Cognizance Of Enterprises Related Transaction And The Related Accounting Treatment

In modern market, plenty of related trade happens between connected enterprises, this transaction has two sides, it is reasonable but with lots of trades without the permission of the public that always hurt the peoples'lawful rights the order of market and the rights of creditors. In recent years, with the promotions of new regulations, the formations of related trades appeared some multiple trends. Especially, Non-related of the related party transactions became the main methods of pursuing and steering profits of the connected enterprises.By comparison of the definition of connected transaction, regulations of China are now becoming compatible with internationally accepted practices. The international connected transactions emphasize discovering and publishing. In China, only discovering and publishing are not enough to regulate the actions. Non-connected related trades are increasing now, but identification of the current model do not cognize all of the related party transactions. So, some researches on cognizance are necessary. By comparison between the regulations of connected transaction in China and internationally, the thesis proposes the cognizing mode based on transaction. The cognizing mode that combined the cognizing mode based on relationship is a new mode of cognizing in China with the advantage of essence more than the form, after the cognizance, the accounting treatment is more practice than any other solutions that was used for many years and tend to be lag behind the time. The thesis also propose a new idea of accounting treatment towards the multiple and complex connected transaction on some respects of certain subjects, any other respects will be discuss in other papers.