CHAPTER2OPENING BALANCES The first sheet to format is the one for opening balances. These are the values for assets, liabilities and capital extracted from the notes to the balance sheet, for the previous financial year. They may also be values for assets, liabilities and capital available at the time of starting a business. Capital is generated from assets and liabilities using the accounting equation of; Assets – Liabilities. Below is an illustration of the Opening Balances sheet;Below is the formatting procedure:We start by creating a new workbook. Click the Ribbon, point at “Save as”, click “Excel Workbook “, type (your name or Business name), then “Excel Accounts” , saving in a location of your choice.Rename sheet 1 and call it “1 Guide”. To rename, double click at the sheet name tab at the bottom, when it turns black, type the desired name, then click anywhere else.Rename sheet 2 and type “2 OB”The default font should be Calibri 11. Please check and if its not, then select the whole worksheet and change it to that. Other fonts may be too small or too wide. However, we can choose a font of our preference.Type: “Opening Balances” in B1, bold and underline it.Type: “Fin Year: in C1, “Date From” in D1, “Date To” in D2, and right align D1 and D2. If you want you can specify the date format to be recorded in D1 and D2. (its not vital)Type “20” in A5, “Fixed Assets” in B5, “Equipment, Machinery & Vehicles” in B6 (Right Alignment-RA), then “Other Fixed Assets” in B7 (RA), Type “21” in A8, then “Stock” in B8, Type “22” in A9, then “Trade Debtors” in B9, Type “23” in A10, then “Bank” in B10, Type “24” in A11, then “Cheque & Electronic” in B11, Type “25” in A12, then “Cash” in B12, Type “26” in A13, then “Other Current Assets” in B13, Type “Prepayments” in B14 (RA), “Rent Deposit” in B15(RA), Type “27” in A18 then “Trade Creditors” in B18, Type “28” in A19, then “Vat Payable” in B19, Type “29” in A20, then “PAYE & NI” in B20, Type “30” in A21, then “Credit Card in B21, Type “31” in A22, then “Other Current Liabilities” in B22, Type “Accruals” in B23 (RA), then “Net Wages” in B24,Type “32” in A28, then “Loan” in B28, Type “33” in A29, then “Capital” in B29, Put a formula in D5 to compute the Total Fixed Assets value. It should sum C6 and C7 and the resulting content should be “=SUM(C6:C7).How Do We Sum? While in the “Home” on Excel Ribbon, click the destination cell for the sum, click the sum icon in the Top right corner, highlight the cells to be added (C6 and C7 in this case), then press enter.Insert a formula in D13 to sum the Other Current Liabilities in C14 to C17 and the resulting content should be “=SUM(C14:C16)”Insert a formula in D22 to sum the Other Current Assets in C23 to C27 and the resulting content should be “=SUM(C23:C27)”Insert a formula in D29 to compute the Capital figure using the accounting equation of; Assets – Liabilities. However, liabilities and Capital are negative and red since they don’t belong to the business. So the formula starts with a negative sign it covers it sums from D5 to D28. The resulting content should be “=-SUM(D5:D28)”.Highlight column C5 to D29, click Home tab, the Number arrow, and Number again, ensure the decimals are at 2, tick separator box, click the last red figure below, (for the negative numbers to appear in red and brackets), then “OK”. Type “Amount in D29 should equal the Capital figure on Balance Sheet” in B30, and “For Previous Financial Year.” in B31.As a guide, we insert a 15% grey shade into the cells where figures can be recorded. Click the “Home” tab, Using the CTRL key, we click on the following before we click on the fill colour icon, to select the15% grey shade. The cells are; C6, C7, D8, D9, D10, D11, D12, C14, C15, C16, C17, D18, D19, D20, D21, C23, C24, C25, C26, C27, and D28.