Choosing Nominal Codes in Accounting Package

[HarveyBall]

Hi all,

I'm new to this forum and new to business so please forgive me if my question has already been answered.

I'm trying to set up Microsoft Accounting Express 2009 to do my book keeping with. I need to put in my accounts and need to sort out my nominal codes.

I have a vague idea of what the nominal codes are for (they are just unique IDs that describe each pot of incoming/outgoing money in the business).

What I need to know is what codes should I be using to make it more universally readable to other people.

I need to set up 3 bank accounts

HSBC Current
HSBC Savings
HSBC Credit Card

So what nominal codes would be best for each of the bank accounts? and what nominal type would they each be?

I'm also not VAT registered and don't see myself being VAT registered for some time.

I've had a little play with MS Accounting Express and when I create products/services that I buy or sell, i need to choose which income or expenditure account that product should sit in and best the nominal code.

I tried to select the most obvious thing from the list for my sellable products (which was 2000 Sales/Output VAT) but this is a current liability account type and therefore doesnt work, So i just created my own called 4001 Sales Inc Tax and put it in the income account type section.

I also created one called 5001 Purchases Inc Tax and put it in the Expense account type.

I hope I've been clear enough to explain my problem.

Thanks in advance

 

[Fernhurst Solutions Ltd]

Hiya Harvey

Welcome to the forums ... I have never used MS Accounting, but would have thought that it would come with pre-defined Nominal Codes? I know it is free, but is it really worth going through the whole hassle of setting up all the nominals, when there is software out there from less than £100?

Andy

 

[Fernhurst Solutions Ltd]

To answer your question though, you would set up the Bank Accounts through 'Current Assets', so maybe 1200 | 1201 | 1202 as the N/C's

 

[DuaneJackson]

1200, 1201, 1202 is what I'd suggest too

 

[HarveyBall]

Hiya Harvey

Welcome to the forums ... I have never used MS Accounting, but would have thought that it would come with pre-defined Nominal Codes? I know it is free, but is it really worth going through the whole hassle of setting up all the nominals, when there is software out there from less than £100?

Andy

Hi Andy,

Thanks for your reply. There are already nominal codes in the software, however as I have to create my bank accounts then I need to put my own nominal codes in to associate with that account.

The only other thing is I don't know what nominal code to put my products against (customer income account, supplier expense account), As I said I created 2 new nominal codes and called them Sales Inc Tax at 4001 and Purchases Inc Tax at 5001, but I dont just want to invent nominal codes that dont help an accountant understand easily my books.

 

[NCA]

IIRC Office accounting has a predfined nominal type specifcaly for bank acccounts under balance sheet accounts. There is also one for credit cards under liabilities rather than more traditional negative asset treatment.

 

[Fernhurst Solutions Ltd]

Hi Andy,

Thanks for your reply. There are already nominal codes in the software, however as I have to create my bank accounts then I need to put my own nominal codes in to associate with that account.

The only other thing is I don't know what nominal code to put my products against (customer income account, supplier expense account), As I said I created 2 new nominal codes and called them Sales Inc Tax at 4001 and Purchases Inc Tax at 5001, but I dont just want to invent nominal codes that dont help an accountant understand easily my books.

My advice would be to get yourself an Accountant first, and then sit down with them (either face to face, or virtually) and go through what codes you have and what additional codes you require, that way you can start on the right footing and not get yourself into a muddle, which in turn will save you both time and money.

There is a sticky at the top of the page about how to choose an Accountant, or if you prefer send me your contact details via PM and I'll give you a call on Monday morning.

Andy

 

[HarveyBall]

Hi Andy,

Thanks for your advice. I have a friend who is an accountant so I'll see if they can spare me some of their time to go over it with me

Thanks for your info.

 

[Fernhurst Solutions Ltd]

Good luck with your new business.

Andy

 

[CassioAcc]

Microsoft Accounting has predefined nominal code and if you are setting up additional ones then use ones in the same range.

Why does you want to set up accounts called sales including tax? There should already be sales and purchases accounts and if you are not registered for VAT then this should be set in the preferences.

I use MS Accounting so if you need any help let me know.

 

[HarveyBall]

Hi Aaron,

I don't have many predefined nominal codes as I chose the Basic company type because none of the listed predefined companies seemed to match what I do.

My company is a Computer Solutions firm but it is a mix of products and services i.e. Some of my income is from selling prebuilt software solutions (off the shelf products) and other income is from bespoke solutions or consultancy (services).

 

[CassioAcc]

If you send me a PM I can send you an example chart of accounts that will help.

 

[Zahidparvez]

I think the best way forward is to create a new general company and then tailor it to your requirements, as setting up accounts from scratch is quite hard, specially control accounts. I will strongly suggest to start again as general company and then amend nominal descriptions

 

[HarveyBall]

I've started up a new company as a Trade Service which seems to have a good set of nominal accounts already that seem to match my needs

Thanks for everyone's help