What happens if I don’t have management accounts?
Successful businesses are only as strong as their strategies. Monthly management accounts can provide a business with a detailed breakdown of exactly how their organisation is performing – enabling them to set targets, foresee problems and shape a perfect business strategy.
Naturally, a business with little knowledge of its strengths, weaknesses and how it is performing on a daily basis will struggle to react appropriately to any unforeseen challenges which may arise.
Equally, without a sufficient overview of the ins and outs of its cash flow, the business could be at risk of missing the warning signs of any problems until it is too late.
This is why management accounts are so important – they ensure businesses are always armed with the right information to help them react in the right way at the right time.
What should a good set of management accounts include?
A strong management pack should include all kinds of information, such as:
- Profit and loss reporting.
- Balance sheets.
- Cash flow statements.
- Forecast revisions, key performance measures.
At first glance, many businesses that are unaware of the importance of management accounts will dismiss them as non-essential. But in reality, being confident in your decision-making capability at all times is the key to running a successful, flexible business – which is why management accounts should never be overlooked.
Management accounts are like a monthly “health check” for businesses – the information they provide is crucial for keeping on top of cash flow.
They can also be a huge benefit to businesses that are interested in disposals, or mergers and acquisitions, as businesses looking at expanding, selling or moving premises can compare monthly management accounts in order to assess the viability of such actions.
What’s more, management accounts can also be offered up to finance providers by businesses who are trying to obtain funding.
How can we help?
Sound financial planning and strategic focus is the solution to success.
Working with businesses of all sizes from start-ups to multi-million pound organisations, we tailor our service to your requirements, providing a complete financial management service, allowing you to focus on running your business.