A general ledger is a comprehensive record of all financial transactions that occur within an organization. It serves as the primary source of financial information for an organization and is used to prepare financial statements, such as balance sheets and income statements. The general ledger contains all accounts, including assets, liabilities, equity, revenue, and expenses. Each transaction is recorded in the general ledger using a double-entry accounting system, which ensures that debits and credits are balanced. The general ledger is an essential tool for financial management, as it provides a complete picture of an organization’s financial health. It allows executives to make informed decisions about budgeting, forecasting, and resource allocation. The accuracy and completeness of the general ledger are critical, as errors or omissions can lead to financial misstatements and legal issues. Therefore, it is essential to have robust internal controls and processes in place to ensure the integrity of the general ledger.
