Use the Chart of Accounts
See and add the accounts your books are made of, and set up accounting for a new company.
The chart of accounts is the list of accounts every transaction posts to. Open Accounts > Accounting > Chart of Accounts or go to Chart of Accounts. You need access to the Accounting module.
Set up accounting
A brand-new company shows "No accounts yet". Click Set up accounting (it needs create access). This adds the standard accounts every posting needs and the current financial year with its monthly periods. It is safe to run again: it only adds what is missing.
The standard accounts are:
| Code | Name | Type |
|---|---|---|
| 1000 | Cash | Asset |
| 1010 | Bank Account | Asset |
| 1100 | Accounts Receivable | Asset |
| 1200 | Inventory | Asset |
| 2000 | Accounts Payable | Liability |
| 3000 | Opening Balance Equity | Equity |
| 3100 | Retained Earnings | Equity |
| 4000 | Sales Revenue | Income |
| 4100 | Sales Returns | Income |
| 4900 | Uncategorized Income | Income |
| 5000 | Cost of Goods Sold | Expense |
| 5100 | Purchase Returns | Expense |
| 5900 | General Expenses | Expense |
For your country's tax scheme, it also adds a payable (liability) and a receivable (asset) account for each tax component, for example "VAT Payable" and "VAT Receivable", or one pair each for CGST, SGST and IGST. Each cash or bank account you add in Cash & Bank Accounts gets its own asset account too.
Read the chart
Accounts are grouped under Assets, Liabilities, Equity, Income and Expenses, each with a count. Each row shows the Code, the Name and badges: System for accounts Legasum posts to automatically, and Inactive. Use Find an account to search by code or name, and Hide inactive to tidy the list. The Ledger button on a row opens that account's ledger.
Add an account
- Click New account.
- Enter a Code (up to 20 characters, unique in your company) and a Name (up to 150 characters).
- Choose the Type: Asset, Liability, Equity, Income or Expense.
- Click Create account. You see "Account CODE - NAME created."
If the code is taken: "An account with this code already exists."
Edit an account
Click Edit on a row. You can change the Name and, for an ordinary account, untick Active, then click Save changes. The code and type cannot be changed once the account exists, because that would alter past reports. An inactive account is not offered for new entries but its history stays in the ledger and trial balance.
Good to know
- System accounts can be renamed but not deactivated: "A system account can't be deactivated: sales, purchases, payments and POS look these accounts up by role when they post."
- Invoices, bills, payments and POS sales always use the system accounts. Accounts you add yourself are used in manual journal entries and as the offset account for a reconciliation adjustment.
- Accounts cannot be deleted.
- If posting fails with "No ... account configured in the Chart of Accounts", run Set up accounting.