China Securities Journal: 

The MOF recently issued a bulletin on accounting quality inspection. According to it, over 170 accounting firms were punished. We see that the supervision of auditing firms has become stricter and the redline of financial discipline has become more apparent. My question is, what will the MOF do to enforce financial discipline this year? Thank you.

Zhu Zhongming:

Thank you for your attention to financial and accounting supervision. The CPC Central Committee and the State Council attach great importance to this work and General Secretary Xi Jinping has made important instructions on tightening financial discipline and enhancing financial and accounting supervision on different occasions. The MOF has followed and implemented the guiding principles of the important instructions, fulfilled the primary responsibility of financial and accounting oversight, tightened up financial discipline and played an important role in exercising full and rigorous Party self-governance, ensuring financial order, and promoting high-quality social and economic development. 

Recently, the central authorities released a document on enhancing financial and accounting supervision, which stipulated the main aspects of the work, such as establishing a supervision system, developing sound mechanisms, and so on. It is significant in advancing the work in the new era and enforcing financial discipline. The MOF will follow and implement the document, focus on the main responsibility of supervision, clarify incentive and constraint mechanisms, have zero tolerance towards violations of laws and rules and never let financial discipline exist in name only.

In 2023, we will conduct special campaigns on financial and accounting supervision and make efforts in the following three key areas: 

First, we will ensure the implementation of major decisions and deployments made by the CPC Central Committee and the State Council. We will prioritize this on the agenda of financial and accounting supervision work. We will strictly investigate and handle financial infractions that violate the central government's macro decisions, governance, and regulatory requirements and impact the high-quality development of the economy and society. We will ensure that the central government's policies and decisions are implemented smoothly. 

Second, we will adopt more stringent financial discipline and restrictions. We will focus on implementing tax-and-fee policies , tightening the belts of the Party and government institutions, and stepping up efforts to ensure payment of salaries, normal operations, and the basic well-being of the people at the community level. We will also enhance restrictions and supervision and tighten financial discipline.

Third, we will crack down hard on financial and accounting violations. We will adhere to the principles of adopting powerful measures, closing loopholes, imposing severe punishments and promoting integrity. We will strengthen supervision of the quality of accounting information and intermediary institutions' performance, strictly investigate and handle violations such as financial fraud and accounting deceit, resolutely eliminating the "black sheep." 

You mentioned that the MOF punished more than 170 accounting firms last year, which is more than the total of the previous three years. This year, we will intensify our efforts in this regard. In addition to the MOF's direct inspection of 35 accounting firms and 10 asset evaluation agencies, we will organize financial departments nationwide to conduct inspections with broad coverage. We will rigorously handle and punish any breaches uncovered during inspections in accordance with laws, promptly publish inspection announcements and typical cases, and strengthen financial discipline, making it an untouchable "high-voltage wire." Thank you.