Balance sheet making queries.

[IKAR]

Hello,

I am trying to prepare a balance sheet for options trading. I have one designated bank account for options trading. I was planning to show the bank balance of this account and money with the broker as assets. What do show as liabilities? I did not have any position open on 31st March.

On top of that a fellow trader confused me by saying I have to include all my assets including home, car, etc., all the bank accounts and all investments (mutual funds, FD, etc.) that are not related to my options trading account and show them as assets. Why should this be? Shouldn’t only the particular bank account and brokerage account be considered for making the balance sheet?

Thanks in advance.

 

[cinderblock]

If it's your own capital, the amount you started with should be under Owner's Equity and then add/subtract P&L account for the year.

Depending on your total income you may need to disclose assets not part of the business. Consult a CA.

 

[IKAR]

Thanks a lot @cinderblock for your reply. I am trading as an individual not sole proprietor with a current account. Still can I designate the money in the savings account linked to the broker as capital?

By total income related assets disclosure, are you referring to the 50 lakh per year income rule?

Thanks

 

[Mishra_86]

For an options trading balance sheet, only include the bank account and brokerage account as assets. Liabilities would be any debts or obligations related to your trading activities. Other personal assets like home, car, and unrelated investments should not be included.