The Trial Balance and the Balance Sheet might sound the same, but both statements are different. Here are some of the differences between the Balance Sheet and the Trial Balance.
1. The Balance Sheet does not consist of opening stock, while the Trial Balance does not consist of closing stock.
2. The Balance Sheet offers an overview of the financial position of the business on a particular date, whereas the Trial Balance examines the arithmetical precision in the posting and recording.
3. The statement of liabilities, equity and assets is referred to as the Balance Sheet, while the statement of credit and debit balances derived from the general ledger is referred to as Trial Balance.
4. The Balance Sheet is one of the parts of the Financial Statement, whereas the Trial Balance does not belong to the Financial Statement.
5. The Balance Sheet reveals the balances of the real and personal account. The balances of all nominal, real and personal account are displayed in the Trial Balance.
6. The Balance Sheet is produced at the end of every month, while the Trial Balance is prepared at the end of every month, quarter, half of the year or the fiscal year.
7. The Balance Sheet is for both external and internal purpose, such as to tell outside people about the financial status of the company. For the Trial Balance, its purpose is only for internal usage.
8. The Balance Sheet is created after the preparation of the account of Profit & Loss and Trading, while Trial Balance is generated after publishing into the ledger account.
Nevertheless, there are some similarities between the Balance Sheet and the Trial Balance.
1. The Balance Sheet and the Trial Balance are statements.
2. The headings of the Balance Sheet and the Trial Balance are identical.
3. The Balance Sheet and the Trial Balance are the consideration of Nominal, Real and Personal Account (Also see Different Types of Special Journals and Subsidiary Ledgers) .
There are lots of differences between the Balance Sheet statement and the Trial Balance statement. The Trial Balance and Balance Sheet are distinct from each other. The Balance Sheet is a must in every business, while the Trial Balance is not mandatory at all. The users of the financial statement read the Balance Sheet but rarely read the Trial Balance since it is normally used by accounting firm in Johor Bahru. The Balance Sheet is prepared at a specific date, which is generally at the end of the fiscal year while the Trial Balance is generated upon request of the company.