| forecast for year beginning the 1st. | May 2017 | May 2018 | May 2019 |
| Fixed Assets | 56,624 | 54,081 | 77,791 |
| Current Assets | 217,675 | 261,733 | 506,750 |
| Total Assets | 274,298 | 315,813 | 584,540 |
| Current Liabilities | 154,652 | 125,407 | 181,409 |
| Long Term Liabilities | 13,878 | 4,095 | 11,648 |
| Total Liabilities | 168,530 | 129,502 | 193,057 |
Net Current Assets (Working Capital) | 63,022 | 136,326 | 325,341 |
| Net Assets | 105,768 | 186,311 | 391,483 |
| Capital | 5,000 | 5,000 | 5,000 |
Retained Profits Bfwd | 20,000 | 100,768 | 181,311 |
add: Profit / Loss after Tax | 80,768 | 80,543 | 205,172 |
less: Dividend | 0 | 0 | 0 |
Retained Profits C/Fwd | 100,768 | 181,311 | 386,483 |
Capital and Reserves (Equity) | 105,768 | 186,311 | 391,483 |
The balance sheet matches equity to net assets. That defines solvency for a going concern. Net current assets describe working capital.
Equity, also known as shareholders’ funds or reserves will include paid up share capital, re-invested tax paid profits and share premium account if applicable.
Net assets / equity in deficit describes technical insolvency.
Working capital refers to core trading assets such as cash, accounts receivable and stock that will turn into cash within a year minus all debt scheduled to be paid within a year. That measures balance sheet liquidity.
It also tells you and others (for example the bank) how well your business plan will be capable of generating cash to support core trading operations for the year or years ahead.
Figurewizard's What-If Calculator and Planner gives you the opportunity to update / change forecasts in real time. Here it is used to improve working capital and cash by reducing forecast wages and fixed overheads - Each by increments of 5%
| Year 1 less | Fixed O/Heads & Wages | Pre-Tax Profit | Equity | Working Capital | .Borrowings plus / minus | Bank Year End |
| 0% | 430,000 | 94,381 | 105,052 | 59,993 | 53,854 | -35,439 |
| 5% | 408,500 | 116,779 | 123,911 | 81,165 | 33,488 | -13,261 |
| 10% | 387,000 | 138,712 | 141,677 | 98,931 | 9,962 | 8,452 |
Cost less depreciation describes the net book value of fixed assets in the balance sheet. This is the residual value of their forecast working life in the business, not their estimated fair market values.
That is an important distinction. Depreciated net book values for fixed assets are almost always significantly lower than they could be expected to fetch if put up for sale. In the event of a forced sale, prices will be lower still.
Fixed assets play no part in defining liquidity other than depleting it upon their acquisition; regardless of asset financing.
Working capital and cash flow forecasts will also be affected by investment in new fixed assets. The cost plus any new debt associated with financing always reduces balance sheet liquidity.
For example, in this sample forecast, £30,000 of new main pool assets (e.g. plant and machinery, fixtures, equipment, trucks and vans) and £25,000 for company cars have been entered, a total of £55,000. Seventy percent of that is financed over 24 months.
The table below shows how that £55,000 affects working capital and cash flow, followed by what happens to these if first the £25,000 for new cars is removed followed by the £30,000 of new main pool assets.
| Fixed Asset Acquisitions | Fixed Overheads | Interest Charges | Equity | Working Capital | Increase / Decrease Borrowings | Bank Year End |
| 55,000 | 430,000 | 5,062 | 105,052 | 59,993 | 53,854 | -35,439 |
| 30,000 | 408,500 | 3,104 | 127,097 | 100,956 | 5,616 | -691 |
| 0 | 387,000 | 1,488 | 143,371 | 135,789 | -48,780 | 69,719 |
No intervention by a user is called for to calculate this balance sheet forecast. Figurewizard will automatically produce it simply from your forecast sales, margins, overheads, investment and a few simple cash ratios.
UK corporation tax .and VAT are automatically calculated and applied to the forecasts and the calculator / planners by the system.
Up to a hundred complete sets of forecasts can be saved. Subscribing to Figurewizard is just £30 a year. There are no extra charges..