Certified Apartment Portfolio Supervisor (CAPS) Practice Exam - Module 1

Which financial report provides an overview of a property's financial position at a specific point in time?

1. Income Statement

2. Balance Sheet

3. Variance Report

4. General Ledger

The correct answer is: Balance Sheet

The Balance Sheet is the financial report that offers a snapshot of a property's financial position at a specific point in time. It summarizes the assets, liabilities, and equity of the property, allowing stakeholders to understand what the property owns, what it owes, and the residual interest of the owners. This is essential for assessing the overall financial health of the property. The Balance Sheet is structured to show the relationship between assets and liabilities, providing insights into liquidity and financial stability. Unlike the Income Statement, which covers a period of time and shows revenues and expenses, the Balance Sheet freezes a moment in time, making it pivotal for analyzing current financial standing. Other reports, such as the Variance Report, focus on comparing actual performance against budgeted expectations over a period, while the General Ledger serves as a comprehensive record of all financial transactions but does not present a summary like the Balance Sheet does. The Income Statement, while crucial for understanding profitability, does not provide the complete financial picture at a particular moment, making the Balance Sheet the most appropriate answer in this context.