Balance sheet capital. It shows a companys assets liabilities and equity accounts. The balance sheet is a hugely important report and is divided into three main segments assets often divided into current assets and fixed assets liabilities and shareholder equity or retained earnings known as capital and reserves in kashflow. In financial accounting a balance sheet or statement of financial position is a summary of the financial balances of an individual or organization whether it be a sole proprietorship a business partnership a corporation private limited company or other organization such as government or not for profit entity.
The first part of a balance sheet shows all the productive assets a company owns and the second part shows all the financing methods such as liabilities and. The balance sheet shows the financial status of an organisation at a particular instant in time normally at the end of a reporting period such as a financial year half year or quarter. And is usually required by law.
To be considered valid a balance sheet must give a true and fair view of an organizations state of affairs and must follow the provisions of gaap in its preparationalso called statement of condition statement of financial condition or statement of. Balance sheet analysis is a core part of understanding the potential value of your stock market investments or in managing your capital as a. The federal reserves balance sheet.
A balance sheet is a snapshot of a business that shows its assets what is has its liabilities what it owes and what value is left over the equity. An audited balance sheet is often demanded by investors lenders suppliers and taxation authorities. The federal reserve operates with a sizable balance sheet that includes a large number of distinct assets and liabilities.
Assets liabilities and ownership equity are listed as of a specific date such.