How do Balance Sheets Relate to the Practice of Accounting and its Uses in Business

In accounting, balance sheets convey the assets, liabilities, as well the equity of an organization. Balance sheets, requiring careful examination, will illustrate an organization’s general financial condition. 

Oftentimes, for proper analysis, accountants may divide a balance sheet into classifications/categories, in order to identify as well as subtotal any important entries. 

Businesses use balance sheets several different ways – an organization uses a balance sheet to report finances - as part of a limited company's annual accounts; as a resourceful tool to guide management in making improvements to help the company run more efficiently; as well as aiding the owner, in addition to other interested parties (creditors, investors, and/or shareholders) in understanding the  financial worth of a given company at any given point in time.