Balance Sheet

The Balance Sheet shows the assets, liabilities and capital of the company at a given point in time. You can use the Balance Sheet model supplied with FirstOffice, or you can define your own, possibly editing the standard definition to suit your needs.

Setting up a Balance Sheet

You can define the structure of the Balance Sheet to suit your requirements. The following example illustrates the set-up process.

To change the report definition of the Balance Sheet, first select 'Settings' from the File menu and double-click 'Report Settings' in the subsequent list. Then, highlight 'Balance Sheet' in the list on the left-hand side of the 'Report Settings' window and click the [Definition] button. The 'Definition of Balance Sheet: Browse' window is opened.

The window shows the Balance Sheet row by row, as it has been presented up to now. The rows are numbered 10, 50, etc., so there is room to insert new rows in between.

Double-click the first row, "10: Fixed Assets".

The 'Definition of Balance Sheet Definition: Inspect' window is opened with the current definition of the row.

The number identifies the row in the Balance Sheet, and the text "Fixed Assets" is printed in the report as a heading for a group of Accounts.

In the Accounts field a sequence of Account numbers has been entered. An alpha sort is used so, in the example illustration above, "600:69999" effectively means that all Accounts whose first digit is "6" are to be used.

Of the four Type options, "Accounts" has been selected to indicate that each of the Accounts in the number interval will be presented individually. After the last Account in the group, a total for the group will be printed.

The Account Type is "Asset". The Account Type concept is explained on the page describing the Accounts setting.

The Side and Active/Passive options are described on the Special Features of the Balance Sheet page.

The Accounts field consists of three rows, with room for a definition 300 characters long. As alternatives to specifying a range of Accounts, you can also specify a number of individual Accounts, or ranges of Accounts, separated by commas. If you enter a range of Accounts with the highest number first, the Accounts in that range will be presented in reverse order. For example, the sequence "605:601,626,651:655" will appear as follows in the printed report:

If you click the [Next Record] button (on the left-hand side of the Button Bar) or select 'Next' from the Record menu, the next definition row, number 25, "Cash in Hand & at Bank", is shown. This definition contains a range of Accounts : 700 to 739999. This row is of the type "Accounts", and of the "Asset" Account Type.

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If you move from record to record by clicking the [Next Record] or [Previous Record] buttons, remember that any changes you make will be saved. If you don't want to save the changes, you must use the close box, or click [Cancel].


Click forward to number 40, "Total Current Assets". Here the values of rows 25, 30 and 35 are added together, and the result is shown on line 40 with the heading "Total Current Assets". The Type is "Sum" and the Account Type is still "Asset".

In this way the Balance Sheet is designed, row by row.

When you have finished with the last row, if you want to save your changes, click [Save], or else close the window with the close box. Then, close the list of definitions using the close box once again.

The new Balance Sheet report is now ready to print.

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FirstOffice comes with a standard Chart of Accounts and a set of Report Definitions. This is a well-structured Chart, with systematic groupings of Accounts. It is suitable without any changes for most small or medium companies, but it is also easily modified by you or your financial adviser.


If you stay within the structure of the Chart (e.g. avoid putting Liability Accounts among the Assets!), there is no need to alter the definitions. But remember, it is a good idea to print a test Balance Sheet to see if your definitions produce exactly what you expect.

Setting up a Balance Sheet - Inserting a Row in the Balance Sheet

  1. Click the [Settings] button in the Master Control panel and double-click 'Report Settings' in the subsequent list. Then, highlight 'Balance Sheet' in the list on the left-hand side of the 'Report Settings' window and click the [Definition] button.

    The 'Definition of Balance Sheet: Browse' window is opened.

  2. Click [New] or highlight a row similar to the one you are creating and click [Duplicate].

    An empty form or a copy of the highlighted row is opened.

  3. Enter the information for the new row.

    Remember to give the new row a number that will insert it in the right place in the Balance Sheet. (If you want to insert a row between e.g. rows 30 and 40, you can use 35.)

  4. Click [Save] and close the window, or click the close box to cancel.

    You will now be brought back to the 'Definition of Balance Sheet: Browse' window, where the new row is shown in its proper place in the list.

Setting up a Balance Sheet - Deleting a Row from the Balance Sheet

  1. Click the [Settings] button in the Master Control panel and double-click 'Report Settings' in the subsequent list. Then, highlight 'Balance Sheet' in the list on the left-hand side of the 'Report Settings' window and click the [Definition] button.

    The 'Definition of Balance Sheet: Browse' window is opened.

  2. Double-click the row you want to remove, to show its definition window.

  3. Select 'Delete' from the Record menu.

    The row is deleted from the Balance Sheet and the definition for the following row is shown in its place.

  4. Close the window.

    You will be returned to the 'Definition of Balance Sheet: Browse' window.


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You cannot undo the deletion of a row in the Balance Sheet.

Printing a Balance Sheet

Click the [Reports] button in the Master Control panel and then double-click 'Balance Sheet' in the 'Reports' list. The 'Specify Balance Sheet' window is opened.

Period
Paste Special    Reporting Periods setting
Enter the period for the Balance Sheet you want to print. FirstOffice will suggest the first period in the Reporting Periods setting as a default.

Accounts
Select how you want the Accounts printed in the report.
All
This option will show all Accounts that have been included in the Balance Sheet definitions.

Used Only
This option will only show Accounts that have been used. This includes Accounts that have balances brought forward from a previous period but that have not been used in the report period.

Groups Only
This option does not show balances for individual Accounts. Instead, it simply shows an overall balance for each row as entered in the Balance Sheet definitions.

Used Groups Only
This option only shows balances for rows as entered in the Balance Sheet definitions that have been used.
Comparison
Choose to compare with Net Change or the Previous Year.

List Transaction Nos
With this box checked, the Transaction Numbers of all Transactions that fall within the reporting period, together with debit and credit totals, will be listed at the bottom of the report.
When you click [Run], the Balance Sheet is printed as you have specified it.

When printed to screen, the Balance Sheet has FirstOffice's Drill-down feature. Click on the Account Number of any Account in the report to open the Nominal Ledger Report for the same Account and period. From the Nominal Ledger report, you can click on any Transaction Number to open an individual Transaction record.

Special Features of the Balance Sheet

This page has no relevance for those companies that practise standard western accounting conventions.

In the Balance Sheet definition, there are two groups of options that need a special mention. This design has been made in order to facilitate certain accounting and reporting requirements in various countries. The easiest way to explain the usefulness of these facilities is with the help of an example. In most companies, there are a number of reconciliation or suspense accounts, either assets or liabilities, which alternately can hold debit or credit balances. The accounting conventions of some countries only allow "pure" debit or credit accounts, and when a balance sheet is produced, it becomes necessary to move individual accounts back and forth between the active or the passive groups, depending on the current positive or negative balance.

To complicate things even further, in some countries it is customary to distinguish between four different "states" of a book entry: Debit+, Debit-, Credit+ and Credit-. In modern western accounting systems, a book entry is either debit or credit, regardless of the class of the account, i.e. we have a simple arithmetic definition of balances.

In those environments where all these special rules are used, the preparation of balance reports tends to become complicated and labour consuming. These special functions of FirstOffice allow the far-reaching automation of many of these routine tasks. This is how it works.

Let us start with the following Nominal Ledger report, showing the actual debit and credit balances for two Accounts.

Account 702 - Bank Current Account 2:

Account 703 - Advances and Settlements 3:

Account no. 703 is defined as an asset, and currently has a balance in credit. Total Debits during the period is 15, and total Credits 1000. Account no. 702 has a normal debit balance, but on this account two negative values have been entered, one in debit and one in credit. If the Accounts are used in a report definition in the normal way, with the buttons Side:Normal and Active/Passive:Normal selected, the balance of Account no 703 will be shown as a negative asset value.

With the buttons Side:Debit and Active/Passive:Only Debit options selected, the debit column total for Account 702 will be shown, because the Account balance is in debit:

With Side:Credit and Active/Passive:Only Credit selected, the balances from both the Accounts' credit columns will be shown, because both are negative.

With Side:Credit and Active/Passive:Only Debit selected, nothing will be shown, because the credit column of Account 702 has a positive value, and 703 has an overall debit balance.

With Side:Debit and Active/Passive:Only Credit selected, once again nothing will be shown.

The combination Side:Credit and Active/Passive:Normal shows the credit column balances for both Accounts: