A nonprofit's balance sheet or statement of financial position provides a snapshot of the nonprofit's financial position at a specific moment. On the balance sheet, a mortgage loan is recorded under liabilities in the long-term liabilities section. The balance sheet must reflect the then-current principal on the mortgage.

Alongside an incomes statement and balance sheets, potential stakeholders can see trends over time, check ratios and balances. It can even show places where you could put cost-cutting measures in place. The balance sheet is a way to assess your finances in a realistic manner.