Requirement to Produce Accounts
Most businesses are required to produce a set of accounts at least once per year. These accounts will form the basis for the tax return which tells HMRC how much tax is owed.
Benefits of Reviewing Accounts
Aside from accounts being a requirement, as a business, you can benefit greatly from carefully considering the information within your set of accounts. Accounts can tell you how well your business is doing and may highlight areas that need to be addressed.
Identifying Areas for Improvement
For example, if you sell products or offer a service and your accounts show that your margins are too slim, you may decide to increase your prices or negotiate harder with your suppliers to increase profit and keep your business healthy.
The Value of Good Accounts
This is just one example from among hundreds or possibly thousands of why a good set of accounts can help both you and your business. There is a vast amount of information contained within a set of accounts that can be utilised to improve your business.
Frequency of Account Production
Accounts can be produced as frequently as you need them. So, if you require frequent up-to-date information about the performance of your business, then monthly management accounts will possibly be best suited for you. However, if your business is very small and you have a rough idea of how well you are doing, then you may only want the statutory annual accounts.
Importance of Professional Account Preparation
It is nearly always better for a professional to produce your business’ accounts because an accurate and comprehensive set of accounts will be of much more use to both you and your business, and will ensure that you are paying the correct amount of tax to HMRC.
