What are Management Accounts?
Your year-end accounts explain what happened several months ago. Management accounts give you up-to-date information throughout the year, helping you understand performance, manage cash flow and make better business decisions.
GMS Accountants prepares clear monthly or quarterly management accounts for small businesses in Cambridge, Nottingham and across the UK. The reports are supported by straightforward explanations, so you understand what the figures mean and what action may be needed.
What can be included?
- Profit and loss report
- Balance sheet
- Cash-flow report or forecast
- Comparison against previous periods
- Actual performance against budget
- Gross profit and margin analysis
- Debtor and creditor information
- Key performance indicators relevant to the business
- Commentary on important movements
- A meeting or call to discuss the results
The exact reports will be agreed with you based on what is useful for your business.
When are management accounts useful?
- When you are unsure where the business is making or losing money.
- Cash in the bank does not appear to match reported profit.
- You are planning to recruit, invest or take on new premises.
- Sales are increasing, but margins or cash flow are getting worse.
- A lender needs recent financial information.
- You want to monitor business performance before the year end.
- You need better information before deciding how much to draw from the business.
Monthly or quarterly reporting
Monthly management accounts are generally more suitable for larger, faster-growing businesses or those with tighter cash flow. Quarterly accounts can provide sufficient oversight for smaller and more stable businesses. I can help you decide which frequency provides useful information without producing unnecessary reports.
How the service works
A simple four-stage process:
- Your bookkeeping and bank reconciliations are brought up to date.
- I review the figures and make the necessary accounting adjustments.
- Your agreed reports are prepared.
- We discuss the results, concerns and practical next steps.
This also gives you an opportunity to make clear that poor or incomplete bookkeeping may require additional chargeable work.
Management accounts versus year-end accounts
| Year-end accounts | Management accounts |
|---|---|
| Usually prepared once a year | Prepared monthly or quarterly |
| Primarily meet legal and tax requirements | Help you manage the business |
| Mainly report historic information | Highlight current trends and future risks |
| Follow a standard reporting format | Tailored to the business |
Fees depend on the frequency of reporting, the quality of the bookkeeping and the level of analysis required. After an initial discussion, I will confirm the reports to be provided, the timetable and the fee before any work begins.
