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Understanding your Puzzle chart of accounts (COA)
Understanding your Puzzle chart of accounts (COA)
Andrew Robinson avatar
Written by Andrew Robinson
Updated over a week ago

🎑 Background

Puzzle provides users with a default chart of accounts (COA), which defines the standard financial statement categories used for accounting purposes. The accounts in the COA are also referred to as “General Ledger accounts” because these are the accounts that are used in the General Ledger.

Users can also create sub-accounts for any of the default accounts.

🔍 Where will these accounts show up?

Categorization of transactions: Each account in the COA corresponds to a “category.” With the help of rules and automation, users apply a category to each transaction in Puzzle, which determines which account the transaction will be recorded in the General Ledger.

Financial statements: Each account in the chart of accounts relates to a specific financial statement line in the Balance Sheet or Profit & Loss Statement (P&L).

🎥 Chart of Accounts Preview (Google Sheets)

Within the Google Sheet linked above, you can see the Puzzle standard chart of accounts.

A few notes:

  1. Accounts with an "indentation" marker (└) are sub-accounts. These accounts roll up to parent accounts. Most of the parent accounts do not allow posting.

  2. Accounts highlighted in light blue (such as the bank, credit card, and payroll accounts) are integration-driven, so they will not be created until an integration is set up. The COA will reflect these sub-accounts after integration.

➕ Customizing the Chart of Accounts

You can add sub-accounts to your company’s chart of accounts within Puzzle, which allows you to organize your finances for certain categories that are especially important to your business.

Upon request, a Puzzle admin ([email protected]) can also add additional parent-level accounts to your specific chart of accounts. We can also work with you to add a custom chart of accounts, if you have an existing COA that you want to use.

🤔 When might you want to customize the chart of accounts (or not)?

Based on your business model or desired level of detail, you may want to add additional accounts to the default chart of accounts. The Puzzle chart of accounts is meant to serve as a baseline but will not suit every company perfectly. That’s why we add the ability to customize! Beware of having a too-large chart of accounts though; it’s easy to get carried away and get too detailed, such that your chart of accounts becomes as specific as each vendor. Doing so can make it hard to find the things you really need, making your financials harder to manage. It also separates items that should really be considered as a unit. You want to be sure your accounts provide summary-level detail.

🗞️ Extra insight: Structure of the account numbers

10000-Series: Asset accounts

  • 10000-14999 >>> Current

    • Order of liquidity**

      • 10000-10999 >>> Cash and Cash Equivalents

      • 11000-11999 >>> Marketable Securities and Investments, Reserves of Cash

      • 12000-12999 >>> Accounts receivable

      • 13000-13999 >>> Prepaid Assets & Other Current Assets

        • 13000-13499 >>> Prepaid Assets

        • 13500-13999 >>> Other Current Assets

          • 13600-13699 >>> Current tax assets

      • 14000-14999 >>> Inventory

  • 15000-19999 >>> Noncurrent

    • Order of liquidity**

      • 15000-16999 Fixed Assets

        • Buildings

        • Machines

        • Land

      • 16000-16999 Investments

      • 17000-17999 Intangible Assets

      • 18000-18999 Goodwill

      • 19000-19999 Other Noncurrent Assets

        • 19600-19699 >>> Noncurrent tax liabilities

20000-Series: Liability accounts

  • 20000-25999 >>> Current

    • 20000-20999 >>> AP to Vendors

    • 21000-21999 >>> AP Payables to Other Parties

      • 21100 >>> payables to CC companies

      • 21200 >>> payables to Benefits Provider

      • 21900 >>> Interco payables

    • 22000-22999 >>> Short-term notes payable and Debt due in <12 months

    • 23000-23999 >>> Accrued Payroll

    • 24000-24999 >>> Deferred Revenue <12 months

    • 25000-25999 >>> Accrued Taxes, Leases, Interest, Other

  • 26000-29999 >>> Noncurrent

    • 26000-26999 >>> Debt due in >12 months

    • 27000-27999 >>> Deferred Revenue >12 months

    • 29000-29999 >>> Other Noncurrent Liabilities

30000-series: Equity accounts

  • 30000-30999 >>> Common stock and related accounts

  • 31000-31999 >>> Preferred stock and related accounts

  • 32000-32999 >>> SAFEs, hybrid equity instruments, and related accounts

  • 33000-33999 >>> APIC.

  • 34000-34999 >>> Retained earnings and related accounts

  • 35000-35999 >>> Other equity

  • 39000-39999 >>> Accumulated Other Comprehensive Income and related accounts

40000-series: Revenue accounts (operating revenue only)

  • 40000-40999 >>> Subscription Revenue

  • 41000-41999 >>> Services Revenue

  • 42000-42999 >>> Transaction Revenue

  • 43000-43999 >>> Usage Revenue

  • 48000-48999 >>> Partnership Revenue

  • 49000-49999 >>> Miscellaneous Revenue

50000-series: Cost of revenue accounts

  • 50000-50999 >>> Cost of Materials

  • 51000-51999 >>> Hosting Fees

  • 52000-52999 >>> CoR Software used directly in delivery of product or services

  • 53000-53999 >>> Payment Processor Fees

  • 54000-54999 >>> Shipping Costs

  • 55000-55999 >>> Allocated salaries and labor

  • 56000-58999 >>> [UNDEFINED - possibly: overhead allocations, packaging, etc. - depends on industry]

  • 59000-59999 >>> Other

60000-series: Standard operating expense accounts (standard purchases and disbursement categories)

  • 60000-60999 >>> Payroll

  • 61000-61999 >>> Other Employee Costs

  • 62000-62999 >>> Travel

  • 63000-63999 >>> Meals & Entertainment

  • 64000-64999 >>> Professional Services

  • 65000-65999 >>> Sales & Marketing

  • 66000-66999 >>> Technology & Software

  • 67000-67999 >>> Facilities

  • 68000-68999 >>> General Operations

  • 69000-69990 >>> [UNDEFINED - can be used by users for additional exp categories]

70000-series: Other operating expense accounts (non-cash expenses and miscellaneous operating expenses not directly related to expected ongoing operations)

  • 70000-70999 >>> Depreciation

  • 71000-71999 >>> Amortization of intangibles

  • 72000-72999 >>> Amortization of goodwill

  • 73000-75999 >>> [UNDEFINED]

  • 76000-76999 >>> Bad debt expense (write offs and reserve)

  • 77000-78999 >>> [UNDEFINED]

  • 79000-79000 >>> Other & misc operating expense

8 = Non-Operating income accounts

  • 80000-80999 >>> Non-Operating Income & Expenses

  • 81000-82999 >>> [UNDEFINED - users can use for their specific income and expense types if desired]

  • 83000-83999 >>> Credit Card Rewards

  • 84000-85999 >>> [UNDEFINED]

  • 86000-86999 >>> Taxes

  • 87000-87999 >>> Interest Expense

  • 88000-88999 >>> Interest and Dividend Income

  • 89000-89999 >>> Other (misc)

9 = Uncategorized and P&L clearing (requires attention to resolve)

  • 91000-91999 >>> Uncategorized Revenue

  • 92000-92999 >>> Uncategorized Expense

  • 93000-93999 >>> [UNDEFINED]

Ending conventions

  • 005, 050, and 500 >>> Contra-account

    • For an account with multiple contra-accounts (e.g. refunds and discounts for revenue), add intervals of 10

  • 9, 99, and 999 >>> Adjustment account

    • 98 and 998, then 97, 997 should be used if there are multiple types of adjustment accounts

  • Note 1: The “5” ending conventions are appended starting with the first zero of the related account but not before the 2nd digit, and the “9” ending can start after the 1st digit (e.g. 42000 becomes 42500 or 42999, while 40000 becomes 40500 or 49999)

    • However, the number should not be greater than then next-highest account number to which the manual adjustment does not apply (e.g. if 40000 is subscription revenue and 41000 is services revenue, 40999 should be the manual adjustment account rather than 49999, even though the 2nd digit slot is available.)

  • Note 2: If the contra-account is not related to a specific account but is more of a general “catchall” contra-account (e.g. manual JEs to adjust revenue that includes multiple revenue streams), these can go at the end of a grouping of accounts rather than after a specific account (e.g. 49999 for all revenue, rather than

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