It's primarily our coding engine, but there are other advantages.
One of the questions we frequently receive is why the chart of accounts in Cheqbook is not more flexible. This is an excellent and important question. When we were developing Cheqbook, we made a deliberate decision to implement a predetermined chart of accounts, and there were several compelling reasons behind this choice.
There are three primary benefits to this approach:
First, our yellow categorization engine requires a set chart of accounts. This innovative system relies on a vendor type flag that we receive from your bank with each transaction. Each vendor flag is automatically assigned to a pre-existing account within the chart. Because the engine is designed to work with these predetermined accounts, it is not capable of categorizing transactions into accounts that you create yourself. This ensures that the categorization process is seamless, accurate, and efficient, but it does require that the chart of accounts remains fixed.
Second, this approach allows for a much faster setup experience for new users. When you first begin using Cheqbook, the chart of accounts is already established and ready for you to use. You are not required to spend time coming up with your own accounts from scratch. This makes it easier and quicker to get started, and as you become more familiar with the system, you can determine which additional accounts you may need and add them at your convenience.
Third, having the same chart of accounts provides consistency for all Cheqbook users. This consistency is especially valuable for users who manage more than one company or for bookkeepers who work with multiple different businesses. With a standardized chart, it becomes much easier to switch between companies or clients, as the structure remains familiar and uniform across all accounts.
To further support your unique needs, Cheqbook allows you to create an unlimited number of personalized accounts. You also have the flexibility to group any of these accounts—whether they are pre-set or user-created—into subgroups. This grouping feature is particularly useful for reporting purposes, as it enables you to generate subtotals on both Profit & Loss and Balance Sheet reports, giving you greater insight and control over your financial data.
Of course, we recognize that there are some disadvantages to this approach:
One limitation is that you cannot rename the existing accounts. This restriction exists because changing the account names could cause the yellow categorization engine to categorize transactions incorrectly. In addition, you are not able to turn off or delete the existing accounts, as doing so might result in the categorization engine assigning transactions to an account that is no longer active or visible. (Hint: one way we made our list of possible accounts easy to navigate is with excellent filtering: just type a portion of the account name you want and the available options quickly filter down to the account you need).
Despite these limitations, we ultimately decided that maintaining a set chart of accounts was the right choice for Cheqbook. While most other accounting software solutions have moved away from this approach, we firmly believe that it still offers significant value for our users by enhancing automation, streamlining setup, and ensuring consistency across multiple businesses or clients. We are proud to be different and confident that our approach continues to benefit our users in meaningful ways.
Comments
3 comments
Yellow is only good for the first time a transaction is recieved, if a user is using the system correctly. most all businesses use the same vendors over and over, with similar transactions, so after one or two weeks most all transactions should be coming in blue if a user cares about his proper books,. so as a trade off to do this (not allow manipulation of current assets) or and not allow the inability to have more than 100 custom accounts because it minimizes the effectiveness of "yellow" is, in my opinion, a weak reasoning to not allow 250 or more custom accounts that would not respond to yellow.
Yes, you are correct. As you categorize transactions the blue engine learns and takes over.
However for new users and new vendors the yellow engine gives them a solid preliminary answer.
Also, this gets into the issue of how varied our users "keep" their books. We have users that are religious about going all green (eventually "reviewing" everything) and others at the other extreme that only categorize their reds.
Plus 250 custom accounts with data would turn a financial statement into an 8 page monster.
At the time we settled on 100 it was still early before launch during testing, when it possible to change. Now it would be very very challenging.
I have added some custom accounts to my chart of accounts (for instance, under Income, I have added "Grants and Awards.") However, they don't seem to function! I can't seem to categorize any transaction this way. I start typing the name of this account, and it simply doesn't appear in the drop-down. What am I doing wrong?
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