The Annual Audit Report consists of a balance sheet, an income statement, and a cash flow statement. The report must be conducted by external licensed accounting firms and signed by a Certified Public Accountant (CPA). The audit procedure usually takes two months and the report should be completed within April, in order to meet the May 31st tax reconciliation deadline, which is the second procedure we will see afterwards.
Each company, in order to be prepared for this important step should prepare the following material, that can be divided into two groups. First, we have the accounting related material, which comprehend:
Financial statement and notes;
All accounting books, including foreign currency accounting books;
All accounting vouchers;
Account balance sheet—total accounts from level 1 to detailed opening balance, end balance and accumulated movements;
Bank statement and reconciliation sheet;
Real estate, vehicle ownership certificate;
Fixed assets sheet;
Tax returns and payments by month or quarter.
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