The following are some best practices that we received that should be helpful in helpful us to developing our new Chart of Accounts.
I have some generic Chart of Account best practices documentation:
1. Eliminate small balance accounts.
2. Reduce the chart of accounts.
3. Use identical chart of accounts for subsidiaries.
After working in PeopleSoft GL for the past 10 years, I have my own set of practices:
1. Define your reporting first - that will drive the ChartFields needed (Product reporting, Region reporting, etc.)
2. Identify the ChartFields needed and then keep the usage for each field pure. If you have a Department field, don't identify locations in it.
3. Try to keep to the standard accepted numbering scheme for accounts: 1xxxx for Assets, 2xxxx for Liabilities, etc.
4. Stick to numbers instead of alpha whenever possible. If heads-down keying is required for journal entries, vouchers, purchase orders, etc., alpha characters will slow the data entry down. Sorting between numeric and alpha becomes tricky.
5. Try to keep the values within a field the same length. Don't use 20 (with 3 blanks) and 10120 in the same field. 10120 will sort before 20. Make it 10120 and 00020 if 20 has to be used.
6. While the actual values of a field should not be meaningful, the ranges of values are VERY important. Number like values together so ranges can be used. They are KEY to defining trees and reporting, combo edits, report parameters, query parameters, etc. If you do not use meaningful ranges, your maintenance for COA changes or additions will be a nightmare.
7. Try to use values across companies. Do not set up an Admin department for every different company. The combination of fields will give you unique reporting (the Business Unit number will keep the departments separate if they all use the same department number).