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