Things to Include in Your Monthly Management Account

It would be a big surprise for you if someone tells you, management accounts are not mandatory! Fact is, if you are serious about growing your business, you will realise they play a vital role in helping you achieve your business goals. And there are genuine reasons to think so.

Benefits of Management Accounts

Key reasons that you will need a management account regularly:

• How well your business is doing is not easy to gauge unless you accurately measure its performance regularly. Consequently, you will have to struggle to make an informed decision on crucial factors like funding needs of your company.
• To ascertain where your business has reached performance-wise.
• Numbers are mandatory to understand the financial health of your company, which helps in allocating budgets and planning investments.

Important Information for Your Management Accounts

What you include must depend on what stage your business is in the current situation and what goals the stakeholders of your business have set for your business. Things that you must add: • Key performance indicators
• Profit & loss statement
• Cash position – inflows and outflows
• Balance sheets

Frequency of Preparing your Management Account

The management accounts are usually prepared on a regular basis, ensuring consistency in monitoring the business activities and finances with accuracy. There is no fixed rule for account management, but can be generated monthly or quarterly. Make sure you cover everything essential for your business in the account, which must be tailored to your business needs.