Audit and Accountancy

Management Accounts

The accounting needs of any business will vary according to its size, type and sector. As the business owner, it's your responsibility to make sure your business keeps accurate records and accounts. Management accounts are aimed at helping you to plan your business and make decisions about key areas such as sales, margins and stock. Management accounts are invaluable in helping you to make timely and meaningful management decisions about your business such as:

  • the sales process - including pricing, distribution and debtors
  • the purchasing process - including stock records and creditors
  • a fixed asset register
  • employee records.

Management accounts will enable you to:

  • compare your accounts with original budgets or forecasts
  • manage and focus your business more effectively
  • identify trends in your business
  • highlight variations in your income or spending which may require attention.

They should be used for planning, control and decision making

  • using cost information for pricing, capital investment and marketing
  • evaluating market and product profitability
  • evaluating the financial effect of strategies and plans.

There is no legal requirement to prepare management accounts but it is hard to run a business effectively without them and most companies produce them regularly, say monthly or quarterly. Management Accounts ensure that you are getting the appropriate management information and feedback to make the right decisions and choices as to the best way forward for your company.


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