• Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Shuriken Consulting

beyond the numbers

  • Pay your Bill
  • Tax Calculator
  • Contact Us
  • About
    • Privacy
  • Webinars
    • ATO Targets Cash Business
  • Services
    • Setup
    • Company Setup
    • Education
    • Finance
    • Insurance
    • Compliance
    • Bookkeeping
    • Tax and Accounting
    • Cloud Accounting
    • SMSF
    • Growth
    • Advice
    • Business Structure
    • Business Valuations
    • Wealth Team
  • Digital
  • International
  • Locations
    • Sydney CBD
    • Hornsby
    • Dural
    • Manly

Andrew Jeffers CEO / October 25, 2017

What Is A Balance Sheet?

Profit, loss, cash flow… we’re all familiar with these terms. But the balance sheet is the ugly thing nobody wants to talk about.

But guess what? That’s exactly what we’re going to talk about today.

Let’s rip off the band-aid and get right into it.

What is a balance sheet?

Your balance sheet is a record that contains information about:

  • Who owes you money
  • Who you owe money to
  • What’s left after you paid the owed money

If it’s up to date, it can give you an accurate snapshot of your financial situation.

You can access it at any time but in order to understand your business’ financial position, you need to know how to decipher it.

How to look at your balance sheet
  • Examine your assets including money people might owe you. The key asset for your business is: How much money is coming in?
  • Identify your liabilities: Who do you owe money to? It could be the ATO or the bank.
  • Analyse your equity or shared capital: What‘s your leftover? How much profit did you make?

All these elements will indicate your financial stability.

You might also be interested in: What Is A Shareholders’ Agreement And Why Do You Need It?

Balance sheet reconciliation is a must

When I see a new client, 9 times out of 10, their balance sheet items haven’t been reconciled.

What does it mean?

It means I’ve got third-party pieces of information.

For example, if I take a look at my client’s bank statements and compare those numbers with my accounts, they should match. Otherwise, I have unreliable information to work with.

How can you do a financial evaluation of a business if the information you have is inaccurate?

Tip: Make sure your balance sheet items are reconciled every month. Good financial reporting should be done monthly.

[ctt template=”7″ link=”Od04f” via=”no” ]Tip: Make sure your balance sheet items are reconciled every month. Good financial reporting should be done monthly.[/ctt]

Don’t do it alone, this isn’t a one-man job. Work with your accountant on this. They are the number crunching expert. If you’re not getting accurate information from your accountant, consider looking for someone else.

At the end of the day, the financial viability of your business is your responsibility. You’re the driver!

Let’s reconcile your balance sheet!

Whether you need someone who can do the number crunching for you, or you need business advice from an expert, the amazing team at Shuriken Consulting and I are here to give you a helping hand. We’d love to hear from you! Let’s get in touch:

contact-shuriken-today

Filed Under: Andrew Jeffers, Best Practice Tagged With: 2 minute accountant, Andrew Jeffers, balance sheet

Primary Sidebar

Recent Posts

  • August 2021 Tax And Accounting News: All You Need To Know
  • Exclusive Probians Offer
  • Tax & Accounting Questions Answered Free for Probians
  • Government support for your business
  • Succession Planning for Small Businesses

B1G1

“Imagine if every time you made a step forward in your business, it had an unimaginable impact on the lives of others…”

Footer

Services

  • Company Setup
  • Education
  • Finance
  • Insurance
  • Bookkeeping
  • Tax and Accounting
  • Cloud Accounting
  • SMSF
  • Advice
  • Business Structure
  • Wealth Management
  • Business Valuations
  • Digital Marketing
  • Shuriken International
  • Events

About

Shuriken is at the forefront of accountancy, providing clients with a broad range of services, coaching and mentoring.

Contact Shuriken if you want to launch or grow a business or if you want to get a clear action plan on how to achieve your financial goals. We can help with benchmarking, cashflow forecasting, payroll and much more.

Learn More

NSW Business Chamber Member

Contact Us

Sydney CBD

T: 1300 886 066 or (02) 9114 8544

Hornsby

T: (02) 9485 3400

Dural

T: (02) 9651 2288

Endorsal

  • News
  • Events
  • FAQs
  • Contact Us
Terms of Use Privacy Policy Disclaimer