Financial statements
Balance Sheet and Income Statement: what your business is worth and what you earned this period.
Financial statements answer the two questions that really matter: "how much do I have?" and "how much did I earn?". They are the ledger's highest output and are available on the Premium plan.
Balance Sheet: how much I have
What it's for
The Balance Sheet is a snapshot at a date. It tells you, as of today (or any date you ask for), what you have, what you owe and what is yours. It rests on an equality that never fails:
Assets = Liabilities + Equity
How to read it
Section | Account | Amount |
|---|---|---|
Assets | 1101 Cash | RD$12,300 |
| 1200 Loan Portfolio | RD$18,500 |
| 1290 Allowance for Uncollectibles | −RD$2,000 |
| Total assets | RD$28,800 |
Liabilities | RD$0 | |
| Total liabilities | RD$0 |
Equity | 3101 Lender's Capital | RD$25,000 |
| Result for the period | RD$3,800 |
| Total equity | RD$28,800 |
And it balances: RD$28,800 = RD$0 + RD$28,800. ✅
Two things worth understanding in this table:
- The allowance (1290) subtracts. It is a contra-account: it lives among the assets but is deducted. Your gross portfolio is RD$18,500, but you have already reserved RD$2,000 you believe you won't collect, so your net portfolio is RD$16,500.
- "Result for the period" is not an account you move. Prestafolio computes it live (revenue minus expenses up to the date you asked for) and injects it into equity. Without it the balance sheet wouldn't balance, because this period's profits still live in the 4xxx and 5xxx accounts. When you **close the period**, that result moves to Retained Earnings (3202) and this computed line falls back to zero by itself.
When I use it
- To know what your operation is worth at a given moment.
- To ask for financing or to show a partner where the business stands.
- At month-end or year-end, alongside the trial balance.
You can request it at any past date ("what did it look like on December 31st?").
Income Statement: how much I earned
What it's for
If the Balance Sheet is a photo, the Income Statement is a film: it covers a whole period (a month, normally) and tells you everything you earned and everything you spent in it.
Net result = Revenue − Expenses
How to read it
Section | Account | Amount |
|---|---|---|
Revenue | 4101 Interest Income | RD$4,500 |
| 4102 Arrears Income | RD$1,300 |
| 4103 Service Income | RD$1,200 |
| Total revenue | RD$7,000 |
Expenses | 5201 Provision Expense | RD$2,000 |
| 5301 Operating Expenses | RD$1,200 |
| Total expenses | RD$3,200 |
| Net result | RD$3,800 |
This report is where you finally see your real profit: not the cash that came in (which includes capital you are merely recovering), but what you actually earned.
When I use it
- Every month, to know whether the business made money or not.
- To compare months and see whether arrears are eating your profit.
- Before closing the period: the net result you see here is exactly the amount the close will move into your retained earnings.
One important nuance
Unlike the Balance Sheet, this statement does not have to "balance" against anything: revenue minus expenses is its own definition, not an identity to be verified.
Edge cases
- No open period and no period specified: the Income Statement comes back empty (all zeros). The Balance Sheet always works: it doesn't depend on periods, only on a date.
- No activity: both come back at zero. That is not an error.
- The Balance Sheet says it doesn't balance: this shouldn't be possible (unbalanced entries are rejected on save). If you see it, contact support before closing anything.
Plan and permissions
- Premium plan only (Financial statements module). A Gold tenant, even with the trial balance and general ledger, does not get these two reports.
- Permission
accounting:read. The owner always has it.