Businesses are required by federal, state, and local laws to keep accurate accounts of their finances. Furthermore, this will provide owners and managers the helpful information to make decisions affecting the business' future. With these facts in mind, it is essential for small businesses to adhere to accurate accounting practices. A liability is any existing debt that is currently on the company's books (i.e., outstanding bills, bank loans, etc.). With management oversight, it is the task of the accountant to make sure that liabilities do not exceed assets. At year's end, the accountant must total up the monetary values of all assets and liabilities. The final number is that business' annual profit or loss. For ongoing accounting practices, a balance sheet is a permanent record of the particular business' assets and liabilities from its first day of business. In this manner, a small business' annual profit or loss and its balance sheet are comparable to our nation's federal deficit and national debt, respectively.