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Definition
The chart of accounts is the full, coded list of accounts in your nominal ledger, organised into assets, liabilities, equity, income and expenses. Every transaction posts to one of them.
In plain terms
It is the filing system for your finances. A clean, sensible chart makes management accounts genuinely useful; a messy one buries the insight.
Why it matters for your company
A well-designed chart lets you see gross margin by product line, overheads by category, and the numbers lenders ask for. See reading management accounts.
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