Financial Statements Engine

Overview

The EIN 360 Financial Statements module produces four core reports from the General Ledger, generated in real time from posted journal entries. Every number is auditable back to its source transaction.

Report	Standard	Purpose
Trial Balance	IAS 1 / IFRS	Verifies debit-credit equality across all accounts
Income Statement	IAS 1.81–105	Revenue vs expenses over a period
Balance Sheet	IAS 1.54–80	Financial position at a point in time
Cash Flow	IAS 7	Cash movements by activity category

Compliance framework

Follows IFRS as adopted by the UAE: IAS 1 (Presentation), IAS 7 (Cash Flows), IAS 16 (PP&E / Depreciation), IFRS 16 (Leases), and UAE Federal Decree-Law No. 47 of 2022 (Corporate Tax).

Architecture

Every financial transaction creates a balanced journal entry where total debits always equal total credits. This is enforced at the database constraint level.

gl_journal_entries (header)
  id, journal_date, source, description, status

gl_journal_lines (details)
  account_id → gl_accounts
  debit_amount  (always ≥ 0)
  credit_amount (always ≥ 0)

CONSTRAINT: SUM(debit) = SUM(credit)
Only 'Posted' entries appear in reports

Chart of accounts

Code range	Type	Normal balance	IFRS class
1xxx	Asset	Debit	Financial Position
2xxx	Equity	Credit	Financial Position
3xxx	Liability	Credit	Financial Position
4xxx	Income	Credit	Profit or Loss
5xxx	Expense	Debit	Profit or Loss

Automated journal sources

Source	Trigger	Debit	Credit
Invoice	Invoice issued	Accounts Receivable	Revenue + VAT Output
Receipt	Payment received	Bank / Cash	Accounts Receivable
Credit Note	CN issued	Revenue	Accounts Receivable
Payroll	Payroll posted	Salary Expense	Salary Payable
Depreciation	Monthly run	Depreciation Expense	Accumulated Depreciation
Store Sale	POS sale	Cash + COGS	Revenue + Inventory

Trial Balance

Lists all GL accounts with aggregate debit and credit totals. If total debits ≠ credits, there is a system error. EIN 360 enforces balance at the journal level, so the Trial Balance always balances.

• Balanced check: SUM(debits) = SUM(credits)
• Positive net = debit balance (Assets, Expenses)
• Negative net = credit balance (Liabilities, Equity, Income)
• Optional asOf date filter for point-in-time snapshots

Income Statement (P&L)

Measures financial performance over a period.

Revenue — for Income accounts: Credit Total − Debit Total. Income accounts have a credit normal balance.

Expenses — for Expense accounts: Debit Total − Credit Total. Expense accounts have a debit normal balance.

Net Income = Total Revenue − Total Expenses

Revenue is recognized at invoice issuance following IFRS 15’s five-step model: identify contract → identify obligations → determine price → allocate → recognize.

Balance Sheet

Shows financial position at a point in time. It must satisfy:

Assets = Liabilities + Equity

EIN 360 programmatically verifies this equation and displays a pass/fail indicator.

Contra-assets — Accumulated Depreciation accounts have a credit normal balance, creating negative amounts that reduce total assets.

Retained earnings — auto-calculated by running the P&L from inception to the balance sheet date. No manual period-end closing needed — the system performs a virtual close in real time.

Cash Flow Statement

Uses the Indirect Method (IAS 7.18b) — starts with net profit, then adjusts for non-cash items and working-capital changes.

Operating Activities:
  Net Profit + Depreciation
  ± Working Capital Changes (AR, Inventory, AP, Payables)

Investing Activities:
  − Purchase of PP&E, Vehicles, Computers

Financing Activities:
  + Capital Contributions ± Loans ± Lease Payments

Opening Cash + Net Change = Closing Cash

Data Integrity

Safeguard	How it works
Posted-only	Only journals with status = ‘Posted’ appear
Immutable	DB triggers prevent modification of posted entries
Multi-tenant RLS	PostgreSQL Row-Level Security isolates data
Real-time	No pre-aggregated tables — computed from source
Audit trail	Every journal records timestamp, user, source