{"id":"concept:chart-of-accounts","kind":"concept","label":"Chart of Accounts","synonyms":["COA","account list"],"definition":"A chart of accounts is the complete list of asset, liability, equity, income, and expense buckets that every journal entry in a book posts into.","summary":"Every bank account, credit card, and income or expense category your money can sit in or move through. Accounts sort into numbered blocks by type — 1000s for assets, 6000s for expenses — purely so related ones group together; the number itself carries no other meaning.","explanation":["A chart of accounts is the fixed list of buckets a set of books can record into, each with a code, a name and a type. It is the vocabulary of a particular business: nothing can be recorded that does not name one of these accounts, and the list is what makes two months comparable, because the same charge lands in the same place both times.","The type is the load-bearing part, not the name. Every account is exactly one of asset, liability, equity, income or expense, and that choice determines which statement it appears on and which direction increases it. An account named plausibly but typed wrongly will produce reports that balance and mislead.","The code exists for ordering rather than meaning. Numeric ranges group accounts by type — assets low, expenses high — so a report lists them in a familiar order without anyone sorting it. Codes are conventional rather than standardised, and two businesses can use different numbers for the same thing.","What it is not: a budget, a tax form, or a fixed schedule anyone must adopt. BalanceMCP seeds one when a book is created, business or personal, and accounts can be added afterwards though the chart's flavour cannot be swapped."],"commonMistakes":["Creating a separate account for every vendor instead of one per kind of spending — the memo already records who the money went to.","Picking business vs. personal chart casually — the choice can't be swapped after the book is created, only individual accounts added.","Trying to delete an account that has history — the journal is append-only, so archiving (not deleting) is the only option."],"category":"fundamentals","questions":[{"question":"Can I switch from the business chart to the personal one later?","answer":"No — the chart you pick at book creation is the one that book uses going forward. You can add or archive individual accounts afterward, but not swap the whole template."},{"question":"Do I need to set up an account for every bank card myself?","answer":"No — BalanceMCP creates one automatically the first time you import a statement from a given bank account or card, giving it its own code so its activity stays visible on its own."}],"url":"/glossary/chart-of-accounts","relatedTo":[{"id":"concept:account","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Aaccount"},{"id":"concept:asset","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Aasset"},{"id":"concept:liability","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Aliability"},{"id":"concept:equity","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Aequity"},{"id":"concept:income-account","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Aincome-account"},{"id":"concept:expense-account","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Aexpense-account"},{"id":"concept:bank-account","relationship":"related","weight":0.9,"api":"/api/knowledge/concept%3Abank-account"},{"id":"guide:what-is-a-chart-of-accounts","relationship":"references","weight":0.7,"api":"/api/knowledge/guide%3Awhat-is-a-chart-of-accounts"},{"id":"tool:manage_accounts","relationship":"references","weight":0.7,"api":"/api/knowledge/tool%3Amanage_accounts"},{"id":"tool:create_book","relationship":"references","weight":0.7,"api":"/api/knowledge/tool%3Acreate_book"}],"referencedBy":[{"id":"concept:general-ledger","label":"General Ledger","url":"/glossary/general-ledger"},{"id":"concept:account","label":"Account","url":"/glossary/account"},{"id":"concept:operating-expense","label":"Operating Expense","url":"/glossary/operating-expense"},{"id":"concept:vendor","label":"Vendor","url":"/glossary/vendor"},{"id":"concept:expense-account","label":"Expense Account","url":"/glossary/expense-account"},{"id":"concept:bank-account","label":"Bank Account","url":"/glossary/bank-account"},{"id":"guide:what-is-a-chart-of-accounts","label":"What a Chart of Accounts Is, and How to Choose One","url":"/guides/what-is-a-chart-of-accounts"},{"id":"tool:list_books","label":"See every set of books your AI assistant can reach","url":"/tools/list_books"},{"id":"tool:create_book","label":"Start a new set of books, seeded with real accounts on day one","url":"/tools/create_book"}],"license":"https://creativecommons.org/licenses/by/4.0/","attribution":"BalanceMCP — https://balancemcp.com"}