Double‐Entry Accounting

Double-entry accounting is a foundational bookkeeping method where every financial transaction affects at least two accounts, ensuring that the accounting equation (Assets = Liabilities + Net Assets) remains balanced. Each transaction is recorded as both a debit in one account and a credit in another. This system provides a complete record of financial activity, enhances accuracy, and makes it easier to detect errors and fraud. Double-entry accounting is essential for organizations of all sizes, including nonprofits, to maintain transparent and reliable financial records. It supports the preparation of key financial statements and enables organizations to track the flow of funds and meet reporting requirements.