Basically there are different methods or tricks for preparing a balance sheet. Please don’t get confused.. As I am talking about the finalizing the accounts of the company or balance sheets. I am only concerned about preparing such balance sheet in excel format only after finalizing of account balance i.e. Final Trail Balance. I often found that we just get puzzled while preparing balance sheet i.e. its Lists, Annexes, Details, Schedule and notes and not only this the major issue that comes when all the entries are sub-headed to its relevant annexes but still the balance sheet doesn’t gets tally. Why is it so? and the other problem that i probably faced while preparing the same was – while totaling the balances the decimal values really troubles to me. So while solving these huddles i developed some tricks and techniques which will really help us to endevour it much earlier and faster..
Process to follow upon:
1. First focus on the finalizing the trial balance
- During the audit there might be some queries, get it solved first.
- Their might be some entries that needs to be rectify or needs to be added in the books.
- Accounting heads needs to be changed.
- So get final the trail balance
2. After the finalization of trial balance, get the trial export in excel format it will not matter at all whether the books has been prepared in Tally.Erp or SAP or any other accounting package. Every accounting packages posses the option to get export. So select that option and import the trial in the XML format:
Materials of the Balance Sheet
Now it is very much important to understand that what are the tools of the balance sheet. I am not talking about all those reports and documents relating to the audit. I am only concerned with the balance sheet format. So these below might be the tools to prepare the balance sheet:
- Notes to Accounts
- Lists to Accounts
- Cash Flow Statement
- Profit/Loss Accounts
- Balance Sheet
4. As in the balance sheet we have to show both P.Y.and C.Y. balance, so before moving to the current year balance first just change the previous year balance from the last year balance.
5. After then change the current year balance.
6. This can be done by linking the list and schedules with the final trial balance exported earlier.
7. So there is two ways for that :
a. Make the details and annexes in the balance sheet or performance made or just copy the previous year balance sheet of previous years and make the changes
b. In the Exported balance sheet, just differentiate them according to the revised schedule-VI of the “Companies Act” and then separate them according to the lists, notes and schedules required for the balance sheet.
8. Use the formulas for getting linking to the values to the respective items of the balance sheet and its schedules or notes or annexures of the balance sheet.
The above can be linked-up in two ways:
a. Use the “VLOOKUP formula
b. Giving reference to the cell where the same ledger is posted on.
a. Use the “VLOOKUP” formula
What actually this will do is that when you are preparing the balance sheet from the trial balance after exporting it to your sheet, then it automatically finds the amount of the heads you desire from the trial. The process that could be followed:
- Make a ready heading of the ledger to be shown either in the schedules or in the list. Ex: If you want to show the debtors list in the Balance sheet then just make a list to that in the schedule sheet.
- Then use the “VLOOKUP” formula to get the amount linked from the tally.
- Then make the next list as the above.
- Follow this procedure till when all the List gets prepared.
- Then in the schedule sheet just give the link of the “total” of the List.
- And finally give the link of Schedule with the balance sheet & Profit & Loss A/c page.
b. Giving Reference to the cell:
Its an easy procedure where in the particular cell just press “=” and give the reference of the cell, then the respective value will be inserted to it.
9. Some times it is quite often that due to uncertain reasons the trial balances can be changes or might be changed due to any provisions made at the end of year or any omission entry in the books of account. So let then finalize the trial at any cost. So the main problem arise at that time will be that whether to cancel the whole balance sheet and to create the same with all the above mentioned points as above.
So, then what is the the next conclusion then.
Yup, during the experience and the experience i got to know why should not we keep the previous balance sheet as we have prepared and then just follow the steps as:
- First of all, just import the new trial balance in the same file which has been already prepared.
- Then what to do is that just link that new trial with the previous trial figure so that new figure will be automatically updated or incorporate in the old trial and then it will automatically link the updated trial balance in the balance sheet annexes or the list prepared earlier.
- And then just hide the new trial balance so that it will not get confusion later on, about which one is the final trial now.
- If later on also the same queries arrive then also do the same procedure, discussed above.
After that Prepare the notes to accounts and auditor report as prepared in previous years.
What will be its benefit? Why should it be followed for the preparation of the balance sheet
Well I can give the answer to this question as, to solve lots of occurrence during the last date of balance sheets or when its a great pressure time when we have to just prepare the balance sheet in a quick time. And at that time at a great rush, we makes lots of clerical errors and even lots of technical also. So, to the clerical errors it can help in the manner that it will just takes only those items which have entered in the trial balance and for the technical matter it is quite more easy as the correct item will be push up automatically in the correct head. So, then now we have to decide whether we want to enter the amount manually.
a. As the amounts are taken directly from the exported tally amount, so balance sheet will get automatically tallied.
b. The decimal problems will be removed.
c. While the experts who will gets reviewed to with, has to invest only less time as whole of the amount is linked to the trail balance.
I hope it will provide you to prepare a Balance sheet in a quick time.
Thanks for reading.