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Odoo 11 Accounting: Chart of Accounts


Purpose

The purpose of this documentation is to outline the processes associated with a Chart of Accounts.

A Chart of Accounts is a listing of all accounts used in the general ledger of an organization. The Chart of Accounts should be tailored to reflect the actual operations of a company and an organization has the freedom to add or remove accounts, as needed, to better suit its needs.

Processes

To get started, navigate to the Accounting application.

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Configuring the Chart of Accounts

Once there, click on Configuration and then Chart of Accounts.

You will see a list view of all accounts. From here you can modify, remove and create accounts, as needed.

To simplify this view, click on the Group By option and select 'Account Type'.

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Editing an Existing Account

To edit an existing account, click on the account you wish to edit and then click the edit button. Change the various fields, as needed. When finished, click the save button.

Deleting an Account

To delete an account, select the checkbox next to the account's Code. Then, click the Action dropdown menu and select 'Delete'.

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Important Note!

In a production environment with existing data, you should not delete an account. Instead, follow the instructions above in the 'Editing an Existing Account' section and select the 'Deprecated' checkbox.

Deprecated accounts will still show up in your list view of accounts unless you filter them out.

Creating a New Account

From the list view of accounts, hit the Create button.

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The following fields are required when creating an account:

  • Name: The name of the account, which indicates what types of transactions are classified under this account.

  • Code: A unique number that helps in identification of the account type and may also be coded with further information.

  • Type: The type of account, which is detailed below in the 'Choosing an Account Type' section.

When finished, hit the Save button.

  Choosing an Account Type

Choosing the correct Account Type is extremely important as they affect your overall reporting.

  • Receivable: Record funds owed to you (Example: For products or services delivered)

  • Payable: Record funds you owe (Example: Bills from suppliers)

  • Bank and Cash: Record bank and cash transfer transactions
  • Current Assets: All Assets that can be reasonably expected to be converted into cash within one year
  • Current Liabilities: Financial obligations that are payable within one year
  • Non-current Assets: Long-term investments where the full value will not be realized within the accounting year
  • Non-current Liabilities: Financial obligations that will not become due within the accounting year
  • Equity: Record capital gains and losses (To measure the net worth of your business)
  • Income: Record revenue your business earns
  • Expense: Record outflow of funds to pay for goods and services your business uses
  • Fixed Asset: Record assets and property that cannot be easily converted into cash (These will not be used up, consumed, or sold within the current accounting year)
  • Current Year Earnings: Record net income or loss for your company within the current year (The difference between all revenues and expenses on an income statement)
  • Other Income: Record income that does not come from your company's main business (Example: Interest)
  • Cost of Revenue: Record total cost incurred to obtain a sale and the cost of the goods or services sold (Example: The cost of materials or cost of production labor)

Account Reporting

From the Print menu on an account, you are able to generate three reports: Partner Ledger, General Ledger, and Trial Balance.

  • Partner Ledger: The sales invoices that were awaiting payment

  • General Ledger: All transactions during a chosen period of time

  • Trial Balance: Closing balances of account on a specified date

Unreconciled Entires and Journal Items

From the Action menu on an account, in addition to deleting and duplicating, you can also choose to view unreconciled entires and journal items for a specified account.

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Journal Items for the Fixed Asset Account