The general ledger is the census and the measurement of flows of the material facts, legal and economic of a Entreprise. The term of financial accountancy tends to replace " accountancy générale" , under the Anglo-Saxon influence ( financial accounting ).

Objectives

It is a tool of the Gestion;

• standardized, it makes it possible to evaluate and to control the Entreprise and to compare its performances with those of similar companies,
• chronological, it provides a recording of the operations which modified the inheritance of a Entreprise between two dates. It allows the comparative observation (state of the debts, credits, treasury, volume of businesses carried out, results released, paid dividends).
• obligatory, it allows:
• establishment of the tax benefit as a basis being used for calculation of the tax on the benefit or the income tax,
• with the thirds (leader, owners, current or potential lenders of the company) to measure its Solvency (capacity to pay its debts), its Profitability (capacity to be released from the benefit) and to be used as a basis for an evaluation of its value.
• incidentally, to produce information in order to establish the National accounting.
• With the chart, it allows:
• consultation and the edition of the details of the balances of the accounts of third.
• reliable and profitable monitoring of the respect of the conditions of payments of the thirds.

Short history

See also: History of accountancy

The sovereign Hammourabi of Babylon evokes the accountancy of the merchants in his laws. The Incas used ribbons of colors tied to keep the accounts; a node by operation, a color by product. The Romains used the terms expensa for the expenditure and accepted for the recettes.
1494: the Italian monk Luca Pacioli publishes with Venice his treaty on accountancy in “double part”.
1581: in Italy, the collegio of the Raxonati is the first company of comptables.
1673: in France, Jean-Baptiste Colbert imposes the bookkeeping comptables.
1807: code trade napoléonien.
1881: creation in France of the company of comptabilité.
1947: first chart of accounts in France

1962: Gilbert Bitsch, Project manager administrative and countable of the SACM of Mulhouse, invents the conversational conversation mode for the application of data-processing lettering and carries out the first positioning of the details of the balance of the accounts of third on a tabulator IBM 421, then on computer IBM 360.

2002: European payment on the application of the international countable standards to the group accounts of the companies with dimensions

Basic principle of the general ledger

The basic principle of the general ledger consists in recording all the economic events (also called flow) on two columns: the operation and its contrepartie.

The concept of flow answers a principle: any employment supposes a resource and it is not resource which does not find its employment.

The two columns are called respectively “flow” and “credit” . The “flow” is conventionally on the left, the “credit” being on the right.

Thus when an event intervenes in the company as sends it of an invoice (recording of an invoice) a flow must be recorded (entered) with the flow and the credit. The resource (credit) will have to always be equal to employment (flow), i.e. that the sums of the amounts recorded with the flow and the credit will have to be equal.

The following table explains how it is possible to break up a flow into several lines of entries:

A flow can thus influence what one has (it is the active ), which one owes (it is the passive ), the purchases (they are generally the loads), the sales (they are generally the produced ). It can be a real flow (goods and services), financier (money movement).

For example, for a bought machine 7000 € and a car bought 3000 € and paid immediately 10000 € per bank draft, one records the following writing:

The writing records the transfer of a money value (10000 € paid) against two goods which come to enrich the inheritance by the company for a value équivalente.

The list of the writings is related to a form of seizure called also Journal of the writings (this newspaper lists specifically by type of writings contrary to the simple form). To note however that the majority of accountancies are now held thanks to software which dematerialized the Newspaper (it is more systematically held under format paper).

They record the decisions of management which modify the structure of inheritance (inscription of credits like “doubtful debts”, assignment of the benefit in reserve, etc) or modify its value (recording of the Provision S for depreciation, for example).

The recording of the internal flows (transfers of value in the company during the production process) is not obligatory; it is possible for that to use the Cost accounting.

The countable organization in France

In France, the rules of the general ledger are binding at all the industrial companies and commercial, such as the articles L 123-12 have about it with L 123-28 of the Code the trade.
In the large majority of the cases, the writings passed in part doubles, any movement or variation recorded in accountancy is represented by one or of the writing (S) which connects what is carried to the flow and what is carried to the credit of the implied accounts. Very the small companies (TPE) can be satisfied with a partly simple accountancy, known as accountancy “of case”.

In France, the countable organization (operations to be recorded, presentation of the results) was a long time intended for to inform the thirds holders of right realities on the company (shareholders, lenders, State). Consequently, the first concern was the evaluation of the inheritance, with a legal presentation of the Bilan (see below): on a side, right acquired (property right on the credits and stocks, right of credit on the customers), other side the obligations (debts). This patrimonial vision, “which makes wonder on death last but massacre living it”, showed its limits in an economy moving which becomes more financial, less industrial. This is why French accountancy, in the course of change, approaches the international standards known as IFRS which privilege a financial approach, conforms to the Anglo-Saxon accounting practices. The objective of these new French countable standards is to facilitate a representation of the operations of the company closer to economic reality.

The chart of accounts

See also: Plane accountant

The term of plane accountant indicates in France a whole of rules of evaluation and behavior of the accounts which constitutes the standard of the general ledger. Among these rules, there is a plane accounts , i.e. the list of the accounts with their standardized classification. The usual language often reduced the chart of accounts to the only plan of accounts by thus occulting the other rules which are also important if not more.

The plan of accounts included in the plane accountant French is cut out in classes, accounts and subsidiary accounts. These elements are classified according to classification decimal, i.e. one finds at the head the classes (a figure, from 1 to 9) then the principal accounts (with two digits of which the first represents the class), so on. It is enough to add a figure following an account to obtain a subsidiary account. For example:

• Class 4 - Accounts of third

• Subclass 40 - Suppliers
• Account 401 - Suppliers, invoices to pay
• analytical Account 401/Wiki - Invoices to be paid in Wikipédia France

Entries

See also: Entry

A special logic conditions the correct making of the writings. The objective is triple: to make sure that economic, commercial or financial information is correctly seized (date of value, amounts, balance flow/credit, date of seizure), that the accounting records are traçables (classification, related seizure and filing) and sure (the seized data cannot be unobtrusive by accountants or other badly-disposed people, the people making the seizure being duly identified).

Current documents

1. the Journal of the writings counts the writings in the chronological order. Each one of it counts the sums Débit ées and Crédit ées, the number of the implied account, the date and an explanatory made out court.
2. the Plane accountant.
3. the Grand book counts the writings gathered by account: it makes it possible to justify their balances.

Summaries

With the end of the countable financial year that it is monthly or annual, accountancy produces the following summaries:

1. the balances general accounts, which presents the list of the centralizing accounts with the situation of each one: Flows amounts and rising appropriations; balances, debtors or creditors. It does not provide the details of the accounts of auxiliary accountancies, third etc which are the subject of additional balances.
2. the Assessment, which separately describes the liability and assets.
3. the Income statement, which recapitulates the produced load S and of the exercise; the balance between the loads and the products represents the benefit or the loss.
4. the appendix S with the assessment to comment on and supplement countable information.
5. a more or less elaborate Reporting according to the needs for the company which synthesizes the data of the cost accounting.

Taxes and taxes

The Entreprise is a collector of tax S for the State, in particular when it invoices with its customers of the VAT which it transfers in the State. Because it is about a debt towards a third, this tax must appear in its accountancy.

Auxiliary accountancies

To prevent that the Journal of the writings is not a “hold-all”, it is possible to create several newspapers according to the nature of the operations to be recorded, newspapers which one calls auxiliary. One thus will create sale the book, the newspaper of the purchases, the newspaper of banks, cases, the thirds (customer, suppliers, debtor-creditors various) and of the overheads. (One can also call them: Newspaper of the purchases, the sales, the cashings, the withdrawal and general, where one enters there all the other writings which do not appear in the other newspapers--In Quebec--)

Thus all the operations of the same nature are related to a specific newspaper which contains only this type of operation. It will be easier then to make the sum of all the operations of the same type and, in the event of research, to find a precise operation. It is also practical to use this system when several accountants have to work in team. In this way, the tasks can be distributed between those so that each one can fill out a newspaper.

At the end of the period (the month in general), the total of all these newspapers is deferred in a newspaper says “centralizing newspaper” or in the Large book.

Integrated business package or ERP

See also: Business package integrated

An integrated business package (PGI), called in English Enterprise Resource Planning (ERP), is a software which integrates the whole of the processes of management of a company, like the human stock management, countable management and financial, the decision-making aid, but also the sale, the distribution, the provisioning and the e-business.

The principle founder of a ERP is to build computer applications (pay, accountancy, stock management,…) with independent modules, while sharing a single and common database. This architecture slices with the preexistent situation in the applications under development existing specific before the ERP because the data from now on are standardized and shared, which eliminates the multiple seizures and avoids in theory the ambiguity of the multiple data of comparable nature.

Countable vocabulary

Active | Credit net | Damping | countable Balance | Requirement in working capital | Benefit | Assessment | case | Capacity of self-financing | Capital | Capital stable | load | Load to pay | Prepaid expense | Turnover | closure the accounts | Suspense account | Income statement | Account in T | Credit | Flow | Deficit | entry | Exercise | Exploitation | To make tally | Working capital | Large Book | IFRS | faithful Image | immobilization | Charge | Independence of the exercises | Inventory | auxiliary Newspaper | countable Newspaper | OD (various operations) | Passive | Plane accountant | partly double Accounts Department | Accounting policies | Produces countable | Produced to receive | Products noted in advance | Provision | Reserve | Bottom line | banking Bringing together | Balance | intermediate Balance of management | Table of financing | Treasury | Added-value | Inventory change | To ventilate | manual Lettering | countable Lettering | countable Lettering | Table of depreciation |

Related articles

• Accounts Department
• Cost accounting
• financial Analysis
• Management of quality
• creative Accounts Department

External bonds

• International accounting standard board, Organization of countable standardization international (in English)

• French Ministry of the Economy, Finances and Industry, gate on the accountancy of the companies.
• Information standardized on the functionality and the costs of the accounting packages French, foundation www.in-research.info

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