01 June 2014
A Balance Sheet depicts the details of capital inflow and outflow of the organization. The Statement of affairs is similar to the balance sheet however, the diffrence is of the preparor. Balance sheet is prepared under the double entry system, whereas, the statement of affairs is prepared under the single entry system by the non-profit entities.
Further, the authenticity of the balance sheet can be traced from the books maintaiined by the preparor however, in a statement of affairs it is difficult to measure the authenticity as the same owning to single entry system followed by the entities.
Also, balance sheet takes into consideration the profit or loss earned by the entity over a period while calculating the portion of retained earning and deciding the dividend payments. In case of statement of affairs, the excess of income over expenditure or vice versa is considered. The organizations preparing a ststement of affairs can be contractors for indivdual contracts, trusts governing the assets of the beneficiaries, etc.