What is chart of accounts cleanup?
A chart that produces a readable P&L instead of ninety accounts nobody uses.
Most Australian charts of accounts didn't get designed either — they accumulated the same way, just against a different reporting calendar. Someone added "Subscriptions" in the first BAS quarter because Xero's bank rule didn't recognise the merchant, then a second bookkeeper added "Software Expenses" the next quarter, and a third catch-all called "Sundry" absorbed whatever nobody wanted to code. Four BAS cycles later the quarterly activity statement takes longer to prepare than it should, half a dozen expense accounts each move under a few hundred dollars a month, and the owner stops looking at the profit and loss between visits to their accountant. That's the trigger here too: not one bad entry, a slow drift that made the file harder to read every quarter it went untouched.
A chart built for readability in Australia starts from what the business actually checks and what the registered BAS or tax agent actually needs at quarter-end — gross margin by job or service line, wages as a share of revenue, GST collected against GST paid — and builds only the accounts that feed those numbers. Everything else collapses into a smaller number of correctly coded buckets. A chart with fifteen well-mapped accounts that reconcile cleanly to the BAS is more useful to both the owner and the agent than sixty accounts that map to whichever supplier happened to bill first.
Why it matters
| Without a system | With CapEasy |
|---|---|
| Month-end arrives whenever someone gets to it | Books closed on a fixed date, in the same shape every month |
| Unexplained transactions pile up in a suspense account until year-end | Every account reconciled to the statement, with discrepancies explained not plugged |
| Your accountant bills you to fix bookkeeping before they can do their own work | A short questions list instead of a year-end archaeology project |
| You cannot answer "how did we do last month" without a week of digging | Whoever files opens a finished file |
What we need from you
Financial
- Bank and card statements
- Sales invoices
- Supplier bills
- Expense receipts
- Payroll summaries
- Loan statements
System
- Chart of accounts
- Opening balances
- Accounting software access (read/write, least privilege)
- Multi-currency details if applicable
Context
- Prior period financial statements
- Your accountant’s coding preferences
- Anything unusual we should expect
How it runs, step by step
- Transaction recording & classification
- Daily transaction entry
- Revenue and expense categorisation
- Capital vs operating classification
- Ledger & trial balance
- General ledger review
- Sub-ledger reconciliation
- Chart of accounts restructuring
- Reconciliation
- Monthly bank and card reconciliation
- Discrepancy investigation, with a written explanation
- Multi-account and multi-entity reconciliation
- Catch-up & clean-up
- Working back from the last clean period
- An honest read on how far back the records support
- Rebuilding to current
Who does what
| Your CapEasy team | Chart of accounts cleanup, the reconciliations and reporting behind it, and the questions list that keeps it honest. |
| Your registered BAS or tax agent | Everything that carries a licence in Australia — rendered exactly as written: work out what goes on your bas, or advise you on it — under tasa 2009 that requires registration we do not hold. |
| You | One conversation with one named person, and the decisions that are genuinely yours. |
Chart of accounts cleanup in Australia
Chart structure and BAS/GST tax codes
Every account in Xero or MYOB carries a GST tax code — GST on Income, GST Free Income, Input Taxed, BAS Excluded, GST on Expenses, and so on — and that code, not just the account name, is what determines which label on the Business Activity Statement (G1, G10, G11, 1A, 1B) a transaction ultimately feeds. A chart where one income account mixes GST-free and taxable sales, or one expense account mixes GST-claimable and non-claimable purchases, forces the registered BAS agent to manually re-split transactions every single quarter. Rebuilding the chart so the correct GST code sits on the account itself doesn't determine anyone's GST liability — that determination is the registered BAS agent's under TASA 2009 s.90-10 — it just means the categories on the books already carry the code the BAS needs.
Fringe Benefits Tax categorisation
FBT runs on its own year (1 April to 31 March) and taxes benefits like motor vehicles, entertainment, and car parking differently from how those same costs are treated for income tax purposes. An expense account that blends genuinely deductible entertainment with FBT-exposed entertainment, or a motor vehicle account that doesn't separate business from private use, means the tax agent has to reconstruct the FBT-relevant detail from scratch at FBT return time. A cleanup that carries these as distinct accounts doesn't decide what's subject to FBT — that's the tax agent's call — it just keeps the raw detail available instead of buried inside one blended balance.
Fixed assets, Division 40 depreciation, and instant asset write-off eligibility
A blended "Plant & Equipment" account that nets purchases and disposals together strips out the acquisition date and cost detail a tax agent needs to apply Division 40 depreciation, or to assess eligibility for instant asset write-off or temporary full expensing on an asset-by-asset basis. A cleanup that adds an asset register — one line per asset, with cost and acquisition date — gives the tax agent what they need to make that assessment; it doesn't calculate the deduction or make the election itself.
Payroll liability accounts, superannuation guarantee, and Single Touch Payroll
PAYG withholding, superannuation guarantee (currently accruing toward each quarterly SG due date), and any salary-sacrificed super are distinct liabilities that the entity's registered BAS or payroll agent reports separately through Single Touch Payroll, each reconciled on its own schedule — SG doesn't share a due date or a reporting pathway with PAYGW. If the payroll software's postings land in one undifferentiated "Payroll Liabilities" account, reconciling that account to the STP finalisation or the quarterly super lodgment means unwinding a blended balance by hand every cycle before the agent's next report. Splitting the liability accounts by type means the ledger balances tie directly to what the registered agent reports — we don't file the STP report or the super lodgment ourselves.
What your registered BAS or tax agent receives from us
- A documented account crosswalk: every legacy account name, its new name or merge target, the GST tax code carried across, and the effective date of the change
- A comparison trial balance showing pre- and post-remap totals by account, proving no dollar moved off the books during the restructure
- The rebuilt chart of accounts with GST tax codes assigned so BAS labels (G1, G10, G11, 1A, 1B) reconcile without manual re-splitting each quarter
- A fixed-asset register with acquisition date, cost, and vendor detail per asset, ready for the tax agent's depreciation schedule
- Payroll liability accounts split by type (PAYG withholding, superannuation guarantee, salary-sacrificed super) reconciled to the most recent STP finalisation
- A dedicated Division 7A loan account isolating director/shareholder draws from general expense or drawings accounts, for the tax agent to assess
