Free balance sheet template
for small businesses

Keep on top of your businesses’ financial standing with our free balance sheet template designed for Australian small businesses.

What is a balance sheet?

A balance sheet provides a snapshot of your business’ financial standing at a specific point in time. On one side, your business’ assets are reported, and the other side shows your business’ liabilities and shareholders’ equity. 

A balance sheet is important because it tells business owners and investors what your company owns and what it owes. It’s an excellent tool to track your business’ worth at any given time and to show the profitability of your business to those who are interested in buying a share.

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Balance sheet template FAQs

Why is a balance sheet important for a small business?

A balance sheet is important as it provides a snapshot of a business’ financial standing at a specific point in time, and can tell business owners and investors what the company owns and what it owes. While its primary use is to track earnings and spending, a balance sheet can also be an excellent tool to show the profitability of a business to those who are interested in buying a share.

If your business is doing well, investors can take a look at your balance sheet and see if you have a profitable business they’d like to invest in. A balance sheet can also help you diagnose problems, pinpoint financial strengths, and keep track of your business’ financial performance over time.

What are the 5 steps to create a balance sheet?

There are 5 steps in creating a balance sheet:

  1. Determine the time period you’re reporting on.
  2. Identify your assets as of your reporting date.
  3. Identify your liabilities as of your reporting date.
  4. Calculate shareholders’ equity.
  5. Compare total assets against liability and equity.

Make sure to download our free balance sheet example template to make things easy!

What are the three main components of a balance sheet?

There are three main components of a balance sheet, these include:

Assets
Assets represent things of value that a company owns and has in its possession, or something that will be received and can be measured objectively. They are also called the resources of the business, some examples of assets include receivables, equipment, property and inventory. Assets have value because a business can use or exchange them to produce the services or products of the business.

Liabilities
Liabilities are the debts owed by a business to others–creditors, suppliers, tax authorities, employees, etc. They are obligations that must be paid under certain conditions and time frames. A business incurs many of its liabilities by purchasing items on credit to fund the business operations.

Owner’s Equity
A company’s equity represents retained earnings and funds contributed by its owners or shareholders (capital), who accept the uncertainty that comes with ownership risk in exchange for what they hope will be a good return on their investment.

Our free balance sheet example template makes working out the above easy – try it out now!

Should a balance sheet always balance?

Yes, a balance sheet should always balance. The name itself comes from the fact that a company’s assets will equal its liabilities plus any shareholders’ equity that has been issued. If you find that your balance sheet is not truly balancing, it may be caused by one of these culprits:

 

  • Incomplete or misplaced data
  • Incorrectly entered transactions
  • Errors in currency exchange rates
  • Errors in inventory
  • Miscalculated equity calculations
  • Miscalculated loan amortization or depreciation

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