Add New Ledger Account To Chart Of Accounts

LDG > Maintenance Options > Chart of Accounts

The Add New Account option on the Chart of Accounts Sub-menu creates a new account in the Chart of Accounts. The account may not already exist in the Chart of Accounts in the selected dataset. There are three screens in the Add New Account series.

Open

The Ledger Account is a fifteen-character field that is typically divided into three separate fields:

1. The Account Code field is the main account number and may contain a maximum of eight digits. The primary classification of a ledger account is based on the first digit in the Account Code field, as defined in Setup Information. This digit may not equal zero.

2. The Detail Code field may contain a maximum of four characters (numbers and/or letters).

3. The Profit Center Code field may contain a maximum of three characters (numbers and/or letters).

Because the Detail Code and Profit Center Code fields are available for range selection on the financial statements, an income statement may be produced for a specific commodity (or product category) or for a range of commodities (or product categories) if the commodity codes and product categories are matched to the Detail Code or Profit Center Code fields.

Refer to the coding scheme devised during the planning sessions for the general ledger before adding a new account. Type the new account code in the required Account Code input field. If used, type the new detail code in the optional Detail Code input field. If used, type the new profit center code in the optional Profit Center input field.

Review all entries prior to continuing. This screen is redisplayed upon completion the Add New Account series of screens. Press [Escape] to redisplay the prior sub-menu.

Although the sequence of digits in the Account Code fields do not have to be consistent to produce an income statement for a specific commodity as shown in the example below, the coding may be greatly simplified by varying only the first digit to indicate asset, revenue, cost of sales, and expense accounts. In the example below, the detail code is set to 21 in order to easily distinguish all accounts for corn.

Example of accounts with a detail code for corn:

Open

The second screen (above) in the Add New Account series is divided into two sections. The upper section contains the account code, detail code, and profit center from the first screen. The lower section contains input fields to fully describe the account.

1. Type a descriptive title in the Description input field. The description typed in this input field is available for printing on various reports and financial statements, and is displayed on the inquiry screens. Since this field is used in the account code search feature in locating a specific ledger account, the user should be consistent in using all upper-case or both upper and lower-case characters. The use of upper and lower-case may be related to the type of account. For example, the first character of each significant word in upper-case if the account is a posting account; all characters in upper-case if the account is either a format or a text account.

2. Accounts are categorized by type, as indicated in the Type legend box. G/L distributions may only be posted to type 1 for posting accounts. Type 2 for format accounts control the accumulation of totals and subtotals for printing on financial statements. Format accounts are sub-divided into heading and total accounts. The description on type 3 for text only accounts replace the descriptions on accounts with matching account codes but with different detail codes and/or profit center codes on financial statements. Override the default in the Type Of Account input field when adding either a format or text only account.

3. As indicated in the Before/After legend box, the user may control the printing and appearance of the account when printing a financial statement. For example, sub-total accounts may be printed with a single underline while totals and grand totals may be printed with a double underline. If needed, a blank line or a new page may also be included in the account definition. Type the desired option number in the Before This Account and After This Account input fields. It is not necessary to start a new page after one account and before the next account. For example, if a new page is indicated after account 1999, do not indicate a new page before account 2000.

4. The minus sign (-) may be included in the printing of accounts with credit balances on financial statements. The default value established in Setup Information may be overridden on specific accounts. A positive response to the question "Reverse sign?" omits the minus sign when printing a credit balance for this account. A negative response to this question prints the minus sign in front of the credit balance. The response to this question affects only the printing of the balance and does not affect the calculations of totals.

5. Type appropriate values in the three User-Data #1-#3 input fields. The descriptive titles assigned in Setup Information to the User Data fields appear and on various reports in the selected dataset. Since the values in these fields may be exported, these three fields may include an account number used in another software system or a further extension to the fifteen character account number. Refer to the corporate policy and procedures manual regarding use of these three input fields.

The input fields displayed on the third screen are related to the TYPE of account specified above ( 2 ).

Type of Account = Posting

The default values in each input field are defined in Setup Information and may be overridden as necessary.

1. A positive response to the question "Financial statements by location code?" tracks balances in the selected ledger account by individual location code. Although both balance sheet and income statement type accounts may be tracked by location code for financial statement reporting, the Generally Accepted Accounting Practices (GAAP) do not recognize a balance sheet by location. A positive response is appropriate if there are more than one accounting entity in the dataset and if separate financial statements are desired for each entity. A negative response to this question does not track balances by location code. Consolidated financial statements may be produced with either response.

2. A positive response to the question "Track transactions by source ID code?" forces entry of a source code during manual journal entries. A negative response to this question sets the input fields to optional entry.

3. A positive response to the question "Track transactions by execution ID #?" tracks transactions that relate to this account for execution id reporting purposes. A negative response to this question bypasses execution ID number entry on the selected ledger account. Typically, only the income statement accounts track transactions by execution id.

4. A positive response to the question "Active posting account?" activates the account to permit posting. A negative response to this question prevents posting to this account.

5. As indicated in the Quantity legend box, the account may be set to not allow, to require, or to permit entry of a debit or credit quantity in the Manual Journal Entry option. Type the appropriate value in the Quantity On Manual Journal Entries input field.

6. A positive response to the question "Allow use with manual vouchers?" permits G/L distribution during Voucher Maintenance in ACP to the account. A negative response to this question prohibits G/L distribution to the account during Voucher Maintenance.

7. A blank or positive response to the question "Allow use with manual invoices?" permits G/L distribution during Invoice Maintenance in ACR to this account. A negative response to this question prohibits G/L distribution to the account during Invoice Maintenance.

8. A blank or positive response to the question "Allow use with manual bank transactions?" permits G/L distribution during Bank Maintenance in BNK to this account. A negative response to this question prohibits G/L distribution to the account during Bank Maintenance.

9. A blank or positive response to the question "Allow use with budget transactions?" permits G/L distribution during Budget Account Maintenance. A negative response to this question prohibits G/L distribution to this account during Budget Account Maintenance.

Type of Account = Format

The third screen in the series contains two input fields if the type of account is set to format.

1. Type 1 for header account or 2 for total account in the required Type Of Format input field.

2. The Format Level input field controls the accumulation of totals and sub-totals and the indention from the left margin on standard financial statement forms. Type the format level in the space provided.

• Format levels define "brackets". The corresponding heading and total accounts determine where an accumulation for subtotals begins and ends. Format-heading accounts are not required, but add to the legibility of the financial statements. A format-heading account may be replaced with a text only account.

• The balances in all posting accounts inside a bracket are accumulated for subtotals. The brackets within brackets are also accumulated for subtotals. A rule to remember: A lower level number indicates a larger, more encompassing bracket than a higher level number. Format levels are zero through nine (0-9) and the pound sign (#), which is similar to the zero level in that a major total is produced. The accumulation process does not reset to zero in the pound sign format level.

Type of Account= Text Only

The default values in each input field are defined in Setup Information and may be overridden as necessary.

A positive response to the question "Financial statements by location code?" tracks balances in the selected ledger account by individual location code. Although both balance sheet and income statement type accounts may be tracked by location code for financial statement reporting, the Generally Accepted Accounting Practices (GAAP) do not recognize a balance sheet by location. A positive response is appropriate if there are more than one accounting entity in the dataset and if separate financial statements are desired for each entity. A negative response to this question does not track balances by location code. Consolidated financial statements may be produced with either response.

Your new account has been added and you can now map to it or start making manual LDG entries. You can print your Chart of Accounts to verify the new account will fall where it belongs on Financial Reports.

Created 6/22/23 DBorg