Bookkeeping Requirements

According to Part 9 of the Hong Kong Companies Ordinance, companies incorporated in Hong Kong must maintain proper books of accounts and must also satisfy statutory audit requirements on an annual basis.

To be more detailed, the bookkeeping requirements in Hong Kong are as follows:

  • A company must keep accounting records that comply with:
    • Accounting records that are sufficient to show and explain the company’s transactions; to disclose the company’s financial position and performance with reasonable accuracy; and to enable directors to ensure that the financial statements comply with the Companies Ordinance.
    • In particular, the accounting records must contain:
      • daily entries of all sums of money received and expended by the company, and the matters in respect of which the receipt and expenditure takes place; and,
      • the assets and liabilities of the company.
  • Where to keep the accounting records:
    • A company’s accounting records must be kept at its registered office or any other place that the directors think fit, and must be open to inspection by the directors at all times without charge; and,
    • If a company’s accounting records are kept in a location outside Hong Kong, the accounts and returns must be sent to a place within Hong Kong. Those accounts and returns must disclose with reasonable accuracy the financial position of the business in question at intervals of not more than six months.
  • How long accounting records are to be preserved:
    • The company must preserve the records for seven years after the end of the financial year to which the last entry was made.
  • Penalties for not complying with the bookkeeping requirements:
    • a director of a company who fails to take all reasonable steps to secure compliance with the bookkeeping requirements commits an offence and is liable to a fine of HK$300,000.

Financial Reporting Requirements

Statutory reports are required annually for companies incorporated in Hong Kong. The reports must contain audited financial statements for the current year, with corresponding amounts for the preceding year, including a balance sheet, profit and loss account, and a cash flow statement. Audited financial statements must be prepared and signed off by a certified public accountant on behalf of a business or non-profit organization, to provide financial accountability and accuracy to a company’s stakeholders and people with a vested interest in the company.

[tips title="Important Tip"]Companies incorporated outside Hong Kong but have a place of business there should register as a foreign company with the Registry. If required to publish their financial statements under the laws or regulations of their incorporated place, the foreign company should file its financial statements in the annual return to the Registry.[/tips]

Foreign companies whose securities are publicly traded in the Hong Kong Stock Exchange may prepare financial statements in accordance with either the HKFRS or the IFRS, or under certain limited conditions of other reporting frameworks, such as the China Accounting Standards for Business Enterprises (ASBE) and Generally Accepted Accounting Principles in the United States of America (US GAAP).

Note: Section 51C of the Inland Revenue Ordinance provides a more specific list of the records to be kept. 

To prepare financial statements, certain documents might be required according to the instructions by Inland Revenue Department. These are as follows:

Documents to be Maintained for Financial Statements by Type of Transaction


Record to be maintained


Sales invoice

Goods return note

Receipt slip

Daily receipt record


Purchases invoice

Petty cash voucher

Payment slip

Check stub


General expenses

Expenses invoice

Payment receipt

Check stub

Salary record

Bank transaction

Bank statements

Bank paid-in slip and related receipt details

Check stub and copy

Tangible assets

Purchase and sale agreement

Invoice and receipt

Check stub and copy


Purchase and sale agreement

Invoice and receipt

Check stub and copy

Inventory list (including quantity and unit cost on every item)

Obsolete or slowing-moving inventory


Security ask/bid confirmation slip

Purchase and sale agreement

Capital inspection report (apply for PRC investment)

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