With business growth and success in mind, regular management accounts can help provide the vital information necessary to make important decisions. They will also identify the strengths and weaknesses of a business and its processes.
Management accounts can be prepared on a monthly, quarterly or even bi-annual basis. We work with our clients to make sure that they are tailored so as to produce management’s specific information requirements.
The advantages of preparing management accounts include:
- Assisting management with making key financial decisions
- Allowing management to understand the factors that can aid business growth
- Satisfying the requirement of financiers when obtaining credit facilities
- Facilitating cashflow planning
Typical problems that we come across
- Delays – management accounts should be prepared as soon as possible after the period end. The main advantage of management accounts over statutory accounts is their timeliness and the ability they give management to make decisions in real time and not 6-9 months after the year has ended.
- Management not reactive – management sometimes is not able to interpret the accounts with the result that the opportunity for timely decision making is lost.
- Accounts do not provide relevant data for management – the information prepared may not be either adequate or relevant to management. The accounts should be short and concise and include a summary of the business’s Key Performance Indicators to allow management understand and react as necessary.
How we can Help
We have a dedicated team to whom our clients outsource the preparation of regular (monthly and quarterly) management information packs.
Working to agreed deadlines, our team assures our clients of the delivery of high quality information. In this way, they can focus their own efforts on growing and developing their businesses. Each client will have a management information pack designed to meet its own needs, incorporating relevant Key Performance Indicators delivered with a commentary that is designed to help with the interpretation of the results.
For many of our clients we will use these management information packs as the basis to update their financial forecasts. It is crucial to look forward, to anticipate any “pressure points” on cash flow and to avoid any surprises which a business may struggle to contend with.