I n t e r a c t I v e t e X t foundations in Accountancy/ acca financial accounting (ffa/FA) bpp learning Media is an acca approved Content Provider

 

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   What are control accounts? 

A control account keeps a total record of a number of individual items. It is an impersonal account 

which is part of the double entry system. 

 

A 

control account

 is an account in the nominal ledger in which a record is kept of the total value of a 

number of similar but individual items. Control accounts are used chiefly for trade receivables and 

payables. 

(a) A 

receivables control account 

is an account in which records are kept of transactions involving 

all receivables in total. The balance on the receivables control account at any time will be the total 

amount due to the business at that time from its receivables. 

(b) A 

payables control account 

is an account in which records are kept of transactions involving all 

payables in total. The balance on this account at any time will be the total amount owed by the 

business at that time to its payables. 

 

Although control accounts are used mainly in accounting for receivables and payables, they can also be 

kept for other items, such as inventories, wages and salaries, and cash. The first important idea to 

remember, however, is that a control account is an account which keeps a total record for a collective 

item (eg receivables), which in reality consists of many individual items (eg individual trade receivables). 

A control account is an (impersonal) ledger account which will appear in the nominal ledger. 

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CHAPTER 14  

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  CONTROL ACCOUNTS