Ironically, “double-entry bookkeeping” also has an extraordinary meaning. Surely many came across this expression in literature, and in the media, and in life. As a rule, it is associated with some kind of not quite clean business. However, this interpretation applies only to cases where this phrase is used in a figurative sense.
But he has another meaning, the original. And he is most often known only to specialists - economists, tax inspectors, lawyers. You can learn about the meanings of phraseology “double-entry bookkeeping”, as well as its origin, from the article.
Analysis of the first component
To understand the meaning of phraseology “double-entry bookkeeping”, it would be advisable to start by considering each of its components separately. Let's start with the main word in the studied phrase. With the noun "bookkeeping". In the dictionary it is presented in three versions.
- Firstly, it is a financial and economic term that denotes the theory and practice of accounting, covering information in monetary terms relating to the property and liabilities of a business entity. Example: “In the next semester, students begin to study accounting in theory, as well as practice in it.”
- The department in the institution, in the enterprise, which carries out the above accounting and submits the financial statements to the appropriate authorities. Example: "Arsentiev still had to get a salary certificate from the accounting department."
- In colloquial speech - this is the totality of any documents, reports. Example: “I think it’s better to be safe before checking in and check your bookkeeping again.”
In Russian, the word came from German, where it looks like Buchhalterei. It contains two parts. The first is Buch, which means “book,” and the second is halter, which means “hold”.
Continuing to consider the importance of phraseology “double-entry bookkeeping”, let us move on to another part of it.
Another component
The adjective “double” also has several meanings. Among them are the following.
- One that is doubled when it comes to quantity, size. Example: "Oleg was so hungry that he immediately ordered a double portion of omelet with mushrooms."
- Including two homogeneous units, parts, of an object. Example: “For safety reasons, it’s best to wear a double-lined jacket.”
- Carried out not in one, but in two steps. Example: “Double reflexion has a detrimental effect on the artistic process."
- Repeatable twice. Example: “In the dance, a double jump followed the coup.”
- Two, manifested in two forms. Example: “To avoid double understanding on the part of the audience, it is necessary to express more clearly.”
- Two-faced, insincere, having not only an obvious, but also a hidden side.
It is formed from the numeral two, which, in turn, comes from the Pre-Slavic language, where there is the form dva in the same meaning.
In addition to the studied, this token is part of other stable phrases, including double / double:
- citizenship;
- taxation;
- standard;
- agent;
- bottom.
Next, we turn to a direct examination of the question of what is the significance of “double-entry bookkeeping” in the literal and figurative sense.
Literally
The meaning of phraseology “double-entry bookkeeping” in the dictionary has several interpretations. As mentioned above, this expression is used both in the literal and figurative sense.
In the first case, this is the traditional method used in accounting. His invention is attributed to Luca Pacioli, an Italian mathematician. Its essence lies in the fact that each business and financial transaction is recorded twice in different registers. It is called "double entry".
Examples:
- "Double-entry bookkeeping, invented in time immemorial, is an indispensable tool used by accountants to this day."
- "If you believe the earliest evidence of the use of DV, which are currently known, it becomes clear that it is impossible to reliably establish the time of its origin."
- The main task of the Far East can be defined as the calculation of the financial result.
Next will be considered and use in a figurative sense.
Figuratively
In it, the studied expression is used in colloquial speech, when we mean someone's hypocritical, double-dealing actions.
Examples:
- "He was so happy when he exposed my double-entry bookkeeping, as if he had convicted me of conspiracy with criminals."
- "Among all of us, the DV concerning moral issues is very common, and this is the great inconsistency of human thinking."
Also in a figurative sense, which has a criminal connotation, the phrase in question is used in colloquial speech to denote a common way of tax evasion. It consists in the fact that there are two accounting records, one fictitious, for verification by the relevant authorities, the other real.
Examples:
- “Strict fiscal policies can lead entrepreneurs to go into the shadows, in other words, make them keep double-entry bookkeeping.”
- “To find out the true state of affairs in the company, the investor representatives had to sort out its Far East for a very long time, which by no means testified in favor of this company.”
For a better understanding of the phrase under consideration, we give expressions close to it in meaning.
Synonyms
These include such as:
- fraud;
- cheating;
- a scam;
- cheating;
- defamation;
- cheating;
- fraud;
- rogues;
- miner-machination;
- dishonesty;
- sell;
- fraud;
- doubtful enterprise;
- suspicious transaction;
- muhlezh;
- adventure;
- bench;
- cheating;
- slyness;
- dexterity;
- Lying;
- trick;
- quackery;
- dexterity;
- falsity;
- dishonesty.
Next, we will talk about the emergence of double-entry bookkeeping as a method.
Earliest use
Its first application, recorded in the history of mankind, is found among the Incas in a pile. This is a universal and comprehensive way of transmitting, as well as analyzing statistical data. And on its basis decisions were made. This system spanned their entire empire called Tauantinsuyu. Independently, the principle of double-entry was invented in Korea under the rule of the Korean dynasty in either the 11th or 12th century.
Origin in Europe
The first person to know that he used this method on the European continent was a Florentine merchant named Amatino Manucci. There are separate records made in 1299-1300 that he kept in the city of Salon de Provence. They relate to a division of a company owned by Giovanni Farolfi.
The oldest accounting books preserved in Europe, where the double-entry method was applied, were kept in 1340. These were accounts relating to the treasury of the Genoese republic. By the end of the 15th century This method was widely used by bankers and traders in cities such as Florence, Genoa, Venice, Lubeck.
But his systematic presentation is associated with the name of Luca Pacioli, whose years of life are 1445-1517. He was an Italian monk and mathematician and described the double entry in his book in 1494. Then this principle in the 16-17 centuries. Jerolamo Cardano, an Italian mathematician, and Simon Stevin, a Flemish mathematician and mechanic, developed in their writings.
Application principle
A double entry in accounting consists in the fact that any change in the state of the assets owned by the enterprise is reflected in two accounts and provides a general balance.
Each of the accounts on which the records are kept consists of two parts. The first is called debit, this is the left side, and the second - credit - the right side. The balance sheet consists of assets and liabilities, which at any time should be equal to each other. Moreover, the latter are equal to the sum of capital and liabilities.
The assets reflect information on the composition and value of property, as well as on the property rights of the organization, determined at the relevant date. Liabilities are an indication of the sources from which the assets arise.
Accounting entries
Each of the double entries is called a transaction, it changes both the asset and the liability and at the same time maintains balance. When assets increase, this is reflected in the debit of accounts. And when liabilities increase - on credit. The effect of the conservation law is observed: all debit amounts are always equal to loan amounts, thereby ensuring a total zero balance. This makes it possible to control the correctness of accounting - if there is no balance, then there is a mistake in it.
For example, if the founder contributes 10,000 rubles. in the authorized capital of the company, this means that it has an asset in the form of cash. At the same time, the company has an obligation to the founder. In this case, a double entry is made:
Debit on cash account (cash desk or bank) - Credit on authorized capital - 10,000 rubles.
The main thing in the double-entry bookkeeping method is that it can be used to track from what sources the funds are received and where they are directed. For example, when money is spent, this is reflected in the credit of the Bank or Cashier account. But at the same time, a debit record is made, which shows where they went. This can be a debt repayment or cash withdrawal according to the expense report. And also these records allow you to see the overall financial situation in the organization through the balance sheet.
Problem of principle
It lies in the fact that financial results that are reflected in accounting are distorted by inflationary processes taking place in the economy. According to experts, this is a big drawback of the double recording method. Moreover, there is an international reporting system. Some of its standards allow us to solve this problem using revaluation methods. But in this case, various accounting options are allowed, which entails ambiguity in the interpretation of the statements.