When a company opens a second bank account or works with a financial institution different from its main bank, the question arises: where to record these transactions in accounting? Account 513 of the General Chart of Accounts (PCG) precisely addresses this need. Linked to class 5 of financial accounts, it allows tracking operations conducted with credit institutions other than the company’s usual bank.
Account 513 and Account 512: a distinction that changes cash flow tracking
Most companies record their banking operations in account 512, that of the current bank. Account 513 comes into play whenever a flow passes through a distinct credit institution. Why this separation?
The PCG requires not to mix movements from different banking sources. Each financial institution must have its own account in the general ledger. If you use a single accounting line for two banks, bank reconciliation becomes a headache: balances no longer match the statements, and errors go unnoticed.
Account 512 records operations from the main bank. Account 513, on the other hand, accommodates those conducted via a supplementary credit institution. As specified in the definition of account 513 on BusiBoost, this account is linked to cash accounts in class 5 and follows the same operational logic as 512, but for a different banking scope.
In practice, an SME that holds a current account with its historical bank and a dedicated account for customer receipts with another institution will use 512 for the former and 513 for the latter. A sub-account per institution ensures the traceability of each flow.
Accounting operation of account 513: debit, credit, and reconciliation
Account 513 functions like a classic cash account. It is debited when the company receives funds into this account (customer receipts, incoming transfers). It is credited when outflows are recorded (supplier payments, bank fees, outgoing transfers).
Balance direction and consistency with the balance sheet
Under normal circumstances, account 513 shows a debit balance, which means that the company has funds with this institution. This balance appears on the asset side of the balance sheet, under the availability section.
A credit balance indicates an overdraft or an advance granted by the institution. In this case, the amount shifts to the liabilities side of the balance sheet, among short-term financial debts. This distinction directly impacts the reading of net cash flow at the end of the fiscal year.
Typical entries to know
- Receipt of a customer transfer into account 513: debit 513 and credit the customer account (411) to settle the receivable.
- Payment to a supplier from this account: debit the supplier account (401) and credit 513 for the amount paid.
- Internal transfer between the main bank and the secondary institution: use account 580 (internal transfers) as a pivot, debiting 513 and crediting 512 (or vice versa).
Account 580 prevents double counting during transfers between banks. Without this intermediary step, the same amount may appear twice in cash flow for a few days, until the transfer is effective on both sides.
Bank reconciliation of account 513: the verification that no one should neglect
Bank reconciliation involves comparing the accounting balance of 513 with the statement issued by the relevant financial institution. Have you ever noticed discrepancies between your accounting and a bank statement? This control is precisely what allows them to be identified.
Discrepancies often arise from three sources:
- Transactions recorded in accounting but not yet appearing on the statement (issued checks not cashed, transfers in process).
- Movements debited or credited by the bank but not yet entered in the accounting software (bank fees, interest, direct debits).
- Data entry errors: reversed amounts, transactions posted to the wrong account (512 instead of 513, for example).
A monthly reconciliation of account 513 protects against cumulative anomalies at the end of the fiscal year. Waiting until the annual closure to discover dozens of unidentified discrepancies significantly complicates the accountant’s work and extends the timeline for producing the balance sheet.
Common errors on account 513 and ways to avoid them
The first error, and the most common, is to group all banking operations into account 512 alone. This simplification skews the balances by institution and makes proper bank reconciliation impossible.
Another common pitfall: forgetting to match internal transfers via account 580. The transfer between two bank accounts of the same company is neither an expense nor a revenue. Treating it as such artificially inflates revenue or expenses in the cash journal.
Some companies also neglect the creation of sub-accounts. The PCG allows for the opening of subdivisions (5131, 5132, etc.) to distinguish each credit institution. This granularity facilitates tracking when the company works with three or four different financial organizations.
Non-compensation rule
The ANC regulation No. 2014-03, in its consolidated version as of January 1, 2024, reiterates the principle of non-compensation between assets and liabilities. A debit balance on account 513 cannot offset a credit balance on another. Each account must appear for its own value in the summary documents. This point is regularly checked during audits and tax inspections.
Account 513 is not complex in itself. Its difficulty lies in the rigor it demands on a daily basis: creating the correct sub-account at the opening of a banking relationship, posting entries in the right place, and reconciling each month. Companies that apply these three reflexes rarely notice discrepancies at the end of the fiscal year.