Previously known as balance sheet, it is a detailed projection of the assets, liabilities, and owners’ equity of a business at a particular moment, typically the end of a financial period (a quarter, a fiscal year). It reports on the economic resources controlled by the business and how such resources are financed. It also describes the worth of the business at that moment. This statement doesn’t record flows of economic resources, but only the effects of these flows at one point in time.

This statement is prepared on the concept of the accounting equation which has assets on one side and liabilities and owners’ equity on the other:

Assets = liabilities + owners’ equity

It is a snapshot of the financial position/ status at a given point in time.