What is a Balance Sheet Report?
A Balance Sheet is a snapshot of your business’ financial position on a given day, usually calculated at the end of the quarter or year. Balance Sheets are also useful in summarizing your business’ assets, liabilities and owner’s equity (also known as shareholders’ equity).
The way your finances balance is as follows: Assets = Liabilities + Owner’s Equity. When everything balances, all your finances have been accounted for.
Access the Balance Sheet
To access your Balance Sheet, use these steps:
- Click on the Accounting section
- Select Balance Sheet under Accounting Reports.
To adjust your view of the Balance Sheet Report, click on Filters under Settings. From there, you can change:
- Reset all - Click on this link to restore the filters back to the default settings
- Balance Date - Choose from Custom, Today, End of Last Month, or End of Last Quarter (note that Jan 1, 2018 is the earliest date we can retrieve data from currently for Balance Sheets in Beta) - if you’ve changed your Fiscal Year End date, you can also choose from the extra options
- Compare Dates - Check this box off and ensure you have a Start Date and End Date to compare with
- Currency - Toggle between multiple currencies
- Clicking More Actions in the top right will give you the option to Export for Excel, or Print your Report
- The Balance Sheet shows balances for Parent Accounts only, export the Balance Sheet as a CSV to see more details
- To view Account balances, you can also use the Chart of Accounts instead
- When comparing the Balance Sheet balances of asset, liability, and equity accounts on the Chart of Accounts, be sure to set the date range to start from the date of the first transaction in your business
An asset is anything tangible or intangible that your business owns or controls and produces value in some way. Assets can include anything like:
- Accounts Receivable - Any outstanding invoices and payments
- Equipment - Any tangible items of value that are business-related purchases
- Inventory - Goods and materials that your business holds for purpose of resale (doesn’t count any items you’ve sold, and Inventory Tracking is not reflected here)
- Cash - Any funds your business has direct access to (includes cash and funds in bank accounts)
- Reimbursable Expenses - Any expenses purchased that will be reimbursed by another party
Liabilities are funds that your business owes. Liabilities can include anything like:
- Accounts Payable - Any money that you owe for reasons other than a loan (like an unpaid invoice or Bill)
- Current Loans Payable - The total value of any loans that you haven’t paid back yet
- Customer Credit - Any available credit remaining for any of your clients
- Credit Cards - The amount of your business’ unpaid credit card debt
- Taxes Payable - Taxes that you owe the government
- Unearned Revenue - Amount of prepaid revenue, like deposits
Known as Owner’s Equity or Shareholders’ Equity, this is what you put in or take out of a business, and represents assets that remain after deducting liabilities. Equity can include anything like:
- Owner’s Equity - Amount invested into the business by the owner
- Common Stock - Value of the business’ stock
- Retained Earnings - Income retained by the business rather than distributed to the owner(s) as dividends
Why are my balances incorrect?
First, check that the date you’ve selected is correct in the Balance Sheet's Filters, this is the Balance Sheet’s as of date.
The Balance Sheet in FreshBooks shows a cumulative balance for all accounts. This means that all transactions up to the date selected, starting from the first transaction recorded in your FreshBooks account, is included in the balance shown on the Report. The only exception is if your Balance Sheet is still in Beta, in which case all transactions starting from January 1, 2018 will be included.
Since the balances carry forward each period, you can use the Compare Dates option in the Filters to see changes in balances between two different dates.
If you’ve checked that the date range in the Filters are correct, you can look into the details of each balance by using other Accounting reports like the Chart of Accounts, General Ledger, or Trial Balance instead.
Why does my Net Income on the Balance Sheet not match the Net Profit on my Profit & Loss report or Trial Balance?
- Profit & Loss Report or Trial Balance - Includes all Income and Expenses during the date range
- Balance Sheet - Includes all accumulated revenue and Expenses from prior periods, so the books never close
It is recommended to use the Compare Dates in the Filters on the Balance Sheet to find the Net Income for the period that matches your Profit & Loss Report or Trial Balance instead.
How can I reflect my fiscal year in my Reports?
If you need to adjust any of your reports to reflect a particular year, or a year end, click on the Filters next to any Report's title to adjust the Date Range. For example, see the steps in the Profit & Loss Report here.