The difference between an asset and a liability.

The balance sheet as the main form of reporting has two components - an asset and a liability, between which there are significant differences. But, in spite of everything, the most important thing: in the balance sheet the asset is always equal to the liability, although their items have different purposes and principles of formation. Let's try to reveal this topic in more detail so that the meaning of what has been said becomes clear.


Asset represents are economic assets that are at the disposal of the enterprise, and their intended use can bring certain economic benefits to the owner.

Liability is associated with the company's debt to legal entities and individuals, and the fulfillment of these obligations entails an outflow of capital from the organization.


The balance sheet asset includes those items that can bring any benefit in the future, if they are used correctly. Assets include cash in the accounts and at the cash desk of the organization, inventories and finished goods, fixed assets and intangible assets or receivables. For example, the use of inventory leads to the manufacture of products that can be further sold to potential buyers. Accounts receivable for which the statute of limitations has not expired can become cash if the debtors repay their obligations to the organization. With the help of fixed assets, the company manufactures products, but, in addition, they themselves can be sold if the need arises.

The liabilities of the balance include those items for which the organization has obligations, for example, authorized capital, accounts payable, payables to personnel. If management decides to pay debts to creditors or pay salaries to employees, then there is an outflow of capital from the enterprise. In addition, if one of the founders of the company decided to withdraw from the membership, then the company is obliged to pay him that share of the authorized capital that was originally contributed by him.


  1. An asset and a liability are two different parts of the balance sheet, which, however, have the same resulting values, that is, an asset is equal to a liability.
  2. The assets of an enterprise can always bring income in the future from their use, and liabilities involve an outflow of funds from the enterprise.