A Chart of Accounts Template is a categorized listing of all account titles and numbers being used by an organization to track income, expenses, assets, equity, and liabilities. Accounts should be arranged in the same sequence in which they appear in the financial statements. Accounts are usually defined by a unique identifier, account number, or account code and are coded by the type of account.
It is generally up to each accountant, controller, or CFO to design the chart of accounts template, unless certain standard general layouts are regulated by law. The structure of the chart of accounts template should assist in consistent posting of all transaction.
Ledgers can be easily located because each nominal ledger account in the chart of accounts is unique. The trial balance is a list of the active general ledger accounts with their respective debit and credit balances. A balanced trial balance does not guarantee that there are no errors in individual ledger entries. The list is typically arranged with the balance sheet accounts followed by profit and loss accounts.
Types of accounts include asset, liability, equity, revenue (income), expense, and contra. For more information about each of these types of accounts, visit Wikipedia.
Account codes should be numbered so that all sales amounts are recorded by either Product or Sales Territory and so that cost of sales amounts, sales expense amounts and administration and other expense amounts are recorded.
Account codes may be numbered using a four-digit sequence (An automated accounting system will generally have a predetermined account numbering format). Each account should be given a short title description that is brief but will allow the reader to quickly ascertain the purpose of the account.
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