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Balancesheet preparation

CA STUDENT (Job) (73 Points)

05 April 2014

Hi Every one,

Please make me clear for the below query

As if i am preparing balance sheet , do i need to first complete Liabilities Details after that Assets back i hwhile filling values?

Is there any order like i need to fill this section first after that this one?

Long back i heard that ,first we have to fill Liabilities first,reason is that what your business owes to outsoders and after that Assets,what your business ownes and concluded that have to fill and complete liabilities first.

Waiting for reply with good explanation meaning.

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3 Replies

Mayank Mall (CA-Final) (316 Points)
Replied 05 April 2014

Well your idea behind the query is more of ethical than logical, uptill now I haven't studeied any such fact about Balance Sheet. However different people have different approach to the making of BS, like I go in order of the ledger accounts that is arranged in the trial balance. Whichever a/c i encounter, I place it in its place in the BS regardless of it being an asset or a liability.

I do have friends who first fill either side of the Balance Sheet then corresponding side, however not as a rule that the liability side has to be managed first.

Though, we do have groups in both sides which contain the ledger accounts, all we have to ensure while BS preparation is that these groups are properly maintained and all accounts are categorised in the requisite group only. Anyway do consult others as well, I could be wrong I guess.

CA STUDENT (Job) (73 Points)
Replied 06 April 2014

Hi Mayank,

I agree up to some extent but not completely

CA STUDENT (Job) (73 Points)
Replied 08 June 2016

Hi All,

Hi Mayank Gee, You have said " Ethical and Logical" when i have asked the same with the seniors, they replied that, if you are good at accounting concepts and convents what ever the question i have mentioned above is perfectly correct.

Accounting concepts and conventions are pillars based on these only accounting standards has built up...