【正文】 mination entries F3 Elimination data file F1 Internal transaction data file P6 Enter elimination entries Aggregated Ledger reports 30 REPORTING SYSTEM P11 IAS reporting process IAS reporting involves three steps: 1. IAS adjustment entries preparation steps P9, P10, P12. This has been discussed earlier in this document. The adjustment entries contain these fields: account code, period, adjustment description, credit amount and debit amount. 2. Apply IAS adjustments to the Consolidated Ledger report and create temporary IAS adjusted ledger report. This is done by the system through the following calculations: Adjusted balance of one report item ( or account) = Consolidated balance of the report item( or account) +() Total credit amount of all adjustment entries (+) Total debit amount of all adjustment entries。 Deductions。 ? Accumulated depreciation: Beginning balance, charge for the year, disposals, ending balance ? Movement of allowance of investment value diminution Beginning balance。 Deductions。 Expenses not deductible for tax purposes ? Movement of allowance for doubtful accounts Balance at beginning of period, Provision, Deductions, Balance at end of period ? Movements in allowance for diminution in value of inventories Balance at beginning of period。PetroChina Requirements and design of FMIS modifications FMIS enhancement project December 1999 1 Contents 1. Business requirements 3 2. Gap analysis 10 3. Overall approach and design principles 13 4. Business process overview 15 5. Overview of system changes 18 6. New data files and associated processes 24 7. System processes for consolidation and reporting29 Appendix A Report formats 32 2 System Design for FMIS Modification 2 Business requirements Chapter 1 3 To be able to do an IPO, PetroChina need to be able to produce certain key financial reports To produce these reports, some changes to FMIS needs to be implemented. Business requirement overview The FMIS system need to be able to produce the following reports: ? Annual consolidation reports as required by China Finance Ministry based on the PRC GAAP for jointstock pany. ? Quarterly consolidation of reports of the overall ListCo based on the IAS is required for publicly listed panies. ? Disclosure items are also required by IAS and PRC GAAP for jointstock pany. ? Some other information is required to support annual auditing. All the above reports (except the audit information) will need to be produced along the new PetroChina anization structure as described in the following page. The above reporting requirements are detailed in the next pages. 4 PetroChina Level 1 PetroChina Level 2 Specialized Co/Business Group Level 3 Segment Level 4 Type EP ... ... ... Level 5 Business Units ... ... Gas Pipeline Downstream OilGas EP Natural gas (inc. gas pipeline) Refining Marketing Petrochemicals marketing Others Refining PetroChina reporting structure Marketing RD China oil HQ Beijing EP HuaBei GP HuaBei Refinery HuaBei North China China OG research institute Level 6 Operations Units Level 7 Suboperations Units Oil field 1 Oil field 2 Oil field 3 District 1 District 2 District 3 5 PRC GAAP consolidation report requires the following data: Business requirements for PRC consolidation ? Individual PRC GAAP reports of all entity involved in consolidation. ? Balance sheet ( PRC GAAP) ? Ine statement ? Cash flow statement ? Internal transactions reports ? Internal transaction list ?Internal product sales or purchase report ?Internal rendering of service report or internal service purchase report ?Internal longterm equity investment report, capital structure report ?Internal payable or receivables ? Required information for internal transactions ? Counterpart, transaction type, period, beginning balance, credit amount, debit amount, ending balance 6 There are two types of changes that need to be made to ply with IAS Business requirements for IAS consolidation ? PRC consolidated financial statements with specific details ? Individual PRC reports listed earlier ? Ledger report ? Transactions with different accounting treatment in IAS and PRC GAAP ? Development costs EP segment specific ?Cost of successful well ( succeeded in the period ) ? Assets and depreciation ( straight line method vs UOP) and related tax credit ?Assets class, accumulated depreciation amount based on reevaluated carrying amount by straight line method。 depreciation amount based on unreevaluated amount by unit of production method or straight line method ( depend on assets class ) ? Deferred business initial cost ( preoperation expenditures ) ?Beginning balance, ending balance ? Monthly revaluation of noncurrent moary assets liabilities ( foreign currency item) ? Historical value ( calculated by exchange rate of occurring date ), reevaluated value of longterm loan( foreign currency), longterm deposit( foreign currency), other longterm moary assets or liabilities. 7 IAS and PRC GAAP requires the following items for disclosure purpose: Business requirements for disclosure purposes C u r r e n cy L o a n s fo r o il f ields d e velo p m e n t r e finin g p la n ts co n structio nW o r king ca p it a l loa n Ave r a g er a teR M BU S$YEN……? Aging report of accounts receivable ( PRC GAAP ) ? Longterm equity investment ( PRC GAAP ) Investee, stock type, share number of stock, share percentage, amount, remarks ? Longterm bond investment ( PRC GAAP ) Bond type, par value, rate, purchased amount, due date, interest of this year, accumulated interest, remarks ? Other non