According to the "Regulations on the Implementation of Audit Law of People's Republic of China (PRC)", audit is an independent inspection of accounting vouchers, accounting books, accounting statements and other information and assets related to financial revenue and expenditure by audit institutions, and supervision of the authenticity, legality and efficiency of financial revenue and expenditure.

General company's financial audit has the following three audit methods:

1) Operation audit: audit the organization's operation procedures and methods and evaluate their efficiency and effectiveness;

2) Compliance audit: evaluate whether the organization of this unit complies with the procedures, norms or regulations stipulated by the superior;

3) Audit of financial statements: It is usually to evaluate whether the financial statements of an enterprise or group are prepared in accordance with generally accepted accounting standards, and it is generally conducted by an independent accountant.

Usually every enterprise or company needs to make an audit report before the annual inspection:

1) One-person limited liability company (i.e. wholly-owned natural person enterprise or private limited liability company); ?

2) Foreign-funded enterprises?

3) Listed companies limited by shares; ?

(4) Financial, securities and futures companies; ?

5) Enterprises with long-term liabilities or losses?

(6) Companies engaged in insurance, venture capital, capital verification, evaluation, guarantee, real estate brokerage, entry-exit intermediary, overseas labor agency and enterprise registration agency; ?

7) Companies whose registered capital is not fully paid in installments; ?

8) Companies that have made illegal acts of falsely reporting registered capital, making false capital contributions or withdrawing capital contributions within three years.

Or if the enterprise has significant economic behavior, it must be audited:

Bankruptcy liquidation audit? ; Audit of merger and acquisition; Reform audit; Other special audits: net assets audit, income audit, expense audit, engineering audit and due diligence.