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A well-designed chart of accounts leads to solid financial decisions. Our Chart of Accounts Procedure provides the method for assignment and maintenance of the company chart of accounts in order to produce meaningful financial data for your company.
The Chart of Accounts Procedure facilitates the record-keeping process for accounting, and it applies to all general ledger accounts. (12 pages, 2,442 words)
The Standard Chart of Accounts For Small Business Procedure covers design and description of accounting accounts. For example, design of accounts describes how income and expense accounts will 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 according to the department that is accountable for the cost and the nature of the cost. Unassigned number sequences should be left open within each group of accounts to provide for additional accounts, which may be added later.
A description of each account advises that 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. For training and consistent transaction coding, as well as to help other non-accounting managers understand why something is recorded as it is, each account should be defined. Definitions should be concise and meaningful. One or two sentences of definition are usually sufficient.
Chart of Accounts Responsibilities:
The Controller is responsible for monitoring and approving changes to the company’s Chart of Accounts.
Chart of Accounts Definition:
Chart of Accounts – A categorized listing of all account titles and numbers being used by an organization to track income, expenses, assets, equity, and liabilities is called a Chart of Accounts.