Is it normal to see negative assets on Balance Sheet?

by a professional from Georgia Institute of Technology

2 years ago

I'm evaluating a semi-asset heavy business. It is a concrete and structural business that caters to residential and commercial customers. while evaluating the balance sheets, I noticed assets were negative for years###-###-#### is that normal or is it a red flag I should look out for ?

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searcher from The University of Texas at Austin - Red McCombs School of Business

It is very normal for small companies to have non-perfect accounting.

2 years ago | like reply | 1 like

searcher from Northwestern University - Kellogg School of Management

I've seen owners book negative AR for customer deposits rather than as a positive liability which would be more correct. Their accountant adjusted it when compiling the statements at the end of the year. Not necessarily a red flag for me, but definitely peculiar -- like a lot things I've found looking at these small businesses.

2 years ago | like reply | 0 likes

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