In this video, we are going to show how you can group your Chart of Accounts using Account Groups and Parent/Child accounts. CustomBooks allows you to have an unlimited number of Account Groups along with Parent and Child accounts to help you organize your Chart of Accounts.

Account Groups and Parent/Child accounts work together to create a structured and flexible Chart of Accounts that improves both organization and reporting. Account Groups serve as the top-level categories in your account types—Assets, Liabilities, Income, and Expenses—and determine how accounts are presented on financial statements like the Balance Sheet and Income Statement. Account Groups are for organization, and you will not post directly to the group, but only to the accounts in the group. Within these groups, Parent and Child accounts allow you to break down financial activity into meaningful levels of detail.

Let's start by setting up some Parent/Child accounts. As you can see in the list, we have a few accounts set up for different marketing purposes. We have Radio, Television, Google, Facebook, and Print. When we open the Income Statement, we see all of these accounts listed out with their balances. If we wanted to see the Income Statement with all the marketing expenses grouped together, we would set each of these accounts to be a Child Account of our Advertising and Marketing account.

Back in the Chart of Accounts, let's open up Radio Ads. Here in this dropdown, we can select Advertising and Marketing as the Parent Account and save. Now in the header, we see that Radio is a Child Account, and when we open Advertising and Marketing, we see that it is a Parent Account.

If we follow the same steps for the other accounts to make them Child Accounts of Advertising and Marketing, when we run the Income Statement again, we can see the hierarchy has changed. Radio, Television, Google, Facebook, and Print are now nested under Advertising and Marketing. Each account is listed individually, but at the bottom we see the total for Advertising and Marketing. This is how the Parent/Child accounts work. Unlike Account Groups, you will be able to post directly to the Parent Accounts.

Now we can take a look at the Account Groups and how we can add accounts to our groups. Here we have a group created, Selling, General & Administrative Expenses, and we see that the account type is Expense. Using these options, we can determine what accounts we see in the list.

Currently, we are set to All, so we see all of the accounts that have Expense as the account type. If we change this to In Current Group, we see only the accounts that are in the group. If we click on In Any Group, we will see the list of expense accounts that are in any group. Lastly, if we click on Not in a Group, we will see the expense accounts that have not been assigned to a group.

If we want to add an account to a group, we can click here and a green check mark will appear, showing that the account has been added to the group. For Child Accounts, you have to add the Parent Account, then all the associated Child Accounts will be added as well. You will not be able to have either a Parent or Child Account in different groups.

Once the accounts have been added to the group, returning to the Income Statement in Present View clearly reflects the updated structure. Accounts are ordered numerically by code and organized by hierarchy, making the flow of the report easy to follow. The hierarchy is visually represented through indentations, allowing you to quickly distinguish between Parent and Child accounts.

Marketing accounts now appear under Selling, General & Administrative Expenses, with individual totals shown first, followed by the grouped total. All totals are clearly called out, enabling users to efficiently scan the report and understand both the account structure and overall balances at a glance.

That’s how Account Groups and Parent/Child accounts help organize your Chart of Accounts and improve reporting. By grouping related accounts and using a clear hierarchy, you can simplify your financial statements while still keeping detailed insight where it matters.