Basic Accounting Knowledge: Initial Balance

The term balance is the beginning of the term.

The 1. phase of the account balance that has already existed is the amount pferred from the previous period to the current period, or the amount adjusted after the last term balance.

Usually, the balance at the beginning is the balance of the previous account pferred to the current account, which is equal to the last term balance of the corresponding account.

However, due to the impact of the preceding period, changes in accounting policies, and correction of accounting errors in the previous period, the balance of the last period should be adjusted or restated.

The 2. balance reflects the results of previous pactions and the accounting policies adopted in the previous period.

The balance at the beginning should be based on objective economic business, and the result of the paction handled by the audited entity in accordance with the accounting policies adopted during the previous accounting period.

The initial balance of the 3. period is related to the first acceptance of the CPA.

Broadly speaking, whether a certified public accountant is audited for the first time to a financial entity or the continuous auditing business is related to the initial balance audit.

However, in continuous auditing business, CPA usually only needs to pay attention to whether the audited late term balance has been pferred to the current period, or whether it has been adjusted or restated in appropriate circumstances, and seldom needs to implement other special audit procedures.