Having some funds to keep back- Retained earnings (REs) is one of the primary features of a successful business. Small businesses that are still growing need to have some funds in reserve for reinvestment so that the business continues to progress. Usually, some people choose to regard retained earnings as retained trading profits or earnings surplus because of how the money is realized. Furthermore, these extra profits on a balance sheet represent a form of equity and show the worth of a business. As a result, the way a business, especially a small business manages its retained earnings makes a difference regarding its success and failure. Therefore, if you are a small business owner, in this blog post, you will discover what REs are and how accountants can help you make the most of it.In the financial management of small firms, retained earnings are quite important. The fraction of profits that are put back into the business as opposed to being given to shareholders is represented by these earnings. Retained earnings are a great source of financing for small firms that may be applied to a variety of projects. In this post, we'll look at how small firms might use retained earnings to support long-term sustainability and growth.