As a business owner you need to be on top of the business’s finances. You need to know not just how it is currently performing but also how it is projected to do in the months ahead.Management accounts are produced by a business to help with the day-to-day running of the business. They do not have to follow a standard format, nor do they need to be audited or filed with the CRO. Instead, you decide what type of financial information gets produced, how often (usually monthly) as well as what sort of charts, projections and variance or other analyses are included.Depending on a client’s particular needs we can produce Monthly, Bi-Monthly, Quarterly or Six Monthly Accounts to assist the owners in the effective running of their business.
General format of management accounts
While management accounts do not have to follow a set format, you would normally expect to see certain core items included, with other items covered in greater or lesser depth or not at all, depending on the type of business and your specific information needs.
One page Management Summary with key financial figures
P & L a/c for current month and YTD with prior year / budget comparatives
Our monthly management accounts service is specifically for business owners and senior management. This is a stand-alone service and does not require a client to change accountants – for interested business owners their current accountants / auditors can still do the annual accounts / audit / tax returns. We can of course however supply a quotation for the year end accounts / audit if required.
Management accounts is a set of summarised accounting data (balance sheet, profit and loss account, key performance indicators / statistics / comparisons) prepared and presented monthly specifically for a firm’s management. The objective of management accounts is to provide timely and key financial and statistical information required by managers & owners to make day to day and short-term decisions.
Typically a company with 15 – 60 employee’s would have good bookkeeping / office staff employed who would enter the basic transactions into an accounting package such as SAGE and would reconcile the bank and ensure debtors and creditors balances are correct. They would also normally do the VAT returns and the payroll.
Where we would come in is for an experienced qualified accountant to come in for one day or so once a month and review what the bookkeeper(s) have done, deal with any queries or issues they are having and make adjustments for items such as accruals, prepayments, stock, work in progress, bonus calculations, depreciation, loan & lease interest and repayments, purchase / sale of assets / equipment / vehicles etc. and produce an accurate profit and loss a/c and balance sheet for the month. This would be presented in an agreed format for management that may include comparatives for the same month and year to date from last year and comparatives for budgeted figures for the current year etc. If departmental or branch analysis is required that can be put in place also. It is essential to any successful business to have this information on a monthly basis.
An added benefit is that we provide ongoing back-up / support for the bookkeeping staff and of course the client – we are only ever a phone call or e-mail away for the multitude of queries that inevitably arise throughout the year. Essentially the client gets an outsourced Financial Controller for a fraction of the cost of employing one directly.