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Source link: http://archive.mises.org/5153/chinese-innovation/

Chinese Innovation

June 7, 2006 by

It’s a commonplace that Americans and Westerners are the technical and business innovators, and that Chinese are good at imitation. But sometimes it’s the reverse. I recently learned of a Chinese tax policy that I fear the IRS may want to emulate someday (if they are not already–I’m not a tax expert). It’s come to my attention that when a foreign company owns a Chinese company qualified to do business in China, the Chinese Tax Authority (the analog of the IRS) requires the Chinese company to use Chinese-government approved accounting software which is directly linked to the tax agency’s computers–every day, in real time, the company’s financial and other data that is entered is directly accessible to and ported to the tax agency’s system. Res ipsa loquitur.

{ 4 comments }

M E Hoffer June 7, 2006 at 10:11 am

This is coming to the U.S. through SEC program, now voluntary, requiring the filing of “public reports”( 10-K, 10-Q, et al, ad infinitum ) using XBRL.

Cox, his ownself, is on record saying that the program has multi-various applications for multi-various, including the IRS, agencies.

M E Hoffer June 7, 2006 at 10:42 am

http://www.cfodirect.pwc.com/CFODirectWeb/Controller.jpf?ruleCode=MSRA-6LBQAZ

as one can tell, from the link, this, XBRL, is a real “chop-moistener” for “Consultants” and “outside” Auditors/Attorneys/Accountants and their attendant IT support eco-system.

Black Bloke June 7, 2006 at 7:33 pm

I thought XBRL was just a XML file format for the SEC filings? I was watching Cox on C-SPAN the other day, and he gave the analogy of the RSS feed and it’s ability to automatically adapt to changes in inputs. I thought it sounded pretty cool if that could be applied to financial information. Now I’ve got to worry about it?

Horatio June 8, 2006 at 7:25 am

I really hope that doesn’t come here. I enjoy paying cash at Chinese businesses because I know they report as little of it as possible. The same goes for tips.

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