General Ledger

[Dave H]

Thanks for explaining the distinction Michael.

So I take from all this that the General Journal/General Ledger distinction
is an historical distinction no longer in real use with the advent of
computerised accounting software.  It still doesn't explain for me why the
intent is to rename everything that says General Ledger to General Journal
when General Ledger appears to be the more widely used terminology, at
least in my world.  I work in a large organisation with multiple branches
and many system users having a large Finance Section using dedicated
financial software who will only refer to the "General Ledger", hence my
confusion :-)

Cheers Dave H.


On 26 February 2018 at 02:34, Mike or Penny Novack <
stepbystepfarm at dialup4less.com> wrote:

> On 2/24/2018 4:54 PM, Dave H wrote:
>
>> Well from my point of view that is confusing.  Nobody in my world refers
>> to
>> a "General Journal" we refer to the "General Ledger" and we do journals
>> :-)  I've never actually heard the term general journal used anywhere
>> before until this discussion over the weekend !!!
>>
>> Cheers Dave H.
>>
>
> Old time distinction (not that long ago, within my lifetime)
>
> In the really old days (hundreds of years ago) there would be just one
> journal into which all transactions of the enterprise would have been
> entered in chronological order. But as enterprises grew in size and
> complexity, this became burdensome. Can you imagine a merchant enterprise
> that might have thousands of sales a day (perhaps spread over a dozen
> stores). How could some poor bookkeeper get those entered into a single
> journal.
>
> Imagine a solution where at each store was a journal to record the sales
> transaction (a subsidiary journal) while at company headquarters a main
> journal maintained by the company bookkeeper. Call that journal the
> "general journal". So at the agreed time interval (every day, every week,
> etc.) the bookkeeper at each store would transmit a single transaction to
> headquarters (total receipts, total sales) and the head bookkeeper would
> enter those transactions into the "general journal". Things like "petty
> cash" might have their own journal (and ledger) and once a month a
> transaction to "general journal" to the totals of each account and the
> replenishment of cash. Notice that this also allowed restriction of access
> to the main books. The clerks in each store only could access the local
> books.
>
> The term "general journal" (and "general ledger") refer to the MAIN books.
> The confusion for you is that most of us using gnucash are doing so for
> small enough enterprises that we don't need to partition the books this
> way. The only ledger IS the "general ledger" (no subsidiary ledgers) and
> the journal is virtual in any case. We do enter the transaction (and then
> post it) but in effect enter it on already posted form in the ledger an the
> computer can figure out what would have been the journal entry that
> resulted in this. The developers COULD have chosen to have us enter
> transactions into a journal and have the computer auto post those to the
> ledger, but most of us would have found that less direct in terms of
> looking at stuff.
>
> BUT (and this is an important but) perhaps many who are asking for
> "multiple people simultaneously accessing gnucash books" are doing so
> because "too much work for one person" don't know the history, how this WAS
> handled with subsidiary books and gnucash could easily handle it that way.
> With the added benefits that the "local bookkeepers" (the clerks in the
> stores, etc.) can enter the transactions without having access to the main
> books and that main books can avoid the clutter of unnecessary details.
>
> Michael D Novack
>
> Michael D Novack
>
>
>
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