After a decade-long review, China was this week celebrating its decision to bring accounting and auditing practices in line with international standards.

Jin Renqing, finance minister, presided at an elaborate ceremony at the Great Hall of the People in Beijing that was attended by many Chinese officials and international accountancy celebrities.

"This is a milestone for the accounting and audit industry in China which will move the country towards a more modern economic model and help investors make more sensible decisions," said Mr Jin.

It is a milestone that dozens of other countries have passed as they seek to harmonise business practices with the global economy.

But the experiences of China's predecessors ¨C in the industrialised world as well as emerging markets ¨C carry cautionary tales for the Beijing authorities, and for those who rely on Chinese accounts.

According to Deloitte, China will be the 74th country to align itself with international financial reporting standards, joining a group that already includes the European Union's 25 member states.

Actions to adopt IFRS ¨C or to base local accounting systems on IFRS, as China intends ¨C are meant to increase reliability of financial information. That matters because trustworthy accounts are seen to facilitate economic growth.

Sir David Tweedie, chairman of the International Accounting Standards Board, said the decision would "encourage investor confidence in China¡¯s capital markets and ¡­ be an additional spur for investment from both domestic and foreign sources".

The new accounting rules will apply for listed companies from January 1 next year, although blue chip companies quoted in Hong Kong and New York already report under US standards or IFRS.

Called the China Accounting Standards System, the rules include one "basic standard" based on the principles of IFRS, on top of 39 separate standards for different business sectors and 48 auditing benchmarks.

Elsewhere, decisions to adopt "modified" versions of IFRS have caused concern as countries exploit the branding power of international standards but then actually introduce rules that are substantially different.

"In some countries there have been overstated claims about the extent of adoption of IFRS," says John Hegarty, chair of the private sector accounting and auditing committee at the World Bank.

"But the Chinese authorities have been very clear. So long as there is clarity about exactly which standards are applied, users can make informed decisions."

Important exceptions to the IFRS rules in China affect "related party" disclosures and the reporting of assets and liabilities at market values.

David Lindsell, global IFRS director at Ernst & Young, says: "It remains to be seen if China will allow free enterprise accounting without the finance ministry running all over it. Areas like writing down assets are very sensitive. The temptation for governments to interfere can be very high."

Applying the new standards is likely to be fraught with difficulty, not least because local accountancy firms are struggling to stop skilled staff being poached by the big four international firms.

Even in Europe, the transition to IFRS has meant slip-ups, confusion and consternation. The standards require greater precision than before and involve difficult interpretations of broadly framed guidelines.

"It is all new in Europe and will take years to bed down," says Mr Lindsell. "What we¡¯re doing now is effectively a massive experiment."

Richard Martin, head of financial reporting at the Association of Chartered Certified Accountants, says better accounting in emerging markets requires broad reforms.

"The accounting standards are only one component of the financial reporting supply chain," he says. "You also need good corporate governance, qualified auditors and users who understand the information."

The Chinese authorities have focused on education in recent years, but there is widespread concern that the youth and inexperience of many auditors will increase the risk of reporting misdemeanours.