Chart of Accounts Redesign

Description

This course explains the importance of Chart of Accounts in the Accounting Function, Why Chart of Accounts becomes outdated and needs a Review and Redesign and what is the Best Practice driven approach for Redesign of Chart of Accounts

Chart of Accounts serve as the very base for the accounting function. The account codes organized in a specific logical order in the COA will be used for recording the financial impacts of various transactions.

With time the Chart of Accounts may become outdated and pose sever trouble to the Organizations with misleading Financial, Legal and Analytical Reports. It may be because of changing business landscape or business strategies or evolving accounting standards or legal and regulatory changes. It may also be because of legacy CoA inherited by an evolving organization.

The financial reports required for the new age businesses not only covers the traditional accounting details of transactions but also the statistical information which is quantities and trends of transaction progression over a period of time.

The tussle between the time and quality often results in winning of speed over accuracy and it puts immense pressure on the Financial Comptrollers and the CFOs to ensure that the financial information is captured and analysed quickly with minimal errors.

It is important to keep reviewing the COA periodically, consult the finance team on the difficulties they are facing, consult the senior management and stakeholders on the challenges they are facing with the reports and redesign the chart of accounts to ensure that new structure becomes flexible and can accommodate maximum possible foreseeable changes

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