What is a General Ledger?
A general ledger, or GL, is a means for keeping record of a company’s total financial accounts. Accounts typically recorded in a general ledger include: assets, liabilities, equity, expenses, and income or revenue. The general ledger definition may include a physical or digital record of such information, potentially embedded in a more sophisticated system of accounting software.
What is GL in the context of accounting? A company’s general ledger is the basis of its financial reporting and the source of the information used therein. Transactions are noted from a source document, such as an invoice or bill, and tracked in the general journal. Periodically, all transactions made within a company are posted to the general ledger. Since the general ledger is comprised of a company’s total financial accounts, it is instrumental in the preparation of key financial reporting documents such as the balance sheet and income statement.