Issue 32, November 2015
The General Administration of Customs released the Announcement on Developing Work Order Write-off of the Processing Trade (Announcement No. 53 ) on 6 November 2015. As a big leap forward from the traditional practice of filed unit consumption write-off in customs’ administrative models, the work order write-off model can help eliminate inventory discrepancies of bonded materials and has the benefit of improving compliance practices of processing trade enterprises and reducing their implicit compliance cost. The model, however, sets higher requirements for the ERP (Enterprise Resource Planning) system, an enterprise’s production procedures and internal control system. Therefore, processing trade enterprises should evaluate the details and implications of this model, and stay informed of the implementation of the model in their customs jurisdictions.