Trial Balance

A statement of all debits and credits in a double-entry account book, with discrepancies highlighted.

A trial balance lists all ledger accounts with their debit and credit balances to verify the equality of total debits and credits.

- Used to prepare and present financial statements and disclosures.
- Used when classifying items and explaining accounting impacts to users of the financials.

- Example: During financial statement preparation, **Trial Balance** guides how information is presented and disclosed.

- Why it matters: Enhances transparency, improves comparability, and reduces misunderstanding by stakeholders.