Sage Nominal Codes (also referred to as Nominal Ledger or General Ledger Codes) are used to record every entry against a relevant category of income or expenditure. These Nominal codes are then used by the ‘Chart of Accounts’ in Sage, which generates analysis reports and a set of management accounts. Everything that Sage does relies upon each transaction being recorded against the correct Nominal Code.
Now unless you also bought the ‘Mystic Meg Module’ when you first purchased and set up Sage Accounts, it’s likely that you didn’t have the foresight to leave gaps in your Nominal Structure where you might need them in the future, when your business or reporting requirements change.
The standard Nominal Code structure has the following setup;
- 0000-0999 fixed assets
- 1000-1099 stock
- 1100-1199 debtors
- 1200-1299 bank and cash
- 2100-2399 liabilities
- 3000-3099 capital and reserves
- 4000-4999 sales and other income
- 5000-5999 cost of goods
- 6000-6099 direct labour and direct costs
- 6100-6999 marketing and miscellaneous
- 7000 -7999 overheads
- 8000 - 9997 for end of period adjustments, depreciation, bad debts and other odd expenses
- 9998 is the suspense account and 9999 is for use by Sage only
There is no specific number to use for each item of income/expenditure, but there is a typical method of doing so: This technique ensures that each expenditure item has its own specific Nominal Code, but with an over-arching number range so you can easily see what that item was for (e.g., train tickets) and that it falls within the overall category range (e.g., overheads). So, in this example the Nominal Code could be 7216.
Nominal Codes make it easier and quicker to analyse where your business is making (and spending!) money and helps to file any reports to HMRC for the financial year via your Sage System. However, challenges can occur with such a system.
You can’t change the Chart of Accounts categories; you can change the description name, but not the fundamental grouping. You can also change a Nominal Code name, but not the Code number preventing you from sequencing and regrouping. This can result in additional work on the output from the system rather than the system outputting what you want – you end up doing what the software wants you to do, rather than what you need it to do.
What if you want to merge two codes together? In the system there are two Nominal Codes for the same thing i.e., Hotel Bookings and Accommodation, both with transactional history. In Sage you are not able to merge two Codes together which means that you will need to keep reporting on them both. What if you have Nominal Codes that are no longer needed, but are needed for something else? In Sage you are unable to change a Code, you can delete them, but you will lose the transactional data as a result.
Advantage Services’ team of developers created a Nominal Code Changer and Merger Add-on compatible with Sage 50 to solve such challenges. It enables Sage Users to;
- Edit and merge multiple codes with a click of button
- Retain full transaction history
- Enables the software to do what you want it to do, not what it wants to do
- Update your Sage 50cloud Accounts to reflect new business changes
It’s not just the Nominal Code Changers and Mergers add-on available, also on offer are;
- Customer Code Changer and Merger
- Supplier Code Changer and Merger
- Department Code Changer and Merger
- Product Code Changer
- Fixed Asset Code Changer
If you would like more flexibility when it comes to your Nominal Codes then either call our friendly team on 0330 335 0011 or email email@example.com