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BUSINESS ADVISOR
Stephen Earnhart
Accounting 101: What's a Balance Sheet?
A balance sheet has 3 parts: assets, liabilities and ownership equity.
n health care, we
I
have the medical
BALANCING ACT A balance sheet is often described as a
snapshot of a business's financial condition.
term "homeosta-
sis" to describe the
body's ability to
maintain internal
equilibrium or stability in the face of
external change. In finance, there's also a term for this: the "balance
sheet." As an administrator or manager, you need to know what this
business basic is and how to use it.
The financial statement, which is primarily used by accountants and
business owners, gives you a snapshot of your company's financial
position at any point in time. Other financial statements include statement of cash flow, income statement and stockholder equity — which
tend to be issued quarterly or annually.
So if you want to know right this minute the financial holdings and
position of your facility, you need to ask your accountant specifically
for a balance sheet. (Or generate one yourself.)
More likely, you'll need one when a creditor requests information
before deciding whether to extend credit for equipment or a loan to
expand your facility. Other likely scenarios: if one of your facility's
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