The balance sheet is a type of document or accounting report that reflects the patrimonial situation of the entity at a specific moment.

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The balance sheet is formed by an ordered body composed of:

Assets

It consists of the set of goods and rights owned by the company, as well as other items used in revenue generation. Assets are composed of:

• Non-current assets: These are all those goods and rights that the company has owned for more than a year (long term). Non-current assets are further divided into tangible fixed assets, intangible fixed assets and financial fixed assets.

• Current assets: These are all those goods and rights that the company has owned for less than a year (short term). Current assets are divided into inventories, trade debtors and other accounts receivable, short-term financial investments and cash and other equivalent liquid assets among others.

Liabilities

It is formed by the set of financial resources obtained by the company for the development of its functions and by estimates of future expenses. The financial resources of Liabilities are classified according to their enforceability, enforceable or third-party. Within third-party or enforceable resources, liabilities are divided into:

• Non-current liabilities: Composed of all those debts that the entity has with third parties and that must be repaid in a period greater than one year. These would be bonds and debentures, bank loans and debts with long-term fixed asset suppliers.

• Current liabilities: Composed of all those debts that the company has with third parties and that have to be returned in a period of less than one year. These would be debts with the Treasury and Social Security, bank loans and debts with suppliers in less than a year…

Net equity

It is the difference between the Assets and Liabilities of the company. It includes contributions made by the partners or owners of the company, which do not have the consideration of enforceable liabilities, as well as accumulated results or other variations that affect it. It is formed by:

• Own funds: These would be formed by contributions made by founders or partners, as a loss, by the results (profits or losses) obtained by the entity throughout its life, and by the result (income minus expenses) of the current fiscal year.

• Adjustments for value changes.

• Subsidies, donations and legacies received.

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