What is a Trial balance?

Trial balance (Definition)

A trial balance is a report that shows the balances of all general ledger accounts at any given point in time for any company. It includes important accounting items, such as assets, liabilities, equity, income, expenses, gains, and losses, and the main purpose is to display the current state of the general ledger's debits and credits at a specific point in time. Creating a trial balance is the first step of closing the books at the end of the financial year (or other accounting period) and ensures that the accounts “balance”. If the general ledger accounts' debit and credit column totals don’t match, the trial balance indicates that something needs to be fixed.