The trial balance is a familiar concept for accountants in any business. It is one of the required reports included in a company’s financial statements, regardless of whether the business is small or medium-sized.
This report gives businesses an overview of the increases, decreases, and current balances of assets and capital sources during the reporting period, from the beginning of the year through the end of the reporting period. So how should a trial balance be prepared under the current Circular 133? Find out in the article below with Wacontre.
Sample trial balance template under Circular 133
Note: When outsourced accounting services or external chief accountants are used, the certificate number of the accounting service practice registration and the name of the firm providing the services must be clearly stated.
Basis for preparing the trial balance in accordance with regulations
The trial balance must be based on the following sources:
– The general ledger
– Detailed accounting books, ledger cards, or detailed summary tables
– The trial balance from the previous period
These sources are reconciled and checked against the figures recorded in the financial statements and must be submitted together with the financial statements to the tax authority in charge of the enterprise.
Content and method for entering line items in the trial balance under Circular 133
1. Steps to complete before preparing the trial balance
– Complete all tasks related to detailed accounting books and the general ledger
– Review, check, and reconcile data between the related books
2. Two types of figures applied and recorded in the trial balance
The first type is data that reflects account balances at the beginning of the period (recorded in columns 1 and 2, called the opening balance of the year) and at the end of the period (called the year-end balance and recorded in columns 5 and 6). Specifically:
– The "Debit" column reflects accounts with debit balances
– The "Credit" column reflects accounts with credit balances
The second type is data that reflects amounts arising in the accounts from the beginning to the end of the reporting period (recorded in columns 3 and 4, the amounts arising during the period). Specifically:
– The "Debit" column reflects the total debit amounts arising in the accounts
– The "Credit" column reflects the total credit amounts arising in each account
+ Columns A and B are used to record the account numbers and account names of all Level 1 accounts in use, as well as any Level 2 accounts that need to be analyzed.
+ Columns 1 and 2 – "Opening balance"
- Opening balance of the reporting year – reflects the balance on the first day of the first month of the year
- Based on: the opening balance of the first month of the year in the general ledger, or the "Year-end balance" from the previous year’s trial balance.
+ Columns 3 and 4 – "Amounts arising during the period": this column reflects the total debit and credit amounts arising in the accounts during the reporting year.
- The figures are based on the line "Cumulative amounts arising from the beginning of the year" of each corresponding account in the general ledger.
+ Columns 5 and 6 – "Closing balance": reflects the balances on the last day of the reporting year
- Based on the month-end balance of the last month of the reporting year in the general ledger, or calculated from the figures in columns 1 through 4 of the current year’s trial balance.
- These figures will be used to prepare the following year’s trial balance.
3. After recording all account-related figures, the totals of the trial balance must be calculated.
We hope the information above helps you understand and master the steps for preparing a trial balance under Circular 133. Explore more articles related to the accounting profession on our website.
