What is account code?
The account code is a series of accounting numerical codes arranged in the order of the subject classification in chart of accounts, and its numbering method is generally carried out with numbers, text, letters or marks.
Requirements of account code
A good account code numbering system must have certain rules and logic.
Each character in the serial number needs to be meaningful to show the difference between classes, items, sections, and subheads, and to show the connection between each subject, so as to achieve a clear, systematic and accurate hierarchy among classes, items, sections, and subheads, and accurately describe the content, nature and significance of each subject, also, it is easy for accountants to memorise and use.
Notice of account code
When compiling accounting codes, it is necessary to mark the major categories and subcategories and to display the order of arrangement, so that the hierarchy is clear and interrelated. The account codes should also be simple and clear, easy to remember, and easy to use, and the number should not be too many, instead, it should be flexible for the supplement subjects.Besides, if you use Xero accounting software to set the account code, you should pay attention to the upper limit of 10 characters.
Therefore, when an enterprise sets its own account codes according to its specific conditions, it should be consistent with the numbering system of the account codes in use. If the enterprise has other branches, it is also necessary to ensure that the account codes are unified to facilitate accounting information sharing.
Workstem
As a partner of Xero, Workstem users can push the completed payroll data to the financial system with one click through API, which saves the tedious and time-consuming import/export work with the financial team, and makes payroll + accounting more efficient.
Read more:
Xero Payroll Integration | Setting Up Payroll in Xero Guide
How to Go “Cloud” through Xero Integration?