Every verification involves the price response submitted by the foreign company. Although each verification is different, the following topics are always important:

- Completeness check - In every verification, the Commerce Department needs to establish that all relevant sales (United States sales, home market sales, or third country sales) have been reported. This step usually involves tracing the sales figures reported in the response to the sales journal, or some similar document listing all of the sales, to the financial statement, thus demonstrating that all sales have been reported. This is a more difficult exercise than it appears. As mentioned previously, there may be no regularly kept company book that records sales for only the product under investigation. Even if there is, such a book - like the sales journal - may not be part of the company's audited accounting system. It is essential in these situations that, beginning from the time that they help prepare the response, the company accountants keep systematic worksheets that trace every step from the figures reported in the response to the audited accounts. The Commerce Department will also select random sales documents that are viewed at verification and ask to see whether the transactions have been included in the response's sales listing. The Commerce Department then selects a transaction from the sales listing, and asks to see where it was reported in the response.

- Date-of-sale methodology - The Commerce Department checks the method used to establish the date of sale to make sure the company has not inappropriately shifted sales either inside or outside the period of investigation. Depending on the prices for the transactions included or excluded, the dumping margins could be significantly affected. The degree of scrutiny depends on the Commerce Department staff assigned to the case. The Commerce Department will examine the entire documentation for at least one sale to determine whether the material terms of sale, especially price and quantity, were fixed when the company reports they were fixed.

- Relationship of the parties - To make sure that the foreign company has appropriately classified sales as either 'export price' or 'constructed export price' transactions, the Commerce Department investigates the relationship between the foreign exporter and its United States customers. Again, the degree of scrutiny depends on the Commerce Department staff assigned to the case.

Product comparisons - There may be some controversy concerning the products that are being compared to the products sold in the United States, for example whether they are sufficiently similar to be compared. In that case the verifier will scrutinize the physical examples and will examine any other information relevant to the Commerce Department's standards for 'such or similar' merchandise. These can include records of manufacturing costs, schematic diagrams, product design records and so forth.

- Accuracy of prices - The Commerce Department normally demands not only sales documents, for example purchase orders and invoices, but also detailed proof of payment, including external documents (such as bank statements). The verifier will trace these documents into the company's sales journal and into such accounts as the accounts receivable aging report and general ledger to check whether the foreign company received the amount claimed for each sale.

- Accuracy of adjustments - The verifier will trace to the accounting records any expenses that are the basis for significant adjustments to the price. The Commerce Department also inquires into the allocation of expenses among various products, to make sure that expenses have been properly allocated to the product under investigation. Adjustments that typically receive detailed scrutiny include: rebates and discounts; credit expenses; indirect selling expenses; difference-in-merchandise adjustments; and any large adjustments.

In every verification, there are also particular issues that are specific to that investigation. These issues are usually identified in the Commerce Department's verification outline, which is given to the foreign company prior to the verification.

Source: Business Guide to Trade Remedies in the United States: Anti-dumping, countervailing and safeguards legislation practices and procedures