In this video, Ciaran explains Charts of Accounts and the importance of having your own version of this.

How’s it going? Nice to see you again, the Chart of Accounts, it’s basically a list of account codes on your accounting system. Normally, when you create your company, for the first time, you’re either going to have the opportunity to put in your own version and make it bespoke to your business, or your accountant, or your bookkeeper is going to just use the default or a copy and paste. If you go for the latter, and it’s just the default or a copy and paste, you end up with someone else’s Chart of Accounts or just in alphabetical order, and trust me that is just no use to anyone. So take the opportunity to look at what you’ve got and see how you can customize it because when you can split different codes into different functional areas, you’re going to get a lot more gold stuff in different buckets, that makes it so much easier to see what’s going through your business. See you in the next one.

Ciaran is a VirtualFD or freelance finance director for early stage companies. He’s on a mission to help business owners like you to Own Your Numbers. He won FD/CFO of the Year at the 2019 British Accountancy Awards.