Securities Sponsor Representative (China) cheat sheet

Role knowledge and relevant Chinese foundations

• Identify the instrument, actor and activity.

• Exchange review and CSRC registration do not guarantee investment value.

• Suitability does not eliminate loss.

• Separate accounting results, cash and a conditional valuation.

• Define the market, transaction, period and responsibilities.

• Test statements through relevant evidence and contradictions.

• Match conditions to the actual board and transaction.

• Keep disclosure and continuing duties visible.

• Cost of sales includes carriage inwards and excludes carriage outwards

• Closing inventory affects both the trading account and the balance sheet

• Drawings reduce capital and are never an expense

• An increase in the doubtful debts provision is charged to profit and loss

• Capital = opening capital + net profit − drawings

• Issued capital and actual cash received are different concepts.

• Share premium in the supplied par-value model is not sales revenue.

• Distinguish equity distributions from interest on liabilities.

• Prime cost includes direct materials consumed, direct labour and direct expenses

• Cost of production adds production overheads and adjusts for work in progress

• Selling and administration costs are not production costs

• Inventory is valued at the lower of cost and net realisable value

• Link each procedure to an assertion or criterion.

• Tracing and vouching direction can change the question answered.

• Existence, ownership, completeness and valuation need distinct evidence.

• Sample size does not cure an incomplete or biased population.