A chart of accounts is a systematic listing of all the accounts used by an organization to record financial transactions. It serves as a framework for organizing financial data, enabling easy access and management of accounts. Each account is assigned a unique identifier, often categorized into assets, liabilities, equity, revenues, and expenses. This structure helps businesses maintain clarity in their financial reporting, ensuring that all transactions are properly classified. A well-designed chart of accounts not only streamlines accounting processes but also supports effective decision-making by providing valuable insights into the financial health of the organization.