How often should a Hong Kong company update its books?
The law requires records that show the financial position accurately at any time, and where records are kept abroad, accounts and returns every six months at most. In practice, monthly updating, with a bank reconciliation, is the sensible standard for most SMEs.
What the law says
- Section 373: accounting records must disclose, with reasonable accuracy, at any time, the company's financial position and financial performance, and must include daily entries of money received and spent.
- Section 374(3): where records are kept outside Hong Kong, the accounts and returns kept in Hong Kong must show the financial position at intervals of not more than 6 months.
There is no statutory instruction to post entries on a particular day, but a record that is months behind cannot satisfy the "at any time" test.
Practical rhythm
- Weekly: capture invoices, bills and receipts; chase receivables.
- Monthly: reconcile bank and credit cards; run payroll and pay MPF by the 10th; review ageing reports; produce a short management summary.
- Quarterly: review fixed assets, accruals and director balances; prepare for tax instalments if relevant.
- Yearly: closing adjustments, stocktake, audit, financial statements, and filing.
Why monthly works. Errors are fresh, supporting documents are easy to find, and the MPF and other deadlines are not missed. It also keeps year-end costs predictable.
If you have fallen behind, start a catch-up plan now (see our answer on backlogs).
Legal basis
- Companies Ordinance (Cap. 622), ss.373-374
Sources
Applies to 2026 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- Is a Hong Kong company legally required to keep accounting records?Yes. Section 373 of the Companies Ordinance (Cap. 622) requires every company to keep accounting records that explain its transactions and show its financial position and performance at any time. Directors who fail to take all reasonable steps risk a fine of HK$300,000, and up to 12 months' jail if the failure is wilful.
- How long must a Hong Kong company keep its accounting records?Seven years. Under section 377 of the Companies Ordinance, a company must keep its accounting records for 7 years after the end of the financial year to which the last entry relates. The Inland Revenue Department separately requires business records to be kept at least 7 years after the transactions they relate to.
- What does section 51C of the Inland Revenue Ordinance require from my business?Anyone carrying on a trade, profession or business in Hong Kong must keep enough records, in English or Chinese, to work out assessable profits, and keep them for at least 7 years. Failing to do so without reasonable excuse can lead to a fine of up to HK$100,000.
- Which documents should a Hong Kong business keep for its books?Keep every document that supports an entry in your books: sales and purchase invoices, receipts, bank statements, contracts, payroll and MPF records, asset purchase papers, loan agreements, and stocktake sheets. The test is whether someone else could trace any figure back to its source.
- Can a Hong Kong company keep its accounting records digitally or scan paper originals?Yes. The Companies Ordinance allows records in hard copy or electronic form, provided they stay available for reference and can be reproduced on paper. The IRD also accepts electronic books and scanned source documents if integrity, legibility and origin details are preserved, and no prior approval is needed.