The balance sheet is the financial statement showing a firm’s assets, liabilities and equity (capital) at a set point in time, usually the end of the fiscal year reported on the accompanying income statement. The total assets always equal the total combined liabilities and equity in dollar amount. This statement best demonstrates the basic accounting equation – Assets = Liabilities + Equity. The statement can be used to help show the status of a company.
Accounting standards often set out a general format that companies are expected to follow when presenting their balance sheets. International Financial Reporting Standardsnormally require that companies report current assets and liabilities separately from non-current amounts