One thing that tends to be a bit of a mystery to a lot of Sage 50 users is the Chart of Accounts, so here I’m going to explain the What, Why, When & How.
What is the Chart of Accounts?
The Chart of Accounts (or COA) is the area of Sage where you configure how your Sage Profit & Loss and Balance Sheet ‘look’ i.e. display. What headings or labels they have, what order things appear in and what data gets pulled through.
Why do I need to use the Chart of Accounts?
Regardless of whether you’ve ever looked at the COA in Sage 50, every time you print off your Profit & Loss and Balance Sheet in Sage 50, the program is referring to the COA to understand how you want the data to display. Your COA must contain every nominal code that exists within your Sage program to ensure it is ‘complete’ and not ‘partial’ (incomplete). It’s also essential your COA is reviewed before you run a year-end, as (in technical terms!) it ‘scoops’ up all the P&L balances from your COA configuration and ‘dumps’ them (again, no accounting jargon here!) on your Balance Sheet in the reserves.
When should I check my Chart of Accounts?
If you’ve never looked at your COA or your P&L and Balance Sheet really aren’t displayed how you’d like, you should review and amend your COA and then every time you add a new nominal code, check it to make sure it is complete. It’s also good to get into the habit of checking your COA before you produce any financial reports and run your year-end in Sage.
How do I check my Chart of Accounts?
If you go into your Nominal Codes module, along the top you will see a Chart of Accounts option (or COA depending on the version of Sage you are using). There will always be a layout called ‘Default Layout of Accounts’ and you may have others that you or others have added. Highlight the description and then click ‘Edit’, this will launch the editor and from here you can amend the Profit & Loss and Balance Sheet tabs as needed.
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Any advice relating to accounts or tax should be sought from your tax accountant. Sage Accounts Solutions Limited will not be held responsible for any loss or damage caused as a result of the information contained herein.