A well-structured chart of accounts (COA) is the backbone of good financial reporting. It determines how income, expenses, assets, liabilities, and equity are categorised—giving you a clear financial picture of your business. For business owners, especially those navigating GST, payroll, and compliance obligations, getting this right is essential.
At Stewart Private Accounting, our team of experienced Perth Bookkeepers knows how to tailor a chart of accounts that’s not just compliant—but also insightful, scalable, and easy to use.
Whether you're starting a new business or restructuring your current books, here's how professionals in Perth approach setting up a chart of accounts for long-term success.
What Is a Chart of Accounts?
A chart of accounts is an organised list of all the financial accounts used in your general ledger. It is the framework for categorising every financial transaction your business records. A typical COA includes:
- Income accounts (sales, service revenue, interest)
- Expense accounts (utilities, wages, rent, advertising)
- Asset accounts (cash, inventory, accounts receivable)
- Liability accounts (credit cards, loans, accounts payable)
- Equity accounts (owner’s equity, retained earnings)
The structure and naming conventions you choose in your COA will influence everything from how easy your reports are to read to how smoothly your BAS is lodged.
The Perth Bookkeeper’s Approach to Building a COA
1. Tailoring to Industry and Business Model
No two businesses are exactly the same, and neither should their COAs be. At Stewart Private Accounting, we begin by understanding the client’s business model, revenue streams, expense structure, and reporting needs.
For example, a retail business might need separate income accounts for in-store vs. online sales, while a tradie might track materials, subcontractors, and labour separately. Industry-specific categorisation makes reporting more meaningful.
2. Avoiding Overcomplication
One common mistake is creating too many accounts. This clutters reports and makes bookkeeping harder. Instead, we focus on creating clear, relevant categories that give business owners actionable insights.
A smart COA is one that’s lean but informative—it groups similar items together while still allowing for meaningful financial analysis.
3. Ensuring ATO and BAS Compliance
Australian businesses must comply with ATO requirements around GST reporting, payroll, and superannuation. Our Perth Bookkeepers ensure that tax codes are correctly applied and BAS-related accounts are set up to simplify lodgements.
We also set up tracking categories or cost centres where needed, to make reporting by department, location, or project easier.
4. Using Automation and Rules in Xero
Modern platforms like Xero allow you to automate transaction coding using bank rules and repeating templates. But for these features to work well, the chart of accounts must be clean and consistent.
Our team sets up automation-ready COAs—designed to reduce manual work while maintaining accuracy across every entry.
5. Planning for Growth
As your business grows, your financial reporting needs will evolve. We build charts of accounts with scalability in mind, ensuring that new accounts can be added in a structured, logical way without requiring a full overhaul.
If you eventually want to apply for finance or bring in investors, a clear and consistent COA helps make your business appear more professional and credible.
Real-World Example
One of our clients—a growing Perth-based construction company—initially used a generic COA that lumped all job costs into one expense account. This made it impossible to measure profitability by project.
We restructured their COA to include separate accounts for materials, labour, subcontractors, equipment hire, and compliance costs. Within weeks, the business owner had clearer insights, streamlined job costing, and was able to quote more accurately.
The Stewart Private Accounting Advantage
We don’t take a one-size-fits-all approach. Our Perth Bookkeepers take the time to set up or clean up your chart of accounts so it reflects your business and supports your goals.
Whether you’re starting fresh, switching from spreadsheets, or moving from one software to another, we’ll make sure your COA is structured correctly from the start—saving you time, money, and future headaches.
Final Thoughts
A well-built chart of accounts is more than just a list of numbers—it’s a roadmap to your business’s financial health. When set up correctly by professionals, it becomes a tool for clarity, decision-making, and compliance.
If your books feel messy, confusing, or difficult to manage, it may be time to revisit your COA. Let Stewart Private Accounting help you set it up right—the first time.A well-structured chart of accounts (COA) is the backbone of good financial reporting. It determines how income, expenses, assets, liabilities, and equity are categorised—giving you a clear financial picture of your business. For business owners, especially those navigating GST, payroll, and compliance obligations, getting this right is essential.
At Stewart Private Accounting, our team of experienced Perth Bookkeepers knows how to tailor a chart of accounts that’s not just compliant—but also insightful, scalable, and easy to use.
Whether you're starting a new business or restructuring your current books, here's how professionals in Perth approach setting up a chart of accounts for long-term success.
Comments