My Audit Diary 1: How did the statement come into being-the promise in the disclosure

A commitment is a fund for expenses incurred at some time in the future. Commitment management enables you to accurately record and analyze these funds. An agreement reached at an early stage of action. "I think this definition is relatively accurate, but there are some ambiguities. This lies in whether the materials and services requested or ordered have a debt-creditor relationship. For example, it is difficult to speculate whether materials and services in transit, as well as materials and services received but not paid, need to be included in the commitment scope of the expenses to be paid. In fact, the debt and creditor's rights are not included, and they should be excluded from the calculation commitment, which is usually manifested in the contract amount estimation. As for whether the commitment is the amount of the signed contract, it is inferred from the annual report that it is indeed presented in this way. The promised amount is reported as the signed but not yet executed contract amount, and the expected contract amount is reported as the authorized but not signed contract amount. From this, we can get a formula "promised amount = contract amount-paid amount-estimated amount". Commitment is generally divided into two parts, one is capital and operation commitment, the other is operating lease commitment, and the first is capital and operation commitment. The former is mainly a long-term contract involving capital and operation, as the name implies, such as a contract involving infrastructure construction or project change of manufacturing enterprises (to be honest, I am not sure about other industries, but I can get information from other annual reports); The latter are some lease contracts, such as the lease of office buildings or employee apartments. For the commitment of capital and operation, the substantive audit procedure is mainly divided into two parts, analysis and compound and detail test. These procedures are based on the management's determination that the management needs to provide the auditors with the corresponding true and fair contract details, and the auditors will summarize and compare them according to this information. In the process of summary, auditors will use the formula between them to control whether the management's report is correct or not. The main criterion to judge whether the commitment is positive or not. In the negative case, auditors usually speculate whether the contract corresponding to the estimated amount is the contract to be reported in the above commitments, and often the estimated amount is too large due to the excessive scope of the estimated contract, so it is necessary to remind the management to make corresponding changes. However, when the commitment is positive, the auditor cannot guarantee that the contract details are filled in correctly, which requires the auditor to control whether the commitment of each contract is positive or not, so as to reduce the mistakes in filling in the list. In the process of summarizing, auditors will also conduct corresponding detail tests, that is, compare the extracted contract with the detailed information of the presented contract to find out errors and omissions. The analysis compound program mainly involves the comparison of time period and time period amount, the reasons for the changes related to customer communication and whether it is reasonable. At the time of disclosure, not only the audited amount should be disclosed, but also the large contract should be disclosed accordingly. The auditing procedures for the disclosure of the expected contract amount, that is, the authorized amount of unsigned contracts, are basically the same, that is, the formula of commitment is not used to control whether the management fills in errors, which can be said to be difficult to control. Then there is the operating lease commitment, which comes from the rental fee in production cost, the rental fee in management fee and the land use fee in management fee, that is, the information related to the rental fee. After summarizing the relevant information, it is necessary to know the specific situation of the contract and confirm whether the contract involves sharing the significant lease amount in the future accounting period. If yes, according to the accounting period (usually years) affected by these long-term contracts, the total lease amount will occur in the following accounting periods. The commitment to detail testing is the same as the commitment to capital and operation, but I haven't learned whether to make an analytical compound. When it is disclosed, it is generally stated as "the minimum lease expenditure for an irrevocable operating lease in the coming year is ……", and major contracts should also be disclosed accordingly. At present, I still don't know whether it is necessary to audit and disclose the expected contract corresponding to such commitments. The above is my experience of sitting down on the promised disclosure part. There must be a lot of unreasonable expenses, please correct me.