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      Setting up Chart of Accounts

      Step-by-Step Guide to Setting Up Your Chart of Accounts in Momentum AMS & QuickBooks

      Step 1: Understanding the Chart of Accounts

      The chart of accounts is a structured list of financial accounts used by an insurance agency to categorize transactions. It helps track revenue, expenses, liabilities, and assets. In Momentum AMS, the chart of accounts is essential for syncing financial data with QuickBooks to maintain accurate bookkeeping.

      Step 2: Preparing Your Chart of Accounts

      Before integrating with QuickBooks, you need a properly structured chart of accounts. If you don’t have one, we provide an Excel template that includes the most important financial categories, such as:

      • Accounts Receivable (AR) from clients and finance companies

      • Accounts Payable (AP) to MGAs and insurance carriers

      • Commission Income and Commission Expenses

      • Agency Fees and Trust Accounts

      You can modify the template as needed to fit your agency’s structure, but keeping a clear organization will help with reporting and reconciliation.

      Step 3: Setting Up Your Chart of Accounts in QuickBooks

      New QuickBooks users will find that QuickBooks includes a generic chart of accounts designed for general businesses. Since insurance agencies require specialized categories, we recommend importing a customized chart of accounts. You can either manually create accounts or use QuickBooks’ import function.

      Step 4: Importing the Chart of Accounts

      To import your chart of accounts into QuickBooks, follow these steps:

      1. Log into QuickBooks.

      2. Navigate to the ‘Import Data’ section.

      3. Select ‘Chart of Accounts’ and upload the provided Excel file.

      4. Review the list and uncheck any duplicate or unnecessary accounts.

      5. Click ‘Next’ and complete the import.

      If QuickBooks detects any errors, it will highlight them, allowing you to make necessary corrections before reimporting.

      Step 5: Verifying and Organizing Accounts

      After importing, review your chart of accounts to ensure everything is categorized correctly. Key items to check include:

      • The presence of a Trust Account to separate agency funds from client funds.

      • Properly structured Accounts Receivable and Payable categories.

      • Accurate Commission Income and Expense tracking.

      If any default QuickBooks accounts are unnecessary (e.g., ‘Cost of Goods Sold’), you can deactivate them to streamline your records.

      Step 6: Syncing with Momentum AMS

      Once your chart of accounts is set up in QuickBooks, you can connect Momentum AMS to begin syncing transactions. This integration allows for automatic journal entries and financial tracking, reducing manual bookkeeping efforts.

      Conclusion

      Setting up a proper chart of accounts is crucial for managing financial transactions efficiently between Momentum AMS and QuickBooks. By following these steps, your agency will be well-prepared for accurate bookkeeping and seamless financial reporting. If you have any questions, feel free to reach out to our support team for assistance.

       

      Chart of Accounts