The accounting entity is the spatial scope of corporate accounting recognition, measurement and reporting. For example, if the fund movement that Huawei's accountants want to describe is the capital movement within the spatial scope of Huawei, and it is reflected and described from the perspective of Huawei, then Huawei is an accounting entity.

Generally speaking, any economic organization with independent accounting can become an accounting entity. For example: a workshop with independent economic accounting can be recognized as an accounting entity, and an accounting system can be set up to describe the movement of funds within that space. In addition, economic organizations that can become accounting entities also include: enterprises, enterprise groups (that is, a consortium of enterprises composed of a parent company and subsidiaries), public institutions, etc.

A legal person is an organization that enjoys the qualifications of a civil subject. The law gives it the same personality as a natural person so that it can independently exercise its rights and assume its own obligations. To become a legal person, you must first be economically independent. From this perspective, a legal person must be an accounting entity, but independent accounting alone is not enough to support its legal person status. Therefore, a legal person must be an accounting entity and an accounting entity. It is not necessarily a legal person. For example: enterprise groups and independent accounting workshops of enterprises are accounting entities rather than legal entities.

In short, accounting should only serve specific accounting entities. The accounting entity assumption requires an enterprise to conduct accounting recognition, measurement and reporting of its own transactions or events, reflecting the various production and operating activities of the enterprise itself. Clearly defining the accounting entity is an important prerequisite for carrying out accounting recognition, measurement and reporting work.

Delineate the spatial scope of each matter to be handled by accounting

Distinguish an accounting entity's transactions or events from those of the accounting entity's owners and those of other accounting entities

It is assumed that the business will not go bankrupt and be liquidated in the foreseeable future. That is to say, it is assumed that the business activities of the enterprise are in a normal operating state.

The going concern assumption provides a normal business background for accounting.

Accounting installments artificially divide the ongoing capital movement of an enterprise into several periods to provide accounting information in installments.

There are usually four calibers of accounting periods: annual, semi-annual, quarterly and monthly. The statements prepared on an annual basis are annual reports, and the statements corresponding to other periods are interim reports.

The purpose of accounting period assumptions is to provide accounting information in segments to achieve the purpose of reflecting and supervising the movement of corporate funds in real time.

Accounting only reflects information that can be expressed in currency. If a piece of information should be included in the accounting system, but cannot be expressed in currency, it can only be excluded from the scope of accounting. For example, human resources should be reflected in the accounts as a key asset of the enterprise. However, the monetary measurement of human resources is not yet widely operable in practice, so most enterprises do not reflect human resources.

Currency value stability assumption. For the stability of accounting information, the currency measurement assumption also includes the assumption that the currency value remains unchanged.

Among the many measurement methods, only the monetary standard has the greatest degree of indifference and unity. The monetary measurement hypothesis selects the main accounting method for the development of accounting activities.

Our country stipulates that corporate accounting uses RMB as the standard currency for accounting. Foreign-invested enterprises can choose foreign currencies as the standard currency for accounting, but they should provide statements reflected in RMB. When overseas enterprises submit statements to the country, they should be converted into RMB. .

The accrual basis requires that all income that has been realized and expenses that have been incurred or should be borne in the current period, regardless of whether the money is received or paid, should be included in the income statement as income and expenses for the current period; all income and expenses that do not belong to the current period should be included in the income statement. Even if the money has been received and paid in the current period, it should not be regarded as income and expenses for the current period.

The cash basis is the opposite of the accrual basis, that is, the receipt and payment of cash is used as the criterion for determining the attribution period of income and expenses. When the business is not important, the cash basis can be simplified. Therefore, the cash basis The application embodies the importance requirements.

Enterprises should conduct accounting recognition, measurement and reporting based on actual transactions or events, and truthfully reflect the transactions or events they should reflect.

Enterprises should ensure the integrity of accounting information on the premise of complying with the principles of importance and cost-effectiveness.

Accounting information included in financial reports should be neutral and unbiased

Comparability of different accounting periods of the same enterprise is called vertical comparability; in order to meet this requirement, when an enterprise chooses accounting methods, it should ensure consistency in the previous and later periods. Even if the accounting policy changes, the accounting standards should be adjusted according to the prescribed method to ensure that the accounting methods are consistent. Ensure that the accounting information is consistent in the previous and later periods.

Comparability between different enterprises within the same accounting period is horizontal comparability. In order to meet this requirement, enterprises should adopt methods uniformly prescribed by the state for accounting treatment.

Conversion from cost method to equity method due to capital reduction

Retrospective adjustment based on changes in accounting policies

Retrospective restatement method based on correction of accounting errors

Preparation of consolidated statements by adjusting subsidiary accounting policies and accounting periods to parent company standards

Under the equity method, the investee's net profit should be adjusted to the investor's accounting policies and accounting period standards before determining investment income.

The recording cost of long-term equity investments under common control should be determined based on the book net assets after the merged party adjusts the accounting policies and accounting periods of the investor.

Preparation of consolidated statements

Accounting treatment for after-sales repurchases

Accounting treatment of goods sold by installment payment

Definition of right-of-use assets

When the amount reaches a certain level, it should be defined as important information

Indicators are essentially important information, such as net profit

Selection of offset contents in consolidated statements

Interim reports do not need to disclose detailed accompanying information like annual reports.

Discrepancies between inventory surplus and fixed assets surplus

Provision for asset impairment provisions

accelerated depreciation method

Handling of contingencies

Assets refer to resources formed by past transactions or events of an enterprise, owned or controlled by the enterprise, and expected to bring economic benefits to the enterprise.

Assets are expected to bring economic benefits to the business

Assets become resources owned or controlled by the enterprise

Assets are formed from past transactions or events of the enterprise

The economic benefits associated with the resource are likely to flow to the enterprise

The cost or value of the resource can be measured reliably

Liabilities refer to current obligations formed by an enterprise's past transactions or events that are expected to result in an outflow of economic benefits from the enterprise. Current obligations refer to obligations that an enterprise has assumed under current conditions. Obligations arising from future transactions or events are not current obligations and should not be recognized as liabilities.

Liabilities are current obligations borne by a company

Liabilities are expected to cause economic benefits to flow out of the company

Liabilities are formed by past transactions or events of the company

The economic benefits related to the obligation are likely to flow out of the enterprise

The future outflow of economic benefits can be measured reliably

Owner's equity refers to the remaining equity enjoyed by the owner after deducting liabilities from a company's assets.

Invested capital - corresponding to: equity or paid-in capital, capital reserve - equity premium (capital premium) account

Gains and losses recorded directly into owners' equity - corresponding to: other comprehensive income accounts

Retained earnings - corresponding to: surplus reserve, profit distribution - undistributed profit account

Gains refer to the inflow of economic benefits that are formed by non-routine activities of an enterprise, lead to an increase in owner's equity, and have nothing to do with the capital invested by the owner.

Gains include two types:

Loss refers to the outflow of economic benefits caused by the non-routine activities of the enterprise, which will lead to the reduction of owners' equity and has nothing to do with the distribution of profits to owners.

There are two types of losses:

The recognition of owners' equity depends on the recognition of other accounting elements.

Income refers to the total inflow of economic benefits formed in the daily activities of an enterprise, which will lead to an increase in owner's equity and has nothing to do with the capital invested by the owner.

Income should be generated by the enterprise in its daily activities

Income is the total inflow of economic benefits independent of the capital invested by the owner

Revenue should ultimately result in an increase in owner's equity

The enterprise should recognize revenue when it fulfills its performance obligations in the contract, that is, when the customer obtains control of the relevant goods.

Expenses refer to the total outflow of economic benefits incurred by an enterprise in its daily activities that will lead to a reduction in owners' equity and are not related to the distribution of profits to owners.

Expenses should be incurred by the enterprise in its daily activities

Expenses should result in an outflow of economic benefits excluding profit distributions to owners

Expenses should ultimately result in a reduction in owner's equity

The economic benefits associated with the expense are likely to flow out of the business

The outflow of economic benefits from an enterprise will result in a decrease in assets or an increase in liabilities.

The outflow of economic benefits can be measured reliably

Profit refers to the operating results of an enterprise during a certain accounting period

Profit = Income - Expenses Asset disposal gains and losses Non-operating income - Non-operating expenses

The recognition of profit depends on the recognition of various elements in the above formula.

Gains are mainly divided into two categories:

Income is the inflow of major economic benefits included in the scope of operating profits

Losses fall into two main categories:

Expenses are the outflow of major economic benefits included in operating profit

historical cost

replacement cost

net realizable value

present value

fair value

Historical cost usually reflects the past value of an asset or liability, while replacement cost, net realizable value, present value and fair value usually reflect the current cost or current value of an asset or liability, which are measurement attributes corresponding to historical cost. .

Historical cost - Generally, historical cost is used when measuring accounting elements.

Replacement cost - the recording costs of surplus inventory and surplus fixed assets are all based on replacement cost.

net realizable value

present value

fair value

Financial reports refer to documents provided by an enterprise to the outside world that reflect the enterprise's financial status on a specific date and operating results, cash flow and other accounting information during a certain accounting period.

balance sheet

income statement

cash flow statement

Statement of changes in owner's equity (or shareholders' equity)

Note

Adhere to integrity, abide by the law and serve the public

Adhere to principles, abide by responsibilities and work hard

Persist in learning, be upright and innovative

Integrity, objectivity and independence

Professional competence and diligence, confidentiality and good professional conduct