Chart of Accounts
Every transaction your business records — a sales invoice, a payment, a bank transfer — lands in a specific account. The Chart of Accounts in Udyot ERP is the master list of all those accounts, organised into a logical hierarchy that keeps your financial reports accurate and your auditor happy. Setting it up correctly from day one is the single most important step in your accounting setup in Nepal.
Groups and Ledgers: the two-level structure
Udyot ERP organises accounts into two layers:
- Account Groups — broad containers such as “Current Assets”, “Sundry Debtors”, “Sales Accounts”, or “Indirect Expenses”. Groups hold other groups or ledgers but do not carry transaction balances themselves.
- Ledgers — the individual accounts where transactions are actually posted, for example “NIC Asia Bank — Current Account”, “Office Rent”, or “VAT Payable”. Every voucher line must point to a ledger.
Every group (and every ledger inside it) belongs to one of four natures: Assets, Liabilities, Income, or Expenses. The nature controls whether a balance appears on the Balance Sheet or the Profit & Loss statement, and whether it is shown on the debit or credit side of your Trial Balance. You cannot change the nature of a seeded group — doing so would silently misplace every report downstream.
What Udyot seeds for your company (NFRS-aligned defaults)
When you create a new company in Udyot ERP, the system automatically seeds 29 NFRS-aligned account groups and a set of standard ledgers so you can start posting vouchers immediately. The table below shows the top-level groups:
| Group | Nature | Parent |
|---|---|---|
| Capital Account | Equity | — |
| Loans (Liability) | Liability | — |
| Current Liabilities | Liability | — |
| Sundry Creditors | Liability | Current Liabilities |
| Duties & Taxes | Liability | Current Liabilities |
| Provisions | Liability | Current Liabilities |
| Fixed Assets | Asset | — |
| Investments | Asset | — |
| Current Assets | Asset | — |
| Stock-in-Hand | Asset | Current Assets |
| Sundry Debtors | Asset | Current Assets |
| Cash-in-Hand | Asset | Current Assets |
| Bank Accounts | Asset | Current Assets |
| Sales Accounts | Income | — |
| Direct Incomes | Income | — |
| Indirect Incomes | Income | — |
| Purchase Accounts | Expense | — |
| Direct Expenses | Expense | — |
| Indirect Expenses | Expense | — |
Standard ledgers such as Cash, VAT Payable (13%), VAT Input Credit (13%), TDS Payable, Sales Account, and Purchase Account are also pre-created. These cover the requirements under Nepal’s 13% VAT rate and TDS deduction rules as set by IRD.
Creating a new account group
You may need sub-groups to organise ledgers more precisely — for example, a “Wholesale Customers” sub-group inside Sundry Debtors to track your distributor balances separately from retail customers.
- Go to Accounting → Masters → Account Groups.
- Click + New Account Group.
- Enter a name (for example, Wholesale Customers).
- Select a Parent Group (for example, Sundry Debtors). The Nature field fills in automatically from the parent and cannot be changed — this ensures the sub-group rolls up correctly to the parent on reports.
- Click Save.
The new group immediately appears in your Trial Balance and Balance Sheet under its parent, with a zero balance until you create ledgers inside it.
Creating a new ledger
Add a ledger whenever you need a new account — a new bank account, a new expense category, or a project-specific income stream.
- Go to Accounting → Masters → Ledgers.
- Click + New Ledger.
- Enter the Ledger Name (for example, Global IME Bank — Savings).
- Select the Account Group it belongs to (for example, Bank Accounts).
- If this is a bank ledger, enable the Tag as Bank toggle. This unlocks the Bank Reconciliation flow for this ledger — without it, the ledger will be silently excluded from bank reconciliation reports.
- Set the Opening Balance in NPR if you have a balance to bring in from your previous system. Enter the amount and select Debit or Credit. For asset and expense ledgers, opening balances are normally Debit; for liabilities and income, normally Credit.
- Click Save.
You can edit the opening balance freely as long as the company has no posted period close. Once a period is closed, opening balances are locked and corrections must be made via a Journal Voucher (NAS 8 §41 prior-period error process).
Editing an existing ledger or group
- Go to Accounting → Masters → Ledgers (or Account Groups).
- Click the name of the ledger or group you want to change.
- Click Edit.
- Update the fields you need — name, parent group, or opening balance.
- Click Save.
You cannot delete a ledger that has voucher entries. Archive it instead — it will no longer appear in voucher entry pickers but its historical balances remain intact on all reports.
Party ledgers: customers and vendors
In Udyot ERP, each customer is a ledger under Sundry Debtors and each vendor is a ledger under Sundry Creditors. You do not create these manually under Ledgers — instead, go to Accounting → Masters → Parties and create a Party with type Customer or Vendor. The system creates the corresponding ledger automatically and links it to the correct group.
You can organise parties further by placing them in a sub-group (for example, moving “ABC Trading Pvt. Ltd.” into the “Wholesale Customers” sub-group you created). The party’s balance will still roll up through Sundry Debtors to the Balance Sheet correctly. Parties cannot be moved to groups outside Sundry Debtors or Sundry Creditors.
Nepal-specific note: VAT, TDS, and IRD accounts
The seeded Chart of Accounts includes dedicated ledgers for Nepal’s statutory requirements:
- VAT Payable (13%) under Duties & Taxes — accumulates output VAT on sales at the standard 13% rate set by IRD.
- VAT Input Credit (13%) under Current Assets — accumulates reclaimable input VAT on purchases.
- TDS Payable ledgers — one per TDS section (for example, Section 15-2 at 1.5% for services with PAN) — accumulate amounts deducted from vendor payments that must be deposited with IRD monthly.
These ledgers are used automatically by Sales, Purchase, Payment, and Receipt vouchers. You can rename them to match your internal terminology but should not change their group or nature, as the VAT Return and TDS Return reports depend on their placement.
Opening balances and keeping them square
If you are migrating from Tally or another system, enter your closing balances from the previous system as opening balances in Udyot. The total of all Debit opening balances must equal the total of all Credit opening balances — this is the fundamental double-entry requirement. Go to Reports → Opening Balance to check: if the two sides do not match, an amber banner will appear showing the imbalance amount. Click Auto-square to post a correction to the system “Opening Balance Square” ledger and restore balance before you begin posting vouchers.
Dates in Udyot ERP use Bikram Sambat (BS) format. The opening balance date will typically be the last day of your previous fiscal year — for example, 2081-12-30 (end of FY 2081/82) if you are starting Udyot from FY 2082/83. See Nepal fiscal year and BS calendar for more on how Udyot handles Nepali dates and fiscal years.