The timing can depend on local practice in China. A reasonable time period to complete all the steps for paying a dividend is approx. 2 months where there is no additional application for treaty relief.

Dividends can only be distributed after the annual financial statements are available after December 31 (fiscal year end).

Generally, audited financial statements prepared in accordance with local accounting/corporate rules are required to show that losses carried forward have been made up, and that required allocations have been made to the statutory reserve fund. The current, distributable profits and retained (undistributed) profits are usually found on the balance sheet, but the precise figures should always be confirmed by the accountant/auditor.

In practice, more often than not, local tax bureaus and processing banks would require the China subsidiary's audited financial statements,  and special audit report, if applicable, to verify the amount of distributable profits.

According to the PRC Company Law, PRC companies can only distribute after-tax profits after: (i) recovering losses incurred in previous years; and (ii) putting aside a legal reserve, which is 10% of its after-tax profit until such a reserve reaches 50% of the registered capital of the company.

The China subsidiary needs to first obtain a tax recordal for the distribution of dividends.

After obtaining the tax recordal, the China subsidiary may then proceed with foreign exchange conversion and remittance subject to review by the processing bank. The outflow of the funds are subject to China's foreign exchange control measures and the bank is the agency to implement such measures for the foreign exchange authority.

There are not many ways to increase reserves. Surplus reserve may be increased by allocation of after-tax profits. Capital reserve can be increased through subscription for registered capital (share capital) at a premium.

Yes, see above ("Are there restrictions on the amount of dividends that can be paid?") and below ("Are there any foreign exchange requirements on paying dividends to foreign parent companies?") for details.

A foreign-invested enterprise needs to first obtain a tax recordal for a distribution of dividends.

Cash cannot be borrowed to settle a dividend.

No prohibition against dividends in kind, but it is rarely used in practice. For China subsidiaries, dividend in kind may not be a realistic option under the current China foreign exchange control regime.

No.

Yes, there are restrictions on lending funds intra-group but cross-border. Generally, there are regulatory restrictions imposed by China foreign exchange administration and the People's Bank of China.