Panwa Accounting and Auditing - Thailand ,
Bangkok and Phuket

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Glossary of accounting terms

Primarily, a system of measurement and reporting of economic events based upon the accounting equation for the purpose of decision making. At Panwa Group, it refers to the entity, activity or individuals involved in the application of the accounting equation.

Accounting Period
It is the time period for which accounts are prepared, usually one year.

Accounting System
It is the set of manual and computerized procedures and controls that provide for identifying relevant transactions or events; preparing accurate source documents, entering data into the accounting records accurately, processing transactions accurately, updating master files properly, and generating accurate documents and reports.

It is defined as a natural or juristic person without a Thai nationality.

It is the inspection of the accounting records and procedures of a business, government unit, or other reporting entity by a professional accountant for the purpose of verifying the accuracy and completeness of the records. It could be conducted by a member of the organization (internal audit) or by an outsider (independent audit). At Panwa Group, our specialized group of auditors and accountants performs the auditing process.

A Certified Public Accountant, who is authorized by the governing law, accounting and auditing standards to perform either internal or external auditing services.

Audit Report
It is a signed, written document which presents the purpose, scope, and results of the audit. This may include findings, conclusions, opinions and recommendations. At Panwa Group, Mr. Prasert Poothong is the main signatory of the audit reports.

It is the process of recording of day-to-day business transactions.

Business Entity
It is a selection of the legal form under which a business is to operate: sole proprietorship, general partnership, corporation, a limited liability company and joint venture. At Panwa Group, we take care whatever form of your business is.

Business License
It is a document or permission given to a business owner in order to be legally authorized by law to perform its business activities or services in a certain location. Business Registration
A business should be registered according to its name, type, structure and activities in order to become commonly known, legally and recognize by law.

Compliance Audit
It is the review of financial records to determine whether the entity is complying with specific procedures or rules. At Panwa Group, our specialized team of auditors performs the examination of our clients’ financial records.

Corporate Income Tax
It is a direct tax levied on a juristic company or partnership which is established under Thai or foreign law and carries on business in Thailand or derive certain types of income from Thailand.

External Audit
It is an audit conducted by an individual or firm that is independent of the company being audited. At Panwa Group, the auditors audit the books of a client company generally once a year after the completion of the client company's fiscal year. Their role is to give an opinion of the financials statement's reflection of the status and operations of the company being audited compilations.

Financial Statement
It is a written financial report which quantitatively describes the financial status of a company. This includes balance sheet, income statement, profit and loss, changes in equity and trial balance. At Panwa Group, financial statement determines the profitability and stability of an entity. We usually prepare and compile financial statements on a quarterly and annual basis.

Financial Statement Analysis
It is analysis of financial statement of a company. At Panwa Group, our team of professional accountants does the financial analysis whereas they usually perform in depth financial ratio comparisons over a certain time period.

Fiscal Year
It is the accounting year for a company.

Foreign Business Entity
It is a business entity where half or more of the voting rights or ownership are owned by foreign nationals.

Income Tax
It is a tax imposed on the financial funds or income of a person, corporation or other legal entities. At Panwa Group, we do computations of different income taxes.

It happens when there is a union or merger of already existing corporations to form new or another corporation. At Panwa Group, we provide assistance to our clients when they engaged in incorporation or merger.

Internal Audit
It is an independent function of Panwa Group established and provided for a client company to examine and evaluate its activities within its organization. The objective of internal auditing is to assist members of the organization in the effective discharge of their responsibilities.

Juristic Company
It means a limited company, a limited partnership or a registered ordinary partnership incorporated under Thai or foreign law as well as an association and a foundation engaged in business producing revenue.

Personal Income Tax
It is a direct tax imposed on income of a person or individual.

It is a financial charge imposed against a legal entity's person or property or activity to support the government.

It refers to a legal entity’s person, property or funds subject to taxation.

Trial Balance
It is a listing of the accounts in the general ledger and their balances as of a specified date. It is usually prepared at the end of an accounting period and is used to know if additional adjustments are required to any of the balances. At Panwa Group, preparation of trial balance is important in the financial statement.

Value Added Tax

It is a consumption tax where taxes are imposed at each step of a manufacturing process where value is added to that product at that point in the manufacturing cycle; as well as at the point where the consumer purchases the end product.


It is a document entitling the holder to enter a country. It is either a stamp or a sticker in the passport and is made according to international regulations.

Withholding Tax
It is an amount usually withheld from an employee’s salary to account for that individual’s (payee) tax liability on his/her compensation and paid to the taxation authorities.

Work Permit
Issued to a foreign individual to have permission to work, and render service here in Thailand.