Have you opted for a limited company as your business structure? If so, you must know that a registered company is under the obligation of preparing annual accounts every year in the UK. Are you wondering about can I prepare my limited company accounts? Well, it depends what is the size of your company. Because expanded the business, the larger your company will be. In the case of larger companies, the financial and business activities are complex.
You may want to handle the bookkeeping and accounting obligations of your business all by yourself, however, most people seek professionals who can do the job more efficiently. Whether you decide to do the job yourself or to hire a professional, it is vital to have an understanding of the accounting obligations of your company. This will ensure that the business is going smoothly as well as the role of a director will be fulfilled as well.
Can I Prepare my Limited Company Accounts?
You need to have an understanding of what are annual accounts in case you have chosen to do the bookkeeping yourself. Financial accounts are considered same as the annual accounts. So as the company accounts and the statutory accounts. This means that you are obliged to provide a summary of the financial activities of your business within the time of 1 year. The record of annual accounts involves the following:
- Financial health at the end of the year.
- What is the operational performance of the business?
- Details of the transactions of the company.
- Financial Statements
Moreover, the limited companies have to provide annual accounts to HMRC, companies house, holder of company debentures, guarantors, shareholders, and the individuals who are allowed to attend general meetings. The annual accounts have the details related to the auditor’s and director’s reports, profit and loss, balance sheet, and supporting notes.
In the case of small companies, they are permitted to prepare simple accounts only. You need to know the following requirements to be prepared at the time of annual accounts in case you are preparing them on your own.
The Report Of The Auditor
This report is prepared by an external auditor or qualified chartered accountant. This ensures that an independent evaluation of the finances is done and the annual accounts are made including the fair opinion of the auditor’s report. The report should include the following:
- Liabilities of the director and auditor.
- Standard of accounting practices
- Fair financial statements
- The financial health of the company
The Report Of The Director
The board of directors tend to prepare this report. This is an important part of the annual accounts. In the case of small companies, they are not bound to submit this report. A few mandatory information required in this report include the following:
- All director’s basic information like the names
- Performance of the company in the industry
- The financial health of the business
- Plans for future business developments
- Set of rules for business activities
Notes to the Accounts
Any information that is added to support the annual accounts is considered as noted to the accounts. Some of them are asked by the law. However, the majority of such points are added to support the points of the report. To make the point home and understandable.
The Statement of Business of Profit and Loss
The usual period is 12 months. The company is required to give details of all the transactions that happened in this duration. This will clear the statement of business loss and profit further. This will include the VAT, corporation tax, pension, wages, loan, interest, sales, and business expenses.
The Balance Sheet
We all know that the balance refers to a snapshot of the business details that include the information of equity, shareholders, liabilities, and assets at the year-end. This also gives information about what the business owes to others and who owes the amount of money to your business. This is taken as a kind of indication of the financial position of your business. So this is considered an important part of the annual reports.
The Bottom Line
Now that you have gathered a fair amount of information about ‘can I prepare my limited company accounts, we can sum up by saying that it is a complex process to prepare the company accounts. This is why the majority of people tend to seek professional help to prepare them. However, in the case of small businesses, the task is a little simpler in comparison to expanding businesses.
You can make your choice and we hope these few minutes of reading have helped you to do the job in a seamless way.
Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions quickly. Call us or email us today.
Disclaimer: The general information provided in this blog about Can I prepare my limited company accounts includes its text and graphics. It does not intend to disregard any of the professional advice.