Whilst sole traders aren’t obliged to submit end of year accounts, it’s a legal requirement that companies of all shapes and sizes do it on time every year. Unsurprisingly, failure to send this information or submitting incomplete accounts will almost certainly result in punishment, including fees and fines that disrupt your cash flow and growth.
Inaccurate and late reporting may also lead to an audit by HMRC that could otherwise have been easily avoided, or in extreme cases Companies House might strike you off the register. With all things considered, we’re sure you’ll agree that precise and timely end of year accounts are absolutely essential for any business.
Why are they required?
End of year accounts are crucial because company directors are not personally liable for any debts linked to the business. This means that all of the information needs to be accurate, up to date, transparent and accessible to the public through Companies House. By doing so, potential clients, suppliers, investors and employees have the option to digest all of the information they need before entering a relationship with your company.
What do end of year accounts include?
As you may have guessed, end of year accounts (also called year-end accounts) represent a company’s activity and performance during a financial year. This amounts to a lot of information even for the smallest of companies, and those with multiple staff, clients and purchases will have very busy accounts indeed.
For example, your company’s end of year accounts will include a directors’ report, a balance sheet detailing assets and liabilities, a company tax return, an account of profit and loss, and explanatory notes that provide comments on the above.
When all of this data is assembled, it provides a clear summary of your business, which enables Companies House and HMRC to act accordingly.
The role of accounting software
When you bear in mind that end of year accounts include all invoices, bills, receipts, bank transactions, expenses and payroll activity throughout an entire year, as well as thorough details of all assets and liabilities, it makes perfect sense that sophisticated technology is applied to keep track of it all.
However, modern accounting software and the training required to use it properly can prove very expensive, essentially making a deep cut in your cash flow and annual profits. That’s why outsourcing end of year accounts makes so much sense, as TreyBridge Accountants has all of the systems, software, processes and expertise ready and waiting, removing huge costs, hours of orientation and constant compliance checks from your company’s calendar.
Get in touch
Do you like the idea of having end of year accounts that will keep HMRC and Companies House happy, all while providing insight into how to grow your business? To find out more, call our Northern office on 01482 235575 or our London office on 0207 885 0605. Alternatively, you can fill in our contact form and one of our specialists will get back to you right away.