Balance Sheet(BS)

• A statement of your position
• A statement that records Assets and Liability is called Balance sheet
• From business start till present.
  • Balance Sheet as on 31st March 2020
  • i.e statement from start till March 2020

Assets

• Anything that you own

Type 1

Non-current Asset

• All long term asset (>1yrs)
• Property, Plants, and Equipment
• Goodwill
• Intangible Asset
  • Any asset which you can’t touch
  • Eg: copyright, trademark, software
• Financial Asset
• Other non-current assets

Current Asset

• All short term asset (<1yrs)
• Inventories
  • Traded Goods
  • Raw Materials & Packing Materials
  • Finished Goods
  • Spares
• Financial Asset
• Other current assset

Type 2

• Appreciating assets
  • Gold
  • Cash
  • RealStates
• Depreciating assets
  • Large Machineries
  • Steel Plants
  • Cement Plants

Liability

• Anything that you owe
• Source of funds(Paisa kaha se aaya)
  • Equity, debt, bonds issue, etc..
• In BS you will see Equity and Liabilities

Equity

Equity Share Capital

• Money taken from shareholders and invested in the company

Other Equity

• Profit retained every yr will add up here
• Realised profit
  • Retained Earning(Cumulative bal of P&L a/c)
    • RE 2020 = RE 2019 + PAT 2020 - Divident 2020 +- other
  • General/Revenue Reserve
• Un-realised profit
  • Capital Reserve
  • Cash subsidy reserve
  • …

Liability

Non-Current liability

• Need to settle after 12 months
• Financial liability (pay Cash)
• Other Non-current liability (pay Obligation or Goods )
• Provision
  • Liability based on estimation
  • Compensated Absent
  • Anniversary Award
  • Premature death pension scheme
• Deferred Tax liability(net)
  • Two sets of Income Books are made
    • Income by Income-tax – Based of Payment
    • Income by Accounts(Company) – Based on Approval
  • Eg: Bonus – Paid next yr, but approved this yr
    • If there is a difference in taxation in these two years
    • then there will be different tax payable.
  • Net Deferred Tax – Can be either Asset or Liability

Current liability

• Need to settle within 12 months
• Financial liability
• Other Current liability
• Provision
• Current Tax Liabilities(net)
  • Self assessment tax
  • Re-check (By income tax)
    • Maybe same as self assessment
    • Or can be more