Gather the required information. You will need a complete list of the firm’s assets, including cash, accounts receivable, fixed assets such as land, buildings, equipment, and any other item of value the company owns. A similar list of all the firm’s obligations is also required. The key to creating a balance sheet that is a useful tool is completeness and accuracy. For formal documents like an annual report, the balance sheet should be audited by an outside accounting firm to verify its validity. Format the balance sheet with the company heading and date at the top. Below this, the first section lists the assets of the company, with totals at the bottom. Next, the liabilities are listed and again totaled at the end. Finally, the equity (sometimes called stockholder’s equity) is listed. The equity will always be the difference between the total assets and total liabilities. For purposes of comparison, figures from the previous year’s balance sheet may be listed in a separate column to the right of the current figures. List each category that falls under the Assets section and the total dollar amount. In many cases there will be sub-categories and the dollar amounts should be listed and totaled for the category. For example, under Cash and Cash Equivalents you may have categories such as Petty Cash, Bank Deposits, and Money Market Funds, with a total for the category following these items. The same procedure is followed for all categories of assets. Follow the same procedure for listing liabilities. Remember, all obligations of the company must be listed, including accounts payable, loans, and bonds or other debts which the firm must pay in the future. Calculate the equity by subtracting the total liabilities from the total assets. Finally, supplementary information can be added as a separate listing or explanatory section. This can include basic information such as company sales. An explanation might be added to inform the reader of a large write-off that cased a significant change in the value of the equipment the company owns.