Transitioning to the AAHA Chart of Accounts (COA) is one of the best steps your hospital can take to improve financial clarity, enhance decision-making, and ensure accurate benchmarking. At Inventory Ally, we align with trusted resources like the KMS report and AAHA COA to guide practices toward smarter financial management.

This guide will walk you through the essential categories to include in your COA, helping you align with industry standards and get the most from your Inventory Ally reporting.

Recommended Account Categories for Your Bookkeeper

💰 Revenue Categories

Organize income by service type to better understand where your hospital is thriving.

Revenue Category	AAHA Code	Description / Examples
Professional Services	5000	Exams, consultations, and rechecks.
Pharmacy	5100	Medications sold or dispensed.
Laboratory	5200	In-house diagnostics and reference lab fees.
Dentistry	5600	Dental exams, cleanings, extractions, and dental x-rays.
Surgery	5500	All surgical procedures, including soft tissue and orthopedic.
Anesthesia	5400	All anesthetic services, including sedation and general anesthesia.
Imaging	5300	Radiographs, ultrasound, and other diagnostic imaging services.
Dietary	6200	Sales of prescription diets and retail pet food.
Boarding	6000	Revenue from boarding services (if offered).
Grooming	6100	Baths, nail trims, haircuts, and other grooming services (if applicable).
Wellness	5005*	Preventive care plan revenue (use if applicable—some clinics use a subcategory here).
Ancillary	6300–6400*	Retail sales, online pharmacy revenue, telehealth, rehab, alternative medicine, etc.
Discounts/Courtesy	6995	Discounts, write-offs, or courtesy services.

Note: Some categories, like Wellness or Ancillary, may fall under multiple AAHA codes depending on how your clinic defines them. You can also create subaccounts under these codes if needed for more granularity.

📊 Cost of Goods Sold (COGS)

COGS are directly related to services and products you sell. Breaking these out helps track inventory spending and profitability.

COGS Category	AAH Code	Description
Pharmacy Costs	6105	Medications, preventatives, injectables, and controlled drugs sold or dispensed to clients.
Laboratory Costs	6200	Reference lab costs (e.g., IDEXX, Antech), in-house test kits, blood tubes, and slides.
Dentistry Costs	6300	Dental-specific supplies like prophy paste, dental x-ray sleeves, dental burs, and instruments.
Anesthesia Costs	6600	Anesthetic drugs (injectable/gas), fluids, circuits, endotracheal tubes.
Surgery Costs	6500	Sutures, surgical drapes, instruments, scalpel blades, and surgical packs.
Medical Supplies Costs	6700	General-use medical items: syringes, needles, bandages, gauze, IV fluids.
Imaging Costs	6400	Radiology supplies like x-ray film, contrast agents, and ultrasound gel.
Dietary Costs	6800	Costs of prescription diets, retail pet food, and nutritional supplements.
Grooming Costs	6900	Shampoos, grooming blades, dryers, and table equipment.
Wellness Costs	6110	Vaccine vials, microchips, heartworm tests, flea/tick preventatives.
Ancillary Costs	6950	Supplies for services like laser therapy, acupuncture, rehabilitation, and telehealth.
Retail Costs	6803	Non-prescription items for resale: collars, leashes, treats, OTC supplements.

Tip: The KMS benchmarks track Cost of Professional Services as a % of revenue. Categorizing COGS clearly will improve your visibility and decision-making.

📈 Operating Expenses (OPEX)

Your operating expenses are the backbone of day-to-day hospital management.

OPEX Category	AAHA Code	Description / Examples
Payroll – Doctors	7000	Wages, benefits, and payroll taxes for veterinarians.
Payroll – Techs & Support	7100	Wages, benefits, and taxes for techs, assistants, and support staff.
Payroll – Admin & Mgmt	7200	Compensation for practice managers, admin staff, and receptionists.
Employee Benefits	7300	Health insurance, CE, uniforms, staff meals, gym memberships, etc.
Rent	7400	Monthly lease/rent payments; include CAM charges and property taxes if applicable.
Utilities	7500	Electricity, internet, phone, gas, water, trash, HVAC.
Marketing	7600	Advertising, social media, website design/hosting, and client communications.
Software/Subscriptions	7650	Inventory Ally, PIMS, payment platforms, time-tracking tools, email marketing, etc.
Office Supplies	7700	Paper, pens, labels, printers, postage, toner, and general clerical materials.
Repairs & Maintenance	7800	Equipment repair, facility maintenance, and janitorial services.
Insurance	7900	Business liability, workers’ comp, property, and malpractice insurance.
Professional Fees	7950	Accountant, legal counsel, consultants,and payroll processing fees.

Tip: For payroll costs, ensure each labor category includes wages + payroll taxes + benefits to get a full picture of labor burden.

🎯 Why This Matters

A properly structured COA helps you:

Benchmark against industry standards like KMS
Track service profitability more accurately
Make informed hiring and pricing decisions

📥 Next Step: We recommend sharing this guide with your bookkeeper as you If you’d like assistance with a P&L review, don’t hesitate to reach out – we’re here to help!