diff --git a/ChangeLog b/ChangeLog
index 6ae8ef8556..ad5232beca 100644
--- a/ChangeLog
+++ b/ChangeLog
@@ -1,3 +1,10 @@
+2006-07-06  David Hampton  <hampton@employees.org>
+
+	* src/gnome-utils/dialog-account.c: When creating accounts from
+	the register, fix the name parsing logic to correctly handle the
+	case where the first new account will be the first child of its
+	parent.  Fixes #345771.
+
 2006-07-04  Derek Atkins  <derek@ihtfp.com>
 
 	* src/core-utils/gnc-glib-utils.h
diff --git a/src/gnome-utils/dialog-account.c b/src/gnome-utils/dialog-account.c
index fff37f75da..a31a6f453f 100644
--- a/src/gnome-utils/dialog-account.c
+++ b/src/gnome-utils/dialog-account.c
@@ -1555,10 +1555,14 @@ gnc_split_account_name (const char *in_name, Account **base_account)
   GList *list, *node;
 
   group = gnc_get_current_group ();
-  list = xaccGroupGetAccountList (group);
   names = g_strsplit(in_name, gnc_get_account_separator_string(), -1);
 
   for (ptr = names; *ptr; ptr++) {
+    /* Stop if there are no children at the current level. */
+    if (group == NULL)
+      break;
+    list = xaccGroupGetAccountList (group);
+
     /* Look for the first name in the children. */
     for (node = list; node; node = g_list_next(node)) {
       account = node->data;
@@ -1575,9 +1579,6 @@ gnc_split_account_name (const char *in_name, Account **base_account)
       break;
 
     group = xaccAccountGetChildren (account);
-    if (group == NULL)
-      break;
-    list = xaccGroupGetAccountList (group);
   }
 
   out_names = g_strdupv(ptr);