Balance Sheet

The Balance Sheet represents the financial state of your business as it was on a specific date. That is, how much money there is in the bank, how much the business owes, how much is owed to the business, how much equity there is in the business (ie. how much is owed to the owners of the business) and how much profit or loss the business has made for the current period up to the date of the report. As is often said, it is a snapshot of your business at a certain point in time.

You can make as simple or as detailed a balance sheet as you need by opening or closing different groups in the Chart of Accounts.

At the very simplest level, you could show just the Assets, Liabilities and Equity groups (ie. close all sub-groups within each of the main groups). You can prove that the balance sheet actually balances by applying the standard accounting equation:

Assets = Liabilities + Equity

If you want to memorise this, use the acronym ALE.

A more detailed (and typical) balance sheet will show the current asset and liability accounts in full but only the overall Profit and Loss account balance (the Profit and Loss account report will show the detailed view) together with the other Equity accounts.

What matters is that you have complete control over the level of detail of the report.

To view the report, set the End Date in the Chart of Accounts to your financial year end date (Important: leave the Start Date disabled and ‘Include Closing Year Transfers’ box should be ticked).

Click on the Balance Sheet button in the Chart of Accounts toolbar, then click on the Design/Print tab at the bottom to view and print your report.