I want to know the difference between the words ledger and accounts. I don't work in an accounts department and know nothing of it. Can anybody explain it to me please?

The following definition is an excerpt from the Longman dictionary of contemporary English.


a book in which a business, bank etc records how much money it receives and spends



a)[plural] an exact record of the money that a company has received and the money it has spent


The ledger is the collection of accounts.

Ledger and accounts relate to standard accounting practice.

You first record any business transaction in a journal, which is a book or the electronic equivalent of a book. This leaves transactions in simple chronological order. The information recorded includes the date, amount, description, and two accounts. The accounts are identified by number, and their purpose is to categorize the transaction.

For example, suppose you pay a debt. One account categorizes the transaction according to which debt it is. The other account categorizes the transaction by the source of currency with which you paid it, such as a checking account.

Every journal entry is then copied to a ledger, which is a second book organized not chronologically but by account number. The entry is copied twice, so that it is listed under both account numbers in the ledger.

  • +1 for the (imo quite good) short introduction to accountancy. – I'm with Monica Dec 14 '12 at 7:12

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