Set up alternative GL accounts (Xero)

Set up alternative GL accounts (Xero)

Overview

Alternative general ledger (GL) accounts let you allocate income from different products, customers, and branches to different accounts in your Xero chart of accounts.

Find out how to set up alternative GL accounts.

In Xero, your chart of accounts is a list of all the accounts in your general ledger. Keeping a well-organized chart of accounts helps you allocate transactions and build detailed financial reports.

But when you sync sales orders and credit notes from Cin7 Omni to Xero, their value is allocated to your default sales account only – that is, the Sales account under Default Accounts in your Xero integration settings.

By using alternative general ledger (GL) accounts, you can allocate the value of sales and credits to different accounts in Xero. Each alternative GL account maps to an account in your chart of accounts, so that when you sync sales orders and credit notes to Xero, the value of each line item is allocated to its effective alternative GL account.

Before setting up alternative GL accounts, set up your Xero chart of accounts. Then create and assign your alternative GL accounts to products, customers, or branches.

Create alternative GL accounts

Each alternative GL account map to one Xero account. You need that account’s Account Code to create the alternative GL account:

  1. Log in to Cin7 Omni as an administrator.

  2. From the Accounting menu in the navigation, open your Xero integration.

  3. Open the Admin > Chart of Accounts tab.

  4. Find the account and note its Account Code.

Now create your alternative GL account:

  1. From the user menu, open Settings.

  2. Under Accounting, open Alternative GL Accounts.

  3. Select Add New.

  4. Set Active to Yes.

  5. Enter a number into Sort – this is the alternative GL account’s index in your list of alternative GL accounts on the previous page (you can leave it as is).

  6. Enter a Name for your alternative GL account – we suggest using, or at least including, the name of the account in your general ledger.

  7. Enter the Account Code into Account Number.

  8. Set Purchases or Sales to Sales.

  9. Optionally, assign a COGS account (COGS Account), tracking option (Tracking Categories Name and Tracking Categories Option), and tax rate (Tax Rate Code and Tax Rate) too (see below for details).

  10. Select Insert.

Optional settings

If you want to allocate the cost of goods sold (COGS) of sales revenue allocated to an alternative GL account to a specific COGS account, find the Account Code of that COGS account (on the Admin > Chart of Accounts tab on your Xero integration dashboard) and enter it into the COGS Account.

If you want to assign a Xero tracking option to an alternative GL account, enter the name of the option into Tracking Categories Option field and the name of its category into the Tracking Categories Name field. Find out more about tracking options.

If you want to assign a Xero tax rate to an alternative GL account, find the Code and Rate of the tax rate (on the Admin > Tax Rates tab on your Xero integration dashboard) and enter the Code into the Tax Rate Code field and the Rate into the Tax Rate field.

Assign alternative GL accounts

You can assign alternative GL accounts to products, customers, or branches.

Note that, because alternative GL accounts can be assigned to products, contacts, and branches, line items can inherit alternative GL accounts from the products, the contact, or the branch of a transaction.

Therefore, line items prioritize how they inherit alternative GL accounts:

  1. A line item will inherit its product’s alternative GL account, if any.

  2. A line item will inherit the contact’s alternative GL account if and only if the product has no alternative GL accounts.

  3. A line item will inherit the branch’s alternative GL account if and only if neither the product nor the contact has an alternative GL account.

  4. A line item will not inherit an alternative GL account if and only if neither the product, the contact, nor the branch has alternative GL account – in which case, the line item will be allocated to the default account (that is, the Sales account under Default Accounts in your Xero integration settings).

Assign alternative GL accounts to products

Before you first assign an alternative GL account to a product, you’ll need to enable the accounting settings for products:

  1. From the navigation, select Products.

  2. Open Settings.

  3. Open the General tab.

  4. Set Accounting to Yes.

  5. Select Save.

Now you can assign alternative GL accounts to products:

  1. From the navigation, select Products.

  2. Select the product to open its page.

  3. Under Accounting, set Sales Account to an alternative GL account.

  4. Select Save and Close.

The product’s alternative GL account is shown in the Account column of the line item on each transaction. There you can change it manually.

Assign alternative GL accounts to customers

  1. From the navigation, select CRM.

  2. Select the customer to open their page.

  3. Under Accounts, set Alternative GL Account to an alternative GL account.

  4. Select Save and Back.

The contact’s alternative GL account is shown under Contact on each transaction. There you can change it manually.

Assign alternative GL accounts to branches

  1. From the navigation, select CRM.

  2. Select the branch to open its page.

  3. Under Branch Details, set Alternative GL Account / Cost Center to an alternative GL account.

  4. Select Save and Back.

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