Balance sheet

The two sides always agree, because one of them is defined as the difference of the others: $\text{Assets} = \text{Liabilities} + \text{Equity}$. Everything the company controls appears as assets; every claim on those resources, whether from lenders or from owners, appears opposite as liabilities and equity. International standards call the same statement the statement of financial position, which is the name to look for in accounts drawn up outside the United States.

It is a snapshot rather than a film. The income statement and the cash flow statement cover a stretch of time, usually a quarter or a year, while a balance sheet describes the state of things on the closing day of that stretch. Reading two consecutive balance sheets side by side is what shows movement: inventory building up, debt being repaid, retained earnings growing by whatever profit was not paid out.

That it balances proves nothing about the health of the business. Balancing is an arithmetic requirement of double-entry bookkeeping, not a verdict. The useful reading looks at what the totals are made of: how much of the asset side is cash rather than slow-moving stock, how much of the funding is borrowed rather than owned, how soon the obligations fall due, and what the gap between short-term assets and short-term obligations leaves as working capital. Remember too that most of the page is built from what things cost rather than what they would fetch today, with traded investments among the exceptions carried at market value, and that whole categories of worth, including brands and know-how built in-house, never appear on it at all.