Modify chart of accounts with existing data

Oct 30, 2018
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United States

I'm currently building an accounting software and I have some doubts regarding changes in the charts of accounts. On the system, there are several operations that you can perform on the chart of accounts:

  1. Add a new account.
  2. Update account details like the name, nominal code and description.
  3. Archive accounts.
  4. Delete accounts if they have not been used.

I'm having problems regarding the operation #2. I don't know what's the best way to handle existing data if that operation occurs. For example, if the user introduced a journal entry with a line referring to the account "667 Advertising expenses", but then the user changes the nominal code and the name of that account to "883 Marketing expenses", what would you expect to see when listing the journal entries, reports, balances, and so on?

At this moment, after checking Xero and SAGE, I'm storing the original account's name and nominal code "667 Advertising expenses" but displaying the current account details "883 Marketing expenses". That means that if you filter by "883 Marketing expenses" you would see the journal entry with the line ""883 Marketing expenses". Same thing happens for reports, balances, and so on. That's what Xero and SAGE are doing. However, I was planning on including the previous account info somehow when listing the journal entries:

883 Marketing expenses
originally posted as 667 Advertising expenses

What do you think? Is it a good idea or is it not necessary?

Is usual to change the name and/or nominal codes of an account? If that happens, is it ok to delegate the responsibility of keeping the "consistency" of the information to the final user?

Thanks in advance for all the help!


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