Accounting journal basics

Wondering what exactly your company's accounting journal, or journal book, should contain?

Accounting is a discipline that enables you to codify and keep a record of the accounting operations carried out every day in the course of your business. And the accounting journal ensures the traceability of all these operations.

This is why it is a mandatory accounting document for the vast majority of companies. Let's take a closer look.

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What is an accounting journal?

Accounting journal: definition

Mandatory for all businesses and commercial companies, the accounting journal (also known as the journal book, general journal or centralizing journal) is a document used to :

• chronologically record all the company's accounting operations, on both the credit and debit sides,
• organize entries for the current accounting period according to their nature (purchase, sale, cash flow, etc.).

Accounting journal: debit and credit

The journal is a table showing, among other things:

• The debit column 👉 the debit corresponds to what is due, to cash outflows. For a company, this means, for example:
  • amounts due to suppliers,
  • bank loans.

• The credit column 👉 a contrario, credit is defined as cash inflows. On the company side, this includes :
  • cashed customer invoices,
  • fixed assets or inventories still in the company's possession.

☝️ Important: to comply with the principle of double-entry bookkeeping, transactions must be balanced: the sum of debits = the sum of credits.

Example of an accounting journal

In practical terms, what does a journal book look like?

To help you, here's an example:

This example of an accounting journal gives you an overview of the required information, i.e. :

• the account number of the transaction,
• the date on which the transaction was carried out,
• the name of the transaction, or accounting entry ☝️ Note that this must be associated with the number of the corresponding accounting document,
• the amount (in the national currency of the country where the company's head office is located), in the debit or credit column.

The different types of subsidiary accounting journals

To record accounting entries and associated supporting documents, the company may use different journals, depending on the type of accounting. Called subsidiary journals, they are then grouped together in the centralizing journal.

Some companies choose to do this to facilitate the flow of information into the main journal.

Here are the different types of subsidiary accounting journals:

• Cash accounting journals. In cash accounting, there are at most two different types of journal:
  • the cash journal, comprising the cash journal and the bank journal;
  • the miscellaneous operations journal (for other operations not included in the cash journal).
    
• Commitment accounting journals. In commitment accounting, several subsidiary journals are generally established, the main ones being :
  • the purchase journal, which includes accounting entries for invoices received from suppliers and suppliers of fixed assets;
  • the sales journal, which includes accounting entries for invoices sent to customers;
  • the cash journal, for entries relating to bank and cash movements;
  • the miscellaneous operations journal (or OD journal), for entries not recorded in the above-mentioned journals.

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How do I keep an accounting journal?

To keep your accounting journal correctly, remember to apply the following best practices!

💡 Opt for the most appropriate method, depending on the amount of information to be processed. In other words, ask yourself whether you're going to keep a single accounting journal or consider subsidiary journals instead.

💡 Choose the medium on which you'd like to make your journal book. Indeed, the law authorizes the keeping of accounting journals in either digital or paper format (in a register, for example). However, they must not contain any blanks or erasures. For this reason, it's best to use an Excel-type computer file, or even dedicated software:

• Indy automates and simplifies accounting management for the self-employed, synchronizing with your bank in real time to retrieve your data, transform it into accounting lines and classify it in the right accounts. You benefit from an accounting journal that Indy automatically completes throughout the year! Indy guides you step by step through the tax closing process, enabling you to electronically file your tax return with the tax authorities or your AGA.
  
  
• Sellsy Facturation & Gestion simplifies pre-accounting for VSEs and SMEs by automating the production of entries across different accounting journals (purchase, sale, etc.). Time savings guaranteed! Your accountant or chartered accountant then has access to your account and this information to manage more complex operations.

💡Don't forget any mandatory information. As a reminder, these are:

• the account number concerned by the accounting entry,
• the transaction date,
• the wording of the accounting entry,
• the number of the associated accounting document,
• transaction amount, credit or debit.

💡 F inally, the accounting journal is used to control accounting entries. That's why you need to make sure you keep it for at least 10 years, from the end of the financial year concerned.

To find out more about keeping an accounting journal, read our article on how to keep an accounting journal.