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A general ledger is the master set of accounts that summarize all of a company's financial transactions. It's the primary tool for recording, categorizing, and tracking all the company's debits and credits.
The general ledger holds account information that is needed to prepare the company's financial statements, and transaction data is categorized by type into accounts for assets, liabilities, equity, revenue, and expenses. Maintaining an accurate and timely general ledger is fundamental to effective financial management.
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