The balance sheet currency is the economic liabilities that any organization has at the reporting date. First of all, economic obligations arise to persons who have an economic interest in the affairs of the organization.

The balance sheet currency is responsible for the correspondence of the active and passive parts of the economic resources that the enterprise currently has to the total volume of real financial resources allocated by creditors and owners. Capital and the passive part of the balance sheet are distinguished by the nature of obligations to third parties and owners, the urgency of payments and the procedure for repayment.

Unfortunately, the balance sheet currency is not a real reflection of the funds available to the organization. The reason for this is the value of assets that does not coincide with the real market value.

In order for the balance sheet currency to have a real definition, it is necessary to fill out the appropriate accounting forms. From them we can draw a conclusion about the reality of the assets. The clearest picture is presented after filling out the profit and loss statement in reporting form No. 2.

When analyzing financial statements, the emphasis is on the scope of activity of the proposed borrower. Therefore, for a generalized analysis, it is necessary to review the balance sheet items that are directly related to its main activities. It would also be useful to analyze receivables and payables by their structure and quality.

When monitoring financial statements, it is necessary to evaluate its structure. There is no doubt that the balance sheet currency allows this to be done according to the data. The next step in creating a complete picture of a potential borrower is the calculation of coefficients that will characterize its main indicators of financial stability, business activity, liquidity, profitability and subsequent profitability. If necessary, an analysis of other indicators characteristic of the potential borrower’s field of activity is also carried out.

Any enterprise or organization can increase its balance sheet currency. There are different operations in different industries that will help increase this indicator.

For example, currency can be increased due to an increase in deposit funds in bank accounts and the number of loans issued. This indicator can also be increased by increasing the authorized capital, which will be responsible for the liability, and an increase in the number of loans issued or investments in various securities will correspond to the asset.

Each type of funds, both in assets and liabilities, is one of the balance sheet items. To calculate the total, you will need to compare the balance sheet assets at the beginning of the year and at the end. The data obtained will be equal to the total liability. This is how the balance sheet currency is displayed - this is its total value. And equality of outcome will be critical. This is a way to check accounts to detect unintentional errors. Therefore, everything carried out by the enterprise has a direct impact on the balance sheet currency. They can lead to both an increase in the value of the liability and the asset. In rare cases, changes to items occur simultaneously. Therefore, when there is a question of increasing the balance sheet currency, this must be done through the following operations:

movements - they contribute to changes within the balance sheet asset;

changing the intended purpose due to changes in the liabilities side of the balance sheet;

investments, due to which the overall results change - they increase in both assets and liabilities;

withdrawals - occurs due to a downward change in the total liabilities and assets of the balance sheet.

In these operations carried out at the enterprise, it should be taken into account that the liabilities and assets of the balance sheet will ultimately consist of the total amount of all the articles representing them and each of them has its own code, reflected in the standard reporting. When filling out articles, you can choose the best way to solve the problem to increase the balance sheet currency.

The balance sheet currency is the total amount of the asset, as well as the total amount of the liability of the balance sheet in the accounting department of an enterprise or organization. The prerequisite is that both of these amounts must be the same. In other words, such a balance sheet total shows the approximate amount of all funds owned by the organization. We emphasize that this is approximate, since the book value of individual assets may differ radically from their market value.

“We can also say that the currency (or figure) of the balance sheet is the total volume of economic obligations that a particular enterprise has as of the reporting date in relation to all legal entities and individuals having an economic interest in its activities.”

Increasing balance currency

It happens that the balance sheet currency may change positively (increase) or negatively (decrease). There are several reasons that cause an increase in the balance sheet currency. In particular, these may be:

• increase in overall production volumes at the enterprise,
• increase in terms of settlements with debtors,
• receipt from the bank,
• revaluation of fixed assets of the enterprise, etc.

In some cases, an increase in the currency (figure) balance can provoke inflationary mechanisms.

“In addition, the opposite process is possible - a decrease in the balance sheet currency, usually caused by a decrease in business activity and, in fact, being a decrease in the solvency of the company.”

Balance currency: formula

• The increase in the balance sheet currency of the enterprise is carried out according to the following formula:

• In turn, the decrease in the balance sheet currency is calculated using the formula:

It is important to remember that an increase or decrease implies a simultaneous (and, very important, equal) increase/decrease in assets and liabilities.

Foreign currency balance

A legal entity may have financial reserves in the currencies of other countries on its own balance sheet. In particular, these include:

• cash in the form of currency at the cash desk ("Cashier" account, sub-account),
• money placed in foreign currency accounts with authorized credit institutions (account “Currency accounts”),
• foreign currency funds placed on deposit accounts, letters of credit and other financial instruments (account “Special accounts in banks”, sub-account).

In addition, the balance sheet of the enterprise takes into account such foreign currency finances that were collected or deposited into bank accounts for settlements with creditors, but were not posted at the time of the accounting date (the “Transfers in transit” account, sub-account).

Own capital: balance sheet currency

In addition, accounting uses the concept of equity. It refers to the section of the enterprise’s balance sheet, which represents the sum of the authorized, reserve, and additional capital. In addition, the legal entity’s equity includes targeted financing and retained earnings.

Changes in equity capital (regardless of whether it is an increase or decrease) in most cases lead to an automatic change in the balance sheet currency of the enterprise.

Does the balance sheet currency depend on the type of activity of the enterprise?

To understand whether the balance sheet currency depends on the type of activity of the enterprise, and how much it depends, you should look at today's enterprises and compare different areas. For example, the difference is clearly visible between the manufacturing sector and the service sector. In the first case, a large number of non-current assets - real estate, transport, machinery and raw materials - creates a higher balance sheet currency, while in the service sector there are practically no non-current assets. No need to maintain a fleet of machines or purchase large quantities of industrial raw materials significantly reduces the average balance sheet currency.

Balance currency in asset

In the assets section of the balance sheet currency, it is customary to include all components of the balance sheet, indicating their value at the time of drawing up such a balance sheet. This may include tangible assets (enterprise property), fixed assets and inventories, organization accounts, finished goods and work in progress. Also taken into account are cash and monetary securities that currently belong to the organization and have some value. This also includes receivables to the organization from other organizations. The asset summarizes the so-called “fair” value of the farm.

Balance sheet currency in liabilities

The list of positions by balance sheet currency in liabilities includes various sources of income that currently affect the final profit of the farm or enterprise. Typically this includes accounts payable (to partners, customers, suppliers), profits received in the past, authorized capital and borrowed funds. Accounts payable, among other things, include debt to the state in the form of unpaid taxes. In fact, in the list of balance sheet currency in liabilities, the total cost of items is equal to the balance sheet currency in assets; only the method of calculating the total cost of the economy changes.

Changing the balance currency

Any change in the balance sheet currency, whether negative or positive, is always the result of the enterprise’s activities. In case of a positive change, we can talk about expanding the enterprise, obtaining new assets, and revaluing fixed assets. Other reasons include an increase in the period for payment or repayment of debts, inflation. That is, everything that concerns the increase in total assets in the farm is recorded here. The change can also be negative, and then we can talk about a reduction in demand or opportunities for purchasing raw materials. The decrease is often associated with the inclusion of new subsidiaries into the general economy.

What does the balance currency provide?

You can find out what the balance sheet currency gives by comparing the assets and liabilities of the farm, including over a long distance. Calculating the balance sheet currency allows you to conduct an accurate analysis of profits and losses, see the income items that best expand the assets of the farm without negative consequences. It is the comparison of liability and asset items on the balance sheet that often gives an accurate picture of development dynamics. Based on the analysis of these articles, you can not only determine the unprofitability or profitability of the enterprise as a whole, but also find strategies for development in the coming months or years.

Instructions

Enter the data in section 1 of the Balance Sheet, which is devoted to non-current assets. It contains information on balances of intangible assets (line 110), fixed assets (line 120), construction in progress (line 130), profitable investments in tangible assets (line 135), long-term financial assets (line 140), deferred financial assets (line 145) and other non-current assets (line 150). In this case, the calculation is carried out according to the debit and credit of the corresponding accounts at the beginning and end of the reporting period, taking into account depreciation charges. Summarize the total for section 1 and enter the resulting value in line 190.

Fill out section 2 “Current assets”, which contains information on the balances of inventories, raw materials, materials, products, goods, expenses, cash, accounts receivable and other data at the beginning and end of the reporting period. Calculate the sum of balances on lines 210-270 and enter the resulting value in line 290.

Calculate the balance sheet currency of the enterprise based on the assets and enter its value in line 300 of the financial statements. To do this, you need to sum the values ​​of line 190 and line 290.

Check the accuracy of the calculations by filling out the liability part of the balance. Complete section 3 “Capital and reserves”, section 4 “Advance liabilities”, section 5 “Short-term liabilities”. Add up the appropriate totals for the sections and enter the resulting amounts in lines 490, 590 and 690.

Sum up the resulting values ​​and enter them in line 700, which should coincide with the amount indicated in line 300. Otherwise, check the entered data in the reporting and correct errors. Equality of the amounts will indicate that the calculation of the balance sheet currency was performed correctly.

Video on the topic

Determining the balance sheet currency allows you to characterize the volume of economic obligations of the enterprise that arose as of the reporting date. This indicator is the monetary expression of the financial and property status of the company and is determined on the basis of the balance sheet.

Instructions

Enter the data into the balance sheet using the accounting accounts. To prepare the indicators, take the difference between the corresponding accounts at the beginning and end of the reporting period, minus depreciation charges, if any. If the balance is positive, then the value is entered as a credit to the table, and if it is negative, then as a debit.

Fill out the active part of the balance sheet. Section 1 “Non-current assets” contains information on the balances of all assets of the enterprise that have a useful life of more than one year, including fixed assets, intangible assets and other long-term indicators.

Enter the total for this section in line 190 of the balance sheet. In section 2 “Current assets”, enter the balance of assets that were consumed or converted into money during the year. These include: accounts receivable, deferred expenses, inventory, etc. The total for it is entered in line 290. After this, lines 190 and 290 are summed up and the value is entered in line 300.

Calculate and enter data into the liability side of the balance sheet. To do this, fill in: section 1 “Capital and reserves” with the corresponding values ​​​​for retained earnings, authorized and reserve capital, etc.; section 2 “Long-term liabilities” and section 3 “Short-term liabilities”, characterizing loans, borrowings and other debts of the enterprise. Summarize the corresponding totals in lines 490, 590 and 690. Enter the total for the liability in line 700.

Compare the values ​​of line 300 and line 700. If they are equal, then the balance sheet is drawn up correctly and this value is recognized as its currency. Otherwise, recheck all reporting lines to identify any error or inaccuracy.

People involved in accounting know that all their activities are based on working with assets and liabilities. What are these two components?

An asset in accounting is the first and second parts of the balance sheet. The set of results collected in a single list in the form of a table with two sides is called a balance sheet.

This table shows the number of household assets and their key of formation in monetary value for a certain period. On the active accounts of the accounting department, the available funds are visible, and the balance on the active account shows how the funds are distributed, that is, where they are directed.

In passive accounts, the sources of formation of economic funds are visible. Balances in passive accounts show how the funds came into being. You definitely need to remember that in accounting, assets and liabilities are the same money, only divided into different groups. This means that the sum of assets will always be equal to the sum of liabilities. The entire amount of assets (or liabilities) is the “balance sheet currency,” but this term has nothing to do with the currencies of other countries and serves only to determine the volume of economic activity of a particular company. At any time, by looking at, you can get information about her financial situation. It also shows the organization’s assets on the day the balance sheet was drawn up. The balance sheet has two parts. In the first part, property is presented broken down into cells of formation - these are liabilities, and in the second part, property is presented by type, arrangement and number of elements - these are assets.

Some people believe that accounting is very complicated and confusing. To some extent, this is true, because a large part of the accounting profession consists of complex instructions about which specific accounting accounts and in what sequence it is necessary to record any work.

Sources:

• accounting asset liability

Tip 4: General concepts about the balance sheet: assets, liabilities, balance sheet currency

The balance sheet is a method that allows you to summarize and group the assets of a business entity and the sources of their formation as of a certain date. The balance sheet helps to determine: what are the assets of the enterprise that it may currently have, what sources were their basis, for what purposes they are intended and spent. All this information is reflected in the balance sheet.

Balance sheet data is used not only for financial and accounting reporting of the enterprise. This document is a source of valuable information and parameters for the proper management of financial flows and the very structures of its assets and liabilities. Today, without the data on the balance sheet, it is impossible for the management of an enterprise to act, which, on the basis of accurate financial and accounting information, develops a strategy for the development and functioning of the enterprise. Knowledge of the balance sheet is indispensable for financiers, those involved in investment programs, control, lending, etc. The ability to read a balance sheet is now an essential skill for senior managers who are involved in making important management decisions.

To keep the scales accurate

The word “balance sheet” itself is translated from French as “scales,” which determines the purpose and functions of this financial document. Graphically and structurally, it is a statement presented in a two-sided table. Its left side displays what assets are available and what sources formed them. Information about the enterprise’s property, which is grouped by type, is also posted here. All this data is called balance sheet assets. The balance sheet liability is reflected on the right side of such a statement; it contains information about the sources that were the basis for the formation of this property. Drawing up and correctly maintaining a balance requires that the sum of its right and left sides should always be equal. That is, there must be an equal sign between asset and liability.

The asset is always equal to the liability

The very concept of assets includes resources controlled by the enterprise based on past events. The use of these resources is expected to provide economic benefits in the future. For example, in order to be listed as an asset, resources must be controlled by the enterprise (one option is that it must own it as property). And property brings some benefit in the future.

Liabilities reflect the sources from which assets originate. Based on the amount and structure of liabilities, it is determined whether the enterprise received its assets using its own capital, or whether the liabilities were formed due to the fact that the enterprise had any obligations.

The total amount of the asset (or liability) is called the balance sheet currency. Sometimes this term is replaced by a balance sheet figure.

Balance currency- this is the total amount for an asset or liability on the balance sheet. This amount is the same for assets and liabilities due to double entry.

Changing the balance currency

Analysis of changes in balance sheet currency is carried out in the FinEkAnalysis program in the block Analysis of balance sheet liquidity.

A change in the balance sheet currency indicates both positive and negative results of the enterprise.

Increasing balance currency will be called:

• expansion of production volumes;
• revaluation of fixed assets;
• inflationary processes (the cost of inventories increases unjustifiably as purchases are made at higher and higher prices);
• extension of terms for settlements with debtors, etc.

It is necessary to consider in detail all the reasons for the increase in the balance sheet currency in order to get an idea of ​​​​the state of the enterprise's funds.

Decrease in balance currency caused by a decrease in business activity (economic turnover) of the enterprise, which, in turn, is caused by:

• reduction in the effective demand of buyers;
• restriction of access to commodity markets;
• inclusion of subsidiaries and dependent enterprises in the economic turnover.

A decrease in the balance sheet currency is equated to a decrease in the solvency of the enterprise.

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In this article we will consider in detail the concept of balance sheet currency and how it is calculated. Each enterprise in the Russian Federation is required to keep accounting records; accordingly, it is necessary to draw up a balance sheet that will reflect the financial and economic activities of this enterprise. The balance sheet reflects all transactions carried out by the company.

General concept of balance sheet currency

Drawing up a balance sheet is necessary to control obligations assumed and funds received.

Important!!! In the course of financial and economic activities, the balance sheet currency may change, both for the better for the enterprise and for the worse.

Let's look at the main reasons why the balance sheet total may change. The main reasons that lead to changes in the balance include the following:

But there are also reasons that reduce the balance sheet; this, unfortunately, leads to negative processes in the activity of the enterprise.

• Inflation;

As we understand from the information presented above, the balance sheet currency reflects the activities of the organization, and without fail, the amount of items on an asset must be equal to the amount of items on a liability.

For a more detailed understanding, let us present in the form of a table what information is reflected in the assets of the balance sheet and what in the liabilities, and as we have already noted, the data of these items should be equal to each other.

Calculation of balance currency

• Increasing the balance amount –

• Reducing the balance amount –

Calculating the final balance amount is not particularly difficult; it is important that all transactions are posted and not re-entered, since some amounts may contain two or more transaction amounts. The accountant needs to add up all the amounts for each item in the asset and also need to make a calculation in the liability; if all transactions are posted correctly, then the amounts of the asset and liability will be equal to each other.

It is important that the accounting employee kept records of all operations that occur in the enterprise, because they are directly related to the formation of the final balance sheet amounts. In order for the equality of assets and liabilities to be observed, it is necessary to carefully post all transactions that were carried out at the time of drawing up the balance sheet.

The main feature of the balance sheet currency is that with the help of this indicator it is possible to conduct a detailed analysis of which of the balance sheet items brings the greatest income, and which, on the contrary, negatively affects the activities of the enterprise. Using the total amount, you can prevent the deterioration of the enterprise's performance in future periods.

Based on this article, we can conclude that drawing up a balance sheet is a necessary requirement in every enterprise. With the help of the correct allocation of transactions to balance sheet items, a final amount is formed that characterizes the activities of the enterprise, whether this organization is working in a positive direction or is striving for closure. By analyzing each article, you can make an accurate conclusion about the activities of the enterprise, what can be changed for the better or what to pay special attention to, which in the future can lead to an increase in turnover.

Frequently Asked Questions

Question No. 1.

What is meant by the concept of balance sheet currency?

Answer: The balance sheet currency is considered to be the total amounts for the assets and liabilities of the balance sheet; these amounts must be equal. The balance sheet of an enterprise reflects the financial and economic activities of the organization, what obligations were assumed in the reporting period and what amounts were received during the sale of goods or services. The preparation of the balance sheet at the enterprise is carried out by an accounting employee who keeps full records.

Question No. 2

What reasons contribute to an increase in the total balance sheet?

Answer: The main reasons that lead to changes in the balance include the following:

• Increase in production volumes;
• Obtaining additional obligations;
• The company's assets were revalued;

These reasons contribute to an increase in the balance sheet; this is a positive process for the enterprise. Profits increase and, accordingly, the company has more funds and can afford to expand its activities.

Question #3

What causes the balance to decrease?

Answer: The main reasons that contribute to a decrease in the balance sheet currency:

• Inflation;
• Decrease in demand in the production market;
• Increase in the purchase cost of raw materials.
• Lack of funds to purchase raw materials.

Since this is a negative process for the activities of the enterprise, the consequences of this process can be difficult for the further activities of the enterprise.

Question No. 4

How is the balance currency calculated?

• Increasing the balance amount –

Asset + Change Amounts = Liability + Change Amounts;

• Reducing the balance amount –

Asset - Change Amounts = Liability - Change Amounts;

This formula confirms the relationship between the asset and liability of the balance sheet, that is, if the balance sheet amount for the asset increases, the balance sheet amount for the liability must increase accordingly. The same method is used when reducing the value of the balance sheet.