If the financial statements (Income Statement, Balance Sheet, etc.) are the summary reports of your business's financial story, the General Ledger (GL) is the complete, unabridged book. It is the master record of every single financial transaction that has occurred in your business, organized by account.
While you may not need to review the General Ledger daily, understanding what it is and how to use it is essential for tracing specific transactions, troubleshooting discrepancies, and providing detailed records for audits or due diligence.
To view the General Ledger in Dappr, navigate to Accounting from the main menu, select Reports and statements, and then click on General ledger in the sub-menu.
What is the General Ledger?
The General Ledger is the central, authoritative record for all your accounting data. Every time you reconcile a transaction, create an invoice, or log an expense in Dappr, the system automatically creates a journal entry. The General Ledger is the complete collection of all these journal entries, sorted by the accounts they affect.
Think of it this way:
Your Chart of Accounts is the list of all possible categories (e.g., Bank Account, Sales, Office Supplies).
The General Ledger is a detailed, chronological list of every transaction that has been posted to each of those categories.
For example, the "Office Supplies" account in the General Ledger will show every single purchase of office supplies, with the date, description, and amount for each.
How to read the General Ledger
The Dappr General Ledger report displays a running list of transactions for each account in your Chart of Accounts. For each transaction, you will see several key columns:
Date: The date the transaction occurred.
Description: A description of the transaction.
Debit: The amount debited to the account. In the double-entry bookkeeping system, a debit increases asset and expense accounts, and decreases liability, equity, and revenue accounts.
Credit: The amount credited to the account. A credit increases liability, equity, and revenue accounts, and decreases asset and expense accounts.
Balance: The running balance of the account after each transaction.
Every transaction you see in the General Ledger will affect at least two accounts, ensuring that the books always remain in balance according to the accounting equation (Assets = Liabilities + Equity).
Why is the General Ledger important?
While summary reports like the Income Statement provide a high-level overview, the General Ledger provides the granular detail needed for several key functions:
Troubleshooting and Verification: If a number on your Income Statement or Balance Sheet looks incorrect, the General Ledger is the first place you should go to investigate. You can drill down into the specific account and see every single transaction that makes up that summary number. This allows you to pinpoint errors or miscategorized items quickly.
Providing a Detailed Audit Trail: For financial audits, tax preparation, or investor due diligence, accountants and auditors will rely on the General Ledger as the primary source of truth. It provides a complete and transparent record of all financial activity, demonstrating the integrity of your bookkeeping.
Understanding Business Operations in Detail: By reviewing the ledger for a specific account, you can get a detailed understanding of spending or revenue patterns. For example, reviewing the "Software Subscriptions" ledger can show you exactly how much you are spending on each tool and when those payments are due.
In Dappr, the General Ledger is built automatically as you work. Every time you reconcile a transaction, Dappr handles the debits and credits behind the scenes, ensuring your GL is always accurate and up-to-date. While you don't need to manage it manually, knowing how to access and read this report gives you complete transparency and control over your company's financial records.