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Does 56ACC understand logistics accounting

PostPosted: Fri Nov 21, 2014 4:31 am
by 56admin
The characteristics of Accounts Receivable of international freight forwarding industry
 1. Multi-currency, changing exchange rates and payers in different countries under different jurisdictions
 2. Seasonal price & CAF, Bunker results in frequent change in quotes, late billing, frequent amendment on invoices, issuance of debit note and credit note, supplementary invoice
 3. Voluminous transactions
 4. Integrated logistics service and charges
 5. Incoterms is necessary to identify billing party
 6. COD term for new customers
 7. Payment and collection on behalf of others
 8. Set off against AR and AP
 9. Intercompany and Agent reconciliation
 10. Summary invoice and Interfacing transactions among customers and vendors
 11. Frequent review on credit limit especially overseas agent
 12. Multi billing and payment locations
 13. Tax invoices in China
 14. Revenue recognition is difficult due to different incoterms, import & export and, integrated services

The characteristics of Accounts Payable of international freight forwarding industry
 1. Audit on payment is difficult due to voluminous transactions, integrated services and seasonal prices and different Incoterms
 2. On time payment is necessary to ensure the reliability supply of cargo space
 3. Late billing or debit note or credit note by agents is common
 4. TT payment to agents in overseas
 5. Dispute and transactions which need clarification is common
 6. Payment should be checked against billing to avoid omission of billing
 7. Payment should be processed after netting of Accounts Receivable
 8. Tax invoices is necessary before payment in China

The characteristics of taxation for international freight forwarding industry
 1. Profit tax is one of the lowest in HK
 2. No GST/VAT in HK
 3. Offshore income is free of tax in HK
 4. Subject to different taxations in different countries
 5. Transfer pricing applies to each transaction

The characteristics of critical costs for freight forwarding industry
 1. Sharing costs
 2. Unnecessary costs, KPI and Improvement in efficiency
 3. Cost reducing snowball cycle
 4. Open sourcing
 5. Unabsorbed cost
 6. Idle cost
 7. Taxation cot
 8. Consolidation and equalization
 9. Contingent cost, mishandling, claim and compensation, over-specification

The characteristics of pricing for freight forwarding industry
 1. Seasonal pricing
 2. Penetrating price for developing of new business operating unit
 3. Peak seasonal price
 4. Breakeven pricing for idle
 5. Discount price for trial run
 6. Premium service for the best services

The characteristics of IFRS for freight forwarding industry
 1. Lessor accounting
 2. Revenue Recognition
 3. Accrual
 4. Contingent cost

The characteristics of month end closing for freight forwarding industry
 1. Early cut off not possible due to late SOA issues
 2. Revenue and Cost Accrual
 3. Interface from operating to accounting
 4. Intercompany reconciliation and agent reconciliation