The State Council, China's Cabinet, recently approved establishing a system of national economic accounting and the compiling of balance sheets for both the central and local governments.

Reportedly, the central government may finish the national account book for 2015, the first balance sheet of State assets and liabilities, by the end of this year.

According to the plan, China will first compile its national assets and liabilities balance sheet, which is expected to offer experience to local governments so that they can draw up their balance sheets later.

The State balance sheets can directly show the assets (financial and nonfinancial) and the liabilities, as well as their distribution and structure, of the government, residents, enterprises and financial agencies at certain periods of time. And the State balance sheets will be an important tool for exposing potential financial risks.

Experts say the establishment of the State balance sheet system shows China's national economic accounting has developed to a higher level.