的發揮機會，我們亦從中獲益不少，實在是一個寶貴的經驗。」
個案研習 啟發高階思維
黃老師對比賽所採用的個案研習形式亦評價甚高。他指比賽題目層次很高，其中發揮性題目雖然有一定難度，但一方面可激發學生思考，另一方面又能鍛鍊學生的應變和分析能力：「比賽取材自現實生活，讓同學得以了解商業社
會的實際工作模式，可謂給予同學一次另類體驗。題目要求同學靈活運用所學知識並作適當取捨，而非一味背誦課本知識，有效啟發同學的高階思維。」
集思廣益 訓練思考能力
要在比賽中突圍而出，充足的準備工夫必不可少。備賽期間，老師致力協助同學準備，更在課堂上引用上市公司年報為教材，再配以適當練習，以訓練同學的思考能力。黃老師謂：「由於比賽涵蓋的範圍十分廣泛，要應付比賽題目，練習是非常重要的。我希望同學不論有否參賽也能從中得益，所以每節課堂我也會安排所有同學進行會計個案研習，並透過討論，啟發同學思維，以達至集思廣益的效果。」除此之外，參賽同學也有自行為比賽作準備。廖金秋表示他們透過參閱經濟日報的年報和網頁，了解公司業務和報業概況，更以歷屆題目作練習，以熟習比賽形式。李文傑補充道：「我們還透過閱讀招股書中有關報業界的回顧及評論，了解更多有關經濟日報的背景資料，這些資料對我們幫助很大。」同學自發性如此強，難怪老師也笑言自己有一群高水準的優秀學生，感到十分欣慰。
鼓勵參賽 促進全面發展
問到校方明年會否繼續鼓勵同學參賽時，副校長麥卓生先生說：「校方向來著重同學的全面發展，比賽是學習的好機會，我們當然會全力支持，並繼續鼓勵同學參賽。同學在比賽中獲獎，校方固然感到高興，但最重要的還是同學可從中學習，豐富個人體驗並擴闊眼界。」
左起：協會期刊編輯委員陳碧琪女士、聖公會林護紀念中學副校長麥卓生先生、廖金秋同學、李文傑同
學及比賽負責老師黃永添先生。
Studies in Foundation Accounting
2�
高中組冠軍：喇沙書院
學生合作無間 比賽獨佔鰲頭
在會計個案比賽中，喇沙書院嬴得高中組冠軍。喇沙書院創立於1932年，歷史悠久，人才精英輩出，今次在比賽中脫穎而出，協會期刊編輯委員趙佳駿博士特地前往喇沙書院，恭賀負責老師和得獎同學，並了解同學的比賽致勝之道。
資質優厚 鶴立雞群
喇沙書院向來鼓勵同學參與課外活動，開拓眼界。校方亦積極鼓勵同學參與是次的會計個案比賽，以提升同學對會計的興趣，同學反應亦相當不俗。據悉參賽同學皆由老師篩選，談到參賽同學所需具備的條件時，負責老師羅愛倫說：「首先，同學一定要對會計科感興趣，其次，由於比賽題目要求同學靈活應用會計知識去進行分析，故我們亦著重同學的分析及組織能力。此外，答題時的詮釋亦十分重要，所以同學的語文能力和表達能力也是我們考慮的條件之一。」參賽同學經精挑細選，資質優秀，難怪在比賽中表現出色。
準備充足 勝券在握
同學資質優秀固然能提高勝算，但充足的準備仍是不可缺少的。得獎同學劉皓銘道：「我們透過閱讀香港經濟日報的年報，了解公司的業務，並以之與其他報章的業務作比較，深入探討其優點和缺點。此外，中央圖書館和互聯網也是進行資料搜集的有效途徑。我們在中央圖書館找到了不同上市公司的資料，輔以財經新聞及評論作參考，大大豐富了我們的商業知識。」
分工合作 提高效率
同學準備充足，加上老師的悉心指導和訓練，成效倍增。羅老師表示，由於比賽以個案研習形式進行，加上題目有一定難度，同學不可能一下子完全適應。為協助同學應付比賽，老師集中鍛鍊同學的分析力，並提升同學的商業觸覺，加深他們對現實商業社會運作模式的了解。密集式訓練，配以適當的答題策略，比賽時自然事半功倍。羅老師繼續說：「由於比賽答題時間緊迫，我們採取了取長補短的策略，根據同學的強項分工，讓同學回答自己較熟悉及有信心的題目，這對提升同學的答題效率和比賽表現大有幫助。」
活學活用 舉一反三
談到比賽的致勝心得時，兩位得獎同學異口同聲表示，單靠背誦課本知識是絕對不可行的。范仲恩說：「比賽可說是中學會考所學知識的拓展，要做好比賽題目，最重要是懂得舉一反三，了解會計概念及公司架構，同時也要靈活變通，將所學知識應用到題目上。」劉皓銘補充道：「除了熟讀並消化課本上的知識外，也要多留意財經新聞，參考報章的財經分析，這對提高分析力也有幫助。」
鼓勵參賽 啟發思考
比賽取材自現實生活，其個案研習方式給予同學很大的發揮空間，是學習的良機。兩位同學均表示比賽啟發思考、訓練思維，加深了他們對會計科的認識，令他們明白所學知識並不抽象，更可應用到日常生活中。老師對此亦表示認同：「參加這個比賽不論對老師還是同學來說也是一個體現終生學習的好機會，故校方將繼續鼓勵同學積極參與，以擴闊眼界。」
左起：范仲恩同學、比賽負責老師羅愛倫女士、喇沙書院校長王仁傑先生及劉皓銘同學。
Studies in Foundation Accounting
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到訪香港經濟日報集團
會計個案比賽得獎同學及帶隊老師於五月二十八日到訪香港經濟日報集團。
去年，大會選取了該集團的年報作為比賽題目，是次參觀安排讓同學走出課室，親身了解集團的工作模式和日常運作。同學到達後，受到集團代表的歡迎。他們先觀看短片及集團代表的介紹，以了解集團的歷史、架構、業務及發展等。接著，該報校園版編輯介紹香港經濟日報的製作過程，由撰稿、排版、印刷以至發行等，並派發該報讓同學參閱。之後，同學參觀該報辦公室，包括不同刊物的製作部、圖書館等，進一步了解該報的製作過程。最後拍照留念，見證一次寶貴的學習經驗。 香港經濟日報集團代表介紹該集團的架構及業務。
拍攝大合照。參觀該報辦公室。
ST. PERTH
Activity Highlights
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Examination Technique Seminars
The following Examination Technique Seminars were held recently to help students prepare for the June 2007 examinations:
Professional Bridging Examination Speaker
19 April 2007 Paper I – Financial Reporting Ms Shirley Wong
20 April 2007 Paper II – Management Accounting Mr Fredrick Woodier
26 April 2007 Paper III – Financial Management Mr Michael Wong
23 April 2007 Paper IV – Legal Environment Mr Kenneth Chang
Accounting Technician Examination Speaker
28 April 2007Paper 5 – Hong Kong Taxation Mr Au Yeung Sin Kai
Paper 6 – Hong Kong Business Law Mr Alfred Chan
5 May 2007Paper 7 – Advanced Accounting Mr Chris Lau
Paper 8 – Auditing Mr David Chow
The Examination Technique Seminars were held at the Hong Kong Institute of CPAs’ training rooms. Speakers covered the examination format in detail, providing guidelines on how to answer different types of questions. They further covered strategies when preparing for the exams and some common mistakes which students should avoid. Past questions were covered to illustrate these points. During the Q&A session, students made use of the opportunity to ask the speakers about problems they had encountered during their revision, to which the speakers provided helpful suggestions.
We would like to take this opportunity to thank all the speakers for delivering the seminars and for their continued support of the HKIAAT and our examinations.
Speakers explaining examination techniques to our students.
IVE (CW) Ad
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To: Hong Kong Institute of Accredited Accounting Technicians Limited, T/Dialogue Entry Form for Sudoku – June 2007 Issue
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SudokuThanks to all of you who sent in your entries to our Sudoku puzzle. We appreciate the effort made by all members and students who participated. The first 10 entries with the right answers have won a HK$100 Park’N’Shop cash coupon. Congratulations to the winners!
Answers to the April 2007 issue puzzle
Winners of HK$100 Park’N’Shop cash coupon:3 8 5 6 4 2 9 1 7
2 4 1 9 7 3 8 5 6
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Want to be in our next batch of winners? Have a go at the Sudoku puzzle below and send in your entry as soon as possible to 27/F, Wu Chung House, 213 Queen’s Road East, Wanchai (Fax: 2823 0606). Prizes will be given to the first 10 entries with the correct answer on a first-come-first-served basis. The solution and winners’ list will be published in the next issue.
June 2007 Sudoku:
Sudoku is a placement puzzle, also known as Number Place. To complete the Sudoku, you must enter numerals from 1 to 9 in each cell of a grid. Each row, column and 3 x 3 region (as marked) must contain each numeral once only.
1. CHOW Siu Ching2. LAU Wai Fong3. LEE Choi Lin Cherry4. LEE Chui Har5. CHU Ka Ki6. KWOK Mui7. CHAN Mei To8. SIU Wai Ching9. LAU Lai Nei10. CHUI Wai Ling
Notification has been sent to the winners. Please collect your Park’N’Shop cash coupon at the HKIAAT reception on or before Tuesday, 31 July 2007.
(Source: www.sudoku-puzzles.net)
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The Q&A section here is to answer questions from members and students. You are welcome to write to us at:
Q&A, Greenfield, T/Dialogue
27/F, Wu Chung House,
213 Queen’s Road East,Wanchai, Hong Kong
Fax: 2823-0606
E-mail: [email protected]
Q&A
Q: I have just registered as a student. Does the HKIAAT provide any assistance for me in preparing for examinations?
A: A series of study manuals for the Accounting Technician Examination are available for sale at the HKIAAT reception counter during our office hours. You can obtain a student discount of 20% on these manuals upon presentation of your student card. The study manuals are written to reflect the examination syllabuses and include review questions to assist students in their revision. In addition, the HKIAAT also publishes past paper questions together with suggested answers for each paper after each examination session. These Question & Answer booklets are also available for sale at our reception counter during office hours. Pilot papers and study texts for the new qualification framework will be available for sale in early 2008.
Furthermore, the HKIAAT regularly organises Examination Technique Seminars to help students prepare for the examinations. For details of forthcoming seminars, watch out for announcements on our website www.hkiaat.org and in T/Dialogue.
Q: I have completed all the papers in the Accounting Technician Examination (ATE). Can I take the Professional Bridging Examination (PBE) right away?
A: Until the New Qualification Framework takes effect, you may join the HKIAAT membership upon the completion of the ATE provided that you have fulfilled the following work experience requirements:
Associate membership – one year’s full-time relevant accounting technician work experience or two years of work experience and accounting studies
Fellow membership – five years’ full-time relevant accounting technician work experience
Upon approval of your membership application, you will
be invited to register as a PBE student and enroll in the PBE. To find out more, visit http://www.hkiaat.org/index.php/membership/index/42/.
Q: I have just joined the HKIAAT as an associate member. What Continuing Professional Development (CPD) programmes do I have to participate in?
A: All members are required to undertake a minimum of 20 hours of unstructured or structured CPD each year. Effective CPD is one way in which members can ensure that they are maintaining, enriching and extending their professional and technical expertise. Unstructured CPD is normally achieved though private reading and study; however, members are encouraged to attend structured CPD programmes for their own benefit.
Some examples of structured CPD programmes are courses run by or under the auspices of recognised professional bodies within their CPD programmes. Members of the HKIAAT are eligible to enrol in the CPD programmes for members and CPD activities for students organised by the Hong Kong Institute of CPAs (HKICPA), and they can enjoy the same discount rate that is offered to HKICPA members and students. For more information on these programmes, please refer to the Members’ Corner. For updated links to the upcoming schedules, visit http://www.hkiaat.org/index.php/membership/index/45/.
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A Case Study on Direct Labour Costs for Small and Medium-sized Industrial Enterprises in China(Relevant to ATE Paper 3 – Cost Accounting)
Dr C C Steve Fong
School for Higher and Professional Education, Vocational Training Council
Introduction
Direct labour cost is one of the main cost elements in the total cost of production. Employees are paid either a piecework/daily wage or a monthly salary. Labour cost accounting requires a different approach from other cost elements because it relates to human resources management and government regulations.
Labour Cost Accounting System in Industrial Enterprises
In industrial enterprises, methods of remuneration are broadly grouped into two categories: remuneration on a time basis and remuneration on piece work. The former is used by factories that rely heavily on labour skills. The latter is adopted where product quality is less affected by labour skills.
Remuneration on a Time Basis
The time-rate system is suitable in several situations. The first is that the quality of work is more important than the quantity produced. The second is when the nature of the work is such that it is difficult to measure piece work, such as in the case of indirect workers like supervisors, store men, cleaners, etc. The third is when the work is not repetitive in nature as in the case of jobbing works such as engineering, repair and product design. The fourth is when the volume of production is not within the control of workers. The time basis is also suitable when the amount of output cannot be accurately measured, counted or standardised.
Job Evaluation
Job evaluation enables determination of the most appropriate and effective labour remuneration structure that can be adopted for the enterprise. Based on this structure, an appropriate basic wage rate can be obtained for each job. Job evaluation also helps in understanding and arriving at the relative worth of each job and the justification and quantum variation of the wage structure of different jobs. This analysis leads to the adoption of a differential labour remuneration structure.
Merit Rating
Merit rating is the comparative analysis and evaluation of the merit of the employees within an enterprise. The difference in the performance level, between employees, who are entrusted with similar jobs, are analysed and studied under this method.
Advantages of merit rating are numerous. Employees can be merit-rated for promotion and incremental payments. A proper wage system and incentive scheme can be developed by merit rating. An employee’s suitability for a particular job can be established, thereby resulting in effective use of manpower. The right worker can be found for the right job. Merit rating develops a healthy competition amongst the workers as a result of increased production. It helps each employee to know their own level of performance. Most importantly, merit rating increases output and improves labour-management relations.
Overtime Work
Overtime work is work done outside normal working hours. Payment for the work done consists of two different elements. The first part is the normal payment on the basis of normal hourly rate and the other a premium over the normal hourly rate. The second additional payment is called the overtime premium.
For the purposes of cost accounting, overtime earnings are treated separately from workers’ normal wages. The booking of the overtime amount in the cost accounts depends on the reason for the overtime being required.
Bonus Plans in Group Work
Bonuses are offered to workers as a work incentive. As work is usually done in group in industrial enterprises which adopt a division of labour, group bonus plans are employed to calculate wages and bonuses which are payable to a group of workers instead of to an individual.
The advantages of group bonus plans are the development of team spirit, better quality of work, minimum wastage,
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and, most importantly, increased output. There are some disadvantages. The bonus earned by the group is shared by all, irrespective of the relative efficiency of the group workers: thus group members tend to evade responsibility. Also, it is hard to define clearly the sphere of activity of each individual group member.
Labour Turnover
Labour turnover is usual where there are drawbacks in work conditions. This may be due to insufficient job satisfaction, few opportunities for promotion and training, long working hours, insufficient recreation facilities, and inadequate welfare measures. Some of the unavoidable causes of labour turnover are retirement or death of the worker, personal betterment, illness or accident, and dismissal due to negligence or inefficiency.
Frequent changes in labour normally affect output and increase costs. The effects of high labour turnover, such as increased cost of selection and training of new workers, result in higher costs of production. The overall production goes down due to lower levels of efficiency among the new team of workers and time lost between labour turnover and finding suitable replacements.
Cost accounting for direct labour in practice can be illustrated through the following case study of industrial enterprise.
An Industrial Case in China – Easyweld Welding Equipment Company
Hong Kong-invested industrial enterprises are now mainly located in China, especially the Pearl River Delta, where around 55,200 such enterprises operate. Easyweld Welding Equipment Company is one of the Hong Kong-invested industrial enterprises and the company makes welding equipment in Pun Yu District, Guangzhou.
There are 30 factory workers, one assistant supervisor and one supervisor in the plant. Their daily work is to construct welding equipment on an individual or group basis. The workforce comprises three levels of workers, and the classification is by work experience and skills level. The remuneration structure is mainly based on time worked.
Level 1: Fresh workers: Newly recruited workers are offered a probation period of 3 months. The daily wages are RMB20, and the workers work 8 hours a day and 6 full days a week. As the quality of work is of prime
concern, the factory accounts for its labour cost on a time basis rather than on a piece-work basis.
Level 2: Workers with less than one year’s experience on the post: Once workers have their employment confirmed after the 3-month probation period, they are paid monthly salaries. The factory adopts a merit rating, and the workers’ salaries depend on their skill levels. Workers at a low to medium skill level are paid RMB500 to 600 a month, while workers at a high skill level are paid up to RMB 1,000 a month. In addition, a merit payment of RMB50 a month is offered to certain workers, depending on their attitude.
Level 3: Workers with more than one year’s experience at the post: These workers, who include the assistant supervisor and the supervisor, are paid RMB1,000 to 1,500 a month. In addition, they are offered a group bonus. Since product quality is of prime concern in engineering production, there is no incentive scheme for pushing up production volume. Nevertheless, if there is premium production in any one month, these level 3 workers are granted a group bonus of RMB 3 to 8 per piece of welding equipment manufactured.
In order to maintain work quality, overtime work is not encouraged. Under the Chinese Government Labour Ordinance, the factory pays an overtime work premium that ranges from 25% to 50% basing on the duration of overtime work. By regulations, all factory workers are paid for time-and-a-quarter for overtime carried out between 6pm and 10 pm on weekdays. They are paid time-and-a-half for overtime carried out after 10 pm on weekdays and on Sundays. In addition, the factory flexibly offers extra payment to workers so as to ensure the fulfillment of minimum staff salary enforced by the Labour Ordinance. (A minimum monthly salary of RMB780 is set for the rural Guangzhou.)
For all levels of workers the factory pays for food and accommodation on top of labour wages or salaries. Both the food costs and accommodation costs are around RMB200 a month for each worker. The factory also pays RMB10 a month as social welfare contribution for each worker. This social welfare contribution by employers is mandatory in China. A pension fund contribution is not mandatory in China; it is established on mutually-agreed basis by both employers and employees. The factory also contributes RMB4 a month as medical insurance for each worker. In addition, the employer and workers contribute an equal payment for social insurance; the amount is around RMB80 to 90 a month from each side.
Features
�1In order to encourage staff development, the factory offers a work-related education sponsorship of RMB600 to RMB1,000 to workers. Workers usually take work-related courses like electronic engineering, computer aided design, and/or software skills. In order to maintain the strength of the labour force, workers can have their course fee reimbursed only after completion of the course.
Bonus Scheme for Maintaining Labour
High labour turnover is a significant problem in Guangdong. In recent years, Easyweld has suffered a labour turnover rate of around 20% a year. Usually, this turnover happens when workers do not return to work after the Chinese New Year (CNY) holidays. To rememdy this situation, the factory offers an annual bonus to its level 3 workers. Half of the annual bonus is paid before the CNY holidays, with the rest paid after the holidays. This type of arrangement provides a useful financial incentive to help the enterprise maintain its workforce.
Concluding Remarks
Labour cost accounting involves the study of the behaviour of labour, performance measurement, time and motion studies, control on attendance and government regulations. In modern industrial enterprises the worker’s wage is based upon job evaluation, merit rating, incentive remuneration schemes and government ordinances. These elements are reviewed in the labour cost accounting system of our case study of a Hong Kong-invested industrial enterprise in China.
References:
Fong, C C S and Kumar, N K, Cost Accounting, 2002
edition, HKIAAT
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Salaries Tax Implications for Residents of Mainland China under the Comprehensive Double Taxation Arrangement Dr Dora L Y Lee, KPMG
Introduction
On 21 August 2006, the Hong Kong Special Administrative Region (Hong Kong) and the Mainland of China (mainland China) entered into a comprehensive double taxation arrangement known as the “Arrangement between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income” (the Arrangement). The Arrangement replaced the limited-scope double tax arrangement entered into by Hong Kong and mainland China in 1998 and applies to income derived from Hong Kong from 1 April 2007 onwards.
The Arrangement contains 27 Articles and applies, inter alia, to:(a) persons who are residents of one side (i.e. Hong Kong or
mainland China) or both sides (i.e. Hong Kong and mainland China) (Article 1); and
(b) profits tax, salaries tax and property tax in Hong Kong, whether or not the tax is charged under personal assessment (Article 2.2)).
Of the 27 articles in the Arrangement, the following directly affect the salaries tax liabilities of mainland residents in Hong Kong:(a) Article 14 Income form Employment(b) Article 15 Directors’ Fees(c) Article 16 Artists and Sportspersons(d) Article 17 Pensions(e) Article 18 Government Services(f) Article 19 Students
The following briefly discusses the general principle and interpretation of the Arrangement and its relation with the Inland Revenue Ordinance (IRO), and then focuses on the salaries tax implications of the Arrangement for mainland residents. All references to article numbers and section numbers in this article refer to articles in the Arrangement and the sections in the IRO respectively.
General Principles and Interpretation of the Arrangement
General principles of the ArrangementThe principle of the Arrangement is to tax profits and income on one side only. However, where the same profits and income have to be taxed on both sides, tax paid in one side can be set-off as a tax credit against the tax payable on the other side.
Departmental Interpretation Notes No. 44 (DIPN 44)In December 2006, the Inland Revenue Department (the IRD) issued DIPN 44 (revised in April 2007) “Arrangement between
the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income”, to explain its interpretation and practice as regards the Arrangement.
Relationship between the Arrangement and the Inland Revenue Ordinance According to DIPN 44, the Arrangement is regarded as an integral part of the IRO. In giving effect to the Arrangement, certain areas of Hong Kong tax law may not be followed. In handling problems arising from any inconsistency between the Arrangement and the IRO, priority will generally be accorded to the Arrangement. Where the terms of the Arrangement are less favourable than those under the IRO, Hong Kong adopts the “preferential treatment” approach, i.e. the IRD will follow the IRO.
Meaning of “Mainland Resident”A mainland resident:(a) means any person who, under the laws of mainland China, is
liable to tax therein by reason of his domicile, residence, place of head office, place of effective management or any other criterion of a similar nature; and
(b) excludes any person who is liable to tax in mainland China (mainland tax) in respect only of income from sources in mainland China (Article 4.1(1)).
Where, by reason of the provisions of Article 4.1, an individual is a resident of both sides (i.e., Hong Kong and mainland China), then his status shall be determined as follows: (a) he shall be deemed to be a resident only of the side in
which he has a permanent home available to him; if he has a permanent home available to him in both sides, he shall be deemed to be a resident only of the side with which his personal and economic relations are closer (centre of vital interests);
(b) if the side in which he has his centre of vital interests cannot be determined, or if he does not have a permanent home available to him in either side, he shall be deemed to be a resident only of the side in which he has an habitual abode;
(c) if he has an habitual abode in both sides or in neither of them, the competent authorities (i.e. in the case of mainland China, the State Administration of Taxation (the SAT) or its authorised representatives; and in the case of Hong Kong, the Commissioner of Inland Revenue (the CIR) or his authorised representative or any person or body authorised to perform any functions at present exercisable by the CIR or similar functions) of both sides shall resolve by mutual agreement (Article 4.1).
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Salaries Tax Implications for Mainland Residents
Income from employment (Article 14)General ruleBroadly speaking, salaries, wages and other similar remuneration derived by a mainland resident in respect of an employment shall be taxable only in mainland China unless the employment is exercised in Hong Kong. If the employment is exercised in Hong Kong, such remuneration as is derived from Hong Kong may be chargeable to salaries tax in Hong Kong (Article 14.1).
183-day exemption ruleHowever, remuneration derived by a mainland resident in respect of an employment exercised in Hong Kong will not be chargeable to salaries tax in Hong Kong if the following three conditions are all satisfied: (a) the recipient is present in Hong Kong for a period or periods
not exceeding in aggregate 183 days in any 12-month period commencing or ending in the taxable period concerned;
(b) the remuneration is paid by, or on behalf of, an employer who is not a Hong Kong resident; and
(c) the remuneration is not borne by a permanent establishment which the employer has in Hong Kong (Article 14.2).
If a mainland resident renders employment services in Hong Kong but his remuneration is paid by a Hong Kong employer, he will still be exempt from tax under the IRO if his visit to Hong Kong in a year of assessment concerned does not exceed a total of 60 days according to the preferential treatment principle (DIPN 44).
Any 12-month period commencing or ending in the taxable period concernedIn Hong Kong, the taxable period is the period from 1 April to 31 March of the next year.
“Any 12-month period commencing or ending in the taxable period concerned” denotes two concepts:(a) that the number of days of presence may straddle 2 years, i.e.
the days of presence can be calculated continuously or in the aggregate, irrespective of the year; and
(b) that a floating calculation method may be adopted. The 12-month period can commence or end at any day within the taxable period concerned.
Taking the year of assessment 2008/09 as an example, the time period that should be taken into account, based on the two concepts mentioned above, is between 2 April 2007 and 30 March 2010.
The “days of physical presence” method is adopted in deciding whether a resident is present in Hong Kong for a period or periods exceeding 183 days. Under this method, the day of arrival or departure and each day in the period during which he stays in Hong Kong, however brief and for whatever reasons, will be counted as one day respectively (DIPN 44).
If a mainland resident is not present in Hong Kong for more than 183 days in any 12-month period in the time period identified above, he has met the “present for not exceeding 183 days” exemption condition for the year of assessment 2008/09. However, if the mainland resident is present in Hong Kong for more than 183 days in any 12-month period in the time period identified above, remuneration derived by him in respect of the employment exercised in Hong Kong is chargeable to Hong Kong salaries tax for the year of assessment 2008/09 (DIPN 44).
Special treatment for the year of assessment 2007/08In the year when Article 14 of the Arrangement became effective (the year of assessment 2007/08 for Hong Kong), Hong Kong adopted 1 April 2007 as the commencement date for the purposes of ascertaining the number of days a mainland resident is present in Hong Kong. In other words, in the first year of Article 14’s application, Hong Kong regards any 12-month period to be any 12-month period commencing in the period from 1 April 2007 to 31 March 2008 (DIPN 44).
Mainland residents with a Hong Kong employmentA mainland resident with a Hong Kong employment will normally have his income from employment taxed in full unless he can satisfy the 60-day exemption rule under the IRO (not available to an aircrew, seafarer or Hong Kong government employee) or the 183-day exemption rule under the Arrangement (section 8(1)(a)). If he has paid non-Hong Kong tax similar to salaries tax to a territory in respect the income attributable to services rendered by him in that territory, he may apply for a tax exemption for that part of the income under section 8(1A)(c) of the IRO.
Mainland residents with a non-Hong Kong employmentIf a mainland resident with a non-Hong Kong employment renders services in Hong Kong, and he does not satisfy the 60-day exemption rule under the IRO nor the 183-day exemption rule under the Arrangement, he will be chargeable to salaries tax on a time-in-time-out basis (section 8(1A)). It is necessary to count the number of days he has stayed in Hong Kong in order to calculate his salaries tax liability.
For tax computation purposes, the aggregated period of stay in a year of assessment is the aggregate of the days in each period of stay where the number of days is counted under the “days of physical presence” rule minus one day (DIPN 44).
Mainland China and Hong Kong are geographically so close to each other that a taxpayer may travel between both places on a particular day and provide services in both sides. As such, it is not appropriate to apply the “days of physical presence” rule minus one day. However, serious double taxation could occur if both sides were to apply the “days of physical presence” rule. To address such cases, the SAT and the IRD have reached consensus. If a taxpayer travels between mainland China and Hong Kong on a particular day and provides services in both sides, he will be counted as present in mainland China for half a day and in Hong Kong for half a day. However, if he only provides services either in mainland China or Hong Kong on that day, he will be counted
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as having been present for one day in mainland China or in Hong Kong, as the case may be (DIPN 44).
Employment exercised aboard a ship, an aircraft or a land transport vehicleNotwithstanding Articles 14.1 and 14.2, remuneration derived in respect of an employment exercised aboard a ship, an aircraft or a land transport vehicle operated in shipping, air and land transport by a Hong Kong enterprise shall be taxable only in Hong Kong, and vice versa (Article 14.3).
Directors’ fees (Article 15)Directors’ fees and other similar payments derived by a mainland resident in his capacity as a member of the board of directors of a company which is a Hong Kong resident may be taxed in Hong Kong.
“Directors’ fees and other similar payments”:(a) include benefits in kind (such as share options, the use of a
residence or car, health or life insurance coverage and club memberships), but
(b) do not include wages, salaries and other remunerations paid to a director on account of his other functions with the company (e.g. as an employee or consultant). These wages, salaries and other remuneration will be dealt with in accordance with Article 14 (in the case of income from employment) and Article 7 (in the case of business profits) (DIPN 44).
Artists and sportspersons (Article 16)Notwithstanding the provisions of Article 14, income from employment derived by a mainland resident as an entertainer – such as a theatre, motion picture, radio or television artiste, or a musician, or as a sportsperson – from his personal activities as such exercised in Hong Kong, may be taxed in Hong Kong (Article 16.1).
Where income from employment in respect of personal activities exercised by an entertainer or a sportsperson in his capacity as such accrues not to the entertainer or sportsperson himself but to another person (including a company or any other legal entity), that income may, notwithstanding the provisions of Article 14, be taxed in the side in which the activities of the entertainer or sportsperson are exercised (Article 16.2, DIPN 44).
Pensions (Article 17)Subject to the provisions of Article 18.2 (see below), pensions and other similar remuneration (whether a payment in lump sum or by instalments) paid to a mainland resident in consideration of past employment shall be taxable only in mainland China (Article 17.1).
The term “pensions and other similar remuneration” includes:(a) annuities paid in respect of past employment; (b) lump sum payments in lieu of pensions received at the time
of or after leaving the employment;
(c) sums received by way of commutation of pensions and pensions received by widows and orphans (DIPN 44).
However, Article 17 does not apply to a lump sum payment made upon cessation of an employment or termination of a contract. Such a payment falls within the meaning of income from employment and therefore will be taxed in accordance with the provisions of Article 14 (DIPN 44).
Notwithstanding the provisions of Article 17.1, pensions and other payments (whether a payment in lump sum or by instalments) made under a pension scheme which is: (a) a public scheme which is part of the social security system
implemented by the Government of one side or a local authority thereof;
(b) an arrangement in which individuals may participate to secure retirement benefits and which is recognised for tax purposes in one side,
shall be taxable only in the side in which the scheme is implemented (Article 17.2).
Therefore, pensions and other similar payments made under a “recognised retirement scheme” (meaning a recognised occupa-tional retirement scheme or a mandatory provident fund scheme) in Hong Kong shall be taxable only in Hong Kong (DIPN 44).
Government service (Article 18)Salaries, wages and other similar remuneration, other than a pension, paid by the Government of Hong Kong or a local authority thereof to an individual in respect of services rendered to that Government or authority, in the discharge of government functions, shall be taxable only in Hong Kong. Such remuneration, if paid by the Government of mainland China or a local authority thereof to an individual in respect of services rendered to that Government or authority, in the discharge of government functions, shall be taxable only in mainland China (Article 18.1(1)).
For example, the income of a Hong Kong resident employed by the Hong Kong Government to work in its Beijing office shall be taxable only in Hong Kong. On the other hand, the income of a mainland resident employed by the Central People’s Government to work in its Hong Kong office shall be taxable only in mainland China (DIPN 44).
If the services are rendered in mainland China and the individual is a mainland resident who did not become a Hong Kong resident by reason only of the rendering of such services, such salaries, wages and other similar remuneration shall be taxable only in mainland China (Article 18.1(2)). For example, as above, a mainland resident employed by the Central People’s Government to work in its Hong Kong office shall be taxable in mainland China only (DIPN 44).
Any pension (whether a payment in lump sum or by instalments) paid by, or paid out of funds created or contributed as employer by, the Government of Hong Kong or a local authority thereof to an individual in respect of services rendered to that Government or authority shall be taxable only in Hong Kong. On the other
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hand, such pension paid by, or paid out of funds created or contributed as employer by, the Government of mainland China or a local authority thereof to an individual in respect of services rendered to that Government or authority shall be taxable only in mainland China (Article 18.2(1)). However, if the individual who rendered the services is a mainland resident and the case falls within Article 18.1(2), any corresponding pension (whether a payment in lump sum or by instalments) shall be taxable only in the mainland (Article 18.2(2)).
The provisions of Article 14 (Income from Employment) for sala-ries and wages, Article 15 (Directors’ Fees) for directors’ fees and other similar payments, Article 16 (Artistes and Sportspersons) for income derived by artistes and sportspersons and Article 17 (Pensions) for pensions and other similar remuneration shall apply to remunerations and pensions received in respect of services rendered in connection with a business carried on by the Govern-ment of one side or a local authority thereof (Article 18.3).
Students (Article 19)Payments which a student who is or was immediately before
visiting Hong Kong a mainland resident and who is present in Hong Kong solely for the purpose of his education receives for the purpose of his maintenance and education shall not be taxed in Hong Kong, provided that such payments arise from sources outside Hong Kong (Article 19). Qualifying payments include tuition fees, student grants and scholarships from sources outside Hong Kong (DIPN 44).
Conclusion
The above paragraphs explain the salaries tax treatment for income from employment, directors’ fees, pensions, etc., derived by a mainland resident under the Arrangement and DIPN 44. Generally speaking, a mainland resident with either a Hong Kong or non-Hong Kong employment will be chargeable to salaries tax in a similar manner to other individuals except that they may enjoy the 183-day exemption rule under the Arrangement. However, there are some specific rules allocating the rights to tax between Hong Kong and mainland China. Students handling a salaries tax question concerning a mainland resident should apply the appropriate salaries tax treatment based on the facts given in order to arrive at the right answer.
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