What are management accounts and do I need them?
Management accounts are internal reports, usually monthly, showing profit, cash, receivables, payables and key figures so owners can make decisions. They are not required by law, but they help you spot problems early. They do not replace statutory financial statements.
What they include
- Profit or loss for the month and year to date, against budget or last year
- Balance sheet: cash, receivables, stock, payables, loans
- Cash flow summary and forecast
- Ageing of customers and suppliers
- Key figures: gross margin, payroll cost, break-even, sales by product or customer
Why owners use them
- Decisions on pricing, hiring and borrowing need current numbers, not last year's accounts
- Banks and investors often ask for them
- Fraud and mistakes show up sooner
- Tax planning is easier when you know the profit before the year ends
Differences from statutory accounts
- They follow your own format, not a legal one
- They are not audited, and are not filed with SSM
- They may use simplified or estimated adjustments
Setting them up
- Close the books monthly
- Standardise a one-to-two page report
- Review it with your bookkeeper or accountant
- Act on variances, not just read them
They are a management tool only; the annual financial statements and any required audit remain separate legal obligations.
Legal basis
- Companies Act 2016, s.248
Sources
Applies to 2026 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- What is the difference between bookkeeping and accounting in Malaysia?Bookkeeping is the day-to-day recording of transactions: sales, purchases, payments and receipts. Accounting uses those records to prepare financial statements, interpret results and support decisions and tax filing. Good bookkeeping comes first, because accounts can only be as reliable as the entries beneath them.
- Is a Sdn Bhd legally required to keep accounting records?Yes. Section 245 of the Companies Act 2016 requires every company, including its directors and managers, to keep accounting and other records that explain its transactions and financial position. This applies even to a new, dormant or loss-making company.
- How long must a Malaysian company keep its accounting records?A company must keep accounting records for seven years after the transactions they record were completed. For tax, documents must be kept for seven years from the end of the relevant year of assessment. Use whichever period ends later.
- What documents should a Malaysian company keep for bookkeeping?Keep every document that proves a transaction: sales and purchase invoices, receipts, bank statements, contracts, payroll records, and records of assets and loans. If a transaction is not supported by a document, it is hard to defend in an audit or tax review.
- Can I keep accounting records and receipts in digital form only?Electronic records are accepted if they are complete, readable, accessible and can be converted into writing. Documents issued electronically, such as e-Invoices, can stay electronic. If you scan a paper original, the Income Tax Act says to keep the paper original as well.