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An explanation of Management Accounts and how to overcome common challenges
If you manage your financial books in-house, you will need to know about vital processes like Management Accounts. And like many processes within accounting, it involves a little strategy, some streamlining, and a lot of reporting.
What is the Management Accounts process?
`Management Accounts` are a set of financial statements which help businesses to verify and adjust figures and balances at the end of a designated period – whether weekly, monthly, or yearly. The purpose of the Management Accounts process is to enable the production of frequent reports explaining the financial position of the business to senior managers, investors, regulatory bodies, and so on.
Which financial statements are included in Management Accounts?
Typically, the financial statements you need to include are:
- Profit and loss account
- Balance sheet
- Cash flow statement
- A digestible report
If there are more applicable to your business, your accountant will be able to advise you.
Challenges of preparing your Management Accounts
Management Accounts is a famously nerve-wracking process, especially for businesses that are experiencing challenges directly reflected in their total balances. Here are just some of the challenges you may experience in the lead up to the Management Accounts process:
- Struggling to consistently close your books on time
- Interruptions caused by technology
- Issues with your private equity
- Pressure to tighten profit margins
- Pressure to deliver numbers faster
- Presenting numbers in a clear format
Overcome your Management Accounts challenges in one step
If you are having difficulty with the Management Accounts process – whether yours is monthly, or yearly – just know that you have the option to seek help from a reputable accountant. At Harris Lacey and Swain, our accountants have decades upon decades of experience in Management Accounts, and we now use cloud-based tools which enable us to streamline processes further!
