Editing General ledger

{{Short description|Bookkeeping (accounting) record}}
{{Bookkeeping}}
{{Accounting |expanded=}}

[[File:Главная_книга.png|thumb|Sample Ledger book]]
In [[bookkeeping]], a '''general ledger''' is a bookkeeping [[ledger]] in which accounting data are posted from [[General journal|journal]]s and aggregated from [[subledger]]s, such as [[accounts payable]], [[accounts receivable]], [[cash management]], [[fixed assets]], purchasing and projects.<ref>{{cite web |title=What is a General Ledger? |date=February 2022 |url=https://www.businessaccountingbasics.co.uk/general-ledger/}}</ref> A general ledger may be maintained on paper, on a computer, or in the cloud.<ref>{{cite web | url=https://blog.workday.com/en-us/2022/understanding-the-basics-what-general-ledger.html | title=Understanding the Basics: What is a General Ledger? | date=16 December 2022 }}</ref> A ledger account is created for each account in the [[chart of accounts]] for an organization and is classified into account categories, such as income, expense, assets, liabilities, and equity; the collection of all these accounts is known as the general ledger. The general ledger holds financial and non-financial data for an organization.<ref>{{cite web|url=http://controller.vpfa.fsu.edu/sites/default/files/media/doc/Accounting/Accounting_Terms_Concepts.pdf|title=Accounting Term Concepts|access-date=12 February 2017|archive-date=27 December 2015|archive-url=https://web.archive.org/web/20151227053147/http://controller.vpfa.fsu.edu/sites/default/files/media/doc/Accounting/Accounting_Terms_Concepts.pdf|url-status=dead}}</ref> Each account in the general ledger consists of one or more pages.  It includes details such as the date of sale, invoice number, customer details, and the amount due. This ledger helps businesses track outstanding receivables and manage [[cash flow]] efficiently. An organization's [[statement of financial position]] and the [[income statement]] are both derived from income and expense account categories in the general ledger.<ref>{{cite web |url=http://www.ecdoe.gov.za/documents/learners/self-study-guides/accounting-gr10.pdf |title=National Curriculum Statement Accounting Guide Grade 10 |access-date=26 February 2017 |archive-date=22 April 2016 |archive-url=https://web.archive.org/web/20160422230808/http://ecdoe.gov.za/documents/learners/self-study-guides/accounting-gr10.pdf |url-status=dead }}</ref>

==Terminology ==
The general ledger contains a page for all accounts in the chart of accounts<ref name=accountingscholar>{{cite web |url= http://www.accountingscholar.com/ledger-accounts.html |title= Chapter 9.3 - General Ledger and Charts of Accounts |website=Accounting Scholar |access-date=28 February 2017}}</ref> arranged by account categories. The general ledger is usually divided into at least seven main categories: assets, liabilities, owner's equity, revenue, expenses, gains and losses.<ref>{{cite web |title=Inputs to Accounting |url=http://kolibri.teacherinabox.org.au/modules/en-boundless/www.boundless.com/accounting/textbooks/boundless-accounting-textbook/introduction-to-accounting-1/what-is-accounting-17/inputs-to-accounting-110-6831/index.html}}</ref> It is the system of record for an organization’s financial transactions.<ref>{{cite web |url=https://blog.workday.com/en-us/2022/understanding-the-basics-what-general-ledger.html |title=Understanding the Basics: What Is a General Ledger? |website=Workday Blog |date=16 December 2022 |access-date=31 August 2023}}</ref>
The main categories of the general ledger may be further subdivided into [[subledger]]s to include additional details of such accounts as cash, accounts receivable, accounts payable, etc.

The extraction of account balances is called a [[trial balance]]. The purpose of the trial balance is, at a preliminary stage of the [[financial statement]] preparation process, to ensure the equality of the total [[debits]] and [[Debits and credits|credits]].<ref>{{cite web|url=http://accounting-simplified.com/trial-balance.html#purposetrial|title=What is a Trial Balance? |access-date=5 March 2017}}</ref>

==Process==
Posting is the process of recording amounts as credits (right side), and amounts as debits (left side), in the pages of the general ledger. Additional columns to the right hold a running activity total (similar to a chequebook).<ref>{{cite web |url=http://highered.mheducation.com/sites/dl/free/007471340x/100328/sample_ch08.pdf|title=Posting to general ledger accounts |access-date=26 February 2017}}</ref>

The general ledger should include the date, description and balance or total amount for each account.

Because each bookkeeping entry debits one account and credits another account in an equal amount, the [[double-entry bookkeeping system]] helps ensure that the general ledger is always in balance, thus maintaining the [[accounting equation]]:

: {{math|1= Assets = Liabilities + (Shareholder's or Owner's equity).}}<ref name="meigs">Meigs and Meigs. ''Financial Accounting, Fourth Edition''. McGraw-Hill, 1983. pp.19-20.</ref><ref name=accountingscholar/>

The accounting equation is the mathematical structure of the [[balance sheet]]. Although a general ledger appears to be fairly simple, in large or complex organizations or organizations with various subsidiaries, the general ledger can grow to be quite large and take several hours or days to audit or balance. 
In a manual or non-computerized system, the general ledger may be a large book. Organizations may instead employ one or more [[spreadsheet]]s for their ledgers, including the general ledger, or may utilize [[Accounting software|specialized software]] to automate ledger entry and handling. When a business uses [[Enterprise resource planning|enterprise resource planning (ERP)]] software, a financial-features module produces subledgers and the general ledger, with entries drawn from a database that is shared with other processes managed through the ERP.

== References ==
{{Reflist}}

[[Category:Accounting journals and ledgers]]
[[Category:Accounting terminology]]