The key points to your Profit & Loss Account

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The above Chart courtesy of Big Red Cloud highlights the key points you need to be aware of when preparing & studying your Profit & Loss Account.
Most SME only see the above Account once a year, when your Accountants have completed their work.
Given the demands of running a modern business, and controlling the costs of same I feel that SME’s need to be preparing P&L Accounts ( Management Accounts ) on a more regular basis e.g., two-monthly to coincide with your VAT Returns, or indeed monthly if your turnover is in excess of €20k per month.
Preparing regular P&L Accounts (Management Accounts) will help the business to focus on Sales, Cost of Materials, Wages & general expenses, and create efficiencies in the overall operation of the business.
Regular Financial information will also allow the business to make adjustments in a timely manner, and thereby reduce the risk of incurring serious losses at the end of a 12 month period.

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