The Balance Sheet
Another key report in the end-to-end accounting life cycle is the Balance Sheet.
A Balance Sheet summarizes the financial position of a business at a single moment in
time. That is why it’s commonly referred to as a snapshot of the business. This report
reflects whether the assets that the business owns are enough to offset its liabilities and
leave a net equity balance after all liabilities have been paid off.
Select the tabs in turn.
How to run the Analyzing the Balance Sheet
- Enter the Report Center from the Left Navigation Bar
- Select Balance Sheet from the Business Overview section
- Set the Report period to Last year or enter custom dates 01/01/2018 to 12/31/2018
- Select the Run report button
Analyzing the Balance Sheet
When analyzing the Balance Sheet, the key areas to focus on are:
Reviewing each checking/credit card for an accurate balance
Reviewing accounts receivable
Reviewing any new asset purchases
Reviewing any prepaids and confirming they were accurately categorized
Reviewing loan accounts and making sure they have been reconciled against current
ending balances
Reviewing owner transactions in the equity section
Checking that the net income in the Balance Sheet matches the net income on the Profit
and Loss Report for the same period (e.g. year or quarter end) and the same accounting
method (e.g. accrual)
Let’s take a look at how the conversation between you and Dan might go.
Proving the Balance Sheet
The key areas to focus on are:
Review each checking/credit card for an accurate balance
Review A/R
Review any new asset purchases
Review any prepaid and confirm they were accurately categorized
Review loan accounts and make sure they have been reconciled
against current ending balances
Review owner transactions in the equity section
Check that the net income in the balance sheet matches the Net
Income on the Profit and Loss for the same period and the same
accounting method (e.g. accrual)
Balance Sheet Account
Subsidiary Report that proves the balance
Bank Reconciliation Report
Cash, Checking
Accounts Receivable
A/R Aging or Open Invoices (using “Report Date” method)
Inventory Valuation Summary (or Detail)
Inventory
Fixed Assets
Transaction Detail Report filtered for Account
Other Assets
Transaction Detail Report filtered for Account and/or Reconciliation Report
Accounts Payable
A/P Aging or Open Bills
Reconciliation Report
Credit Card Accounts
Liability accounts
Transaction Detail Report filtered by Account and/or Reconciliation Report
(current or long term)
Saale tax in
Sales Tax Liability Report
payroll tax in
Payroll Tax Liability Report
Equity Transaction Detail Report filtered by Account
