Distinction between Statement of Affairs and Balance Sheet :

Statement of affairs which looks like a balance sheet differs from the balance sheet in the following respects.

Basis of Distinction	Balance Sheet	Statement of Affairs
1.      Objectives	To Know the fmancial position of the business	To find out the capital of business
2.      Accounting method	When accounting is maintained under double entry system, balance sheet is prepared	Statement of affairs is prepared when accounts are maintained under single entry system of accounting
3.      Basis of preparation	It is prepared exclu- -sively on the basis of ledger accounts	It is prepared on the basis of some ledger accounts and estimates.
4.      Reliability	It is regarded as a reliable statement	It is not regarded as reliable.
5.  Missing of Facts	Since both the aspects of all transactions are duly recorded, no chance for missing of facts.	There remains always a possibility for missing of facts, because the accounts are incomplete.