Chart of Accounts for UAE SMEs: A Practical Template

Your chart of accounts is the spine of your finance function. Get it right and every report flows naturally; get it wrong and you spend years patching reports. This is the structure we use for UAE SMEs across industries.

Numbering scheme

Use a five-digit numeric scheme so you have room to grow. We recommend: 1xxxx for assets, 2xxxx for liabilities, 3xxxx for equity, 4xxxx for revenue, 5xxxx for direct costs, 6xxxx for operating expenses, 7xxxx for other income, 8xxxx for other expenses. Within each block, leave gaps of 100 between major categories so you can insert later.

Avoid descriptive codes (CASH-01, REV-DUBAI). They look helpful but break sorting and reporting. Stick to numeric codes with descriptive names, '11000 Cash and bank' beats 'CASH'.

Asset accounts

11000 series: cash and bank (one sub-account per bank, one for petty cash). 12000 series: receivables (trade, related party, employee, other). 13000 series: prepayments and accrued income. 14000 series: inventory (raw, WIP, finished goods, goods-in-transit). 15000 series: fixed assets at cost, with parallel depreciation accounts.

Resist the urge to create asset accounts per project or per customer. Use cost centres or tracking categories for that, the chart of accounts gets unwieldy fast otherwise.

Liability and equity accounts

21000 series: trade payables, accrued expenses, customer deposits. 22000 series: VAT (output, input, payable, receivable as separate accounts). 23000 series: corporate tax (current and deferred). 24000 series: payroll liabilities (gratuity, WPS holding). 25000 series: bank loans and lease liabilities, current vs long-term.

Equity: 31000 share capital, 32000 share premium, 33000 retained earnings, 34000 current year P&L (auto-balancing). For each shareholder, do not create a separate equity account, track shares in your share register and report movements only.

Revenue and expense structure

Revenue: keep at least one account per major product line or service line. Add tracking dimensions (cost centre, customer, project) rather than splitting accounts. 41000 service revenue, 42000 product sales, 43000 subscription revenue, 49000 other revenue.

Operating expenses: group by function rather than by vendor. 61000 personnel costs, 62000 facilities, 63000 technology, 64000 sales and marketing, 65000 professional services, 66000 travel, 67000 office, 68000 other. Each block has 5-15 sub-accounts depending on size.

This guide is general information, not professional advice. For situations that involve specific facts, talk to your accountant, or hire one of ours from the marketplace.