While international harmonization of accounting is gaining momentum in recent years, there is little empirical evidence on whether the harmonization of accounting standards leads to harmonized accounting practices and comparable financial reports. Benefiting from a unique research opportunity in China, this study provides such evidence. Since January 1, 1998, a newly promulgated Accounting Regulation for Listed Companies is in effect. This new regulation is the most comprehensive effort at harmonizing Chinese generally accepted accounting standards (GAAP) with International Accounting Standards (IAS). Based on a sample of listed companies required to reconcile accounting earnings from Chinese GAAP to IAS, we find no evidence that the Chinese government's efforts eliminated or significantly reduced the gap between Chinese and IAS earnings despite harmonized accounting standards. We explore reasons for the continued earnings gap after the 1998 regulation and find that a lack of adequate supporting infrastructure, manifested in excessive earnings management and low quality auditing, may explain the gap.