In order to remain compliant with your limited company’s legal obligations, it is necessary to file your statutory accounts each year with Companies House and HMRC.
Welcome to Archimedia, statutory accounts preparation
At Archimedia Accounts, we have been providing statutory accounts preparation in Nottingham for over 16 years. We are a dynamic family-run business that will do much more than simply keep your company compliant – we set out to actively save you as much tax as possible to boost your company profits and your own personal wealth.
Contact us today to find out more about our services.
What are statutory accounts?
Statutory accounts are financial documents that are prepared and presented annually to HMRC and Companies House, plus shareholders. They provide an accurate insight into a company’s financial performance and are used to assess whether a business is trading profitably and is able to meet its current and future obligations.
Are the terms “accounts preparation” and “statutory accounts” the same thing?
The terms “accounts preparation” and “statutory accounts preparation” are used interchangeably but technically have different meanings. Accounts preparation is a service used to create a set of accounts for the business to aid commercial decisions. “Statutory accounts” refers to the accounts that are prepared according to the requirements of HMRC and Companies House.
Statutory accounts format
Statutory accounts are essentially a normal set of annual accounts that have then been “buffed up” with all the necessary compliance requirements needed by HMRC and Companies House. They must be prepared and presented in accordance with the relevant accounting standards, either International Financial Reporting Standards (IFRS) or New UK Generally Accepted Accounting Practice (UK GAAP).
The information presented in the statutory accounts includes details about a company’s sales, profits, assets and liabilities. The main components are:
- A cash flow statement – a summary of cash in and out of the business over the financial year (only required if the company is classed as “medium sized”)
- A profit and loss report – revenues and expenses over the financial year
- A balance sheet – what the company owns (assets) and owes
- Director’s report – a statement from the directors on the financial state of the company (large companies only)
- Notes to the accounts – notes that clarify the figures and detail the assumptions made by the accountant
- Auditor’s report – you may be required to have your annual accounts audited, depending on the type of business, or if 10% of your shareholders request one
Statutory accounts must be submitted to HMRC in iXBRL format and attached to the corporation tax return.
Statutory accounts – key differences
The figures from your regular company accounts will often have to change because HMRC treats transactions differently than is “natural” to the people running the business. Examples of these compliance accounting treatments to the actual figures are:
- Depreciation, intangible assets (e.g. goodwill and R&D)
- Stock (though you need stock in your management accounts, HMRC may require you to treat the value of that stock differently than your management team would)
- Revenue (there is something called “revenue recognition” in accounting standards where certain rules apply for how you treat sales in the accounts when you have customer contracts)
To add to the complexity of statutory accounts, different size companies can legally file different types of accounts and still comply. Some examples here are FRS101, 102, and 103.
What accounting software can be used?
Accounting software can make the job of preparing annual accounts a lot easier and ensure more accuracy. Popular bookkeeping software includes Sage 50, Quickbooks, or Xero (our personal favourite).
Accountants use at least 2 other types of accounting software: accounts preparation software and Corporation Tax return software, to meet government requirements.
When are statutory accounts filed?
Your annual accounts must be submitted to Companies House within 9 months after your company’s financial year-end. The same deadline applies to paying Corporation Tax.
Our statutory accounts preparation service
Every accounting firm uses dynamic checklists to determine what accounting standards a company needs to comply with. Essentially we ask you a series of questions and find out as much about your company activities as possible, and then we put our data through our dynamic checklists. There are thousands of items, but once we’ve disqualified all the unnecessary ones, we can then get to work on ensuring your company complies with all of the necessary standards.
We will present your accounts and meet with you to get your approval before we submit them to Companies House and to HMRC, along with your company tax return.
We’ll ensure your company’s annual accounts are submitted on time and that you know exactly how much Corporation Tax to pay HMRC and how to pay – well in advance.
But compliance is a given – we want to save you as much tax as possible! We will get to the heart of your finances in order to help make your company more profitable and grow your personal wealth.
Contact Archimedia Accounts today
Our accountants have been preparing accounts for over 16 years, and it is second nature to us. Reach out to us to see how we can save you money on your tax bill and help you on your journey to growing your business and family wealth. Fill in our contact form, and we will be in touch.
Can I file my statutory accounts myself?
Technically you can submit your own limited company accounts, but it is advisable to use an accountant due to the complexity of accounting standards.
What is the difference between management accounts and statutory accounts?
Management accounts are produced for your management team to aid commercial decisions, and statutory accounts are produced for HMRC and Companies House.
Both types of accounts contain a profit and loss account and a balance sheet. You may also want to include a cash flow statement and financial forecasts in your management accounts.
Are annual accounts the same as statutory accounts?
The term “annual accounts” is often used to mean “statutory accounts”, but technically they are different. Annual accounts could mean annual management accounts that are used for the running of the business, whereas statutory accounts mean accounts the company is required to submit to HMRC and Companies House, and they are produced according to accounting principles.
Is year-end accounting the same as statutory accounting?
Year-end accounting is not the same as statutory accounting. Though the terms could be used interchangeably, technically, the term year-end accounting could be used to mean the production of annual management accounts used to run the business.
Statutory accounting is specifically the production of statutory accounts, which are accounts prepared in accordance with accounting standards and submitted to HMRC and Companies House.
What is meant by “accounting standards”?
The format of your statutory accounts must meet either the International Financial Reporting Standards (IFRS) or New UK Generally Accepted Accounting Practice (UK GAAP). For most UK SMEs, the latter is the best choice.