The statutory accounts’ sole purpose is to report on the taxable profit of the business and then to calculate and report the corporation tax. They are formatted in a generic way so that they compare to other companies’ accounts. The profit that is shown on the profit and loss account is the official profit of the business but it may differ wildly from the management accounts profit and it isn’t even in the profit that is chargeable to corporation tax. This is calculated by taking the profit in the statutory accounts, putting through a few adjustments (adding back depreciation, entertaining and deducting capital allowances) and then corporation tax is calculated on this figure.