Understanding Balance Sheets for Japan
Balance sheets are often printed to show the year-to-date (YTD) net income or loss at the end of the equity section. In Japan, balance sheets must be printed so that the YTD net income or loss appears as a component of the retained earnings within the Equity section of the report.
Before you can print a balance sheet in the format required in Japan, you must set up a new account in your chart of accounts, and set up an automatic accounting instruction (AAI) to write the YTD income or loss to the new account.
When you set up the new account you must:
-
Set up a non-posting account.
-
Set up an account that is sequenced within your chart of accounts so that the account is included in the subtotal for retained within the Equity section of the balance sheet report.
You must set up the new AAI by company to write the result of the net income calculation to the new YTD Net Income account.