OK, so I worked for five years for a firm of accountants in the City of London (Neville Russell, now part of Mazars), and I guess that gives me a head-start in understanding a set of financial accounts.
Let's take a step back. Anyone in the UK can get hold of the latest set of accounts and the Annual Return of a company from the government department known as Companies House.
My point? Employees should not look at their employer's accounts and say "they made enough money, they can afford my pay rise" - an employee expecting any more than a pay freeze in this market has their head in the clouds, frankly. And past year's trading profits do not mean that the employer has cash surpluses available for distribution.
Let's take a step back. Anyone in the UK can get hold of the latest set of accounts and the Annual Return of a company from the government department known as Companies House.
- The Annual Return gives you a list of company directors and their home address, together with a list of shareholders (and their home addresses) and their shareholdings.
- The Financial Accounts are a much more complex, and the most frequently misunderstood document is the "Profit and Loss Account" which looks at how much money they got from trading, and the costs they spent while trading - such as buying the stock, paying the staff, the light and heat bill, etc etc. But it does NOT cover how they spent cash in buying assets, and it is quite feasible that and spare cash (and more..) could have been used in buying new equipment, new group companies and so on.
My point? Employees should not look at their employer's accounts and say "they made enough money, they can afford my pay rise" - an employee expecting any more than a pay freeze in this market has their head in the clouds, frankly. And past year's trading profits do not mean that the employer has cash surpluses available for distribution.
