A great read for anyone wanting to learn more about bookkeeping :)
Originally posted on The Young Financier:
Bookkeeping at its best
“A double-entry bookkeeping system is a set of rules for recording financial information in a financial accounting system in which every transaction or event changes at least two different nominal ledger accounts.” This system has been around since the 14th century and was first published by Luca Pacioli, a Franciscan friar in the 15th century. Merchants in Venice were among the first to fully integrate their bookkeeping systems with this practice.
All of today’s popular bookkeeping and accounting software packages use the double-entry system which is far less exhausting than it was when entries were made in multiple journals with pens. The system is very effective and ensures the integrity of the bookkeeping with simple checks and balances. However, even with today’s software, errors can occur if the chart of accounts is not created accurately. There is also the element of human error that even with…
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