The balance sheet is one of the main forms (form No. 1) of the annual reporting of enterprises. It must be compiled by all organizations that are on the common taxation system. Visually, it is a table that reflects the sources of funds: own and borrowed (liabilities), as well as directions of use (asset).
The organization's balance sheet is necessary not only for tax authorities and external auditors, but, first of all, for the company itself. Using it, you can assess the state of affairs of the enterprise and, based on the analysis of the information received, develop measures to improve the condition and determine development directions. The passive consists of three large sections:
1. Capital and reserves. The amount originally invested by the owners of the enterprise is the authorized capital. In the process of development, it can increase in size, thereby increasing the level of reliability of the company for lenders and attractiveness for potential investors. The section also contains other sources of property formation (additional and reserve capital) and the amount of
retained earnings reflecting the financial independence of the enterprise.
2. Long-term financial liabilities. It contains information on long-term loans attracted by the organization, as well as on deferred tax liabilities.
3. Short-term obligations are obligations that have been undertaken in order to ensure stable and uninterrupted work, and maintain current solvency.
The balance sheet is a tool for determining the level of independence, independence of the enterprise. The higher the share in the balance of
borrowed funds, the lower the coefficient of autonomy.
The balance sheet of the company, or rather the active part of it, shows how the company manages its available funds:
1. Non-current assets. The section contains information on long-term investments, the amount of fixed assets and available intellectual property.
2.
Current assets. The section reflects the amount of available stocks, as well as cash (in the form of money at the cash desk and on settlement accounts, as well as debt of buyers).
Thus, the balance sheet is the main source of information about the property reserves of the enterprise and its solvency, which is very important for potential lenders.
The structure of the active part of this reporting company allows you to assess the level of investment in fixed assets, prospects and the scope of technical, intellectual development. The structure of working capital shows how effective the relationship of the company with debtors is, its level of liquidity, the degree of congestion in warehouses and the efficient use of free cash.
The balance sheet is the main source of information for the analysis of the state of the enterprise. For a deeper assessment and development of a development strategy, it is advisable to study the accounting analysis in dynamics to determine the main negative or positive trends. This will clearly identify the management of the enterprise the sources of existing problems and will help in the future to more effectively manage the property at its disposal.