If you look at the pattern repeat (inside read border on the chart or inside [ ] in the written instructions, you'll notice that on row 1 there are two yarn overs and one decrease. This means that for each 10 stitch pattern repeat, you will increase two stitches and decrease one stitch. On row 2, there's a decrease which means you'll decrease the second stitch you increased in row 1. As a result once you finish row 1, you have 11 stitches in each pattern repeat, and after row 2, you'll have 10 stitches in each pattern repeat. That stitch you loose on row 2, needs to be shown in the chart somewhere so we put a 'no stitch' symbol (a grey square in my charts) as a stitch holder. This is a lot less confusing in the written instructions for the chart as the written instructions just tell you which stitch you'll be working and ignores 'no stitch' stitches. Compare the written instructions with the chart below.
Above is a shawl I'm working on at the moment. And below is the chart and written instructions for the lace pattern (the chart key is the same as for the first example). You can see that in this chart there are lots of grey stitches and it all looks a bit confusing. Each pattern repeat is 19 stitches and I have four stitches extra. So if I work the pattern repeat twice, I will cast on 42 stitches. On row 1, I work two yarn overs and two decreases so the stitch count stays the same. But I've still got grey squares on row 1. In this lace pattern, the grey squares are to allow for different stitch counts on various rows and also to show how the stitches line up against those in the rows below and above.
On row 2, I work two decreases but no increases (yarn overs). I therefore finish row 2 with two stitches less per pattern repeat - 38 stitches. On row 3, I work two decreases but four yarn overs. I have two stitches in hand from row 2, so that means that after row 3 my stitch count is back to normal - 42 stitches. On row 4, I decrease two stitches per pattern repeat so I have two stitches less again. On row 5, I work two decreases plus eight yarn overs. I have two decreases in hand from row 4 plus two decreases from row 5 which makes it a total of four stitches but I've increased eight. So after row 5, I have four stitches extra per pattern repeat, ie a total of 50 stitches. On rows 6 and 7, I decrease two stitches per pattern repeat per row. Those four stitches I've decreased per pattern repeat on these two rows, make up for the four extra yarn overs I worked on row 5. So now my stitch count is back to normal.