What are statutory accounts?

In practice, in the UK

Statutory accounts are built to a company-law standard rather than a tax one, and the accounting framework used — full FRS 102, the reduced disclosure regime within FRS 102, or the micro-entity regime under FRS 105 — depends on the company’s size, not on how it chooses to present itself. The accounts filed at Companies House are not always identical to the accounts a company keeps internally or shares with its bank: a small or micro company can file an abridged or filleted version that omits some of what the full accounts contain, most often the profit and loss account. Statutory accounts also feed directly into the Corporation Tax computation, so decisions made in preparing them — depreciation policy, provisions, accounting estimates — have consequences well beyond the accounts themselves.

In Odoo

Odoo produces the trial balance and underlying ledger that statutory accounts are built from, and its standard financial reports can be mapped to the balance sheet and profit and loss formats company law expects. The accounts as filed, with their required notes and disclosures, are usually finalised outside Odoo in accounts-production software, using Odoo’s figures as the starting point rather than the finished document.

Common mistakes

• Filing the same version of the accounts at Companies House as the one shared internally, when a smaller company is entitled to file less.
• Treating the accounting framework as a fixed choice rather than something that can change as the company grows or shrinks.
• Finalising statutory accounts without checking that the figures reconcile to what will go into the Corporation Tax computation.