Balance Sheet Reports
A balance sheet is one of the financial statement reports summarizing
what your company owns (assets), owes (liabilities), and the net worth of your company (equity) at a particular point in time.
You normally print a balance sheet at the end of an accounting period, after making the necessary accruals and adjustments.
To view a balance sheet report, open the Report Centre in the Home window, select Financials, Balance Sheet, and then the balance sheet report by name. Click Display.
Understanding the Balance Sheet
Assets
Assets are the things you own. Analyzing your assets can help you to determine how liquid your company is. Do you have too much or too little inventory on hand? How about cash? Are most of your assets located in long-term items, like vehicles or buildings, meaning that you can't readily convert your assets into cash? You might want to pay special attention to your receivable accounts, which indicate how much money you are owed.
Liabilities
It is important to understand what you owe to others, on both the short term and long term. How much do you owe creditors? How much of it will you need to pay in a short time? You should also compare short-term (current) assets to short-term liabilities and long-term assets (like capital assets) to long-term liabilities (like a loan repayment scheduled over a number of years). If, for example, you hold a lot of short-term debts relative to short-term assets, you may be unable to fulfill your financial obligations.
Equity
The equity section represents the net worth of the company. Often, for small-business owners, the equity section includes both the owner's investment and the accumulated net worth of the company. For larger companies, this section can also include other amounts, such as those received from stock offerings. Examining the equity in your company gives you an idea of what the company is worth. Creditors are also interested in what proportion of your assets is furnished by liabilities and what proportion by equity.
Industry-Specific Reporting
- Manufacturers, wholesalers and retailers would typically want to group their inventory asset accounts together in product categories on the balance sheet. Similarly, they would want to group revenues and expenses associated with selling the inventory along similar product categories.
- Construction companies and other companies who use inventory items but who do not explicitly sell inventory items would normally use a different structure for their income statement, although their balance sheet would remain unchanged
Types of Balance Sheets
- Comparative Balance Sheet — The comparative balance sheet compares the current period with the previous accounting period.
- Multi-period Balance Sheet
- Departmental Balance Sheet Report
- Comparative Subsidiary Balance Sheet