[Column] Key Points on Selecting the Fiscal Month in the Balance Sheet

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The income statement is based on annual figures, while the balance sheet represents the flow of funds at a specific point in time. Therefore, when selecting the fiscal month, the weight given to the balance sheet is higher than that of the income statement. What must be particularly considered is the balance between total current assets and total current liabilities, with the ideal situation being when total current assets exceed total current liabilities. However, the contents of total current assets are also important. The worst scenario is when 2. inventory reaches its highest amount throughout the year, while the best scenario is when 5. cash and cash equivalents are at their highest when preparing the financial statements. Since the balance sheet reflects the flow of funds at a specific point in time within the 12 months of a year, it should represent the best financial state for the company. *For detailed content of the column, please refer to the related links. For more information, feel free to contact us.*

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