Purpose
The Chart of Accounts module serves multiple functions:
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It holds all ledger account data used for compilation of Financial Statements, both internally through TRUE Accounting and externally via QuickBooks and/or Sage Intacct Integration.
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It provides a setup section for the 'Default Chart of Accounts' options, allowing users to set predetermined ledger accounts for various source documents in TRUE (e.g., Invoices, Bills, Payments).
- It stores 'Class' data used in both TRUE Accounting and QuickBooks.
Chart of Accounts Module
The Chart of Accounts module consists of several key components:
Ledger Accounts Mode |
A list of all ledger accounts available for selection and inclusion in financial statements. |
| Default Accounts Mode | A list of various ledger accounts that TRUE will automatically set upon creating a journal entry. |
| Class Mode | Additional identifying criteria users can deploy for financial reporting. |
Groups Mode |
Groups allow for the ability to link ledger accounts and total multiple accounts on a financial statement. |
Ledger Accounts Mode
The Ledger Accounts mode displays the company's Chart of Accounts. The default list shows all active ledger accounts.
Search & Filter Options
- Quick Search: Use the search bar to search for ledger accounts by partial or full name, category, or number.
- Active: Displays all active ledger accounts.
- Inactive: Displays all inactive ledger accounts.
- Show All: Shows both inactive and active ledger accounts. Will not show previously deleted ledger accounts.
Import / Export Records
- CSV Template: Produces a blank .CSV file template for data import into TRUE.
- Export Accounts: Allows users to export the Chart of Accounts into a .CSV file.
- Import Records: Once the .CSV template has been correctly updated, selecting Import Records asks users to choose the template file and upload into TRUE.
Additional Features (List View)
- "+" icon: Click to add a new ledger account to TRUE. A card will pop open to allow the user to create an account.
- "Trash Can" icon: Inactivates a ledger account. This will not affect any prior accounting periods but will remove the account as an option for new entries.
Selected Ledger Account
Ledger Accounts Columns
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Category: Used for grouping and totaling on accounting reports. Shows the selected classification for the general ledger account. Examples include:
- Assets: Resources owned by the organization expressed in money terms.
- Liabilities: Debts or claims of parties other than the organization that must be paid or distributed.
- Equity: Owner's financial share of the company.
- Revenue: The revenue received from various sources by the organization.
- Expenses: The costs paid for a service or disbursements made by the organization.
- Subcategory: Used for grouping and totaling on accounting reports. Each category has its own specific subcategories.
- Identifier: An additional level of labeling and grouping ledger accounts on accounting reports. Examples include payable, sales tax, use tax, other asset, cash, or receivable.
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Ledger Number: Account numbers must be a minimum of four and a maximum of ten numbers. Common ranges include:
- Assets: 1000's
- Liabilities: 2000's
- Equity: 3000's
- Revenue: 4000's
- Costs of Goods Sold: 5000's
- Expenses: 6000's and up
- Ledger Name: Title of the ledger account. This is a customizable field based on the company's reporting preferences and active accounts.
Default Accounts Mode
Sales | |
|---|---|
| AR Account | Represents the account used to track money owed to the company by customers for goods or services provided on credit. |
| Retainage Receivable Account | Tracks the portion of contract payments withheld by customers until project completion or other conditions are met. |
| Revenue Account | Used to record income generated from the company's primary business activities. |
| Other Revenue Account | Records income from sources other than the company's primary business activities. |
| Deferred Revenue Account | Records payments received in advance for goods or services not yet delivered. |
| Sales Returns Account | Tracks the value of goods returned by customers and related adjustments. |
| Sales Tax Liability Account | Used to record sales tax collected from customers that must be remitted to tax authorities. |
Inventory | |
|---|---|
| Inventory Account: | Used to record and track the value of goods held for sale or production. |
| Goods Received not Invoiced Account | Records inventory items received but not yet billed by the supplier. |
| Cost of Goods Sold Account | Tracks the direct costs associated with producing goods sold by the company. |
| Inventory Shrinkage Account | Used to account for inventory losses due to theft, damage, or errors. |
Over/ Under Billing Adjustment | |
|---|---|
| Cost in Excess of Billing Account | This is referred to as ‘underbilling’, a situation where a subcontractor incurs costs for work that has yet to be billed to the client. |
| Billing in Excess of Cost Account | This is referred to as ‘overbilling’, a situation where a subcontractor bills more to the client than the costs they’ve incurred. |
Equity | |
|---|---|
| Unclosed Net Income Account | Used to track the company's net income or loss for the current accounting period. |
Payments | |
|---|---|
| Cash Account | Represents the company's liquid assets, including currency and bank deposits. |
| Credit Card Fee Account | Ledger account when a Credit Card fee is included in a Receipt Transaction Journal Entry |
Payroll | |
|---|---|
| Payroll Expense Account | Used to record the total cost of employee compensation, including wages and salaries. |
| Payroll Liability Account | Tracks amounts owed to employees and tax authorities for payroll-related obligations. |
Purchasing | |
|---|---|
| AP Account | Represents money owed by the company to suppliers for goods or services purchased on credit. |
| Expense Account | Used to record costs incurred in the course of business operations. |
| Use Tax Liability Account | This is the applicable ledger account link to the Tax Rate that is included in a Bill or Invoice. |
| Purchase Returns Account: | Used to record the value of goods returned to suppliers and related adjustments. |
Rebates / Credits | |
|---|---|
| Vendor Rebate Account | Tracks rebates or discounts received from suppliers, often based on purchase volume. |
| Vendor Credit Account | Records credits issued by suppliers for returns, adjustments, or other reasons. |
| Customer Credit Account | Used to track credits owed to customers, which may be applied to future purchases or refunded. |
Additional Features
- Integration with QuickBooks and Sage Intacct
- Automatic journal entry creation based on default accounts
- Flexible categorization and subcategorization of accounts
- Unique identifiers for semantic account recognition
- Grouping functionality for consolidated financial reporting
Common Workflow Questions
- How do I add a new ledger account?
- Can I set up default accounts for specific types of transactions?
- How do I use the Class feature for financial reporting?
- How can I group ledger accounts for financial statements?
- What's the difference between Category and Subcategory?
- How does the Identifier field help in account management?