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HomeHelp CenterBalance sheet explained
Reports & Analytics
6 min read
Updated March 1, 2025

Balance sheet explained

The balance sheet shows what your business owns (assets), what it owes (liabilities), and the owner's stake (equity) at a single point in time.

The accounting equation

Every balance sheet follows: Assets = Liabilities + Equity. If your balance sheet doesn't balance, there's an error somewhere in your books.

Key sections explained

  • Current Assets — Cash, receivables, inventory (convertible to cash within 1 year)
  • Fixed Assets — Equipment, vehicles, property (long-term assets)
  • Current Liabilities — Payables, short-term loans (due within 1 year)
  • Long-term Liabilities — Bank loans, mortgages (due beyond 1 year)
  • Owner's Equity — Capital invested + retained profits

Generating your balance sheet in Finova

1

Go to Reports → Balance Sheet.

2

Select the date — the balance sheet is always as of a specific date, not a period.

3

Optionally compare with a prior period (e.g., last year same date).

4

Click Generate. Export to PDF or Excel using the button at top right.

💡

Tip: Review your balance sheet at year end and share it with your accountant or bank. Lenders often require this document for loan applications.

⚠️

Note: If Assets ≠ Liabilities + Equity in your report, contact support immediately — it indicates a data entry error that needs to be traced and corrected.

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