The Research On The Accounting Issues Of Enterprise Annuity Under The New Accounting Standards

Since the seventies of the twentieth century, the aging of the population makes the countries all over the world fall in to the old-age financial crisis, the issue of aging population becomes serious, the debt burden of the basic old-age insurance is increasingly heavy, all of which make the governments take measures to reform the pension system, and establish a supplementary pension insurance. The establishment of China's enterprise annuity system is in such a large background. Enterprise annuity is different from the compulsory basic old-age insurance, or the commercial insurance. Enterprises annuity fund take the function of fully accumulation, individual accounts management, and market-oriented operation mode. It takes the principle of voluntary, and gives a certain degree of policies of preferential tax. The enterprise annuity is composed of three parts which is the payment of the enterprises, payment of the individuals and the operation earning of itself.Enterprise annuity accounting is an accounting that reflects and supervises the collection, operation, preservation and payment of the pension comprehensively, systematically and continuously under the scheme of the enterprise annuity. As the open model of the cycle of the enterprise annuity, the accounting of the enterprise annuity is different from the financial accounting system of the general business, it is composed of two phases, the enterprise annuity payment period in which the accounting entity is enterprise, and the investment and operation period which main entity is enterprise annuity funds: in the payment period, enterprise annuity is the obligation of pension payment that the enterprise should pay to the employee, and the industry needs to make this future obligation reflect as the cost of the enterprise reasonably. In the period of operation and investment, the annuity fund has become an accumulated storage fund under the annuity plan to repay the debt, the fund has gotten rid of the sponsors of the enterprise annuity plan, only invests and operates in accordance with the investment program, forms its own asset, liabilities, income, expenditures, and the balance, form a separate accounting entity. The different characters of the enterprise annuity of the two periods lead to the differences of the accounting system of the two periods.There are many objectives for the enterprise accounting, including to provide useful information for the enterprise annuity stakeholders, and to help them to operate and make decision; to assess the enterprise annuity operators'entrusted responsibility of the implementation of the enterprise annuity; to strengthen the operation and management of the enterprise annuity. However, in general, the most fundamental goal of the enterprise annuity accounting is to enhance the benefit of the enterprise annuity during the operation, to achieve the preservation and the increment of the enterprise annuity. In the assumptions of the enterprise annuity accounting, besides the difference of its accounting entity's with the general accounting entities, there are two different accounting entities in the two periods, the rest assumptions including the continuing operations, accounting phases and monetary measures are consistent with the general financial accounting. At the same time, the enterprise annuity in our country is also in accordance with the international practice. It takes the accounting principle such as accrual, substance over form, full disclosure and so on to make the accounting recognition, measurement and presentation.As mentioned before, in the construction of the accounting system of the enterprise annuity accounting, it needs to account according to the paying period and the operating period these two periods respectively. In the paying period, the accounting entity is the enterprise itself, the accounting in this period is the same with the traditional accounting, is seen as the delayed wages for the enterprise to pay for the employees. In the accounting dealings, it needs to confirm the cost in accordance with the amount, and draw with their own assets, the involved accounting elements are the assets, liabilities and the costs. The difficulty of this period is the measurement of the cost of the enterprise annuity under the type of defined benefit. Different with the type of defined contribution which measures the expense according to the current service cost. This type need to promise make the payment that they need to pay for the employees in the future convert into current cost. During the measurement, besides consider the current costs, there are still other factors such as prior service cost, interest cost, the reward of the fund, actuarial gains and losses, the changes of risk in the future and so on, the process of calculation is complex, and needs actuary to calculate, now our country does not have this conditions yet. In the accumulation and the paying period, the accounting involves five accounting factors, including the assets,liabilities,revenue,costs and the balance. Among them, the assets include the money funds, settlement accounts receivable of securities, dividend receivable, interest receivable, buying securities and return sale, other receivables, bond investment, fund investment, stock investment and other investment. The liabilities include the payable treatments to beneficiaries, management fees payable to the trustee, management fees payable to the investment manager, tax payable, prices of sale of repurchased bonds, interest payable, commissions payable and other payables. In the process of operating, the enterprise annuity forms the various incomes including the stock price income, the bond spread income, the fund spread income, the bond interest income, dividend funds income, deposit interest income, the income of the buying securities and return sale, changes in fair value gains and losses and other incomes. The costs include the trustee fees, custodian fees, investment management fees and other costs; the net asset only refers to the account of enterprise annuity fund. It includes the balance of the assets minus liabilities, and also include the fees charged and payable and into or the out of the account.In the process of the development of enterprise annuity system and the enterprise annuity accounting, there are some problems accompanied that constrain the development of the enterprise annuity. The first is the size of the development of the enterprise annuity system. China's enterprise annuity system has the problem of small scale, low replacement rate, absence of tax incentives, and the lag of the relative laws and regulations, all of which restrict the footsteps of the development of the enterprise annuity. And second, China's enterprise annuity under the new accounting standard doesn't make clear criterion about the accounting dealing in the paying period of the enterprise annuity, which make the accounting dealing non-uniform, non-standard. And besides, the regulation about the information disclosure system of the enterprise annuity is imperfect, which makes the beneficiaries of the enterprise annuity in a weak position. And at the same time, the imperfection of the capital market and the accounting supervision system both restrict the healthy development of the enterprise annuity. To solve the problems above, what need to do is to let the government guide, enforce the enterprise annuity plan vigorously, improve the legislative system of enterprise annuity, make the preferential tax policies, establish the enterprise annuity accounting standards whose entity is enterprise itself as soon as possible, strengthen the information disclosure system of the enterprise annuity, improve the capital markets in our country, strengthen the investment and the accounting supervision of the enterprise annuity.The implement of the enterprise annuity system of Jilin Electric Power Limited Company has its significance and effectiveness, this paper analyses and evaluates the enterprise annuity system of this company, summers up the effects of the enterprise annuity system and also gives a sound proposal, to expect the better development of the annuity system in our country. Finally, this paper concerned on the trends of the development of the enterprise annuity, and give proposals for the better development of the enterprise annuity.