The Statement of Financial Position (also known as the Balance Sheet) presents the company’s financial position as of a specific date. It presents assets, liabilities, and equity, and provides users with insights into the business’s solvency, liquidity, and capital structure.
To view the report, Accounting > Statement of Financial Position (Balance sheet)
Assets = Liabilities + Equity
Assets are resources owned or controlled by the company that have value and will provide future economic benefits.
They include:
Non-Current Assets: Long-term items such as property, equipment, and intangible assets.
Current Assets: Short-term items such as inventories, receivables, and cash.
Liabilities are obligations of the company to pay money or deliver services to external parties.
They include:
Non-Current Liabilities: Long-term debts and obligations due after more than one year.
Current Liabilities: Short-term debts and payables due within one year.
Equity represents the shareholders’ interest in the company after deducting liabilities from assets.
It mainly consists of share capital, reserves, and retained earnings (profit or loss).
The trial balance is a list of all accounts and their balances, and the financial position report, or balance sheet, uses these balances to show assets, liabilities, and equity. Revenue and expense accounts from the trial balance are shown in the profit and loss (P&L) report to calculate how much the company earned or spent during a period. At the end of the period, the net profit from the P&L is added to retained earnings, while a loss reduces it. This means changes in P&L accounts affect retained earnings only after the period is closed, and the updated retained earnings then appear in the equity section of the balance sheet.
| No | Grouping Name | GL Accounts Sections Included | Comments |
|---|---|---|---|
| 1 | Cash & Bank | BS Cash, BS Bank Accounts | Dr balances are positive (asset), Cr balances are negative. Includes all cash and bank balances. |
| 2 | Accounts Receivable | BS Trade Receivables, BS Other Receivables | Dr balances represent amounts owed to the company. Include doubtful debts provisions separately. |
| 3 | Inventories | BS Inventory – Raw Materials, BS Inventory – Work in Progress, BS Inventory – Finished Goods | Inventory valued at cost or net realizable value, whichever is lower. Dr positive. |
| 4 | Prepayments | BS Prepaid Expenses | Expenses paid in advance. Dr balances are positive assets. |
| 5 | Property, Plant & Equipment (PPE) | BS PPE – Land, BS PPE – Buildings, BS PPE – Machinery, BS PPE – Vehicles | Valued at cost less accumulated depreciation. Dr balances are positive. |
| 6 | Intangible Assets | BS Intangible Assets – Goodwill, BS Intangible Assets – Software, BS Intangible Assets – Licenses | Capitalized intangible assets less amortization. Dr balances are positive. |
| 7 | Investments | BS Investments – Long Term, BS Investments – Short Term | Includes equity, debt securities. Dr positive, Cr negative if contra accounts exist. |
| 8 | Accounts Payable | BS Trade Payables, BS Other Payables | Cr balances represent amounts owed by the company. |
| 9 | Accrued Expenses | BS Accrued Liabilities | Cr balances for expenses incurred but not yet paid. |
| 10 | Loans & Borrowings | BS Bank Loans, BS Short-term Borrowings, BS Long-term Borrowings | Cr balances are liabilities. Interest-bearing loans included. |
| 11 | Provisions | BS Provision for Warranty, BS Provision for Legal Claims | Cr balances, estimated liabilities. |
| 12 | Tax Liabilities | BS Current Tax Payable, BS Deferred Tax Liabilities | Cr balances. Exclude amounts already recognized in P&L for the current period. |
| 13 | Share Capital | BS Share Capital | Cr balances represent equity invested by shareholders. |
| 14 | Retained Earnings | BS Retained Earnings | Cr balances, accumulated profits minus losses. Updated by P&L net profit/loss at period end. |
| 15 | Other Reserves | BS Other Reserves | Cr balances, e.g., statutory or revaluation reserves. |
Current Year Closing Balance - Displays the ending balances of accounts at the end of the current reporting period (e.g., December 31, 2024).
Previous Year Balance - Displays the account balances as of the same date in the prior year for comparison purposes.
Change (AED) - The difference between current year and previous year balances (Current – Previous).
Change (%) - The percentage increase or decrease compared to the previous year; not calculated if last year’s balance is zero.
On Date – Filter the report by a specific reporting date to show balances as of that period.
Entity – Filter by company or branch to generate the statement for the selected entity.
Show Details by GL Accounts – Filter to display balances at the individual General Ledger account level instead of summaries.
Show Changes in Statement Period – Filter to include comparative columns showing changes in amount (AED) and percentage versus the prior year.
Include Off-Balance Accounts – Filter to include normally excluded accounts.
Include P&L Accounts in Retained Earnings – Filter to update retained earnings by including Profit & Loss balances, primarily for year-end reporting.
