Overview

The Chart of Accounts (COA) is a list of all the accounts used by the business to monitor financial transactions and create reports. You do not have to create a COA when you create a client in Drake Accounting - you can create the COA later. You must create a COA to use the bookkeeping function, but it is not required if you use DAS only for payroll, payables, or receivables.

For a new client, you can use a pre-formatted COA template, customize a COA, or import a COA used in another client account. COA templates provided in Drake Accounting are categorized and numbered according to GAAP (Generally Accepted Accounting Principles) guidelines.

See Chart of Accounts for a video demonstration.

To create a new COA:

1. Go to Accounting > Chart of Accounts. The Chart of Accounts – Setup dialog box opens.

2. Review the three available options for creating a COA:

   1. Templates: You can select a COA template for one of these business types: 1040 (individual), 1065 (partnership), 1120 (corporation), 1120S (S Corporation) 990 (tax exempt organization) or Faith Based. Each template consists of numbered accounts without balances, appropriate for the business type you select.

   2. Copy existing Client Chart of Accounts: You can use the COA from a client that already exists. The copy method can save you time if you have multiple clients using the same COA. Only the account numbers and descriptions are imported, not the account balances. You can select from a list of all your clients with a COA in Drake Accounting.

   3. Customize: You can create your own COA from scratch. Use this method if the client has an existing COA that you want to duplicate in Drake Accounting. If you expect to use a custom COA for several clients, we recommend you create a test client file to use as a master. You can then import this COA as often as you need to create new client files. Use GAAP (Generally Accepted Accounting Principles) guidelines when creating a customized COA.

3. To proceed, select one of the three options and click Next. If you selected

   • Templates, the list of business type COA templates is now displayed.

     • Select the template to be used and click Next.

     • A zero-balance COA for your selected business type is displayed.

   • Copy Existing Client Chart of Accounts, a list of the client codes of all your Drake Accounting clients with a COA is displayed.

     • Select the Drake Accounting client whose COA you want to use and click Next.

     • A zero-balance copy of the COA from the client you selected is displayed.

   • Customize, a blank Chart of Account - Setup screen appears, ready for account creation.

4. Select (or create and select) the account to be designated as the Retained Earnings Account. Only accounts with an Account Type of “Capital” may be designated as the Retained Earnings Account. To assign the account as a Retained Earnings Account, double click on the desired account and select Retained Earnings from the Sub Type drop list.

5. Click Save once you are finished.

   Important  Do not change this information once data has been entered in Accounting > Transactions > Unposted.

6. To edit or delete an account in the COA, double-click the account.

   • You can edit all of the information in an account within the COA until a transaction has been posted to that account.

   • After that, only the Account Number, Name, Budget, Tax Form, Tax Line, and Tax Form Instance fields can be edited for the account.

   • For more detailed instructions, click Help at the top of the screen.