How to Read and Understand a Balance Sheet

Whether you’re a business owner, employee, or investor, understanding how to read and understand a balance sheet is an essential financial accounting skill. Here’s everything you need to know about a balance sheet, including what it is, the information it contains, why it’s so important, and the underlying mechanics of how it works. Please note: The balance sheet presented in this video complies with International Financial Reporting Standards (IFRS), which companies outside the United States follow. US companies typically adhere to Generally Accepted Accounting Principles (GAAP). Learn more about the balance sheet on our Business Insights Blog: https://online.hbs.edu/blog/post/how-to-read-a-balance-sheet Learn more about GAAP vs. IFRS accounting standards: https://online.hbs.edu/blog/post/gaap-vs-ifrsFind out more about our online course Financial Accounting: https://online.hbs.edu/courses/financial-accounting/ Explore all our finance and accounting certificate courses: https://online.hbs.edu/subjects/finance-accounting/