Question

Renumbers a Chart of Accounts

Forum|Forum|2 years ago
March 1, 2024
1 reply
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We have a COA that is outdated and want to create a new one. We came up with a new numbering scheme based on the uniform COA for nonprofits and have the following questions:

(1) What is the easiest way to update the COA numbers?

(2) We do not currently use classes but plan to use them after the renumbering. That means some old accounts would be merged into a single account with classes. What is the best way to do this? Does it make sense to preserve the old separate accounts for historical purposes or is there a way to merge them and automatically assign the expenses (or income) to a class based on the old account number? (each department had a unique number but the new COA will have the same number for like expenses but separate departments by class)

(3) We are currently using Desktop and plan to move to QB online. Does it matter when we update COA? Before the move, simultaneous with the move, or after the move?

(4) Is there a good training module/class for staff used to desktop to convert to QB Online, and for teaching how to use classes instead of separate GL codes?

QuickBooks Desktop

J

JuliaMikkaelaQ

I am grateful for your detailed explanation, Michael. I am here to offer insights on managing your Chart of Accounts (COA) in QuickBooks Desktop (QBDT).

First, you will need to manually update the COA numbers in each account of the program. You can follow these steps to do so:

Go to the Accountant menu, then select Chart of Accounts.
Select the account, then click the Account dropdown and select Edit account.
Add account numbers in the Number section.
Once done, select Save & Close.

On the other hand, you can choose to retain the existing separate accounts for historical reference and keep them unchanged. Nevertheless, if you prefer to consolidate them into a new account with assigned classes, QBDT provides a merging feature. However, if you're unsure, it's advisable to seek advice from your accountant on the optimal approach for managing both old and new accounts.

If you wish to merge them, opt for merging, ensure to set up class tracking in your accounting preferences initially, and then create a new account with the desired class. Once done, you can merge the old accounts into it. Here are the steps to follow:

Go to the Accountant menu, then select Chart of Accounts.
Take note or copy the name of the account you want to keep.
Right-click the sub-account you would like to merge, then click Edit Account.
Replace the name of the old account with the new one.
A prompt will appear to merge the account, select Yes to proceed.

Before migrating to QuickBooks Online (QBO), it's recommended that you update your Chart of Accounts and make any necessary changes to your Desktop version. This will help save time and ensure that everything is already set up once you make the move. Also, please know that it's not possible to assign a class to your accounts in QBO like you could in the Desktop version, you can still use class tracking to categorize your transactions.

Lastly, you can refer to these QuickBooks Help articles and video tutorials that can help you migrate your company file from QBDT to QBO:

Also, there are various video tutorials shared by experts available on different online video platforms that you can visit for more details.

Furthermore, you can visit this helpful resource about the step-by-step processes in QuickBooks: Get Started QuickBooks Tutorials.

If you have any other concerns about managing your Chart of Accounts and migration process, please don't hesitate to get back here again. I'm just around the corner to help. Take care and have a good one.

M

mrogovinAuthor

Thank you. A few followup questions.

1. If I am merging several accounts into one accont (either a new account or one of the existing ones, but want to keep the entries separate, but rather than in separate accounts they would be reported out by class, could I first assign a class to each of the accounts so that when they are merged the income, expense, or asset would be brought into the merged account with the correct class? that way we maintain the historical department breakdown, it just goes from separate GL account to separate classes. Does that work?

2. What do you mean by "it's not possible to assign a class to your accounts in QBO "?

Does that mean that if we want to assign a class to a transaction we won't be able to do this, or that we cannot add or rename classes? I am not sure what this statement means. We do not currently use classes, we have parallel GL accounts which would be merged as noted above. I want to set up the classes before the merge and switch to QBO.

3. What about vendors that are assigned to a GL account. Will the new numbering scheme automatically update the vendor list or will we have to manually recode every vendor. We are not planning to add many new accounts. Mostly renumbering and renaming.

J

JamesAndrewM

I appreciate you getting back to the thread. For the follow-up questions, I'll chime in and handle them for you.

In QuickBooks Desktop, you can only assign classes to transactions and after merging, the transactions from the individual accounts will be combined into the merged account, and the class information should carry over if you have assigned classes to each transaction. This way, you can still report on income, expenses, or assets by class even though they are now consolidated into a single account.

On the other hand, in QuickBooks Online, you can indeed assign classes to transactions. Classes in QBO are used to categorize transactions by departments, locations, or any other meaningful breakdowns within your organization. You can set up and assign classes to transactions to track and report on these categories.

Lastly, when changing the numbering scheme or merging accounts, the impact on vendors should be minimal. If vendors are associated with specific GL accounts, account information for each vendor may need to be reviewed and updated manually. QuickBooks Desktop usually doesn't automatically update vendor information based on account numbering changes. It's advisable to check the vendor details after making significant changes to your chart of accounts to ensure accuracy in your financial records. QuickBooks Desktop usually doesn't automatically update vendor information based on account numbering changes.

I'm adding these articles you can use in the future:

Feel free to post here again if you have further QuickBooks-related concerns. We are available 24/7 to lend a hand with each of your queries. Stay safe!

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