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Overview

The Balance Sheet provides a snapshot of a Business’s financial position at a given point in time, summarizing what the Business owns (assets), what it owes (liabilities), and the owner’s interest in the company (equity).

The Balance Sheet is based on the fundamental accounting equation:

Assets=Liabilities+Equity\textit{Assets} = \textit{Liabilities} + \textit{Equity}

Key components:

  • Assets – Resources owned by the Business, such as cash, receivables, and equipment.
  • Liabilities – Obligations owed to others, such as loans and unpaid bills.
  • Equity – The Business’s net worth after liabilities are deducted from assets.

The Balance Sheet helps Businesses assess financial stability and creditworthiness.

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How to Generate a Balance Sheet

  1. Call the Retrieve the Balance Sheet Report endpoint with:
    • Business ID
    • Simple Date or Timestamp
  2. Display the data using the following structure (backed by customer research for clarity):

    • Assets

      • Current Assets (e.g., cash, accounts receivable, inventory)
      • Non-Current Assets (e.g., equipment, long-term investments)
      • Total Assets

    • Liabilities

      • Current Liabilities (e.g., accounts payable, short-term loans)

      • Non-Current Liabilities (e.g., long-term loans, deferred revenue)

      • Total Liabilities

    • Equity

      • Retained Earnings

      • Owner’s Equity / Shareholder Equity

      • Total Equity

Since the Balance Sheet is a snapshot in time, all values should reflect the financial position at the specified report date

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Balance Sheet Best Practices

  • Handling Report Dates Accurately – The Balance Sheet reflects a single moment in time, which can cause confusion if not communicated properly. When requesting a Balance Sheet, you can pass either:

    • A date → Asset will return the Balance Sheet as of 23:59:59 EST on that date.
    • A full timestamp → Recommended for high-transaction-volume Businesses to align reporting with local time zones. Clearly indicate to users that the Balance Sheet represents a fixed point in time.

  • Enable Ledger Drill-Downs – Users may need to investigate specific balances. Use the Ledger Statement report to provide transaction-level details.

  • Set Opening Balances Correctly – When creating a Linked Account, ensure the Opening Balance is accurate. Asset uses this as the starting point for running balances in the Balance Sheet. An incorrect Opening Balance will lead to misstated financials.

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