Chinese Institute of Certified Public Accountants

In the People’s Republic of China, the quality assurance review system operates through a shared framework involving the Ministry of Finance (MoF), the China Securities Regulatory Commission (CSRC), and the Chinese Institute of Certified Public Accountants (CICPA). CICPA continues to work closely with the Ministry of Finance and the China Securities Regulatory Commission to avoid duplication of work through established coordination mechanisms, including information sharing, joint training, joint investigation and verification procedures, and cooperation in the development and revision of related laws and regulations.

Within the scope of its mandate, CICPA oversees the national quality assurance framework and provides unified guidance to local CPA institutes, which conduct reviews of firms auditing non-listed entities in their respective jurisdictions. CICPA centrally determines the annual focus of inspections, sets inspection requirements, trains inspectors, and reviews the inspection results submitted by local CPA institutes. This supports a consistent application of the quality assurance framework throughout the jurisdiction.

CICPA has also continued to strengthen its quality assurance framework through reforms and ongoing enhancements, including improvements to the assessment of firms’ internal quality management systems, the development of qualified inspection teams, and increased use of information technology in inspections and reporting. More recently, China has transitioned from the former quality control framework to standards aligned with International Standard on Quality Management 1 (ISQM 1) and International Standard on Quality Management 2 (ISQM 2), further strengthening alignment with international best practices.

In addition, CICPA undertakes significant member support and implementation activities, including publication of inspection findings, preparation of sample audit cases for learning purposes, integration of quality management topics into continuing professional development programming, and annual training for chief executive officers and engagement partners responsible for quality management in firms auditing listed entities.

Based on these well-established ongoing processes, and CICPA’s continued review and enhancement of the quality assurance framework, the Institute is assessed as Sustain for SMO 1.

Current Status: Sustain

Under the Law of the People’s Republic of China on Certified Public Accountants of 1993, the initial professional development requirements for all Certified Public Accountants (CPAs) in the jurisdiction are established in law. The Chinese Institute of Certified Public Accountants (CICPA) administers the National Unified CPA Examination under the oversight of the Ministry of Finance (MoF) and is also responsible for establishing and monitoring continuing professional development requirements for its members.

CICPA indicates that both its initial professional development and continuing professional development requirements are aligned with the International Education Standards (IES) and that it maintains ongoing processes to monitor new and revised standards and incorporate necessary changes into its examination and continuing education frameworks.

To support implementation, CICPA has issued continuing professional development regulations and related guidance aimed at strengthening the competencies and professional skills of its members. Over time, the Institute has undertaken significant reforms and enhancement initiatives, including the implementation of its Five-Year Plan on Talent Cultivation of the Chinese Accountancy Profession (2011–2015), the transition of the CPA examination to a computer-based format in 2012, the incorporation of professional judgment and ethics into training requirements, and the development of specialized curricula and training programs tailored to members’ qualifications and roles.

CICPA has also continued these efforts through subsequent development plans focused on strengthening the accountancy profession, modernizing the examination framework, and enhancing continuing professional development requirements to support sustainable professional growth.

Based on these well-established ongoing processes and CICPA’s demonstrated commitment to continuously reviewing and improving its education and development framework, the Institute is assessed as Sustain for SMO 2.

Current Status: Sustain

The Chinese Institute of Certified Public Accountants (CICPA) is legally responsible for drafting auditing standards, which are subject to approval by the Ministry of Finance (MoF). Since 2006, CICPA has been working to converge the Chinese Standards on Auditing with the International Standards on Auditing (ISA). The standards have since been updated to reflect the latest ISA issued by the International Auditing and Assurance Standards Board (IAASB), including recent revisions to the quality management framework and related auditing standards.

CICPA continues to support implementation through the preparation and publication of technical guidance and practice materials, including guidance on audit working papers for financial statement audits and audits of small and medium-sized entities. The Institute also uses information obtained through the quality assurance review process to identify areas requiring further support and to strengthen members’ compliance with the applicable auditing standards.

In addition, CICPA maintains ongoing processes to monitor developments issued by the IAASB and to update the national standards framework accordingly, while continuing to provide implementation support and continuing professional development activities for its members.

Based on these well-established ongoing processes and CICPA’s continued commitment to maintaining alignment with the latest ISA, the Institute is assessed as Sustain for SMO 3.

Current Status: Sustain

The Chinese Institute of Certified Public Accountants (CICPA) is responsible for establishing ethical requirements for its members and has established the China Ethics Standards Board for CPAs to support this function. Through this framework, CICPA has updated its Code of Ethics to reflect the 2024 International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA), while retaining certain provisions that are more stringent in specific areas to align with national legal and regulatory requirements.

CICPA continues to support implementation of ethical requirements through a range of activities, including the translation of international ethical standards, the preparation of guidance materials and frequently asked questions, and the dissemination of implementation support to members. Compliance with ethical requirements is also assessed as part of the quality assurance review process for practitioner members, which further supports monitoring and enforcement.

In addition, CICPA participates in the international ethics standard-setting process by collecting member feedback and submitting comments on exposure drafts issued by the International Ethics Standards Board for Accountants.

While CICPA demonstrates strong ongoing processes to support the implementation and maintenance of ethical requirements, the applicable Code is currently aligned with the 2024 IESBA Code, and therefore does not yet fully reflect the 2025 version of the International Code of Ethics for Professional Accountants (including International Independence Standards) in effect as of the time of the assessment.

Accordingly, the Institute is assessed as Review & Improve for SMO 4 and is encouraged to continue updating its ethical framework to align with the latest IESBA Code and to further strengthen ethics-related training within its initial and continuing professional development programs.

Current Status: Review & Improve

The Ministry of Finance (MoF) is responsible for establishing public sector accounting standards in the People’s Republic of China and for leading the ongoing government accounting reform process. Public sector accounting is currently based on accrual-basis national government accounting standards issued by the Ministry of Finance.

The Chinese Institute of Certified Public Accountants (CICPA) does not have direct responsibility for adopting public sector accounting standards. However, CICPA has indicated that it supports the Ministry of Finance’s work program in this area through research and technical input and seeks opportunities to assist with the convergence and reform process. This includes support for the broader development and implementation of the national public sector accounting framework.

While CICPA’s role remains indirect, its participation in supporting the Ministry of Finance’s work program and promoting developments in public sector accounting demonstrates ongoing engagement in this area. Accordingly, CICPA is assessed as Review & Improve for SMO 5.

CICPA is encouraged to continue strengthening its support for members working in the public sector, including through continuing professional development and technical guidance related to public sector accounting standards.

Current Status: Review & Improve

Under the Law of the People’s Republic of China on Certified Public Accountants of 1993 (CPA Law), local CPA institutes may revoke CPA certificates in cases of serious professional misconduct. The law also authorizes the Ministry of Finance (MoF) to issue disciplinary warnings, fines, suspensions, and other sanctions in cases of non-compliance with applicable laws and regulations.

Under the same law, the Chinese Institute of Certified Public Accountants (CICPA) is responsible for establishing professional rules and standards for certified public accountants and may issue disciplinary measures through its charter and implementing regulations. Pursuant to this authority, CICPA has established a formal investigative and disciplinary framework for its members.

CICPA has continued to strengthen and review this framework over time. In 2011, the Institute updated its disciplinary procedures using the Statement of Membership Obligations (SMO) 6 requirements as guidance. Under the revised framework, a Disciplinary Committee is responsible for issuing sanctions and disciplinary actions, with an Appeals Committee in place to review appeals. CICPA subsequently evaluated its system against SMO 6 requirements and has indicated that the framework continues to be aligned with international best practices.

Local CPA institutes either apply CICPA’s system directly or operate systems based on the national framework and are required to report their cases and outcomes to CICPA annually. CICPA and local CPA institutes continue to take disciplinary action where necessary, demonstrating that the system remains active and operational in practice.

In addition, the China Securities Regulatory Commission (CSRC) and the Ministry of Finance coordinate closely with CICPA in this area, including participation in disciplinary and appeals mechanisms and the operation of joint investigation and verification procedures for auditors and firms undertaking listed entity audits.

Based on these well-established ongoing processes and CICPA’s continued review and enhancement of the investigative and disciplinary framework, the Institute is assessed as Sustain for SMO 6.

Current Status: Sustain

The Ministry of Finance (MoF) is responsible for establishing corporate accounting standards in the People’s Republic of China and has historically worked to converge the Accounting Standards for Business Enterprises (ASBEs) with the International Financial Reporting Standards (IFRS). CICPA has indicated that it participates in the Ministry of Finance’s consultative standard-setting process by providing technical feedback and comments when standards are revised.

Within the scope of its role, the Chinese Institute of Certified Public Accountants (CICPA) primarily supports the implementation of applicable accounting standards through training programs, awareness-raising activities, and the dissemination of IFRS-related pronouncements and updates to its members through its website and professional development programming.

While IFRS Accounting Standards are not directly adopted for statutory application by domestic publicly accountable entities in the jurisdiction, CICPA continues to support the broader convergence process and the implementation of the national standards framework through ongoing educational and technical support activities. Accordingly, CICPA is assessed as Review & Improve for SMO 7.

CICPA is encouraged to continue strengthening its support for members through targeted training and implementation guidance and to further support the convergence process so that the Accounting Standards for Business Enterprises continue to reflect the currently effective IFRS and material differences are progressively reduced.

Current Status: Review & Improve