The statement of financial position and the idea of balancing assets and liabilities is a difficult concept.

However, for IGCSE you don’t need an detailed understanding of how the Statement of Financial Position is constructed. Furthermore, questions on this topic are much less popular than questions on profit or cash flow.

What you do need to know are the contents of a statement of financial position with examples.

5.4.1 Statement of Financial Position

The statement of financial position is a snapshot taken at one moment in time, when we imagine that the business is frozen, and we count up all the business’s assets and liabilities.