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Create General Ledger Accounts
Set up a chart of accounts for your organization's legal entities by creating general ledger accounts. Use these accounts to categorize your billing transactions by accounting type and report them in your company’s financial statements.
Example Illustrative sample chart of ledger accounts of a brokerage.
| Account Number/ Code | Account Name | Description and Use |
|---|---|---|
| Assets (1000-1999) | ||
| 1110 | Cash - Operating | Main bank account for operational cash, salaries, and expenses. |
| 1120 | Cash - Premium Trust | Legally separate account holding client premiums before remittance to carriers. A fiduciary asset. |
| 1210 | Premiums Receivable - Insured | Amounts due from policyholders for gross premium, fees, and taxes. |
| Liabilities (2000-2999) | ||
| 2110 | Accounts Payable - Carrier | Net premium (gross premium less commission) owed to the insurance carrier. |
| 2120 | Accounts Payable - Carrier Fees | Pass-through fees collected from the insured and owed to the carrier. |
| 2410 | Commission Payable | Commissions owed to internal producers or external sub-brokers for policies they have sold. |
| 2510 | Tax Payable | Taxes collected from insureds and owed to tax authorities. |
| Revenue (4000-4999) | ||
| 4110 | Commission Income | Primary revenue source. Earned for placing policies with carriers. |
| 4210 | Fee Income | Revenue from fees charged directly to clients for distinct services (e.g., consulting). |
| 4810 | Investment Income | Income earned from investments held in operating or other accounts. |
| Expenses (5000-5999) | ||
| 5110 | Commission Expense | Commissions paid to internal producers or external sub-brokers. |
| 5200 | Salaries & General Admin | Standard operating expenses like payroll, rent, and utilities. |
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