Irrespective of the formalities for the statutory compliance, having updated, comprehensive and detailed accounts statements is of the highest utility for the management and the stockholders of the company. Companies and businesses cannot just thrive without proper cashflow and profit.
Accounts at the end of the year
The Accounts and Legal Team will analyze your business requirements to identify better the accounting information you may need to run it effectively. The needs could be just for Profit and Loss Summary and Balance Sheet only or you may require highly technical management accounts, financial forecasting or many other financial statements to monitor and manage your business.
SME businesses usually inquire for what accounts should they have in the start. It is advised and recommended for all companies apart from dormant and small ones to prepare the annual accounts each year for HMRC and Companies House.
A big chunk of UK Companies fall under the umbrella of Small Business as declared by HMRC which enlists those ticking any two from the following points;
- £ 10.2 million or less of Turnover
- Balance of £5.1 or less on the Balance Sheet
- Employees not more than 50
Companies in this domain are only obliged to file a signed Balance Sheet with supporting documents by a director. Moreover, the other sub-category is for micro-businesses, but requirements are more or less the same.
Why are the Statutory Accounts important?
- Statutory Accounts help in remaining updated with the Companies House and are also critical in taking the shareholders in the loop about the performance of your company.
- Usually called as Annual Accounts, are actually the facts and figures you need to mention in the document. Also, it will help you in evaluating your competitor’s performance if you know the trick.
- A Balance Sheet, Profit and Loss Account, Notes and the director’s reports are the primary components of a company accounts.
- You must file your first accounts 21 months after the registration of your company with the Companies House.
- Afterwards, you will need to file it nine months at most after the end of the Financial Year.
- Filing late will result in a fine up to £ 1500, which may vary as per the period of delay.
Deciphering the accounts
Preparing and making the company accounts seems a bit too technical. But once the statements are ready, management should interpret and learn the art of analyzing. However, incomes and profits are essential and ideal as well, but there is a lot to look at. Businesses giving deserved attention to financials always have a higher of Success.
Besides the profit and loss statements, you analyze a lot more from the company accounts. You can observe the ground realities with regards to strengths and weaknesses and prepare yourself for the near future. Knowing the Company Accounts inside out is the pro-active and the recommended approach.
We organize workshops and training pertaining to the development of this financial literacy and the software, which keeps recording the information.
Why Profit and Loss Summary?
- Although as a small company, you are only required to file the Balance Sheet, you can’t make it alone. You will have to come up with Profit and Loss Accounts in the first place.
- Profit and Loss Summary consists of nothing but the details about income flowing in money and the expenses flowing the money out during the operations of the company.
- Adjustments are then made accordingly to company accounts.
- Financial Transactions related to taxes or such other matters are recorded in the Profit and Loss Summary, which is directly linked with both the Balance Sheet and the Cash Flow Statement.
- At the end of the tax year, our Business Consultants will help you in collecting the required information for preparing your yearly statutory. We accept your way of bookkeeping records, no matter how you process or even it is okay if you want us to produce the financial statements from scratch like bank statements and invoices.
Preparing of Year-end Accounts
After the collection of the data, you will get the first draft of the statutory accounts ready in a week time for your approval mentioning the taxes you will need to pay. Having the facility of Accounts made with calculation of your corporate tax liability will prove useful and instrumental for you to record, plan and budget for the cash flow model.
Our team will start working for preparing the “Commercial Insight” report soon after the completion of the Statutory Accounts. The report will be based on in-depth analysis, recommending the actions for better growth and profitability.
These points help our clients to design the plan for the next year while knowing the areas to focus concerning competitive edges for positive growth.