Chart of accounts
A chart of accounts is the organised list of ledger accounts and their identifying codes used by an accounting system. It separates assets, liabilities, equity, income and expenses and supports consistent transaction coding and reporting. Software uses the selected account or mapping to generate entries, so an incorrect code can misclassify a transaction even while debits and credits agree.
Worked example
A new computer bought for business use is coded to equipment rather than office stationery, so the transaction is treated as an asset when recognition requirements are met.
Common mistake
A valid code is not proof of correct classification; choosing an expense code for equipment can create an error of principle.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | F1 | Supporting | July 2027–August 2028 |
| ACCA | F2 | Supporting | July 2027–August 2028 |
| ACCA | K1 | Supporting | July 2027–August 2028 |
Related terms
Also called: Account code list