fs-tie-out-helper

FS Tie-Out Helper

This skill performs the mechanical-but-critical tie-out of a draft set of financial statements: it foots and cross-foots each primary statement, agrees every face-of-statement caption back to a mapped trial balance, confirms the balance sheet balances, reconciles the cash flow statement's net movement in cash to the balance-sheet cash delta, and raises every difference as a tickmark-style finding. It is for auditors performing year-end tie-out, reviewers performing a casting check, and preparers self-checking a draft before issue. The methodology follows generally accepted casting and agreement procedures referenced in ISA 320/ISA 450 (materiality and evaluation of misstatements) and the presentation requirements of IAS 1 / IAS 7 (or ASC 205 / ASC 230 under US GAAP).

When to use this

• An auditor or reviewer needs to cast (foot/cross-foot) draft financial statements and agree them to the trial balance.
• You have a TB extract plus a draft balance sheet, income statement, and cash flow and need a documented tie-out.
• The balance sheet does not balance and you need to localize the breaking caption.
• The movement in cash per the cash flow statement does not equal the year-on-year cash delta on the balance sheet.
• You need a tickmark workpaper showing what footed (F), what agreed to TB (TB), and what is untied.
• You suspect rounding-driven inconsistencies (e.g. subtotals shown to the nearest thousand that no longer add).

Do NOT use this to perform substantive testing, conclude on materiality, or sign off; it checks internal arithmetic and agreement only.

Inputs

Provide at least the trial balance and the statement captions. Tabular inputs as CSV/xlsx are strongly preferred.

1. Trial balance with a mapping column. Columns: account_code, account_name, debit, credit (or a single signed balance), and a fs_line mapping each account to a financial-statement caption. Both current and prior period if available.
2. The drafted statements - either as a structured CSV of statement, caption, current, prior, or extracted from a narrative/Word/PDF set of financials.
3. The reporting convention (IFRS or US GAAP), presentation currency, and the rounding unit actually used on the face (units, thousands, millions).
4. Performance materiality and a "trivial threshold" (clearly trivial amount under ISA 450) if known, so findings can be ranked. If not supplied, report all differences and mark thresholds as "to be confirmed".

A bundled synthetic sample is provided: samples/trial_balance_sample.csv (Aurora Components Ltd, fictional). Use it to dry-run the methodology.

How to do it

Work through the statements in this order. Document every check as a tickmark so the workpaper is self-explaining.

Tickmark legend (use consistently):

• F = footed (sum of detail equals the printed subtotal/total)
• CF = cross-footed (row total agrees to the sum across columns, or column total to sum of rows)
• TB = agreed to mapped trial balance
• PY = agreed to prior-year signed-off comparative
• ^ = recalculated, no exception
• X = exception / does not tie (must be listed in Findings)

1. Normalize and validate the trial balance.

• Confirm the TB itself balances: total debits = total credits, or sum of signed balances = 0. If not, stop and report; nothing downstream can tie.
• Sign convention: adopt one rule (e.g. assets/expenses positive, liabilities/equity/income negative as credits) and apply it everywhere. Record the convention used.
• Confirm every account has exactly one non-blank fs_line. Unmapped or multi-mapped accounts are a finding (X - mapping gap) because they will silently drop out of the agreement.

2. Build the TB-to-FS expectation. Group the TB by fs_line and sum, per period. This produces the expected amount for each caption directly from the ledger. Keep it separate from the drafted statement figures so you are comparing two independent sources.

3. Foot and cross-foot each statement (F, CF).

• Recompute every subtotal and total from its components rather than trusting the printed number. Examples: current assets = sum of current-asset lines; total assets = non-current + current; gross profit = revenue - cost of sales; profit before tax = operating profit + net finance; profit for the year = PBT - tax.
• Cross-foot where a statement has both a current and prior column, or where a movement table (e.g. equity) must reconcile across columns and down rows. The corner total must equal both the sum of row totals and the sum of column totals.

4. Agree each caption to the TB expectation (TB). For every face caption, compute difference = drafted - TB_expected. A nil difference ties. Any non-nil difference is a finding; localize it to the contributing account(s) by drilling into that fs_line group.

5. Confirm the balance sheet balances. Check Total assets = Total equity + Total liabilities for each period. If it does not balance, the out-of-balance amount equals the net of all caption-level X differences on the balance sheet; use step 4 differences to pinpoint the cause rather than guessing.

6. Agree the cash flow to the balance-sheet cash delta (IAS 7 / ASC 230).

• Net increase/(decrease) in cash = Operating CF + Investing CF + Financing CF. Re-foot the three sections.
• Closing cash = Opening cash + net movement. Opening cash must agree to PY balance-sheet cash and closing cash to CY balance-sheet cash (and to cash equivalents per the IAS 7 reconciliation). Any FX-on-cash line must be presented separately and included in the movement.
• Independent reasonableness check: the movement in cash should be explainable by the deltas in other balance-sheet captions (working-capital movements, capex via PP&E roll-forward, debt drawdowns/repayments). Large unexplained residuals are a finding even if the statement internally foots.

7. Check rounding consistency. When the face is presented in thousands/millions, a subtotal rounded independently can differ from the sum of its rounded components by 1 unit. Recompute totals from the rounded components: a one-unit "plug" difference is a presentation rounding finding (note it, suggest a consistent rounding policy or a disclosed rounding note), whereas a difference larger than the maximum achievable rounding drift (roughly half a unit per aggregated line) is a real exception, not rounding.

8. Rank findings against materiality (ISA 450). Tag each X as: trivial (below the clearly-trivial threshold - typically a small percentage of performance materiality), to-be-evaluated, or material. Never conclude on materiality yourself; present the ranking for the engagement team to evaluate.

Output

Produce a Markdown tie-out workpaper, plus (when inputs were tabular) a companion CSV of the line-by-line agreement.

Workpaper (fs_tie_out_workpaper.md):

• Header: entity, period end, currency, rounding unit, reporting framework, preparer/reviewer placeholder, date, and the tickmark legend.
• Section 1 - TB integrity: debits vs credits (or signed sum), mapping completeness.
• Section 2 - per statement (Balance Sheet, Income Statement, Cash Flow, and any movement schedule): a table with columns Caption | Drafted CY | TB/Expected CY | Diff CY | Tickmark | Drafted PY | Diff PY.
• Section 3 - balance sheet balances check (assets vs equity+liabilities, both periods).
• Section 4 - cash flow agreement (section foots, opening/closing cash agreement to the balance sheet, residual vs BS deltas).
• Section 5 - Findings register: Ref | Statement | Caption | Difference | Likely cause | Tickmark | Materiality tag.
• Section 6 - conclusion line: "Tie-out complete with N findings; M untied differences remain for engagement-team evaluation."

Companion CSV (fs_tie_out_detail.csv): columns statement,caption,drafted_cy,expected_cy,diff_cy,drafted_py,expected_py,diff_py,tickmark,note. One row per caption so it can be re-sorted or pivoted.

Quality checks

• The sign convention is stated once and applied identically to TB grouping and to every statement.
• Every TB account maps to exactly one caption; the sum of all caption expectations equals the TB net (which is zero overall when assets - liabilities - equity - P&L closes through retained earnings).
• Differences are computed as drafted - expected, never the reverse, so signs are consistent across the register.
• Distinguish genuine exceptions from one-unit rounding drift; do not bury a real error inside a "rounding" tickmark, and do not raise rounding noise as a material finding.
• Cash per the cash flow agrees to cash on the balance sheet at BOTH opening and closing - agreeing only one end hides an opening-balance error.
• Prior-year comparatives agree to last year's signed-off statements (PY), not just to the current TB.
• Common errors to avoid: trusting printed subtotals without recalculating; ignoring unmapped TB accounts; netting a debit and credit difference to a misleading nil; treating the balance-sheet plug as immaterial without localizing it; forgetting the IAS 7 FX-on-cash line.

Worked example

Using samples/trial_balance_sample.csv (Aurora Components Ltd, all figures in EUR thousands, IFRS):

1. TB integrity: sum the signed balances - they net to zero, so the ledger balances. Every account carries an fs_line.
2. Build expectations by grouping on fs_line: e.g. current-period total assets expected = PP&E + inventory + trade receivables + cash = 4,200 + 1,150 + 980 + 540 = 6,870.
3. Foot the balance sheet: total equity + liabilities = share capital 1,000 + retained earnings 3,090 + borrowings 1,800 + trade payables 980 = 6,870. Assets 6,870 = Equity + Liabilities 6,870, so the balance sheet balances (F, ^).
4. Foot the income statement: revenue 8,400 - cost of sales 5,460 = gross profit 2,940; less operating expenses 1,900 = operating profit 1,040; less net finance 140 = PBT 900; less tax 225 = profit for the year 675 (F).
5. Cash flow: operating 1,310 + investing (900) + financing (350) = net movement 60. Opening cash 480 (agree to PY balance-sheet cash) + 60 = closing cash 540, which agrees to CY balance-sheet cash 540 (TB, ^).
6. Rounding: recompute current assets from rounded components - they add cleanly, no one-unit drift, so no rounding finding here.

If you then change drafted closing cash to 545 while the balance sheet still shows 540, the workpaper raises an X: cash flow closing cash does not agree to the balance sheet by 5; likely cause is an unfooted financing line; tagged for evaluation against the engagement threshold.

Disclaimer

Disclaimer: This skill is a drafting and analysis aid, not professional advice. It does not provide accounting, audit, tax, investment, or legal advice. All output must be reviewed and approved by a qualified professional before use or reliance.

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