As you know, the system of accounts is the basis of accounting. In order for the accounts not to be chaotic, but to give in to some kind of logical analysis, they certainly need to be ordered in such a way as to get a clear and clear system. It is to ensure that the system of accounts is not a burden, but a convenient and easy-to-use accounting tool, and there is a classification of accounts by economic content.
Accounting accounts are records (you can also call them registers), which display all the transactions of the same type conducted by the enterprise. Thus, the account collects all information about a particular type of asset, liability or process. Each account has a debit and credit side, which vary depending on the type of transaction. At the end of the reporting period, the final account balance is calculated. The classification of accounts by economic content can be shortened and expanded. An abbreviated classification option divides accounts into three types:
- Active - these are accounts that show all the funds of the enterprise at its disposal (assets). Active accounts in the debit reflect the occurrence of any funds in the enterprise (money, fixed assets, receivables, etc.), and in the loan - their disappearance (write-off, transfer to other persons and enterprises). The final balance of active accounts is displayed on debit.
- Passive - on these accounts all those sources are displayed, due to which the company received at its disposal certain funds. Such sources are called liabilities. As a rule, liabilities are associated either with liabilities or with the authorized capital of the enterprise. On these accounts, the loan shows the occurrence of the obligation (for example, obtaining a loan or the occurrence of payables to the supplier) or the introduction of the authorized capital, and at debit - the repayment of the obligations of the enterprise or the withdrawal of capital by the founders.
- Active-passive (procedural) accounts - show the processes occurring in the enterprise. Unlike active or passive accounts, active-passive accounts can have both debit and credit balances, depending on how the financial and business operations proceeded during the reporting period. The technique of maintaining these accounts is specific for each individual account, and therefore it is not possible to describe a universal methodology for handling active-passive accounts in this article.
The classification of extended accounts involves dividing them into ten classes, as can be seen in the chart of accounts. This classification involves the division of accounts into ten classes, and was invented several centuries ago by French economists. Since then, such a classification of accounts by economic content has become a universally recognized international accounting standard, and is still used in most countries of the world. The only difference between the domestic and foreign classifications is that in Western countries no numbers are assigned to accounts - the accountant writes only the name of the account, so he does not need to remember the entire numbering.
Classification of accounts by economic content makes it easy and simple to systematize a large number of accounts in simple and understandable categories, which means that it greatly simplifies the life of any accountant. Knowledge of this classification is one of the key moments in the life of any accountant on his path to a successful career.
And the last one. Very often, those who first encounter an accounting system cannot understand the difference between accounting and bank accounts. Remember that bank accounts and their classification are a completely different category of knowledge, albeit related to the field of finance and accounting, however, considering completely different aspects. Do not confuse bank accounts with bank accounts - this will help to avoid many mistakes in further work!