I've just run off a balance sheet and don't understand a couple of the entries. Under Net Worth I have dividends as an asset and P&L as a liability. All dividends have been paid so surely these should not be here but in the Statement of changes in Equity.
All the other entries appear to be the correct way round.
I would consider dividends as a profit and loss item which is not related to normal business trade.It would of course reduce the overall profit ie after admin and distribution expenses. Are there any Proposed dividends you need to accrual for into the Accounts. If there were this item would further reduce your overall profit but the proposed dividend would be put on the liabilities side of the balance sheet. Have a look at the Dividends Account and see what the account shows and track the posting it is made up of.
