Management Accounts

Unlike statutory accounts, management accounts have no required format and are not published. They are designed around what managers need, such as results by product, region or department, comparisons with budget and last year, cash forecasts and key performance indicators.

For example, a restaurant group might produce monthly management accounts showing sales, food costs, staff costs and profit for each restaurant, compared with budget, so managers can spot problems quickly.

Because speed matters more than perfect precision, management accounts may use estimates and simplified methods. They often include non-financial measures, such as customer numbers or staff turnover, and commentary explaining the main movements.

Management accounts are the core output of management accounting, which focuses on planning, control and decision-making rather than external reporting. Lenders and investors in private companies sometimes ask to see them, because they give a more timely picture than annual statutory accounts.