Double Entry Book Keeping Basics

Double entry book keeping or double entry accounting is the name given to the system of recording financial transactions developed by the Venetions in the late 15th Century. The history of double entry book keeping given that the double entry accounting system was developed over 500 years ago, is relatively well documented and is largely credited to an eminent merchant at the time named Cotrugli. Little did he know at the time but the double entry system that he invented would still be in use over a half a millennium later.

The system of double entry book keeping relies upon two key concepts (not to be confused with accounting concepts which we shall discuss in greater detail in our accounting tutorials):


Concept 1: “for every debit there must be a credit

This is the golden rule that every book-keeper, accountant, or accounts professional must follow. It is the foundation or building block upon which all paper based or computerised accounting systems are built and goes to the very heart of double entry book keeping.


For complete beginners learning book keeping techniques for the first time it is recommended that you only concern yourself with this simplified rule for the present. As your book keeping skills grow and as your knowledge of accounts and accounting techniques is also enhanced you will find that, though the above rule remains fundamentally true, there are many circumstances where you will need to develop this golden rule. Accountsman teaches you how and explores and develops this idea on our how to book keep pages.


 Before jumping into our free book keeping tutorials we suggest that all budding bean counters also get to grips with one other very important rule.  If  “for every debit there must be a credit” is the golden rule, then the following is the silver rule.

Concept 2: “There are no positives or negatives in book keeping.”

The concept is a simple one and applies to all sets of books of account for a business, irrespective of whether that business has made a profit or a loss or the type of transaction that the book keeper is trying to record. 

The concept requires some further explanation as it is a quite a widely held belief that debits are positive and credits are negative. In double entry book keeping you will never see a positive or a negative. There are only debits or credits and the all accounts will only ever have a debit balance or a credit balance.


Now you are armed with the two basic book keeping concepts or golden rules you are ready to tackle our how to book keep pages and start your accounts journey with Accountsman.