To explain how Profit & Loss and Balance Sheet account categories work in Magnifi, and how to add, amend, or delete categories so reports display correctly.
When setting up your Chart of Accounts for the first time.
When you need to add or amend Income categories.
When you want to add additional Balance Sheet categories.
When allocating specific accounts (e.g., Interest, Depreciation, Dividends, or Tax) to ensure they appear in the correct reporting line.
These are the headings that appear on the Profit & Loss Projection.
All categories are fixed except Income, which you can modify.
Go to Chart of Accounts.
Click Add Income Category (appears above the Account Category title).
Enter the Income Category name and click Save.
The new category will now appear in the drop-down list, and you can associate accounts to it.
To amend or delete an Income Category:
Click Add Income Category again.
Click the category name to edit, or the red cross to remove it.
These are the headings that appear on the Balance Sheet Projection.
Default category titles are fixed, but you can add additional categories.
Go to Chart of Accounts.
Click Add Category.
Enter the Category Name and select the Type.
The new category will now appear in the drop-down list, and you can assign accounts to it.
To amend or delete a category:
Click Add Category again.
Click the category name to edit, or the red cross to remove it.
Allocate your Interest or Depreciation accounts to the matching Account Category.
They will then display separately in the Profit & Loss under Interest or Depreciation.
By allocating to these categories, Magnifi will automatically report EBITDA in the Profit & Loss.
💡 Tip: If you don’t want to show EBITDA, allocate Interest and Depreciation to Other Expense. The Profit & Loss will then show only Operating Profit and Net Profit.
Allocate your Income Tax Expense account to the Account Category Income Tax Expense so it appears as its own line in the Profit & Loss.
This projection is usually based on the expected tax payable on profits (e.g., a percentage of profit before tax). This needs to be manually entered.
The expense is mapped to the Balance Sheet account Income Tax Payable (or similar), which tracks the liability owed to the tax office.
To show actual cash payments, add a sub-account under Income Tax Payable and assign payment timings there.
This reduces the liability on the Balance Sheet.
It also ensures the payment shows correctly in the Cashflow Forecast.
Allocate your Dividend account to the Account Category Dividends.
This ensures dividends display separately in the Profit & Loss Projections.
Only Income categories are flexible in the Profit & Loss; all other headings are fixed.
For Balance Sheet reporting, add categories where needed for clarity.
If you have multiple files, account categories added in one file will also appear in others, ensuring a consistent account structure.
There are two similar categories:
Income – Other: relates to other operating income and appears at the top of the Profit & Loss.
Other Income: relates to non-operating income and appears below Operating Profit.
You cannot remove an Income Category until all accounts in that category are reassigned.