Unit 2 stuff

Discussion Capstone

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DISCUSSION CAPSTONE

The temptation to bypass the journal entries and make entries into the ledger often arises in organizations. The reason for this temptation is mainly the time saved and also the fact that recording and posting will be done as a single process. However, this should not be the case given that use of a journal is very vital for any organization because it ensures adherence to accounting principles, promotes accountability and also provides accuracy of records.

Use of general journal is by the Generally Accepted Accounting Principles (GAAP). Making transaction entries in a general journal then later posting those entries to a general ledger results into the double entry system of accounting defined by GAAPs. Overriding the use of journals results in a single entry system which leads to violation of the GAAPs. An organization should, therefore, use journals to ensure adherence to the GAAPs.

Use of the general journal provides accountability and responsibility in an organization. Making entries in the newspaper then later posting in the ledger ensures that the tasks of transaction recording are not left in the hands of one person. As such the organization provides to have separation of tasks and, therefore, s system of checks and balances. The organization is, therefore, able to maintain accountability and avoid issues of forgery and document manipulation.

Journal entries promote accuracy. Through the use of journals an organization can maintain accuracy through recording the initial transaction fast as required then later taking their time when entering the data into the ledger. The organization, therefore, move data to the ledger without making any mistakes. Direct entry into the ledger can result in mistakes which may lead to significant financial errors. The general journal also provides a chronological order of the transactions ensuring that the ledger this order is passed on later to the ledger.