What is a subledger, and why is it important?
A ledger containing all of the transactions is called a subledger.The general ledger shows the total of transactions in the subledger.All accounts receivable, accounts payable, or fixed asset transactions can be contained in a subledger.Information about transaction dates, descriptions, and amounts billed, paid, or received can be found in the subledger.The general ledger periodically records a summary-level entry.If someone is researching information in the general ledger in an account that contains this summarized level of information, he or she must access the subledger to review transaction-specific information.
Auditors can trace transactions from a subledger to the general ledger to make sure they are recorded correctly in the accounting system.
A subledger is a database in an accounting software package.