The balance sheet is the most essential part of business, it must be maintained properly; But if it is not so. The balance sheet is unbalanced then you are to balance it, in this article we have provided the reasons behind the unbalancing of balance sheet and steps to resolve this. The details you get here will help you to improve your balance sheet without unbalancing. if you need our suggestions and help we are here to help you +1-844-405-0904.
A business or an organization, Have their own capital, assets, and liabilities and the statements of these are known as balance sheets. Know how to fix an unbalanced balance sheet.
If you want to tally your balance sheet remember that the liabilities and assets of the company should be similar to each other. You should make your balance sheet very carefully because even a single mistake can make it unbalanced. An unbalanced balance can also affect your business; it can decrease the profit of the company by decreasing the decision making power of your company. But a question arises here: how to fix an unbalanced balance sheet. There are a few important steps you need to follow carefully so you are able to balance your balance sheet. It’s very tricky if you want then take help take help from an accountant.
Why is your Balance sheet not balancing?
When the report of your balance sheet is not zero. You have to check if there are any errors in the ledger transaction.
Capital that is contributed by the investors. They have stock. It is also defined as paid-in capital. We have to balance the balance sheet, The company’s assets should be equal to the liabilities and net asset value.
Fix Your Unbalanced Balance Sheet
1. Running Reports With Accrual Basis
- There is an option “Report Menu” from which you need to select “Company and Financial” then select “Balance Sheet Summary”.
- Then there is an option “Customize Report” click on it.
- And there is a display tab. From the display tab, Under the report basis, select “Accrual”
- After this click “OK”
Whenever on an accrual basis your balance sheet is going out of balance. Then remember you need to recreate the profile of your company First, But if this same situation is present on a cash basis. Or you already recreate the profile of the company then also your balance sheet is going out of balance then read this second step.
2. You Need To Find That Date When The Balance Sheet Is Out Of Balance
Why your balance sheet is out of balance. Maybe by your transactions. If the problem is caused by a transaction. We need to find that date when it is out of balance.
- From an option “Report Menu” you have to select “Company and Financial” then select “Balance Sheet Summary”
- Click on “Customize Report”
- Then there is an option “display tab” and there is a date drop down also, Under the date dropdown chooses All.
- Under the Report Basis Section option. If on an accrual basis the balance sheet is out of balance then choose Accrual if not then choose cash.
- Under the column section, In-display columns dropdown, Click on year then choose ok.
- Now, you have to do a comparison between the sum of assets to the sum of liabilities and equity. Then find the year when the balance sheet is out of balance.
- After finding the year you can again do the same steps to find out the complete date because we need to fix the unbalanced balance sheet. So you have to find the complete date.
- Redo from step 1 to step 6, And again in the display column dropdown, choose a month.
- After, finding the month Redo from step 1 to step 6, And again in the display column dropdown, choose week.
Now, you have a complete date (week, month, year). But not having a date you can also find dates from this similar process. From the display, the column dropdown chooses a date. Now, you have the date when your balance sheet is out of balance.
3. Finding That Transactions Which Are making Balance sheet out of balance
- From that date, you find out to run transaction details.
- On the reports, menu chooses a custom report, after choosing a custom report click on transaction detail.
- Then at the modify report window, Check the report data range section submit your date.
- On the report basis section. If on an accrual basis the balance sheet is out of balance then choose Accrual if not then choose cash.
- In the column section, choose the amount and there are 4 options: account, clr, class and split uncheck them. It will help you to read the report easily. Then click on the paid amount column.
- Choose OK.
- Check whether The closing balance in the paid amount is equal to the amount which is out of balance.
4. Date Again To Your Transactions
- If your transaction is creating the problem, change their dates. Write down all the dates. And now you have to change that dates for the single transaction. Change that day into a day 20 years in the future.
- Save all the transactions
- Then reload that report, If you got the right transaction, The amount of the paid account will be empty.
- That transaction you date them in the future now dates them again to the original date.
Now, by this method, you are capable to correct an unbalanced balance sheet.
5. Remove And Again Submit The Transactions
Properly edit the dates of your transactions and if the problem is not solved yet. Then try to remove all the dates and again submit carefully.
Hope this content will help you to balance your unbalanced sheet, but if you need any technical help then feel free to contact our technical support team by dialing our toll-free +1-844-405-0904 and get instant help from our Intuit Certified ProAdvisors.