The chart of accounts is a comprehensive list of all the financial accounts used by a company to record and organize its financial transactions. It includes all the balance sheet and income statement items, such as assets, liabilities, equity, revenue, expenses, gains, and losses.
Each account in the chart of accounts is assigned a unique account number or code, making it easier to identify and track transactions. With a properly structured chart of accounts, a company can accurately capture financial data, generate financial reports, facilitate budgeting and planning, and ensure compliance with accounting and tax regulations.