When naming accounts in NetSuite, it’s important to follow best practices to ensure that the accounts are easily understood and consistent across the chart of accounts. Here are some naming conventions that you can follow (best practices) for accounts in NetSuite:
- Use descriptive names: Use standard account type names that clearly describe the account, such as “Office Rent Expense” or “Salaries and Wages.”
- Be concise: Use short names that are easy to read and remember. Avoid using long, complicated names that may be difficult to understand.
- Use standard terminology: Use standard accounting terminology that is commonly used in your industry. This will ensure that your accounts are easily understood by others and consistent with industry norms.
- Use consistent naming conventions: Use consistent naming conventions for all accounts to ensure that they are easy to find and understand. For example, you might use the same format for all expense accounts such as “Expense: [Name of Expense]” or “Rent Expense: [Name of Property].”
- Avoid abbreviations: Avoid using abbreviations that may be unclear or confusing. Instead, use the full name of the account or a commonly accepted abbreviation.
- Use account numbers: Assign account numbers to each account in your chart of accounts. This will make it easier to navigate and sort your accounts and ensure that they are in the correct order.
When the Use Account Numbers preference is enabled, four-digit account numbers are automatically associated with existing accounts as follows:- 1xxx – Asset accounts
- 2xxx – Liability accounts
- 3xxx – Equity accounts
- 4xxx – Income accounts
- 5xxx – Cost of Goods Sold (COGS) accounts
- 6xxx – Expense accounts
- 8xxx – Other Income accounts
Account numbers can be alphanumeric with a maximum of 60 characters.
By following these naming conventions, you can create a chart of accounts in NetSuite that is consistent, easy to understand, and meets the financial reporting needs of your business.