1. Transfer investment according to law, including but not limited to bidding, auction, invitation to bid, public inquiry, etc.
2. Incorporate the converted actual property into the liquidation property of the company for future debt settlement;
3. If a shareholder borrows money from the company, it shall be accounted for as other receivables;
4. Shareholders need to sign a corresponding loan contract with the company and repay the loan within the time limit stipulated in the contract. If it is overdue, it will pay overdue interest according to the agreement or state regulations, bear the liability for breach of contract, and may even face civil litigation.
Accounting treatment of the company's foreign investment;
1. confirmation of investment funds: when paying foreign investment funds, the amount of investment funds should be confirmed and recorded in the accounting books accordingly;
2. Debit bookkeeping: usually, the debit is recorded as "long-term equity investment" or "investment funds", and the lender is recorded as "bank deposit" and "other payables" according to the source of funds;
3. Investment cost confirmation: including actual payment and related transaction costs, such as agency fees and attorney fees;
4. Follow-up measurement of investment: according to the type and holding purpose of the investment object, the cost method, equity method or fair value method may be adopted for the follow-up investment;
5. Confirmation of investment income: For the investment that can be controlled or has a significant impact on the investment enterprise, the investment income shall be confirmed according to the profit distribution of the invested unit;
6. Investment impairment test: conduct impairment test on long-term equity investment on a regular basis, and make provision for impairment if there are signs of impairment;
7. Disposal of investment: When selling or transferring investment, the investment gains and losses shall be calculated and handled in the accounting books.
To sum up, the accounting methods of the company's foreign investment funds include transferring investment according to law, merging actual property into liquidation property to pay off debts, accounting shareholders' loans as other receivables, and requesting to sign a loan contract and repay on time, otherwise it will bear the liability for breach of contract and even face civil litigation.
Legal basis:
Company Law of the People's Republic of China
Article 15 1
A company can invest overseas by purchasing the equity or assets of other companies or by merging with other companies. The company's foreign investment shall be conducted in accordance with the provisions of laws, administrative regulations and the articles of association.
Validation of laws and regulations: June 2024 17