There is such a focus from owner managers on the income statement of the business that all too often the balance sheet is neglected.
The balance sheet is a statement of a company’s assets, liabilities and capital at a specific point in time and the accuracy of it ensures owners have a clear view of their financial position.
Balance sheet account reconciliations should be carried out at the end of a period, usually either monthly, quarterly or annually, both to the books and records of the company and to external third party evidence to make sure they are correct. If the balance sheet is not correct, it could result in management making decisions based on incorrect information which could result in a financial loss.
Performing monthly balance sheet reconciliations can help identify problems such as incorrect accounting or fraud and is crucial to understanding and evaluating the financial position of your business.
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