What should management accounts include?

I would normally expect to see a profit and loss account and balance sheet, with cash information alongside them. Depending on the business, it may also include aged debtors and creditors, cash forecasts and selected KPIs.

Current figures should be compared with something meaningful: previous months, the same period last year, budget or forecast. A �20,000 profit means very little until you know what you expected and what changed.

Good management accounts highlight the numbers that actually drive performance � perhaps gross margin, labour cost, utilisation, average order value, debtor days or revenue by service. More pages do not automatically mean better reporting.

The pack should help answer 'so what?'. Commentary and a regular review turn financial statements into decisions about pricing, costs, recruitment, cash and growth.