Using Accounting Software

2. Completing Statutory Returns

Automatic book-keeping makes it easy to prepare statutory returns and annual accounts.

2.1 Using appropriate accounting software should simplify and speed up the preparation of VAT returns.

2.2 The software will make it much easier for you to deal with HM Revenue & Customs.

• You should be able to produce a statement showing profits (or losses) for the year to date.
• You should also be able to produce a profit forecast for any period (see 4). Use this information to estimate how much tax you will owe.
• Use your cashflow forecast to show when the tax bill will arrive, and whether you will have the cash to pay it.

2.3 Some accounting packages can automate tax and VAT returns.

• You might be able to print off pre- or partially-filled return forms.
• The software might be able to send your return to HMRC automatically.

2.4 Using accounting software should allow your accountants to prepare your year-end accounts quickly and easily.

• Many companies are obliged to have their accounts audited, so it makes sense to take your accountants' advice on the selection of accounting software. Your software must be able to maintain a satisfactory audit trail.
• All accounting software should be able to produce a profit and loss account, summarising the performance for the year. Check the software can also provide information for any explanatory notes you want to provide with your returns.
• Any accounting software should be able to produce a balance sheet summarising assets and liabilities.