Creating Your Chart of Accounts and Assigning Nominal Codes
In This Chapter
Getting familiar with some accounting concepts
Charting your accounts
Adding nominal codes in your Chart of Accounts
Changing your Chart of Accounts
In this chapter, I get down to the nitty-gritty of the accounting system – the Chart of Accounts (COA), which is made up of nominal codes. Think of the Chart of Accounts as the engine of the accounting system. From the information in your COA, you produce your Profit and Loss report and your Balance Sheet. Set it up properly, and the Chart of Accounts grows with your business, but set it up wrongly and you’ll have problems forever more!
Luckily, Sage gives you a lot of help and does the hard work for you, but you still need to understand why Sage is structured in the way that it is and how you can customise it to suit your business.
Understanding as Much as You Need to about Accounting
To use Sage, it helps if you have an appreciation of accounts and understand what you’re trying to achieve. But you certainly don’t need to understand all the rules ...