Step 1: Designing Your Financial Framework

Creating Your Chart of Accounts

The chart of accounts is where all data flows to so users can analyze how their business is doing. For example, as a business buys and sells goods or services the details of those transactions get summarized in the General Ledger. Owners and managers can then take that detail and compare the actual results to what was estimated at the beginning of the period.

We will discuss the following which relates to developing a robust chart of accounts. In this section we’ll cover the following:

  • Posting Type
  • Categories
  • Account Format
  • Entering Accounts

If you would like, you can always login to Fabrikam, the sample company that was installed with your system. This will allow you to see a sample company all set up, and allow you to try things out without affecting your live system.

To access Fabrikam, click on your company’s name in the lower left hand side of Dynamics GP, and select Fabrikam in the Company Login window.

Chart of accounts 1

Your system already includes a chart of accounts. This is the basic structure for transaction processing and reporting in Dynamics GP. The first thing you’ll want to do is review it.

To review your Chart of Accounts, navigate as follows: Financials>>Cards >> Account

Chart of accounts 2

This will bring up the Account Maintenance screen, from which you can view and edit your Chart of Accounts.

Chart of accounts 3

You can use the “magnifying glass” to look up existing accounts, use the scroll buttons at the bottom, or merely type in the account number in the Account field.

Be sure that the correct Posting Type is selected for each account to be either a Balance Sheet account or a Profit and Loss account. This selection will impact the end of year processing when you close an accounting year.

Chart of accounts 4

You may want to look at the Account Format Setup to verify the basic framework for your Chart of Accounts. Navigate as follows: Administration >> Setup >> Company >> Account Format

This will bring up the Account Format screen:

Chart of accounts 5

The chart of accounts included in your system has three segments. If you want you can add segments to your Chart of Accounts. You can change the Name of the segments. And you can select the Main Segment ID.

You add to your Chart of Accounts if you wish. You can also delete accounts if you don’t want them in your chart. It’s up to you.

Take a look at this video to see this in action: Chart of Accounts in Dynamics GP


Defining Fiscal Periods

In the next message we’ll take a look at how to set up fiscal periods in your system.

If you need to start all over, follow these procedures to delete your existing chart of accounts.

Chart of accounts 6

You will not be able to delete the full chart of accounts if you have any transactions entered into your Dynamics GP company. You will also need to check your system setups that contain references to general ledger accounts, because they will most likely be wrong after you re-enter the chart of accounts. Be aware that the prebuilt Management Reporter reports will need to be adjusted/recreated as the reports are built for the supplied chart of accounts in the system.

To delete an existing chart of accounts in its entirety, complete the following:

Navigate to the Clear Data screen: Financial>>Cards>>Mass Modify

You can choose the Delete option and click on the all button. A partial deletion by segment can also be done by choosing the From and To range.

After you choose Modify at the bottom right your former chart of accounts is now gone, forever.

You can now adjust the account framework as desired and reenter a new chart of accounts. If you would like to import a new set of accounts you can do so with an additional tool called Integration Manager. This tool is currently offered in the Customization Pack which is an added monthly fee beyond standard pricing.