Managing Accounts

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Managing Accounts

Overview of the Chart of Accounts

Establishing a Numbering Scheme for Your Accounts

Defining Account Segments

Creating Accounts

Attaching Files to Your Accounts

Setting Up Account Groups for Reports

Setting Up Account Classifications for Reports

Editing Accounts

An accounting system uses accounts to track the financial condition and movement within an organization. Whenever money moves, it is recorded to show a decrease in one account and an increase in another. Whenever money is taken from an account, you need to record the movement.

Example: Tracking Financial Movement Between Accounts
If a business wants to keep track of utility expenses, they might create an expense account in General Ledger. Then they record additions to that account when money is taken from the checking account to pay the utility bills. Another account might be a mortgage. Whenever the mortgage is paid, money moves from the checking account to the mortgage account. If you need to distribute these expenses between departments or locations, you can use Allocation Codes. See Distributing Money to Multiple Accounts (Allocation Codes) for information on how to set this up.

Example: Tracking Financial Movement Between Accounts

If a business wants to keep track of utility expenses, they might create an expense account in General Ledger. Then they record additions to that account when money is taken from the checking account to pay the utility bills.

Another account might be a mortgage. Whenever the mortgage is paid, money moves from the checking account to the mortgage account.

If you need to distribute these expenses between departments or locations, you can use Allocation Codes. See Distributing Money to Multiple Accounts (Allocation Codes) for information on how to set this up.

By using a detailed chart of accounts, a business is able to keep track of their current financial situation and provide a financial history for reports or taxes. A journal, or record of transactions, allows an organization to locate specific transactions if questions arise about the financial situation or if an error is found.

(Fund product only) In order for General Ledger to operate correctly, all balance sheet accounts that are asset, liability, and equity (fund balance) accounts (with the exception of due to/due from accounts) need to be duplicated for each fund.

Remember, your fund segment does not always need to be a prefix. It is also important to have an exact duplicate of balance sheet accounts for each fund, where only the fund segment is different.

Published date: 09/30/2021