The Skills Of Reviewing Financial Statements Are Essential.

Accounting statement is the final product of accounting. It can not show the total economic activity of an enterprise, nor can it rely solely on its verification of all accounting errors and disadvantages.

It is to record and reflect the existing business activities, that is, the existing objective facts, but not to record and reflect the economic activities that have not occurred. That is, the accounting statements are the ex post facto reflection of economic activities, and can not be used to predict and control events in advance and in advance.

The balance sheet is a financial accounting statement that reflects all the assets, liabilities and owners' rights and interests of the enterprise in a particular period (end of the month, the end of the season, and the end of the year). It is a static statement.

The balance sheet is compiled monthly. It is based on the accounting equation of "assets equal to liabilities plus owner's equity". According to certain classification standards and certain orders, assets, liabilities and owners' rights and interests of enterprises in a certain period should be arranged in proper order.

The balance sheet provides information about the current financial situation of the enterprise and the information about the financial situation before and after it shows the strength of the enterprise in terms of assets, liabilities and owner's equity.

1.1 the review and analysis of equilibrium relations.

The form of the balance sheet is the account type, the asset list is on the left side, and the liabilities and owners' equity are listed on the right side.

According to the accounting balance formula, the total assets should be equal to the sum of liabilities and owners' equity.

In the process of examination and analysis, if the imbalance between the two parties is found, enterprises may be found to have errors in accounting. If the total number of items in the same column is not equal to the total number, it is usually calculated that some of the items are wrong.

After imbalance, we should find out the key points of inspection, find out the causes and adjust the accounts.

1.2 review and analysis of the correctness of data sources in the table.

On the basis of checking the balance relationship of balance sheet, we should generally examine the correctness of the data sources in the balance sheet in the following four situations:

(1) review of the number of "early days" and "final numbers".

The items in the balance sheet are listed in the two column of "the beginning of the year" and "the end of the year". The data of the "beginning of the year" are filled in according to the figures listed in the end of last year's balance sheet.

At the time of inspection, we can use the spot check method to calculate the data source in the table to see whether the "number of early days" of the items is consistent with the "final number" of the balance sheet at the end of last year.

(2) direct or calculated items based on the final balance of the relevant general ledger subjects.

Check with the final balance of the relevant general ledger accounts.

Such as short-term investments,

Bad debts preparation, fixed assets original value, accumulated depreciation, short term loans, paid in capital and so on.

In the review, we should pay attention to excluding some factors that should be eliminated, such as bills receivable which have been discounted in notes receivable.

The profit and loss statement is a statement that reflects the realization of profits (losses) in the month, quarter or year, and is compiled monthly.

Through the examination and analysis of the profit and loss statement, we can fully understand the production and operation of enterprises, determine the profits and losses of enterprises, and analyze the economic benefits of enterprises.

Through the analysis of profit and loss items, such as operating profit, investment income and operating income and expenditure reflected in the profit and loss account, we can determine the development trend of enterprise profit and loss and predict the future profitability of enterprises.

Through the analysis of the indicators in the profit and loss account, we can understand the composition of the profits realized by enterprises and the reasons for the change of profits.

2.1 product (commodity) sales revenue review and analysis.

The factors affecting the sales volume of products (Sales) are sales volume and selling price.

When reviewing, the sales volume and unit price shall be examined separately.

The review of sales volume should be consistent with the production and marketing situation at that time, and compare the actual sales volume with the cost of products (commodities).

In case of inconsistency, it is necessary to pay attention to checking whether there are sales products (commodities), not counting the sales volume of products (commodities), and missing the number of sales.

A review of the sales price may be conducted in accordance with the sales price of the product (commodity) sales profit calculation form, to find out if there is any problem of hiding sales revenue.

2.2 product (commodity) sales cost review and analysis.

The selling cost of products (goods) is the actual cost reflecting the main business of products sold by enterprises and providing services.

The main method of cost is to check whether the cost of inventory products (commodities) is correct at the end of the term, because the cost of sale is incorrect, which inevitably leads to the unreal quantity and cost of inventory products.

At the time of examination, the quantity of the final balance after verification shall be calculated according to the average unit cost of the product (commodity), and the inventory product (commodity) cost that should be retained at the end of the term should be calculated and checked with the book number. If the book is larger than the book number, it is indicated that there may be a problem of over selling cost, and further inspection is needed.

2.3 product (commodity) sales tax and additional review analysis.

The taxes and additions of products (commodities) include consumption tax, business tax, urban construction tax, resource tax, land value-added tax and education fee which should be borne by the main business of selling products (commodities) and providing services.

There are three main reasons for the changes in the tax and additional amount of sales of products (commodities): first, changes in tax laws and tax rates; two, changes in the output structure of products (commodities) of different tax rates; and three, false reporting by enterprises.

The "average unit tax" amount in the product (commodity) sales profit calculation table shall be compared with the previous year's amount. If there is any discrepancy between the tax rate and the product (commodity) structure, it is shown that the tax calculation is wrong, and the cause should be further identified.

2.4 examination and analysis of sales profits of products (commodities).

The sales profit of products (commodities) is a major component of the total profit. It is necessary to check whether the enterprise has completed the profit plan, whether it has been increased or reduced in the previous period, and whether it is calculated correctly in the profit and loss account.

During the inspection, the sales profit rate of this period can be compared with the sales profit rate of the previous period and the same period last year. If the change is large, and the scale of production and operation of enterprises has not changed much, it is possible that there is a problem of unrealistic calculation of income and cost, which should be further examined.

2.5 examination and analysis of management fees.

Management cost is the management cost that reflects the organization and management of production and business activities by the administrative departments of enterprises.

Such expenses are usually relatively fixed. If there is a sudden increase in inspection, we should focus on reviewing business practices.