Since the international financial crisis, all countries have paid close attention to the health of central bank assets and liabilities at the macro and micro levels. In particular, the outbreak of the subprime mortgage crisis in 2008 and its subsequent spread into a global financial crisis further aroused countries' heightened attention to central bank balance sheets and their crisis response capabilities. The meaning of the central bank's balance sheet. As one of the accounting statement systems of the People's Bank of China, the balance sheet of the People's Bank of China comprehensively reflects the assets, liabilities and ownership of the People's Bank of China at a certain point in time according to the basic accounting balance equation of assets = liabilities + owners' equity. A report on the composition of shareholders’ equity. Generally speaking, the total assets of the central bank's balance sheet can be roughly divided into three parts: domestic credit, foreign assets and other assets; the total liabilities can be roughly divided into three parts: deposits, currency issuance and bond issuance. Among them, foreign assets include foreign exchange, monetary gold and other foreign assets; domestic credit includes claims on the government (basically the central government), other depository companies, other financial and non-financial companies; deposits include reserve deposits and government deposit. One of the most important subjects on the asset side of Western central banks is government claims. The government claims of the United States and Japanese monetary authorities account for the highest proportions, accounting for 86.06% and 63.32% respectively. The government claims of European monetary authorities are more important, accounting for 21.48%. . Correspondingly, the most important account on the liability side is currency, with the United States, Japan, and Europe accounting for 85.44%, 73.04%, and 44.78% respectively. Compared with developed central banks such as the United States, Japan, and the European Union, the balance sheet of the People's Bank of China is exactly the opposite. The characteristics of the balance sheet of the People's Bank of China are: the People's Bank of China has the lowest proportion of government debt and a low proportion of currency. The asset side has the highest proportion of foreign exchange assets (68.09%), and the liability side has the highest proportion of reserve deposits (40.45%). What is a healthy balance sheet? The central bank's balance sheet reflects the central bank's source of funds and the allocation of funds among various financial assets. It is not only the result of the implementation of monetary policy, but also reflects the implementation of the People's Bank of China as an important macroeconomic control department of the country. The effects of monetary policy, maintaining financial stability and developing financial services are also the basis for further implementation of monetary policy. The health of the central bank's balance sheet is also the health of the central bank's assets and liabilities. The first criterion for measuring the health of the central bank's balance sheet is the authenticity, completeness and accuracy of the report data, followed by the safety and efficiency of the corresponding assets, and finally the reasonable structure of assets and liabilities. Therefore, carrying out a balance sheet audit to analyze the account settings, structural changes, scale adjustments and asset and liability trends of the balance sheet is conducive to exploring the orientation, capabilities, measures and trends of the central bank's implementation of monetary policy, and is conducive to better utilizing internal audit. Identify and manage advisory roles to minimize central bank risks and maintain the health, safety and soundness of the balance sheet.

(Author's unit: Chengdu Branch of the People's Bank of China)