Accounts & Banking Linked Accounts window

The Accounts & Banking Linked Accounts window enables you to review and change the linked accounts for your cheque accounts, electronic clearing accounts, equity accounts and other bank accounts.

These accounts are automatically linked when you create a new company file using the New Company File Assistant. However, you may want to change the linked accounts to suit your business needs.

Field Descriptions

Equity Account for Current Earnings

This is the account that tracks the increase in your business’s equity during the current financial year. The amount assigned to this account is determined by subtracting the balances of all cost of sales and expense accounts from the balance of all income accounts.

Current earnings = income less cost of sales less expenses. This account is referred to as your Current Year Earnings account.

This account is used to calculate your profit (or loss) for the year to date. To ensure accurate financial reporting within your software, this account cannot be changed.

Equity Account for Retained Earnings

This is the account that tracks the increase in your business’s equity for all financial periods, but not including the current financial year. When a new financial year is started, the current earnings account’s balance is added to the balance of this account. This account is referred to as your Retained Earnings account.

This account is used to calculate your profit (or loss) for the year during the year-end closing process. To ensure accurate financial reporting within your software, this account cannot be changed.

Equity Account for Historical Balancing

Enter or select an account that will be used to track the difference in the opening balances you entered for your asset accounts and the opening balances you entered for your liability and equity accounts.

If, for example, the opening balance of all your asset accounts is $100,000, and the total balance of all your liability and equity accounts is only $95,000, the remaining $5,000 will be assigned to this account. To ensure your business records are accurate, this account’s balance should be zero.

This account is referred to as your Historical Balancing account. This account captures any out-of-balance amounts inherited from your previous accounting system.

Bank Account for Undeposited Funds

Enter or select an undeposited funds account into which individual receive money transactions are recorded. This account is referred to as your Undeposited Funds account.

Whenenter a transaction in the Receive Money, Receive Payments or Sales window, you can indicate that you want the amount to be grouped with your undeposited funds. If you do this, those funds will appear in this account until you deposit them in a bank account using the Prepare Bank Deposit window.

Account for Currency Gains/Losses

If you deal in multiple currencies, fluctuations in the exchange rate between currencies can affect the value of your transactions and account. These fluctuations are referred to as unrealised gains or losses.

For example, if you sell goods to a Japanese firm and you conducted the transaction in Japanese yen, any changes to the value of the yen will affect the overall profitability of the transaction. If the yen gains value against your local currency, this is a currency gain. If the yen loses value against your local currency, this is a currency loss. The linked account for currency gain/loss keeps track of these amounts.

This account is referred to as your Currency Gain Loss account.

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Click to save your changes and close the window.

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Related topics

■	Create a company file

■	Enter account opening balances