Srinagar, Sept. 30 -- You don't have to be an accountant to read a balance sheet. All that you need to know about is the assets that the business owns, what it owes and what is left for its owners. And this is just what a balance sheet reveals to you. While a profit and loss account covers a certain period of time, the balance sheet is prepared as of a certain day. The basic principle of preparing a balance sheet is that the total assets of a business entity equal its total liabilities plus shareholders' equity.

For instance, if a business has assets valued at Rs.50 lakh and owes Rs.30 lakh to various parties, the leftover Rs.20 lakh belongs to its owners.

Guide to Reading a Balance Sheet

Now let's learn how to analyse all elements of ...