Statutory Accounts Services Manchester
Our team of professionally qualified accountants are experts in preparing statutory accounts for all types of business – from small to large and single shareholder to Limited Liability Partnerships.
At Quay Accountants we offer a seamless statutory accounts service that will not only put your mind at ease, but is guaranteed to satisfy the needs of shareholders, Companies House and HMRC alike.
What are statutory accounts?
Statutory accounts (also called annual accounts or year-end accounts) are financial statements that all UK limited companies are legally required to prepare and submit to Companies House after the end of each financial year.
Once prepared, statutory accounts get sent to shareholders, Companies House and HMRC. The purpose of annual accounts is to ensure that your company records remain up-to-date with Companies House and to also demonstrate the performance of your company to shareholders.
What needs to be in the statutory accounts?
Statutory accounts must include a directors report, an income statement (profit and loss statement), a statement of financial position (balance sheet), and notes about the accounts, along with a cover page, contents, and a company information page.
Company Information Page
This page contains basic information about your company such as your company name, company number, your registered office address, and the names of all directors and your accountant.
The information in the Director’s Report helps shareholders to understand key details of your business, such as the names of each director, the main business activities, and whether the company’s finances are in good health.
The Directors’ Report is also used as an opportunity to explain the financial performance and business conditions that have affected the company’s balance sheet.
A Directors’ Report does not need to be included in the statutory accounts of companies who fulfil at least two of the following conditions:
- the turnover is less than £10.2 million
- the balance sheet is less than £5.1 million
- there are fewer than 50 employees
The Balance Sheet
The balance sheet, also known as the Statement of Financial Position, gives you a snapshot of your company’s financial health at the end of the accounting period (Financial Year).
The balance sheet shows you the companies:
- Assets (the things the company owns, including cash)
- Liabilities (the things the company owes to other people)
- Equity (retained earnings plus the funds you originally invested as shareholders)
In a nutshell, it shows you what the company is worth on paper right now, based on the current numbers in your accounts.
The balance sheet is helpful for:
- Assessing the current financial position of the company
- Providing evidence of your financial position to banks, lenders and investors
- Giving potential buyers an idea of the company’s tangible net asset value, if you plan to sell up
Profit and Loss Account
Your profit and loss statement is commonly called your P&L, but is also referred to as your income statement or statement of earnings.
It’s a full breakdown of your company’s revenue (money coming into the company as sales and other business income) and your expenditure (direct costs, overheads, expenses, and other costs).
As a business, you obviously want to turn a profit and make money from your venture. Careful observation of your P&L allows you to track your revenues and expenses over a set period of time. You can then look back over the period and see exactly where you’re making money, and where you’re losing money.
The more you make, and the less you lose, the greater your profits will be at year-end – and your P&L is your barometer for measuring these metrics.
The P&L statement is good for:
- Giving you a breakdown of all revenues and relevant costs and expenses
- Showing the profit and loss figures over a set period of time
- Summing up your profit and loss for the period to gauge if you’re profitable
Notes about the accounts
The notes section in statutory accounts, details and comments on the numbers that are presented in the balance sheet and profit and loss account.
The financial year notes also include a statement on the accounting principles and the facts that can have an impact on how a viewer can interpret the accounts.
Statutory Accounts - Frequently Asked Questions
Who needs to complete statutory accounts?
All limited companies in the UK are legally required to complete annual accounts and submit these accounts to Companies House.
When do statutory accounts need to be submitted to companies house?
Your first company accounts will need to be filed 21 months after the company was registered with Companies House. After that, you will need to file your company's annual accounts within 9 months of your company's financial year-end.
What happens if I miss the statutory accounts deadline?
You'll automatically receive a fine for filing your accounts after the deadline. Depending on how long the delay is, this could be up to £1,500 or your company could even be struck off the register.
What is the difference between management and statutory accounts?
Statutory accounts are required by law to be submitted, whereas management accounts are not. Management accounts are prepared more regularly than annual accounts and give business owners the opportunity to review their businesses performance, identify improvement opportunities and and see whats driving their numbers by monitoring trends.
At Quay Accountants, we offer both of these services and can help you to make sense of your numbers to drive your business.
Do statutory accounts have to be audited?
Not all companies or organisations require a statutory audit. Small companies are usually exempt, unless they are are in a regulated industry sector (such as financial or legal services), are part of a charity organisation or are members of a wider group.
To be exempt from a statutory audit, you must fulfil two out of the three criteria below for two consecutive years (or its first year for new companies):
- Turnover should not exceed £10.2m
- The balance sheet total should be less than £5.1m
- The average number of employees should be no more than 50
That said, you may still be asked to undertake a statutory accounts audit if a stakeholder or lender requests it.
It is also not unusual for some small companies to request an audit in order to gain confidence in their financial reports, or if they are planning on selling their business in the future.
Why outsource your statutory accounts preparation to Quay Accounting?
Compiling statutory reports and keeping up with the latest legislation can be time consuming, leading to a strain on time and resources, especially for SMEs.
That is why many limited companies choose to outsource their statutory accounts to Quay Accountants.
Our highly experienced team are on hand to not only prepare and file your financial documents, but to provide you with support that will make your future financial reporting seem effortless.