Statutory accounts are a set of financial reports prepared at the end of each financial year. All private limited companies are required to prepare these annual accounts to report the performance and financial activity of businesses.
These reports are mandatory for all limited companies and will be requested by HMRC – and may also be included as part of contracts for shareholders. Companies House requires annual accounts within nine months of your year-end, or within 21 months of the first registration date if it’s your first return. Annual accounts are also used to work out corporation tax.
What is included in statutory accounts? Find out more here…
Statutory Accounts Preparation
Annual accounts must include:
- A profit and loss statement which details the business’s net profit or loss from sales and running costs.
- A balance sheet which shows how much the company owes is owed and owns at the end of the financial year.
And for larger businesses:
- A director’s report produced by the board of directors and outlines the financial state of the company covers whether the company has the capacity to expand, and determines how well the company is performing within its market.
- An auditor’s report that features an opinion on the reliability and validity of the company’s financial statements, a management report, any reservations and additional information, and a final conclusion.
Bear in mind that if you file your accounts one month later than the deadline, you’ll be fined £150. Up to three months delay will cost you £375, six months £750, and more than six months postponement will incur costs of £1,500.
Small Company Procedures
Both small companies and micro-entities can use an exemption to make it unnecessary to provide audited accounts and can choose whether a copy of the profit and loss account and the director’s report is submitted. Small companies are classed as those with two or more of the following:
- A turnover of £10.2 million or less
- £5.1 million or less on the balance sheet
- Less than 50 employees
Micro-entities is the name given to small companies that have two or more of the following specifications:
- A turnover of £632,000 or less
- £316,000 or less on the balance sheet
- Less than 10 employees
Get Help From the Professionals
You can do your own accounting for your limited company, including preparing and filing your statutory accounts. However, a trusted outsourced bookkeeping service provided by specialist tax accountants in London will take away any stress.
Your statutory account service will include proficient preparation, submission of annual accounts and tax returns to HMRC and Companies House within deadlines, and advice on any updates to legislation, alongside information on accounting standards revision.
VAT return services are just one of the facilities that will ensure an accurate setup of your account and the input of VAT calculations at the right time. Your reports will be filed on your behalf if you wish – making the preparation and submission of your statutory accounts as straightforward as it can possibly be.