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Setting Up the Chart of Accounts

Chart of Accounts

The chart of accounts is the backbone of your accounting system. Go to Accounting > Configuration > Chart of Accounts.

Account Types

Type Normal Balance Financial Statement Examples
AssetDebitBalance SheetCash, Bank, Accounts Receivable, Inventory, Fixed Assets, Prepaid Expenses
LiabilityCreditBalance SheetAccounts Payable, Loans, Credit Cards, Accrued Liabilities, Deferred Revenue
EquityCreditBalance SheetOwner's Capital, Retained Earnings, Current Year Earnings, Drawings
IncomeCreditProfit & LossProduct Sales, Service Revenue, Interest Income, Discounts Received
ExpenseDebitProfit & LossCOGS, Salaries, Rent, Utilities, Depreciation, Office Supplies

Creating an Account - All Fields Explained

Field Model Field Required Description
CodecodeYesNumeric code (e.g. 1000). Determines sort order in reports. Use a structured numbering system (1xxx Assets, 2xxx Liabilities, 3xxx Equity, 4xxx Income, 5xxx COGS, 6xxx Expenses).
NamenameYesAccount name displayed in reports (e.g. \"Petty Cash\", \"Sales Revenue - Products\").
Typeaccount_typeYesDetermines financial statement placement and default behaviour. Cannot change if journal items exist.
Currencycurrency_idNoLeave empty for company currency. Set specific currency for foreign-currency accounts (e.g. EUR Bank Account).
Allow ReconciliationreconcileNoEnable for accounts where transactions need matching (AR, AP, Bank, Credit Card). Disable for accounts like Rent, Sales Revenue.
DeprecateddeprecatedNoHide account from selection lists but keep existing entries intact. Used when merging/retiring accounts.
Tagstag_idsNoClassify accounts for reporting. Used in tax reports, deferred revenue, etc.
Groupgroup_idNoAccount group for hierarchical reporting. Groups auto-roll up totals.

Creating an Account - Step by Step

  1. Go to Accounting > Configuration > Chart of Accounts → click Create.
  2. Enter Code using a logical numbering scheme (e.g. 1100 for Checking Account, 1200 for AR).
  3. Enter Name descriptive enough for report readers.
  4. Select Type - this cannot be changed later without careful migration.
  5. Check Allow Reconciliation only when needed (AR, AP, Bank). Overuse slows performance.
  6. Click Save.

Account Tags

Tags classify accounts for specific reports. Go to Accounting > Configuration > Account Tags. Common tags:

  • Tax Report Tags - Mark accounts included in VAT/GST returns (e.g. \"Sales 20% VAT\", \"Purchases 20% VAT\").
  • Deferred Tags - Mark accounts for deferred revenue/expense automation.
  • Internal Tags - Custom classification for your own reporting needs.

Account Groups

Groups create hierarchical reporting. For example:

  • Current Assets (1100-1500)
    • Cash & Bank (1100-1200)
    • Accounts Receivable (1300)
    • Inventory (1400)
  • Non-Current Assets (1600-1900)
    • Fixed Assets (1600-1700)
    • Intangible Assets (1800)

Balance Sheet and P&L reports automatically respect the group hierarchy.

Recent Chart of Accounts Improvements

  • Account Group Import/Export - Bulk create account groups via CSV import.
  • Enhanced Search - Search accounts by code, name, or type in a single field.
  • Account Status Indicators - Color-coded badges for reconciled/bank/cash accounts.
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This documentation is updated continuously. Some features described here may be renamed, deprecated, or still being finalized.