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FortisBusiness Advisory
Finance6 min readUpdated 7 November 2026

Management accounts: what they are and how to actually use them

Annual accounts tell you what happened. Management accounts tell you what is happening. This is what a useful pack contains and how to read it in ten minutes a month.

By Richard Yeo, Director, Fortis Business Advisory

Why annual accounts are not enough

Statutory accounts are prepared months after the year end, in a format designed for Companies House and HMRC. By the time you see them, the decisions they could have informed are long gone. Management accounts are prepared monthly or quarterly, for you, in a format designed to support decisions.

What a good pack contains

  • Profit and loss for the month and year to date, against budget and the same period last year
  • Gross margin by product, service line or customer group, because the average hides the problem
  • Cash position today and a 13-week cash forecast
  • Debtor and creditor ageing with named actions, not just totals
  • Three to five key performance indicators specific to your business: utilisation, wage percentage, order book, enquiry conversion
  • A half-page commentary: what changed, why, and what we are doing about it

A pack that takes longer than fifteen minutes to read will not get read. Short, consistent and on time beats comprehensive and late.

The four numbers to watch

Gross margin percentage, because it tells you whether the work is priced right. Overheads as a percentage of sales, because it tells you whether the business is carrying too much weight. Debtor days, because it tells you how fast customers pay. Cash headroom, because it tells you how long you can survive a bad month. If those four are moving the right way, most other things follow.

How to use them

Put a fixed hour in the diary each month, ideally within ten working days of month end. Read the commentary first, then the four numbers, then anything flagged. Agree two or three actions with owners and dates. Review last month's actions before adding new ones. That rhythm, kept for a year, changes how a business is run.

What it costs

Less than most owners expect, provided the bookkeeping is current. The expensive part is reconstructing six months of books before the pack can be produced. Fix the bookkeeping first, then the pack is a modest fixed monthly fee.

Want this done for you?

Everything in this guide is work we do for clients every month. A thirty-minute conversation will tell you whether it makes sense for your business.

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