what are the uses of a balance sheet 
a balance sheet explains the financial position of a company at a specific point in time as opposed to an income statement which reports financial information over a period of time a balance sheet is used to determine the health of a company on a specific day a bank statement is often used by parties outside of a company to gauge the company s health banks lenders and other institutions may calculate financial ratios off of the balance sheet balances to gauge how much risk a company carries how liquid its assets are and how likely the company will remain solvent a company can use its balance sheet to craft internal decisions though the information presented is usually not as helpful as an income statement a company may look at its balance sheet to measure risk make sure it has enough cash on hand and evaluate how it wants to raise more capital through debt or equity 