What are management accounts?

Management accounts are regular financial reports prepared to help you run the business. They normally bring together profit and loss, balance sheet and other relevant information so you can see what has happened recently and what needs attention.

Statutory accounts are produced mainly to meet annual reporting requirements. Management accounts are produced for you, so the format, frequency and level of detail should reflect the decisions you actually need to make.

A pack of reports on its own isn't enough. The value comes from comparisons, trends and commentary: what changed, why it changed, whether it matters and what action should follow.

They become increasingly valuable when a business has staff, multiple revenue streams, tight margins, growth plans or cash pressure. In those situations the owner needs more than a bank balance and an annual profit figure.