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Learn about the chart of accounts in QuickBooks Online

by Intuit•4• Updated 2 weeks ago

Learn what the chart of accounts is and why it’s important to set up correctly in QuickBooks Online.

The chart of accounts is a list of all the accounts that QuickBooks uses to track your financial data. Each account keeps track of your transactions and shows your balances. This helps you categorise transactions and set up the chart of accounts correctly to make sure your books are accurate.

Get familiar with the chart of accounts

To view your chart of accounts, go to Settings and select Chart of accounts (Take me there).

The accounts are organised in columns by name, account type, detail type, balance in QuickBooks, and bank balance. Account types and detail types determine the data that shows up in financial reports like the Balance Sheet and Profit & Loss.

Accounts with account history allow you to review transaction history and current balances. To view the account history or report in the chart of accounts, select Account history or Run report.

Note: If an account doesn’t have an account history, you can run a report to see transactions for that account.

Learn about account types in the chart of accounts

The account type column categorises transactions into a few main account types, including:

Assets: a record of purchases for things like vehicles, equipment, buildings, or other assets used for business.
Liabilities: a record of money you owe but haven't yet paid like loans, mortgages, or lines of credit.
Income: transactions and payments related to your normal day-to-day business, such as sales revenue or income for services rendered.
Expenses: a record of money you spend on expenses related to normal business operations, such as advertising and promotion, office supplies, or rent.

Customise your chart of accounts

QuickBooks automatically sets up your chart of accounts, but you can customise it to meet your business needs. You can add or remove accounts, and make them active or inactive. You can also use account numbers any time, it is not required but your accountant may recommend them.

Learn about accounts that QuickBooks sets up for you

QuickBooks Online automatically sets up a few of the same standard accounts in the chart of accounts and then gives you additional accounts automatically based on your business entity. There are also accounts that are only created when you take certain actions in QuickBooks.

Here are a few of the most common accounts QuickBooks creates for you:

Account	What it’s for
Trade and other payables	A record of the outstanding bills that your business owes. If your business uses multiple trade and other payable accounts, QuickBooks will let you choose the account you want to use when you enter and pay bills.
Trade and other receivables	A list of transactions related to customers who owe you money. If you need to use more than one trade and other receivable account, QuickBooks will let you choose the trade and other receivable account that you want to use when you create an invoice or receive a payment.
Opening Balance Equity	Ensures that you get a correct balance sheet for your company, even before you've entered all your company's assets and liabilities.
Retained Earnings	Tracks profits from earlier periods that have not yet been distributed to owners. At the beginning of the financial year, QuickBooks automatically transfers net income into your retained earnings account.
GST Control	Tracks all GST you collect and pay. You might not see this account if you haven’t turned on GST in QuickBooks.
Uncategorised Expense	Money your business spends that needs to be categorised.
Uncategorised Income	Money your business earned that needs to be categorised.
Undeposited Funds	Holds cash or cheques that your business is ready to deposit at the bank.
Inventory Asset	Tracks the current value of your inventory. You might not see this if you haven’t turned on inventory tracking.
Reconciliation Discrepancies	Tracks reconciliation adjustments. This account is automatically created if you have a discrepancy in a reconciliation.

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