Sole Trader Accounts

The Statement of Financial Position — Layout and Key Items

AQA Standard Layout

[Business Name]
Statement of financial position at [date]

                                          £          £          £
                                       Cost    Acc. dep    NBV
Non-current assets
Property, plant and equipment        287 660      85 410    202 250

Current assets
Inventories                                       70 320
Trade receivables                     63 880
Less: provision for doubtful debts    (2 470)
                                                  61 410
Prepayments                                        4 060
Cash and cash equivalents                          2 450
                                                            138 240
Total assets                                                340 490

Capital account
At 1 January 2XXX                                          129 360
Profit for the year                                         89 080
                                                           218 440
Drawings                                                   (35 200)
                                                           183 240
Non-current liabilities
Loan                                                       100 000

Current liabilities
Trade payables                                    47 550
Accruals                                           3 150
Cash and cash equivalents (overdraft)              6 550
                                                            57 250
Total capital and liabilities                              340 490

Acceptable Orderings

AQA accepts either of these two arrangements:

1. Non-current assets + current assets − current liabilities = capital + non-current liabilities
2. Non-current assets + current assets − current liabilities − non-current liabilities = capital

Section-by-Section Notes

Non-current assets are presented in a three-column format:

• Cost — original purchase price (including delivery and installation costs to make asset useable)
• Accumulated depreciation — total depreciation charged since the asset was purchased
• Net book value (NBV) — cost less accumulated depreciation; this is the carrying value in the SFP

Current assets (in order of increasing liquidity):

• Inventories (closing inventory)
• Trade receivables less provision for doubtful debts
• Prepayments and accrued income
• Cash and cash equivalents (bank/cash)

Capital account (sole trader):

• Opening capital (balance at start of year)
• Add: profit for the year (or deduct: loss for the year) — own figure rule applies
• Less: drawings (cash and goods for own use combined)

Non-current liabilities — amounts repayable more than 12 months from the year-end (e.g. long-term bank loans)

Current liabilities — amounts repayable within 12 months (trade payables, accruals, prepaid income, bank overdraft)

Statement of Financial Position Notes

• The profit figure in the capital section is an own figure (OF) — marks are awarded if it matches the profit calculated in the income statement, even if that figure is technically incorrect
• A bank overdraft appears as a current liability, not as a negative current asset
• The SFP balances as: total assets = total capital + liabilities