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Sub-Accounts

What are Sub-Accounts?

Sub-accounts are child accounts created under a parent account in Chart of Accounts. It helps to track the income and expense(s) of the parent account effectively.

When do I use Sub-Accounts?

Let’s say you wish to track all your travel expenses and create an Expense account named Travel. You can then create sub-accounts under the parent account such as Lodging, Tickets, Cab charges, etc. Creating sub-accounts also helps you view certain reports in greater detail through report drill-downs.

A few other scenarios are described below where sub-accounts are beneficial for precisely tracking income or expenses.

Scenario 1: You maintain an Expense account for all the insurance you pay. If you wish to track insurance payments individually, you can create an Expense account named Insurance and add sub-accounts such as Property Insurance, Automobile Insurance, Other Insurances, etc., under the parent account. This helps track the amount paid for each type of insurance.

Scenario 2: You have a business with multiple sources of income. You create an account named Income and add sub-accounts such as Sales Revenue, Interest Received, Rentals Received, and Other Income. You can further create sub-accounts under Rentals Received, such as Beach View Property or Housing Flats, to track income in greater detail. 

Scenario 3: You own a book shop and create a Cost of Goods Sold account as the parent account. To track costs for different genres of books sold, you can create sub-accounts such as Fiction, Comedy, Drama, Horror, and Romance. This helps you track book costs by genre.

Create Sub-Accounts

You can create sub-accounts under a parent account either from Chart of Accounts or directly from certain other modules in Zoho ERP.

To create a sub-account from Chart of Accounts:

  • Log in to your Zoho ERP organisation.
  • Go to the Accounting module in the left sidebar.
  • Switch to Chart of Accounts tab in the modular bar.
  • Click + New Account in the top-right corner.
  • In the pop-up that appears, select the appropriate Account Type and give an Account Name.
  • Check the Make this a sub-account option.
  • Choose a suitable Parent Account and fill in the other details.
  • Click Save.

The sub-account will now be created under the selected parent account and listed in the Chart of Accounts.

Create Sub-Accounts from Other Modules

You can also create sub-accounts on the go in certain modules, such as Bills.

To create a sub-account from the Bills module:

  • Log in to your Zoho ERP organisation.
  • Go to the Purchases module in the left sidebar.
  • Select Bills module and click on the + New button.
  • Click on the Select Account drop-down menu.
  • Select Account for the line item.
  • Select New Account from the drop-down.
  • Click on + New Account and a pop-up page is displayed.
  • Select the appropriate Account Type and give an Account Name.
  • Check the Make this a sub-account option.
  • Choose a suitable Parent Account and fill in the other details.
  • Click Save.

The sub-account will be created instantly and available for use in the transaction.

In the same way, you can create sub-accounts in the modules such as Settings, Items, Credit Notes, Expenses, Recurring Expenses, Purchase Orders, Bills, Recurring Bills, and Vendor Credits.

The newly created sub-accounts will be listed under the parent account in the Chart of Accounts.

Note: You can create only five sub-accounts under a sub-account. However, you can create multiple sub-accounts under a parent account.   

Supported Account Types for Sub-Accounts

Currently, you can create sub-accounts under all the following Account Types:

  • Other Asset
  • Other Current Asset
  • Cash
  • Fixed Asset
  • Stock
  • Other Current Liability
  • Long Term Liability
  • Other Liability
  • Equity
  • Income
  • Other Income
  • Expense
  • Cost of Goods Sold
  • Other Expense

Sub-Accounts in Reports

The changes in credit and debit of the sub-accounts will be directly reflected in the Profit and Loss Report, Cash Flow Statement, Balance Sheet, Trial Balance, and General Ledger.

Zoho ERP allows you to view the reports either in Collapsed view or Expanded view.

  • Collapsed view displays the parent accounts
  • Expanded view displays a drill-down report along with the sub-accounts

View Sub-Accounts in Profit and Loss Report

To view the effect of Sub-Accounts in the Profit and Loss Report. To do so:

  • Log in to your Zoho ERP organisation.
  • Go to the Reports module in the left sidebar.
  • Navigate to Business Overview reports and select the Profit and Loss report from the list.
  • Click Expand All to view a drill-down report of the parent account along with the sub-accounts.
  • Click Collapse All to see only the parent accounts.

View Sub-Accounts in Other Reports

You can view the effect of Sub-Accounts in the Cash Flow Statement. To do so:

  • Log in to your Zoho ERP organisation.
  • Go to the Reports module in the left sidebar.
  • Navigate to Business Overview reports and select Cash Flow Statements from the list.

You can view the effect of Sub-Accounts in the Cash Flow Statement:

To view the effect of Sub-Accounts in the Balance Sheet:

  • Navigate to Business Overview reports and select Balance Sheet from the list.

The changes reflected by sub-accounts in the General Ledger can be viewed in Reports. To do so:

  • Navigate to Business Overview reports and select General Ledger from the list.

To view the effect of sub-accounts in the Trial Balance Report:

All sub-account transactions are accurately reflected across reports, ensuring detailed financial visibility in Zoho ERP.

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