Managing linked accounts

Accounts & Banking

• Equity account for current earnings: This account helps you track your profit (or loss) for the current financial year. At the start of a new financial year the balance of this account is transferred to the equity account for retained earnings. You can’t change this account. See also Income allocation.
• Equity account for retained earnings: This account helps you track the cumulative profit (or loss) of the business up to the start of the current financial year. At the start of a new financial year, the balance of the equity account for current earnings is transferred to this account. You can’t change this account. See also Income allocation.
• Equity account for historical balancing: This account is used to balance your accounts list and balance sheet report. As a rule, the value of your assets must equal the combined value of your liabilities and equity. If you haven’t entered all of your opening balances, or a value was entered incorrectly, a “balancing” amount will be allocated to the Historical Balancing account. Once you enter all your opening balances accurately, this account will return to zero. See also Entering opening balances.
• Bank account for electronic payments: This is a clearing account that’s used to keep track of electronic payments that haven’t been processed yet. The payments are cleared from this account and withdrawn from your bank account when you pay your employees or suppliers electronically.
• Bank account for undeposited funds: (feature not yet available) This is a clearing account that you use to keep track of receipts that haven’t been deposited directly to your bank account (such as cash and cheques).

Sales

• Asset account for tracking receivables: This account is used to track the total amount that customers currently owe you. The balance will increase automatically when you record an invoice, and decrease when a payment is made.
• Bank account for customer receipts: This is the default bank account into which customer payments are deposited. If you have more than one bank account for this purpose, select the one that will be used most. You can select a different bank account when recording the receipt.
• Income account for freight: This is the account you want to use for freight you charge to customers on invoices. Amounts you enter into the Freight field on a sale will be allocated to this account.
• Liability account for customer deposits: (feature not yet available) This account is used to track deposits you collect from customers when recording a sales order. If you enter an amount in the Paid Today field of a sales order, the amount will be allocated to this account.
• Expense or cost of sales account for discounts: This account is used to track payment discounts you give to customers when entering their payments.
• Income account for late charges and surcharges: This account is used to track finance charges you collect from customers. By default this account is used for customer surcharge payments for online invoice payments.

Purchases

• Liability account for tracking payables: This account is used to track the total amount you currently owe to suppliers. The balance will increase automatically when you record a bill, and decrease when you make a payment.
• Bank account for paying bills: This is the default bank account from which bill payments are made to suppliers. If you have more than one bank account for this purpose, select the one that will be used the most. You can select a different bank account when recording the payment.
• Liability account for item receipt: (feature not yet available) This account tracks the stock you receive from a supplier without a bill on a Receive Items transaction. This account will be cleared when you record the bill for the stock received.
• Expense or cost of sales account for freight: This account is used to track freight amounts you pay to suppliers.
• Asset account for supplier deposits: This account is used to track deposits you make on purchase orders. If you make a payment against a purchase order, it's considered a supplier deposit and the amount will be allocated to this account.
• Expense (or Contra) account for discounts: This account is used to track payment discounts suppliers give you which you enter when making a supplier payment. Learn about Supplier discounts.
• Expense account for late charges: (feature not yet available) This account is used to track finance charges you pay to suppliers.

Payroll

Choose your country to learn more about the payroll linked accounts:

How do I turn off a linked account?

Only linked accounts with a checkbox can be turned on or off. To turn off one of these linked accounts, deselect the checkbox.

For example, if you don't pay deposits on supplier purchase orders, you can turn off this linked account by deselecting this checkbox.

Why can’t I turn off some linked accounts?

Some feature-level accounts can only be changed but not turned off, even if you don't use the feature they're linked to. These linked accounts are the ones without a checkbox next to them on the Linked accounts page, like the Asset account for tracking receivables and the Bank account for customer receipts.

Also, if you've selected one of the optional linked accounts (those that have a checkbox next to the linked accounts such as I charge freight on sales) and used it in a transaction (for example, you've recorded a supplier deposit on a purchase order), then you can't turn off that linked account option. This ensures that MYOB can maintain a complete audit trail.

Why can’t some linked accounts be changed? 

There are two feature-level linked accounts that can’t be changed - The Current Year Earnings and Retained Earnings accounts. These must be kept as is. If you have a partnership or trust and want to split the current or retained earnings, see Income allocation to learn how to best handle this requirement.

Why are some linked accounts not shown as linked in the accounts list?

The accounts list only indicates the linked accounts that are set up at the feature level. When setting up items and other records, you can specify additional linked (default) accounts—see 'Record-level linked accounts' above. These accounts won’t be shown as linked in the Accounts page.

Can I change a linked account at any time?

You can, but it can affect your reports, especially reconciliation reports. These reports assume the linked account has not changed during the selected reporting period, and so may not show complete information.

What are linked accounts for tax paid and tax collected?

When you buy and sell, any applicable tax/GST needs to be tracked. This helps with your tax reporting obligations. This is handled in MYOB by using Tax codes.

Some types of tax codes require linked accounts for tracking tax collected and tax paid. The balances of these linked accounts represent how much tax you have collected on sales and how much tax you have paid on purchases. These values are used when lodging your activity statements (Australia).

If you're not sure which accounts should be used for tracking tax collected or tax paid, check with your accounting advisor.