What is Sub-Ledger

A sub ledger is a ledger containing all a detailed sub-set of transactions. The total of the transactions in the sub ledger roll up into the general ledger. For example, a sub ledger may contain all accounts receivable, or accounts payable, or fixed asset transactions. Depending on the type of sub ledger, it might contain information about transaction dates, descriptions, and amounts billed, paid, or received. A summary-level entry is periodically recorded in the general ledger. If someone is researching information in the general ledger in an account that contains this summarized level of information, he or she must then access the sub ledger to review transaction-specific information.

As part of their year-end tests, auditors may trace transactions from a sub ledger to the general ledger and from there to the financial statements, to ensure that transactions are being recorded properly in the accounting system.

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Intercompany Eliminations with Journal Entries

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