The balance sheet implies the main form of financial reporting, a method of grouping using a table of assets and liabilities of a firm in monetary terms. In this case, it is necessary to balance the balance in some numerical values, reflecting the correctness of the formation of this document.
Instructions
Step 1
Check if the balance sheet is filled in correctly. His table should include assets (current and non-current assets) and liabilities (capital and reserves, short-term and long-term liabilities).
Step 2
Analyze the information contained in the balance sheet. Look at these numbers and amounts at the beginning of the period and compare them with the numbers that are indicated at the end of this reporting period. When establishing an enterprise, accounting equality must be observed, namely: assets must be equal to liabilities. Very often, part of the assets can be contributed not by the owner himself, but by someone else, taking into account this circumstance, the equality will take the following form: assets are equal to the sum of capital and liabilities.
Step 3
Check: the sums of the above two parts of the equation must coincide, because they describe exactly the same objects, but from different points of view. After all, assets reflect what a company's funds are. In turn, liabilities show who invested these funds. At the same time, assets should include all types of funds belonging to the company: equipment, building, stocks of materials, raw materials and goods, vehicles, the amount of debt of customers, suppliers, cash in bank accounts.
Step 4
Check the correctness of the calculation of liabilities, which should consist of the amount of money that the company owes for the goods or services delivered to it, loans.
Step 5
Compare the sums of both sides of the balance. They must be absolutely equal to each other, it does not depend on the value of the operations performed. In turn, the equality of the amounts of assets and liabilities is made in the form of double entry (this is a method of accounting, in which any change in the position of the company's funds is reflected immediately on two accounts).
