Comparative Balance Sheet

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A comparative balance sheet presents side-by-side information about an entity's assets, liabilities, and shareholders' equity as of multiple points in time. For example, a comparative balance sheet could present the balance sheet as of the end of each year for the past three years. Another variation is to present the balance sheet as of the end of each month for the past 12 months on a rolling basis. In both cases, the intent is to provide the reader with a series of snapshots of a company's financial condition over a period of time, which is useful for developing trend line analyses (though this works better when the reader has the entire set of financial statements to work with and not just the balance sheet).

The comparative balance sheet is not required under GAAP for a privately-held company, but the SEC does require it in numerous circumstances for the reports issued by publicly-held companies, particularly the annual Form 10-K and the quarterly Form 10-Q. The usual SEC requirement is to report a comparative balance sheet for the past two years (with additional requirements for quarterly reporting).

There is no standard format for a comparative balance sheet. It is somewhat more common to report the balance sheet as of the least recent period furthest to the right, though the reverse is the case when you are reporting balance sheets in a trailing twelve-months format.

Here is an example of a comparative balance sheet that contains the balance sheet as of the end of a company's fiscal year for each of the past three years:

ABC International
Statement of Financial Position

	as of 12/31/20X3	as of 12/31/20X2	as of 12/31/20X1
Current assets
Cash	$1,200,000	$900,000	$750,000
Accounts receivable	4,800,000	3,600,000	3,000,000
Inventory	3,600,000	2,700,000	2,300,000
Total current assets	$9,600,000	$7,200,000	$6,050,000
Total fixed assets	6,200,000	5,500,000	5,000,000
Total Assets	$15,800,000	$12,700,000	$11,050,000

Current liabilities
Accounts payable	$2,400,000	$1,800,000	$1,500,000
Accrued expenses	480,000	360,000	300,000
Short-term debt	800,000	600,000	400,000
Total current liabilities	$3,680,000	$2,760,000	$2,200,000
Long-term debt	9,020,000	7,740,000	7,350,000
Total liabilities	12,700,000	10,500,000	9,550,000
Shareholders’ equity	3,100,000	2,200,000	1,500,000
Total liabilities and equity	$15,800,000	$12,700,000	$11,050,000

The comparative balance sheet reveals that ABC has increased the size of its current assets over the past few years, but has also recently invested in a large amount of additional fixed assets that have likely been the cause of a significant boost in its long-term debt.