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Accounting Services in Hong Kong2023-08-11T10:52:32+00:00

Accounting services play a pivotal role in the process of setting up a company in Hong Kong. Beyond ensuring compliance with tax and reporting requirements, these services become a crucial instrument in propelling your business towards achieving its envisioned and measurable objectives.

The Need for Accounting

Section 51C of the Inland Revenue Ordinance mandates that any individual conducting a trade, profession, or business in Hong Kong must maintain adequate records in either English or Chinese. These records should accurately document their income and expenditure, making it easy to determine the assessable profits, and kept for a minimum of 7 years.

Failure to comply with these obligations, without a reasonable excuse, may result in a maximum fine of HK$100,000. The records required by the Ordinance encompass various documents, such as books of accounts that record receipts and payments or income and expenditure, vouchers, bank statements, invoices, receipts, and records of assets and liabilities related to the trade, profession, or business.

Filing Deadlines in Hong Kong

As per Section 379(1) of the Companies Ordinance (CO), all directors of a Hong Kong company are obligated to prepare financial statements for each financial year. Additionally, the CO mandates that these financial statements must adhere to the accounting standards specified by the Hong Kong Institute of Certified Public Accountants (HKICPA).

A company’s initial financial year commences on its incorporation date and concludes on a date chosen by the directors within 18 months from incorporation. Subsequent financial years will end on the anniversary of this specified date. To organise consolidation processes better and present a more coherent picture to stakeholders, subsidiaries often adopt the same financial year-end as their holding companies, though this is not mandatory.

Financial year-end options include:

Regarding taxes, Hong Kong-incorporated companies receive their first profit tax return (PTR) from the Inland Revenue Department 18 months after incorporation. Deadlines for filing the annual profit tax return vary based on the company’s year-end date. For instance, companies with a financial year-end on 31 December must submit their PTR by mid-August each year, while those selecting 31 March as their year-end date must file by mid-November annually. Other financial year-end dates have a filing deadline at the end of April each year.

Accounting Services

Paul Hype Page & Co stands out as a leading provider of accounting services. Explore our range of common accounting services in Hong Kong to align your business with its financial objectives and fulfill tax and reporting obligations effectively.

  • Cash Flow and Working Capital Analysis
    We assist small and medium enterprises (SMEs) in identifying, assessing, and addressing gaps in managing their working capital and cash flow effectively.
  • Accounts Consolidation Services
    Our expert team provides consolidated financial statements to allow a company’s shareholders or management to gain insights into its current financial status.
  • Management Reports and Accounts
    We offer accurate and timely financial and statistical information to aid managers in making informed day-to-day and short-term decisions for the organization’s internal audiences.
  • Financial Planning and Budgeting
    Our services help SMEs implement robust planning and budgeting practices to effectively manage their financial resources.
Financial Planning and Budgeting

Accounting Standards in Hong Kong


The Hong Kong Institute of Certified Public Accountants (HKICPA) oversees the accounting industry in Hong Kong, ensuring compliance with accounting standards. Companies incorporated in Hong Kong are required to maintain proper accounting books and fulfill statutory audit requirements annually as per the Hong Kong Companies Ordinance.

In 2010, the HKICPA introduced the Hong Kong Financial Reporting Standard for Private Entities (HKFRS for Private Entities) as an option for private entities to ease reporting requirements under full HKFRS. The HKFRS for Private Entities sets qualifying criteria outlined in Section 1 for applying this standard.

Accounting standards in Hong Kong follow the accrual basis, recognizing transactions and events within the same financial statement periods. Financial statements prepared on this basis provide insights into past transactions, future cash obligations, and potential cash accruals.

HKICPA’s responsibilities include applying HKFRS to general-purpose financial statements of profit-oriented entities, and serving various users’ information needs, such as shareholders, creditors, employees, and the public. HKFRS includes Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards (HKAS), and Interpretations delivered by HKICPA. The required financial documents comprise a statement of cash flow, accounting policies, explanatory notes, a statement of financial position, a statement of comprehensive income, and a statement showing changes in equity.


Hong Kong Generally Accepted Accounting Principles (GAAP) comprise of a set of accounting principles, standards, and procedures that companies in Hong Kong must adhere to while preparing their general-purpose financial statements. Compliance with HK GAAP is particularly crucial for companies distributing their financial statements outside the organization.

Publicly traded corporations must ensure that their financial statements also conform to the rules set forth by the Securities and Exchange Commission. GAAP covers diverse aspects, including revenue recognition, balance sheet presentation, item classification, and measurement of outstanding shares.

Investors should exercise caution if a financial statement deviates from GAAP standards. Some companies may use both GAAP and non-GAAP measures in their financial reporting. However, non-GAAP measures must be explicitly identified in financial statements and other public disclosures, such as press releases, in accordance with GAAP regulations. This transparency ensures informed decision-making by investors.

Your Questions, Answered

Handling accounts in a company first the first time may be daunting. Here is a compilation of the top questions we get asked about accounting in Hong Kong to clear your doubts!

What is the difference between GAAP and IFRS?2023-08-08T09:35:48+00:00

The differences between GAAP and IFRS can be illustrated in the table below:

System Rules-based Principles-based
Level of Detail More detailed Less detailed
Interpretations Specific More room for interpretation
Financial Statements May necessitate long disclosures May require detailed financial notes
Inventory Treatment Allows last-in, first-out (LIFO) Bans the use of last-in, first-out (LIFO) for inventory
Weighted Average-Cost Method Allows FIFO method Allows FIFO method
Inventory Reversals Doesn’t allow inventory reversals Allows inventory reversals (in certain situations)
How can I calculate tax avoidance?2021-06-10T09:08:18+00:00

Tax avoidance is computed by dividing the total expenses by the accounting earnings before tax. Tax avoidance is thus a reflection of the aggregate proportion of accounting income payable relative to the accounting earnings.

Do I need to file my taxes for an online business?2021-06-10T09:07:06+00:00

The answer is yes. All businesses in Hong Kong should strive to file their taxes and in time to avoid penalties or being jailed for tax evasion. PHP will still come to your help if you are not familiar with the Hong Kong tax laws and requirements. Please consult with us further on the accounting information as it varies from one business to the next. 

How are Dormant Companies Taxed?2021-06-10T09:07:12+00:00

Dormant companies are not taxed because during the period for which they are dormant, they do not carry out any accounting transactions that can be taxed. A dormant company may only be taxed after it has become active.

Articles about Accounting

Need tips about accounting Hong Kong? Read our insightful guides that we’ve crafted based on our years of experience.

Why Outsource Your Accounting Function

Your time is precious – spare your time and leave the hard work to us.

In the fast-paced business world of today, opting to outsource your company’s accounting function to a professional accounting firm in Hong Kong presents numerous benefits. Here are compelling reasons to consider this approach:

Reinvestment of Cost Savings

Efficient Allocation of Time Resources

Elimination of Deadline Worries

Superior Quality of Work

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