Understanding the Balance Sheet
Fixed Assets
Assets your company intends to keep for more than a year. Tangible assets include physical items like computers, machinery, and vehicles. Intangible assets include patents, trademarks, or purchased goodwill.
Current Assets
Assets that will be used or converted into cash within a year. The most common are 'Cash at Bank and in Hand', inventory/stock, and 'Debtors' (money owed to you by customers).
Creditors
Money your company owes. 'Creditors due within one year' includes unpaid supplier invoices, VAT bills, and your calculated Corporation Tax for this period. 'Creditors due after one year' typically covers long-term bank loans or bounce-back loans.
Capital and Reserves
This is the net worth of your company, representing the owner's equity. It includes 'Called up Share Capital' (the value of shares issued) and 'Profit and Loss Account' (retained earnings from this and all previous years). It must exactly match the total of your net assets.