Guides · Bookkeeping
Double-entry bookkeeping basics
Double-entry bookkeeping rests on one idea: every transaction affects at least two accounts, and it is recorded twice — once as a debit and once as a matching credit. The two sides always balance.
The two-sided idea
In double-entry, nothing happens in isolation. Money paid to a supplier reduces cash and reduces what is owed; a sale on credit increases receivables and increases income. Each transaction touches two accounts, one debited and one credited, for the same amount.
That symmetry is the whole system: total debits always equal total credits, because every entry has a matching other side.
Why it keeps the books honest
Because every entry has two sides that must agree, the books check themselves. If the totals do not match, something was recorded incompletely, and the imbalance points to it. Single-entry — just a list of amounts — offers no such check.
This self-checking quality is why double-entry has outlasted every fashion in accounting for centuries.
How Lekha reflects both sides
Lekha is built as a two-sided ledger — receivables and payables tracked together, with a net-position view — so the money owed to you and the money you owe are seen as two sides of the same picture.
Lekha records what your documents say and tracks the money on both sides — what you owe and what you are owed. It records and tracks; it does not replace your accountant.
Questions
- What is double-entry bookkeeping?
- A system where every transaction is recorded twice — a debit in one account and a matching credit in another — so the two sides always balance.
- Why does every entry have two sides?
- Because a transaction affects at least two accounts. Recording both sides keeps total debits equal to total credits, which lets the books check themselves.
- How is double-entry better than single-entry?
- Single-entry is just a list of amounts with no built-in check. Double-entry's matching sides catch incomplete entries when the totals fail to agree.