Since one of the functions of the chart of accounts is to provide
consistency in financial presentations over time, the idea of updating
a chart of accounts is somewhat problematic.  It needs to be
approached with some care.

The process should include a restatement of prior years' financial
results using the new chart, going back as far as the organization
ususally does for planning purposes (say, three to five years).

I've also found that organizations frequently use different categories
for budgeting than they do for accounting.  If this is the case, how
the new accounts relate to existing budget categories is another area
that will need to be addressed.

Regards,
Dan Prives
Where Most Needed
The Charity Industry Blog
http://www.wheremostneeded.org

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