The Double-Entry Systems’ Innovations and Limitations
Double-entry system allows you to balance your books. A double-entry system displays two columns, which often display debits (on the left) or credits (on the right). This allows the total amount to be added and subtracted. The two-column method allows for a running total and an update to the total sum.
Double-entry systems make it easier to check if a past-due account is settled. If totals are not run in manageable blocks, an accountant can tell if there has been an error or if the account is past due.
Individuals as well as governments are said to have access to double-entry system. Through our bank accounts, each of us can access a double entry system. We can prove to someone that we have not repaid them by debiting the account.
However, double-entry systems can be manipulated or “cooked,” as we have seen with corporate scandals (like…