The ICommander G/L Chart Structure extends far beyond the components of the
actual account numbers. Each component must first be defined in a Level Codes
File before it may be used in an actual account number. The Level Codes
are assigned to Standard Level Groups and the Standard Level Groups may then
be assigned to Group Classification Codes. You may also setup Alternate
Level Code Groups and Group Classification Codes and within those definitions
may even cross-reference to an external coding scheme.
The ICommander approach to the G/L Account Structure provides amazing flexibility for reporting as any of the background codes and groups may be used for selection or sorting or for the level of detail printed. Producing a summary report is as simple as electing not to print the report in full account number detail. Picking the object account component, the object group background code, or any other applicable background code as the level of detail, will result in automatic summarization.
Some accounting packages force you to plan out your primary financial statements as you build your chart of accounts by assigning various codes and classifications and others provide a separate report writer to do the same. The ICommander reporting is automatic once the background codes are in place and you never need to worry about remembering to update report definitions as changes are made to your chart of accounts.
The failsafe approach used by ICommander was developed as a result of the experience of the primary ICommander designer with other approaches requiring constant maintenance and monitoring to assure that financial statements were accurate. The background codes also let you easily implement additional grouping as needed as you simply define a new set of alternate codes, assign to the standard codes or groups, and then you are ready to run a new report that uses them.
ICommander watches for any maintenance of the background codes, groups and classifications files and will force you to validate your chart of accounts whenever anything is changed. This assures that you never will have an orphan account number that does not fit into the background groups.
The background codes approach is very useful for a growing business. If you started out with a 1-digit location code because you had just 3 similar operating locations you wanted to analyze, ICommander will let you expand the number of digits when you exceed 9 (any chart component may be up to 6 digits). If the expanding number of locations needs to be grouped geographically, you just add a grouping code for each State, Region, or whatever is useful and then assign each location to one of the codes. If you are also diversifying and would like to analyze based on the nature of business at each location, you simply setup another alternate group code and assign it to each location. If the standard level groups were not used (N/A) when you just had 3 locations, you can redefine them to now be geographical areas.
If operations continue to expand and your original geographic codes were for various regions but now need to also be by State, you may either reconfigure your geographic codes OR, if the region codes can be assigned to State Codes, you can define another grouping. If you used the standard level groups for your initial geographical coding, you also now have the option of defining codes to classify the standard groups (which state is each location in).
The background codes also fit in well with ICommander G/L's ability to store up to 99 years of comparative monthly history. Changes in the nature of your business, new management, or regulatory authorities may want a different presentation. ICommander includes a Chart Rearrange Function to deal with this reality. It enables you to restructure your chart of accounts as needed and then have ICommander take apart all years of history already on file and put it back together to match the changes needed. Comparability is preserved by the background codes.
The background codes also facilitate consolidation of separate divisions, funds, etc. at a summary level that is common to all operations. This is true both when the separate funds or entities are within the same G/L Company-ID or in separate ones. ICommander provides a consolidation function to bring together several disparate G/L's under separate Company-ID's into a combined one. It does this by having one set of background codes that are consistent across all such G/L's and using that for the level at which the companies are consolidated.
The ability to cross-reference ICommander background codes to external codes can also prove very useful to avoid restructuring your chart of accounts whenever some external reporting requirement forces you to use its codes. A real life example of this was when the State of Michigan assigned Building Numbers to every School District Building in the State and then required that electronic reporting include the State's Building Numbers. A particular school district will have just a few buildings and actually putting the State's Building Code in as an actual account number component would result in entering 6 digits where maybe only one is needed. ICommander's background code cross-referencing makes it a simple matter to use your own short building codes in the chart of accounts but then automatically convert these to the external code required by the State when creating electronic files or reports for the State.
This also avoids the potential problem of the external codes themselves being
changed over time. If they were actually part of your actual account number,
you would be facing major chart rearranges whenever they were changed. The
background code approach will require just a few minutes to adapt your entire
chart for any changes.