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In this blog post, we will outline the essentials of creating a profit and loss statement. This is a very important document which has helped a lot of businesses manage their overall finances. It is essentially like seeing an easy-to-read, easy-to-understand overview of your business’ financial health.
This document has the ability to summarise and generate an overview of your business’ expenses, the many different costs involved and the different sources of income your specific business has. The overall idea is to create a report which can satisfy the requirements of HM Revenue & Customs.
There is a lot of information that should be included in the statement, including a list of all transactions which the business has made including money in and out. The report should include any ‘petty cash’ transactions or other transactions which were related to the business. A list of all the income sources within the taxable period should also be present in the statement. These should be available on the bank statements from your bank.
You can use software such as Microsoft Excel to generate these reports. The benefits of this software is that there is usually different templates which can be downloaded and used. This can help you avoid having to manually create the algorithms to automatically calculate the figures.
We hope this information has helped you. If you every require professional, one to one advice, you can contact us here.