Balance Sheet

A financial statement showing what a business owns and owes at a point in time: assets = liabilities + equity.

A balance sheet is a snapshot of a company's financial position on a specific date. It lists assets (what the business owns), liabilities (what it owes) and owners' equity.

It always balances on the accounting equation: Assets = Liabilities + Equity. Together with the profit & loss statement and cash flow statement, it shows the financial health of a business.

• Assets = Liabilities + Equity (always balances).
• Shows financial position at a single date.
• Used by owners, lenders and investors to judge solvency.