What reports should I review each month with my accountant?

Successful businesses do not just look at their numbers once a year at tax time. Regular financial reviews help you spot problems early, plan ahead, and make informed decisions. Meeting with your accountant every month gives you the chance to see how your business is performing and where you can improve.

Monthly reporting turns your accounts into a management tool rather than just a compliance requirement. It helps you understand your cash position, profit margins, and overall financial health.

This article explains the key reports you should review each month with your accountant and why each one matters.

1. Profit and loss statement (income statement)

The profit and loss statement, also known as an income statement, shows how much your business has earned and spent over a specific period. Reviewing it monthly helps you understand whether your business is profitable and which areas are driving revenue or causing losses.

It includes:

• Total income and sales.

• Cost of goods sold.

• Operating expenses.

• Gross and net profit.

Discuss with your accountant how your figures compare to previous months or budgets. Identifying trends in income or costs helps you take action early to control spending or boost sales.

2. Balance sheet

The balance sheet provides a snapshot of your business’s financial position at a particular date. It shows what your business owns (assets), what it owes (liabilities), and what is left over for shareholders (equity).

Regularly reviewing your balance sheet helps you:

• Monitor assets like cash, stock, and equipment.

• Track liabilities such as loans and supplier balances.

• Ensure your business maintains a healthy level of working capital.

Your accountant can explain how to interpret key ratios, such as your debt-to-equity ratio or current ratio, to assess your financial stability.

3. Cash flow statement or cash flow report

Profit does not always mean good cash flow. The cash flow statement shows how money moves in and out of your business each month. It separates cash activity into three categories:

• Operating activities (day-to-day business income and expenses).

• Investing activities (purchases or sales of assets).

• Financing activities (loans or capital contributions).

Regularly reviewing cash flow with your accountant ensures you have enough liquidity to cover expenses, taxes, and payroll. It also helps you plan for future purchases or unexpected costs.

If your cash flow is consistently tight, your accountant can suggest strategies to improve it, such as speeding up customer payments or renegotiating supplier terms.

4. Aged receivables report

The aged receivables report lists all unpaid invoices owed to your business, broken down by how long they have been outstanding (for example, 0 30 days, 31 60 days, or more than 90 days).

Reviewing this report each month helps you:

• Identify late-paying clients.

• Follow up on overdue invoices.

• Improve credit control and cash flow.

Your accountant can help you set up reminders or payment systems that make it easier to collect debts promptly.

5. Aged payables report

Just as you need to track money owed to you, it is equally important to monitor what your business owes to others. The aged payables report shows outstanding bills to suppliers and how long they have been unpaid.

This report helps you manage outgoing payments, avoid late fees, and plan cash flow. It also highlights if you are paying suppliers too quickly, which could strain cash reserves unnecessarily.

Your accountant can help you schedule supplier payments strategically while maintaining good relationships.

6. Budget versus actual report

The budget versus actual report compares your planned income and expenses (the budget) against what actually occurred.

This report is vital for understanding whether your business is performing in line with expectations. It shows where you are overspending or underperforming and helps you adjust forecasts for future months.

Your accountant can help analyse the variances, determine whether they are temporary or structural, and recommend ways to bring your business back on track.

7. Key performance indicator (KPI) summary

KPIs are the metrics that measure your business’s success in achieving its goals. The right KPIs vary depending on your industry, but common ones include:

• Gross profit margin.

• Customer acquisition cost.

• Average transaction value.

• Sales conversion rate.

• Debt-to-income ratio.

Your accountant can design a KPI dashboard that tracks these metrics monthly, giving you a clear picture of how your business is performing beyond the headline profit figures.

8. Tax and compliance updates

Each month, it is worth checking your position regarding VAT, PAYE, and Corporation Tax. Reviewing these with your accountant ensures you:

• Set aside the right amount for upcoming tax bills.

• Submit returns on time.

• Avoid penalties and interest charges.

A proactive accountant will alert you to upcoming deadlines, tax-saving opportunities, and changes in HMRC regulations that could affect your business.

9. Cash forecast or forward-looking projections

In addition to reviewing past performance, it is useful to look ahead. A cash forecast or financial projection estimates your expected income, expenses, and cash position for the next few months.

Your accountant can use this to identify potential shortfalls or funding needs before they become problems. It also helps you plan for growth, such as taking on new staff or buying equipment.

10. Sales and margin analysis

If your business sells products or services, a sales and margin report shows which items or clients generate the most profit. This helps you focus on the most profitable areas and consider price adjustments where margins are thin.

Your accountant can highlight trends, seasonal patterns, and customer behaviours that impact profitability.

How to make the most of monthly reviews

To get maximum value from your monthly meetings with your accountant:

• Review reports before your meeting so you can prepare questions.

• Focus on trends and areas that need improvement.

• Ask for plain-English explanations if figures are unclear.

• Use the insights to make actionable business decisions.

These meetings are not just about numbers—they are an opportunity to shape strategy and make your business more resilient.

The bottom line

Regular financial reviews are essential for small businesses that want to grow sustainably. By meeting with your accountant each month to review reports such as the profit and loss statement, cash flow, and aged receivables, you gain a clear understanding of your business’s health and direction.

A proactive accountant will not only provide these reports but also interpret them for you, offering insights and recommendations that help you plan, save tax, and improve profitability.

Consistent monthly reviews turn accounting from a compliance task into a valuable management tool that keeps your business financially strong and future-focused.