Skip to main content
WAAccountingSyllabus dot point

How does the Statement of Changes in Equity reconcile the opening and closing equity of a company across each component?

Prepare a Statement of Changes in Equity showing movements in share capital, retained earnings and reserves, reconciling opening and closing balances of total equity

WACE Year 12 Accounting and Finance Unit 3 on the Statement of Changes in Equity: reconciling share capital, retained earnings and reserves from opening to closing balances, including profit, dividends, share issues and reserve transfers in a company.

Generated by Claude Opus 4.76 min answer

Reviewed by: AI editorial process; not yet individually human-reviewed

Have a quick question? Jump to the Q&A page

Jump to a section
  1. What this dot point is asking
  2. What the statement does
  3. Which movement goes where
  4. Reconciling total equity

What this dot point is asking

SCSA wants you to set out the statement in columns, post each movement to the right component, and reconcile opening to closing total equity.

What the statement does

The Balance Sheet shows equity only at a single point in time. The Statement of Changes in Equity is the bridge between two balance sheets, showing every reason equity rose or fell during the year.

Which movement goes where

Reconciling total equity

Adding the closing balances of all columns gives closing total equity:

Closing equity=Share capital+Retained earnings+Reserves\text{Closing equity} = \text{Share capital} + \text{Retained earnings} + \text{Reserves}

This figure must equal total equity on the Balance Sheet and equal opening equity plus profit, less dividends, plus net share issues.