ABSTRACT
The European Commission’s intention to reveal the lii|uiilily ami exchangeability of assets is certainly consistent with the need to evaluate a company’s liquidity and solvency at least to the extent of disclosing the situation at a point in time. A balance sheet, or statement of financial position is, accordingly, a statement of certain financial measures. If those measures are to be useful in the calculation of financial position, and an assessment of the company’s liquidity, then they will be measures of the monetary equivalents of the company’s assets and liabilities. Reference is made to the nature of the amounts shown for assets and liabilities. If these arc to show the financial position of the company, then they will be financial measures. It follows that the balance sheet, or more correctly, the statement of financial position, should be regarded as a statement of measures, and the classificatory system employed should follow the kinds of measures employed.
