{"id":10269,"date":"2025-10-14T16:29:13","date_gmt":"2025-10-14T09:29:13","guid":{"rendered":"https:\/\/fdi.co.th\/?p=10269"},"modified":"2025-10-16T15:38:46","modified_gmt":"2025-10-16T08:38:46","slug":"%e0%b8%87%e0%b8%9a%e0%b8%94%e0%b8%b8%e0%b8%a5%e0%b8%84%e0%b8%b7%e0%b8%ad%e0%b8%ad%e0%b8%b0%e0%b9%84%e0%b8%a3-how-to-%e0%b8%81%e0%b8%b2%e0%b8%a3%e0%b8%ad%e0%b9%88%e0%b8%b2%e0%b8%99%e0%b8%87%e0%b8%9a","status":"publish","type":"post","link":"https:\/\/fdi.co.th\/en\/%e0%b8%9a%e0%b8%97%e0%b8%84%e0%b8%a7%e0%b8%b2%e0%b8%a1-acc\/%e0%b8%87%e0%b8%9a%e0%b8%94%e0%b8%b8%e0%b8%a5%e0%b8%84%e0%b8%b7%e0%b8%ad%e0%b8%ad%e0%b8%b0%e0%b9%84%e0%b8%a3-how-to-%e0%b8%81%e0%b8%b2%e0%b8%a3%e0%b8%ad%e0%b9%88%e0%b8%b2%e0%b8%99%e0%b8%87%e0%b8%9a\/","title":{"rendered":"What is a Balance Sheet? How to Read Financial Statements for Beginners!"},"content":{"rendered":"
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What is a Balance Sheet? An Essential Statement Every Business Owner Should Know.<\/b><\/h2>

\u0e07\u0e1a\u0e14\u0e38\u0e25 (Balance Sheet)<\/strong>\u00a0 is a financial statement that shows a company\u2019s financial position at a specific point in time (quarterly or annually). It consists of three main components: Assets, which are what the company owns; Liabilities, which are what the company owes; and Shareholders\u2019 Equity, which represents the owners\u2019 residual interest in the company after liabilities are deducted.<\/span><\/p>

The balance sheet equation is: Assets = Liabilities + Shareholders\u2019 Equity.<\/b><\/em><\/p>

Did you know? The Balance Sheet has been renamed.\u00a0<\/i><\/b><\/span><\/h3>

The term \u201cBalance Sheet\u201d has been discontinued. According to accounting standards, it has been replaced with \u201cStatement of Financial Position\u201d to more accurately reflect the meaning of the financial statement.<\/span><\/p>

Further explanation:\u00a0<\/i><\/b><\/p>

1.Assets <\/b>\u00a0refer to resources controlled by the business that are expected to provide future economic benefits. Assets can be divided into two types:\u00a0<\/span><\/p>

1.1 Current Assets: Assets that are highly liquid and can be quickly converted into cash.<\/span><\/p>

1.2 Non-Current Assets: Assets that the business intends to hold for a longer period than current assets and are less liquid, such as land and buildings.\u00a0<\/span><\/p>

2.Liabilities<\/b> refer to the company\u2019s current obligations. Some types of liabilities can actually benefit the business, such as trade payables, which are short-term and interest-free, helping to improve cash flow. Liabilities can be divided into two types:\u00a0<\/span><\/p>

2.1 Current Liabilities: Short-term obligations that must be settled within one year.<\/span><\/p>

2.2 Non-Current Liabilities: Long-term obligations that require more than one year to settle.<\/span><\/p>

3.Shareholders\u2019 Equity:<\/b> The residual interest in the company\u2019s assets after deducting liabilities.\u00a0<\/span><\/p>

The Importance of the Balance Sheet.<\/b><\/h2>

Why is the Balance Sheet Important? For Entrepreneurs and Business Owners.\u00a0<\/b><\/h3>
  1. The Balance Sheet provides a clearer overall picture of the company\u2019s financial position.<\/b>
    <\/b>The Balance Sheet provides an overview of Assets<\/strong>, Liabilities<\/strong> , and Owner\u2019s Equity<\/strong> at the end of an accounting period. It shows \u201cat this moment\u201d the company\u2019s financial capacity, whether there is sufficient cash, and the level of debt, allowing for a clearer understanding of the overall business situation.\u00a0<\/span><\/li>
  2. Used as a tool for business planning.<\/b>
    <\/b>It allows business owners or managers to foresee whether additional investments are feasible, identify areas for cost reduction, and determine which assets are not generating revenue. The information in the Balance Sheet helps answer these questions more clearly.\u00a0<\/span><\/li>
  3. Used to assist in financial strategy planning, tax planning, and cost control.<\/b>
    <\/b> Knowing financial costs and outstanding items in the Balance Sheet helps you manage accounting and taxes more accurately and efficiently.<\/span><\/li>
  4. It serves as important evidence for \u201ctax filing and auditing,\u201d<\/strong> demonstrating the business\u2019s transparency and verifiability.<\/li>
  5. It serves as a tool to communicate \u201ccredibility\u201d to business partners and investors.<\/strong>A properly prepared Balance Sheet that reflects a strong financial position instills confidence in partners, investors, and business collaborators, showing that the company is stable and ready for long-term cooperation.<\/li><\/ol>

    Example of a Statement of Financial Position.\u00a0<\/b><\/h3>

    FD Company has assets including an office valued at 500,000 THB, cash of 1,000,000 THB, and computers and furniture worth 300,000 THB. The company has liabilities of 400,000 THB with a bank. FD Company was established by two partners, Ms. F and Mr. D, each contributing 700,000 THB in capital.\u00a0<\/span><\/p>

    Assets of FD Company.<\/strong>\u00a0<\/span><\/em><\/p>

    Office: <\/span> 500,000 THB<\/span><\/p>

    Cash:<\/span> 1,000,000 THB<\/span><\/p>

    Computers and furniture:<\/span> 300,000 THB<\/span><\/p>

    Total:<\/span> 1,800,000 THB<\/span><\/p>

    Liabilities<\/em><\/strong><\/p>

    Bank loan: <\/span> 400,000 THB<\/span><\/p>

    Owner\u2019s Equity<\/em><\/strong><\/p>

    Mr. F:<\/span> 700,000 THB<\/span><\/p>

    Mr. DD:<\/span> 700,000 THB<\/span><\/p>

    Total:<\/span> 1,400,000 THB<\/span><\/p>

    This can be represented in the formula as follows:\u00a0<\/strong><\/em><\/p>

    Assets = Liabilities + Owner\u2019s Equity<\/span><\/p>

    Substituting into the formula: 1,800,000 = 400,000 + 1,400,000<\/span><\/p>

    If financial transactions are recorded correctly according to accounting principles, the total of liabilities plus owner\u2019s equity should always equal the assets.<\/span><\/p>

    How to: How to read a balance sheet for beginners<\/b><\/h2>

    You can start reading the financial statement by following these steps.<\/span><\/p>

    \"\"<\/a><\/p>

    1.Read the total amount of each section.<\/b><\/h3>